9/18/04 The Soft Patch Continues
A weekly gauge of future U.S. economic activity fell 0.2% last week, the fourth decline in a row and the sixth week without any growth. Lakshman Achuthan, director of the Economic Cycle Research Institute, stated the ECRI weekly leading index is signaling "lackluster" growth through 2004 and into 2005. He opined that growth will not be strong enough to create many jobs.
Companies are trying new cost-cutting measures. Bon Macy’s, which is cutting Bon from its name, is also cutting weekly hours for many workers, and many of them have been with the company for over 10 years. Hours are being reduced to 25 hours or less per week. This reduction will cause a goodly percentage to look for a second job. Macy’s saves money on the reduced hours and they also save on reduced benefits. These workers are still employed but no longer full-time employees. Then there is Delta Airlines that cut 7,000 from its medical plan. I will no longer shop at Macy’s and will discontinue flying on Delta.
The Semiconductor Equipment and Materials Int’l trade group reported that August bookings were 5% below the revised July 2004 level and that billings were 1% below the revised July 2004 level. The research director for SEMI stated that "a number of recent company announcements suggest these levels may continue to soften in the coming months." That softening can only hinder the Nasdaq’s ability to move higher from present levels.
Over the last several months many readers have inquired as to where I get my information on plant closures and layoffs. I subscribe to a daily service and am provided emails throughout the day. They include company announcements and, whenever possible, local newspaper articles from the community that has been impacted.
As of September 15, 2,743 South Floridians have applied for disaster unemployment help due to lost work related to the hurricanes. That number is expected to rise. First Indiana Bank is cutting 30 jobs in a cost-control measure. Nexans Magnet Wire is closing its magnet-wire plant in La Grange, Ky. And 123 workers will lose their jobs.
According to the Cremation Association of North America, today roughly 25% of all deaths in the U.S. are followed by cremation, and the Association estimates that percentage will rise to 40% by 2010. It could prove the death knell for casket makers. Hillenbrand Industries of Batesville, Ind. is one of this nation’s largest casket makers. The company is laying off 100 workers in the U.S. and 130 in Europe, and lowered their 2004 earnings outlook. Hillenbrand stated casket sales fell because of the lower death rate and increased cremations. They also mentioned increased material costs, such as, steel and hardwood.
Mark Twain: "Don’t tell my mother I’m in politics. She thinks I play the piano in a whorehouse."
William Gibson, science fiction writer: "The future’s already here. It just isn’t evenly distributed."
The most recent Harris poll shows Bush’s ratings slipped to the lowest level of his Presidency. It indicates a reading of 45% positive and 54% negative. Cheney’s are 40% positive and 54% negative.
U.S. light crude oil gained $1.77 to $45.65 a barrel. I wonder whether the same analysts who proclaimed that unemployment and layoffs don’t impact the market also believe that high oil prices don’t matter either. Wal-Mart would take issue with the views of those analysts. The company is on the front lines with the consumer each and every day.
Barry Bonds hit home run number 700. Ichiro hit his 199th single of this season, breaking Lloyd Waner's 1927 mark of 198. Ichiron has 235 hits, 22 shy of George Sisler's 1920 mark of 257.
Saturday, September 18, 2004
9/18/04 The Soft Patch Continues
A weekly gauge of future U.S. economic activity fell 0.2% last week, the fourth decline in a row and the sixth week without any growth. Lakshman Achuthan, director of the Economic Cycle Research Institute, stated the ECRI weekly leading index is signaling "lackluster" growth through 2004 and into 2005. He opined that growth will not be strong enough to create many jobs.
Companies are trying new cost-cutting measures. Bon Macy’s, which is cutting Bon from its name, is also cutting weekly hours for many workers, and many of them have been with the company for over 10 years. Hours are being reduced to 25 hours or less per week. This reduction will cause a goodly percentage to look fo����������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������
A weekly gauge of future U.S. economic activity fell 0.2% last week, the fourth decline in a row and the sixth week without any growth. Lakshman Achuthan, director of the Economic Cycle Research Institute, stated the ECRI weekly leading index is signaling "lackluster" growth through 2004 and into 2005. He opined that growth will not be strong enough to create many jobs.
Companies are trying new cost-cutting measures. Bon Macy’s, which is cutting Bon from its name, is also cutting weekly hours for many workers, and many of them have been with the company for over 10 years. Hours are being reduced to 25 hours or less per week. This reduction will cause a goodly percentage to look fo����������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������������
9/18/04 The Soft Patch Continues
A weekly gauge of future U.S. economic activity fell 0.2% last week, the fourth decline in a row and the sixth week without any growth. Lakshman Achuthan, director of the Economic Cycle Research Institute, stated the ECRI weekly leading index is signaling "lackluster" growth through 2004 and into 2005. He opined that growth will not be strong enough to create many jobs.
Companies are trying new cost-cutting measures. Bon Macy’s, which is cutting Bon from its name, is also cutting weekly hours for many workers, and many of them have been with the company for over 10 years. Hours are being reduced to 25 hours or less per week. This reduction will cause a goodly percentage to look for a second job. Macy’s saves money on the reduced hours and they also save on reduced benefits. These workers are still employed but no longer full-time employees. Then there is Delta Airlines that cut 7,000 from its medical plan. I will no longer shop at Macy’s and will discontinue flying on Delta.
The Semiconductor Equipment and Materials Int’l trade group reported that August bookings were 5% below the revised July 2004 level and that billings were 1% below the revised July 2004 level. The research director for SEMI stated that "a number of recent company announcements suggest these levels may continue to soften in the coming months." That softening can only hinder the Nasdaq’s ability to move higher from present levels.
Over the last several months many readers have inquired as to where I get my information on plant closures and layoffs. I subscribe to a daily service and am provided emails throughout the day. They include company announcements and, whenever possible, local newspaper articles from the community that has been impacted.
As of September 15, 2,743 South Floridians have applied for disaster unemployment help due to lost work related to the hurricanes. That number is expected to rise. First Indiana Bank is cutting 30 jobs in a cost-control measure. Nexans Magnet Wire is closing its magnet-wire plant in La Grange, Ky. And 123 workers will lose their jobs.
According to the Cremation Association of North America, today roughly 25% of all deaths in the U.S. are followed by cremation, and the Association estimates that percentage will rise to 40% by 2010. It could prove the death knell for casket makers. Hillenbrand Industries of Batesville, Ind. is one of this nation’s largest casket makers. The company is laying off 100 workers in the U.S. and 130 in Europe, and lowered their 2004 earnings outlook. Hillenbrand stated casket sales fell because of the lower death rate and increased cremations. They also mentioned increased material costs, such as, steel and hardwood.
Mark Twain: "Don’t tell my mother I’m in politics. She thinks I play the piano in a whorehouse."
William Gibson, science fiction writer: "The future’s already here. It just isn’t evenly distributed."
The most recent Harris poll shows Bush’s ratings slipped to the lowest level of his Presidency. It indicates a reading of 45% positive and 54% negative. Cheney’s are 40% positive and 54% negative.
U.S. light crude oil gained $1.77 to $45.65 a barrel. I wonder whether the same analysts who proclaimed that unemployment and layoffs don’t impact the market also believe that high oil prices don’t matter either. Wal-Mart would take issue with the views of those analysts. The company is on the front lines with the consumer each and every day.
A weekly gauge of future U.S. economic activity fell 0.2% last week, the fourth decline in a row and the sixth week without any growth. Lakshman Achuthan, director of the Economic Cycle Research Institute, stated the ECRI weekly leading index is signaling "lackluster" growth through 2004 and into 2005. He opined that growth will not be strong enough to create many jobs.
Companies are trying new cost-cutting measures. Bon Macy’s, which is cutting Bon from its name, is also cutting weekly hours for many workers, and many of them have been with the company for over 10 years. Hours are being reduced to 25 hours or less per week. This reduction will cause a goodly percentage to look for a second job. Macy’s saves money on the reduced hours and they also save on reduced benefits. These workers are still employed but no longer full-time employees. Then there is Delta Airlines that cut 7,000 from its medical plan. I will no longer shop at Macy’s and will discontinue flying on Delta.
The Semiconductor Equipment and Materials Int’l trade group reported that August bookings were 5% below the revised July 2004 level and that billings were 1% below the revised July 2004 level. The research director for SEMI stated that "a number of recent company announcements suggest these levels may continue to soften in the coming months." That softening can only hinder the Nasdaq’s ability to move higher from present levels.
Over the last several months many readers have inquired as to where I get my information on plant closures and layoffs. I subscribe to a daily service and am provided emails throughout the day. They include company announcements and, whenever possible, local newspaper articles from the community that has been impacted.
As of September 15, 2,743 South Floridians have applied for disaster unemployment help due to lost work related to the hurricanes. That number is expected to rise. First Indiana Bank is cutting 30 jobs in a cost-control measure. Nexans Magnet Wire is closing its magnet-wire plant in La Grange, Ky. And 123 workers will lose their jobs.
According to the Cremation Association of North America, today roughly 25% of all deaths in the U.S. are followed by cremation, and the Association estimates that percentage will rise to 40% by 2010. It could prove the death knell for casket makers. Hillenbrand Industries of Batesville, Ind. is one of this nation’s largest casket makers. The company is laying off 100 workers in the U.S. and 130 in Europe, and lowered their 2004 earnings outlook. Hillenbrand stated casket sales fell because of the lower death rate and increased cremations. They also mentioned increased material costs, such as, steel and hardwood.
Mark Twain: "Don’t tell my mother I’m in politics. She thinks I play the piano in a whorehouse."
William Gibson, science fiction writer: "The future’s already here. It just isn’t evenly distributed."
The most recent Harris poll shows Bush’s ratings slipped to the lowest level of his Presidency. It indicates a reading of 45% positive and 54% negative. Cheney’s are 40% positive and 54% negative.
U.S. light crude oil gained $1.77 to $45.65 a barrel. I wonder whether the same analysts who proclaimed that unemployment and layoffs don’t impact the market also believe that high oil prices don’t matter either. Wal-Mart would take issue with the views of those analysts. The company is on the front lines with the consumer each and every day.
9/18/04 The Soft Patch Continues
A weekly gauge of future U.S. economic activity fell 0.2% last week, the fourth decline in a row and the sixth week without any growth. Lakshman Achuthan, director of the Economic Cycle Research Institute, stated the ECRI weekly leading index is signaling "lackluster" growth through 2004 and into 2005. He opined that growth will not be strong enough to create many jobs.
Companies are trying new cost-cutting measures. Bon Macy’s, which is cutting Bon from its name, is also cutting weekly hours for many workers, and many of them have been with the company for over 10 years. Hours are being reduced to 25 hours or less per week. This reduction will cause a goodly percentage to look for a second job. Macy’s saves money on the reduced hours and they also save on reduced benefits. These workers are still employed but no longer full-time employees. Then there is Delta Airlines that cut 7,000 from its medical plan. I will no longer shop at Macy’s and will discontinue flying on Delta.
The Semiconductor Equipment and Materials Int’l trade group reported that August bookings were 5% below the revised July 2004 level and that billings were 1% below the revised July 2004 level. The research director for SEMI stated that "a number of recent company announcements suggest these levels may continue to soften in the coming months." That softening can only hinder the Nasdaq’s ability to move higher from present levels.
Over the last several months many readers have inquired as to where I get my information on plant closures and layoffs. I subscribe to a daily service and am provided emails throughout the day. They include company announcements and, whenever possible, local newspaper articles from the community that has been impacted.
As of September 15, 2,743 South Floridians have applied for disaster unemployment help due to lost work related to the hurricanes. That number is expected to rise. First Indiana Bank is cutting 30 jobs in a cost-control measure. Nexans Magnet Wire is closing its magnet-wire plant in La Grange, Ky. And 123 workers will lose their jobs.
According to the Cremation Association of North America, today roughly 25% of all deaths in the U.S. are followed by cremation, and the Association estimates that percentage will rise to 40% by 2010. It could prove the death knell for casket makers. Hillenbrand Industries of Batesville, Ind. is one of this nation’s largest casket makers. The company is laying off 100 workers in the U.S. and 130 in Europe, and lowered their 2004 earnings outlook. Hillenbrand stated casket sales fell because of the lower death rate and increased cremations. They also mentioned increased material costs, such as, steel and hardwood.
Mark Twain: "Don’t tell my mother I’m in politics. She thinks I play the piano in a whorehouse."
William Gibson, science fiction writer: "The future’s already here. It just isn’t evenly distributed."
The most recent Harris poll shows Bush’s ratings slipped to the lowest level of his Presidency. It indicates a reading of 45% positive and 54% negative. Cheney’s are 40% positive and 54% negative.
U.S. light crude oil gained $1.77 to $45.65 a barrel. I wonder whether the same analysts who proclaimed that unemployment and layoffs don’t impact the market also believe that high oil prices don’t matter either. Wal-Mart would take issue with the views of those analysts. The company is on the front lines with the consumer each and every day.
A weekly gauge of future U.S. economic activity fell 0.2% last week, the fourth decline in a row and the sixth week without any growth. Lakshman Achuthan, director of the Economic Cycle Research Institute, stated the ECRI weekly leading index is signaling "lackluster" growth through 2004 and into 2005. He opined that growth will not be strong enough to create many jobs.
Companies are trying new cost-cutting measures. Bon Macy’s, which is cutting Bon from its name, is also cutting weekly hours for many workers, and many of them have been with the company for over 10 years. Hours are being reduced to 25 hours or less per week. This reduction will cause a goodly percentage to look for a second job. Macy’s saves money on the reduced hours and they also save on reduced benefits. These workers are still employed but no longer full-time employees. Then there is Delta Airlines that cut 7,000 from its medical plan. I will no longer shop at Macy’s and will discontinue flying on Delta.
The Semiconductor Equipment and Materials Int’l trade group reported that August bookings were 5% below the revised July 2004 level and that billings were 1% below the revised July 2004 level. The research director for SEMI stated that "a number of recent company announcements suggest these levels may continue to soften in the coming months." That softening can only hinder the Nasdaq’s ability to move higher from present levels.
Over the last several months many readers have inquired as to where I get my information on plant closures and layoffs. I subscribe to a daily service and am provided emails throughout the day. They include company announcements and, whenever possible, local newspaper articles from the community that has been impacted.
As of September 15, 2,743 South Floridians have applied for disaster unemployment help due to lost work related to the hurricanes. That number is expected to rise. First Indiana Bank is cutting 30 jobs in a cost-control measure. Nexans Magnet Wire is closing its magnet-wire plant in La Grange, Ky. And 123 workers will lose their jobs.
According to the Cremation Association of North America, today roughly 25% of all deaths in the U.S. are followed by cremation, and the Association estimates that percentage will rise to 40% by 2010. It could prove the death knell for casket makers. Hillenbrand Industries of Batesville, Ind. is one of this nation’s largest casket makers. The company is laying off 100 workers in the U.S. and 130 in Europe, and lowered their 2004 earnings outlook. Hillenbrand stated casket sales fell because of the lower death rate and increased cremations. They also mentioned increased material costs, such as, steel and hardwood.
Mark Twain: "Don’t tell my mother I’m in politics. She thinks I play the piano in a whorehouse."
William Gibson, science fiction writer: "The future’s already here. It just isn’t evenly distributed."
The most recent Harris poll shows Bush’s ratings slipped to the lowest level of his Presidency. It indicates a reading of 45% positive and 54% negative. Cheney’s are 40% positive and 54% negative.
U.S. light crude oil gained $1.77 to $45.65 a barrel. I wonder whether the same analysts who proclaimed that unemployment and layoffs don’t impact the market also believe that high oil prices don’t matter either. Wal-Mart would take issue with the views of those analysts. The company is on the front lines with the consumer each and every day.
9/18/04 The Soft Patch Continues
A weekly gauge of future U.S. economic activity fell 0.2% last week, the fourth decline in a row and the sixth week without any growth. Lakshman Achuthan, director of the Economic Cycle Research Institute, stated the ECRI weekly leading index is signaling "lackluster" growth through 2004 and into 2005. He opined that growth will not be strong enough to create many jobs.
Companies are trying new cost-cutting measures. Bon Macy’s, which is cutting Bon from its name, is also cutting weekly hours for many workers, and many of them have been with the company for over 10 years. Hours are being reduced to 25 hours or less per week. This reduction will cause a goodly percentage to look for a second job. Macy’s saves money on the reduced hours and they also save on reduced benefits. These workers are still employed but no longer full-time employees. Then there is Delta Airlines that cut 7,000 from its medical plan. I will no longer shop at Macy’s and will discontinue flying on Delta.
The Semiconductor Equipment and Materials Int’l trade group reported that August bookings were 5% below the revised July 2004 level and that billings were 1% below the revised July 2004 level. The research director for SEMI stated that "a number of recent company announcements suggest these levels may continue to soften in the coming months." That softening can only hinder the Nasdaq’s ability to move higher from present levels.
Over the last several months many readers have inquired as to where I get my information on plant closures and layoffs. I subscribe to a daily service and am provided emails throughout the day. They include company announcements and, whenever possible, local newspaper articles from the community that has been impacted.
As of September 15, 2,743 South Floridians have applied for disaster unemployment help due to lost work related to the hurricanes. That number is expected to rise. First Indiana Bank is cutting 30 jobs in a cost-control measure. Nexans Magnet Wire is closing its magnet-wire plant in La Grange, Ky. And 123 workers will lose their jobs.
According to the Cremation Association of North America, today roughly 25% of all deaths in the U.S. are followed by cremation, and the Association estimates that percentage will rise to 40% by 2010. It could prove the death knell for casket makers. Hillenbrand Industries of Batesville, Ind. is one of this nation’s largest casket makers. The company is laying off 100 workers in the U.S. and 130 in Europe, and lowered their 2004 earnings outlook. Hillenbrand stated casket sales fell because of the lower death rate and increased cremations. They also mentioned increased material costs, such as, steel and hardwood.
Mark Twain: "Don’t tell my mother I’m in politics. She thinks I play the piano in a whorehouse."
William Gibson, science fiction writer: "The future’s already here. It just isn’t evenly distributed."
The most recent Harris poll shows Bush’s ratings slipped to the lowest level of his Presidency. It indicates a reading of 45% positive and 54% negative. Cheney’s are 40% positive and 54% negative.
U.S. light crude oil gained $1.77 to $45.65 a barrel. I wonder whether the same analysts who proclaimed that unemployment and layoffs don’t impact the market also believe that high oil prices don’t matter either. Wal-Mart would take issue with the views of those analysts. The company is on the front lines with the consumer each and every day.
A weekly gauge of future U.S. economic activity fell 0.2% last week, the fourth decline in a row and the sixth week without any growth. Lakshman Achuthan, director of the Economic Cycle Research Institute, stated the ECRI weekly leading index is signaling "lackluster" growth through 2004 and into 2005. He opined that growth will not be strong enough to create many jobs.
Companies are trying new cost-cutting measures. Bon Macy’s, which is cutting Bon from its name, is also cutting weekly hours for many workers, and many of them have been with the company for over 10 years. Hours are being reduced to 25 hours or less per week. This reduction will cause a goodly percentage to look for a second job. Macy’s saves money on the reduced hours and they also save on reduced benefits. These workers are still employed but no longer full-time employees. Then there is Delta Airlines that cut 7,000 from its medical plan. I will no longer shop at Macy’s and will discontinue flying on Delta.
The Semiconductor Equipment and Materials Int’l trade group reported that August bookings were 5% below the revised July 2004 level and that billings were 1% below the revised July 2004 level. The research director for SEMI stated that "a number of recent company announcements suggest these levels may continue to soften in the coming months." That softening can only hinder the Nasdaq’s ability to move higher from present levels.
Over the last several months many readers have inquired as to where I get my information on plant closures and layoffs. I subscribe to a daily service and am provided emails throughout the day. They include company announcements and, whenever possible, local newspaper articles from the community that has been impacted.
As of September 15, 2,743 South Floridians have applied for disaster unemployment help due to lost work related to the hurricanes. That number is expected to rise. First Indiana Bank is cutting 30 jobs in a cost-control measure. Nexans Magnet Wire is closing its magnet-wire plant in La Grange, Ky. And 123 workers will lose their jobs.
According to the Cremation Association of North America, today roughly 25% of all deaths in the U.S. are followed by cremation, and the Association estimates that percentage will rise to 40% by 2010. It could prove the death knell for casket makers. Hillenbrand Industries of Batesville, Ind. is one of this nation’s largest casket makers. The company is laying off 100 workers in the U.S. and 130 in Europe, and lowered their 2004 earnings outlook. Hillenbrand stated casket sales fell because of the lower death rate and increased cremations. They also mentioned increased material costs, such as, steel and hardwood.
Mark Twain: "Don’t tell my mother I’m in politics. She thinks I play the piano in a whorehouse."
William Gibson, science fiction writer: "The future’s already here. It just isn’t evenly distributed."
The most recent Harris poll shows Bush’s ratings slipped to the lowest level of his Presidency. It indicates a reading of 45% positive and 54% negative. Cheney’s are 40% positive and 54% negative.
U.S. light crude oil gained $1.77 to $45.65 a barrel. I wonder whether the same analysts who proclaimed that unemployment and layoffs don’t impact the market also believe that high oil prices don’t matter either. Wal-Mart would take issue with the views of those analysts. The company is on the front lines with the consumer each and every day.
Friday, September 17, 2004
9/17/04 Bad News Bears
The news can and will get worse. A total of 1,020 U.S. service members have been killed in Iraq. The report by Charles Duelfer, chief U.S. weapons inspector, will show that, after a year and a half in Iraq, no WMD have been found. U.N. Secretary-General Kofi Annan stated the U.S. invasion of Iraq was illegal because it violated the U.N. charter. The U.S. is part of the 15-member Security Council and Annan said that Council should have approved the invasion. After the election, more troops will be sent to Iraq. This is Bush’s Vietnam.
The news on the business front will get worse. An example is the Philadelphia Fed Manufacturing Index that fell in September to 13.4 from 28.5 in August. The future general activity index fell to 44.9 from 52.7. Meanwhile, our country’s debt continues to grow. U.S. second quarter non-financial debt grew at a 7.7% annual rate, close to triple the rate of growth of our GDP. U.S. second quarter debt grew at a 9.5% annual rate. The Federal debt increased at a 10.7% rate, down slightly from the 12% rate in the first quarter. There is no legitimate excuse for the Federal debt to rise at this rate. At the same time, according to the BLS, adjusted for the 0.1% increase in the CPI, real average weekly earnings increased by 0.2% from July to August. Average weekly hours were unchanged. The core CPI (excl. food and energy) is up 1.8% from one year ago, below the average of 2.3% over the past 10 years. The Fed, however, wants to raise interest rates again. If they raise the Fed Funds to 1.75 percent that will roughly equate to the core CPI rate of increase for the past 12 months. With GDP growth slowing, there is no reason to raise rates any more than that. If you doubt that growth is slowing, just look at the yield on 10 year treasury notes at 4.07%, the same level seen in February 2004.
If business were buoyant, there would not be as many plant closures and mass layoffs. United Airlines has about 62,000 employees, down from more than 100,000 three years ago. The CEO mentioned that additional significant job cuts can be expected, and there is speculation of changes in their Denver hub. The Maytag Galesburg, Ill. Plant closed its doors this week, and 900 jobs were lost- to Mexico. Maytag stated they would also layoff up to 170 workers at its washer and dryer plant in Newton, Iowa this month. The layoffs are due to lower demand for certain products at the Newton plant.
Jobless claims rose 16,000 in the week ending Sept. 16.
Nortel, North America’s largest maker of telecom equipment, stated that it expects to report lower third quarter revenues compared to the second quarter.
In June, international investors purchased a net $40.6 billion in U.S. gov’t debt. In July, that figure declined to $22.4 billion.
According to the CFSB Tremont hedge fund index, the average return for August was 0.1%, and a large percentage show losses year to date.
Households with over $100,000 in yearly income represent 22% of aggregate income in the U.S. compared with 18% only 10 years ago.
David O’Reilly, Chmn. & CEO of ChevronTexaco: "I think there is the potential for an underlying shift in value of the oil price. It is possible we are at the same place as we were in the late 1970s, although I don’t want to say that in absolute terms. There is a lack of spare capacity out there."
Fed Governor Edward Gramlich stated it is "virtually inevitable" that oil price shocks will result in some combination of higher inflation and higher unemployment for a time. However, he went on to say, that "our worst possible outcome is for monetary policy makers to let inflation come loose from its moorings." In actuality, it is the Fed that started the inflation ball rolling, such as, in housing, by printing money at double digit rates and keeping Fed Funds at artificially low levels. The "natural rate" for the Fed is a level where their screws do come loose from their moorings.
According to John S. Herold and Harrison Lovegrove & Co., last year oil companies spent about $30 billion on stock buybacks and $30 billion looking for new oil and gas fields.
In a new Harris poll, Kerry leads Bush 48% to 47%. The new Pew poll shows the candidates even. The Tradesports presidential contract has Bush at 67 and Kerry at 32. It’s a little like the "bond pros" who are short the 10 year treasury notes. They are having trouble reading the tea leaves and their positions are in the red.
Abebooks.com is the world’s largest online marketplace for books with over 60 million new, used, rare, and out-of-print books. Their textbook sales for the month of August were up 394% from the same time last year. The company attributes the strong sales to, among several contributing factors including, "financially strapped students are increasingly wary of expensive new editions and are turning to online booksellers for a wider selection and competitive pricing on new and used textbooks."
According to Bankrate.com’s weekly national survey of large lenders, the 15-year fixed rate mortgage fell this week to 5.16% from 5.23%.
The news can and will get worse. A total of 1,020 U.S. service members have been killed in Iraq. The report by Charles Duelfer, chief U.S. weapons inspector, will show that, after a year and a half in Iraq, no WMD have been found. U.N. Secretary-General Kofi Annan stated the U.S. invasion of Iraq was illegal because it violated the U.N. charter. The U.S. is part of the 15-member Security Council and Annan said that Council should have approved the invasion. After the election, more troops will be sent to Iraq. This is Bush’s Vietnam.
The news on the business front will get worse. An example is the Philadelphia Fed Manufacturing Index that fell in September to 13.4 from 28.5 in August. The future general activity index fell to 44.9 from 52.7. Meanwhile, our country’s debt continues to grow. U.S. second quarter non-financial debt grew at a 7.7% annual rate, close to triple the rate of growth of our GDP. U.S. second quarter debt grew at a 9.5% annual rate. The Federal debt increased at a 10.7% rate, down slightly from the 12% rate in the first quarter. There is no legitimate excuse for the Federal debt to rise at this rate. At the same time, according to the BLS, adjusted for the 0.1% increase in the CPI, real average weekly earnings increased by 0.2% from July to August. Average weekly hours were unchanged. The core CPI (excl. food and energy) is up 1.8% from one year ago, below the average of 2.3% over the past 10 years. The Fed, however, wants to raise interest rates again. If they raise the Fed Funds to 1.75 percent that will roughly equate to the core CPI rate of increase for the past 12 months. With GDP growth slowing, there is no reason to raise rates any more than that. If you doubt that growth is slowing, just look at the yield on 10 year treasury notes at 4.07%, the same level seen in February 2004.
If business were buoyant, there would not be as many plant closures and mass layoffs. United Airlines has about 62,000 employees, down from more than 100,000 three years ago. The CEO mentioned that additional significant job cuts can be expected, and there is speculation of changes in their Denver hub. The Maytag Galesburg, Ill. Plant closed its doors this week, and 900 jobs were lost- to Mexico. Maytag stated they would also layoff up to 170 workers at its washer and dryer plant in Newton, Iowa this month. The layoffs are due to lower demand for certain products at the Newton plant.
Jobless claims rose 16,000 in the week ending Sept. 16.
Nortel, North America’s largest maker of telecom equipment, stated that it expects to report lower third quarter revenues compared to the second quarter.
In June, international investors purchased a net $40.6 billion in U.S. gov’t debt. In July, that figure declined to $22.4 billion.
According to the CFSB Tremont hedge fund index, the average return for August was 0.1%, and a large percentage show losses year to date.
Households with over $100,000 in yearly income represent 22% of aggregate income in the U.S. compared with 18% only 10 years ago.
David O’Reilly, Chmn. & CEO of ChevronTexaco: "I think there is the potential for an underlying shift in value of the oil price. It is possible we are at the same place as we were in the late 1970s, although I don’t want to say that in absolute terms. There is a lack of spare capacity out there."
Fed Governor Edward Gramlich stated it is "virtually inevitable" that oil price shocks will result in some combination of higher inflation and higher unemployment for a time. However, he went on to say, that "our worst possible outcome is for monetary policy makers to let inflation come loose from its moorings." In actuality, it is the Fed that started the inflation ball rolling, such as, in housing, by printing money at double digit rates and keeping Fed Funds at artificially low levels. The "natural rate" for the Fed is a level where their screws do come loose from their moorings.
According to John S. Herold and Harrison Lovegrove & Co., last year oil companies spent about $30 billion on stock buybacks and $30 billion looking for new oil and gas fields.
In a new Harris poll, Kerry leads Bush 48% to 47%. The new Pew poll shows the candidates even. The Tradesports presidential contract has Bush at 67 and Kerry at 32. It’s a little like the "bond pros" who are short the 10 year treasury notes. They are having trouble reading the tea leaves and their positions are in the red.
Abebooks.com is the world’s largest online marketplace for books with over 60 million new, used, rare, and out-of-print books. Their textbook sales for the month of August were up 394% from the same time last year. The company attributes the strong sales to, among several contributing factors including, "financially strapped students are increasingly wary of expensive new editions and are turning to online booksellers for a wider selection and competitive pricing on new and used textbooks."
According to Bankrate.com’s weekly national survey of large lenders, the 15-year fixed rate mortgage fell this week to 5.16% from 5.23%.
Thursday, September 16, 2004
9/16/04 Storms
According to the latest Duke University CFO Outlook Survey, chief financial officers of U.S. corporations are markedly less optimistic about the domestic economy than they were three months ago, and they are concerned about consumer spending, health-care costs, and domestic terrorism. CFOs predict only 2.8% real GDP growth over the next 12 months. This forecast is considerably lower than the Fed’s expectations. When was the last time the Fed was right?
Regarding the Administration’s Medicare program, which went into law based on cost estimates that were $135 billion lower than those documented by Rick Foster, the chief Medicare actuary at the HHS, once the drug benefit begins in 2006, seniors will pay an additional premium that goes up every year.
According to the BLS, employer costs for employee compensation averaged $24.96 prt hour worked in June 2004. Wages and salaries averaged $17.70 and benefits amounted to $7.26. Costs for legally required benefits, including Social Security, Medicare, unemployment insurance, and workers’ compensation, averaged $2.03 per hour, representing the largest non-wage employer cost.
Kerr-McGee Chemical, a wholly-owned affiliate of Kerr-McGee Corp., is the world’s third-largest producer and marketer of titanium dioxide pigment, an inorganic whitener and opacifier for paints, plastics, paper, inks, and hundreds of consumer products. The company plans to shut down its titanium pigment sulfate production at its Savannah facility by the end of September and will cut 140 jobs.
According to a report by Genomic Society Consulting, an emerging services sector in India is poised to capture a new wave of offshore contracts from the U.S. pharmaceutical, biotech, and life sciences technology industries. They report "known worldwide for sophisticated IT services, and lately for a biotechnology boom that is moving from copycat drugs into R&D, India is well-positioned to merge the talent of these two industries into a service sector that meets the needs of the global drug discovery industry. Our research reveals that salaries for skilled professionals and PhDs in this sector are as much as 90% lower in India than the U.S., so cost savings can be significant."
Shanghai’s National Bureau of Statistics slashed its forecast for China’s full-year automobile production to 2.39 million units from 2.82 million and trimmed the annual growth rate to 18% from 40%. With output in July and August nearly flat, more than 30% of capacity stood idle as vehicle makers were forced to cut prices to try and get through stalled inventories, stated the NBS. China’s vehicle market is currently the world’s fourth largest. Xu Yunkai, an auto analyst with Guotai Junan Securities, stated "auto consumers are becoming more rational and are waiting for price cuts as they also focus more on brands and the service offered by the auto companies." The NBS also said carmakers were likely to try and consolidate their position in the market by steeper price reductions while reducing production. The market in China has been doing the heavy lifting for GM. The company won’t come close to making their numbers for 2005.
U.S. business inventories grew 0.9% in July while sales only increased 0.6%. Auto inventories, already bloated, increased 1.8%. Wall Street took the inventory rise as being bullish. Maybe that’s because they’ve not run a business. When inventory production outpaces sales for two consecutive months, that spells potential problems. Has Wall Street ever heard of just-in-time inventories? If not, Wal-Mart can explain it. Bloated inventories will create price reductions and production cutbacks. That’s the story in China’s auto market.
Sluggish sales in North America and Europe will cause Coca Cola to miss second half estimates by a wide margin.
The state of Washington lost 6,800 jobs in August and the unemployment rate rose to 6.2% from July’s 6%. In February 2004, the rate was also 6.2%. That’s six months without an improvement.
August factory capacity utilization was unchanged at 77.3%. There is plenty of slack in this economy.
H. Ross Perot: "If you see a snake, just kill it. Don’t appoint a committee on a snake."
H. Ross Perot: "If we did nit have such a thing as an airline industry today, we would probably create something the size of NASA to make one."
The API stated that crude inventories fell by 2.3 million barrels in the week ended Spt. 10 while the Energy Dept reported a 7.1 million barrel drop. Every day gas prices remain at high levels is another day of pressure on consumer cash flow.
After Associated Ban-Corp completes the acquisition of First Federal Capital, about 425 positions will be cut.
A Goldman Sachs survey indicated softening corporate spending on technology.
According to the Generic Pharmaceutical Assoc., generics represent 51% of the total prescriptions dispensed in the U.S., but represents less than 8% of all dollars spent on prescription drugs.
It may not be readily apparent, but we are facing a recession right in the face. The consumer has started the ball rolling. Exports into the U.S. are feeling the pinch.
William McChesney Martin: "The Fed’s mission is to take away the punch bowl just when the party gets going." That statement was made several decades ago. Today the punch bowl is on empty and the Fed’s grasp of the economy has long since been rinsed down the drain.
The National Intelligence Council (that's funny) provided a pessimistic assessment about the future security and stability of Iraq.
According to the latest Duke University CFO Outlook Survey, chief financial officers of U.S. corporations are markedly less optimistic about the domestic economy than they were three months ago, and they are concerned about consumer spending, health-care costs, and domestic terrorism. CFOs predict only 2.8% real GDP growth over the next 12 months. This forecast is considerably lower than the Fed’s expectations. When was the last time the Fed was right?
Regarding the Administration’s Medicare program, which went into law based on cost estimates that were $135 billion lower than those documented by Rick Foster, the chief Medicare actuary at the HHS, once the drug benefit begins in 2006, seniors will pay an additional premium that goes up every year.
According to the BLS, employer costs for employee compensation averaged $24.96 prt hour worked in June 2004. Wages and salaries averaged $17.70 and benefits amounted to $7.26. Costs for legally required benefits, including Social Security, Medicare, unemployment insurance, and workers’ compensation, averaged $2.03 per hour, representing the largest non-wage employer cost.
Kerr-McGee Chemical, a wholly-owned affiliate of Kerr-McGee Corp., is the world’s third-largest producer and marketer of titanium dioxide pigment, an inorganic whitener and opacifier for paints, plastics, paper, inks, and hundreds of consumer products. The company plans to shut down its titanium pigment sulfate production at its Savannah facility by the end of September and will cut 140 jobs.
According to a report by Genomic Society Consulting, an emerging services sector in India is poised to capture a new wave of offshore contracts from the U.S. pharmaceutical, biotech, and life sciences technology industries. They report "known worldwide for sophisticated IT services, and lately for a biotechnology boom that is moving from copycat drugs into R&D, India is well-positioned to merge the talent of these two industries into a service sector that meets the needs of the global drug discovery industry. Our research reveals that salaries for skilled professionals and PhDs in this sector are as much as 90% lower in India than the U.S., so cost savings can be significant."
Shanghai’s National Bureau of Statistics slashed its forecast for China’s full-year automobile production to 2.39 million units from 2.82 million and trimmed the annual growth rate to 18% from 40%. With output in July and August nearly flat, more than 30% of capacity stood idle as vehicle makers were forced to cut prices to try and get through stalled inventories, stated the NBS. China’s vehicle market is currently the world’s fourth largest. Xu Yunkai, an auto analyst with Guotai Junan Securities, stated "auto consumers are becoming more rational and are waiting for price cuts as they also focus more on brands and the service offered by the auto companies." The NBS also said carmakers were likely to try and consolidate their position in the market by steeper price reductions while reducing production. The market in China has been doing the heavy lifting for GM. The company won’t come close to making their numbers for 2005.
U.S. business inventories grew 0.9% in July while sales only increased 0.6%. Auto inventories, already bloated, increased 1.8%. Wall Street took the inventory rise as being bullish. Maybe that’s because they’ve not run a business. When inventory production outpaces sales for two consecutive months, that spells potential problems. Has Wall Street ever heard of just-in-time inventories? If not, Wal-Mart can explain it. Bloated inventories will create price reductions and production cutbacks. That’s the story in China’s auto market.
Sluggish sales in North America and Europe will cause Coca Cola to miss second half estimates by a wide margin.
The state of Washington lost 6,800 jobs in August and the unemployment rate rose to 6.2% from July’s 6%. In February 2004, the rate was also 6.2%. That’s six months without an improvement.
August factory capacity utilization was unchanged at 77.3%. There is plenty of slack in this economy.
H. Ross Perot: "If you see a snake, just kill it. Don’t appoint a committee on a snake."
H. Ross Perot: "If we did nit have such a thing as an airline industry today, we would probably create something the size of NASA to make one."
The API stated that crude inventories fell by 2.3 million barrels in the week ended Spt. 10 while the Energy Dept reported a 7.1 million barrel drop. Every day gas prices remain at high levels is another day of pressure on consumer cash flow.
After Associated Ban-Corp completes the acquisition of First Federal Capital, about 425 positions will be cut.
A Goldman Sachs survey indicated softening corporate spending on technology.
According to the Generic Pharmaceutical Assoc., generics represent 51% of the total prescriptions dispensed in the U.S., but represents less than 8% of all dollars spent on prescription drugs.
It may not be readily apparent, but we are facing a recession right in the face. The consumer has started the ball rolling. Exports into the U.S. are feeling the pinch.
William McChesney Martin: "The Fed’s mission is to take away the punch bowl just when the party gets going." That statement was made several decades ago. Today the punch bowl is on empty and the Fed’s grasp of the economy has long since been rinsed down the drain.
The National Intelligence Council (that's funny) provided a pessimistic assessment about the future security and stability of Iraq.
Wednesday, September 15, 2004
9/15/04 Ivan Comes Packing
From Florida to Louisiana, millions wait for the arrival of Ivan. Meanwhile, Royal Dutch Shell evacuated 850 employees at its exploration and production facilities in the eastern and central Gulf of Mexico, and this will impact 445,000 barrels of oil and 1.443 billion cubic feet of gas per day.
Japan is having its worst typhoon season on record.
Of 45 million Americans without health insurance, 60% work in small businesses.
Xilinx cuts its second quarter revenue outlook as well as its gross margin forecast. The company stated that sales in the Asia Pacific region will be down double digits from the first quarter.
Oracle’s application software sales declined 36% in the quarter. PeopleSoft is in that business.
According to the Commerce Dept, the U.S. current account deficit widened to a record $166.2 billion in the second quarter from $147.2 billion in the first quarter and that’s with a weak U.S. dollar. The deficit increased to a record 5.7% of GDP during the quarter. If we include the other half of the twin tower deficits, then the deficits amount to 10% of our GDP, and that is enough to topple our economic well being.
Lakshman Achuthan, Economic Cycle Research Institute managing director: "The numbers show that retail sales are in a clear cyclical downtrend." Just a reminder that we are a consumer-based economy.
North Carolina has lost 160,000 manufacturing jobs under Bush. A GOP presidential nominee hasn’t lost North Carolina since 1976. Edwards is the first North Carolinian on a national ticket in 140 years.
The Pension Benefit Guaranty Corp. pays benefits to about 1 million Americans and insures private pensions for approximately 43 million more. In a 29-page report by the Center On Federal Financial Institutions, the analysis revealed that the PBGC will run out of money in 2020 if current financial conditions persist. The agency’s programs ended 2003 with about $35 billion of assets, according to its annual report.
The recent study by the Center for Economic and Policy Research stated that between March 2001 and July 2004 the state of Pennsylvania lost over 81,000 jobs, or 1.4% of the total number of jobs in the state. During that three year time period, nearly 1 in 20 Pennsylvania workers lost a long-term job compared with about 1 in 25 in the nation as a whole.
Herbert Hoover: "There are only three ways to meet unpaid bills of a nation. The first is taxation. The second is repudiation. The third is inflation."
George W. Bush: "Natural gas is hemispheric. I like to call it hemispheric in nature because it is a product that we can find in our neighborhoods."
Wyeth is closing its West Chester, PA plant and 200 employees will lose their jobs. Foremost Dairies will close its plant in Hawaii. The company provides 25% of the state’s milk supply, and 120 workers will be out of jobs.
The state of Oklahoma remains more than 50,000 jobs, or 3.6%, below the June 2001 peak in seasonally adjusted employment.
The Center for Urban Economic Development at the University of Illinois-Chicago released a study yesterday showing that more than 403,000 U.S. information technology jobs have disappeared since March 2001. The report stated "the gap between the ‘two economies’…is especially pronounced in the information techology industry, where job dislocations due to ‘offshoring’ have contributed to an already hard-hit IT industry."
Grant Aldonas, U.S. undersecretary of commerce, stated he told China to expect American textile makers to seek new limits on Chinese imports as soon as next week.
In 1999, according to the Labor Dept, the average household health expenditure was $1,959, or 4.5% of income. In 2002, it had risen to $2,350 a year, or 4.8% of its income. In fact, in 2002, healthcare spending exceeded federal taxes as a percentage of household income. In late November 2004, the figures will be released for 2003. The percentages will have risen once again, and most likely equate to 5% of the average household income. It should be noted that, even with the rising cost of gasoline, nearly twice as much is spent on healthcare than on gas by the average household. When analyzing the slowing of retail sales, the key ingredient not mentioned is rising healthcare expenditures as a percentage of the average household income. Between healthcare and gas, the average consumer has no choice but to cut back. After accounting for inflation, wages and salaries and benefits are falling for the paycheck-to-paycheck consumer. The numbers work against a consumer-based economy. Going against those statistics will bring you a lot of investor hurt.
From Florida to Louisiana, millions wait for the arrival of Ivan. Meanwhile, Royal Dutch Shell evacuated 850 employees at its exploration and production facilities in the eastern and central Gulf of Mexico, and this will impact 445,000 barrels of oil and 1.443 billion cubic feet of gas per day.
Japan is having its worst typhoon season on record.
Of 45 million Americans without health insurance, 60% work in small businesses.
Xilinx cuts its second quarter revenue outlook as well as its gross margin forecast. The company stated that sales in the Asia Pacific region will be down double digits from the first quarter.
Oracle’s application software sales declined 36% in the quarter. PeopleSoft is in that business.
According to the Commerce Dept, the U.S. current account deficit widened to a record $166.2 billion in the second quarter from $147.2 billion in the first quarter and that’s with a weak U.S. dollar. The deficit increased to a record 5.7% of GDP during the quarter. If we include the other half of the twin tower deficits, then the deficits amount to 10% of our GDP, and that is enough to topple our economic well being.
Lakshman Achuthan, Economic Cycle Research Institute managing director: "The numbers show that retail sales are in a clear cyclical downtrend." Just a reminder that we are a consumer-based economy.
North Carolina has lost 160,000 manufacturing jobs under Bush. A GOP presidential nominee hasn’t lost North Carolina since 1976. Edwards is the first North Carolinian on a national ticket in 140 years.
The Pension Benefit Guaranty Corp. pays benefits to about 1 million Americans and insures private pensions for approximately 43 million more. In a 29-page report by the Center On Federal Financial Institutions, the analysis revealed that the PBGC will run out of money in 2020 if current financial conditions persist. The agency’s programs ended 2003 with about $35 billion of assets, according to its annual report.
The recent study by the Center for Economic and Policy Research stated that between March 2001 and July 2004 the state of Pennsylvania lost over 81,000 jobs, or 1.4% of the total number of jobs in the state. During that three year time period, nearly 1 in 20 Pennsylvania workers lost a long-term job compared with about 1 in 25 in the nation as a whole.
Herbert Hoover: "There are only three ways to meet unpaid bills of a nation. The first is taxation. The second is repudiation. The third is inflation."
George W. Bush: "Natural gas is hemispheric. I like to call it hemispheric in nature because it is a product that we can find in our neighborhoods."
Wyeth is closing its West Chester, PA plant and 200 employees will lose their jobs. Foremost Dairies will close its plant in Hawaii. The company provides 25% of the state’s milk supply, and 120 workers will be out of jobs.
The state of Oklahoma remains more than 50,000 jobs, or 3.6%, below the June 2001 peak in seasonally adjusted employment.
The Center for Urban Economic Development at the University of Illinois-Chicago released a study yesterday showing that more than 403,000 U.S. information technology jobs have disappeared since March 2001. The report stated "the gap between the ‘two economies’…is especially pronounced in the information techology industry, where job dislocations due to ‘offshoring’ have contributed to an already hard-hit IT industry."
Grant Aldonas, U.S. undersecretary of commerce, stated he told China to expect American textile makers to seek new limits on Chinese imports as soon as next week.
In 1999, according to the Labor Dept, the average household health expenditure was $1,959, or 4.5% of income. In 2002, it had risen to $2,350 a year, or 4.8% of its income. In fact, in 2002, healthcare spending exceeded federal taxes as a percentage of household income. In late November 2004, the figures will be released for 2003. The percentages will have risen once again, and most likely equate to 5% of the average household income. It should be noted that, even with the rising cost of gasoline, nearly twice as much is spent on healthcare than on gas by the average household. When analyzing the slowing of retail sales, the key ingredient not mentioned is rising healthcare expenditures as a percentage of the average household income. Between healthcare and gas, the average consumer has no choice but to cut back. After accounting for inflation, wages and salaries and benefits are falling for the paycheck-to-paycheck consumer. The numbers work against a consumer-based economy. Going against those statistics will bring you a lot of investor hurt.
Tuesday, September 14, 2004
9/14/04 A Lesson In Branding
Pepe Escobar of the Hong Kong Asia Times: "President Bush’s crusade is a failure. ..Al Qaeda, from a business point of view, is a major success: it is a global brand and a global movement…Bin Laden is laughing. Bush’s crusade has legitimized an obscure sect as a worldwide symbol of political revolt. How could bin Laden not vote for Bush?"
The New Investors Business Daily poll shows the Bush-Kerry race tied and that the RNC bounce is fading. If investors have been pouring money into the market because they consider a Bush victory a lock, maybe they had better think twice. It’s tough to win when you have accomplished mostly negative results.
Ivan is about 500 miles south of Pensacola with top sustained winds remaining at 160 mph. The last time 3 storms hit Florida in such a short stretch of time was 1964, but those storms did not pack the same punch. Florida is the fourth-biggest state in the nation as measured by population, economic output, and worker payrolls.
It is new product day on the corporate headquarters campus at Microsoft. If any of the products are as successful at hotmail, they will have lots to cheer. There are 330 million registered hotmail users just in the U.S.
Secretary of State Powell: Regarding WMD in Iraq, he stated "I think it’s unlikely we will find any stockpiles."
LSI Logic cut its third quarter outlook citing customer inventory build-up.
Economist Arindrajit Dube with UC Berkeley’s Institute for Industrial Relations stated that, when the unemployment rate and the payroll number paint different pictures, the relationship between wage growth and productivity may be the best indicator of labor market health. Citing Labor Dept figures, Dube stated productivity grew 4% from August 2003 to August 2004, but wages after inflation actually fell during that period. He said " that is a symptom of a weak labor market."
Heating oil for October delivery is $1.206 per gallon.
OPEC is currently producing at the max- at 29.92 million barrels per day in August. In my view, with crude trading at $44.45 a barrel, and the average price on a national level for regular unleaded gas around $1.85, gas at the pump is probably underpriced by about 10 to 20 cents per gallon.
Let us not forget that Bush has made the decision to top off the Strategic Oil Reserve, which stands at 97% of capacity. The topping off will begin monthly on October 1, and continue for about eight months.
According to the Oil and Gas Journal, the U.S. has the 11th largest proved oil reserves in the world, but the U.S. is the #1 energy consumer and net importer.
Delphi closed its Flint, Michigan plant and 450 were laid off. In 2004, they have eliminated 4,925 jobs and the goal is to cut close to 6,000 by year-end. Johnson Controls closed a sun visor plant in Holland, Michigan and 800 jobs went to Mexico. Funny that Bush was in Michigan yesterday but never mentioned that.
In 2000, Bush won Ohio by 3.5 percentage points. One key reason was he garnered 59% of the vote in places like Seneca County. When Bush took office in 2001, Seneca County had 7% unemployment. Today it has risen to 10.2% and that level represents a significant threshold of pain.
John Kingston, global director of oil at Platts Survey, stated "while consumers can certainly feel encouraged by the continuing surge in OPEC output, that upward movement keeps bringing the world closer to 100% of capacity utilization. This growth in output is not showing signs of building significant amounts of inventory, and it raises the question of where the spare supply is going to come from should there be a disruption or a colder than average winter. It is important to note that we are about to begin the fourth quarter-traditionally the period of highest global demand for oil."
In order to reach a "neutral" level, San Francisco Fed’s Yellen stated the federal funds target would need to rise to between 3.5% and 4.5%, Cleveland Fed’s Pianalto used a wider range of 3% to 5%. Meanwhile, 10-year treasury notes are at 4.15%. We’ll see whether Fed governors or the market make the final determination.
Pepe Escobar of the Hong Kong Asia Times: "President Bush’s crusade is a failure. ..Al Qaeda, from a business point of view, is a major success: it is a global brand and a global movement…Bin Laden is laughing. Bush’s crusade has legitimized an obscure sect as a worldwide symbol of political revolt. How could bin Laden not vote for Bush?"
The New Investors Business Daily poll shows the Bush-Kerry race tied and that the RNC bounce is fading. If investors have been pouring money into the market because they consider a Bush victory a lock, maybe they had better think twice. It’s tough to win when you have accomplished mostly negative results.
Ivan is about 500 miles south of Pensacola with top sustained winds remaining at 160 mph. The last time 3 storms hit Florida in such a short stretch of time was 1964, but those storms did not pack the same punch. Florida is the fourth-biggest state in the nation as measured by population, economic output, and worker payrolls.
It is new product day on the corporate headquarters campus at Microsoft. If any of the products are as successful at hotmail, they will have lots to cheer. There are 330 million registered hotmail users just in the U.S.
Secretary of State Powell: Regarding WMD in Iraq, he stated "I think it’s unlikely we will find any stockpiles."
LSI Logic cut its third quarter outlook citing customer inventory build-up.
Economist Arindrajit Dube with UC Berkeley’s Institute for Industrial Relations stated that, when the unemployment rate and the payroll number paint different pictures, the relationship between wage growth and productivity may be the best indicator of labor market health. Citing Labor Dept figures, Dube stated productivity grew 4% from August 2003 to August 2004, but wages after inflation actually fell during that period. He said " that is a symptom of a weak labor market."
Heating oil for October delivery is $1.206 per gallon.
OPEC is currently producing at the max- at 29.92 million barrels per day in August. In my view, with crude trading at $44.45 a barrel, and the average price on a national level for regular unleaded gas around $1.85, gas at the pump is probably underpriced by about 10 to 20 cents per gallon.
Let us not forget that Bush has made the decision to top off the Strategic Oil Reserve, which stands at 97% of capacity. The topping off will begin monthly on October 1, and continue for about eight months.
According to the Oil and Gas Journal, the U.S. has the 11th largest proved oil reserves in the world, but the U.S. is the #1 energy consumer and net importer.
Delphi closed its Flint, Michigan plant and 450 were laid off. In 2004, they have eliminated 4,925 jobs and the goal is to cut close to 6,000 by year-end. Johnson Controls closed a sun visor plant in Holland, Michigan and 800 jobs went to Mexico. Funny that Bush was in Michigan yesterday but never mentioned that.
In 2000, Bush won Ohio by 3.5 percentage points. One key reason was he garnered 59% of the vote in places like Seneca County. When Bush took office in 2001, Seneca County had 7% unemployment. Today it has risen to 10.2% and that level represents a significant threshold of pain.
John Kingston, global director of oil at Platts Survey, stated "while consumers can certainly feel encouraged by the continuing surge in OPEC output, that upward movement keeps bringing the world closer to 100% of capacity utilization. This growth in output is not showing signs of building significant amounts of inventory, and it raises the question of where the spare supply is going to come from should there be a disruption or a colder than average winter. It is important to note that we are about to begin the fourth quarter-traditionally the period of highest global demand for oil."
In order to reach a "neutral" level, San Francisco Fed’s Yellen stated the federal funds target would need to rise to between 3.5% and 4.5%, Cleveland Fed’s Pianalto used a wider range of 3% to 5%. Meanwhile, 10-year treasury notes are at 4.15%. We’ll see whether Fed governors or the market make the final determination.
Monday, September 13, 2004
9/13/04 Between Bare Tolerance And Outright Hostility
A senior U.S. diplomat in Baghdad: "We're dealing with a population that hovers between bare tolerance and outright hostility. The idea of a functioning democracy here is crazy. We thought there would be a reprieve after sovereignty, but all hell us breaking loose." In August, there were an average of 87 attacks per day on U.S. troops. The attacks are taking place over an increasingly larger geographical area. You should seriously ask yourself who is winning this war. This is Bush's Viet Nam, and thousands and thousands of our troops will die and be wounded before the fighting ends. If you believe we invaded to rid the world of Saddam, then you need to increase your daily dosage of Prozac.
One third of U.S. oil production is located in the Gulf of Mexico. Yesterday, with Ivan approaching, Shell Oil shut down production at two sub-sea wells and took about 150 staff members off platforms in the eastern part of the Gulf.
The 2005 Old Farmer's Almanac calls for this winter to have above average snowfall and colder than normal temperatures.
Ffe Governor Susan Bies: "Our main direction is clearly up, but there's no urgency. We're not hitting all cylinders yet, and that gives us a little bit of time." We're not even close to hitting on all cylinders. This is not a Roger Federer economy.
In August 2002, U.S. Air filed for bankruptcy protection and emerged from bankruptcy in March 2003. Yesterday tey filed again for bankruptcy protetion and seek $800 million in concessions from their employees, and they number 28,000. The airline stated employees will be paid and their benefits will continue. For how long though? In my view, there are too many airlines, too many auto companies, and so on. It's only a matter of time until the less efficient disappear. It is the survival of the fittest. Hopefully, the employees impacted will have viable alternatives for earning a living. That concerns me greatly.
GM's CEO: "We've been running at the limits on inventory." GM is carrying an average of 85 days of supply of light trucks. They may have to park some of these vehicles in the Mohave next to the mothballed jets.
A senior U.S. diplomat in Baghdad: "We're dealing with a population that hovers between bare tolerance and outright hostility. The idea of a functioning democracy here is crazy. We thought there would be a reprieve after sovereignty, but all hell us breaking loose." In August, there were an average of 87 attacks per day on U.S. troops. The attacks are taking place over an increasingly larger geographical area. You should seriously ask yourself who is winning this war. This is Bush's Viet Nam, and thousands and thousands of our troops will die and be wounded before the fighting ends. If you believe we invaded to rid the world of Saddam, then you need to increase your daily dosage of Prozac.
One third of U.S. oil production is located in the Gulf of Mexico. Yesterday, with Ivan approaching, Shell Oil shut down production at two sub-sea wells and took about 150 staff members off platforms in the eastern part of the Gulf.
The 2005 Old Farmer's Almanac calls for this winter to have above average snowfall and colder than normal temperatures.
Ffe Governor Susan Bies: "Our main direction is clearly up, but there's no urgency. We're not hitting all cylinders yet, and that gives us a little bit of time." We're not even close to hitting on all cylinders. This is not a Roger Federer economy.
In August 2002, U.S. Air filed for bankruptcy protection and emerged from bankruptcy in March 2003. Yesterday tey filed again for bankruptcy protetion and seek $800 million in concessions from their employees, and they number 28,000. The airline stated employees will be paid and their benefits will continue. For how long though? In my view, there are too many airlines, too many auto companies, and so on. It's only a matter of time until the less efficient disappear. It is the survival of the fittest. Hopefully, the employees impacted will have viable alternatives for earning a living. That concerns me greatly.
GM's CEO: "We've been running at the limits on inventory." GM is carrying an average of 85 days of supply of light trucks. They may have to park some of these vehicles in the Mohave next to the mothballed jets.
Sunday, September 12, 2004
9/12/04 The Tax Holiday On Foreign-Earned Profits
If one steps back and views the global economic landscape, it would be clear that profits generated outside our borders are growing much more rapidly than those from domestic operations. A prime example would be the auto results for GM in China compared with those in the U.S. Most Americans don’t realize that those foreign profits remain overseas and are not taxed. Foreign subsidiaries of U.S. companies are holding an estimated $500 billion in cash and other liquid assets. Why? Tax provisions permit U.S. corporations to defer payment on profits made outside the U.S. so long as the profits are not brought back into our country. This stimulates the building of new plants outside our borders as well as the hiring of additional employees. It should be noted that many products made in these overseas plants are, in fact, sold in the U.S. In my view, this situation bears heavily on the election debate and focuses on the untapped ability to stimulate our economy and provide new jobs. Bush wants to keep the status quo. Kerry has a plan that makes excellent sense and is most timely. Kerry’s plan would provide corporations with a one-year window to bring those foreign profits earned over the years back to the U.S. at a tax rate of 10%. After year one, those foreign earnings would be taxed at the same corporate rate as domestic earnings, and that would be true whether they remained overseas or returned to the U.S. In a report written just last year, J.P. Morgan Chase Bank estimated that at least $300 billion could be brought back to the U.S. and 400,000 jobs would be created.
With the rising federal budget deficit, there will not be a $20 billion bailout to help the states cover Medicaid. This year the states’ share of their Medicaid costs will grow 4.6%. Next year it will increase 12%. This will create budget gaps in about 33 states for fiscal 2005, which started on July 1 for all but four states.
Mary McCarthy: "If a politician tells you he’s going to make a ‘realistic decision," you immediately understand that he’s resolved to do something bad."
The Economic Report of the President for 2004 forecast that the number of payroll jobs would rise by at least 300,000 each month in election year. When was the last time Bush didn’t "misspeak" to the American people?
On Sept. 9, with no advance warning, Shasta Regional Medical Center in Shasta, CA announced plans to begin massive layoffs by issuing a list of more than 50 names of healthcare workers slated to lose their jobs. The hospital then began meeting with the individual employees one by one to inform them of their decision. Management had refused to meet with the workers’ union, SEIU 250, which has 100,000 members and is the largest healthcare union in the western U.S.
Martin Barnes, managing editor of the Bank Credit Analyst: "If you stand back and take a structural view of the world, deflation is still a bigger threat than inflation. It is still a highly competitive world and there is still the whole Asia supply story out there. Technology is still a disinflationary force in the sense that it encourages more competition and pushes prices down. The Internet is a true force for competition and low prices…Even though the Fed has had a very stimulative policy for some time now, they haven’t really been able to create a whole lot of inflation yet. Inflation popped up in asset prices and in the housing sector in some markets, but despite their best efforts inflation has been very slow to come back. That tells you there is a deflationary tone to the world."
If one steps back and views the global economic landscape, it would be clear that profits generated outside our borders are growing much more rapidly than those from domestic operations. A prime example would be the auto results for GM in China compared with those in the U.S. Most Americans don’t realize that those foreign profits remain overseas and are not taxed. Foreign subsidiaries of U.S. companies are holding an estimated $500 billion in cash and other liquid assets. Why? Tax provisions permit U.S. corporations to defer payment on profits made outside the U.S. so long as the profits are not brought back into our country. This stimulates the building of new plants outside our borders as well as the hiring of additional employees. It should be noted that many products made in these overseas plants are, in fact, sold in the U.S. In my view, this situation bears heavily on the election debate and focuses on the untapped ability to stimulate our economy and provide new jobs. Bush wants to keep the status quo. Kerry has a plan that makes excellent sense and is most timely. Kerry’s plan would provide corporations with a one-year window to bring those foreign profits earned over the years back to the U.S. at a tax rate of 10%. After year one, those foreign earnings would be taxed at the same corporate rate as domestic earnings, and that would be true whether they remained overseas or returned to the U.S. In a report written just last year, J.P. Morgan Chase Bank estimated that at least $300 billion could be brought back to the U.S. and 400,000 jobs would be created.
With the rising federal budget deficit, there will not be a $20 billion bailout to help the states cover Medicaid. This year the states’ share of their Medicaid costs will grow 4.6%. Next year it will increase 12%. This will create budget gaps in about 33 states for fiscal 2005, which started on July 1 for all but four states.
Mary McCarthy: "If a politician tells you he’s going to make a ‘realistic decision," you immediately understand that he’s resolved to do something bad."
The Economic Report of the President for 2004 forecast that the number of payroll jobs would rise by at least 300,000 each month in election year. When was the last time Bush didn’t "misspeak" to the American people?
On Sept. 9, with no advance warning, Shasta Regional Medical Center in Shasta, CA announced plans to begin massive layoffs by issuing a list of more than 50 names of healthcare workers slated to lose their jobs. The hospital then began meeting with the individual employees one by one to inform them of their decision. Management had refused to meet with the workers’ union, SEIU 250, which has 100,000 members and is the largest healthcare union in the western U.S.
Martin Barnes, managing editor of the Bank Credit Analyst: "If you stand back and take a structural view of the world, deflation is still a bigger threat than inflation. It is still a highly competitive world and there is still the whole Asia supply story out there. Technology is still a disinflationary force in the sense that it encourages more competition and pushes prices down. The Internet is a true force for competition and low prices…Even though the Fed has had a very stimulative policy for some time now, they haven’t really been able to create a whole lot of inflation yet. Inflation popped up in asset prices and in the housing sector in some markets, but despite their best efforts inflation has been very slow to come back. That tells you there is a deflationary tone to the world."
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