6/5/08 Unemployment Rate
The unemployment rate rose to 5.5 percent last month from 5 percent, its highest level since October 2004. Some 49,000 jobs were cut from payrolls in May, up from a revised 28,000 that were lost in April.
Robert McHugh: "We believe stocks are about to fall sharply. There is the possibility of a small bounce before getting started, but stocks should be much lower a few weeks from now. We had a very small change in the McClellan Oscillator Wednesday, which means there is likely to be a large price move over the next day or two."
Russian inflation accelerated quicker than economists expected in May to the fastest pace for five and a half years as food prices soared. The inflation rate rose to 15.1 percent from 14.3 percent, the Federal Statistics Service said by e-mail today, and exceeded the 15 percent median estimate of 15 economists surveyed by Bloomberg. On the month, prices gained 1.4 percent, the same as in April. Food prices rose an annual 22.1 percent.
China's trade surplus is likely to shrink in 2008 for the first time in five years, with a rising local currency and the US economy's slowdown two of the prime reasons, the government said on Thursday.
New Zealand's central bank Governor Alan Bollard said he may cut interest rates from a record this year, triggering the biggest slump in the currency in five months.``Our forecast is consistent with the possibility of a rate cut in the third quarter,'' Bollard said in an interview from Wellington today after he kept the official cash rate unchanged at 8.25 percent. ``We may see markets decide on a softer New Zealand dollar.''
Wal-Mart Stores Inc on Thursday reported a better-than-expected 3.9 percent rise in sales at U.S. stores open at least a year in May. Wal-Mart sees June U.S. same-store sales excluding fuel up 2% to 4%.
First-time claims for unemployment benefits fell by 18,000 to 357,000 in the latest week, the Labor Department reported Thursday. The four-week average of initial claims fell by 2,750 to 368,500 in the week ending May 31. Continuing claims fell by 16,000 in the week ended May 24, dropping to 3.09 million.
Already trading at their lowest levels in more than a decade, shares of Pfizer Inc. slipped in premarket trading Thursday after a Goldman Sachs analyst cut his rating on the drug maker's stock.
In a client note, analyst James Kelly downgraded Pfizer stock to "Neutral" from "Buy," saying he expects weaker sales of key product candidates in Pfizer's pipeline. He took Pfizer shares off a portfolio of recommended stocks and replaced them with shares of Eli Lilly & Co. As an aside, yesterday there was unusual activity in the June 17.50 Pfizer puts. Just a coincidence?
Brad Hintz, who follows brokers for Sanford Bernstein: "We recommend investors remain on the sidelines with Lehman until the firm demonstrates a reduction in leverage and lowers its exposures to troubled asset classes."
According to Bloomberg, Brazil's oil discoveries, including the Western Hemisphere's largest in three decades, may cost $100 billion more to develop than the industry's most costly field. The Tupi deposit and nearby offshore prospects probably will cost $240 billion to exploit, said Peter Wells, director of U.K. research firm Neftex Petroleum Consultants Ltd. and a former Royal Dutch Shell Plc exploration manager. The total exceeds the $136 billion estimate for Kazakhstan's Kashagan field, led by Eni SpA, and would be enough to fund the U.S. space program for 14 years.
Nordstrom Inc. said Thursday its May same-store sales rose 10.9%, topping the mean estimate of analysts polled by Thomson Reuters for an increase of 8.1%. The company said it expects June same-store sales to fall 18% to 20%.
Since its March low, the S&P Utilities Sector is up nearly 10%.
According to the Oil Drum, NAFTA requires that Canada continue to export about 60% of its gas production to the US, and based on the EIA’s predictions of Canadian NG imports, it seems as if the US will be holding Canada to this clause.
European Central Bank governor Jean-Claude Trichet hinted that interest rates could rise in the euro zone next month.
Bill Bonner: "Lehman Bros. is said to be looking for $3 to $4 billion in new capital. The company has nine times as much in level 2 and level 3 assets as it has in tangible equity. And it's not the worst. Merrill Lynch's level 2 and level 3 assets equal 2,565% of its tangible equity."
A new Senate report gives a fresh shot of adrenaline to the election-year debate over the Iraq war. President Bush and his top officials deliberately misrepresented secret intelligence to make the case to invade Iraq, according to the Senate Intelligence Committee.
July crude climbed $5.49, or 4.5%, to close at $127.79 a barrel, the contract's strongest closing level since May 28. August gold fell $8.30 to close at $875.50 an ounce Thursday, its weakest closing level since May 14.
Nucor Corp. announced that it had raised its earnings expectations because of increased overseas demand.
Ford Motor Co. plans to lower salaried-related costs by 15% through white-collar job cuts, including attrition and consolidation of open positions.
Federal Reserve Bank of Richmond President Jeffrey Lacker : "The danger is that the effect of recent credit extension on the incentives of financial market participants might induce greater risk taking, which in turn could give rise to more frequent crises, in which case it might be difficult to resist further expanding the scope of central bank lending."
U.S. households lost $1.7 trillion in wealth during the first quarter as the collapse in the housing market and a weak stock market took their toll, the Federal Reserve reported Thursday. The net worth of U.S. households and nonprofits dropped at an annual rate of 11.3% in the quarter to $55.97 trillion.
According to the WSJ, Federal regulators warned that banking-industry turmoil will continue as financial institutions come to terms with piles of bad loans made to home and condo builders. Amid a dismal spring sales season for new homes, banks have begun to dump these loans at what will likely be steep discounts, setting the stage for billions of dollars in fresh losses.
Friday, June 06, 2008
Thursday, June 05, 2008
Transisition
6/4/08 Transistion
Jimmy Carter: “We live in a time of transition, an uneasy era which is likely to endure for the rest of this century. During the period we may be tempted to abandon some of the time-honored principles and commitments which have been proven during the difficult times of past generations. We must never yield to this temptation. Our American values are not luxuries, but necessities - not the salt in our bread, but the bread itself.”
BlackLight Power has invented a new primary energy source with applications to heating, distributed power generation, central power generation, and motive power based on a new chemical process of releasing the latent energy of the hydrogen atom, the BlackLight Process. In this process, the electron in an ordinary hydrogen atom is induced to move closer to the proton, below the prior-known ground state to form more stable hydrogen atoms called hydrinos. The large energy released exceeds that required to extract hydrogen from water, such that water may serve as the hydrogen fuel source for the process.
BlackLight's experimental results are published widely and have been replicated by independent groups. The process, apparatus and compositions of matter are covered by patents pending and issued. BlackLight will license companies for the commercialization of our technologies as we continue to develop new technologies related to the BlackLight Process. "The BlackLight process generates enormous amounts of cheap, non-polluting heat that will replace the thermal power of coal, oil, gas, and nuclear power plants that is then converted to energy." BlackLight Power is owned by Millsian, Inc.
Interest-rate derivatives traders are betting banks' difficulties obtaining cash to fund holdings and shore up balance sheets will worsen.The difference, or spread, between the three-month dollar London interbank offered rate, or Libor, and the overnight index swap rate, traded forward three months, is greater than similar spreads expiring this month, according to data tracked by Credit Suisse Holdings Inc.
Procter & Gamble Co. and J.M. Smucker Co. said Wednesday that they have signed an agreement to merge Procter & Gamble's Folgers coffee business into Smucker through an all-stock transaction valued at about $3.3 billion. Under the deal, Smucker will issue a one-time special dividend of $5 a share to its shareholders prior to the merger. P&G shareholders will then receive approximately 53.5% of Smucker stock in a tax-free stock-for-stock merger with P&G. Upon completion of the merger, Smucker shareholders will own about 46.5% of the combined company. Smucker said that if the transaction closes in the early part of the fourth quarter, fiscal 2009 adjusted earnings per share should come in between $3.45 and $3.50. Fiscal 2010 adjusted earnings are expected to come in between $3.62 and $3.72 a share.
The productivity of U.S. nonfarm businesses was revised just a bit higher in the first quarter than previously estimated, the Labor Department reported Wednesday. Productivity - defined as output per hour worked- rise at a 2.6% annual rate in the quarter, revised up from 2.3% in the earlier estimate a month ago. Unit labor costs rose 2.2%, revised down from 2.3%.
ADP said private employment unexpectedly grew by 40,000 jobs in May. Adding in about 20,000 jobs typically created by government, the ADP report suggests nonfarm payrolls rose by about 60,000 in May, compared to a drop of 50,000 expected by Wall Street economists. The ADP data have overshot the employment report in recent months.
United Airlines confirmed plans to reduce the number of salaried and management employees and contractors by 1,400-1,600, including the previously announced 500 employee reduction by year-end, as it removes 100 aircraft from its main fleet.
Ladenburg Thalmann Co. bank analyst Dick Bove on Wednesday slashed earnings estimates for the nation's fourth-largest bank, Wachovia Corp. Bove cut his 2008 earnings estimates to $1.30 per share from $1.80 per share trimmed his 2009 estimate to $2.91 per share from $3.14 per share. He also changed his price target on the stock to $26 from $33.
The Organization for Economic Cooperation and Development cuts its forecast Wednesday for economic growth in the United States and the 15-nation euro zone. Overall, the organization sees growth slowing across its 30 member nations to a pace of 1.8%, compared to its December forecast of 2.3%. Growth in 2007 was 2.7%. The OECD sees growth in the United States slowing to 1.2% in 2008 and 1.1% in 2009, while the pace of growth in the euro-zone is seen slowing to 1.7% in 2008 and 1.4% in 2009. U.S. growth was seen at 2.2% in 2007, while the euro zone grew by 2.6%. Japan is forecast to slow to 1.7% growth in 2008 and 1.5% in 2009 after expanding by 2.1% in 2007.
Capital spending by Japanese corporations fell 4.9% in the three months through March from a year earlier, marking the fourth straight quarter of declines, according to data released Wednesday by the Ministry of Finance in Tokyo.
Lehman Brothers Holdings Inc is looking to raise capital overseas and has approached at least one investor in South Korea, the Wall Street Journal reported on Wednesday.
More than 12,500 individuals and businesses filed for bankruptcy in Illinois in the first quarter of 2008, a 27.2 percent jump that mirrors national trends amid rising household debt. Consumer filings in the state increased 27.5 percent to 12,248, while business bankruptcies rose 14.5 percent to 260. Nationally, the total number of bankruptcies filed during the first three months of 2008 rose 26.9 percent, to 245,695, over the same period in 2007 in all bankruptcy court districts, according to data released Tuesday by the Administrative Office of the U.S. Courts.
U.S. mortgage applications fell for a third consecutive week, reaching its lowest level in over six years as demand for home refinancing loans plunged, an industry group said Wednesday.
Countrywide Financial's cumulative losses are likely to rise to between $10 billion and $12 billion, causing mark-to-market writedowns for the same amount for buyer Bank of America, Merrill Lynch said in an analyst's research note Wednesday.
Wednesday's three U.S. deaths brought to at least 4,090 the number of U.S. military personnel who have died in the Iraq war since it began in March 2003, according to an Associated Press count.
The ISM non-manufacturing index fell to 51.7% from 52.0% in April.
Shareholders of Genesco Inc.will get 0.339931 of a share of Finish Line Inc. Class A common stock for each Genesco common stock they hold as of May 30, said the specialty retailer Wednesday. It will also pay cash in lieu of any fractional shares, it said.
The American Petroleum Institute reported a rise Wednesday of 2.2 million barrels in crude supplies for the week ended May 30. The Energy Department had reported a decline of 4.8 million barrels for the latest week. Motor gasoline supplies were up 2.2 million barrels, the API said. The government had reported that supplies climbed 2.9 million barrels. Distillate supplies climbed by 4.5 million barrels, the API said. They were up 2.3 million barrels, according to the Energy Department.
Verizon is deep in talks to acquire Alltel, the nation's fifth largest wireless carrier, for roughly $27 billion, people close to the talks have told CNBC.
Lehman Brothers Holdings has slashed its risky debt holdings by as much as 25% and raised $8 billion in capital this year to shore up its balance sheet, according to an internal memo obtained by CNBC.
July crude fell $2.01, or 1.6%, to close Wednesday at $122.30 a barrel, its weakest closing level since May 6.
France Telecom said Thursday it had opened talks on a $42 billion takeover bid for TeliaSonera that would create the world's fourth-largest telecommunications operator.
Continental Airlines to cut about 3,000 positions.
U.K. house prices fell by 2.4% in May and were 3.8% lower from the same month last year, according to the Halifax house price index.
Gold for August delivery finished at $883.30 an ounce on the New York Mercantile Exchange, down $1.70, or 0.2%, on the session.
Costco Wholesale Corp. said Thursday May same-store sales rose 9 percent, which beat Wall Street expectations.
Jimmy Carter: “We live in a time of transition, an uneasy era which is likely to endure for the rest of this century. During the period we may be tempted to abandon some of the time-honored principles and commitments which have been proven during the difficult times of past generations. We must never yield to this temptation. Our American values are not luxuries, but necessities - not the salt in our bread, but the bread itself.”
BlackLight Power has invented a new primary energy source with applications to heating, distributed power generation, central power generation, and motive power based on a new chemical process of releasing the latent energy of the hydrogen atom, the BlackLight Process. In this process, the electron in an ordinary hydrogen atom is induced to move closer to the proton, below the prior-known ground state to form more stable hydrogen atoms called hydrinos. The large energy released exceeds that required to extract hydrogen from water, such that water may serve as the hydrogen fuel source for the process.
BlackLight's experimental results are published widely and have been replicated by independent groups. The process, apparatus and compositions of matter are covered by patents pending and issued. BlackLight will license companies for the commercialization of our technologies as we continue to develop new technologies related to the BlackLight Process. "The BlackLight process generates enormous amounts of cheap, non-polluting heat that will replace the thermal power of coal, oil, gas, and nuclear power plants that is then converted to energy." BlackLight Power is owned by Millsian, Inc.
Interest-rate derivatives traders are betting banks' difficulties obtaining cash to fund holdings and shore up balance sheets will worsen.The difference, or spread, between the three-month dollar London interbank offered rate, or Libor, and the overnight index swap rate, traded forward three months, is greater than similar spreads expiring this month, according to data tracked by Credit Suisse Holdings Inc.
Procter & Gamble Co. and J.M. Smucker Co. said Wednesday that they have signed an agreement to merge Procter & Gamble's Folgers coffee business into Smucker through an all-stock transaction valued at about $3.3 billion. Under the deal, Smucker will issue a one-time special dividend of $5 a share to its shareholders prior to the merger. P&G shareholders will then receive approximately 53.5% of Smucker stock in a tax-free stock-for-stock merger with P&G. Upon completion of the merger, Smucker shareholders will own about 46.5% of the combined company. Smucker said that if the transaction closes in the early part of the fourth quarter, fiscal 2009 adjusted earnings per share should come in between $3.45 and $3.50. Fiscal 2010 adjusted earnings are expected to come in between $3.62 and $3.72 a share.
The productivity of U.S. nonfarm businesses was revised just a bit higher in the first quarter than previously estimated, the Labor Department reported Wednesday. Productivity - defined as output per hour worked- rise at a 2.6% annual rate in the quarter, revised up from 2.3% in the earlier estimate a month ago. Unit labor costs rose 2.2%, revised down from 2.3%.
ADP said private employment unexpectedly grew by 40,000 jobs in May. Adding in about 20,000 jobs typically created by government, the ADP report suggests nonfarm payrolls rose by about 60,000 in May, compared to a drop of 50,000 expected by Wall Street economists. The ADP data have overshot the employment report in recent months.
United Airlines confirmed plans to reduce the number of salaried and management employees and contractors by 1,400-1,600, including the previously announced 500 employee reduction by year-end, as it removes 100 aircraft from its main fleet.
Ladenburg Thalmann Co. bank analyst Dick Bove on Wednesday slashed earnings estimates for the nation's fourth-largest bank, Wachovia Corp. Bove cut his 2008 earnings estimates to $1.30 per share from $1.80 per share trimmed his 2009 estimate to $2.91 per share from $3.14 per share. He also changed his price target on the stock to $26 from $33.
The Organization for Economic Cooperation and Development cuts its forecast Wednesday for economic growth in the United States and the 15-nation euro zone. Overall, the organization sees growth slowing across its 30 member nations to a pace of 1.8%, compared to its December forecast of 2.3%. Growth in 2007 was 2.7%. The OECD sees growth in the United States slowing to 1.2% in 2008 and 1.1% in 2009, while the pace of growth in the euro-zone is seen slowing to 1.7% in 2008 and 1.4% in 2009. U.S. growth was seen at 2.2% in 2007, while the euro zone grew by 2.6%. Japan is forecast to slow to 1.7% growth in 2008 and 1.5% in 2009 after expanding by 2.1% in 2007.
Capital spending by Japanese corporations fell 4.9% in the three months through March from a year earlier, marking the fourth straight quarter of declines, according to data released Wednesday by the Ministry of Finance in Tokyo.
Lehman Brothers Holdings Inc is looking to raise capital overseas and has approached at least one investor in South Korea, the Wall Street Journal reported on Wednesday.
More than 12,500 individuals and businesses filed for bankruptcy in Illinois in the first quarter of 2008, a 27.2 percent jump that mirrors national trends amid rising household debt. Consumer filings in the state increased 27.5 percent to 12,248, while business bankruptcies rose 14.5 percent to 260. Nationally, the total number of bankruptcies filed during the first three months of 2008 rose 26.9 percent, to 245,695, over the same period in 2007 in all bankruptcy court districts, according to data released Tuesday by the Administrative Office of the U.S. Courts.
U.S. mortgage applications fell for a third consecutive week, reaching its lowest level in over six years as demand for home refinancing loans plunged, an industry group said Wednesday.
Countrywide Financial's cumulative losses are likely to rise to between $10 billion and $12 billion, causing mark-to-market writedowns for the same amount for buyer Bank of America, Merrill Lynch said in an analyst's research note Wednesday.
Wednesday's three U.S. deaths brought to at least 4,090 the number of U.S. military personnel who have died in the Iraq war since it began in March 2003, according to an Associated Press count.
The ISM non-manufacturing index fell to 51.7% from 52.0% in April.
Shareholders of Genesco Inc.will get 0.339931 of a share of Finish Line Inc. Class A common stock for each Genesco common stock they hold as of May 30, said the specialty retailer Wednesday. It will also pay cash in lieu of any fractional shares, it said.
The American Petroleum Institute reported a rise Wednesday of 2.2 million barrels in crude supplies for the week ended May 30. The Energy Department had reported a decline of 4.8 million barrels for the latest week. Motor gasoline supplies were up 2.2 million barrels, the API said. The government had reported that supplies climbed 2.9 million barrels. Distillate supplies climbed by 4.5 million barrels, the API said. They were up 2.3 million barrels, according to the Energy Department.
Verizon is deep in talks to acquire Alltel, the nation's fifth largest wireless carrier, for roughly $27 billion, people close to the talks have told CNBC.
Lehman Brothers Holdings has slashed its risky debt holdings by as much as 25% and raised $8 billion in capital this year to shore up its balance sheet, according to an internal memo obtained by CNBC.
July crude fell $2.01, or 1.6%, to close Wednesday at $122.30 a barrel, its weakest closing level since May 6.
France Telecom said Thursday it had opened talks on a $42 billion takeover bid for TeliaSonera that would create the world's fourth-largest telecommunications operator.
Continental Airlines to cut about 3,000 positions.
U.K. house prices fell by 2.4% in May and were 3.8% lower from the same month last year, according to the Halifax house price index.
Gold for August delivery finished at $883.30 an ounce on the New York Mercantile Exchange, down $1.70, or 0.2%, on the session.
Costco Wholesale Corp. said Thursday May same-store sales rose 9 percent, which beat Wall Street expectations.
Tuesday, June 03, 2008
Keep Focused On Liquidity
6/3/08 Keep Focused On Liquidity
Talk is cheap. Lack of liquidity can be mighty expensive and create lickety quick losses in one's portfolio. Fed speak follows market direction. It does not set direction.
Bill Gross: "If the financial markets were to "readjust" to actual inflation, the stock market would lose 10% of its value and the bond market 5%."
Sen. Barack Obama of Illinois sealed the Democratic presidential nomination Tuesday.
Hedge fund investor George Soros said Tuesday the investment flood into commodity indexes bears eerie similarities to the craze for portfolio insurance which led to the stock market crash of 1987. "In both cases, the institutions are piling in on one side of the market and they have sufficient weight to unbalance it," said Soros in testimony prepared for a Senate panel on energy manipulation.
August gold dropped to a low of $878 an ounce Tuesday in New York and was last down $12.70 at $884.30, while July crude fell $1.36 to $126.40 a barrel. Federal Reserve Chairman "Ben Bernanke's dollar-supportive words had a chilling and immediate effect on both gold and oil," said Jon Nadler, an analyts at Kitco Bullion Dealers. "The commodity duo started to fall apart shortly after comments by the Fed chairman echoed the sentiment that an unwelcome rise in inflation had raised the central bank's levels of concern."
Iranian President Mahmoud Ahmadinejad said oil prices have been artificially inflated by ``capitalists'' and that crude remains plentiful.``While the growth of consumption is lower than that of production and the market is full of oil, prices are constantly on the rise and this situation is completely artificial and imposed,'' he said today at the World Food Security conference in Rome.``Powerful and international capitalists'' were working ``mendaciously to pursue their political and economic aims, while forming ``a line against the development of production and use of nuclear energy, which is clean and cheap.''
Mike Shedlock's blog: “Most funds of funds have done poorly in the past six months,” says Mick Gilligan, director of fund research at Killik & Co. “The first quarter of the year has been pretty extreme, with many managers describing it as the worst they have ever experienced.” He says that only 40-50 per cent of funds of hedge funds have generated a positive return in the past six months. The uncertainty in the market has created a difficult backdrop.“ It has been quite volatile in every sector,” says Martin Baxter, who manages a fund of hedge funds at Collins Stewart. “A lot of people are making money one day and losing it the next.”
The main obstacle for hedge funds, however, has been the sudden withdrawal of liquidity from the market.
"Internationally we're looking at a 43% inflation rate in food this year," Ed Schafer, US secretary of Agriculture, told CNBC Tuesday. Schafer said the big driving factor was energy.
Ford Motor Co said on Tuesday that U.S. sales fell 16 percent in May, driven by steep declines in sales of large trucks and sport utility vehicles. Is this the tip of the iceberg?
Venezuela expects to double its current gas production to some 11.5 billion cubic feet by 2012, the official ABN news agency reported, citing a high-level executive at state-owned oil giant PDVSA said.
A bear raid finished Bear Stearns as an independent entity. Is a bear raid taking place on Lehman Bros.?
Crude may have broken $125 on the downside; however, natural gas remains strong at $12.26.
Defense contractor SAIC Inc. said Tuesday that first-quarter profit grew 25 percent as revenue soared on U.S. military spending.
The company said its strong results and contract wins — along with share repurchases — will allow it to achieve its goal of growing per-share earnings 11 percent to 18 percen can be mighty expensive and create lickety quick losses in one's portfolio. Fed speak follows market direction. It does not set direction.
Bill Gross: "If the financial markets were to "readjust" to actual inflation, the stock market would lose 10% of its value and the bond market 5%."
Sen. Barack Obama of Illinois sealed the Democratic presidential nomination Tuesday.
Hedge fund investor George Soros said Tuesday the investment flood into commodity indexes bears eerie similaritiY�`�
Talk is cheap. Lack of liquidity can be mighty expensive and create lickety quick losses in one's portfolio. Fed speak follows market direction. It does not set direction.
Bill Gross: "If the financial markets were to "readjust" to actual inflation, the stock market would lose 10% of its value and the bond market 5%."
Sen. Barack Obama of Illinois sealed the Democratic presidential nomination Tuesday.
Hedge fund investor George Soros said Tuesday the investment flood into commodity indexes bears eerie similarities to the craze for portfolio insurance which led to the stock market crash of 1987. "In both cases, the institutions are piling in on one side of the market and they have sufficient weight to unbalance it," said Soros in testimony prepared for a Senate panel on energy manipulation.
August gold dropped to a low of $878 an ounce Tuesday in New York and was last down $12.70 at $884.30, while July crude fell $1.36 to $126.40 a barrel. Federal Reserve Chairman "Ben Bernanke's dollar-supportive words had a chilling and immediate effect on both gold and oil," said Jon Nadler, an analyts at Kitco Bullion Dealers. "The commodity duo started to fall apart shortly after comments by the Fed chairman echoed the sentiment that an unwelcome rise in inflation had raised the central bank's levels of concern."
Iranian President Mahmoud Ahmadinejad said oil prices have been artificially inflated by ``capitalists'' and that crude remains plentiful.``While the growth of consumption is lower than that of production and the market is full of oil, prices are constantly on the rise and this situation is completely artificial and imposed,'' he said today at the World Food Security conference in Rome.``Powerful and international capitalists'' were working ``mendaciously to pursue their political and economic aims, while forming ``a line against the development of production and use of nuclear energy, which is clean and cheap.''
Mike Shedlock's blog: “Most funds of funds have done poorly in the past six months,” says Mick Gilligan, director of fund research at Killik & Co. “The first quarter of the year has been pretty extreme, with many managers describing it as the worst they have ever experienced.” He says that only 40-50 per cent of funds of hedge funds have generated a positive return in the past six months. The uncertainty in the market has created a difficult backdrop.“ It has been quite volatile in every sector,” says Martin Baxter, who manages a fund of hedge funds at Collins Stewart. “A lot of people are making money one day and losing it the next.”
The main obstacle for hedge funds, however, has been the sudden withdrawal of liquidity from the market.
"Internationally we're looking at a 43% inflation rate in food this year," Ed Schafer, US secretary of Agriculture, told CNBC Tuesday. Schafer said the big driving factor was energy.
Ford Motor Co said on Tuesday that U.S. sales fell 16 percent in May, driven by steep declines in sales of large trucks and sport utility vehicles. Is this the tip of the iceberg?
Venezuela expects to double its current gas production to some 11.5 billion cubic feet by 2012, the official ABN news agency reported, citing a high-level executive at state-owned oil giant PDVSA said.
A bear raid finished Bear Stearns as an independent entity. Is a bear raid taking place on Lehman Bros.?
Crude may have broken $125 on the downside; however, natural gas remains strong at $12.26.
Defense contractor SAIC Inc. said Tuesday that first-quarter profit grew 25 percent as revenue soared on U.S. military spending.
The company said its strong results and contract wins — along with share repurchases — will allow it to achieve its goal of growing per-share earnings 11 percent to 18 percen can be mighty expensive and create lickety quick losses in one's portfolio. Fed speak follows market direction. It does not set direction.
Bill Gross: "If the financial markets were to "readjust" to actual inflation, the stock market would lose 10% of its value and the bond market 5%."
Sen. Barack Obama of Illinois sealed the Democratic presidential nomination Tuesday.
Hedge fund investor George Soros said Tuesday the investment flood into commodity indexes bears eerie similaritiY�`�
Discomfort
6/2/08 Discomfort
Avoiding an ugly convention battle, or a divisive general election turnout, is the main objective, said Sen. Claire McCaskill, D-Mo., who believes Clinton will "do the right thing, because the stakes are way too high for America. "I have great confidence that Hillary Clinton will do what's right for our party and for our nation and for all those people out there that are hurting - and are going to keep hurting if we let four more years of George Bush in the White House. That's what we'd get with John McCain."
If Barack Obama were to choose Hillary Clinton as his running mate, that would ensure at least another four years of Bill Clinton hovering over the White House. Scums that get impeached should not receive a reprieve without a pardon from the American voters, and that will not take place.
Shares of ImClone Systems Inc. fell in premarket trading Monday as investors took a dim view of trial data for its drug Erbitux as a treatment for lung cancer and colorectal cancer.
Shares of Novartis AG rallied on news that studies have shown its bone cancer drug Zometa and drug candidate RAD001 both showed promise in the treatment of breast cancer.
In East Oakland, a Comcast cable technician paid $180,000 for a bungalow that sold in 2006 for 2 1/2 times that amount. In Vallejo, a young couple bought a four-bedroom split-level for $335,000, less than half its price two years ago. In East Palo Alto, an X-ray technician, along with her mother, aunt and boyfriend, just moved into a four-bedroom rancher that cost $390,000, 44 percent less than a couple of years ago. All three houses were foreclosed properties being sold by the lenders that repossessed them.
In a bid to boost its Web search traffic, Microsoft Corp. on Monday announced a deal that will make its Live Search the default on Hewlett-Packard Co. personal computers shipped in the U.S. and Canada, starting in January. The deal also calls for HP, the world's largest PC maker, to install copies of Internet Explorer with an extra Live Search toolbar on those computers. Microsoft said the toolbar also links to HP services such as its Snapfish digital photo printing site.
The total number of contracts, owned by hedge funds and futures traders, betting on a decline in the dollar against major currencies net of those betting on a gain numbered 201,103 on May 27 from 147,887 on Dec. 31, figures from the Commodity Futures Trading Commission show.
As the dollar has risen against the euro, coal exports to Europe have risen and helped fuel the rise in railroad stocks. If one believes the dollar will gain against euro over the next 6 to 12 months, then one might consider buying puts on the railroad stocks. If wrong, what would be the downside risk? In my view, limited
The Commerce Department reported that construction activity fell by 0.4 percent in April after having been down 0.6 percent in March. Construction has not increased since last September as the building industry continues to be battered by the worst slump in housing in decades.
China's central bank cautioned against ``exaggerating'' a slowdown in demand for the nation's exports, signaling that it won't loosen monetary policy.The comment was in a report by the bank's financial research institute, assessing the economic impact of the May 12 Sichuan earthquake. It was sent to Bloomberg News via e-mail. China faces inflation close to a 12-year high and weakening global demand for exports. Today's report shows the People's Bank of China regards the danger from rising prices, a problem exacerbated by the quake, as the bigger threat to the world's fastest-growing major economy.
A cancer vaccine more than doubled the survival time of people with the most common and deadly type of brain tumor, U.S. researchers said. The vaccine, made by Avant Immunotherapeutics and licensed by drug giant Pfizer, enlists the help of the immune system to attack the tumor.
Staection turnout, is the main objective, said Sen. Claire McCaskill, D-Mo., who believes Clinton will "do the right thing, because the stakes are way too high for America. "I have great confidence that Hillary Clinton will do what's right for our party and for our nation and for all those people out there that are hurting - and are going to keep hurting if we let four more years of George Bush in the White House. That's what we'd get with John McCain."
If Barack Obama were to choose Hillary Clinton as his running �q�
Avoiding an ugly convention battle, or a divisive general election turnout, is the main objective, said Sen. Claire McCaskill, D-Mo., who believes Clinton will "do the right thing, because the stakes are way too high for America. "I have great confidence that Hillary Clinton will do what's right for our party and for our nation and for all those people out there that are hurting - and are going to keep hurting if we let four more years of George Bush in the White House. That's what we'd get with John McCain."
If Barack Obama were to choose Hillary Clinton as his running mate, that would ensure at least another four years of Bill Clinton hovering over the White House. Scums that get impeached should not receive a reprieve without a pardon from the American voters, and that will not take place.
Shares of ImClone Systems Inc. fell in premarket trading Monday as investors took a dim view of trial data for its drug Erbitux as a treatment for lung cancer and colorectal cancer.
Shares of Novartis AG rallied on news that studies have shown its bone cancer drug Zometa and drug candidate RAD001 both showed promise in the treatment of breast cancer.
In East Oakland, a Comcast cable technician paid $180,000 for a bungalow that sold in 2006 for 2 1/2 times that amount. In Vallejo, a young couple bought a four-bedroom split-level for $335,000, less than half its price two years ago. In East Palo Alto, an X-ray technician, along with her mother, aunt and boyfriend, just moved into a four-bedroom rancher that cost $390,000, 44 percent less than a couple of years ago. All three houses were foreclosed properties being sold by the lenders that repossessed them.
In a bid to boost its Web search traffic, Microsoft Corp. on Monday announced a deal that will make its Live Search the default on Hewlett-Packard Co. personal computers shipped in the U.S. and Canada, starting in January. The deal also calls for HP, the world's largest PC maker, to install copies of Internet Explorer with an extra Live Search toolbar on those computers. Microsoft said the toolbar also links to HP services such as its Snapfish digital photo printing site.
The total number of contracts, owned by hedge funds and futures traders, betting on a decline in the dollar against major currencies net of those betting on a gain numbered 201,103 on May 27 from 147,887 on Dec. 31, figures from the Commodity Futures Trading Commission show.
As the dollar has risen against the euro, coal exports to Europe have risen and helped fuel the rise in railroad stocks. If one believes the dollar will gain against euro over the next 6 to 12 months, then one might consider buying puts on the railroad stocks. If wrong, what would be the downside risk? In my view, limited
The Commerce Department reported that construction activity fell by 0.4 percent in April after having been down 0.6 percent in March. Construction has not increased since last September as the building industry continues to be battered by the worst slump in housing in decades.
China's central bank cautioned against ``exaggerating'' a slowdown in demand for the nation's exports, signaling that it won't loosen monetary policy.The comment was in a report by the bank's financial research institute, assessing the economic impact of the May 12 Sichuan earthquake. It was sent to Bloomberg News via e-mail. China faces inflation close to a 12-year high and weakening global demand for exports. Today's report shows the People's Bank of China regards the danger from rising prices, a problem exacerbated by the quake, as the bigger threat to the world's fastest-growing major economy.
A cancer vaccine more than doubled the survival time of people with the most common and deadly type of brain tumor, U.S. researchers said. The vaccine, made by Avant Immunotherapeutics and licensed by drug giant Pfizer, enlists the help of the immune system to attack the tumor.
Staection turnout, is the main objective, said Sen. Claire McCaskill, D-Mo., who believes Clinton will "do the right thing, because the stakes are way too high for America. "I have great confidence that Hillary Clinton will do what's right for our party and for our nation and for all those people out there that are hurting - and are going to keep hurting if we let four more years of George Bush in the White House. That's what we'd get with John McCain."
If Barack Obama were to choose Hillary Clinton as his running �q�
Monday, June 02, 2008
Not Out Of The Woods
6/1/08 Not Out Of The Woods
Allis-Chalmers Energy Inc.said it'll offer $489 million in cash and stock to buy Bronco Drilling, about $50 million higher than its Jan. 24 offer of $438 million. Under the new terms, Bronco Drilling will receive aggregate merger consideration comprised of $200 million in cash and 16.85 million shares of Allis-Chalmers common stock. The combined consideration has a value of $18.25 per share of Bronco Drilling common stock based on the closing price of Allis-Chalmers' common stock on May 30. Allis-Chalmers shares closed at $17.17 on Friday. Bronco Drilling ended the day at $18.18.
A profit warning from British lender Bradford and Bingley resurrected concerns that weak housing markets around the globe will take a toll on economic growth.
The fallout from the troubles at Chrysler and GMAC could extend beyond Cerberus Capital Management amid news the buy-out firm has sold "significantly" more than half its equity to about 90 investors, according to a Financial Times report Monday.
Sales of semiconductor chips rose 5.9% to $21.2 billion in April compared with a year earlier, the Semiconductor Industry Association said Monday.
Loan financing for InBev's potential takeover of Anheuser-Busch Cos Inc looks uncertain as a tight loan market may not bear such huge acquisition funding, bankers told Reuters Loan Pricing Corp.
Marriott International Inc. Chairman and Chief Executive J.W. Marriott Jr. said the company's international business remains strong, but the U.S. market has been weakened by softer demand trends.
Defense contractor Harris Corp. decided to remain independent after considering acquisition offers that were below what the company's board believes to be its value.
The nation's manufacturers continued to cut back production in May, but at a slower rate than over the past three months, the Institute for Supply Management reported Monday. The ISM index inched higher to 49.6% in May from 48.6% in April. This is the fourth straight month the index has been below 50%. The size of the rise was unexpected.
According to the Financial Times, the Cleveland Fed’s measure of 10-year-ahead inflation, based on the yield on Treasury inflation-protected securities, stands at just under 3.5 per cent. The University of Michigan’s consumer survey puts the one-year-ahead expectation of inflation at more than 5 per cent – not exactly a vote of confidence in Ben Bernanke, Fed chairman, and his team.
Toyota, the world's top-selling carmaker, is considering downgrading its US sales forecast to account for a worsening outlook for pick-up trucks and other big vehicles in its largest market.
Tim Wood: "Now the question is: Are we operating within the context of a bull market and was the bearish primary trend change that occurred on November 21st another "false" signal like the one surrounding the 2000 top? In addressing this topic I must first state that I believe without a doubt that the Dow theory bearish primary trend change that occurred in association with the 2000 top marked the first phase a secular bear market. But, given the efforts to save the world I also believe that because of the massive manipulation the market was resurrected from the grips of the bear. As I have said all along, manipulation only serves to make matters worse and will ultimately fail. As a result of the manipulative efforts we saw not only the resurrection of the equity markets, we were also blessed with a housing bubble, an ongoing banking and credit crisis and now a commodity bubble. Point, being, the manipulative efforts have, just as I have said all along, only served to make matters worse. Rising commodity prices are now literally bringing the American consumer and small business owner to his knees and I continue to believe that the advance we have seen in commodities has been largely speculative driven. Also, there are statistical developments coming down the pipe in the not too distant future that will either tell us that the commodity boom is over, or that we are going to have years of pain left to endure. This will all be covered in great detail as it unfolds in my newsletters and short-term updates. I can tell you now that if the statistics unfold in a matter that confirms further inflation, then things are going to get a lot worse before they get better. Anyway, that benchmark is nearing and which side of the fence this statistic falls on will have far reaching implications."
John Hussman: "For now, we remain tightly hedged, since the overall profile of valuations and market action remains unfavorable. As I noted a couple of weeks ago, “The reality is that as recessions develop (and I continue to believe the U.S. faces a much more significant downturn than we've observed to date), the data can take months to accumulate to a compelling verdict, and in the meantime, speculative pressures can remain alive.” Lest investors allow the weak but benign economic reports to create an “all clear” impression for the economy, the latest FDIC Quarterly Banking Profile, released last week, should encourage them not to close their ears and hum. I have to say that having read these regularly since the early 1990's, this is easily the most dismal report I've ever seen."
Allis-Chalmers Energy Inc.said it'll offer $489 million in cash and stock to buy Bronco Drilling, about $50 million higher than its Jan. 24 offer of $438 million. Under the new terms, Bronco Drilling will receive aggregate merger consideration comprised of $200 million in cash and 16.85 million shares of Allis-Chalmers common stock. The combined consideration has a value of $18.25 per share of Bronco Drilling common stock based on the closing price of Allis-Chalmers' common stock on May 30. Allis-Chalmers shares closed at $17.17 on Friday. Bronco Drilling ended the day at $18.18.
A profit warning from British lender Bradford and Bingley resurrected concerns that weak housing markets around the globe will take a toll on economic growth.
The fallout from the troubles at Chrysler and GMAC could extend beyond Cerberus Capital Management amid news the buy-out firm has sold "significantly" more than half its equity to about 90 investors, according to a Financial Times report Monday.
Sales of semiconductor chips rose 5.9% to $21.2 billion in April compared with a year earlier, the Semiconductor Industry Association said Monday.
Loan financing for InBev's potential takeover of Anheuser-Busch Cos Inc looks uncertain as a tight loan market may not bear such huge acquisition funding, bankers told Reuters Loan Pricing Corp.
Marriott International Inc. Chairman and Chief Executive J.W. Marriott Jr. said the company's international business remains strong, but the U.S. market has been weakened by softer demand trends.
Defense contractor Harris Corp. decided to remain independent after considering acquisition offers that were below what the company's board believes to be its value.
The nation's manufacturers continued to cut back production in May, but at a slower rate than over the past three months, the Institute for Supply Management reported Monday. The ISM index inched higher to 49.6% in May from 48.6% in April. This is the fourth straight month the index has been below 50%. The size of the rise was unexpected.
According to the Financial Times, the Cleveland Fed’s measure of 10-year-ahead inflation, based on the yield on Treasury inflation-protected securities, stands at just under 3.5 per cent. The University of Michigan’s consumer survey puts the one-year-ahead expectation of inflation at more than 5 per cent – not exactly a vote of confidence in Ben Bernanke, Fed chairman, and his team.
Toyota, the world's top-selling carmaker, is considering downgrading its US sales forecast to account for a worsening outlook for pick-up trucks and other big vehicles in its largest market.
Tim Wood: "Now the question is: Are we operating within the context of a bull market and was the bearish primary trend change that occurred on November 21st another "false" signal like the one surrounding the 2000 top? In addressing this topic I must first state that I believe without a doubt that the Dow theory bearish primary trend change that occurred in association with the 2000 top marked the first phase a secular bear market. But, given the efforts to save the world I also believe that because of the massive manipulation the market was resurrected from the grips of the bear. As I have said all along, manipulation only serves to make matters worse and will ultimately fail. As a result of the manipulative efforts we saw not only the resurrection of the equity markets, we were also blessed with a housing bubble, an ongoing banking and credit crisis and now a commodity bubble. Point, being, the manipulative efforts have, just as I have said all along, only served to make matters worse. Rising commodity prices are now literally bringing the American consumer and small business owner to his knees and I continue to believe that the advance we have seen in commodities has been largely speculative driven. Also, there are statistical developments coming down the pipe in the not too distant future that will either tell us that the commodity boom is over, or that we are going to have years of pain left to endure. This will all be covered in great detail as it unfolds in my newsletters and short-term updates. I can tell you now that if the statistics unfold in a matter that confirms further inflation, then things are going to get a lot worse before they get better. Anyway, that benchmark is nearing and which side of the fence this statistic falls on will have far reaching implications."
John Hussman: "For now, we remain tightly hedged, since the overall profile of valuations and market action remains unfavorable. As I noted a couple of weeks ago, “The reality is that as recessions develop (and I continue to believe the U.S. faces a much more significant downturn than we've observed to date), the data can take months to accumulate to a compelling verdict, and in the meantime, speculative pressures can remain alive.” Lest investors allow the weak but benign economic reports to create an “all clear” impression for the economy, the latest FDIC Quarterly Banking Profile, released last week, should encourage them not to close their ears and hum. I have to say that having read these regularly since the early 1990's, this is easily the most dismal report I've ever seen."
Sunday, June 01, 2008
Expectations
5/31/08 Expectations
Americans expect prices to rise by a median of 3.4% a year during the next five to 10 years, the highest expectation since 1995, according to the latest Reuters/University of Michigan consumer-sentiment survey, released Friday. The number was 2.9% as recently as March. More worrisome, consumers, on average, expect prices to increase 5.2% in the next 12 months, the highest level for an expected rise since 1982.
European Central Bank council member Mario Draghi said record oil prices are dictating the level of borrowing costs.``The main element of concern remains the continued rise in the price of energy and other commodities,'' Draghi said today at the Bank of Italy's annual assembly. This is ``fueling inflation and limiting the direction of monetary policy. Medium- term price stability was and remains the objective.''
The weak U.S. dollar, market speculation and the subprime crisis are the causes for the spiraling price of oil, OPEC's current president said Saturday. Algerian Energy Minister Chakib Khelil told reporters the cartel will make no new decision on production levels until its Sept. 9 meeting in Vienna. He notes that OPEC controls only 40 percent of world oil production
Australia, a staunch U.S. ally and one of the first countries to commit troops to the Iraq war five years ago, ended combat operations there Sunday, a Defense Department official said.
U.S. Treasury Secretary Henry Paulson said Sunday that there was no quick fix to high oil prices, which he called an issue of supply and demand.Paulson said inflation in the Gulf is "significant" but suggested that Gulf countries pegging their currencies to the weak dollar was not the only reason for it. He said it was a "sovereign decision" by each country whether it wants to de-peg its currency from the dollar.
The Democratic Party's rules commmitte voted Saturday to seat the Michigan delegation to the Denver convention at half strength, and give Sen. Hillary Clinton 34.5 votes and Barack Obama 29.5 votes. The committee had voted earlier Saturday to seat Florida's delegation at half strength as well.
Belgium's InBev NV is close to securing a $50 billion financing package to enable it to launch a takeover bid for Anheuser-Busch Cos Inc , maker of Budweiser beer, the Sunday Telegraph reported.
JPMorgan Chase & Co said on Saturday it completed its $1.4 billion Bear Stearns Cos takeover.
Obama resigned his longtime membership at a Chicago church in the aftermath of inflammatory remarks by his former pastor and recent fiery comments at the church by a visiting priest.
Russian Prime Minister Vladimir Putin compared the U.S. to a ``frightening monster'' and urged France to distance itself from its American ally.``How can one be such a shining example of democracy at home and a frightening monster abroad?'' Putin said in an interview with French newspaper Le Monde transmitted live to journalists in Paris yesterday. Putin, speaking the day after meeting French President Nicolas Sarkozy, said the U.S. was creating ``new Berlin Walls'' in Europe by pushing the North Atlantic Treaty Organization to expand into ex-Soviet states Georgia and Ukraine.
Mike Burk: "The market is over bought. As of Friday all of the major indices were up for 4 consecutive days...It is encouraging to see the small cap indices and indicators outperforming their large cap counterparts. But, with the indicators deteriorating, the intermediate term future does not look encouraging... June is the strongest month of the 4th year (in the presidential cycle)...I expect the major indices to be lower on Friday June 6 than they were on Friday May 30."
Americans expect prices to rise by a median of 3.4% a year during the next five to 10 years, the highest expectation since 1995, according to the latest Reuters/University of Michigan consumer-sentiment survey, released Friday. The number was 2.9% as recently as March. More worrisome, consumers, on average, expect prices to increase 5.2% in the next 12 months, the highest level for an expected rise since 1982.
European Central Bank council member Mario Draghi said record oil prices are dictating the level of borrowing costs.``The main element of concern remains the continued rise in the price of energy and other commodities,'' Draghi said today at the Bank of Italy's annual assembly. This is ``fueling inflation and limiting the direction of monetary policy. Medium- term price stability was and remains the objective.''
The weak U.S. dollar, market speculation and the subprime crisis are the causes for the spiraling price of oil, OPEC's current president said Saturday. Algerian Energy Minister Chakib Khelil told reporters the cartel will make no new decision on production levels until its Sept. 9 meeting in Vienna. He notes that OPEC controls only 40 percent of world oil production
Australia, a staunch U.S. ally and one of the first countries to commit troops to the Iraq war five years ago, ended combat operations there Sunday, a Defense Department official said.
U.S. Treasury Secretary Henry Paulson said Sunday that there was no quick fix to high oil prices, which he called an issue of supply and demand.Paulson said inflation in the Gulf is "significant" but suggested that Gulf countries pegging their currencies to the weak dollar was not the only reason for it. He said it was a "sovereign decision" by each country whether it wants to de-peg its currency from the dollar.
The Democratic Party's rules commmitte voted Saturday to seat the Michigan delegation to the Denver convention at half strength, and give Sen. Hillary Clinton 34.5 votes and Barack Obama 29.5 votes. The committee had voted earlier Saturday to seat Florida's delegation at half strength as well.
Belgium's InBev NV is close to securing a $50 billion financing package to enable it to launch a takeover bid for Anheuser-Busch Cos Inc , maker of Budweiser beer, the Sunday Telegraph reported.
JPMorgan Chase & Co said on Saturday it completed its $1.4 billion Bear Stearns Cos takeover.
Obama resigned his longtime membership at a Chicago church in the aftermath of inflammatory remarks by his former pastor and recent fiery comments at the church by a visiting priest.
Russian Prime Minister Vladimir Putin compared the U.S. to a ``frightening monster'' and urged France to distance itself from its American ally.``How can one be such a shining example of democracy at home and a frightening monster abroad?'' Putin said in an interview with French newspaper Le Monde transmitted live to journalists in Paris yesterday. Putin, speaking the day after meeting French President Nicolas Sarkozy, said the U.S. was creating ``new Berlin Walls'' in Europe by pushing the North Atlantic Treaty Organization to expand into ex-Soviet states Georgia and Ukraine.
Mike Burk: "The market is over bought. As of Friday all of the major indices were up for 4 consecutive days...It is encouraging to see the small cap indices and indicators outperforming their large cap counterparts. But, with the indicators deteriorating, the intermediate term future does not look encouraging... June is the strongest month of the 4th year (in the presidential cycle)...I expect the major indices to be lower on Friday June 6 than they were on Friday May 30."
Subscribe to:
Posts (Atom)