Best Week in 34 Years

Just received this via Fox Business: DOW SOARS 11.3% THIS WEEK; BEST WEEKLY PERFORMANCE SINCE OCTOBER 1974.

So, worst month, best week, and who needs a beer?

Worst Month in 21 Years

• Worst October in 21 years. The DOW lost 14.1% and the SP500 was down 16.6%.
• 21 is also the drinking age. Coincidence?
• Always the topper, oil did have its biggest monthly drop ever. 35%.
• I did go to Hooters for lunch. Jam-packed. No recession there. The Hooters waitresses were in costumes. At my table we were served by a lady bug. I swore she was going to knock some drinks over with those wings!
• McCain thinks that he is coming back strong. His words. Well, he's got a lot of coming back to do. Today's whatever poll has Obama up more than the margin of error, but does note that the undecided vote may be around 14%.
• Of course, folks like to hop on the bandwagon. Like all those Phillies fans that suddenly showed up in your office this week. So a lot of the undecideds could run to the presumed winner, Barack Obama.

Happy Halloween!

The market up just a smidge here on Halloween. You'd think with all the sugar folks are consuming, we'd see some wild swings from highs to lows! $$

The End of October

• They were saying this morning on bubble vision that this has been the worst October since 1987. Yikes.
• Month-end means 401k adds to whatever folks are dollar-cost-averaging into these days. Does the coffee can buried in the back yard qualify for your 401k program?
• Hopefully, folks are staying the course. But I get the feeling that many have been diverting money out of equities and into something safer. Bad timing? Probably. But that's what they do.

The Sounds of Silence

• Lowest watched World Series in TV history.
• And as Joe Biden knows, the last time TV viewership was that low was when FDR was going on TV in 1929 or 1933 to tell folks about the economy.
• Yo Joe, FDR couldn't complete with the 1929 MTV top Dixieland hits, babe.

Candy at the Ready

• Candy as in sweets, not as in the stripper at the local club!
• The strategy tonight is to hand out the crappy candy first, and hope that the kids call it a night before I have to open the Baby Ruths. Those are mine!
• Making a lunch run to the local Hooters for lunch. I'll snap some low-res pics with the phone if they're willing. I imagine they're dressed up today. And if not, at least they'll be dressed up as Hooters waitresses!

Again from the cellphone. Using my bluetooth keyboard and PocketHTMLNet to attempt to create some sort of formatting...

A Negative GDP Rally!

The market celebrated the negative GDP news. Let me guess, bargain hunters? The GDP came in at a -.3%, which was a little better than the forecast. But for those who want to pin another recession on George W. Bush, it looks like we have one of our required two consecutive quarters of negative GDP growth in the books.

But the market has already come down 40%. The stock market has forecasted that the economy would be in some sort of slowdown.

We are also in the end of month strength period, as 401k money gets put somewhere. If folks are still doing that these days. The fear is so thick out there, I'm wondering if folks are just spending the money while they can. Carpe diem and all.

The Sacramento Kings lost a thriller in Minnesota last night after a big surge to close within two. That turned out to be the final score as Kevin Martin missed a jumper near the end of the game to put that one in the books for the TWolves.

And I actually watched an NBA game in October. As a Lakers fan, I normally just wait until the 82-game pre-season winds down in April... Bah.

I'm trying to avoid the candy in the office here at the Fun Factory. Not very successful.

Obama with a crazy lead over McCain. I was listening to the Dennis Miller show yesterday and the callers are down to hoping that the polls are wrong or that folks are answering incorrectly to not appear racist.

Obama is going to win in a landslide, folks. That's not the way I'm voting, but I think we need to hope that he does well. He will be our President. It's in all of our interest that he does well.

Again, not the normal formatting, but tapping this out on my cellphone via a pretty nice bluetooth keyboard. Blogger by email doesn't work well with HTML, but at least I can embed a pic. And why not a pic of Timberwolves cheerleaders?

Expectation Thursday

When the market gapped up this morning, my first thought was there was gong to be one heck of a reversal at some point during the day to bring us down into negative territory. I think we've all come to be suspicious of any 2% or 3% move in this age of 7% intraday swings.

I'm again sending this via email to Blogger, so forgive the formatting.

And Sheena was eliminated last night from America's Next Top Model. Too sexy to be a model. At least that kind of model. Marjorie keeps on going, and she's very gangly and non-sexy, imho. But maybe that's what high fasihion is all about?

Phillies Win World Series Randomosity

Congratulations to the Philadelphia Phillies! Maybe all baseball games should be 3-innings long...

• As gas prices come down, driving goes up. The sharp decline in gasoline use earlier this year — with volume down nearly 10 percent in some weeks — suggested to many people, including the automobile companies, that a permanent change in American habits might be at hand. But with gasoline prices falling drastically in recent weeks, some American drivers are returning to their old ways.
• Gas prices coming down are like a big tax cut for the consumer.  It's like another stimulus package!
• Barack Obama mixes up his black sitcom references.  “If Senator McCain is elected, we’ll have another president who wants to privatize part of your Social Security. Could you imagine if you had your Social Security invested in the stock market these last two weeks, these last two months? You wouldn’t need Social Security. You’d be having a — like, what was it, Sanford and Son. `I’m coming Weezie!”
• Weezie is from The Jeffersons. 
• An interest rate of zero could be coming. 

A growing number of analysts now predict that the economy is so weak that the Fed will have to reduce its official target to zero if it wants to jumpstart the stalled economy.

Japan’s central bank reduced its benchmark interest rate to zero for five years, from 2001 to 2006. It did so mainly to combat a particularly persistent case of deflation, a broad-based decline in consumer prices, and to revive economic growth.

Some analysts see signs that the United States faces a similar threat. Like Japan’s, American banks have become so decimated by losses in real estate that they are either unable or unwilling to resume normal lending. And as prices for oil and many other commodities have crashed during the past two weeks, some analysts now warn that deflation might be a threat here as well.

• I wonder how many episodes of The Jeffersons McCain has seen?
• But the biggest news of the day isn't the Phillies, Weezie, or the latest poll numbers.  The Beatles may be joining Rock Band.

Wed Randomosity

The market is crazy. Just crazy. Did you watch the last few minutes on TV? Straight down. The gains that looked like they might hold evaporated.

Black Ice

• Yahoo Finance said yesterday that bargain hunting sent the market higher. today? Profit taking.
• The Fed cut rates by .5% down to 1%. That's pretty low.
• "Downside risks to growth remain." So say one, so say we all. GDP out later this week, and -.5% is best guess right now. Folks who hate Bush can't seem to wait for the official definition of a recession to come true. (Two negative quarters of GDP). Don't want that on Obama's watch, after all...

Gimme Free

• Say, using your iPhone at a Starbucks, for no more than two hours a day, is FREE!
• Hey Bernanke, FREE is better than 1%.
• Don't you think long-term rates will be coming down?

The Glass is Half-Full

• Netflix to offer HD streaming on all streaming devices (XBOX, Roku, etc). Just 300 at first. But you know more will be coming.
• Buying a Netbook and concerned about battery life? Solid-state drives a better choice than the hard-disks.

Follow Through Day Update!

Just a heads up that IBD called yesterday a follow through day. The last few have been whipsaws, but one of these days will be the one that works.

Also, Lakers have a perfect record. They're on pace to set an NBA record for number of wins and fewest amount of losses.

The (Market) Surge is Working!

As John McCain might say, the suirge is working! The stock market surged 10% today because:

A) George Bush said he was suspending the election and was going to serve a third term.

B) Jim Cramer's 17th call of "the bottom" convinced investors that it was time to go long.

C) The Chicago Bulls cheerleaders, the Luvabulls, said that they were going to help homeowners struggling to make payments by raising money with a bikini car wash.

D) Yahoo Finance says, 'Bargain hunting."

What a day. Incredible finish. Of course, we all do realize that the biggest up days tend to happen in bear markets as countertrend moves, right? But it was nice... I'm still long of course.

Trying to blog via email from the cell phone.

Luvabull but H8abear

The NBA season starts tonight. I was out last night and forgot that I had an online fantasy basketball draft. So Yahoo auto-picked for me. I think the software did a good job.

• There is always a bull market somewhere, right? How about in the US dollar?
• Consumer confidence fell to a record low in October at 38. The stock market has been down 19 days so far, and there are four more closes to go...
• Wal-Mart to offer songs for 74-cents. Cross platform compatible! Uh-oh, Apple. Of course, it'll be the ease of use that makes or breaks this.
• Somebody scheduled a meeting over lunch again. Why? Well, it's the only time people are available! Newsflash. It's called lunch. People are not available. But what can you do when you're stuck workin' for the man...

It's the Last Five Minutes, Stupid!

It's the last five minutes that matter. Take last night's game between the Colts-Titans. When Manning plunged across the goal line, I lost by 1.5 points in my Fantasy Football game.

• Meanwhile, the stock market gapped up this moring because of "incredible bargains" in stock prices. I didn't hear a bell ring announcing that these were the valuations to buy, did you?
• Since the open the market has mostly trended a bit down. Uh huh. Watch that last thirty minutes. Or even five minutes.
• The World Series game last night was postponed because of winter. Er, weather. C'mon, what do folks expect in Philadelphia at the end of October? Maybe they wan't be able to resume playing until May!
• So I went to bring some leftovers in for lunch. Can I find a match between a plastic bowl and lid? No. I have lids. I have bowls. But no matching set. What happened there? I guess I will just go out to lunch and have leftovers later.
• And that certainly wouldn't have happened if the Supreme Court didn't steal the election in 2000 for Bush. Obama will fix this next year. Everyone will have matching Tupperware.

Monday Afternoon Thoughts

• About thirty minutes before the close, the sellers took over and drove the market down. Not good that this is the kind of late-day action that we are seeing.
• Meanwhile, the Phillies are up 3-1 in the World Series. At least Phillies fans have a reason to be happy.
• After the bell, Xerox announces that they're going to cut 3000 jobs. Seems to me that they're just copying other companies. Bah. Bad layoff humor attempt. Sorry.
• i'm on my cellphone, so I'll find the link later. But Arthur Laffer said, "The age of prosperity is over." The supply-side guru believes that it is the government intervention that is driving the stock market down. (I think from WSJ)
• The latest election poll gives Obama an 8-point lead over McCain. Meaning, of course, that if McCain scores a touchdown, he'll have to convert the two-point conversion to force the game into overtime.

Forgetting the Bull Market

• Yeah. Kristen Bell from Forgetting Sarah Marshall and also Veronica Mars. Why not?
• Is it just me or does the market seem flat today? Is it turned on? Somebody plug it in!
• Seems like a long time since a bull market. As they like to say, the market hasn't gone anywhere the past 10 years!
• Not liking the tone of the campaigns the past week. I don't think it helps to be calling the Obama side Marxist. Now, I don't want my taxes raised, either. But have some respect for the guy and other opinions.
• And lets also hope that after the election, we still have checks and balances. Divided government is the best kind. Look what we got in 93-94 and 2001-2006. It's better if one side is there to stalemate the other.

New Highs Around the Corner?

• CBS loves those Miami Dolphins cheerleaders. Seems like every break the cameras go to the sidelines.  No complaints.
• I was listening to Rob Black's friday podcast.  He mentioned that from the bottom of the bear market to new market highs takes an average of two years.  A rather optimistic message here in the Big Bad Bear Market.
• Who knows where the bottom is, but we're closer to it now than we were at SP500 1500...  LOL.
• I love DirecTV's Red Zone channel.  "Set down the remote, and we'll change the channels for you."  I have the Red Zone channel on one TV, and the Bills-Dolphins on another.
• So, Sarah Palin spent $150,000 on clothes, but has returned most of them.  I get it.  Buy it.  Wear it once.  Return it.  Now THAT'S Main Street USA.
• Consensus says a .5% rate cut coming.

AC/DC Black Ice for Breakfast

I bought the new AC/DC Black Ice CD at $WMT yesterday. Have I listened to it? No. Why? Because my car CD player doesn't work. I don't have a CD player in the house. I just ripped it from the CD to my computer.

Yes, I could've listened to it over my tinny computer speakers. But I'm not going to do that to AC/DC. They're about hard hooks and percussion. I'm transferring the songs to the cellphone, and will listen... Now!

AC/DC Black Ice and a bowl of Cheerios to start my Sunday... Sweet.

Review of AC/DC Black Ice.

Sunday Randomosity (with Mila Kunis)

Why Mila Kunis? Watched Forgetting Sarah Marshall this weekend.  I liked it.  Pretty silly.  When a joke didn't work, you just waited for the next one.  Also watched Speed Racer, which sucked.  Yeeeeeesh.

So what have we today?  Gloooooooom....

• Interesting table that shows the components of the stock market decline.  It compares the Great Depression, the dot-com bust, and today.  Good read.
• The next stimulus package?  Cheaper oil (and gas prices)!  From Calculated Risk.
• Greg Mankiw wonders, have we learned enough?  But have we learned what caused the Depression of the 1930s? Most important, have we learned enough to avoid doing the same thing again?  Not if Obama is planning on raising taxes and shutting down free trade.
• The woman who called Wall Street's melt down.  Star bank analyst Meredith Whitney says the economy is about to sink into a deep recession.
• I was thinking about government tax revenues for the next couple of years.   In addition to stock prices collapsing, real estate prices have collapsed.  Where will the tax revenues come from to pay the ever expanding list of social programs?
• Remember the rumors of a Steve Jobs heart attack?  They caught the guy.  An 18-year old!
• Spending stalls and businesss slash jobs.  Layoffs have arrived in force, like a wrenching second act in the unfolding crisis. In just the last two weeks, the list of companies announcing their intention to cut workers has read like a Who’s Who of corporate America.

The Value of the Long View

Vanguard's John Bogle (not pictured) on the Long View.

Mr. Bogle, 79, has been warning for years about the excesses of Wall Street, where, he says, the triumph of “salesmanship” over financial “stewardship” produced colossal losses for millions of people. He is armed with statistics showing that a vast majority of investors — including most professional investment managers — should not even bother trying to pick individual stocks. They are just not very good at it, he says. Better to invest in the broad market through index funds with low costs, allowing the shareholders, and not the investment managers, to profit when times are good.

As for trying to time the ups and downs of the market, Mr. Bogle contends that the chances of being right over any extended period are so negligible that it’s a fool’s errand to try.

Yet for simple, straightforward reasons, he says that this is a very good time to put money into stocks — not for short-term trades, mind you, but as part of a diversified portfolio that you hold for many years.

Common sense.  We heard Warren Buffett comment in previous weeks that he doesn't know where the bottom of the bear market is, but that he was buying stocks because he felt they were of value and over the long term would appreciate.  Now John Bogle chimes in that it is a good time to buy equities.

Friday Night Thoughts

Remember back in 1999, when people wanted 24-hour, 7-day a week trading? Stock trading was fun back then!  And who didn't like Carrie-Anne Moss as Trinity in the first Matrix movie?

Planning for Next

• With a new President coming in January, check out how both sides are preparing.  It is widely reported that former Clinton Chief of Staff John Podesta is working with Obama, while former Reagan Navy Secretary John Lehman Jr. is guiding McCain's team.
• Insurance companies want some of the bailout pie, too.  Shares of these insurance companies (MetLife and Aflac) surged after the Washington Post and the Wall Street Journal both reported that the Treasury Department was considering extending funds from the $700 billion bank bailout, or Troubled Asset Relief Program (TARP), to the battered insurance group.
• Throwing the bathroom sink at the economy.  (Isn't it "kitchen" sink?)  Will interest rates go to 0%?

Is the Bathroom Sink Half Full?

• Investors terrified, but also optimistic.  Dan Silverman, a management consultant based in Washington, D.C., said that people are "terrified" about losing their money, but he's optimistic that investors will "calm down" after the presidential election is resolved in November. He said he's continuing to invest in his 401K because he's "buying at bargain rates," on the assumption that the markets will recover.
• You know, I remain invested and riding this thing down.  I remember the big panic in 1998 and went down with that one.  I was only partially allocated to equities for most of the 2000-2 bear market, but what I owned took a beating.  Looking back, it was that steady addition to savings every month that ended up producing great returns.
• Those returns have since been whack-a-moled.  But I digress.  I think it's the way to go.  Stay the course, as former President George HW Bush used to say before he lost the election for his second term.  Bah.

House Democrats contemplate abolishing 401(k) tax breaks

House Democrats contemplate abolishing 401(k) tax breaks.

Powerful House Democrats are eyeing proposals to overhaul the nation's $3 trillion 401(k) system, including the elimination of most of the $80 billion in annual tax breaks that 401(k) investors receive.

House Education and Labor Committee Chairman George Miller, D-Calif., and Rep. Jim McDermott, D-Wash., chairman of the House Ways and Means Committee's Subcommittee on Income Security and Family Support, are looking at redirecting those tax breaks to a new system of guaranteed retirement accounts to which all workers would be obliged to contribute.

Under Ms. Ghilarducci's plan, all workers would receive a $600 annual inflation-adjusted subsidy from the U.S. government but would be required to invest 5% of their pay into a guaranteed retirement account administered by the Social Security Administration. The money in turn would be invested in special government bonds that would pay 3% a year, adjusted for inflation.

The current system of providing tax breaks on 401(k) contributions and earnings would be eliminated.

Holy crap.

"The nine most terrifying words in the English language are: 'I'm from the government and I'm here to help.'" - Ronald Reagan.

Financial Panic Apocalypse

Enough of the Apocalypse Already!

And the land was overrun by prophets of doom, and with them came four horses, and on those horses were four riders, and the names of those riders were Fear and Anger and Gloom and Panic.

And these gloomy, mostly pudgy and balding prophets shouted from the rooftops, predicting the end of happiness, the end of the dollar, the onset of starvation, the collapse of markets globally, and the hegemony of China. And those who prophesied the worst got the most airtime.

And darkness reigned upon the waters, and a cloud of verbose unknowing spread across the globe.

...

Above link for more!

Friday Lock-limit Lunch Time

The market was lock-limit down early this morning, prompting Katie Holmes to say, "Everything in my life is sooooooo crazy!"

It Could be Worse

• Lock-limit down this morning and now we're only down just over 4%!  That's a rally these days!  Wooooot!
• Er... 5% now (updated).
• Bad news?  Chrysler to cut 1 out of every 4 jobs.  Good news?  3 out of every 4 jobs are safe!  For now...  The cuts, about 5,000 workers in total, will come from Chrysler's salaried and supplemental workforce. Chrysler has about 18,500 white-collar workers.  Salaried workers, which will will make up a majority of the job cuts, will be offered buyouts and early retirement packages, said Chrysler spokesman David Elshoff.
• Will the Fed go below 1%?  The Federal Reserve is widely expected to cut interest rates again next week. But could the Fed soon go where it has never gone before and bring them below 1%?  Not a lot of wiggle room after that.
• Gas prices below $3... and falling.  The national average price for a gallon of regular gas fell to $2.781 a gallon, down 4.1 cents from the day before, according to AAA's Daily Fuel Gauge Report. That's the 37th straight day that prices have dropped.  Now THAT'S a win-streak for Main Street USA!

Home-Stretch "Strategeries"

• John McCain to use divided-government argument in last week.  Because, gosh-darn it, it's worked so great the past 2 years!
• Colin Powell on Meet the Press one year from now.  lol
• Thousand line-up in Missouri to see Sarah Palin.   (Live video feed NOW!)  The Alaska governor is scheduled to begin her speech at noon Friday at a rally in the parking lot of Bass Pro Outdoor World. Some spectators braved a stiff wind and chilly air to arrive by 3:30 a.m., long before gates opened at 9 a.m.

 

No Can Sleep Randomosity

It's in the Wall Street Journal... Lucy Liu plays Nola Lyan,not Nolan Ryan, in Dirty Sexy Money.  The WSJ has all the important stories.  Agreed?

Thank F@#king Goodness

• ... that we're not in a recession, Howard Lindzon.  While CNBC spends 24 hours debating whether we are entering a recession, the world has imploded.
• ... gas prices are under $3.
• ... it's Friday!

Emperor Steve Jobs

• Congress Considers iPhone.   The iPhone may soon be a new option for congressional members by the next Congress in January 2009. After "a lot of people" made the request for an iPhone, the Chief Administrative Office (CAO) that oversees the House's communications technologies has begun a small test to see whether the device is a viable option for Congress.
• While you and I can buy iPhones for $199 or $299, I wonder how much Congress, the home of the $600 hammer, will pay for them?
• Turn your blog into an iPhone app.  At least  your blog's RSS feeds.  You're just one click away from Adam Warner.

Hallelujah

• Nuclear power revival gets big lift.  Build 'em, dammit Gumby.
• And get this, Solar Power is not just for electricity.  The Sun can also be used to warm the Earth.  Who knew? 
• Okay, actually the article says Solar Power can generate steam at the new plant near Bakersfield, CA.  In case you need your shirts pressed before you head up the Grapevine towards Los Angeles.
• The solar plant will provide electricity for 3500 homes in Central California.  I wonder how much it costs...  Besides lots of acreage.

Late Night Randomosity

The big news? Anne Hathaway's boyfriend (not pictured) gets nearly 5-year jail sentence.

Future Tense

• Notice a theme? Companies reporting that current earnings are fine, but they're worried about the future.  Wall of worry?
• Microsoft beats the street, but cuts outlook.  The software giant reports profit and sales that were bigger than what analysts expected, but lowers its guidance in anticipation of a slower economy.

Can I get a Do-over?

• Alan Greenspan softened his longstanding opposition to many forms of financial market regulation, acknowledging in an exchange with Waxman that he was "partially" wrong in his belief that some trading instruments, specifically credit default swaps, did not need oversight.

Political Shockers

• New York Times endorses Barack Obama.  I about fell out of my chair on that one.  I had them going for McCain this year.  Or maybe a Bush Third Term.
• Maybe the NY Times will endorse Sarah Palin in 2012.  Is Palin making plans for 2012?  I ask because she's contradicted John McCain on a number of subjects in recent weeks--and every contradiction seems calibrated to preserve (or even enhance) her standing with the Republican base should the Arizona senator lose on Nov. 4.

Buy Signal: It's Dead, Jim

Just last week, I mentioned the follow-through day buy signal. It died yesterday with the new lows set in the market. Whipsaw for those chasing that one.

In addition, last week Gary Kaltbaum indicated on his radio show that he had taken a position in the market. Later he revealed that it was just a 10% position in a market index. He closed that position yesterday.

I remain long and riding down the bear market. Woot. I don't think now is the time to initiate sales. But it sure feels dire.

Market at 5-yr Lows

Sure, the stock market tanked. But the big shocker is Toni Braxton being booted off Dancing with the Stars.  Huh?

Would you like your Market Toasted?

• Deep recession fears get the blame for today's big sell-off.  Stocks tumbled to 5 year lows on Wednesday as investors grappled with an increasingly dire outlook for the global economy following a raft of disappointing profits and outlooks from major U.S. companies.  It is the "outlooks" going forward that Wall Street is worried about.  But at least we'll all have iPhones, as AAPL bucks the trend and closed higher.
• IBD out with an article praising Amazon's Kindle book reader.  $359, folks.  Sure, it looks nice.  But $359.  C'mon.  There is a free ebook reader for the iPhone called Stanza.  So you know, cookie.  And that's what I'm going to get when I buy my iPhone in a few weeks!
• Uh oh, speaking of AMZN... Afterhours, AMZN reported 48% bump in revenues but revised their outlook downward.  Try lowering the price of the Kindle, fellas.  $359? 
• Wal-Mart to toughen standards.  Huh?  WMT plans to announce Wednesday in Beijing that it will require manufacturers supplying goods for its stores to adhere to stricter ethical and environmental standards.

The Political Football

• From Nobel prize winner Paul Krugman, is the economic collapse a conspiracy?  I think it's a fair shot from PK.  The extremes on both sides are a little wrapped up in conspiracy theories.  You know what?  I say Paul Krugman should go on Dancing with the Stars and try to win the dance globe prize next.
• From a 9% Obama lead in Fox's poll today to a statistical dead heat in the AP poll.  And you thought the stock market was volatile!
• The "World" picks Obama 4-1.  I think ACORN already registered the World with a home address in a shack in Ohio.
• What's up with the polls?  From Cristy Li.  (I liked the cartoon!)

Nancy Pelosi's Stimulus Package

I just clipmarked an op-ed from Investors Business Daily about Nancy Pelosi's ideas for the next stimulus package. (Check out the picture source. I don't believe it, but, "Hello, Mrs. Speaker.").

"Included in that giveaway: $37 billion in public works spending on infrastructure (think pork and a lot of it), $15 billion in aid for states to pay their Medicaid bills, $6 billion to extend unemployment benefits and $3 billion for additional food stamps."

I think we need something other than a check in the mail. But I'm not sure if food stamps and unemployment benefits will do the trick. IBD op-ed page is very conservative, but this one I totally agree with. IBD calls for opening up ANWR and offshore for oil drilling, and building nuclear power and other energy infrastructure.

Energy is off the front page headlines now with the stock market gyrations and election gaffes getting the big bold print. But somewhere down the road, the world economies will get better and energy demand will go back up. And so will prices. The concerns that we had about energy prices just a few months will again be in the headlines. How many times have we heard, "It will take 10 years to bring that energy to market." Or,"Well, if we started 10 years ago, we'd have the energy now."

I agree that we need to open ANWR (and elsewhere) for oil drilling. I also think we need to get moving on more nuclear power. Electric cars are coming, and we'll need a lot more electricity to charge batteries. Our current energy grid won't do it. And all this hope and euphoria over wind and solar isn't scientifically well-founded. We should definitely do it, but it's not very reliable, the costs are pretty high, and solar panels and windmills cover a lot of real estate to generate power.

Will we be better prepared 10 years from now?

Tuesday Randomosity

I don't know about you, but I always need a day off to recover from my day off.

An Apple a Day

• Apple (AAPL) rocked earnings, as everyone is buying an iPhone.  Including me in a few weeks!  I think now that they've opened up the applications to outsiders, the phone is a great and easy tool.  The iPhone is nearly 40% of AAPL's business!
• There are some interesting competing phones that run Windows Mobile.  But Windows is just so click intensive.  While in Las Vegas, I'm trying to find some NFL box scores to check on how my fantasy football players are doing.  You can run down a battery pretty quickly doing that. 
• AAPL also is selling the iPhone for $199 with a contract.  Much better than the previous version of the phone which required no contract but had a hefty buy-in price.  Those fancy Windows Mobile phones can run a lot more.  Although, the iPhone is putting pressure on those prices.
• I think this is going to eventually hurt Blackberry (RIMM).

Vote Early, Vote Often

• I missed the Joe Biden gaffe. 
• I think the election is already decided.  Polls are showing Obama up in Red States.
• The Democrats also have a chance to control 60 seats in the Senate, which would eliminate the filibuster for the Republicans and basically move them aside during Obama's registration.  The Democrats would have the ability to do whatever they want without input or opposition from the Republicans.
• Unless the GOP can convince a Senator to switch sides, go Independent, or vote with the GOP.  Maybe Joe Lieberman will decide to caucus with the Republicans.  I was reading on Wikipedia that he's officially Independent, but was caucusing with the Democrats.   Because he endorsed McCain, he no longer attends the Democratic Senate leadership strategy meetings or policy lunches.
• Anyways, I'm ignoring the tax cut nonsense coming from Obama.  I can't imagine a tax cut happening with Obama, Reid and Pelosi calling the shots.   I expect the opposite:  A middle-class tax hike.  Not a cut, a hike.  And of course, higher taxes on the rich.
• I also think they'll take a stab at nationalizing health care.  You'll hear it first here:  The costs will be exponential from whatever estimates they make.

What Happens in Vegas...

• Gambling damage wasn't too bad.  I can't believe how crowded the casinos were.  Las Vegas was jam-packed.  What economic slowdown?
• I like to play 4-team teaser parlays in the sports book. 
• So the show I saw was Criss Angel Believe at the Luxor.  It was okay.  Least favorite of the Las Vegas' Cirque du Soleil for me.  It wasn't bad, don't get me wrong.  I liked the music.
• I haven't seen the Zumanity Cirque du Soleil, but if I had to rank the others in Vegas that I have seen I'd go:

1. O
2. Mystere
3. Ka (loved that rotating platform!)
4. Love
5. Criss Angel Believe

Back from Sin City

Back from Las Vegas. You'd never know the country is in an economic slowdown in Sin City. Very crowded. Lots going on. Went and saw the Criss Angel Cirque show. Eh.

Buy Signals: IBD, Gary Kaltbaum, Warren Buffett

• Yesterday was a follow-through day on the DOW and Nasdaq. Saddle up!
• Gary Kaltbaum gives a buy signal.  "I bought into the market today for the first time in eons," Gary Kaltbaum of Kaltbaum & Associates, who had been in all cash, wrote in a note to clients.
• Kaltbaum's radio show for 10/16.  Thinks it's just a bear market rally, maybe lasting up to 8 weeks.  Sentiment is the worst he's ever seen, gloom and doom, nothing but bad news in the headlines, follow-through day on the DOW and Nasdaq, etc.  Listen to the first 10 minutes for his reasons.  Later in the show he says that he thinks it's probably just a bear market rally.
• Warren Buffett:  I'm buying stocks.  "A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful," said Buffett. "And most certainly, fear is now widespread, gripping even seasoned investors."

Just Another Wild Swing

• I'm amazed at the market volatility with each passing minute.  Go to the bathroom, come back, and there's 300 point swing.  At least.  If you want to play along at home, you might as well move your trading office into the bathroom.  Or put plumbing in your trading office.  Can't afford to miss a tick.
• "Is that a new porcelain office chair, Muck?"
• As I mentioned, it seems rather easy to play.  Down big?  Go long.  Get out after the mega-bounce.  And vice-versa if up big.  Buy an inverse fund, and cash out after the mega-fade.
• Lather.  Rinse.  Repeat.  Get rich.
• I'll link to Adam Warner on this one about Fox going with negative ads on Jim Cramer.  I think Cramer is just entertainment, but pity the person trying to "play along at home."  Adam gives the h/t to Michael Parekh; so, I will, too.
• I didn't watch the debate last night, but feel that I've seen enough clips and commentary to understand what went on.  McCain probably seemed a bit old and angry.  "My friends..." Obama probably dodged all the questions and was very non-specific with his answers.  "Er, uh, look.."  The usual.  Right?
• Who is Joe the Plumber?
• A lot on energy the last few debates.  Nuclear is really the answer, but it's not the politically correct answer.
• Why wind power won't work.
• BYU - TCU tonight!  Set the DVR!

 

The Market Totally Sucks Randomosity

Yeesh. Lets go to Yahoo Finance.

The stock market plunged the most since the crash of 1987 as disappointing retail sales data and credit concernsrenewed economic fears. Specifically, the S&P 500 plunged 9.0%, settling near session lows.

Consumers continue to curtail spending in the face of economic headwinds. Retail sales in September tumbled 1.2% month-over-month, the third consecutive monthly drop and largest decline in three years. The decrease was larger than the expected drop of 0.7%. Sales are down 1.0% compared to last year, marking the first year-over-year decline since October 2002.

• "Specifically."  LMAO.  Yeah.  Well.  Yeesh.
• Hey, I'm using Clipmarks and Twitter more these days.  You can follow via the links on the sidebar there.  To your right.  See 'em?  Yeah, those!
• Well, since I did some tax loss rotations  a couple of weeks ago, I've built up some more tax losses.  LOL.  I also have a few winners in the mix, though.  Bought some of the banks before the announcement that the government was going to buy shares.  That helped.
• I'm looking for "bargains" that I believe will be up a few years down the road, and also "bargains" in that mix that pay hefty dividend yields.  But don't want to go crazy there because dividends can be cut in this type of environment.
• Smoking.  Drinking.  The vices of life.  Maybe those are somewhat recession proof.  Heck, I feel like getting drunk now myself.
• Speaking of drunk, anyone watch The Cleaner season finale last night?  I kind of like it.  But I'm Grace Park biased I think.  "Akani, put some pants on."  Anyways, the finale story featured some drinkers.  Probably down 40%+ in the markets and turning to the bottle.

Inflation: Point - Counterpoint

Inflation?

• Gold rises on inflation concerns.  "An extraordinary amount of liquidity has been pumped into the system this year," said Peter Grant, senior analyst at USAGOLD. "I anticipate further debasement of all currencies, including the dollar, which will ultimately drive gold prices higher."
• Inflation measures fall.  The Labor Department reported that U.S. wholesale prices dropped 0.4 percent in September, in line with expectations as another fall in energy costs eased price pressures.

Er...  Well, in the latter report, it does mention that despite the drop in oil prices, ex-food and energy, inflation was higher.  It's funny how when oil prices were surging, the news ignored the ex-food and energy number.  Now that oil prices are falling, the news is focusing on the ex-food and energy number.

It seems like the news wants to report that we have runaway inflation no matter what the numbers are.  Additionally, if you parse the numbers you can always find something in there that supports whatever view you want to have.

Dancing with the Volatility

• Why not Brooke Burke?  She's doing great on Dancing with the Stars.
• Well, anyone trading the volatility here?  Whenever something moves 300 points in one direction early, it seems to reverse itself dramatically more often than not during the course of the day.
• I remain long this market.   I think selling here would just be a panic move.  As I heard someone said on the news, "We're closer to the bottom now than we were a few weeks ago."
• Duh!  Yeah, really ya think?
• I think the likelihood is that we have some sort of rally here in the bear market, and then retest the previous market lows.  I'm probably not the only one thinking that.
• Who is going to even bother to watch the debate tomorrow night, my friends?  Obama is running away with this thing.  The country just wants a change.  I think if the market was at 14,000 and we were dealing with $5 gasoline, McCain would have a shot.  But everyone has forgotten about energy at this point.  Don't worry, oil prices will go up as the world's economies improve and demand increases.  No new supply is being brought onto the market, so we know how it will go.
• I think I am going to get the iPhone.  Can't upgrade until next month.  My battery life on my current phone is about 10 minutes.  LOL.

Tuesday Morning Thoughts

• After yesterday's 11%-plus gain in the market, today started off with another ramp to the upside. But that action quickly faded.   After some incredible percentage moves the past few weeks, to see the market within a percent or two of its open is a bit boring!
• For the reason du jour, there are fears of earnings reports and also some profit taking setting in.  I was listening to Gary Kaltbaum's radio show (Investor's Edge) yesterday, and he congratulated the longs still in the market who made back a lot of their losses on yesterday's move.
• Jason wonders if we'll see a 35-40% move in the NDX from bottom to top in this rally.
• Simon Cowell makes $36 million per year on American Idol.  Paula Abdul makes $5-8 million.
• A lot of fuss over Cheryl Burke's 5 lb. weight gain.  I mean, c'mon.

Happy Columbus Day!

Another Columbus (not pictured) day!

The stock market up nice today. But we've seen extreme volatility and huge percentage swings during the trading day. Stay tuned! I remain long and down significantly from the bull market highs. I'm not sure if I'm outperforming the market or not. I've rotated around here and there, and hopefully adding some value to the portfolio. We shall see.

Up 510 on the DOW. Hey, we were due for at least a bounce anyways. During the 2000-2 bear market, we had a couple of nice bear market rallies.

I started fantasy football at 0-3 in both of my leagues. In the one where I lost Tom Brady, I've now won three in a row. Thanks to Matt Schaub in two of those weeks. He has been a capable backup QB for me. In my second league, I'm now 2-4; thanks to the re-emergence of Ronnie Brown.

Don't Watch the DOW

Good column on "the crisis of credit" that is hitting world markets.

Also see some of the clipmarks in the sidebar.

clipped from tbm.thebigmoney.com attending to the ups and downs in the Dow won't tell you much about the current financial crisis. Ours is a crisis of credit: Financial firms are unwilling to lend to each other (at all-but-exorbitant rates) for fear that borrowing firms may fail or that they themselves may need the cash to fend off their own crisis. the TED Spread measures credit conditions directly. Bloomberg tracks the TED Spread here. What sounds like second-rate Nutella is actually the difference between the interest rate banks charge each other on three-month loans and the interest rate on three-month U.S. Treasury bills.

Randomosity de Sabado

• So, I'm home.  Have Bob Brinker's radio show on.  He's not talking much about the stock market, per se.
• Iceland goes bankrupt.  The country cannot pay back its external debts, and the Icelandic currency, the krona, has become essentially valueless in the rest of the world. That means the country can no longer pay for imports.
• Here I sit in CA, where Governor Arnold says the state doesn't have money to pay its bills and needs a $7B loan from the Feds.  Tax revenues will be down here, as we rely on the rich to pay the bulk of the taxes.  No gains from stocks this year, and taxes from real estate will be down as property sales slow and values plummet.
• Michelle Malkin has a blog entry up asking for feedback on what you're doing now, buy, sell, hold, panic...  Just holding on and continuing to dollar cost average in.   I certainly missed this bear market and have ridden it down.  I've also done some tax loss selling and rotated into like-kind things.  Will need the tax write offs once Obama gets in there and raises taxes on the middle class!
• Largest Bond ETF now trading at a discount.  The world's largest bond ETF, and one of the largest ETFs overall, iShares Lehman Aggregate Bond Fund (AGG), is trading at a 8.9% discount.
• John C Lee at the Trading Goddess website with the greatest market crashes in history.  Worth a look for the pictures.   Winks.
• Sentiment survey roundup from Trader's Narrative.  Nice.  Of course, despite the overwhelming bearishness out there, the first line on Barron's cover this weekend asks if this is the bottom...

The Secular Bear Market, January 2000 - ????

Just a picture of the SP500.

Are we in a trading range defined by the January 2000 highs and the October 2007 highs as the top, and the bottom being September 2002 and October 2008?

Crazy Ass Market Randomosity

• Well...  The market all over the place!  You go to the bathroom, and there's a 400 point swing in the DOW by the time you zip it up.  And you were here to SEE IT! 
• The 2002 Market Bottom Analogy.  Interesting.  As interesting as the bottom of a Jacksonville Jaguars cheerleader?  You be the judge!
• Greg Mankiw has thoughts on How to Recapitalize the Financial System. 
• Loss of wealth to weigh in on consumer spending.  I mentioned in the last entry that I was shopping at ATT for an iPhone.  I had to wait in a line.  I know folks are cutting back somewhere. Maybe dining out and such.  But they want their technology, and things haven't gotten that bad yet.
• Yes, the banks are rallying from the WSJ blog.  Disclosure:  I bought some WFC (Wells Fargo) yesterday at the close.  Not bottom fishing, because that's impossible in this market.  Just consider WFC one of the better ones out there with somewhat less exposure to the subprime mess and with the power to go out there and grow and acquire.  *I think.*  And *I hope.*
• I heard on the local news this week that drinking, gambling, and smoking were up.  Sin stocks for tough times.  I thought about looking into some of the smoking stocks, but haven't yet.
• You know where there are a lot of smokers?  Smoking areas outside businesses.   Bah.
• Hey, what about the bear market in oil prices?  Back to where they were a year ago.   Just a few months ago, oil was $147.  Now?  $79 last I looked.  How's XOM doing?  How's Hugo Chavez and the Royal Family doing?
• From Tenille Tracy, Rising Option Prices Could be Propelling Stock Swings.

The options market has become an expensive place to do business in recent days, and that could be contributing to wild swings in the stock market.

The options market often serves as a buffer to the stock market, providing a venue for investors to protect their stock portfolios or speculate on future moves without actually buying or selling stock.

In recent days, however, the prices of options have skyrocketed — in part because volatility in the market has flown off the charts. Options that once traded for a few dimes now cost more than a dollar, or even several dollars. And that’s especially true for put options, which are bearish contracts that convey the right to sell a company’s stock at a fixed price.

As a result, investors who would normally buy puts to protect their stock holdings might be opting to sell their shares altogether. It’s almost as if they realized their monthly car-insurance policy went from $100 to $1,000, and they decided to simply sell the car as a result, says Randy Frederick, director of derivatives with Charles Schwab & Co.

End of a Brutal Week

• The market...  We need some spirit.  Bring on the cheerleaders!
• Well, it's just a huge crash.  I missed it.  Riding it down.  Not even looking at technical indicators.  Sure, everything is at extremes - see the charts below!  And normally, I'd be looking for options expiration week strength next week after this cascade down this week.  But this isn't normal.  Historical trends and technical analysis doesn't matter here.  Everyone is streaming for the exits.
• Yes, that should present a bottom at some point, maybe a rally, and a retest of the bottom that would conform from a more textbook technical analysis point of view.  Not yet, though.
• President Bush says he has tools to solve the market crisis.  Er, right.  And you're just keeping them in the toolbox, Mr. President?
• The reality is that the tools have been unleashed with liquidity.  Lower rates.  Huge bailouts.  Eventually, that will matter.
• With the stock market crash, there is no chance for John McCain.  Hey, maybe George Soros is behind this market crash!  If you missed the George Soros (plus Bush, Pelosi, and Reid) Saturday Night Live sketch, it was taken down from the NBC website. 
• Will Microsoft buy RIM?
• I think I'm going to get an iPhone, FWIW.

Nasdaq 100 Bullish Percent Index

2? LMAO.

(Chart from Stockcharts).

NASD % Above 50MA - Weekly

Sweet.

(Chart from Stockcharts).

Karma 101

I had my interview back at the Salt Mine this morning.  I didn't let anyone know about it, and used the old  excuse, "I have a dentist appointment.  I'll be in around 10am."

At lunchtime, I was eating my sandwich.  Bit into an olive pit and chipped a tooth.

Ended up at the dentist and with a new filling.

Random events?  Bad karma?  George Bush's "tax cuts for the rich" fault?  Will President Obama promise to regulate the sandwich industry within the first two years of his first term?

SP500 Below 1000

• Interview at my previous employer, the Salt Mine, tomorrow. I've been away from there over four years now.  Time flies.  I went back and found the previous blog entry where the Salt Mine had made me an offer to come back.  That was two years ago!  Not too anxious about the interview.  
• The more the government intervenes in Wall Street, the worse it seems to get.  Another big meltdown today.  The SP500 is now under 1000.  Boy, for those who had their money on "secular bear market" in 2000, looks like you nailed it.  Will the SP500 retest 800?  Closing in...  Maybe in a couple of days at this rate.
• Good news?  It can't go below 0. 
• No reason to even talk about technical indicators.  Worthless right now as we're entirely watching the news for what the government is doing next.
• Sentiment is horrible.  Everyone here at the Fun Factory is watching their portfolios melt down. 
• How the government forced us into the subprime mess.  This whole mess was another Big Government program .... It started with great intentions but resulted in typically awful unintended consequences that materially hurt the very people they were supposed to help.
• And folks want the government to take over health care?  Subprime health care for everyone?

There's Always a Bull Market Somewhere... Or is There?

Pretty close to 0% trading over their 50dma.

(Chart from Stockcharts).

Bailout Friday

• I guess the market doesn't like the bailout package. The Senate passed it Monday, the House passed the package today, and then President Bush signed it.  Whoosh down goes the market.
• For those looking for a confirmation day after Monday's rally, yesterday the Nasdaq and NDX made new lows.  Today, the DOW and SP500.  I guess the only confirmation day we'll be seeing now is from the Catholics.
• And now, California's Governor Arnold Schwarzenegger is looking for a $7B Treasury bailout for the cash-strapped state.  "Nancy and Harry, can you make that a $707 billion bailout package?"
• I know a lot of folks don't like the partisan political stuff, but Michelle Malkin has had some good stuff up on the bailout bill.  After the vote, she has up "Now they'll tell us it's not enough."  Yeah, with links.
• Steve Jobs being okay after the nasty rumor of heart attack.  AAPL is under $100 now anyways.  And it's not that there aren't 3-hr. lines to buy iPhones.  It's just PE multiples being compressed.
• Me? I'd rather get the Sony Xperia X1.  Or the HTC Touch HD.

The Bailout of Ninja Loans

I'm following Michelle Malkin's "live blogging" of the debate on the House floor over the financial bailout package. She's against it.  I'm not sure where I stand.

On one hand, I don't want to see banks close and the impact of that on the economy.  On the otherhand, there is something to be said about letting what doesn't work fail.  The government pushed the "ninja loans" (no income, no job, no assets - no problem!) on banks in the first place, and encouraged Americans to buy homes.  Many of whom should've never bought homes.

So if these loans fail and the banks who made the loans end up taking huge losses or failing, lesson learned, right?  Yes, painful.  But maybe that's just how free markets work.  And injecting these ninja loans into the free market was a bad idea.  But nobody cared a few years ago, as too much money was being hustled on these things.

I just don't know.  It looks as if this is going to pass the House.  And I'd imagine President Bush will sign it.

Thoughts?

Senate Passes Bailout Bill

Well, the votes have been cast and Kim Kardashian has been voted off Dancing with the Stars. Oh, and the Senate passed the financial bailout thingy.

The curious thing is the stuff loaded on to the bill, like tucked away in the tax provisions is a landmark health care provision demanding that insurance companies provide coverage for mental health treatment—such as hospitalization—on parity with physical illnesses.

What the heck does that have to do with bailing out bad mortgages?