Thursday, May 31, 2012

Mortgage Rates at Record Lows

The 15-yr mortgage rate is at 2.97 and 30-yr at 3.75%. $$ 


We're at the point where everyone has been saying interest rates can't fall any further - but, they do.  The obvious statement is that it's a great time to buy a house.  Yet, housing prices continue to fall with no bottom in sight.  Housing prices depend on wage inflation, and it's been a rough stretch the past few years.


Mortgage rate falls to record 3.75 percent 
BUSINESS | MAY 31, 2012
Average U.S. rates on 30-year and 15-year fixed mortgages dropped to record lows again this week, with the 15-year loan dipping below 3 percent for th... Read more

Sent via Pulse/

#172: Market Thoughts, Nokia, Research in Motion, News of the Day

Wednesday, May 30, 2012

Stock Sellin' Wednesday Randomosity

  • Wow. Yesterday's stock market rally was sold off all day today. $$
  • Why? Europe. It's always Europe. Stop asking. It's either Spain or Greece, but others will probably get hit. Basically, they're going broke but still trying to borrow money because politicians believe that borrowing money solves budget problems.
  • So Facebook is or was thinking about a smart phone. That makes absolutely no sense. And did you read that they're interested in the Opera browser? Still makes no sense.
  • Mass porn shoot at the LA coliseum. LA is always the trend setter, so look for the "in crowd" in your city to start this in your local coliseums.
  • Mitt Romney wins the GOP nomination, but I think that's as far as he goes. I think the country has drifted to the left, and so many folks don't pay taxes but receive benefits. Cutting taxes at this point benefits "the rich" because they're the only ones left who pay taxes. But when taxes are increased on the rich, it just ends up impacting the middle class and poor via higher unemployment and higher costs of goods and services. *steps off soapbox*
  • Speaking of, California may pass a law that lets private sector workers participate in a state run pension. As if CalPERS, CalSTRS, and every other public pension isn't underfunded as it is. Oh, and what about Social Security being underfunded, too? You really want these guys running your pension? Smells a little like a wealth redistribution scheme to me. *really steps off soapbox*
  • So I remain mostly in cash with some low beta stuff. Haven't been trading at all. Kind of watching the Spring-Summer go buy. I may play at moving averages or retests for a rally. Maybe.
  • LA Kings win game 1 in hockey.

Tuesday, May 29, 2012

Tuesday Thoughts

Even with the headlines obsessed with $FB and $RIMM, Spain and Greece, the market had a nice rally today. It started up, tried to fade, but then turned back around and finished strong. This wasn't even one of those days where we start out way down and come back. This was pretty much a solid day all around. 

Well, except for all the Web 2.0 social stocks. And Research in Motion - or Research in a Complete Freefall.


I still think the market is in the summer correction mode, but that probably means a trading range. So we have headed up from now. And at first glance we look at just below SP500 1300 as the bottom of the range for now, and we shall see where the top of the range will be. Somewhere near but maybe a few percent off the 2012 highs?




In Dodger Town, a frustrating 2-1 loss... YIKES.

Monday, May 28, 2012

Facebook IPO: Wall Street's losses mount - May. 25, 2012

Much has been written about the losses from the $FB IPO. Here is a column that reviews some of the bigger losses.

The losses are in the millions.  And by that, I mean tens of millions.

Don't you think there will be books and movies about "Facebook Friday?"


Sent from Yahoo! Axis - An Awesome Search Browser

More on Spanish and Greek Debt

Talk about your bank runs: 

"Banks in troubled euro zone economies such as Greece and Spain appear to be seeing their deposits flee to German or Swiss banks, a move that could potentially trigger a fresh crisis if those vulnerable banks face liquidity shortages, Ii said."

Maybe a lot of this has been priced in.  After all, it's not like the "Euro crisis" is something new.  We all have known that there are problems in Europe, and every solution so far just kicks the can down the road.  As of now, not too many of the solutions have been a serious attempt to solve the problems of not enough money to fund the government expenses.  The solutions all involve borrowing money or more debt.

Anyway. It is what it is.

Sent from Yahoo! Axis - An Awesome Search Browser

Does it Matter if the Spanish Markets Collapse?

A new week with the same news: More problems in the Euro Zone via Spain. Hey, what's wrong with solving a debt crisis with more debt? Well...

So the markets will have this sort of news to look forward to this week. I'm sure Greece, Italy, and France will add some spice to the Euro buffet this week, too. 

And the US GDP, too - right?

This Is The Report That Caused Spanish Markets To Collapse Today

Spanish markets got clubbed today, as PM Mariano Rajoy was announcing a new nationalization scheme for Bankia. But that was mostly expected. What fr... Read more

Sent via Pulse/

Friday, May 25, 2012

The EU is Full of It

The EU is full of it. They are basically paying off debt by issuing more debt. How many times have they tried this scheme before? Every time it was presented as "problem solved" but all they did is rack up more debt. And more and more countries are heading toward the same situation. 

But they are right in that the US isn't far from the same situation, too. 


Sent from Yahoo! Axis - An Awesome Search Browser

Thursday, May 24, 2012

Blame it on Euro

The stock market has had a few late session flurries this week that have turned things around from the brink. All eyes have been on Europe, as the region tries to deal with a troubled Greece economy. And yesterday, the Fed came out and said the helicopters were on the launch pad ready for the US money drop if needed, and that turned around the falling markets on a dime.

It's tough to be long or short.  The winds are blowing all over the place.

I haven't seen much good news out of Europe, but hope remains.  As I type, it seems as if the Euro talks are going nowhere.  The bottom line is that without some accountability and willingness to pay bills, Greece is in trouble because of huge entitlements and doesn't have the means to pay them.  Ah, socialism is great - it just sucks when you run out of other people's money.


Using the new Yahoo Axis browser, which sends email links that includes screen caps!  It's a pretty cool browser.


Sent from Yahoo! Axis - An Awesome Search Browser

Money Flees US Stocks!

Who can blame investors if they feel a bit frustrated in a secular bear market that started in 2000?  $$ 

It's been a dozen years!


Investors Bail on U.S. Stocks

For those still reeling from Fleecebook 2012, take heart: Feelings of abandonment are all the rage right now. Money was already fleeing U.S. equity f... Read more

Sent via Pulse/

Wednesday, May 23, 2012

HP in 2012

$HPQ announced earnings and that it would cut 27,000 jobs.  We knew it was coming, as the news was leaked last week.

It's kind of interesting that HP has been a company of PCs, laptops, printers, and at one time handheld devices.  Over the last decade, consumers have moved to tablets and the iPhone and Android phones have replaced handheld devices.  In addition, the printer business has slowed as folks now have lightweight ready devices to view documents without paper or expensive ink cartridges.

The stock was up afterhours, but they still have some challenges ahead...


HP to cut 27,000 jobs
CNN MONEY | MAY 23, 2012
Hewlett-Packard said it will cut 27,000 jobs across the globe to save on costs and reinvest in research in development... Read more

Sent via Pulse/

Tuesday, May 22, 2012

Tuesday Randomosity

  • The $FB stock slide continues as the stock hits $31. Now all the investigations are beginning, and the politicians are starting to get involved. Nothing good comes from that noise. So the NASDAQ, $JPM, $FB, and the folks involved will all be giving testimony and investigated. Blah blah blah. You know the drill. Forests will be leveled writing about it.
  • $DELL misses earnings estimates as earnings slump. Dude, everyone is buying tablets!
  • Market futures are down by the way. When was the last time futures were down at night? Seems like they've been up most every night and then the market sells off during the day.
  • So, the market was down about 50 and then ramped near the close to finish down 1. Who was buying, Morgan Stanley?
  • Donald Driver wins Dancing with the Stars. It was the country song last night. Nice call!
  • By the way, the primaries are still going on. Who knew? Romey won Kentucky and Arkansas.
  • Dodger Town: LA Dodgers win 6th straight. Doing it the hard way against Arizona tonight. Sheez.
  • I always cheer for Cheryl Burke in Dancing with the Stars. I think Donald Driver stole the show last night, but I was still pulling for Cheryl. I don't even care who she was dancing with. LOL. Maybe next year, Cheryl.
  • On a personal note, I have a new pool pump and the pool is ready for this weekend!
  • On to Wednesday...

Hedge Fund Manager on The Facebook IPO

Great column up on $FB. Must read for Facebook IPO followers.

Just an unbelievable chain of events that unfolded last Friday on what coulda-shoulda been a great day for FB.


We just got off the phone with a hedge fund manager who says his fund owns Facebook stock "in excess of a $100 million."

The fund bought the stock Friday, after the IPO.


Monday, May 21, 2012

Market Thoughts after the BIG Rally!

Here are my stock market thoughts after today's big rally. $$

  • We all know the market was oversold and due for a bounce. The RSI(2) on the NDX was .01 for goodness sakes!
  • The rally was strong today, but not on huge volume. One day wonder? Will the market resume the downward trend as folks take whatever profits they can get and sell?
  • Or, has the market put in a low for the summer's trading range? It could be that the downtrend is over, and that the market will spend the rest of the Spring and the bulk of Summer meandering back and forth between about 1300-1400 on the SP500, culminating in the Sept-Oct time frame with a double or triple-bottom.
  • By the way, that last one is my best guess.
  • Apple rallied about 6% today. By the way, check the track record of going long when the RSI(2) is under 1 on AAPL. Go ahead. I'll wait for you.
  • *tick tock* ... See?
  • Anyway, lots of currents in the news flow to toss us around. I don't think the correction is over, but maybe we'll meander up and sideways for awhile. There are still stories out of Europe and China that will freak out investors, as well as continuing Malaise here in the US economy.
  • Of course, the US elections will also get a ton of coverage. More than any of us can tolerate is also my guess. No matter who wins, I'd imagine gridlock will be the word of the day. Obama will have to contend with a likely GOP Congress, while a President Romney would have to face a filibuster in the Senate. Neither party seems really serious about reducing the national debt or deficit. So that will go on until we can't borrow any more.

Facebook or Faceplant?

Yikes! Shares of $FB face plant on 2nd day of trading. You knew the way Facebook was held at $38 on Friday that something bad was going to happen.  And on a day where the Nasdaq stocks were rippin' to the upside!

Somebody got rich Friday.  It just wasn't any of us...

Facebook shares close near $34 on 2nd day of trading

(Scott Eells / Bloomberg)Facebook Inc... Read more

Sent via Pulse/

Friday, May 18, 2012

Markets Down for Week

imageFor the week, Dow down 3.5%, SP500 down 4.3%, and the Nasdaq down 5.3%.  $$

The Facebook IPO was pretty lackluster, although it dominated the news all day long.  There was a delay starting trading, the NASDAQ had some problems filling orders or at least reporting on orders, and the stock fluctuated between $38-43 during the day.

I tried playing it for plus/minus $2, and hit the minus $2 pretty quick and bailed.  No sense holding and hoping. This thing could fall a ways once trading normalizes, especially the way the market is trending.

Sell in May working again.  Glad to be mostly in cash.

#171: $FB - Facebook Friday as Market Sells Off

Thursday, May 17, 2012

Sell in May Working Again

Sell in May and go away - it's working again. $$  

It's sad to see the losses mount in the latest wave of seasonal market selling. The reason du jour is Greece, Spain, or a slowing US economy. Maybe "all of the above."


The big question is how far is this thing going to fall?


I'm still mostly in cash with the low beta holdings. I dumped my pre-Facebook IPO play yesterday as it fell, just to lock in the gains and move on. Not sure if I will even try to play the $FB IPO tomorrow.


My strategy now is to wait for a summer trading range to develop and play it. So far, we haven't seen a bottom establish itself. But when it happens, this is where I'd look for retests of the bottom and top of the range to go long or exit the market. Not there yet... And hopefully we're not back in the secular bear market trend and heading much lower. Bleh.


Wednesday, May 16, 2012

Miserable Market Performance

$$ When the market moves higher in the day and gives it all back, then closes on a down note, it's not a good thing.  And that's been the stock market pattern recently.  Any strength is sold off at the end of the day.

Sell in May seems to be working again.

That Ugly Market Pattern Keeps On Happening

A pattern that we've observed before is how pathetic the stock market has been behaving these days. Each day we see periods of downs and ups, but in ... Read more

Sent via Pulse/

Fed Ready with More Stimulus

It seems as if the US economy is slowing down, as is the world economy. But the Fed is ready for another round of stimulus.

I get the feeling that the deficit and national debt don't matter anymore and that the country is just going to keep spending until it can't anymore.  You think at some point interest rates would rise - especially if the US credit rating takes a hit.

Fed keeps bond-buying door open
BUSINESS | MAY 16, 2012
Federal Reserve policymakers kept the door open to a fresh round of monetary stimulus, citing downside risks to a moderately expanding economy, accord... Read more

Sent via Pulse/

Tuesday, May 15, 2012

#170: Market at 3-month Lows, RSI, QQQ, FB

Monday, May 14, 2012

Watching the NDX RSI(2)

Have you traded using the RSI(2)? $$ The RSI(2) on the QQQ is .47. Oversold!

The average returns of stocks with a 2-period RSI reading below 1 significantly outperformed the benchmark
1-day (+0.30), 2-days (+0.62%), and 1-week later (+0.84%).

Chart from Stockcharts

Oil Prices at 5-month Low

Can we blame oil speculators if oil is at 5-month lows? Or will Obama take credit for that? $$

You know, when oil prices go up, it's the fault of the oil speculators. President Obama says Presidents have no control over oil prices. Will he say the same as oil prices fall?

I doubt it, too.

The good news is that declining oil prices eventually lead to declining gasoline prices. This means that when you and I go to "filler' up," it will cost less and at the end of the day we will have more money to spend on other things.

Oil prices hit five-month low
CNN MONEY | MAY 14, 2012
Oil prices sink more than $2 a barrel to hit a five-month low as investors fear fallout from Greece and JPMorgan... Read more

Sent via Pulse/


Groupon Rallies Big Today

I didn't see this coming. $GRPN up huge today and then again after hours on earnings and forward projections.

Yeah, 50% off on a day spa massage leads to big returns.

So the stock rallied 19% during the day and about 12% after hours last I looked.

When I heard that the company was reporting today, my first thought was "Look out below!" Yeah, contrarian alert. The exact opposite happened!


Groupon jumps 12% on narrowing losses
CNN MONEY | MAY 14, 2012
Groupon reports a narrower loss, better-than-expected sales and an optimistic outlook, giving investors hope that the worst is behind the company... Read more

Sent via Pulse/


Is Facebook our Avenger?

I know we're all watching the Facebook ($FB) IPO this week. Yes, the banks are crashing all around us, Greece may leave the Euro, France is socialist, California is a fiscal high-speed train wreck, and etc. On and on it goes.

But we're all bored with that. It all may mean the market in general can't go higher. After all, financial stocks are 20% or so of the SP500. As go the financials, so goes the SPY, right?

So we need a Super Hero. We need a Wall Street version of the Avengers.

And here comes Facebook. Now FB may raise their IPO range...


Facebook expected to raise IPO range to $34-$38 a share
CNN MONEY | MAY 14, 2012
Facebook is expected to raise the price on its initial public offering to $34 to $38 a share, a move that could lift the company's valuation to $81... Read more

Sent via Pulse/


Saturday, May 12, 2012

California Deficit Swells to $16 Billion

The CA budget deficit has swelled to $16B. $$ 

This would seem to be a problem, right? But this is quite easy to solve.  First, just project that voters will vote to raise taxes in November.  Next, project that tax revenues will increase due to economic recovery and higher tax rates.  Then, announce that there will be a government hiring freeze and staff cuts in the Highway Patrol, teachers, firefighters, prison guards, and others in the state workforce.  Finally, pass a budget that appears balanced based on all these things.  (We will hear some of that Monday, when Governor Jerry Brown presents the May budget revise.)

Then, in November 2012 it is likely the tax hike vote will have failed.  In 2013, none of the staff cuts will have happened and there will have been an actual increase in the state workforce.  Tax revenues will fall short of projections, and there will be another huge state deficit.

But then, they'll just do the same thing for the 2013-4 budget.

Apparantly, it's not a problem.  It doesn't seem to matter if the ledger balances out or not.

I remember back in college taking accounting classes, where I'd spend hour after hour on homework, trying to get the ledger to balance.  What a waste of time.  It doesn't need to balance!!!

California Deficit Swells to $16 Billion, Governor Says
California's budget deficit has swelled to $16 billion after tax collections trailed projections amid the tepid economic recovery, Governor Jerry Bro... Read more

Sent via Pulse/

Facebook - Embrace or be Wary?

Facebook ($FB), should we be worried or embrace the IPO? 

I've been overwhelmed by the negativity about the Facebook IPO the past week.  Seemingly, nobody wants any shares.  We're told institutions don't want any.  We're told retail investors are going to sit out.  We're being reminded that the internet IPO stories of the last year really haven't worked.

Contrarian alert?  Expect the opposite?  Is this IPO going to fly?


Plenty of Reasons to Be Wary of the Facebook Hype
One year ago, daily deals sites were all the rage. Shares of travel-deal specialist **Travelzoo** (NASDAQ: TZOO) were worth $74, three times what they... Read more

Sent via Pulse/

Friday, May 11, 2012

Playing the Facebook IPO

Hmm, how to play the big Facebook $FB  IPO...   $$ 

I'm not sure what I will do next Friday the 18th.  I don't know what to expect. On the one hand, I'm thinking shares will run up as folks want in to the next big thing.  And this isn't some rinky-dink company with a web site.  This is the place where hundreds of millions of people go.  It's potentially a huge business portal going forward.  Potentially.  

On the other hand, we've all seen the big IPO offerings that run up in the first few minutes or hours, only to fall and crush early investors later in the day or week as people book quick profits.  Who wants to get burned doing that?  And most of us remember the flame out of B2B stocks in the 2000s and even recent social network stocks.

My gut feeling is that this is the next Google.  That Facebook isn't going to go away.  Even with current valuation a big question mark, the demand for shares will be intense and drive up valuation. It's worth whatever folks collectively are willing to pay or not pay for shares, right?


Facebook IPO Approaching: Will You Buy Shares?

see photos**** Click for full photo gallery: The IPO Class Of 2012 A few weeks ago, a Consumerism Commentary reader asked me on Facebook whether it ... Read more

Sent via Pulse/

Why Chesapeake ... Got Crushed

Are you watching Chesapeake ( $CHK ) today?  The stock is down about 14% as I type. The poor thing has just been sold down relentlessly lately.  I follow it only because I have traded in and out of it before, and it's on my watch list. Seems like lately, all I do is watch the stock go down.  And this is with the recent bounce in natural gas prices.  

Too many problems going on there to try to trade that falling knife.  But still watching it.  We all love a good soap opera, right?

Why Chesapeake Granite Wash Trust's Shares Got Crushed
_Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're m... Read more

Sent via Pulse/

Stock Market "Not that bad" Despite JPM News

$JPM may be getting nuked by nearly 10%, but the rest of the market is holding up okay.  While it will be difficult for the overall index to move higher with financial stocks moving lower, there is some green on the screen this afternoon.

Stocks have retreated a bit after the surge higher (after the gap down), but tech seems okay today.  Tobacco seems okay today.  Telephones seem okay today.  Fast food... sodas...  Reits... 

Imagine the day it could have been without the $2B snafu from $JPM!

Stock market inches higher despite bank slump
AP BUSINESS | MAY 11, 2012

JPMorgan's surprise $2 billion trading loss prompted a sell-off in financial stocks Friday, but the broader market edged higher as investors decided ... Read more

Sent via Pulse/

Monster Stock Surges on Takeover Rumors

I know Warren Buffett and others have liked $KO (Coke) in the past, but have you noticed the young folks drinking these alternative soft drinks?

The last thing I personally need is more sugar and caffeine. My generation drinks the traditional sodas.  But the young kids seem to be migrating to these at the detriment of other beverages. How will this impact the Coke's and Pepsi's of the world?  

Monster shares surge on LinkedIn takeover rumor
CNN MONEY | MAY 11, 2012
Monster, which has been a rumored takeover target for years, said in March that it was considering selling all or part of the company... Read more

Sent via Pulse/

Wholesale Inflation Drops

Can't underestimate the positive impact less inflation has on our economy. $$ 

This means the Fed can keep rates low.  This means the Fed can continue to stimulate the economy.

Of course, on the other hand, it also could mean that the economy is slowing and there is less demand on stuff...

Wholesale Inflation Unexpectedly Slips in April

Producer prices unexpectedly fell in April as energy costs dropped by the most in six months, a sign of easing inflation pressures that could give the... Read more

Sent via Pulse/

Wednesday, May 09, 2012

#169: Sell in May in Election Year? ATT, Verzion, Sprint, Oil, Gold, Cisco..

Does Sell in May Work in Election Year?

Does Sell in May work in Presidential election years? $$

Same Darn Thing as Yesterday Randomosity!

  • imageSo far, the market sold off early and is recovering – Just like yesterday! $$
  • Boy, I was out this morning otherwise it would have been tempting.  Anyone else playing the “buy the dip” daily trade?  It’s been like printing money lately.
  • Today’s whipsaw brought to you by GreeceInvestors were whipsawed throughout the day by ongoing political negotiations in Greece, and worries that the troubled Mediterranean nation wouldn't get its latest package of bailout funds. But those worries were assuaged by the end of European trading, helping pare some losses.
  • Are the oil speculators driving oil prices down?  Well, ARE THEY?
  • Did you see that ATT and Verizon are going to have some sort of shared data plans that encompass multiple devices?  Thank heavens, because I’m tired of all these bills for different data caps. Of course, this could hit those companies’ profits, right?
  • Andrew Bynum said closing out teams in the NBA playoffs is easy.  Denver proved him wrong.
  • If I was playing the daily whipsaw trade and buying the early dip, I’d be quick to take profits.  I think the market is going to be very tough this summer.  Sell in May and that sort of thing.  My focus for the summer is short-term stuff with tight stops and quick profits.  Either way.  Stick and move, and throw lots of jabs.  Not trying to lay the big roundhouse punch.
  • Did you read where Bank of America may reduce mortgages for up to 200,000 homeowners?  Basically this would represent a 30% reduction. 
  • You know it’s an election year when the politicians are talking Gay Marriage, Abortions, Flag Burning, etc.  I wish people weren’t so dumb.  What about jobs and the economy?

Tuesday, May 08, 2012

Tuesday Market Thoughts

The market had a nice reversal today, but many problems remain and the market seems very vulnerable to news flow $$ 

I know, maybe that's stating the obvious. Sure seems like the market is whipsawing around and not making any headway.


I remain with a lot of cash and low beta stocks. Just watching baseball and NBA.



Argh, tough Dodgers loss 2-1 to the Evil Giants.

Saturday, May 05, 2012

Warren Buffett on $AAPL and $GOOG

Warren Buffett says that $AAPL and $GOOG are too risky for Berkshire. But, he says, "I sure as hell wouldn't short them either."  He added that he wouldn't be surprised if both are worth a "lot more" in ten years.  

Both stocks have had great growth. What do you think?  Buy and hold or sell in May?

I think the summer correction has a ways to go.  No need to initiate a position in anything at this point.  Of course, if one has a low cost basis maybe it doesn't make sense to cash out and incur a huge tax hit.  In addition, many folks have made a ton of money over the long term by holding winners and letting those winners run.  But, I'm just not sure about initiating new positions at this point, right

Friday, May 04, 2012

Who Said It? Mitt Romney or Mr. Burns?


Who Said It? Mitt Romney or Mr. Burns?

... Read more

Sent via Pulse/

5 reasons to not 'like' Facebook's IPO - Contrarian Alert?

Lots of folks seem down on the Facebook ($FB) IPO. Are they contrarian indicators? I'm thinking that this finally may be one worth taking a look at.  Of course, do you do that on day one or later? After all, if we are in a summer correction, then maybe there will be a better buy in price in the months ahead.

5 reasons to not 'like' Facebook's IPO
CNN MONEY | MAY 4, 2012
Slowing growth, a reliance on ads and growing competition make a $100 billion market value a stretch for Facebook... Read more

Sent via Pulse/

Obama administration tightens fracking rules

One reason Natural Gas prices won't be low forever. $$ 

If Obama cracks down on fracking, while cracking down on coal as American turns to natural gas for more energy production, something has to give.

Obama administration tightens fracking rules
CNN MONEY | MAY 4, 2012
The Obama administration tightened rules on hydraulic fracturing Friday,... Read more

Sent via Pulse/

Fat Guy Tries Trampoline Dunk

The economy may be toast, but gravity still works. 

Fat Guy Tries Trampoline Dunk, Fails Spectacularly

This happened on Tuesday, but the GIFs and videos are just now surfacing. And boy are we glad there's visual proof of a rather large fan trying to dun... Read more

Sent via Pulse/

Worst Week of the Year Randomosity

  • imageWhy Paul Krugman is mostly wrong. $$ Krugman says that all we need to do to get the global economy going again is for the governments of the world to start spending a lot more money.  Well, debt is the issue, right?  $16T and growing.  The interest on the national debt is a large percentage of the budget.  All of this Keynesian stuff may work if the government followed it in good times and balanced the budget, and paid off debt!
  • The SP500 has the worst week of the year. Reason du jour?  Jobs! Or lack of jobs!  Thank goodness so many people dropped out of the labor force, so that the unemployment rate didn’t go up! /snark
  • And Euro worries.  Don’t forget that.  Always Euro worries.
  • By the way, $AAPL clossed at $565.25.  Remember when Apple gapped up to $610 after earnings?  Filling the gap!  Yikes.  I think it’s below the 50dma now, right?
  • Lots of households cutting the cord on pay-TV.  The number of U.S. homes subscribing to a pay-TV service fell by 1.5M in 2011, Nielsen estimates, as subscriber gains of 1.1M and 280K from telco and satellite providers, respectively, failed to offset the loss of 2.9M cable subs.  So, lots more options out there, considering Netflix and Hulu.  Although some of these companies will get you on the backside with bandwidth charges.
  • Dodger Town:  Cubs win!  Cubs win!  Missed the day game, but LA had a chance in the ninth. 
  • Oil futures fell 4%. 
  • Worst week in SP500 since December 16th.
  • Nasdaq worst week since late November.
  • Southwestern Energy ($SWN) was down over 7% today. Hey, aren’t utilities a “safe haven” during troubled times?  Except for SWN, I guess.  They missed earnings by a penny. One cent.  Poof, 7.2% freefall.  Plus, commodity prices are having a rough go of it, especially natural gas.  But watch that, because so many companies are cutting back on natural gas production at the time when the government is waging war on coal and the country will need more natural gas. 
  • Hey, Mariano Rivera, why don’t you go shag some fly balls…. oops.

Jobs Data

imageThe stock market is crashing down on the jobs data. $$ #sellinmay

Hey, it’s a good thing the unemployment rate fell to 8.1%.   Okay, yes it was because more people quit looking for work altogether.  Heck, if another 10,000,000 dropped out of the workforce, President Obama would have a 5% unemployment rate!

Folks were expecting around 165,000-ish new jobs.  But there seemed to be an underground consensus that the number was going to come in light, around 125,000.  Although some fringe estimates were up near 200,000.  The number came in at 115,000.

So that was lighter than the gloom and doomers were thinking.  Plus, the Fed is likely to just keep saying that they’re at the ready and that one or two numbers don’t make a trend.  Although they can speak for themselves in the weeks ahead.  They normally do!

I remain mostly in cash and with some low-beta holdings – which are rallying right now a bit.  A bit. When everything is red, it’s hard for anything to move up.

Sell in May…

Thursday, May 03, 2012

The Night Before the BLS!

The BLS report comes in tomorrow and estimates are all over the map $$.

It seems as if the consensus on new jobs is around 165,000 to 170,000.  Many are already assuming that the number will be much lower, and that may not be bad news as it would spur the Fed to keep stimulating the economy.  On the other hand, it would continue the theme that this economic recovery is the worst in US history.  If the number comes in higher, then the Fed moves to the sidelines and the country gets to worry about rising interest rates.

Always something to worry about!

The outlier is that the number comes in as expected, and nobody has a clue what comes next from the Fed or the economy.

Stocks in the News Randomosity

After hours today...


  • First Solar ($FSLR) reported an unexpected quarterly loss. Really? Unexpected? Who’s buying that these days? They lost $449.4 million in the first quarter. That's a chunk of change!
  • LinkedIn Corp reported better-than-expected revenue and profit and provided improved guidance for 2012. I think they help companies find and hire employees. Nobody uses it as a social network, do they? Last I checked, shares of LinkedIn were up 9 percent in after-hours trading.
  • Caribou Coffee ($CBOU) was down about 12% on lowered sales outlook and slowing growth in the single serve coffee brewer market. That’s after being down 15% during the regular trading session. It sucks if you’re not Starbucks….
During the day


  • GM shares fell 2.4 percent after the automaker said its first-quarter profit declined, mainly because of weakness in Europe. Blame it on Europe!
  • Prudential ($PRU) was today’s winner of the “worst stock in the SP500” down 10% after yesterday’s earnings report. The company lost nearly a billion dollars due to a $1.5 billion charge relating to currency fluctuations and derivative impacts mostly linked to the Japanese yen’s decline against the US dollar.
  • Allstate ($ALL) was up 4% on a 46% profit rise due to improved operating income and realized capital gains.


Thursday Decaf Randomosity

    • Green Mountain Coffee ($GMCR) is down nearly 50% today as the company slashed its 2012 outlook due to sluggish sales of its single-cup Keurig brewers and portion packs. A lot of this may be competition. I don't think people have stopped drinking coffee! Maybe there is saturation in the Keurig machines.
    • In March, Starbucks ($SBUX) announced that they would be offering their own single-cup machine called the Verismo at the end of the year.
    • Wouldn’t you rather own Starbucks? Remember the concept of “Gorilla Investing” from back in the 90s? Anyway, if you’re buying the powerhouse, wouldn’t you want Starbucks? In addition to coffee on every corner, expansion in China, they’ll be offering a single-cup brewer. I bet it does really well, and I feel sorry for the competition. No positions in coffee stocks as of right now.
    • Target ($TGT) is going to stop carrying the Amazon ($AMZN) Kindle in response to Amazon’s practice of undercutting practice. Target is testing expanding their displays of Apple’s ($AAPL) products. Wal-mart ($WMT) is also testing offering Apple stores within Wal-marts.
    • 30-year mortgage rates are at record lows at 3.84%. The 15-year is also at an all-time low at 3.11%. But I just refinanced two months ago! I don't want to go through that again! We keep waiting for runaway inflation... And waiting... And waiting...
    • By the way, I love my Keurig machine. Make a lot of iced coffee.
    • OPEC says they’re working hard to bring down oil prices. Working through lunch. Eating lunch at their desks. Working on weekends. Staying past 5pm. Working through American Idol. "We are not happy with prices at this level because there will be destruction as far as demand is concerned," OPEC Secretary General Abdullah al-Badri told an energy conference.
    • The Los Angeles Times reported on California’s budget deficit and the continuing faulty projections by the state’s bean counters. For this April’s taxes, taxpayers are receiving more than $2.6B in tax refunds. Accountants had projected to pay out only $2B. That’s a 30% miss. In addition, Governor Jerry Brown was off by 20% in his income tax projections, and 10% off in corporate tax projections. That amounts to about $3B. So, it’s tough to tell how bad the state deficit really is at this point. I believe the last number I heard was $9B, but Jerry was counting on voters voting to tax themselves in November to cover much of that. Long shot, Jerry!
    • Angels pitcher Jered Weaver pitched a no hitter in Anaheim against the Minnesota Twins. His mom and dad were in the crowd. Did you see dad in the ninth with a big ol' beer? Lol. I watched the 8th and 9th innings on the iPad MLB app!

Wednesday, May 02, 2012

#168: Junior Seau; Sell in May and Go Away