Happy Armistice Day to one and all! I know I’m not the only one looking forward to the day when peace reigns for the citizens of this nation once more.
That said we can ponder what peace means to a nation where the government took the day off but the stock markets didn’t, but that’s okay considering the big financial houses now claim they are actually doing ‘God’s Work’…who knew?
Um, perhaps a bit more perplexing is the fact that despite the two rather diverse headlines tonight’s offering ran under (and I believe it has changed yet again.) The ‘Stupidity Index’ hardly budged all day…go figure.
Without further adieu;
Dollar Slips Back and Stocks Turns Up
By JAVIER C. HERNANDEZ
Published: November 11, 2009
Wall Street equity markets opened higher on Wednesday as the dollar sunk to a 15-month low and Asian countries reported robust signs of economic growth. [At this point in the game the Dow was only plus 20 so it’s hard to imagine what he means by stocks ‘turning up’? One could suppose that would be true of any ‘non-negative’ number…but 20 fucking points, gimme a break!]
While many analysts are concerned the recent surge in the equity markets has been overdone given the economy’s weakness, a growing belief that wealthy nations like the United States will forge ahead with efforts to revive economic growth is luring risk-shy investors back into the stock markets. But the low interest rates has the dollar swooning. [Are you confused yet good citizen?]
Overnight, the dollar’s value fell against most other world currencies, trading at slightly over $1.50 against the euro early Wednesday. Persistently low interest rates in the United States have kept its pay-off meager, sending investors seeking high returns to the world’s stock markets. [Just like all of those hopeful retiree’s looking to make a killing in the markets! And ended up getting killed instead…]
“People want their money in anywhere but dollars right now, whether in commodities, foreign equities or equities themselves,” said Andrew J. Neale, portfolio manager for Fogel Neale Partners. [You know the drill: who is this and why should I care?]
On Tuesday night, a Federal Reserve banker reinforced said the drop in the dollar’s value had not been “disorderly,” and he said interest rates would likely remain low for an extended period, Reuters reported. [Um, this naturally begs the question of what a ‘disorderly drop’ of the world’s reserve currency would look like…but strangely, I think you’ll know it when it happens.]
As the dollar fell, gold continued its climb to record highs, trading at $1,116.82 an ounce early Wednesday. [What’s really bizarre here good citizen is why gold is climbing at all. It ‘used to be’ money but it’s not today. In fact, there isn’t a nation on the face of the planet that still uses gold as ‘legal tender’ (because it’s too damned dangerous!) So it is foolish in the extreme to be buying gold and expecting anyone to ‘honor’ the price when that price could very easily return to $35 an ounce.]
The zeal from strong trading days in Europe and Asia seemed to perk up Wall Street. In afternoon trading, the major stock averages in Britain, Germany and France were up more than 1 percent. Overnight, the Hang Seng in Hong Kong rose by 1.6 percent, while the Nikkei in Japan stayed flat.
In early trading, the Dow Jones industrial average was up 46 points, or 0.4 percent. The broader Standard and Poor’s 500-stock index rose 0.59 percent, and the technology-heavy Nasdaq composite index fell 14.95 points, or 0.7 percent,.
As the market continues to rise, many investors ignored signs that consumer spending, which accounts for 70 percent of the U.S. economy, might not bounce as rapidly as some analysts might hope. [And those analysts do have a whole lot of hope…even if they are consistently being proven wrong!]
“The consumer is still not spending well,” Mr. Neale said. “Until there’s some sign of strength in the jobless market and housing market, then the consumer will remain on the sidelines.” [Um, the consumer is broke…I know that and you know that and I’m willing to bet he knows that…but it’s his job to sell stocks, so he’s got to pretend things are other than what they are…]
In a sign of retail spending, the department store Macy’s reported that its third-quarter losses were $9 million less than the year before. However, its projections for future profits did not meet Wall Street expectations.
The United States bond market was closed on Wednesday because of the Veteran’s Day holiday.
Today’s ‘bonus feature’ (for those still up for more reading) we have this excellent piece by one of my favorite writers, Henry C.K. Liu.
If you need more proof that capitalism is FUBAR, click here
And finally, take a gander at how tonight’s offering has ‘morphed’ over the course of the business day…
Stirred by a Weakening Dollar, Markets Rise
By JAVIER C. HERNANDEZ
Published: November 11, 2009
The chain reaction started by the weakening dollar continued to rock the stock market, the gold market and the oil market on Wednesday.
In mid-morning trading, shares on Wall Street were higher, the price of gold continued its climb, and oil prices rose.
At the center of Wednesday’s movement was the tumbling dollar, which hit a 15-month low overnight before easing below $1.50 against the euro. Persistently low interest rates in the United States have meant meager returns, forcing investors to other alternatives.
While many analysts are concerned the recent surge in the equity markets has been overdone, given the economy’s weakness, a growing belief that wealthy nations like the United States will forge ahead with efforts to revive economic growth is luring risk-averse investors back into the stock markets.
But low interest rates have the dollar struggling.
“People want their money in anywhere but dollars right now, whether in commodities, foreign equities or equities themselves,” said Andrew J. Neale, portfolio manager for Fogel Neale Partners.
In Tokyo on Wednesday, Treasury Secretary Timothy F. Geithner said he considered a robust dollar an important part of an economic recovery.
“I believe deeply that it’s very important to the United States, to the economic health of the United States, that we maintain a strong dollar,” Mr. Geithner said, according to news reports.
Some analysts, however, believe that behind closed doors, policy makers in Washington are happy to see a slow and steady depreciation of the dollar. The weak dollar makes American products cheaper overseas, buoying sales, and makes imports more expensive, encouraging consumers at home to buy American.
On Tuesday night, a Federal Reserve banker seemed to hint at that view, saying the drop in the dollar’s value had not been “disorderly” and that interest rates were likely to remain low for an extended period, Reuters reported.
As the dollar fell, gold reached $1,116.82 an ounce early Wednesday.
The zeal from strong trading days in Europe and Asia seemed to perk up Wall Street. In afternoon trading, the major stock averages in Britain, Germany and France were up more than 0.5 percent. Overnight, the Hang Seng in Hong Kong rose by 1.6 percent, while the Nikkei in Japan stayed flat.
In mid-afternoon trading, the Dow Jones industrial average was up 33 4 points, or 0.33 percent. The broader Standard and Poor’s 500-stock index rose 0.42 percent, and the technology-heavy Nasdaq composite index rose 0.58 percent. Crude oil settled at $79.25 a barrel, up 20 cents.
Strong economic outlooks from China gave investors hope that the global economy was on track to recovery.
As the market continue to rise, many investors ignored signs that consumer spending, which accounts for 70 percent of the United States economy, might not bounce as rapidly as some analysts might hope.
“The consumer is still not spending well,” Mr. Neale said. “Until there’s some sign of strength in the jobless market and housing market, then the consumer will remain on the sidelines.”
In a sign of retail spending, Macy’s reported that its third-quarter losses were $9 million less than the year before. However, its projections for future profits did not meet Wall Street expectations.
The United States bond market was closed on Wednesday because of the Veterans Day holiday.
Certainly leaned a bit on the darn ‘delete’ key, didn’t he?
I’d inclined to ask what your thoughts are good citizen? Do you think the ‘patriotic’ investor class took the day off to honor peace and give thanks for the military might that lets these same weasels exploit the resources of the planet for their own personal gain?
Which begs the question as to whether or not the investors actually think the market is ‘overbought’ or are they ‘taking a breather’ as the pundits like to say when the markets are inexplicably quiet?
Personally, it feels like a ‘Wile E. Coyote’ moment to me as there is nothing but ‘hot air’ under the current market and it’s going to be devastating to watch the Dow plunge below 5,000 when the promised ‘recovery’ fails to materialize…
Just something to ponder until next time…
Thanks for letting me inside your head,
Gegner
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