Free Republic

Why is the Stock Market Rising When The Economic Recovery is Weak? Stock-Markets / US Interest Rates Nov 10, 2009 - 04:35 AM By: John_Mauldin "Why" many ask, "is the stock market going up when the bond market is telling us the recovery will be tepid? Isn't there a disconnect?" And the answer is that there is, and this week good friend and fishing buddy Paul McCulley of PIMCO fame discusses that very topic with his usual insight and wit. He poses the conundrum that those expecting a "V" shaped recovery have pushed risk assets up quite high, and that...

Stocks Rocket To Biggest Gains Of 2009 Vince VenezianiNov. 9, 2009, 4:03 PM Today was one for the record books. The Dow Jones Industrial Average hit its 2009 year high today, going as high 10,228 in late afternoon trading and finishing at 10,227. The NASDAQ didn't do too bad either, ending up 41 points at 2154. The S&P 500 was able to gain 23 points to close at 1093. The Federal Reserve today also released a survey that shows banks are still limiting the amount of credit offered to both businesses and consumers. The market couldn't have cared less. Gold...

Stock Market Investors Needn’t Fear A Double-Dip Economic Recession Nov 09, 2009 - 05:56 AM By: Money_Morning Jon D. Markman writes: A new report contains some very good news for investors: Double-dip recessions are very rare. That means that a drop back into recessionary conditions looks less and less likely even as unemployment creeps higher and has crossed the 10% threshold for the first time in a quarter century. After reviewing U.S. economic history all the way back to the 1850s, Deutsche Bank AG (NYSE: DB) economists found that double-dip recessions are exceedingly rare: There have only been three episodes...

Wall Street: Dumb as It Ever Was November 06, 2009 | about: DIA / QQQQ / SPY Todd Kenyon I had to take a few moments away from shouting at the circus-of-the-inane on CNBC to vent. All the focus on this jobs number this morning should confirm to any rational person that the great majority of what goes on in Wall Street is a complete waste of time at best and a criminal destruction of value at worst. Being trained as a scientist in a former life just makes it harder to watch this garbage. Yesterday afternoon some random NYSE...

The perception of American voters and other nations around the world toward the United States Government is the United States is currently operating under a weak and indecisive leader. With every day that passes the Congress,...Read full article http://wwwstateofamerica.blogspot.com/2009/11/leader-position-open-united-states.html

Economic Recovery, The Great Hoax of 2009-2010 Economics / Economic Recovery Nov 02, 2009 - 07:40 AM By: Martin_D_Weiss Before he died, Dad warned me of false profits … and fake promises. “Beware,” he said, “of shaky gains hyped up by Wall Street. “Watch out,” he insisted, “for unsustainable economic recoveries trumpeted by Washington. “And no matter when or where you may be, don’t be fooled by illusions of wealth and prosperity. “If they’re built on a foundation of shaky debt, they’re suspect. If they’re driven by unbridled speculation, they’re pure fluff. And if they’re bought and paid for by...

Bob (Janjuah) Is Back... And He Is Pissed Submitted by Tyler Durden on 11/02/2009 10:53 -0500 Asset Bubbles banking banks Ben Bernanke bernanke Bob Janjuah British Pound Bunds C China CPI Credit Debt Deflation Demographics earnings ECB economy Equities Euro European Central Bank Fail Failures Fiat FX GDP Gilts Gold greed Gross Domestic Product History IG Inflation ISM Japan Key money pay policy prices RBS Recession risk stocks Turkey Unemployment United Kingdom US USD USTs Volatility Bob's World: Happy Christmas, Cold Turkey Time There are 5 things that really matter now: There are 3 'players' - the Private Sector ('PS')...

Week Ahead: Volatility, the Fed and Plenty of Economic Data Published: Sunday, 1 Nov 2009 | 10:25 AM ET Text Size By: Patti Domm Executive Editor Brace for more volatility in the week ahead as investors wrestle with dual concerns that stocks have gotten too pricey and that the economic recovery is just too uncertain. Stocks start November on wobbly footing, after the past week's selling helped erase October's gains and pushed the S&P 500 to its first monthly loss since March. The Dow fell 2.6 percent for the week, finishing at 9712 but it was a half percent higher...

The US Recession Is Not Over, But The Stock Market Party Is Economics / Recession 2008 - 2010 Oct 31, 2009 - 08:17 AM By: Andrew_Butter “Technically” it’s over, perhaps, but that 3.5% annualized was entirely due to the government borrowing money and giving it to people to spend on things that will not generate long-term economic value: Cash for Clunkers (1%) + $8,000 New Homebuyers (1%) + Government Spending (0.5%) + This and That (1%) = 3.5%. To achieve that superb magic trick the government took on how much debt? I’m not going to bother with trying to unpick...

Stocks Get Spooked By Elizabeth Trotta 10/31/09 - 02:56 PM EDTNEW YORK (TheStreet) -- Volatility spiked, and a strengthening dollar, compounded with a soft consumer spending report and sustainability fears, made for a dreary close to the month and what one observer called "a precarious position." October held true to its reputation as a bad month for stocks: The Dow Jones Industrial Average edged up less than one half of a point; the S&P 500 lost just less than 2%; and the Nasdaq fell 3.6%. Much of those losses materialized Friday. The Dow lost 249.85 points, or 2.5%, to 9709,...

Islam is on its march of death on many fronts. A very dangerous front has been recently re-opened at the United Nations (UN) by the Organization of the Islamic Conference (OIC), the largest group of nations within the UN, by introducing a new resolution. The resolution under consideration—Defamation of Religions—aims to enlist the power and prestige of the UN in defense of religion by declaring religions to be immune from the general discourse practiced in non-religious domains. The aim of the resolution is to impose a gag order on people against breathing a word that religionists may find defaming or...

Wall Street fear gauge jumps to July levels By Laura Mandaro, MarketWatch SAN FRANCISCO (MarketWatch) -- An options index known as Wall Street's fear gauge surged Friday to a nearly four-month high, as a fresh round of worries about the sustainability of recent months' rally surfaced. The CBOE's Volatility Index (INDEX:VIX) gained 24% to 30.69 by the exchange's close, its highest closing level since July 8. For the index, which uses options contracts based on the S&P 500 Index (INDEX:SPX) to measure market expectations of near-term volatility, it was the biggest percentage gain since late 2008, near the peak of...

NYSE Open Disrupted By Flood Of Orders On 2:44 pm EDT, Friday October 30, 2009 NEW YORK (Reuters) - A huge influx of orders prevented the New York Stock Exchange from disseminating quotes shortly after the start of trading on Friday. (NYSE:NYX - News; Paris:NYX.PA - News), the parent of the exchange, said the delays followed "an inordinate influx" of orders received as Friday's session got under way. Later in the session, the company had to temporarily transfer quote processing to a backup system. The exchange's quote delays caused some tickers to be locked, but an NYSE spokesman said "trades...

U.S. stock investors should curb expectations, adviser says Technology, materials and industrials should perform as economy recovers By Kate Gibson, MarketWatch NEW YORK (MarketWatch) - As stock investors hunt for higher returns in light of what some are calling a "new normal" of reduced expectations, analysts point to early- cycle stocks as among those that stand to gain as Asian demand for goods picks up. Equities investors accustomed to an average rate of return in any rolling 20-year period at around 11% would be wise to adjust their expectations downward, says Doug Lockwood, chief investment officer at Cornerstone Wealth Management....

Roubini Sees Market Crash All Over the World By Rocky Vega 10/29/09 Stockholm, Sweden – New York University Professor Nouriel Roubini, who recently saw the recovery as “U-shaped,” is now concerned a dollar rebound will cause global markets to crash. His main concern is the carry trade in the US dollar. The dollar is being borrowed at near-zero interest rates to then be invested into a wide array of now-popular assets including gold, commodities, equities, credit, and emerging markets. There are simply more dollars available in the system that are chasing the same types of things. The risk is that...

At least five people have been killed and 35 wounded by a large blast in a market in Peshawar, Pakistani, local media say. Huge plumes of black smoke were seen drifting over the city. Pakistan has seen an increase in such attacks in recent weeks as the military carries out an operation against Taliban militants in South Waziristan. The blast comes as US Secretary of State Hillary Clinton begins a visit to the Pakistani capital, Islamabad. Pakistani television showed footage of burning shops in Peshawar, in the northwest of the country, and ambulances rushing to the scene

Netbook gravy train starts to slow as euphoria fades Netbook shipments have started cooling after witnessing an explosive surge since late last year as customers started realizing its limits and looking for portable and affordable alternatives for full-size laptops. According to Xia Li, vice-president of Lenovo Group, growth in netbook sales during the second half of this year has slowed as consumers have started becoming more rational in their purchases. "Netbook sales surged in the past as consumers bought the product as gifts or as first laptops," he said. But with consumers starting to realize the limits of the products,...

Jeremy Grantham: The Sucker's Rally Is Almost Over Posted Oct 27, 2009 08:30am EDT by Henry Blodget: Jeremy Grantham of Boston-based GMO called the crash. He also called the rally. He also called a whole bunch of stuff before that--although, as he is the first to admit, like other value folks, he does have the habit of being early. Not this time, though. Within days of the March low, Jeremy published "Reinvesting While Terrified," in which he observed that it was time to bet the farm. He soon called for a stimulus-fueled rally that would take the S&P 500 to...

Why Is the Market Going Up When Jobs Are Going Down? Invest With An Edge October 26, 2009 Brandon Clay Last month the national unemployment average rose to 9.8%. It’s actually at 17% if you count distressed and underemployed workers. Not only is unemployment data weak, it’s getting worse. Former Fed chairman Alan Greenspan said unemployment would hit at least 10% before turning back. Even with this well-known data, the market is going up. The S&P 500 is sporting a mostly gentle uptrend from March to October. The market thinks we’re recovering. Bernanke and company have said as much. However,...

How Much Juice Is Left In This Bear Market Rally? By Bill BonnerOctober 23, 2009 10/23/09 Waterford, Ireland – Since it peaked in 2007, the UK stock market lost 60% of its value. As of yesterday, it had recovered half of what it had lost. All over the world, the story is about the same. Markets have recovered half or more of what they gave up. The US is a laggard. While the S&P is up 60%, the Dow isn’t yet at the halfway point. Some foreign markets, meanwhile, have 100% + gains. Fund managers who missed the rally are...

A Big, Fat Stock Market Selloff By Eric Fry 10/20/09 Laguna Beach, California – Stocks prices are very, very high… Our contrarian colleagues over at The 5-Minute Forecast continuously lament…which means that the collective anxiety of investors is very, very low. Our colleagues don’t mind that a rising stock market is adding trillions of dollars to the asset side of household balance sheets. That’s good news. But the worrisome part is that a falling stock market could erase those trillions from the ledger just as quickly as they first appeared. And as our colleagues correctly point out, rising share prices,...

The free market is not up to the job of creating workBy Mort Zuckerman Last updated: October 18 2009 19:21 America has always been a country that thrives on hard work, thrift and self-reliance. We have all absorbed Benjamin Franklin’s maxim: “Early to bed and early to rise, makes a man healthy, wealthy, and wise.” This helped create jobs. In an application of Schumpeter’s notion of creative destruction, the US lost 44m jobs in the last two decades of the 20th century, but simultaneously created 73m private sector jobs. A stunning 55 per cent of the total workforce was in...

Listened to an interesting talk today by Jared Bernstein, chief economist to Vice President Joe Biden, at a New America think-tank conference on job creation. A few observations: 1) If Bernstein’s talk was any indication, don’t look for much public celebration by the White House if we get some good 3Q and 4Q GDP numbers. As he put it, “Absent robust job growth, it is not a true economic recovery.” He stressed this point several times. I don’t even think you will hear an administration official use the word “recovery” in 2009. 2) Bernstein trotted out several interesting slides —...

The Market Suspense Continues by: David Brown October 20, 2009 On Monday of last week, I posed the question whether the market was about to break out or top out, and for most of the week breaking out seemed the likelier outcome. The plethora of positive earnings, together with better-than-expected revenue from a number of major players -- Google (GOOG); JP Morgan (JPM); Intel (INTC), among others -- fueled the market onward with the Dow crossing 10,000 and the S&P 500 approaching 1,100. The economic indicators were generally good as well, with slightly improved new jobless claims, a very pleasant...

October 2007 Shows Us How This Rally Ends By Ron Coby On 2:10 pm EDT, Monday October 19, 2009 Crisis, What Crisis? As I scroll through hundreds of charts, I continually see that markets are right back to where they were before this credit crisis began. It's almost like investors have completely forgotten why markets collapsed more than 50%. They must believe the Federal Reserve has once again saved the day. Who can blame them really? The Fed saved the day in 1987, 1997, 1998, and 2001, so why not today? You know the formula: Markets correct or crash, the...

Wall St Week Ahead: Earnings Blitz To Test Market's Mettle Sun Oct 18, 2009 10:53am EDT By Ellis Mnyandu NEW YORK (Reuters) - U.S. stocks could slip this week if the spate of earnings from bellwethers including Apple Inc (AAPL.O) and Caterpillar Inc (CAT.N) do not live up to heightened expectations. After a 60 percent run-up in the stock market since March and the Dow again eclipsing 10,000, investors believe the market is priced to perfection. So if earnings fail to hold up their end, stocks could come under pressure.[snip]

I remember that just a year ago people on the Left were excited with the Dow’s fall because the “rich” on Wall St, “the wealthy,” were losing money. So… why are they now excited with the Dow’s 10,000? Furthermore, in late ’03, under President Bush, the Dow in a period of just a few months reclaimed 10,000 of its 7,600 low. I do not remember the left calling that a “recovering” economy, and in November ’06 when the Dow was at 12,000, the Left didn’t call it a “good” economy either.

WASHINGTON (Reuters) - Aided by a bleak job market, the U.S. military met all of its recruitment goals in the past year for the first time since it became an all-volunteer force in 1973, the Pentagon said on Tuesday. Military services have been stretched thin by conflicts in Afghanistan and Iraq, giving added weight to recruitment efforts as President Barack Obama considers sending another 40,000 U.S. troops to Afghanistan next year.

Stock Market Bull Trap Heading For A 50% Crash To 5,000 Stock-Markets / Financial Crash Oct 13, 2009 - 11:00 AM By: Captain_Hook At the risk of getting ahead of myself prior to being able to confirm the turn, I am suggesting stock market action over the past week bears the distinct odor of a bull trap, with even informed technicians still waiting for a push to 50% retracements on the indexes. In this respect then, you should realize the context of such a bull trap would be profound in that we are talking about the March lows being tested...

With the prospect of higher unemployment hanging over the markets, some experts expect a correction. So are they right? Michael Cuggino, president and portfolio manager at Permanent Portfolio Funds, and John Lekas, CEO and portfolio manager at Leader Capital, shared their insights. (See their recommendations, below.) “I think we go below the double dip,” Lekas told CNBC. “By year-end, we drop below 6,300 on the Dow and by 2011, we’re at 4,200.” Lekas said although Monday's ISM services index was “neutral,” the unemployment number was at 785,000 last month and that number is expected to worsen. “So 26 to 27...

snip... A Genuine Solution The solution to America’s health care problems is not more government intervention. Government violations of individual rights through government interference in the marketplace are the source of the problems. Government meddling in health insurance has all but eliminated choice, competition, and innovation, and has driven up the cost of health insurance. Government interference in medicine has caused incalculable harm to both patients and doctors, and driven up the cost of health care. Government controls have bred more controls, as politicians and bureaucrats have tried to “solve” the problems created by one set of regulations by imposing...

A rapid rebound in credit markets this year has lured Americans into putting more of their savings into bond funds, which has helped push prices higher and bring in more cash. High-yield corporate bonds have jumped nearly 49% this year. If investors expect a repeat performance, they're in for an unhappy surprise, said Ashish Shah, Barclays co-head of global credit strategy. "There's money coming in from investors looking for the next 49% to happen, and it so obviously isn't going to happen," Shah said. The problem for bond buyers is actually a good thing: the start of robust economic growth

Pound Slides Again As Markets Enter Bank of England-Fuelled Bubble' StageThe pound slid closer to parity with the euro on Monday, as one of London's leading hedge fund managers warned stock markets are in a Government-fuelled bubble.By Edmund Conway and Jamie Dunkley Published: 6:26AM BST 22 Sep 2009 "Markets are now entering a bubble phase [which may last] until the end of the year," said Crispin Odey of Odey Asset Management. However, the bubble is almost entirely dependent on the Bank of England's quantitative easing (QE) policy, through which it is creating £175bn and pumping it into the system by...

Tim Geithner, the Goldman Sachs Secretary of the Treasury, has gone on record as saying that the government will withdraw its $3 trillion backstop guarantee from the money market fund industry, on schedule, today, September 18th. While I am for any reduction in the government's role in the economy, this decision is pretty interesting. Why would they do it now, when even a cursory examination of the real economy shows that things are shaky and rocking the boat on investor confidence seems a bit of a gamble? I will try to answer that question, but only after stepping back to...

First lady Michelle Obama attends the opening of FRESHFARM market's new farmers' market with Assistant White House Chef Sam Kass (L), a few blocks away from the White House in Washington September 17, 2009. First lady Michelle Obama bought cheese, fingerling potatoes, eggs, black kale and other items Thursday at the launch of a new farmers market blocks from the White House.

On March 28, 1985, President Ronald Reagan made his first of two visits to the NYSE to salute the robust American expansion, as well as the central role of the New York Stock Exchange as the nerve center of entrepreneurial capitalism. President Reagan was the first sitting U.S. president to visit the NYSE. At 9:53 a.m. that morning, President Reagan—amid a roaring ovation—addressed the Exchange community from the bell podium. Flanked by his chief of staff, Donald T. Regan and NYSE chairman and CEO John J. Phelan, Jr., President Reagan proclaimed: “We’re bullish on the American Economy. The American Economy...

Does anybody know how the market responded to 0's speech today?Thanks!

Remember, the values at which subprime mortgage bonds were trading at reflected "irrational fear" and "unreasonable expectations of default." More than a year later, it is clear: There was no panic; this was a JUSTIFIED level of trading and reflects the ugly reality - the investors in those bonds will NEVER get their money back. They were swindled, to be blunt. "AA" bonds trading at 4 cents and "AAA" at 28? Remember folks, "AAA" credits are supposed to have a probability of default roughly equivalent to that of the Sun colliding with the earth. There is not now and never...

WASHINGTON -- Whether it's a motorcade or a security perimeter, D.C. drivers are pretty accustomed to road blocks and disruptions, but even the most seasoned D.C. road warrior might be a little upset to find his commute may have to change because of a farmers' market. The Office of First Lady Michelle Obama is supporting a request to periodically close a section of Vermont Avenue, not far from the White House, for a farmers' market. "You know Michelle set up that garden in the White House," Obama said. "One of the things we're trying to do now is to figure...

Any time corporate executives and directors are heavily selling their company's stock there's reason for concern. And lately they've been doing just that. The last time insider selling was as high as it is now was in the period from late 2006 to late 2007. It was right after that insider-selling surge that the stock market began its long painful decline, says Charles Biderman, CEO of TrimTabs, an independent institutional research firm. Biderman believes that insider trades shoot higher when there's a disconnect between broad market opinions and what business executives feel in their gut. "When [insiders think] things are...

In its essay "Lets Have It Out On Single Payer", the Treatyist argues that Republicans should go on the offensive on health care by introducing a comprehensive package to allow market forces to work in the health market. Democrats claim that the present health system is a free market failure. The fact is, the health insurance system is riddled with market distortions. Our free market plan is roughly as follows: 1. Get rid of non-risk "coverage" mandates that pervade health insurance. Health insurance should be for catastrophic risk. Routine medical visits and other "wellness" features belong in discount plans, not...

With highest jobless rate, Spain rallies Spanish stock index performing surprisingly strong, but some stay away By Barbara Kollmeyer, MarketWatch MADRID (MarketWatch) -- Judging by the amount of road work clogging up Spain's capital city currently, with Madrid practically being unearthed, you'd be forgiven for thinking you were in the midst of a dynamic and growing economy. However, that's anything but the case. Public works programs have been going on across Spain under the government's so-called "PlanE" bid to stimulate the bleakest economy in Europe, where the jobless rate hit 18.5% in July and is expected to top 20% in...

Following the incredible popularity of my post “Is Nouriel Roubini a False Prophet?“, I’ve decided to do a little introductory lesson for those more interested in avoiding charlatans … Cold Reading is a primary set of techniques employed by phony psychics and market prognosticators. When cold reading, the primary objective of the sender is to ensure that the recipient perceives the statement/prophecy to be a hit. Here are a few classic techniques used by Ms. Cleo and Nouriel Roubini: TECHNIQUE 1. The “Rainbow Ruse”: Indicate one trait and, at times, the opposite. For example: “The bad news out of the...

I just wanted to add some color to my recent post regarding why the NYSE TRIN indicator might be broken. Reader Brian adds a very interesting perspective, indicating that he's watched TRIN and C side by side and has seen a very strong correlation. When C flips from up to down (or vice versa), there is a corresponding huge move in TRIN. This could only be the case if a stock like C comprised a large share of total NYSE volume, which indeed seems to be the case, as noted by The Big Picture blog. Above I took C, FNM,...

<p>ANNANDALE, Va. (MarketWatch) -- It's hardly earth-shattering news that the last six months have been a speculative period for the stock market.</p> <p>Nor is that a big surprise: The initial thrusts upward of a brand new bull market are always speculative.</p>

Stock futures signal sharp drop after Asia selloff On Monday August 17, 2009, 4:28 am EDT PARIS/LONDON (Reuters) - Stock index futures extended their losses early on Monday, mirroring a selloff in Asian and European stocks on mounting worries the equities' recent surge had run ahead of the global economic recovery. At 4:18 a.m. EDT, futures for the S&P 500 were down 1.92 percent, Dow Jones futures were down 2.11 percent and Nasdaq 100 futures were down 2.11 percent. Chinese stocks (^SSEC - News) sank 5.8 percent to their lowest close in two months on Monday on worries about added...

Placebo Effects: Part 1 By: Satyajit Das Mixed Metaphors… Botanical commentators are finding ‘green shoots’. The astronomically minded have seen ‘glimmers’. The meteorologically minded have spoken about the storms ‘abating’. Strong rallies in equity and debt markets have confirmed the recovery for the ‘true believers’. The Global Financial Crisis ("GFC") crisis is over! It is useful to remember Winston Churchill’s observation after the British expeditionary force’s escape from Dunkirk: "[Britain] must be very careful not to assign to this deliverance the attributes of a victory". There may be confusion between ‘stabilisation’ and ‘recovery’. The ‘green shoots’ theory is based on...

The newest jobs report is comming out at 8:30am today. The prediction is 275,000 more jobs lost.

Goldman positions itself in the middle of a speculative bubble, selling investments they know are crap. Then they hoover up vast sums from the middle and lower floors of society with the aid of a crippled and corrupt state that allows it to rewrite the rules in exchange for the relative pennies the bank throws at political patronage. Finally, when it all goes bust, leaving millions of ordinary citizens broke and starving, they begin the entire process over again, riding in to rescue us all by lending us back our own money at interest, selling themselves as men above greed,...

So we've got "green shoots" in the market eh? Very nice chart, this, right? img src=”http://market-ticker.denninger.net/uploads/Charts-2009-08/spx-1y.png>. Hmmm... how do you square that with the fact that earnings are dropping like a stone on a year-over-year basis, revenues (the more important indicator of economic activity) are down double-digits on average, and consumer purchasing power (as measured by tax receipts, down 22% at a federal level year over year, the worst since the Depression) is in the toilet? We're told this is "money was on the sidelines" and "people are rushing in." But the statistics say otherwise: Only $400 billion has shifted...