STOCK MARKET WATCH, Friday 16 December

Marty's Mailbag

The last week has been pretty busy at work and because of my company’s annual holiday dinner, my usual routine of drafting an article on Wednesday evening and finishing it up with “Today’s Market” after a quick dinner on Thursday was not possible. So this week, I thought I would share a recent holiday season E-mail and response, real time. I just received this e-mail from my uncle who my wife and I don’t see often enough:

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Dear Martin,

It was good seeing you and your family Sat. at your Mom's house. Diane & Linda are really, really nice - You are a lucky man. Hopefully we can get together again soon when Elyse is home on a school break. I am going to take you up on your offer to analyze a couple of stock buys that I am considering (KMP), (CX), (IDR). Take a look at them and let me know what you think.

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Dear Uncle Aaron...

As we discussed, you are looking for “investments” and as such, I’m assuming that you are interested in the long term. I cannot stress enough the amount of risk in today’s stock market, although it may seem to you and Auntie that there is no significant risk. I didn’t mean to be disrespectful when I laughed out loud when you mentioned your interests in a Chinese cement company and Teva, an Israeli pharmaceutical company. You may make some speculative gains in these stocks, but I truly believe that we outsiders don’t know enough about such sectors to consider these actual “investments.” I do know an old friend who manages a French-owned generic drug production company’s production facility. I can tell you that this is a low margin cut-throat business, and my friend is under a lot of stress with his commitment to his job, while he figures out how to put two sons through college and maintain a normal family life. These generic drug companies are not the money makers that you would be led to believe by watching business TV. If they were, you can bet that they would pay higher dividends. Remember how it was when I was little?

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Today’s Market

The market did very little today, with the most significant thing sticking in my head, the highest drop of the CPI in 50-years as I think I heard on Bloomberg radio. As they say in Phila., “Yea Right!!”

more...

http://www.financialsense.com/Market/wrapup.htm

Long before spreadsheets and BlackBerries, for example, economists and financiers were seeking clues to the coming economic weather in the yield curve. They still are.

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They're warning that the yield curve has grown flat - and that a flat yield curve often means an economic downturn is coming.

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The concept is fairly simple. Take a set of fixed-income securities, such as Treasury bills and bonds, with different maturity dates, and compare their current interest-rate yields.

A year ago, for example, you could purchase a six-month Treasury bill with an interest-rate yield equal to 2.47 percent per year. Two-year bonds yielded 2.96 percent; five-year, 3.51 percent; and 10-year, 4.12 percent.

more... could put a crimp in lending

http://www.philly.com/mld/inquirer/business/13401225.htm

With the Dec. 13 quarter-point rate increase by the Fed, we've reached a difficult and puzzling fork in the economic road. In one direction lies the ugly prospect of a housing bust, leading to a collapse in consumer spending and ultimately a recession. In the other direction is the much more appealing vision of continued solid growth -- a position that's reflected in the statement the Fed released today.

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FLATTER CURVE. It's a moment of what I call "fundamental uncertainty," where conventional economic forecasting simply breaks down. The numbers keep rolling in, but they offer few, if any, clues about what will happen next. For example, Manpower released its quarterly employment survey on Dec. 13, asking employers whether they plan to add or reduce workers in the first quarter of 2006. The result: Its "Net Employment Outlook" index is 20.

Is that good or bad news? Well, the index was at roughly the same level in 1998 and 1999, during the boom years of the 1990s. Most American workers wouldn't mind a repeat of those years. However, the Manpower index was also about 20 in early 1989, when a decent labor market very rapidly turned sluggish, setting the stage for the recession of 1990-91 (see BW Online, 11/29/05, "Is the Job Market Really 'Buoyant'?").

Other indicators are equally ambiguous. The yield curve is flattening out, so that the long-term rate on 10-year Treasury bonds, at 4.5%, isn't much higher than the new 4.25% fed funds rate. That sort of flat yield curve is often a sign of trouble ahead -- but not always.

more...

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Given all this uncertainty, the right advice these days might be to hope for the best, but plan for the worst.

:donut: Thanks for the lesson on yield curves. I have heard them mentioned and had a vague idea, but this cleared things up.
Bad news today. When Texas first took on the Katrina Evacuees- FEMA said they would reimburse the school districts 90% of the costs (we had to hire new teachers-from La of course-and open some schools that had been closed).
These kids required a lot of services (counseling, special ed services-that they were not fully receiving)esp tutoring to help them pass our testing as required by the No Child Left Behind. As of yesterday, the amount we have received from FEMA is the equivalent of ONE I repeat ONE day of educational costs for these kids. If this is not remedied soon, we will be laying off essential staff. At the last school board meeting, our comptroller announced that we had a AA+ bond rating. We are a well run school AND city. This foot dragging by the government is a looming train crash. Needless to say we are hopping mad. I am going to get the info and post because this is another example of the piss poor leadership we have in Washington. I mention this because this effects EVERY school district that took in a large number of kids. We will all be in the same boat soon.
If I am laid off (a possibility), I have skills and will quickly recover. But it is not fair to these kids and will set a bad example for other cities that take in future evacuees.
Happy Hunting, and watch out for the bears.

SINGAPORE - Oil prices fell Friday as traders shrugged off snowstorms and icy weather in the United States to lock in profits ahead of the weekend.

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Crude futures have posted losses in the past two days since the U.S. government reported increases in domestic crude stockpiles, raising expectations that U.S. fuel supplies will meet peak winter heating demand and prompting a sell-off.

The market also seemed unfazed by data showing U.S. stocks of distillate fuels, which include heating oil and diesel, slipped 100,000 barrels to 130.5 million barrels.

The declines in crude and heating oil prices came even as the U.S. Northeast, the world's largest market for that distillate, braced itself for a brutal snow and ice storm likely to increase demand for winter fuel.

more...

10:01am 12/16/05 JAN CRUDE FALLS 34C TO $59.65/BRL AFTER 1-WK LOW OF $59.56

10:01am 12/16/05 JAN NATURAL GAS FALLS 23.1C, OR 1.7%, TO $13.55/MLN BTUS

2:07pm 12/16/05 JAN CRUDE DROPS $1.41 TO $58.58/BRL AFTER 2-WK LOW OF $58.10

2:07pm 12/16/05 JAN NATURAL GAS DOWN 16.1C, OR 1.2%, AT $13.62/MLN BTUS

3:00pm 12/16/05 JAN HEATING OIL CLOSES AT $1.732/GAL, DOWN 3.1% FOR THE DAY

3:00pm 12/16/05 JAN HEATING OIL ENDS UNCHANGED FOR THE WEEK

3:00pm 12/16/05 JAN CRUDE CLOSES AT $58.06/BRL, DOWN $1.93, OR 3.2% ON DAY

3:00pm 12/16/05 JAN CRUDE ENDS THE WEEK WITH A LOSS OF $1.33/BRL, OR 2.2%

on that cocktail napkin? :evilgrin:

Dec. 16 (Bloomberg) -- The U.S. current-account deficit unexpectedly narrowed from July through September, as insurance payments and donations from abroad poured in following Hurricane Katrina, a government report showed.

The deficit, the broadest measure of trade because it includes transfer payments and income from investments, shrank to $195.8 billion last quarter from a revised $197.8 billion the previous three months, the Commerce Department said today in Washington. It was the second straight narrowing after a record $198.7 billion in the first three months of the year.

The deficit is still likely to widen because demand for imported goods is rising as the economy grows, economists said. The trade deficit unexpectedly increased to a record $68.9 billion in October, as imports of crude oil, autos and televisions rose, a government report earlier this week showed.

``The insurance payments are going to go away,'' said Jay Bryson, global economist at Wachovia Corp. in Charlotte, North Carolina. ``The outlook remains very bleak.''

more

http://quote.bloomberg.com/apps/news?pid=10000006&sid=azD6Ban1R1b4&refer=home

this article tends to leave that out unless you read between the lines.

The U.S. paid foreigners less income on their holdings of American assets than it received from U.S. investment abroad. That's helped to restrain the deficit.

Foreign Earnings

Foreign earnings on U.S. assets, including wages and other compensation, rose to $118.2 billion in the third quarter from $112.7 billion in the previous three months. Income on overseas assets held by U.S. investors rose to $118.7 billion from $111.1 billion. That left a $512 million surplus on income payments, compared with a $1.5 billion deficit in the second quarter.

There's a lot of bucks leaving our shores for investments overseas, there have been several articles on that posted here in the past.


Then you gotta ask, how many of these "foreign investors" Greenspin lauds are hedge funds based in the Caribbean?

Greenspan

The U.S. has been able to support a record current-account deficit in part because individuals, companies and governments are more willing to invest their money outside of their home markets, Greenspan said Nov. 14 in a speech to the Banco de Mexico.


:eyes: Uhhh - yeah, right. With that line in mind, read the last 4 paragraphs of that article :scared: :hurts:

http://quotes.ino.com/chart/?s=NYBOT_DXY0

Last trade 89.96 Change -0.06 (-0.07%)

Dollar Woes Continue

http://www.dailyfx.com/story/dailyfx_reports/daily_technicals/5538_dollar_woes.html

EUR/USD – Euro continued to revolve around the psychologically important 1.2000 handle, as the price action stalled around the 38.2 Fib of the 1.2588-1.1639 USD rally. A further move to the upside will most likely see the pair head higher and test the dollar offers around 1.2116, a level marked by the 50.0 Fib of the 1.2588-1.1639 USD rally, breaking of which might see the pair stall around the 1.2100-1.2200 range as the pair rejected the price below the 1.2227, a level established by the 61.8 Fib of the 1.2588-1.1639 USD rally during the October trading range. However in case the Euro traders fail to keep the pair above the 1.2000 handle, that would signal weakness, which would give the dollar bulls a chance to launch a countermove. Indicators are mixed with positive momentum above the zero line and negative MACD sloping upward toward the zero line, while neutral oscillators give either side enough room to maneuver.

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USD/JPY – Japanese Yen traders saw the momentum of their advance stall around the 116.00 handle after the pair managed to post significant gains against the dollar. As yen bulls consolidate their gains and lift the selling pressure, thus giving the greenback bulls a chance to retrace some of the yen’s rally. As greenback longs retrace part of the move, the next move to the upside will most likely see the pair head higher and test the offers around 117.37, a level established by the 23.6 Fib of the 104.16-141.46 USD rally, which is further reinforced by the 50-day SMA at 117.64. A subsequent reversal will most likely see the pair head lower and test the recent support around 115.60, a top of the October consolidation zone, with a break below targeting the psychologically important 115.00 handle which is defended by the 38.2 Fib of the 104.16-121.44 JPY rally, at 114.85. Indicators are diverging with negative momentum indicator below the zero line while positive MACD is sloping downward toward the zero line, with ADX above 25 at 35.73, signaling an existence of a maturing trend, not a direction of one, while neutral oscillators give either side enough room to maneuver.

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posted wrong place

http://www.gold-eagle.com/editorials_05/willie121405.html

The USDollar is next to be subjected to a double-barrel assault, call it a shotgun. The first barrel lies in the financial sector. The interest rate advantage gradually fades, as the Euro Central Bank has begun its tightening cycle. Despite language antics and American-style games, FOREX experts anticipate numerous ECB rate hikes from their base at 2.0% toward at least 3.0% eventually. Meanwhile, the US Federal Reserve is likely to end its tightening cycle of the Fed Funds target before the ECB has completed its own rate increases on their standard rate. The primary driver behind bond arbitrage, higher US rates on short-term yields, has been neutralized and soon might reverse. The rate differential might narrow sometime in 2006, maybe even in 1H2006. Given how the financial tail wags the American dog, this rate shift is sure to have a marked effect on the USDollar.

The second barrel lies in the real economy, the foundation to the entire system. The October trade deficit exploded to a record $68.9 billion, with a slightly higher oil bill to foreign producers and a slightly lower crude oil price. Gulf of Mexico oil production has yet to be fully restored. The Chinese bilateral trade gap expanded to a record $20.5 billion. Capital flows are important. Large companies doing business in the import-export trade buy and sell large quantities of currencys in preliminary fashion to the closure of large deals. The hemorrhage in capital from the United States to Asia (for finished products) and to the Persian Gulf (for crude oil) is sure to have a continued marked effect on the USDollar. Recall the Austrian tenet, that financials revert to the fundamental theme, and core statistics for the United States are nothing short of resembling a Third World nation.

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The USFed raised its Fed Funds target rate to 4.25% this week. The heretical belief seems unflinching, that economic growth with near full unemployment spawns price inflation. Little attention seems to prevail among economists that our credit growth is the well-spring of price inflation. An extension of the Non Accelerating Inflation Rate of Unemployment (NAIRU) and Phillips Curve nonsense prevails. We have neither strong growth nor a low jobless rate, but rather a powerful propaganda machine which purports each phony story. No clear comprehension exists that rising prices have occurred on the cost side but not on the wage side of the equation. In its language, the USFed repeated an expectation it would likely need to push rates up further to keep inflation at bay, suggesting at least one more quarter point hike ahead. "The committee judges that some further measured policy firming is likely to be needed to keep the risks to the attainment of both sustainable economic growth and price stability roughly in balance."

The unfortunate rub for US monetary officials is the flattened yield curve, registered now at under 10 basis points on the spread between the 2-yr yield and 10-yr yield, (4.39% versus 4.46%). See the Treasury yield curve chart. These lousy economists have taken the time-tested reliable indicator to the edge of flashing "recession." Generally speaking,

US economists are the worst in the world, having become market apologists, government salesmen, brokerage whores, corporate promoters, and academic teachers of heresy.

An entire generation of badly educated economists is running our national financial system, endorsing the heretical policies, and defending policies made within that system.

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US ECONOMISTS ARE THE WORST IN THE WORLD, HAVING BECOME MARKET APOLOGISTS, GOVERNMENT SALESMEN, BROKERAGE WHORES, CORPORATE PROMOTERS, AND ACADEMIC TEACHERS OF HERESY. That warning should be etched in your mirror, like the warning, objects may be closer than they appear. I am writing in my fav econo book now. Most suscenct advice I have heard in a while.

http://www.prudentbear.com/internationalperspective.asp

The U.S. dollar, which has staged a counter-trend rally all year, looks like it is finally poised to resume its historic decline. Although the dollar actually weakened this year against several secondary currencies, the headlines have focused principally on its 2005 gains against its two principal rivals, the euro and the yen. However, recent reversals and technical action in both currencies strongly suggests the rally has finally exhausted itself.



Earlier this year it also appeared that the dollar’s bear market rally had come to an end. However, much like a drowning man, the dollar managed to make one more lunge upwards, marginally exceeding its July peak. That head fake was a classic sucker’s rally, as it emboldened dollar bulls, and caused tepid dollar bears to throw in the towel. Speculators, now overwhelming long the dollar, will likely add to the dollar’s woes, as they rush to cut losses on losing positions, or preserve rapidly fading profits.



The problem for those betting on dollar strength is that despite its year long rally, the fundamentals have actually deteriorated substantially. Nothing illustrates that fact better than Wednesday’s release of October’s record 68.9 billion dollar trade deficit, and Thursday’s report that Americans hocked a record 108.6 billion dollars worth of stocks and bonds to foreign investors in order to finance it. America’s unprecedented consumption binge and net accumulation of external liabilities evidences twin economic failures of historic proportions.



The unfortunate reality is that as bad as October’s record setting economic failures were, they will likely be exceeded in the months ahead. In order for America’s bubble economy to continue expanding, Americans must continue spending. However, the two key elements required to achieve this, consumer goods and the means to pay for them, are both lacking. Therefore any further expansion requires Americans to import greater quantities of the former and go even deeper into debt to finance the latter.

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a couple of weeks ago which (paraphrased) said that after we (the US) had put the women into the workforce and extracted the equity from our houses, basically that there was nowhere else to turn for additional spending power.

I think that we need to rethink that a bit, don't you? After all, we can do away with those pesky child labor laws and start putting our kids to work! They can be the next wave of money for additional consumption spending! :sarcasm:

there is alot of pent up consumer demand esp for power tools, cutlery, clothing, arms, and automobiles :sarcasm:

Dow 10,911.45 +29.78 (+0.27%)
Nasdaq 2,272.70 +12.07 (+0.53%)
S&P 500 1,272.52 +1.58 (+0.12%)
10-Yr Bond 4.427 -0.41 (-0.92%)

NYSE Volume 486,710,000
Nasdaq Volume 593,680,000

9:15AM: S&P futures vs fair value: +5.0. Nasdaq futures vs fair value: +4.0.

9:00AM: S&P futures vs fair value: +4.8. Nasdaq futures vs fair value: +3.5. Still shaping up to be a higher start for the cash market as strong earnings reports from Adobe Systems (ADBE), KB Home (KBH) and Darden Restaurants (DRI) last night also act as early sources of buying support. While Oracle's (ORCL) in-line Q2 report has drawn mixed reaction, a Merrill Lynch upgrade has helped offset over-night weakness in ORCL shares. It is also worth noting that total volumes should be above average today amid quarterly options expiration (quadruple witching), which could also invite increased volatility.

8:33AM: S&P futures vs fair value: +4.5. Nasdaq futures vs fair value: +3.5. Futures indications are off their best levels but still trade above fair value, setting the stage for stocks to resume their fourth-quarter rally. Separately, the latest report on the current (Q3) account balance just checked in at -$195.8 bln (consensus -$205.0 bln), but since a large deficit was widely anticipated, it has so far had little impact on pre-market action. Bonds have also shrugged off the data as the 10-yr note is still up 6 ticks to yield 4.43%.

8:00AM: S&P futures vs fair value: +4.0. Nasdaq futures vs fair value: +4.0. Futures market versus fair value suggest that the major averages will open higher. Helping set the upbeat tone early on have been reports of a potential leveraged buyout of grocer Albertson's (ABS) chain and positive comments from GM's CEO regarding revenue upside for FY06. Further deterioration in energy prices heading into the weekend also bodes well for the bulls.

http://www.fxstreet.com/nou/noticies/afx/noticia.asp?pv_noticia=1134679448-f05e0f08-46511

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In a speech at the New America Foundation, a Washington think tank, outgoing CBO Director Douglas Holtz-Eakin said the future burdens posed by federal entitlement programs are such that even in a world without hurricane relief, ongoing war spending, budget pork and the extension of recent tax cuts, "our country would face deficits as far as the eye can see and enormous fiscal challenges." In only one scenario in the report, in which federal spending grows much slower than average and revenues grow much faster than average, does the federal budget post a long-term budget surplus

But that scenario assumes bracket creep, in which real income growth pushes taxpayers into higher tax brackets, and the alternative minimum tax would combine to cause revenues to continually rise until they reach 23.7% of GDP in 2050, well above the range of 16.1% to 20.9% seen since 1951. It also assumes a reduction in spending that's unlikely unless there are significant changes in health policy, the report said

The worst-case scenario sees federal debt equal to 130% of GDP by 2030, growing steadily after that, the report said, noting that the forecast doesn't take into account the harmful effect long-term deficits would have on economic growth

Holtz-Eakin dismissed notions that future economic growth would be sufficient to close the long-term fiscal gap

"You can't grow your way out of this problem. It's just too big," Holtz-Eakin said

but where were these *wads when this started. I didn't hear ANY of these people screaming when the deficit started rearing it's ugly head. Six years ago we had a surplus, UNDER A DEMOCRAT, and look where we are today. These same *wads were telling us then that we could grow our way out. I may have a few grey hairs...but my memory is sharp!
Now that they have their boats filled with cash that they took from us and their life jackets are on, they are abandoning the ship. What a bunch of sorry asses.

and they just ignored charts like this one:

thanks for the graph of hope. I feel a bit better now.

http://seattlepi.nwsource.com/business/252285_adobe16.html

Fremont hit by layoffs; 300 to be hired in India

Adobe Systems Inc. posted higher fourth-quarter earnings Thursday but said it expects to cut 650 to 700 jobs as it folds recently acquired rival Macromedia Inc. into its operations.

As part of those cuts, Adobe last week cut an undetermined number of people at its Fremont campus, which employs roughly 500 people.

The layoffs came even as Adobe announced plans to hire 300 workers during 2006 at R&D facilities in Noida and Bangalore, India.

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"I knew they'd be doing something because of the merger, but I felt fairly confident it wouldn't happen in my department, because there was no overlap with Macromedia," the second worker said.

"I am very disappointed, and I was shocked by the seniority of some of the others who were let go."

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election reform. A prime example of the lobbying industry at the top of its game, why would anyone want to mess with it?. :sarcasm:

http://www.nytimes.com/books/98/06/21/specials/barth-sot.html

In the 1960 novel, a person's guilt or innocence in colonial America is determined by the sot-weed factor. Sot-weed is tobacco. The side that offered the judge the most bales of sot-weed won the case. It's the same thing in Illinois. It's interesting that the case involves sot-weed and a sot-weed company.

1:42pm 12/16/05 FEB GOLD CLOSES AT $505.90/OZ, DOWN 70C FOR THE DAY

1:42pm 12/16/05 FEB GOLD LOSES $23.40/OZ, OR 4.6%, FOR THE WEEK

http://www.kitco.com/weekly/paulvaneeden/dec162005.html

The US trade deficit increased to $68.9 billion in October with China's net exports to the US at $20.5 billion for the month. This year's annualized deficit with China is now the largest ever recorded in the history of the US. It is almost twice as large as the deficit with Europe and almost three times as large as the deficit with Japan.

Earlier this year, before I started harping on the impact a downturn in the real estate market would have on the US economy, I said that the dollar would weaken when either China or Japan decided to stop supporting it by keeping their trade dollar reserves off the foreign exchange market. I also discussed how China and Japan could use their foreign reserves to stimulate their own economies once the marginal benefit of supporting the US dollar has diminished. Well, there was an interesting article in a Chinese newspaper, called The Standard, on Tuesday. The newspaper quoted Mr. Yu Yongding, who is a member of the monetary policy advisory committee to the People's Bank of China, as saying that China should weaken the link between the yuan (renminbi) and the US dollar, to make the exchange rate more flexible and improve the government's ability to manage the economy. Yu suggested that the weighting of the US dollar in the basket of currencies against which the renminbi is set should be reduced, reducing the impact that changes in the US dollar would have on the value of the renminbi. The market read this as a prelude to China allowing the dollar to weaken and its own currency to strengthen.

On Wednesday Mr. Yu Yongding was quoted by the same newspaper as saying that Chinese firms should get ready for a strengthening of the yuan (renminbi) in the next one to two years. The "fuller the preparations, the better," he said. He went on to say that China's current account surplus and America's current account deficit are reflections of savings and investment imbalances in the two countries. He also said that the dollar would probably weaken unless the United States tackles its current account deficit.

The same article mentions a research paper obtained by Reuters, wherein Mr. Yu Yongding suggested China could reduce the growth in its foreign reserves by running expansionary fiscal policies and invest in infrastructure and research and development.

more...

http://www.forbes.com/business/feeds/afx/2005/12/15/afx2393646.html

BEIJING (AFX) - China will leapfrog Italy, France, and Britain to be officially recognized as the world's fourth-biggest economy if it revises its 2004 gross domestic product up by 300 bln usd on Dec 20 as expected, Standard Chartered economist Stephen Green said.

In a research note, Green said the additional output will also drastically improve measures of the the Asian powerhouse's economic health.

'As if China's economy was not growing fast enough, thanks to a statistical revision, growth in 2005 looks like being about 30 pct,' Green said.

'The recent national economic survey has apparently found another 2.4 trln yuan worth of output,' Green said.

more...

I was looking for that article to post yesterday. Heard it on NPR on the way in. Funny how money could be lost. Some parts of China are so isolated and rural, that they are just NOW getting the banking system set up there. Only in China could you lose 2.4 trln yuan. I can picture the gov going house to house checking the matresses on the farms.

GM to see improved revenue in 2006: CEO

http://today.reuters.com/PrinterFriendlyPopup.aspx?type=businessNews&storyID=uri:2005-12-16T135830Z_01_ARM603246_RTRUKOC_0_US-AUTOS-GM.xml

STERLING HEIGHTS, Michigan (Reuters) - General Motors Corp. <GM.N> should see improved revenue in 2006, driven by its new line of full-sized sport utility vehicles and trucks, Chief Executive Rick Wagoner said on Thursday.

"We are going to have a nice start to the year as we build and ship the new Chevy Tahoe, and that should help on the revenue side," Wagoner said, speaking on the sidelines of GM's holiday party in Sterling Heights, Michigan.

Wagoner declined to say when the automaker might return to profitability, but said he was optimistic about the soon to be launched GMT-900 series - a line of redesigned SUVs with better fuel-efficiency.

The GMT-900 series, hailed by analysts as critical to the future of GM, includes Chevy Suburbans, Tahoes and GMC Yukons. Some analysts have called the line the "make-or-break" series for the automaker.

The world's largest automaker has lost nearly $4 billion this year as it struggles with high labor and commodities costs, loss of U.S. market share to foreign rivals and slumping sales of its SUVs - longtime cash generators for the auto giant.

...more...

One word: Delusional

http://www.latimes.com/business/la-fi-briefs16.6dec16,1,6761642.story?coll=la-headlines-business

General Motors Corp. will suspend contributions to 401(k) retirement savings plans for its U.S. salaried workers as part of efforts to trim $7 billion from annual costs.

The 36,000 employees were told Wednesday that the contributions would end Jan. 1. The company said it would "monitor the business outlook" to decide on when to resume the benefit. GM has paid 20 cents into the plans for every dollar employees put in, after reducing the company amount from 50 cents in April.

Crossover vehicles offer alternative; GM plant shutdown sign of times

http://www.msnbc.msn.com/id/10437091/

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Loved for their size and power, yet reviled as a symbol of America’s gas-guzzling car culture, SUVs have become almost as much an icon of American excess as McMansions or bulging waistlines. Sales surged in the late 1990s, but the explosive growth drew a raft of criticism over the risk they bring to other motorists and their extremely low fuel-efficiency and therefore potential damage to the environment.

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At GM, the company is hoping to halt the sales slide with a new lineup of full-size SUVs, due for release in 2006. GM says its 2007 Chevrolet Tahoe, Cadillac Escalade and other models that will be released next year get 20 miles to the gallon in highway driving, making them the most fuel efficient in their class.

Some analysts think GM’s outlook is optimistic, and many don’t think demand for large SUVs is likely to return to the peak levels of 2004, when 4.5 million SUVs were sold, representing about 26 percent of overall vehicle sales, according to market information firm J.D. Power and Associates.

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Ford, for example, plans to launch two new CUV models at the Detroit Auto Show in January, notes research firm Global Insight in a recent report. Ford needs the new CUV models, which will go on sale in September as 2007 models, to expand its share in the fast-growing CUV category, and also to offset its overall U.S. market share decline, especially in the SUV segment, the study said.

“Even with rising petrol prices, U.S. consumers, who have grown accustomed to the styling, seating height and performance of SUVs, are not willing to sacrifice these characteristics to return to passenger cars, and CUVs provide an attractive alternative to people seeking an SUV-like vehicle with better fuel economy,” the report from Global Insight said.

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<snip>“Even with rising petrol prices, U.S. consumers, who have grown accustomed to the styling, seating height and performance of SUVs, are not willing to sacrifice these characteristics to return to passenger cars, and CUVs provide an attractive alternative to people seeking an SUV-like vehicle with better fuel economy,” the report from Global Insight said.

this time.

Decades of learning how to push our buttons have led to marketing entities that are pretty damned good at psy-ops. We've become a nation good little complacent consumers. They've mastered the art of propaganda to convince us of what we need, want, desire, feel, crave, vaule, find validation in, etc, etc.

like Fred Flintstone drove-hey they had NO gas back then (except maybe after eating Betty's cooking). YABBA DABBA DO

http://quote.bloomberg.com/apps/news?pid=10000039&refer=columnist_mysak&sid=atbH86o8UCQs

Dec. 16 (Bloomberg) -- If you want to worry about your municipality's finances, worry that your local officials don't quite know what they're doing.

Don't blame them entirely. The municipal market has become a complicated and scary place over the past decade, what with all the swaps and options and derivative products Wall Street so wants to sell Main Street.

Consider the Securities and Exchange Commission's recent action against Pennsylvania bond lawyer Ira Weiss. The SEC says that Weiss was negligent for not informing his client, the Neshannock Township, Pennsylvania, School District, about why it couldn't sell a three-year note issue, invest the proceeds, and keep the profits, and that it instead had to adhere to a fairly strict timetable to spend the money.

The SEC also says that Weiss committed fraud by certifying the district's notes as tax-exempt, and that the proceeds would be used for renovation and construction. The SEC took its action earlier this month. Weiss is appealing.

The SEC's opinion provides a rare look at how public finance works among unsophisticated issuers -- that is most of them.

more...

http://today.reuters.com/investing/financeArticle.aspx?type=fundsNews2&storyID=URI:urn:newsml:reuters.com:20051216:MTFH14197_2005-12-16_15-03-30_N16112079:1

NEW YORK, Dec 16 (Reuters) - Goldman Sachs Group Inc. (GS.N: Quote, Profile, Research), which posted its second straight year of record profit Thursday, paid Chief Executive Henry "Hank" Paulson about $38 million in salary, restricted stock and options.

According to a U.S. Securities and Exchange Commission filing, Goldman on Tuesday gave Paulson 224,777 restricted stock shares worth about $30 million when priced last month. Of these shares, 89,910 vested immediately and were withheld by the firm to cover Paulson's tax obligations while the remaining 134,867 shares vest in November 2008.

Paulson, who is 59, was also granted stock options on 220,392 shares valued by the firm at about $7.3 million, with 40 percent vesting immediately. Paulson, who received a salary of $600,000 and no cash bonus this year, now holds 3.89 million shares.

Overall, Paulson's compensation rose more than 21 percent from last year.

<snip>

The firm's top five officers -- Paulson, President Lloyd Blankfein, Chief Financial Officer David Viniar and Vice Chairmen Robert Kaplan and Suzanne Johnson -- combined received $80.3 million in stock and options, up 19 percent from last year.

...more...

Whew! I was sooooo worried that these people might not get their BIG bonuses! :sarcasm:

Just when we thought we'd seen it all -- $241,000 at a strip club?


http://money.cnn.com/2005/12/15/news/newsmakers/ceos_fortune_121205/index.htm (open the "few of the highlights" link)

snip>

Too Sexy for His Staff
American Apparel CEO Dov Charney was named in two sexual harassment suits in May. Among the allegations: that Charney conducted job interviews in his underwear and gave employees vibrators. Charney denied the charges. He told a reporter, "I don't think I go over the line. Sexuality and sexual words become part of the daily banter of work life in any free society."

snip>

Private Property
His ouster from AIG was so abrupt that former CEO Maurice "Hank" Greenberg left without his personal effects. After weeks of negotiations, the company finally let him retrieve, among other things, the health records of his pet Maltese, Snowball, his monogrammed towels -- and some unspecified "underwear."

snip>

A Night to Forget
American Express filed suit against Savvis Inc. and its CEO, Robert McCormick, in October for failing to pay McCormick's $241,000 one-night tab at Manhattan topless club Scores. AmEx claims McCormick said he rang up only $20,000 in charges (and blamed the rest on fraud), but Scores provided AmEx with signed receipts for the full sum. Savvis placed the CEO on unpaid leave in October.

http://news.yahoo.com/s/ft/20051216/bs_ft/fto121620050500450918;_ylt=Ah0lNKnVwBnVfA4wdCl15xL2ULEF;_ylu=X3oDMTBiMW04NW9mBHNlYwMlJVRPUCUl

snip>

In the latest Financial Stability Review, the Bank repeats concerns that the availability of cheap debt for private equity buyouts and the continued flow of money into hedge funds show that some financial players may be underestimating the risks they are facing.

The Bank's decision to repeat its warning reflects a growing concern among regulators and central bankers about the effects on the financial system of an unprecedented period of macroeconomic stability and low long-term interest rates, which have helped to fuel a global surge in liquidity.

"The continued 'search for yield' could be leading some investors to underestimate risk, particularly if they focus on the absolute level of yields in an environment where long-term interest rates are low," the Bank says. "And some investors might harbour overly optimistic views about the capability of policymakers tooffset shocks to the macro-economy."

The Financial Stability Review, a twice-yearly asses-sment of the risks to the financial system, is designed to point out regulators' worries. In a speech last month Sir Andrew Large, the Bank's outgoing deputy governor, argued that regulators round the world should review liquidity standards to make them better equipped to handle any shocks.

more...

Our country is filled with propaganda - and I will remain certain that there are many "surprised economists" that receive payola.

http://www.businessweek.com/bwdaily/dnflash/dec2005/nf20051216_1037_db016.htm

A columnist from a libertarian think tank admits accepting payments to promote an indicted lobbyist's clients. Will more examples follow?


A senior fellow at the Cato Institute resigned from the libertarian think tank on Dec. 15 after admitting that he had accepted payments from indicted Washington lobbyist Jack Abramoff for writing op-ed articles favorable to the positions of some of Abramoff's clients. Doug Bandow, who writes a syndicated column for Copley News Service, told BusinessWeek Online that he had accepted money from Abramoff for writing between 12 and 24 articles over a period of years, beginning in the mid '90s.

"It was a lapse of judgment on my part, and I take full responsibility for it," Bandow said from a California hospital, where he's recovering from recent knee surgery.

After receiving BusinessWeek Online's inquiries about the possibility of payments, Cato Communications Director Jamie Dettmer said the think-tank determined that Bandow "engaged in what we consider to be inappropriate behavior and he considers to be a lapse in judgment" and accepted his resignation. "Cato has an excellent reputation for integrity, and we're zealous in guarding that," Dettmer said.

Bandow has written more than 150 editorials and columns over the past five years, each identifying his Cato affiliation. His syndicated column for Copley News Service is featured in several hundred newspapers across the country. Bandow's biography on the Cato Institute Web site says he has also appeared as a commentator on all the major television broadcast networks and the cable news channels.

MULTIPLE TRAVAILS. A former Abramoff associate says Bandow and at least one other think-tank expert were typically paid $2,000 per column to address specific topics of interest to Abramoff's clients. Bandow's standing as a columnist and think-tank analyst provided a seemingly independent validation of the arguments the Abramoff team were using to try to sway Congressional action.

...more...

Dow 10,920.97 +39.30 (+0.36%)
Nasdaq 2,256.44 -4.19 (-0.19%)
S&P 500 1,273.44 +2.50 (+0.20%)
10-Yr Bond 44.37 -0.31 (-0.69%)
NYSE Volume 806,549,000
Nasdaq Volume 850,888,000

10:00AM: Major averages now trade in split fashion as the Nasdaq turns negative. Weighing most heavily on the tech-heavy Composite has been a 3.4% decline in Oracle (ORCL 12.40 -0.43). While a Merrill Lynch upgrade on ORCL initially helped offset over-night weakness in the stock, investors have been unable to overlook the fact that Q2 profits fell 2.1% and revenues were a bit lighter than expected. NYSE Adv/Dec 1620/649, Nasdaq Adv/Dec 1406/968

CIT to Restate Due to Hedge Accounting
The lender has terminated its compound derivatives and replaced them each with a pair of stand-alone swaps.

http://www.cfo.com/article.cfm/5324000/c_5324346?f=home_todayinfinance

CIT Group Inc. disclosed that it will restate its 2005 financials after learning that it did not qualify for hedge accounting.

The commercial and consumer lender — which uses compound derivatives to hedge interest rates and currency-exchange rates related to its debt financing — stated that during the fourth quarter, it learned of a different interpretation under FAS 133, Accounting for Derivative Instruments and Hedging Activities.

CIT, whose market cap exceeds $10 billion, stated that the revisions would boost earnings per share for the first quarter by 8.2 percent and for the second quarter by 12.6 percent, and would lower third-quarter earnings per share by 3.8 percent.

In the fourth quarter, the company terminated its compound derivatives and replaced them each with a pair of stand-alone swaps — a cross-currency swap and an interest-rate swap — that achieve the same economics as the original derivatives and that qualify as hedges under FAS 133.

http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=2005-12-16T154553Z_01_N16215950_RTRIDST_0_ECONOMY-ECRI-WEEKLY-UPATE-1.XML

NEW YORK, Dec 16 (Reuters) - A gauge of future U.S. economic growth edged down in the latest week as mortgage applications fell and interest rates rose, a report said on Friday.

The Economic Cycle Research Institute, an independent forecasting group in New York, said its weekly leading index slipped to 135.4 in the week ended Dec. 9 from a revised 135.5 in the prior week, previously estimated at 135.7.

The annualized growth rate of the index was 1.4 percent in the latest week, compared to a revised 1.6 percent in the prior week, previously reported at 1.8 percent.

<snip>

"Basically the index has been easing off since last summer," Banerji said. "The obvious conclusion here is that U.S. economic growth will follow suit -- but nothing dramatic."

...more at link...

I wonder how much Banerji was paid to add the "nothing dramatic" to his comments? :eyes:

Dow 10,920.97 +39.30 (+0.36%)
Nasdaq 2,259.96 -0.67 (-0.03%)
S&P 500 1,272.90 +1.96 (+0.15%)
10-Yr Bond 44.33 -0.35 (-0.78%)
NYSE Volume 1,067,770,000
Nasdaq Volume 1,058,676,000

11:00AM: Little changed since the last update as the Dow and Nasdaq continue to trade in opposing directions. With regard to the latter, it is worth noting that volume on the Composite has nearly surpassed 1.0 bln shares already due largely to quarterly options expiration. Known as "quadruple witching," such options-related activity, coupled with some Nasdaq 100 rebalancing, has perhaps also been responsible for the Nasdaq's underperformance this morning. NYSE Adv/Dec 1771/1240, Nasdaq Adv/Dec 1285/1421

http://www.321gold.com/editorials/merk/merk121605.html

What are the lessons from the Great Depression, from stagflation in the 1970s, from deflation in Japan? The bubbles that preceded these challenging times should never have been allowed to happen. Yet even today, the Federal Reserve Bank (Fed) is very reluctant to pop bubbles. Greenspan talked about irrational exuberance in the stock markets, but let the stock market rise to the stratosphere in the late '90s; he has also kept interest rates low for an extended period despite mounting consumer debt and steep home price appreciation.

Central banks allow excessive credit expansion to take place. Partially this may be because central bankers do not recognize a bubble until they are reasonably well developed. Partially this may be out of fear of political repercussions if central bankers were to openly target perceived bubbles in their infancy. To a great extent it is also because some central bankers believe they can mitigate the fallout from the bursting of a bubble.

Richard Koo, author of 'The Balance Sheet Recession', says massive government spending must take the place of corporate spending to keep an economy afloat when corporations do not invest and consumers do not spend. Koo considers himself to be a leading voice for the 'Japanese experiment'. He argues that corporations that come out of a bubble with massive debt are more interested in repairing their balance sheets, i.e. pay down debt, than to invest. He rejects the notion that such companies should be allowed to fail when the problem is systemic such that 95% of banks have a negative net worth and there would not be any buyers in the ensuing shakeout. Consequently, the economy would potentially suffer a meltdown. He has supported the use of public funds to keep the Japanese economy afloat and has encouraged a gradual and cautious disposal of non-performing loans (NPLs) for banks. Theoretically, government spending should be curtailed once the economy is self-sustaining again. We are skeptical that this will succeed, as once the government has authorized spending projects, they take on a life of their own. As a result, we are growing increasingly concerned about the yen as the Japanese economy shows signs of strength.

Policy makers have a choice to bring an economy to its knees to eradicate any excess; or to provide the appropriate stimulus to try to neutralize just about any potential crisis. Ben Bernanke during his confirmation hearing to succeed Greenspan as head of the Fed, emphasized the experience of the Fed governors will help to preserve prosperity. It goes without saying that inducing a depression by choice is something few central bankers are willing to make. When a central bank takes a more active role in promoting structural change before a bubble has evolved, such as the European Central Bank (ECB) has done over the past couple of years, critics are abundant. Europe experienced hyperinflation twice in the 20th century and is more concerned about the fallout of excess credit than, for example, the Fed or the Bank of Japan.

Bernanke says that "to understand the Great Depression is the Holy Grail of macro-economics." Fed policy makers have also been observing the Japanese experiment very closely. During his nomination hearing to succeed Fed chairman Greenspan, Bernanke praised the depth of experience of the Fed governors. He also said he saw the role of the Fed to provide adequate liquidity during a financial crisis. All of this suggests that when we face a crisis, the Fed under Bernanke's leadership will seek to rectify any imbalance with a stimulus.

more...

What is in the water today. I think we are all a bit cantankerous today (well, more so than usual). Loved the toons and posts.

Heading to the doc in a little bit here. I think I have walking pneumonia, but I'm not a doctor, hence today's trip to the clinic.
I'm sick and tired of being sick and tired.

yesterday I could sense fluid in my lungs too. More coughing and hacking. And now we are getting nasty weather to boot. Plus, all of this nastiness about FEMA is just the icing on the cake. No good deed goes unpunished.

it that anymore. What's in a name? New marketing for an old disease I guess. :shrug:

Need to head to the pharmacy to get my scripts. It's in the opposite direction as the clinic so figured I stop home first and see if hubby wants to go along for the ride. That's one of the "advantages" of living in bum-f*ck USA - everything is a half-hour commute. Hey, it's where we grew up, so it's home.

my usual symptom, but I am suspicious. I think you gave it to me 54....wash your hands before you type ;)

http://www.thetrumpet.com/index.php?page=article&id=1887

snip>

One of the not-so-obvious but enormously negative consequences of Mr. Greenspan’s economic policy has been the continual erosion of the dollar’s value. His guiding principle of managed low inflation, not zero inflation, is one factor that has led to the colossal loss in purchasing power of the dollar. According to Barron’s, “the damage to the dollar’s purchasing power … came not in the onslaught of historically high inflation during the 1970s, but in the continuous drip-drip of compounding some inflation every year” (Oct. 24, 2005).

Exacerbating the weak-dollar problem is the massive 334percent increase in the supply of money that has occurred over Mr. Greenspan’s18 years. As the supply of dollars has grown beyond demand, its value has fallen.

There are three other major problems with the economy that Ben Bernanke will have to confront.

First, federal government debt has been skyrocketing. Last October it reached a record $8 trillion, more than triple the $2.3 trillion the U.S. owed in August 1987. Just since June 2002, the national debt has increased by a third.

Frighteningly, the percentage of U.S. Treasury securities now owned by foreigners has also increased from 17 to 50 percent since 1987.

Second, Americans no longer save money. When Mr. Greenspan took office, the personal savings rate was a comparatively healthy 7.5 percent. From June to September, the personal savings rate was actually negative.

For four months, Americans spent more than they earned by borrowing on credit cards or home equity, selling investments (stocks, bonds and other assets), or by using savings from previous months. A lack of savings does not bode well for future economic growth, since savings fuels investment and a nation’s subsequent growth.

Third, the easy-money policy has helped create multiple bubbles and an economy more and more dependent on rising asset values to fund spending. In the late 1990s, people counted on the technology-stock mania to fund their retirement. Today it is the refinancing and home-equity-line-of-credit boom that is inflating the bubble.

Right now the markets believe the economy is as healthy as Mr. Greenspan says it is. Greenspan has the markets’ confidence. But the question is, will Bernanke be as successful?

more single sentence paragraphs...

Dow 10,915.05 +33.38 (+0.31%)
Nasdaq 2,258.82 -1.81 (-0.08%)
S&P 500 1,272.51 +1.57 (+0.12%)
10-Yr Bond 4.431 -0.37 (-0.83%)

NYSE Volume 1,266,619,000
Nasdaq Volume 1,193,365,000

12:00PM : The major averages remain mixed midday, as the blue chip indices benefit from upbeat news on the corporate front, plunging oil prices and falling bond yields while a mediocre Q2 report from Oracle (ORCL 12.23 -0.60) and quadruple witching options volatility weigh on the Nasdaq. To wit, total volume on the NYSE and Nasdaq - having already surpassed 1.0 bln shares due to options expiration and some index rebalancing - has provided some encouraging conviction behind the market's broad-based advance on the heels of yesterday's gridlocked session. Reports of a potential leveraged buyout of grocer Albertson's (ABS 24.45 +0.46), coupled with renewed optimism regarding corporate profits and a 2.2% slide in the price of crude, have been the biggest sources of early support. Of the six economic sectors trading higher, Utilities have paced the way higher while the rate-sensitive Financial sector, also benefiting from strength in Treasuries, has been the biggest source of blue chip support. The 10-yr note is up 8 ticks to yield 4.42%. The absence of leadership in Energy and Technology, however, has prevented the market from turning an even better performance. Consumer Discretionary has been in focus all morning, but RadioShack's (RSH 22.56 -1.16) downside FY06 guidance continues to overshadow strong earnings from KB Home (KBH 75.47 +1.53) and Darden Restaurants (DRI 36.78 +1.98). Separately, the Q3 current account balance checked in at -$195.8 bln (consensus -$205.0 bln), but since a large deficit was widely anticipated, it has had little impact on overall participation. DJTA +0.3, DJUA +0.3, Nasdaq 100 -0.2, Russell 2000 +0.3, SOX -0.1, S&P Midcap 400 -0.1, XOI -1.3, NYSE Adv/Dec 1812/1302, Nasdaq Adv/Dec 1466/1360

11:30AM : Market rebounds somewhat as further deterioration in oil prices bodes well for the bulls. While the move higher has not been enough to make a significant change in the standings, it has inched the Nasdaq back into positive territory. Crude prices are now off $0.87 at $59.12/bbl amid warmer weather forecasts.NYSE Adv/Dec 1818/1221, Nasdaq Adv/Dec 1376/1396

http://today.reuters.com/investing/FinanceArticle.aspx?type=businessNews&storyID=2005-12-16T163650Z_01_DIT659782_RTRUKOC_0_US-AUTOS-FORD-GAY.xml

DETROIT (Reuters) - Ford Motor Co.(F.N: Quote, Profile, Research) is again facing a boycott threat from a conservative Christian group over the automaker's decision to run corporate advertisements in gay publications.

Tupelo, Mississippi-based American Family Association said Ford reneged on an agreement to pull ads from gay media.

"We had an agreement with Ford, worked out in good faith," said Donald Wildmon, chairman of AFA, in a statement on the group's Web site on Thursday. "Unfortunately, some Ford Motor Company officials made the decision to violate the good faith agreement."

snip>

The automaker, which has seen its U.S. sales fall in all but two of the last 18 months, cannot afford to lose customers now, analysts have said.

Ford is not the first company to come under fire for its stance on homosexuals. Other large companies including Microsoft Corp. (MSFT.O: Quote, Profile, Research) and Walt Disney Co. (DIS.N: Quote, Profile, Research) have also found themselves trying to appease groups on both sides of the cultural divide.

more...

Drive a Chrysler(or Caddie) for Christ, a Lincoln (or Lexus) for the Lord. New Christians will need the Navigator. All heathens will be issued Ford pick up trucks that don't have the cruise control fixed. Maybe a taste of the flames of hell will turn their miserable lives around.

superb graphics.....Hhmmmm, what would Jesus drive. An ass is so passe, not to mention embarassing. Can you imagine telling your friends you can't go to the mall because you have to wash your ass. And what person would want to show off their ass, even if it get 30 miles to the bushel and is eco friendly. And just where oh where will you put your W sticker and your support the troops sticker.
No Jesus is into a splashy miracle every now and then. He would drive a van (needs to seat 13) and would appear to be a SUV in the burbs, a low riding Chevy van in the barrios, and a extended cab truck in Texas.

http://news.yahoo.com/news?tmpl=story&cid=513&e=9&u=/ap/20051216/ap_on_go_ot/schools_heating_costs

excerpt:

As oil and natural gas prices soar, public schools are having to make some tough decisions: turning down the thermostat, finding alternative sources of fuel, even cutting back on the school week.

<snip>

In western North Dakota, the Killdeer School District is considering going to a four-day school week, triggered in part by higher fuel costs.

With the coldest months ahead, school business officers are worried most about heating their buildings. Rising fuel costs seem to affect the price of just about everything, they say, from furniture and deliveries to construction material and even garbage bags.

Simply budgeting more money to cover heating costs is more difficult than it sounds, said Anne Miller, executive director of the Association of School Business Officials International.

Schools sometimes gamble, lulled by mild winters and lower heating bills. They set aside less for heating and more for salaries or supplies. When a cold winter or an energy crisis comes, they may have to cut expenses from the class. Or just keep those classes colder.

...more...

Dow 10,885.19 +3.52 (+0.03%)
Nasdaq 2,254.72 -5.91 (-0.26%)
S&P 500 1,269.12 -1.82 (-0.14%)
10-Yr Bond 4.446 -0.22 (-0.49%)

NYSE Volume 1,815,053,000
Nasdaq Volume 1,655,319,000

2:30PM: Market continues to fluctuate around the unchanged mark as there isn't a strong sense of conviction on either the bullish or bearish side of the aisle. Meanwhile, the Dow Jones Industrial Average Index, which is less than 100 points off the 11,000 mark (not eclipsed since Mar. 3), remains the best performer among the major indices. The Dow Transportation Jones Average, which hit an all-time high on Nov. 23, has turned in a similar 0.2% performance as has the Dow Jones Utilities Index, which hit an all-time high on Oct. 4.NYSE Adv/Dec 1681/1541, Nasdaq Adv/Dec 1383/1570

2:00PM: Equities bounce off their lows but simply return to within their intraday ranges, as market internals still suggest a mixed bias. The market's holding pattern has been further evidenced in the A/D line, as advancers on the NYSE hold a slim 16-to-15 advantage over decliners while declining issues on the Nasdaq hold a slim 15-to-13 edge over advancing issues. The ratio of up to down volumes also paints a similarly mixed picture at the Big Board and the Composite while total volume, amid quadruple witching options expiration, remains well above normal. NYSE Adv/Dec 1667/1537, Nasdaq Adv/Dec 1339/1593

Dow 10,871.03 -10.64 (-0.10%)
Nasdaq 2,251.95 -8.68 (-0.38%)
S&P 500 1,267.55 -3.39 (-0.27%)
10-Yr Bond 4.448% -0.02
NYSE Volume 1,946,714,000
Nasdaq Volume 1,783,162,000

3:00PM: Split industry leadership continues to dictate late-day action, as the indices still struggle to gain much traction. Still acting as the biggest drag on the market is Energy, which is now off 1.9% at its worst levels of the day. With crude oil prices closing down 3.5% (and below $58/bbl), coupled with respective declines of 2.9%, 3.2% and 1.0% in heating oil, unleaded gas and natural gas, refiners, explorers and drillers -- the year's Top three performing S&P industry groups -- are three of today's five worst performers. XOI -1.6, NYSE Adv/Dec 1657/1582, Nasdaq Adv/Dec 1356/1621

Dow 10,875.59 -6.08 (-0.06%)
Nasdaq 2,252.48 -8.15 (-0.36%)
S&P 500 1,267.32 -3.62 (-0.28%)
10-Yr Bond 44.48 -0.20 (-0.45%)
NYSE Volume 2,584,192,000
Nasdaq Volume 2,418,688,000

While upbeat corporate news, plunging oil prices and falling bond yields helped investors eye blue chip bargains midday following yesterday's stalemate session, late-day volatility on account of quarterly options expiration contributed to the market's inability to close in positive territory. Known as "quadruple witching," such options-related activity, coupled with a mediocre Q2 report from Oracle (ORCL 12.69 -0.14) offsetting Adobe Systems (ADBE 38.82 +3.89) strong Q4 report, closed the technology-heavy Composite near session lows. Some rebalancing on the Nasdaq 100 also added to the volatility as Google (GOOG 430.15 +7.62), which hit a new all-time high amid reports it shut out Microsoft (MSFT 26.90 -0.02) by paying $1.0 bln for a 5% stake in Time Warner's (TWX 18.00 +0.16) AOL, will be officially added to the Nasdaq 100 on Dec. 19. The absence of leadership in Energy, which continues to account for the bulk of earnings growth on the S&P 500 but got hammered to the tune of -2.3% amid weakness across energy complex, also weighed on overall sentiment. Consumer Discretionary also closed lower as downside guidance from Carnival Corp (CCL 52.65 -2.19) and RadioShack (RSH 22.19 -1.53) overshadowed the encouraging TWX news as well as strong earnings reports from KB Home (KBH 74.92 +0.98) and Darden Restaurants (DRI 38.81 +4.01). Despite strength in steel, after Steel Dynamics (STLD 34.36 +0.74) issued upside Q4 EPS guidance, and gains in copper, after Morgan Stanley raised their estimates on Phelps Dodge (PD 141.00 +1.31) -- a suggested holding in Briefing.com's portfolio for active investors, weakness in chemicals weighed on Materials. The biggest drag came from consolidation in Monsanto (MON 75.61 -1.40), which hit an all-time high just nine days ago. Consumer Staples, which was in focus and provided early support following reports of a potential leveraged buyout of Albertson's (ABS 24.33 +0.34), also lost ground as investors locked in gains from Procter & Gamble (PG 58.11 -0.88), which hit a 52-week high two days. Of the four economic sectors that managed to hold onto gains, the rate-sensitive Financial and Utilities sectors posted modest gains. The 10-yr note closed up 4 ticks to yield 4.44%. Health Care also finished on an upbeat note, benefiting from by Johnson & Johnson's (JNJ 60.86 +0.70) entry into the insulin delivery market by acquiring Animas Corp (PUMP 24.03 +5.83) for $518 mln, while strong follow-through buying in United Technologies (UTX 58.03 +0.43), spurred by an analyst upgrade, helped Industrials eke out a small gain. Separately, the Q3 current account balance narrowed slightly (to -$195.0 bln from -$197.7 bln) but still checked in at its third highest level ever. Since another large deficit was widely anticipated, though, the report had little impact on overall trading. Nasdaq 100 -0.8, Russell 2000 -0.2, SOX -0.6, S&P Midcap 400 -0.5, XOI -1.7, NYSE Adv/Dec 1597/1700, Nasdaq Adv/Dec 1385/1661

that was a waste of makeup and shaved legs. Have a good weekend. We might be in for some more nasty weather so bundle up and drive safe. Or better yet stay home and call old friends and family, make some hot spiced cider and popcorn, and pop in a movie and watch it with family. That IS the best way to enjoy the holidays (low cost and fun).