STOCK MARKET WATCH, Wednesday May 9

Source: DU

Wednesday May 9, 2007

COUNTING THE DAYS
DAYS REMAINING IN THE * REGIME 621 LONG DAYS
DAYS SINCE DEMOCRACY DIED (12/12/00) 2320 DAYS
WHERE'S OSAMA BIN-LADEN? 2030 DAYS
DAYS SINCE ENRON COLLAPSE = 1990
Number of Enron Execs in handcuffs = 19
ENRON EXECS CONVICTED = 9
Enron execs conveniently deceased = 3
Other Arrests of Execs = 54

---

U.S. FUTURES & MARKETS INDICATORS
NASDAQ FUTURES-----------------------------S&P FUTURES

---

AT THE CLOSING BELL WHEN BUSH TOOK OFFICE on January 22, 2001
Dow - 10,578.24
Nasdaq - 2,757.91
S&P 500 - 1,342.90
Oil - $27.69/bbl
Gold - $266.70/oz.

AT THE CLOSING BELL ON May 8, 2007

Dow... 13,309.07 -3.90 (-0.03%)
Nasdaq... 2,571.75 +0.80 (+0.03%)
S&P 500... 1,507.72 -1.76 (-0.12%)
Gold future... 687.40 -3.00 (-0.44%)
30-Year Bond 4.80% +0.01 (+0.17%)
10-Yr Bond... 4.63% -0.00 (-0.04%)






GOLD, EURO, YEN, Loonie and Silver

---

PIEHOLE ALERT

Heads Up!
Preliminary info on appearances by Bush & Co. throughout the country. Details & links are added as they become available so check back. And if you know more, are organizing something, or would like to, contact actionpost@legitgov.org

For information on protests and other actions Citizens For Legitimate Government

---

Read more: DU

AWASH in Liquidity
BY FRANK BARBERA, CMT

What A Week! Lousy employment numbers, lousy GDP numbers, and of course, new all time highs in the Dow with the index up 24 of the last 27 days, the longest winning streak since the late 20’s. Pretty funny, huh? Say, haven’t we played out this script before? Doesn't there seem to be something all too eerily familiar about this? Remember early 2000 when the Fed was tightening, the yield curve inverted, the economy slowed, and yet the rabid liquidity monster kept expanding multiples on Tech Stocks? Cisco and Yahoo to the Moon! And then, ... well, we all remember that one… down, down, down through the floor!

Seems we’ve just been on some stock market version of “Ground-Hog Day,” like Poor Bill Murray reliving the same day over and over again. OK, this time we have small twists. Google, instead of America Online as the new media darling, rumors of a Yahoo! buy-out by Microsoft (fat chance), and wild speculation orbiting Amazon.com, driving the stock up nearly 50% in two days. Some things never change. Anyway, there can be no doubt that it is the massive sea of liquidity that continues to keep the stock market aloft, with broad money supply measures advancing at double digit rates. Even the imputed, re-pieced together and guess-timated M-3, which experts believe is now growing close to 14%. Well, Well, Well! With all the hot money sloshing around, no wonder some folks are worried about a rerun of the recent past. Did you see the headlines flashing on CNBC last week quoting the NY Fed?

“Hedge Fund risks worst since 1998 LTCM Crisis” by Reuters

“Hedge Fund Study suggests parallels with LTCM Crisis” by CBS Marketwatch

Note: To those who do not tolerate high levels of financial pain, we have not left our “Collapsing Chinese Stock Market” days behind us. At the present rate of ascent, my guess would be that yet another big shock wave should be coming from the Shanghai Market within the next few weeks. Judging from the extended nature of the chart, a sell off back down toward 3,200 should be in the cards by mid-June at the latest, about a 20% haircut in the Shanghai Composite. That means we are virtually sure to see a few hair-raising days for the Dow and maybe other world markets. Yet before venturing into the sorted technical details on the subject of a runaway liquidity driven boom, I quote none other than perhaps the most esteemed expert on the subject, Prudent Bear’s top Credit Market Analyst Doug Noland.

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

10:30 AM Crude Inventories 05/04
Briefing Forecast NA
Market Expects NA
Prior 1169K

2:15 PM FOMC policy statement

http://biz.yahoo.com/c/e.html

01. FOMC repeats core inflation remains 'somewhat elevated'
2:21 PM ET, May 09, 2007 - 9 minutes ago

03. FOMC repeats future rate moves depend on data
2:19 PM ET, May 09, 2007 - 11 minutes ago

05. FOMC policy statement only tweaks wording of last statement
2:19 PM ET, May 09, 2007 - 11 minutes ago

06. FOMC vote unanimous
2:19 PM ET, May 09, 2007 - 11 minutes ago

07. FOMC says economy has slowed but should pick up
2:19 PM ET, May 09, 2007 - 11 minutes ago

12. FOMC holds rates steady at 5.25% as expected
2:18 PM ET, May 09, 2007 - 12 minutes ago

13. FOMC repeats inflation 'predominant' concern
2:18 PM ET, May 09, 2007 - 12 minutes ago

SINGAPORE - Oil prices traded in a tight range Wednesday amid expectations an upcoming U.S. inventories report would show a rebound in gasoline stocks for the first time in three months.

Light, sweet crude for June delivery rose 6 cents to $62.20 a barrel in midafternoon Asian electronic trading on the New York Mercantile Exchange.

June Brent crude was up 1 cent at $65.55 a barrel on London's ICE Futures exchange.

Prices had climbed Tuesday after the U.S. government said the price of gasoline was expected to rise this summer due to ongoing problems at the nation's refineries.

-cut-

Analysts surveyed by Dow Jones Newswires expected the report to show gasoline stocks rose 370,000 barrels last week, on average. It would be the first increase in gasoline stocks in 13 consecutive weeks.

http://news.yahoo.com/s/ap/oil_prices

WASHINGTON - A plan to increase fuel efficiency standards to an average of 35 miles per gallon by 2020 won approval from a Senate panel Tuesday in a vote closely watched by automakers and environmental groups.

The Senate Commerce, Science and Transportation Committee approved the measure, which would raise the nationwide fleet fuel economy average by about 40 percent from current levels of 25 mpg for cars and trucks. The bill, approved on a voice vote, would also increase standards by 4 percent a year from 2020 through 2030.

"This is not a perfect bill, but I think we have reached a stage where most parties would say this is fair," said Sen. Daniel Inouye (news, bio, voting record), D-Hawaii, the committee chairman.

He said the bill would be considered before the full Senate in June.

http://news.yahoo.com/s/ap/20070508/ap_on_bi_ge/fuel_economy

http://globalguerrillas.typepad.com/globalguerrillas/2007/05/journal_shell_d.html

Last year, Shell Oil abandoned facilities that produced 600,000 barrels a day of oil due relentless attacks by the global guerrilla facilitator MEND. Upon its return to these facilities this month, the company found much of its infrastructure missing. In the area near the Forcados terminal alone, 435 miles of pipeline disappeared (likely disassembled by hand, loaded onto barges, offloaded onto Ukrainian transport ships offshore, and delivered to Chinese scrap metal dealers -- globalization is grand, isn't it). Estimates of the reconstruction costs now exceed $2 billion, under the assumption both Shell and its construction partners will be allowed to return unimpeded. That isn't a good bet: 11 Daewoo construction workers working on a power plant deep inland (which shows the guerrillas have more reach than ever) were kidnapped and two assaults were made on off-shore platforms as recently as last week. Further, MEND like its counter-parts in Iraq, are very adept at the disruption of corporate activity. So far, the returns on its investments (ROIs) have been stellar.

more...

http://quotes.ino.com/chart/?s=NYBOT_DX&v=i

Last trade 81.985 Change +0.044 (+0.05%)

Dollar Rallies into Federal Reserve FOMC Policy Announcement

http://www.dailyfx.com/story/bio1/Dollar_Rallies_into_Federal_Reserve_1178659573843.html

The dollar is rallying into the FOMC announcement. Even though growth indicators warrant a more neutral statement, inflation pressures could prevent Team Bernanke from making any drastic changes.

· Dollar Rallies into Federal Reserve FOMC Policy Announcement

· Euro: Prospect of an ECB Rate Hike Could Limit Losses in the EUR/USD

· British Pound Could Bounce on BRC Retail Sales and Nationwide Consumer Confidence



Dollar Rallies into Federal Reserve FOMC Policy Announcement



With the Federal Reserve monetary policy meeting scheduled for tomorrow, currency traders are either buying up dollars against the Euro and British pound or squaring up shorts ahead of the rate decision. Even though we think that growth indicators warrant a more neutral FOMC statement, inflation pressures will prevent Team Bernanke from making any drastic changes to the language. Our special FOMC outlook on DailyFX.com contains a full look into how economic data has changed since the last meeting as well as the key phrases to look for in the statement. The Federal Reserve has not changed interest rates since June 2006 and the futures curve is not pricing in a rate cut until the end of the year. The tug of war between inflation and growth at a time when average gasoline prices are at a record high gives the Fed little room to alter the FOMC statement. Keeping interest rates steady and the statement unchanged will be taken positively by the foreign exchange market, which could lead to a resumption of the uptrend in USD/JPY. We expect the dollar to see more pronounced strength against the Yen than the Euro in reaction to any dollar positive news due to the benefit of carry. Do not forget that the European Central Bank has a meeting on Thursday. They are still on track to raise interest rates in June which means that Euro traders may be hesitant of initiating significant Euro shorts ahead of the meeting. Japan on the other hand continues to sit on their hands. In the event of a surprisingly neutral or dovish statement, we could see the EUR/USD race back towards its all-time highs. Being short USD/JPY may cost too much in daily interest for traders to sell the pair aggressively. Therefore a disappointment by the Fed and the prospects of higher rates in the Eurozone and in the UK could lead to strong rallies in both the Euro and the British pound. The only pieces of US data released today were wholesale inventories and sales. Inventories fell short of expectations, but sales were exceptionally robust.

...more...

Does Carry Drive the Dow?

http://www.dailyfx.com/story/bio2/Does_Carry_Drive_the_Dow_1178709252112.html

What does the carry trade tell us about the stock market?

Studying the price action in both currencies and stocks over the past several decades we have discovered several interesting dynamics between the movement in the carry trade and the uptrend in stocks. While there is some correlation it is by no means uniform. Nevertheless, by having a deeper understanding of the price movements in both markers, traders should be able to better ascertain the rewards and the possible pitfalls that await them.

Carry Trade – It’s not Just the Yen

When most investors talk about the carry trade, they inevitably refer to the USDJPY pair which has been the dominant carry trade strategy over the past several years attracting billions of dollars of capital. Japan’s decade long struggle with deflation which at one point reduced interest rates in the country to 0% has made the yen the perennial favorite funding currency against high yielders such as the British pound, the Australian and New Zealand dollars and of course the greenback. However, using USDJPY as a proxy for the carry trade greatly limits our analysis and skews the historical record. Note, that as recently as 2004 USD short term rates were 1% and the greenback itself was used as the funding currency rather than as the high yielder in many carry strategies.

In order to more accurately measure the price action of the carry trade we created a rolling carry trade basket composed of top three high yielding currencies against the bottom three low yielding currencies updated daily over the past seventeen years using 3 month LIBOR rates for each country. For our universe of currencies we used the majors (EURUSD, USDJPY,GBPUSD, USDCHF) as well as the commodity dollars (USDCAD, AUDUSD, NZDUSD).

The difference is startling. Note in Figure 1 how over the past several years USDJPY trade was actually range bound, subject to a multitude of factors from political risk events to compression and then expansion of interest rates between US and Japan. However, the carry trade basket equity curve displays a near perfect uptrend during the same period, indicating that the over that time horizon the strategy was consistently profitable.



...more...

When it comes to valuing the dollar against other currencies, two words stand proud: 'rally' and 'tank'. As the chart above illustrates the dollar has traded in whipsaw fashion since Bush was crowned sovereign.

it was just a part of the plan to destroy our economy.

:grr:

WASHINGTON - It's been nearly a year since the Federal Reserve last changed interest rates and there are no expectations the central bank is going to deviate from its stay-the-course policy any time soon.

Federal Reserve Chairman Ben Bernanke and his colleagues were expected to announce at the end of Wednesday's meeting that they decided for the eighth straight time to leave the federal funds rate unchanged at 5.25 percent.

That is where it has been since the Fed last changed rates June 29, when it raised the funds rate for a 17th consecutive time over a two-year period. That was the longest stretch of Fed rate hikes on record as the central bank sought to slow the economy and combat rising inflation pressures.

-cut-

Economic growth slowed to an annual rate of just 1.3 percent in the January-March quarter, the slowest pace in four years.

That slow growth is having the desired effect of taking some of the pressure off tight labor markets. The unemployment rate inched up a tad to 4.5 percent in April with businesses creating just 88,000 new jobs, the weakest showing in 2 1/2 years.

http://news.yahoo.com/s/ap/20070509/ap_on_bi_ge/fed_interest_rates

NEW YORK - U.S. stocks headed for a moderately lower open Wednesday ahead of the Federal Reserve's meeting on interest rates and a day after Wall Street took a break after a string of advances.

Because investors expect the Fed's Open Market Committee to keep interest rates unchanged as it has done since last summer, they're more concerned about the central bank's economic assessment statement. Wall Street is hoping the Fed will indicate it is inclined to cut rates by the end of the year to make access to capital cheaper and thus lend a boost to stocks.

On days the Fed makes its announcements, stocks often tread water until the committee releases its statement at 2:15 p.m.

Dow futures expiring in June fell 14 points, or 0.10 percent, to 13,332. The blue chip index, which closed moderately lower but essentially flat Tuesday, has hit 20 record closes since the start of the year and 42 since the beginning of October, its latest coming Monday.

http://news.yahoo.com/s/ap/20070509/ap_on_bi_st_ma_re/wall_street

TOKYO - Toyota's first-quarter profit quarter climbed 9 percent as the automaker marked its seventh straight fiscal year of record sales amid robust demand for its Corolla, Camry and Lexus models.

Toyota Motor Corp., which beat General Motors in worldwide vehicle production and sales in the first quarter for the first time ever, reported a quarterly group profit of 440.1 billion yen ($3.67 billion) from 404 billion yen the same period the previous year, the manufacturer said Wednesday.

Toyota's sales are surging as soaring gas prices boost the appeal of its models, which are reputed worldwide for fuel-efficiency, including gas-and-electric hybrids like the Prius.

Analysts say Toyota is growing so quickly it's just a matter of time before it overtakes problem-laden General Motors Corp. of the U.S. to become the world's No. 1 automaker — a title that technically hinges on worldwide vehicle production for an entire year.

http://news.yahoo.com/s/ap/20070509/ap_on_bi_ge/earns_japan_toyota_4

TOKYO (Reuters) -- Toyota posted a surprise fall in quarterly operating profit as it booked sales costs and other spending early, and it forecast little growth this year to brace for tougher commodity and currency markets.

Sales of Toyota's (Charts) cars have been buoyant in the sputtering U.S. and European markets, but a shift towards smaller, lower-margin cars as well as heavy spending on new factories and research and development has kept profit margins in check.

-cut-

It forecast annual operating profit to rise 0.5 percent to 2.25 trillion yen, for a seventh straight year of record earnings and a profit-to-sales margin of 9.0 percent, down from 9.3 percent in 2006/07.

http://money.cnn.com/2007/05/09/news/companies/toyota.reut/index.htm?postversion=2007050906

NEW YORK (Reuters) -- Luxury home builder Toll Brothers said on Wednesday it would post lower quarterly home building sales and warned it no longer expects to achieve its most recent quarterly and annual forecasts.

"Twenty months into this housing downturn, we continue to face difficult conditions in most of our markets," Chief Executive Robert Toll said in a statement releasing the company's preliminary second-quarter results.

-cut-

Demand has weakened further lately, as problems in subprime mortgage lending - loans to those with sketchy credit histories - have made it more difficult for some potential buyers to qualify for a mortgage.

http://money.cnn.com/2007/05/09/news/companies/toll.reut/index.htm?postversion=2007050907

since there are more middle class folks needing an affordable house, maybe you are working the wrong part of the bell curve. Of course, your would have to work harder to earn the same, but then don't we all. And gee, you might have to but more folks to work too.

My dad lives in a retirement community that has just raised everyone's rents substantially. The owners are struggling with a 24% vacancy rate -- where historically it's run about 8-9% -- and are trying to make ends meet by squeezing all the current residents.

But the real joker is what my dad told me was the reason for the high level of vacancy. The community demands a substantial down-payment from most entering residents, in return for which they get certain guarantees, I believe involving extended care at a nursing-home level if they should need it. New residents in the past have typically come up with that chunk of cash by selling their homes at a nice profit.

The system was already coming under strain because the generation of retirees that bought houses cheaply in the early 50's is giving way to a generation that bought theirs in the 60's and isn't realizing the same sort of profit. But now, with the problems in the housing market, everything is suddenly worse. Retirees who would like to sell their houses either can't do it or are having to cut the price to a point where it doesn't cover the down-payment for the retirement community. And because retirement communities lose residents at a fairly steady pace, it doesn't take long for any slowdown in the replacement rate to show up in the bottom line.

There's yet another factor, though -- which is that some of the current residents are wondering if they're going to be able to continue to pay the increased rents. My dad, who chose to live there on a lease-only basis and forgo the extended care, is very happy at this point that he kept his options open. But what about the rest of them? Where do you go if you've handed over a major chunk of your nest egg and then have to forfeit it?

And what happens if the entire system of retirement communities becomes unaffordable to the middle class? Traditional city neighborhoods and small towns were set up in way that made it possible for older people to get around and do their errands on foot or with short, easy drives. Suburbs aren't. They don't have the commercial zoning. Sometimes they don't even have sidewalks.

So what happens next?

http://www.bloomberg.com/apps/news?pid=20601087&sid=aoMSaUJr0qD4&refer=worldwide

May 8 (Bloomberg) -- U.S. home price declines this year are going to be steeper than earlier forecast because of the drop in subprime mortgage lending and the adoption of stricter loan standards, the National Association of Realtors said.

The 2007 median price for an existing home likely will drop 1 percent to $219,800 from 2006, compared with its earlier forecast of a 0.7 percent decline, the Chicago-based association said in a report today. It now projects the median price for new homes to fall $100 to $246,400, the first decline since 1991, from its previous estimate of a 0.4 percent increase.

Record-high defaults by subprime borrowers, those with flawed or insufficient credit histories, have prompted mortgage lenders to limit the number of people who qualify for a home loan, according to the realtors' report. At the same time, unemployment is down and household incomes are up, which should help bring a housing recovery in 2007's third and fourth quarters, the group said.

more...

:donut: and lurkers. I am up very early to make sure some students get their meds for the field trip today. If I could give them to the teachers-they would probably take them. Today is a busy day for me so I may not be around much.

Well, we will know about the Fed and interest rates today. I still maintain that they will leave it be, but if they do raise it, it will be a tiny amount. I think if they read the real set of books, we are in bad shape. If they read the fake books, the economy is going great rah rah.


I have been working hard to find my joy lately. I found my joy in an amazing way last night. I pulled into my parking space late last night. I sat in my car for a moment, collecting my thoughts.

Suddenly I saw a flicker of light. It was a familiar greenish yellow glow that I have not scene in 48 years. I thought I was imagining it. It flickered again. It can't be I thought. It flickered again and again and then stopped. Near a trailer, near a busy street, was a little lonely firefly-looking for a mate (or an honest man). If I hadn't seen it, I would not have believed it. All of a sudden I was transported to a time an place far far away. I remembered my aunt giving me a pillow case so I could trap fireflies and put them in a canning jar with cheese cloth lid. I would run with joyous abandon through the large country yard of my Aunt and Uncle's home. I'd use my fire fly lamp to run through the Thicket and woods near their house, always making sure I could see their porch light. I remember going to bed, clutching my little lantern and going to sleep watching the familiar shimmering green glow. I would wake up the next morning, go out to their giant Victorian wrap around porch, open the jar and release my winged friends. I had many things to do before I could play with them again.

I paused for a minute. The poor thing won't make it. This is a busy street, he'll be on someones window before too long. Then I thought...he shouldn't even be here now, but there he is. I sat a minute longer, quite, no thoughts in my head. Then I went inside.

Happy hunting and watch out for the bears.

08:30 am : S&P futures vs fair value: -3.6. Nasdaq futures vs fair value: -10.5. The futures market continues to deteriorate, suggesting an even weaker start for the indices. Mixed earnings news and trepidation ahead of the Fed aside, a growing sense that stocks are overbought is also contributing to the negative disposition. Such concerns weighed on sentiment throughout yesterday's session; but the major averages merely closing relatively unchanged offered little conviction on the part of sellers who today appear armed with more evidence to support their argument.

08:00 am : S&P futures vs fair value: -2.8. Nasdaq futures vs fair value: -8.5. Futures indications are trading below fair value, pointing to a lower open for stocks. With expectations from Cisco Systems (CSCO) and Walt Disney (DIS) running high ahead of their reports last night, Cisco merely issuing in-line Q4 revenue guidance and a Q2 sales shortfall at Disney have sparked some profit taking in both large-cap names.

I work (for the next 20 days) as a retail manager of a major US retailer. During the past month, our major competitors announced their quarterly earnings. Their results were not terrible, but they showed a lot of weakness in domestic U.S. sales. Their stocks took major hits on the basis of this news. My company will announce thier earnings next week, and on the basis of my (incomplete) insider knowledge, I expect the same type of results as our competitors.

Overall, I've been seeing these same kind of numbers from most major retailers, which seems to indicate to me that domestic spending is slowing pretty quickly.

Despite this news and the implications, however, the stock market as a whole continues to rise. I can only infer that major investors are concluding that the U.S economy no longer matters when it comes to their forecasts of how publically-traded companies will do in the future.

I'm no economist. Am I reading this all wrong?

do regard the U.S. economy as vital to their continued success. The past-to-present difference in overall "regard" is the global nature of economics. Emerging economies like China and India offer prime opportunity to gain footholds in areas of the world where U.S. based companies were stymied before. Japan, for example, has exercised for decades some of the strictest import and manufacturing controls in the world. So, yes, the U.S. remains vital to the companies that are based here and elsewhere that continue to do business here.

The overseas attraction for companies can be credited to lack of environmental and business regulations, pay scales, cheap transportation costs, political stability, etc. But this is always in a state of flux. As the political climate changes around the world so will the value that companies place on those markets.

You are mis-reading the tea leaves a bit in this case. Suffice to say that the way things seem now are not the way they'll always be.

Dow 13,300.21 Down 8.86 (0.07%)
Nasdaq 2,560.84 Down 10.91 (0.42%)
S&P 500 1,506.15 Down 1.57 (0.10%)
10-Yr Bond 4.636% Up 0.002
NYSE Volume 653,525,000
Nasdaq Volume 539,229,000

10:30 am : Finally, the bulls are getting some support from turnarounds in a couple of influential areas. Financials, the most heavily weighted economic sector, has recently inched into positive territory. Renewed enthusiasm for Banks and strength across the REIT complex are providing the bulk of early support.

Industrials and Consumer Staples are the other sectors of note turning the corner while chip stocks spiking into positive territory over the last 30 minutes have helped the Tech sector pare some of its losses. Texas Instruments (TXN 36.02 +0.85) is surging 2.4% amid encouraging developments out of its two-day analyst meeting. DJ30 -2.82 NASDAQ -10.68 SOX +0.4% SP500 -0.93 NASDAQ Dec/Adv/Vol 1572/1095/420 mln NYSE Dec/Adv/Vol 1337/1544/204 mln

10:00 am : The indices are bouncing off their opening lows but hardly enough to make a significant change in the standings. The Dow briefly turned positive, entirely due to a 1.3% surge in shares of IBM (IBM 104.59 +1.30); but Big Blue's roughly 10-point contribution hasn't been enough to keep the Dow in the green.

Of the seven sectors now trading lower, Technology paces the way with a 0.6% decline and remains the biggest obstacle for the bulls to overcome early on. Telecom is today's best performing sector, getting its biggest lift from renewed takeover speculation in Alltel (AT 65.93 +0.73). However, a 0.4% advance in one of the S&P 500's least influential sectors hardly provides enough support to get overall buying efforts back on track. DJ30 -7.44 NASDAQ -14.29 SP500 -2.45 NASDAQ Dec/Adv/Vol 1714/827/242 mln NYSE Dec/Adv/Vol 1618/1120/94 mln

http://www.kitcocasey.com/displayArticle.php?id=1373

Good day... Well... Today is an FOMC meeting... And it's also the day the subcommittees meet to talk about "manipulated currencies" (yen and renminbi)... Although the markets have decided to go along with me and not expect any type of move from the Fed today, we saw a ton of position squaring yesterday ahead of the meeting... Strange, but true!

Yes, the bias yesterday was to square positions ahead of the meeting, even though no one expects the Fed to do anything... That meant the bias was to sell currencies, take profits, and buy dollars to cover short positions... At one point in the day, it looked as though the position squaring would take the euro below 1.35, but that was not to be, and by the end of the day, the euro was back to 1.3545...

It will be interesting to hear what Big Ben Bernanke has to say this afternoon after he holds rates steady once again. I think that whatever it is he has to say, the risks to the dollar remain on the downside... Why? Well, you don't think he would sully his reputation as an intellectual by telling us the economy is doing just fine, do you? He has already brought about some question of his intellect by saying last month that the mortgage sector was stabilizing, or something to that effect.

Hey! If the economy was doing so "great," why haven't Big Ben and the Fed Heads raised rates since last summer? Yes... Put that one in your pipe and smoke it!

more...

http://www.financialsense.com/fsu/editorials/laird/2007/0509.html

THE story today is a world financial bubble. Aside from a possible attack on Iran – The story right now is a world financial bubble. This article will discuss it in very broad terms. The thesis is that maybe you should right now be thinking about getting liquid – gradually. I consider our time right now, May 07, to be a time just like before the world stock crash of ‘29.

Imagine what people would have thought, if, after the stock market crashed in successive waves over a period of a year into 1930 – what they would have though it they could have gotten out of those markets in say, Feb 29…..and not ridden stocks down 50% .. and later 90%, in the several years following the ’29 crash.

If you wanted to sell stocks or whatever, it makes sense to sell in liquid markets that are going up right?

Or would you rather wait, and sell in falling markets after they had peaked? That is what greedy people do.

On the other hand, the ‘insider’ types usually sell in the last stages of a bull market, and we see ‘distribution’ patterns that precede stock crashes. Only this time, we are looking at a world stock crash – as if the world stock markets together were one market. The present world bubble is an unprecedented world financial mania, never seen before, and at least 1000 times the money value of the 1929 world stock market. It is synchronized. It will all crash on one swoop eventually.

more...

Highlights

Current:



30-day and 90-day vs.greenback:



30-day vs. Euro, Yen, UK Pound and Swiss Franc




Currency Comparison: http://members.shaw.ca/trogl/looniewatch.html

Detailed analysis: http://quotes.ino.com/exchanges/?r=CME_CD

Up-to-the-minute graph: http://quotes.ino.com/chart/?s=CME_CD.H06&v=s

Historical values http://www.x-rates.com/d/USD/CAD/data30.html

2007-04-09 Monday, April 9 0.867905 USD
2007-04-10 Tuesday, April 10 0.871156 USD
2007-04-11 Wednesday, April 11 0.873439 USD
2007-04-12 Thursday, April 12 0.880127 USD
2007-04-13 Friday, April 13 0.878812 USD
2007-04-16 Monday, April 16 0.884251 USD
2007-04-17 Tuesday, April 17 0.885504 USD
2007-04-18 Wednesday, April 18 0.885897 USD
2007-04-19 Thursday, April 19 0.886054 USD
2007-04-20 Friday, April 20 0.89071 USD
2007-04-23 Monday, April 23 0.890869 USD
2007-04-24 Tuesday, April 24 0.890631 USD
2007-04-25 Wednesday, April 25 0.897183 USD
2007-04-26 Thursday, April 26 0.892698 USD
2007-04-27 Friday, April 27 0.8967 USD
2007-04-30 Monday, April 30 0.903506 USD
2007-05-01 Tuesday, May 1 0.901876 USD
2007-05-02 Wednesday, May 2 0.901957 USD
2007-05-03 Thursday, May 3 0.903424 USD
2007-05-04 Friday, May 4 0.903424 USD
2007-05-07 Monday, May 7 0.907112 USD
2007-05-08 Tuesday, May 8 0.905141 USD


Current values

Last trade 0.9051 Change -0.0014 (-0.15% )
Previous Close 0.9063 Open 0.9050
Low 0.9042 High 0.9064


Blather (from http://quotes.ino.com/exchanges/?r=CME_CD)

The June Canadian Dollar was lower in overnight trading as it consolidates some of this spring's rally. Stochastics and the RSI are overbought, diverging and are neutral to bearish hinting that a short-term top might be in or is near. Closes below the reaction low crossing at .8986 would signal that a short-term top has been posted. If June extends the rally off February's low, last May's high crossing at .9200 is the next upside target. Overnight action sets the stage for a lower opening in early-day session trading.


Analysis

Should be a quiet day unless the shoe drops on the greenback.

http://articles.moneycentral.msn.com/Investing/ContrarianChronicles/TheDowsDangerousWinningStreak.aspx

Folks can be forgiven for rolling their eyes at general statements that begin: "The historical data suggest that . . ." But apply this to potential stock-market gains and losses, and people's attention usually perks up.

Recently, I decided to revisit a chart of Japan's Nikkei index from 1989. What prompted me were comments by GMO Chairman Jeremy Grantham that, for America's current stock bubble to burst, it may need to go parabolic, a la Tokyo 1989.

When I read that, I thought: Wait, the Nikkei did not go parabolic at the end in 1989. I was short that market in 1989 and held long-dated put warrants, so I followed it quite closely. In the final five months before its crash, the Nikkei was almost orderly, rallying about 20%. By contrast, the Nasdaq Composite Index ($COMPX) nearly doubled in the last five months before the 2000 crash.

more...

"Consequently, I no longer believe it's possible to determine in advance just what asset classes might be safe in a financial dislocation, as so many of them have become so intertwined, while at the same time we can't know how leveraged any of the underlying positions may be."

and...

"Against that backdrop, I cannot shake this nagging feeling that the most important idea for folks to consider before the coming dislocation hits, whenever it hits, is that it will be necessary to have some liquidity, even if that liquidity is held in a crummy currency like the dollar."

----

Pulling back from my foreign investments to liquidity in a sinking dollar? Damned if I do and damned if I don't. Grrrrrrrrrrrrrrrr.

at your house. it may be misting or sunny across town.

I personally have most invested for now in a 403b plan jane 3% plus guaranteed, and the rest in overseas emerging markets, and large caps. Other economies may be in the doldrums, but they might recover quicker than ours.

The best interest I get on most of my money is the interest I save by not giving it to Credit Card companies. Getting out of debt and saving THAT money is my aim.

I have some savings and will be buying a few shiny things. To quote from the movie Schindler's List-in the future, we may need more portable wealth.

I like the look of commodities too. I don't trust stocks now. I want to be able to see what I am investing in. I will wait a while before I do real estate.

I am not promoting one thing or the other, I am just telling you what I like.

both U.S. companies and foreign. If the U.S. economy implodes, I'm not betting foreign markets will be any rosier. I have a bond index fund, a money market fund, and a few cd's. What I'm most worried about is that these 'cash-type' investments might end up being worthless if the U.S. economy implodes and foreign markets follow like-wise. At least we have our house paid for and our kids are grown and on their own. A recession/depression will definitely affect them terribly.

on our income level(SSDI), our hedge against chaos is a well-stocked pantry and lots of canned goods...can't afford shiny things- barely held onto what we had through the Ch.7 bankruptcy.

Dow 13,362.87 Up 53.80 (0.40%)
Nasdaq 2,576.34 Up 4.59 (0.18%)
S&P 500 1,512.58 Up 4.86 (0.32%)
10-Yr Bond 4.668% Up 0.034
NYSE Volume 2,935,508,000
Nasdaq Volume 2,192,705,000

4:20 pm : After taking a breather Tuesday, stocks got back on the buying track today and lifted the Dow to yet another record high. More M&A speculation and falling oil prices were the initial sources of market support. The absence of any surprises in today's Fed statement, though, helped clear the way for several weeks of underlying bullish momentum to resurface.

Per usual, all eyes were anxiously fixed on today's FOMC meeting, the first since March. As expected, policy makers left rates unchanged at 5.25% for a seventh straight time. The accompanying policy directive was also little changed from the prior statement, suggesting that rates are likely to stay steady for the foreseeable future. Even though the report did not imply a rate cut anytime soon, the mere culmination of the meeting removed the latest headwind and excuse for sellers to keep questioning current valuations in a market awash in liquidity.

With regard to ongoing speculation about further deal-making, Rio Tinto (RTP 295.39 +30.74) reportedly being eyed by BHP Billiton (BHP 53.45 +2.55) in a deal that could top $100 bln helped power the Materials sector higher even though Rio Tinto shot down such speculation.

Alltel (AT 66.53 +1.33) reportedly being targeted by three private-equity consortiums as a potential $25-30 bln takeover was another. Alltel's 2.0% surge helped vault Telecom to the day's number one spot.

Rarely does M&A news, rumored or not, fail to give brokerage stocks a boost. Financials was another bright spot today as was the Industrials sector. Both turned in similar gains of 0.6%.

Technology was also in focus Wednesday, but initially for negative reasons. Cisco Systems (CSCO 26.51 -1.85), a suggested holding in the Briefing.com Active Portfolio, beat analysts' forecasts Tuesday night; but its Q4 sales guidance left the market wanting more. Since Cisco is Tech's third most influential component, accounting for 6.8% of the sector's total weighting, Cisco's 6.5% tumble was a drag on tech all day. Two of the sector's saving graces were IBM (IBM 104.38 +1.09) and Texas Instruments (TXN 36.83 +1.66). IBM was upgraded to buy at Goldman Sachs while TI soared 4.7% amid encouraging developments out of its two-day analyst meeting.

The Energy sector's ability to withstand another pullback in oil prices was also noteworthy. Crude for June delivery fell 1.1% to a seven-week low of $61.55/bbl after the Energy Dept. reported the first build in gasoline supplies in 13 weeks. DJ30 +53.80 NASDAQ +4.59 SOX +1.7% SP500 +4.84 NASDAQ Dec/Adv/Vol 1353/1652/2.14 bln NYSE Dec/Adv/Vol 1177/2059/1.47 bln