Financial Review

Slow Motion Domino

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-11-10-2015.mp3Podcast: Play in new window | Download (Duration: 13:17 — 6.1MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe for 11-10-2015 DOW + 27 = 17,758 SPX + 3 = 2081 NAS – 12 = 5083 10 YR YLD – .02 = 2.32% OIL + .22 = 44.09 GOLD – 2.50 = 1090.40 SILV – .14 = 14.54   Crude prices are set for a slow recovery, according to the latest report from the International Energy Agency, which warned against the deep investment cutbacks in the industry. In its World Energy Outlook, the IEA’s central scenario for oil prices forecast that the market would rebalance at around $50 to $80 per barrel in 2020, (a not very precise guess) “with further increases in price thereafter.” It also predicted that collectively, the U.S., EU and Japan would see their oil demand drop by around 10 million barrels a day by 2040.   Oil production from the Bakken and Eagle Ford shale plays in the U.S. has been falling since March. Total oil output from seven major U.S. shale regions is expected to fall by 118,000 barrels a day to about 4.95 million barrels a day in December. There is no evidence at current prices that rig drilling activity will recover any time this year, so we can expect ever lower production every month well into 2016. That doesn’t mean a quick increase in prices, in part because Iranian oil is expected to come online as sanctions are lifted, and also …

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Financial Review

Anti-Austerity Gets Wind in Sails

http://media.blubrry.com/eatthebankers/p/content.blubrry.com/eatthebankers/SINCLAIR_NOE-SEG_1-02-02-2015.mp3Podcast: Play in new window | Download (Duration: 12:46 — 5.8MB)Subscribe: Apple Podcasts | Android | RSSFinancial Review by Sinclair Noe DOW + 196 = 17,361 SPX + 25 = 2020 NAS + 41 = 4676 10 YR YLD – .01 = 1.67% OIL + 1.59 = 49.83 GOLD – 9.30 = 1274.80 SILV – .05 = 17.28 Americans cut spending in December by the largest amount since 2009; we knew spending on energy would be lower but consumers did not rush out and spend the money. Household savings from lower energy costs, were partly offset in December by higher spending on drugs, health care and housing. These expenses continue to eat up a large portion of American incomes. Incomes posted another solid gain and falling inflation is allowing Americans to get more bang for their buck. Personal spending fell a seasonally adjusted 0.3% last month. Personal income, meanwhile, rose 0.3%. Since income growth outpaced spending, the amount of money individuals save jumped to 4.9% from 4.3% to mark the highest level since midsummer. The Commerce Department reports construction spending rose 0.4% in December to a seasonally adjusted annual rate $982.1 billion, led by public spending. Private-construction spending rose 0.1% in December, with a 0.3% increase for residential projects and a 0.2% decline for nonresidential projects. Meanwhile, public-construction spending rose 1.1% in December. The ISM Manufacturing Report for January dropped from 55.1 to 53.5. Any reading above 50 indicates the manufacturing sector is expanding, just not as fast. Germany’s Angela …

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Friday, October 26, 2012 – Thank God It’s Friday

DOW + 3 = 13,107SPX – 1 = 1411NAS – 1 = 298710 YR YLD – .08 = 1.75%OIL -.43 = 88.30GOLD + .80 = 1712.10SILV – .02 = 32.19 PLAT – 16.00 = 1551.00 The U.S. economy grew in the third quarter, the GDP grew at a 2% rate, a bit stronger than the 1.7% expected by economists, and up from the 1.3% rate in the second quarter. Consumer spending and federal government spending increased and the housing market and home construction were areas of strength. Business spending continued to be a drag. GDP is the broadest measure of an economy’s health, and represents the value of all goods and services produced in the US. GDP has been positive since the third quarter of 2009, but today’s report, although better than expected, really can’t be considered more than moderate growth. Consumer spending increased at a 2% pace. Business investment fell by 1.3% in the third quarter, subtracting 0.1 percentage points from growth. Farm inventories dropped due to the drought and that subtracted 0.4 percentage points from GDP growth. Government spending increased 3.7%, with the lions’ share coming from the federal government and a fairly flat spending pattern from local governments. Investment in the housing sector jumped 14.4%. Inflation as measured by the Consumer PCE or Personal Consumption Expenditures Index increased to 1.8% from 0.7% in the second quarter; most of that increase was due to high gasoline prices, which have started moving lower in the current quarter. Imports dipped …

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Thursday, October 11, 2012 – The Bigger Debate

by Sinclair Noe DOW – 18 = 13,326SPX +0.28 = 1432NAS – 2 = 304910 YR YLD – .02 = 1.67% OIL + 1.22 = 92.47GOLD + 4.60 = 1768.00SILV +.06 = 34.10PLAT + 4.00 = 1682.00 Archived audio at http://www.moneyradio.com/Audio-Archive A fairly remarkable thing happened today. I doubt you’ll hear much of it on the nightly news because after all, there is a big debate this evening, but the news out of Tokyo this morning centered around and even bigger debate. The International Monetary Fund and the World Bank are holding their annual meeting in Japan and the Managing Director of the IMF, Christine Lagarde announced that the harsh austerity measures that European monetary officials have been pushing could produce the opposite effect on struggling nations like Greece and Spain and Portugal and Ireland. In other words, austerity has not worked and it probably isn’t the solution to Europe’s problems after all. For those of you that have been alert and attentive, you know that Euro-crisis has served as the testing ground for major economic theory. The IMF announcement today marks a dramatic turning point moving forward, or at least it marks a dramatic sounding announcement and a surprising admission of policy failure. Still to be determined is how the Euro-crisis plays out from here. Large parts of the Euro-zone are now in economic depression that threaten not just the weak nations but even the strongest. We are familiar with the situation in Greece; unemployment is running at 25%; the …

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Wednesday, October 10, 2012 – Great Fun and Very Entertaining

Great Fun and Very Entertaining -by Sinclair Noe DOW – 128 = 13,344SPX – 8 = 1432NAS – 13 = 305110 YR YLD – .03 = 1.69% OIL – 1.04 = 91.35 GOLD – 1.30 = 1763.60SILV +.08 = 34.08 PLAT – 13.00 = 1678.00(to listen to audio visit Financial Review at MoneyRadio.com) It’s earnings season. Chevron took a hit after announcing third quarter earnings would be substantially lower. Alcoa took a hit because law suits and remediation costs are part of their business model and not one time exclusions. FedEx announced it will fire workers and park planes to cut $1.7 in expenses. S&P cut Spain’s sovereign credit rating to BBB-minus, just a notch above junk status. Less than 4 weeks to the election. Tomorrow we can watch the vice-presidential debate. It’s all great fun and very entertaining. Last week, the first presidential debate produced a bump in the polls for Romney. The latestPew Research Center poll shows Mitt Romney ahead of President Barack Obama among likely voters, 49% to 45%. But the latest Gallup poll shows President Obama leading Romney among likely voters, 50% to 45%. If you’re wondering about the discrepancy, the reason is simple. The Pew poll covered the days immediately following last Wednesday’s presidential debate, but it didn’t include last weekend. The Gallup poll, included the weekend and that means it also included Friday’s September’s jobs report which showed unemployment down to 7.8 percent for the first time in more than three years.Romney got a bump …

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Friday, September 28, 2012 – Eat Cake

Eat Cake by Sinclair Noe DOW – 48 = 13,437SPX – 6 = 1440NAS – 20 = 311610 YR YLD un = 1.64%OIL + .25 = 92.10GOLD – 6.50 = 1772.10SILV – .17 = 34.59PLAT + 13.00 = 1669.00 There are bad things and they are bad. There are good things and they are good, even though the bad things are bad. Let me give you an example; You probably know I’m not a fan of the Federal Reserve. I believe there are better ways to conduct monetary policy. This does not mean the Fed’s monetary policy doesn’t work. You’ve heard the old adage, “don’t fight the Fed”. In case you haven’t noticed, the stock market has doubled in the past 3 1/2 years. That’s good, even though the bad things about the Fed remain bad. And the stock market has been performing much better than seems possible. As the third quarter comes to an end you might think about the problems in Europe and the slowdown in China; you might think about the slowdown in the US with the economy growing at an anemic 1.3% pace, the seemingly never ending housing recovery, the interminably high unemployment; and you might think of the looming fiscal cliff and the dysfunctional political bickering as corrosive elements sucking the life blood out of the economy; and you might think the best investment opportunities are in freeze dried foods and concrete bunkers – but no. The stock market has been sweet. The S&P 500 …

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Wednesday, September 26, 2012 – A Funny Thing Happened on the Way to the Forum – Not Funny HaHa

A Funny Thing Happened on the Way to the Forum – Not Funny HaHa by Sinclair Noe DOW – 44= 13,413SPX – 8 = 1433NAS – 24 = 309310 YR YLD – .06 = 1.62%OIL +.23 = 90.21GOLD – 7.30 = 1754.30SILV +.25 = 34.09 PLAT+9.00 = 1641.00 Did you hear the one about the bank’s prop trading desk. This will have you laughing out loud, it is a real side-splitter.Well, not so much a slap your knee kind of joke, not a real hearty guffaw, but more like a giggle, more like a hahahaha kind of joke. So this trader for Morgan Stanley, just a tyro, he walks onto the trading floor and he’s talking to his more experienced colleagues. They told him the banks misreported the Libor rates in away that would generally bring them profits. The kid said he was unaware of that, as he was relatively new to financial trading. The old, battle scarred traders laughed the kid off the trading floor. Libor fraud: More fun than a barrel of monkeys. And then Bloomberg reports on new emails from RBS traders reading: “Our six-month fixing moved the entire fixing, hahahah.” Haha, haha indeed. Libor fraud: Grins and giggles since the turn of the millennium. We keep getting all this information that Libor fraud was an ongoing and well-known, in your face fraud. And yet, nobody goes to jail. It is funny. Not in a laughing funny kind of way, but in a strange, nauseating, disgusting funny …

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Tuesday, September 25, 2012 – Fed Good at Growing Inequality

Fed Good at Growing Inequality by Sinclair Noe DOW – 101 = 13,457SPX – 15 = 1441NAS – 43 = 311710 YR YLD -.04 = 1.68%OIL – .51 = 90.86GOLD – 3.90 = 1761.60SILV – .23 = 33.84PLAT + 8.00 = 1634.00 Let’s start with a few economic reports. Case Shiller’s Index of existing home sales posted a 1.6% increase in July; all 20 cities in the index saw housing prices rise; it’s the fourth month of price increases, and the past 12 months are now showing increases. This is very positive news for housing. Pricesin Phoenix gained 2.2% to take the year-on-year increase to 16.6%, by far the strongest advance of any major metropolitan area. Los Angeles saw a 1.3% gain, and the year-over-year comparison has now turned positive by 0.4%. The consumer-confidence index increased to 70.3 in September, the highest level since February. Generally when the economy is growing at a good clip, confidence readings reach at least 90. September expectations increased for employment and business conditions, while consumers’ views on the present situation also rose. One of the big factors affecting the optimistic outlook is the turn in the housing market.  In August, the dividend-reinvested S&P 500 was up some 18% year-on-year. The combination of positive returns on stocks and real estate hasn’t been this good since 2006. Any economic gains are still fragile but you take whatever positives you can find. Both consumer-confidence measures, the one conducted by the University of Michigan and the one done …

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Wednesday, August 1, 2012 – The Fed’s Gone Fishing – The Machines Take Control – The Check is in the Mail

The Fed’s Gone Fishing -The Machines Take Control – The Check is in the Mail-by Sinclair NoeDOW – 37 = 12,971SPX – 4 = 1375NAS – 19 = 292010 YR YLD +.05 = 1.54%OIL + .71 = 90.38GOLD – 14.80 = 1601.10SILV -.56 = 27.54PLAT – 20.00 = 1403.00The economy has slowed down over the past few months; I know it; you know it; the Federal Reserve knows it; anybody who can fog a mirror knows it. And so, it was widely anticipated the Federal Reserve would acknowledge the slowdown today as they wrapped up a two-day FOMC meeting. They did. They issued a statement saying:  “economic activity decelerated somewhat over the first half of this year. Growth in employment has been slow in recent months, and the unemployment rate remains elevated.” And then they did absolutely nothing. The did not extend their Zero Interest Rate Policy into the next millennium and beyond; they did not cut the interest they pay member banks for not making loans; and they did not announce another round of quantitative easing. Nobody seriously expected QE3 but it was expected the Fed would make some small, incremental concession. Nope. They did nothing. Squat, zilch, zip, nada. They couldn’t even throw a dog a bone. Generally they expect inflation to be under control and employment to slowly improve just a smidge, and apparently Bernanke is going trout fishing in Wyoming. They promised to keep an eye on things; if it goes to hell in a handbasket, they’ll …

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Monday, July 23, 2012 – There Are Problems With Spain And Greece And Germany

There Are Problems With Spain And Greece And Germany – by Sinclair NoeDOW – 101 = 12,721SPX – 12 = 1350NAS – 35 = 2890 10 YR YLD – .02 = 1.44%OIL + .10 = 89.81GOLD – 7.30 = 1577.70SILV -.27 = 27.16PLAT – 17.00 = 1404.00There are problems with Spain. We’ve been talking about the problems for quite some time; they had a housing crash; a whole bunch of real estate is underwater; the banks were clobbered; the unemployment rate jumped up to more than 25%, which is in line with unemployment during the Great Depression. The IBEX 35, the Spanish equivalent of the Dow Industrials finished the day down 1.1% after trading as low as -5.8%, and the FTSE MIB (Italian index) was down 2.76% on the day. Spain announced that it is banning all short selling for the next three months. Italy announced it would ban short selling for banks and insurers.  The move echoes decisions in August last year by the two nations plus France and Belgium after European banks hit their lowest levels since the credit crisis of 2008 and 2009. The ban worked, sort of; the IBEX rose 6% last year during the ban, and the financial stocks that were covered under last year’s ban they gained 10%. Most bank stocks extended their decline once the bans were lifted. Last time around it didn’t really have any lasting impact. They artificially propped up prices but they didn’t correct the underlying problems. This is trying to avert hedge …

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Friday, July 20, 2012 – Why Hasn’t Anything Been Fixed on Wall Street?

Why Hasn’t Anything Been Fixed on Wall Street?  -Sinclair NoeDOW – 120 = 12,822SPX – 13 = 1362NAS – 40 = 292510 YR YLD -.05 = 1.46%OIL – 1.14 = 91.83GOLD + 2.30 = 1585.00SILV +.05 = 27.43PLAT – 3.00= 1421.00For quite some time it has been accepted that Greece was toast; the Greeks would be forced to swallow the bitter pill of austerity; somehow the Euro-union would survive. And the EU seemed to be dealing with the meltdown of Ireland and Portugal as well; they just forced them to pay for their own bailouts; that plan isn’t working out so well with Spain. The Kingdom of Spain was supposed to be the firewall where the breakdown of the Euro-union stopped; that plan isn’t working our so well. The problem today is Valencia, a region of Spain, not the orange; they are asking for a $22 billion dollar bailout; apparently in addition to the $123 billion dollar assistance package that is going to bailout Spanish banks and backed by the Spanish citizens, at least theoretically. May be good for the banks but the Spanish economy is still in a downturn and the government says it will step up austerity measures.Spain’s IBEX stock index fell 5.8 percent, its biggest one-day drop in two years, and the risk premium on government debt hit a euro-era high as its borrowing costs rose to 7.32 percent. That yield is above the 7 percent threshold considered unsustainable, with little relief in sight. And that is …

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Friday, June 1, 2012 – Someday the Violence Will End – by Sinclair Noe

DOW + 93 = 12,554SPX + 10 = 1325NAS +  27 = 285810 YR YLD -.02 = 1.64%OIL – .47 = 84.35GOLD + 6.20 = 1595.70SILV -.06 = 28.63PLAT – 10.00 = 1437.00 For the week, the Dow advanced 3.6 percent, the S&P 500 rose 3.7 percent and the Nasdaq jumped about 4 percent. It was the best percentage weekly gain for all three indexes since December. President Obama held a White House press conference this morning. The initial focus of the prepared remarks dealt with the European economic problem, not a Euro-debt crisis as the president noted. Obama went on to talk about the US economy and a few other issues. Obama tried to explain how the European economic problems could impact the American recovery and pushed Congress to pass parts of his “to-do” list aimed to stimulate economic growth. But during a question and answer session, the president said the private sector is “doing fine,” and he referenced the importance of jobs losses in the public sector. Mitt Romney criticized him for being “out of touch,” and so Obama backtracked and said the economy is not doing fine and he said: we’ve actually seen some good momentum in the private sector… record corporate profits…so that has not been the greatest drag on the economy.” He once again pressed Congress to provide aid to states to employ public sector workers including teachers and provide small businesses with tax breaks to help rejuvenate a sluggish recovery. Of course that isn’t …

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Tuesday, June 5, 2012 – Waiting for Euro-Failure – by Sinclair Noe

DOW + 26 = 12,127 SPX + 7 = 1285NAS + 18 = 277810 YR YLD +.03 = 1.56% OIL – .23 = 83.75GOLD – 1.40 = 1617.90SILV +.27 = 28.63PLAT + 10.00 = 1444.00 So, the G-7, the Group of 7 countries conferred on the Euro-zone’s debt crisis; Spain announced it was losing access to credit markets; the situation appears bad. So, the G-7 finance chiefs came riding to the rescue. And they achieved almost zero. Spain had a real estate bubble. Spanish banks are loaded down with bad debt. The premium investors demand to hold its 10-year Spanish debt over the German equivalent hit a euro era high last week on concerns it will eventually have to take a Greek-style bailout. Today, Spain’s treasury minister said Spanish banks should be recapitalized through European mechanisms, in other words the Spanish banks need a bailout and Spain can’t bail them out; this was a significant departure from the previous government line that Spain could raise the money on its own. And then Spanish government sources said ehhh, we’re not sure about a bailout. And the G-7 did almost zero. Observers of the G-7 conference say that there was talk about a bigger solution, a bigger response from the politicians in the form of a stronger economic union; and the talk was that it would probably take a few months to figure it out, maybe a few years; and it doesn’t look like there is a quick fix. The ECB holds …

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Monday, June 4, 2012 – Euro-crisis Moving Faster

DOW – 17 = 12,101SPX +0.14 = 1278NAS + 12 = 276010 YR YLD +.06 = 1.53%OIL +.15 = 84.13GOLD – 8.00 = 1619.30SILV – .42 = 28.36PLAT – 19.00 = 1434.00 Finance chiefs of the Group of Seven leading industrialized powers will hold emergency talks on the euro zone debt crisis tomorrow. The economic problems have spread and the G-7 teleconference is at least an admission that the euro is breaking down as a viable economic undertaking. We are finally moving past denial. There’s something rotten in Denmark; the Danish central bank cut interest rates twice last week; they say they’re battening down the hatches for a splintering of the European Monetary union. The European Commission said monetary union was in danger of “disintegration” and the European Central Bank said it was “unsustainable” as constructed. Felipe Gonzalez,the former Spanish prime minister says the Spanish economy is facing a “total emergency”, which is – just guessing here – a bit more problematic than a partial emergency. The Cypriot banking system is nine times the country’s GDP and they are now begging for a bailout. What a shocker. Cyprus is on the verge of becoming Iceland South. Switzerland is threatening capital controls to repel bank flight from Euroland. The Swiss two-year note has fallen to -0.32%; if you want to park money in the safe haven of Swiss bonds, you pay for the privilege. US 10-year note yield dropped down to 1.44%, lower than during the Great Depression. The United States …

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Wednesday, May 30, 2012 – Spanish Winter, Mexican Spring – by Sinclair Noe

DOW – 160 = 12,419SPX – 19 = 1313NAS – 33 = 283710 YR YLD – 0.11 = 1.62%OIL – 3.38 = 87.38GOLD + 7.70 = 1563.50SILV +.05 = 28.03PLAT – 28.00 = 1406.00 Yesterday the Dow gained 125 and I said: “The reason du jour for today’s market gains: positive news regarding Greece. Really? I’m not buying it. Make up your own reason for today’s gains because we are just as likely to see declines tomorrow.” And sure enough. The problem du jour was Spain and the Dow dropped 160. This economic stuff is easy. Remember when I told you a couple of months ago to get out in May? The S&P 500 has fallen nearly 6 percent in May, heading for its worst monthly performance since September. You’re welcome. The Nasdaq is down 6.9% for the month. US Treasury benchmark yields fell to their lowest in at least 60 years. Oil dropped more than 3 percent to the lowest level in nearly six months; oil prices are down 16% in May. The dollar remains the cleanest shirt in the dirty laundry hamper, up 5.5% for the month. The euro dropped below $1.24 to a 23-month low. Spain’s stock market hit a 9 year low. Yields on 10-year Spanish bonds topped 6.6%, which is close to levels at which Ireland and Greece sought international bail-outs. The news from Europe was all Spanish overnight as the country struggles to find traction on any plan that will lead it away from the …

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Thursday, May 17, 2012 – Banks Start to Run – by Sinclair Noe

DOW – 156 = 12,442SPX – 19 = 1304NAS – 60 = 281310 YR YLD -.06 = 1.70%OIL +.17 = 92.73GOLD + 34.00 = 1575.30SILV +.78 = 28.15PLAT + 19.00 = 1459.00 The Dow Industrials have now dropped for 11 out of the past 12 trading sessions, giving back all the gains going back to the start of the year. Greece’s caretaker Cabinet was sworn in this morning and they’ll hold power at least until next month’s election.  The European Central Bank has stopped providing funds to Greek banks. People have been pulling euros out of the Greek banks, concerned about a possible exit from the Euro-zone common currency and a return to the Drachma, which would be an effective devaluation. So Greek citizens take their money out the front door of the bank and the ECB refuses to replenish supplies, and something has to give. There will be an election in about one month. There will be attempts to find a resolution. German Chancellor Merkel is even considering lifting the jackboot of austerity from the necks of the Greeks. It is one thing to demand fealty, it is another to consider the very real possibility of a Greek exit from the Euro-union. Germans are starting to realize that a Greek exit from the Euro-union will be very expensive. Everybody is now doing a study to determine how much a Greek exit might cost; the numbers seem to run in the trillions. So, why not find a cheaper solution? Which …

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Wednesday, May 9, 2012 – Greek Government, Spanish Banks, Gold Prices – It’s All Messy

DOW – 97 = 12,835SPX – 9 = 1354NAS – 11 = 293410 YR YLD unch = 1.84% OIL – .56 = 96.45GOLD – 15.40 = 1590.40SILV – .20 = 29.37PLAT – 12.00 = 1505.00 The Greek tragedy continues; no success so far in negotiations to form a coalition government after weekend elections resulted in a deadlock. It looks like there might be another election in June. The Greeks accepted another $5 billion dollar bailout payment today, so they keep the government afloat for a few more weeks. Now, the chatter is shifting to the very real idea that Greece will exit the Euro, and trying to figure out the implications. The concern is that exiting the Eurozone is going to be impossible and possibly will trigger a cascade of bad economic consequences. Absolutely right, but only because it might be done in an uncontrolled manner. The Federal Reserve and the ECB and the IMF and all the others have been saying that the Euro-crisis is under control. If, or when Greece exits the Euro, nobody should be surprised; this train has been rolling down the track for a couple of years, and the Germans and ECB and IMF and Fed all had plenty of time to come up with solutions. And they didn’t. So, now the Greek voters have come up with a solution. They didn’t come up with a unanimous decision, not even a plurality. The whole thing was a crazy mish-mash of votes, ranging from communists to …

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Monday, April 30, 2012 – The Euro is Actually Kind of Important – Corporate Campaign Bribery – OWS Comes out of Hibernation

DOW – 14 = 13,213SPX – 5 = 1397NAS – 22 = 304610 YR YLD – .02 = 1.91%OIL -.07 = 104.80GOLD + 1.50 = 1665.30SILV – .26 = 31.11PLAT – 4.00 = 1574.00 A sharp drop in an index of Midwestern manufacturing and a slowdown in U.S. consumer spending last month added to worries that the U.S. economy is slowing down. Weaker earnings reports from health insurer Humana and the owner of the New York Stock Exchange, NYSE Euronext. The losses were broad. Nine of the ten industry groups in the S&P 500 fell, led by materials. Only telecoms rose. The Spanish government said that country’s economy shrank 0.3 percent in the first three months of the year, the second straight quarter of contraction. Spain is the fourth-largest economy among the 17 countries that use the euro. The worry is that Europe’s bailout funds won’t be big enough to rescue Spain if it needs help. Ratings agency Standard & Poor’s downgraded Spain’s government debt to just three notches above junk Friday. Earlier today, S&P lowered its rating for 11 Spanish banks, which are loaded with bad debt from a collapsed housing market. The good news is the euro hasn’t collapse, at least not yet. Somehow, the countries of the European Union continue to overcome their varied self-interest and they seem to do just enough to avoid catastrophe, at least for now. One reason the Euro still exists is because it is more than a monetary union, it is also …

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Friday, April 27, 2012 – Falling Down: US GDP, Spain, & Romania

DOW + 23 = 13,228SPX + 3 = 1403NAS + 18 = 306910 Yr yld -.03 = 1.93%OIL +.26 = 104.81GOLD  + 5.70 = 1663.80SILV + .18 = 31.37PLAT + 4.00 = 1579.00 This week was the best week in about one month for the major stock averages. Amazon climbed 15.7 percent to $226.85 and contributed half of Nasdaq’s gain for the day. The S&P retail index rose 3.5 percent and hit an all-time high. Shares of Expedia, the Web-based travel provider, surged 23.5 percent to close at $40.31, after hitting a new high at $43 on record volume. Growth in S&P 500 earnings rose to 7.2 percent this week from 3.2 percent at the start of the month. About 73 percent of the companies that have reported so far have beaten expectations. Earlier this week, a blowout quarter from Apple Inc gave the Nasdaq its best day of the year .  The S&P 500 is up 11.6 percent for the year.  Pay no attention to the Commerce Department report behind the curtain of the Wall Street indices.  The report says the U.S. economy expanded at a 2.2 percent annual rate in the first quarter, far below expectations for growth of 2.5 percent. Growth of 2.2% is mediocre, but it’s worse than that once you peel away a few layers — about a fourth of the growth in gross domestic product was accounted for by a buildup in inventories, and half of it came from the building and selling of motor vehicles. …

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Thursday, April 26, 2012 -Home Sales Up, Expectations Up; Beard on Beard Violence; Spain Sinks; Draghi’s Pretzel Logic; Big Banks Payday Tactics

DOW + 113 = 13,204SPX + 9 = 1399NAS + 20 = 305010 YR YLD -.02 = 1.96%OIL – .50 = 104.05GOLD + 12.80 = 1658.10SILV + .38 = 31.19PLAT + 16.00 = 1574.00 The number of people seeking U.S. unemployment benefits last week was 388,000; basically unchanged from a week earlier. The National Association of Realtors’ pending-home-sales index rose 4.1% to 101.4 in March. March pending home sales were up 12.8% from year-ago levels. A sale is listed as pending when the contract has been signed but the transaction has not closed. Sales of existing homes during the first quarter were the strongest in five years, and the NAR said the pending home sales data suggests the second quarter will be equally good. Pending sales are now at a 23 month high. We told you there would be a push to stimulate the economy by way of the housing market. It probably started with Operation Twist, and the Fed buying mortgage backed securities, and then continued with the push for HARP 2.0. We had a plethora of earnings reports today. Pulte Homes posted a smaller than expected loss. Citrix Software posted a better than expected profit. Amazon.com reported better than expected earnings even though profit dropped 35% from a year earlier. Of the 51% of the S&P 500 companies that have reported first-quarter results so far, 72.4% have reported earnings above expectations, 11.8% reported earnings in line with expectations and 15.7% reported earnings below estimates. It’s all about expectations. …

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