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December, Monday 19, 2011

DOW – 100 = 11,766SPX –14 = 1205NAS – 32 = 252310 YR YLD -.04 = 1.81%OIL +.47 = 94.00GOLD – 5.30 = 1594.90SILV -.94 = 28.90PLAT –9.00 = 1413.00 The ratings agencies have been busy over the past few days – better late than never, I suppose. Fitch put Belgium, Spain, Slovenia, Italy, Ireland, and Cyprus on its negative watch list. Moody’s cut Belgium’s credit rating by two levels. Standard & Poors is expected to cut France’s credit rating this week. Fitch says a solution to the Eurozone crisis is “technically and politically beyond reach.” And credit downgrades make a solution fall even further out of reach. For any borrower – corporation or country – the worse the credit rating, the higher the interest on a loan is likely to be.For many Eurozone countries, they are having a hard time paying their debt right now; if interest rates move higher, it just increases the probability of default. It is a vicious cycle; deteriorating credit leads to higher interest rates and additional costs, which over time further damage the country’s credit rating. Another potential problem area is interbank lending might freeze up. Banks constantly have to borrow money from each other for a day or two because the balance between loans and money on hand is constantly shifting. But when banks begin to worry about possible losses on Eurozone bonds at other institutions, they may refuse to lend money overnight. Short-term money gets frozen in place. The European Central Bank …

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December, Friday 16, 2011

DOW – 2 =11,866SPX +3 = 1219NAS +14 = 255510 YR YLD -.06 = 1.85%OIL +.08 = 93.95GOLD +28.60 = 1600.20SILV +.46 = 29.84PLAT +14.00 = 1427.00 The Irish economy shrank 1.9% in the third quarter. The news on the declining Irish GDP comes as legal advisers are preparing a draft of a referendum on whether Ireland wishes to remain in the Eurozone.  Any deal to keep Ireland in the European Union would likely result in at least a decade of austerity. Countries with a debt-to-GDP ratio of over 60 per cent would agreed to reduce their debt by 5 per cent each year – a clause which would force Ireland, with a debt-to-GDP ratio of around 90 per cent, to take billions more out of each Budget for the medium-term future. Eurozone leaders have been talking up Ireland as a shining example of how you can combine austerity with membership of European Monetary Union and still get growth. So much for the Irish miracle. The National Institute for Statistics and Economics says France’s GDP will contract by 0.2% in the fourth quarter and shrink 0.1% in the first quarter of next year. A different report is forecasting Italy’s economy will shrink by 1.6% in 2012. Toss in Portugal, Greece, and Spain and it is pretty obvious that Europe is now in a recession. Three top US officials testified before Congress this morning on the Euro Crisis. New York Federal Reserve Bank President William Dudley, Treasury Deputy Assistant Secretary for …

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December, Thursday 15, 2011

DOW +45 = 11868SPX +3 = 1215NAS =1 = 254110 YR YLD +.01 = 1.91OIL –1.52 = 93.43GOLD – 5.90 = 1571.60SILV +.32 = 29.38PLAT-16.00 = 1409.00 The war is over. Everything that can be said about this tragedy has been said, many times over. Nevertheless, it seems appropriate to note the officially announced end of the war. After nearly nine years, 4,500 American dead and 32,000 wounded, and a price tag of approximately $3 trillion dollars, the war in Iraq is officially over. The death toll for Iraqi combatants and civilians is somewhere between 100,000 and one-million. Defense Secretary Leon Pannetta said today: “We spilled a lot of blood there, but all of that has not been in vain. It’s been to achieve a mission making that country sovereign and independent and able to govern and secure itself.” I never quite understood the mission in Iraq; the troops did their job; they did everything they were asked to do and more, but I’m not sure the mission was ever truly clear. But it’s over now. No pronouncement of victory, no cheers. There will still be about 150 American soldiers and there will be about 5,000 private security contractors and 16,000 State Department employees working around the US embassies. So, the war may be over but the work is unfinished. And what about the spoils of war? Exxon Mobil and Royal Dutch Shell were awarded early contracts to develop oilfields but there has been very little investment from other American …

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December, Wednesday 14, 2011

DOW –131 = 11823SPX –13 = 1211NAS –39 = 253910 YR YLD -.06 = 1.90%OIL –5.32 = 94.82GOLD –54.40 = 1577.50SILV –1.88 = 29.06PLAT – 53.00 = 1429.00 Last Friday the Europeans held a summit in Brussels and they announced a big plan to create a new Eurozone that would be a bit more fiscally responsible; they did not announce a massive bailout; there was no bond buying bazooka. Yesterday, the Federal Reserve held their final FOMC meeting for the year; they left interest rates at zero but they did not announce QE3; there was no plan for Ben Bernanke to fly his helicopter over Wall Street and toss out free cash for the holidays. Have the central bankers suddenly found fiscal discipline? Don’t hold your breath. The central bankers will do what the central bankers always do; they will print and spend staggering amounts of money that they don’t have; and they won’t tell you about it. Actually, they did tell us, very quietly and obscurely. Yesterday, I told you about a statement issued by the Bank of International Settlement, the central bank for central bankers. The BIS said it would “supply official liquidity in major currencies in an elastic manner.” The response to a deflationary depression is to inflate. And the big dog of bailouts is the Federal Reserve. So it should come as no great surprise that the dollar needed to get a little stronger. The only things going up in the past week – the dollar …

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December, Tuesday 13, 2011

DOW – 66 = 11954SPX –10 = 1225NAS –32 = 257910 YR YLD -.05 = 1.96%OIL +2.59 = 100.36GOLD –34.40 = 1631.90SILV -.45 = 30.94PLAT – 14.00 = 1477.00 A quiet day on the European front. I ran across an interesting statistic from the Bureau of Labor Statistics. You’ve probably heard that the Germans and the French are upset with the prospect of bailing out the Greeks and the Italians. Usually the narrative is that the industrious Germans don’t want to support the lazy lifestyle of the Italians. Turns out the Italians work approximately 25% more hours per year than the Germans and 24% more than the French. No word on the Greek work schedule. I’ve been saying the Euro Crisis will likely follow the Federal Reserve Playbook. There was confirmation of this on Sunday. A small, unobtrusive report issued by the Bank of International Settlements endorsing coordinated action by the world’s largest central banks to ease funding conditions for banks.  The BIS said: “A freezing of interbank markets in major funding currencies, as during the recent crisis, may require the ability to supply official liquidity in major currencies in an elastic manner.” Allow me to translate for you: The BIS is saying the plan is to print lots and lots of cash to prevent a modern day run on the banks. Now, the next logical question: who is the Bank of International Settlements? The BIS is a bank for the central banks, and it is not accountable to any …

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December, Monday 12, 2011

DOW –162=12,021SPX –18 = 1236NAS –34 = 261210 YR YLD -.04= 2.01%OIL –1.53 = 97.87GOLD –46.00 = 1666.30SILV -.94 = 31.39PLAT – 27.00 = 15.06.00 You remember on Friday, the big Euro Summit in Brussels resulted in a feel good day for the markets, although I’m still not sure why. Twenty-six of the 27 European Union leaders on Friday agreed to pursue stricter budget rules for the single currency area and also to have euro zone states pay up to $267 billion in loans to the International Monetary Fund (IMF) to help tackle the crisis. England backed out of the deal. Today, French President Nicolas Sarkozy said: “You have to understand this is the birth of a different Europe – the Europe of the euro zone, in which the watchwords will be the convergence of economies, budget rules and fiscal policy. A Europe where we are going to work together on reforms enabling all our countries to be more competitive without renouncing our social model.” Which is another way of saying they will try to make a Eurozone that is subject to sanctions by a board of economic technocrats who have the power to reject or accept national budgets even though they are not elected officials. And there is still the nagging little problem that this setup might not be legal. To which Sarkozy responded: “In the next fortnight, we will put together the legal content of our agreement. The aim is to have a treaty by March.” An EU diplomat …

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December, Friday 09, 2011

DOW +186 = 12,184SPX +20 = 1255NAS +50 = 264610 YR YLD +.08 = 2.05%OIL +1.47 = 99.80GOLD +5.50 = 1712.30SILV +.57 = 32.33PLAT + 20.00 = 1519.00 The European Union has come up with an economic treaty for 26 Euro nations. The UK did not sign on. The new treaty replaces the old treaty. The new treaty is supposed to require stricter fiscal and financial discipline in future budgets. The New Euro will pump hundreds of billions into the IMF and the Euro Stabilization Mechanism, and the ECB, and there will be more printing of money. And I am more convinced it is straight out of the Federal Reserve Playbook, with subtitles. So let’s review the playbook. I talked about this yesterday, but it deserves a little more attention today: the Government Accounting Office conducted an audit of the Federal Reserve, the first independent audit of the Fed in its 99-year history. The audit dealt with emergency measures conducted by the Fed and it was NOT a complete audit of all Fed functions, but the GAO produced a 251-page report. If you want a link to the report, then drop me an email and I’ll send you the link. http://www.gao.gov/new.items/d11696.pdf The report documents that Wall Street Bailouts by the Fed dwarf the $700 billion TARP, and everything else you’ve heard about. Page 131 – The total lending for the Fed’s “broad-based emergency programs” was $16,115,000,000,000. That’s right, more than $16 trillion. The four largest recipients, Citigroup, Morgan Stanley, Merrill …

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December, Thursday 08, 2011

DOW –198 = 11,997SPX – 26 = 1234NAS – 52 = 259610 YR YLD -.05 = 1.97%OIL –2.50 = 97.98GOLD –37.30 = 1706.80SILV .85 = 31.76PLAT –30.00 = 1498.00 We start with Europe. The European Central Bank, the ECB, cut interest rates by a quarter percentage point to 1 percent, matching a record low. They also loosened collateral rules so that banks can borrow more from the ECB and announced two unlimited three-year loans. ECB president Mario Draghi said the measures “should ensure enhanced access of the banking sector to liquidity.” Perhaps more important than what was said, was what was not said: The headline event today was that Draghi made it absolutely and explicitly clear that there would be no ECB bond buying bazooka. They’ll stay in the market but will only buy small amounts. It’s governments who’ll have to do the heavy lifting. In a separate speech, German Chancellor Angela Merkel confirmed the outlook by saying there will be no “big-bang” solution coming from the summit, which gets underway in Brussels tonight.  On the eve of this summit, the ECB started passing out, essentially, free money; making it easier for banks to borrow cash from the ECB. Credit claims such as bank loans will become eligible as collateral and the central bank reduced the rating threshold on asset-backed securities. This is the Euro version of cash for trash. The ECB also cut in half banks’ reserve ratio, which determines the amount of money they have to deposit with their …

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December, Wednesday 07, 2011

DOW +46 = 12,196SPX + 2 = 1261NAS –0.35 = 264910 YR. YLD. -.08 = 2.20% OIL -.73 = 100.55GOLD +13.70 = 1744.10SILV -.25 = 32.61PLAT +1.00 = 1533.00 (#1)(#2) A Day that will live in infamy. Under calm skies 70 years to the day of the attack on Pearl Harbor, about 120 survivors gathered this morning in Hawaii to mark the anniversary with ceremonies that began with a moment of silence for the 2,400 Americans who lost their lives. (#3)About half of the casualties were from the USS Arizona. For 24 of the survivors, it was their first time back to Pearl Harbor in the last 70 years. Today only 7 survivors of the Arizona attended the ceremony at Pearl Harbor. The ashes of Vernon Olsen, who was on the Arizona during the attack, were placed on his ship today. Today was the last day for such ceremonies; the Pearl Harbor Survivors Association announce that it would disband at the end of this month; the remaining members of the association are getting too old and are in poor health. (#4) Once again Europe is dominating the headlines and determining the direction of the markets. I had an email from a listener that gave a good summation: Sinclair, The EU leaders are now discussing a second bailout fund without even agreeing on how to fund the first one.  In either case, the amounts they are discussing are way too low.  They are going to need tens of trillions not billions. So far, the …

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December, Tuesday 06, 2011

DOW + 52 = 12150SPX + 1 = 1258NAS – 6 = 264910 YR YLD +.04 = 2.09%OIL +.21 = 101.20GOLD + 6.20 = 1729.40SILV +.68 = 32.86PLAT + 6.00 = 1532.00 The single most important thing you need to know today: The Green Bay Packers have offered 250,000 shares in the franchise for sale at $250 per share. They’ll use the money to make improvements to Lambeau Field. That brings the total number of shares outstanding to 5 million. The max you can buy is 200 shares. The shares are not traded on an open market. The shares don’t pay a dividend; the value doesn’t change; it is difficult to transfer shares, unless somebody dies or something – maybe it is a good investment. Our technical director, James Tidwell, a true cheesehead – tells me this is important. What else is going on in the world? Oh, Financial Armageddon, collapse, redemption, recovery, betrayal. Another quiet day. Let’s start with Financial Armageddon. It did not happen today. Despite the fact that Standard & Poor’s threatened to downgrade 15 European countries to negative outlook or actually cut their ratings or even call them bad dressers. The markets shrugged off the ratings agency threats like water off a ducks back. S&P pushed their point – they might downgrade the powerful countries of France and Germany. Yawn. Shrug. They might even downgrade the European Financial Stability Facility. Which was met with derision. Now, the markets seem to think credit downgrades are really nothing …

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December, Monday 05, 2011

DOW =78 = 12097SPX +12 = 1257NAS +28= 265510 YR YLD +.01 = 2.05OIL –3.16 = 97.80GOLD – 22.10 = 1724.20SILV – .56 = 32.18PLAT – 27.00 = 1526.00 Well, I survived. My apologies for missing our regular Friday get together. Throat and sinus. I survived. That is my segue to the situation in Europe. The Euro has survived. A couple of weeks ago, it looked like the end was near. The headlines warned of Financial Armageddon. I told you not to underestimate the strength of the bankers and the powers that be; I told you they were bright boys and girls and they had a game plan. But the financial markets wobbled. There was the threat that contagion would spread from Greece to Portugal to Italy to Germany to London to New York, and eventually right into your pocket book. The bankers cried ‘Havoc!” and let slip the dogs of debt. The bond vigilantes prowled the markets and pushed demands that the hoi poloi must pay the hoi oligoi; the great unwashed were indebted to the bankers; the demands were simple and constant from at least 3 years past: the profits were privatized but the losses must be socialized. The Greeks and Italians did not vote for the governments that now run their countries, just as we did not vote for the Federal Reserve and their grand bailout here in the US. Germany’s Merkel and France’s Sarkozy demanded change; apparently Sarkozy is too young to remember the definition of …

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December, Thursday 01, 2011

DOW – 25 = 12020SPX – 2 = 1244NAS + 5 = 262610 YR YLD +.05 = 2.12%OIL – .37 = 99.98GOLD – 4.10 = 1746.30SILV – .10 = 32.83PLAT + 5.00 = 1565.00 Today was a fairly quiet day in the financial markets; I guess that is to be expected the day after the central banks saved the world! With 24 hours to reflect, the world didn’t look particularly saved. Europe still looked like Europe. The head of the European Central Bank says the ECB stands ready to act more aggressively to fight Europe’s debt crisis; that script hasn’t changed in two years. Europe’s political leaders will meet next week to work on tighter budgets for the euro zone. They’ve been holding meetings next week for the past couple of years. The ECB can’t legally act as a lender of last resort, so the idea du jour  is to force individual countries’ central banks to make contributions to the International Monetary Fund and the IMF will serve as lender of last resort. Germany wants the European Commission to grant it power to veto other nations’ budgets; in other words, they want to hold a gun to the head of their euro zone partners; this is a business model that has not worked well in Europe. And I don’t know how it could work now. Is fiscal integration meant to involve some kind of democratic political control of fiscal policy? If so, one can only wonder what sort of voting …

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November, Wednesday 30, 2011

DOW + 490 = 12045SPX +51 = 1246NAS + 104 = 262010 YR YLD +.07 = 2.07%OIL +.71 = 100.50GOLD +34.00 = 1750.40SILV + .91 = 32.93PLAT + 21.00 = 1566.00 Who wants some free money? Anybody who wants some free money raise your hand and get in line. The Federal Reserve has teamed up with the European Central bank, the Bank of Japan, the Bank of Canada, the Bank of England, and the Swiss National Bank and they are handing out cash. Unfortunately, you probably won’t be getting any of this free cash, but Wall Street loves the idea of free money. Today’s announcement from the Central Banks actually involves lowering the cost of emergency U.S. dollar funding for banks and expanding currency swap lines between countries. So, the cash will go to the banks; the moves will reduce funding costs and improve liquidity. It’s not completely free money – it’s just a half off sale. The dollar market had been drying up; today’s move might help prevent a credit freeze. Maybe, maybe not. There is still a big problem of solvency. Many European countries still have unsustainable levels of debt. Many European banks have government assets on their books. There used to be an assumption that those assets were “riskless”; the idea was that Greek bonds or Spanish or Portuguese or Italian bonds were safe – backed by the European Union. Well.., it turns out they weren’t safe. And so the cash needed for day to day operations …

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November, Tuesday 29, 2011

DOW + 32 = 11,555 SPX + 2 = 1195NAS – 11 = 2515 10 YR YLD +.04 = 2.00% OIL + 1.29 = 99.50GOLD +5.50 = 1716.40SILV -.14 = 32.02PLAT – 4.00 = 1540.00 It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to heaven, we were all going direct the other way – in short, the period was so like the present period that comparisons would seem inevitable. In the eight decades before the recent depression, there was never a period when as much as 9 percent of American gross domestic product went to companies in the form of after-tax profits. Now the figure is over 10 percent. During the same period, there never was a quarter when wage and salary income amounted to less than 45 percent of the economy. Now the figure is below 44 percent. Corporate profits after taxes were estimated to be $1.56 trillion, or 10.3 percent of the size of the economy – the highest ever. Wage and salary income was only 43.7 percent of G.D.P., the lowest number for any period going back to 1929. Corporations …

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November, Monday 28, 2011

DOW +291 = 11523SPX + 33 = 1192NAS +85 = 252710 YR YLD -.01 = 1.96%OIL +.98 = 97.75GOLD +29.60 = 1710.90SILV + 1.08 = 32.16PLAT + 15.00 = 1549.00 Europe was totally copasetic, at least for today; I’ll get to the details in a moment. Here in the USSA, we spent the weekend doing what we do best, overeating and over-shopping. I want to start today with a news item that did not move the markets, but it is worth noting. A US District Judge in Manhattan actually stood up to Wall Street and refused to let the SEC sweep yet another case of high-level criminal malfeasance under the rug; the judge refused to let a major bank walk away with a slap on the wrist. There is a chance we could see actual justice, and the odds of that happening are so rare, the probabilities so astronomical – you are more likely to see a team of pink unicorns and Haley’s Comet. The SEC had brought an action against Citigroup for misleading investors about the way a certain package of mortgage-backed assets had been chosen. The case is very similar to the Abacus Case  involving Goldman Sachs, in which Goldman allowed short-selling billionaire John Paulson (who was betting against the package) to pick the assets, then told a pair of European banks that the “designed to fail” package they were buying had been put together independently.   This case was similar, but worse. Here, the SEC accused Citi …

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November, Wednesday 23, 2011

DOW – 236 = 11,257SPX – 26 = 1161NAS –61 = 246010 YR YLD -.06 = 1.88% OIL – 2.19 = 95.82GOLD – 7.10 = 1693.30SILV – 1.01 = 31.86PLAT – 23.00 = 1554.00 Today’s lesson is on basic supply and demand. Let’s say you manufacture widgets; and let’s say you produce 100 widgets and you have enough customers to sell all 100 widgets. Now let’s say that you start producing 1,000 widgets, even though your market hasn’t changed. What happens to the price of each widget? That’s right, the price of widgets goes down, and you might not be able to sell all the widgets you’ve produced. Yesterday the IMF said they would backstop European nations with loans up to 10 times their quota. Now imagine that you are a European nation trying to sell bonds and the IMF just announced that the supply of bonds might increase by 1,000%. What happens to the price of each bond? That’s right, the price of bonds goes down, and you might not be able to sell all the bonds you’ve printed. Germany held a bond auction this morning; they failed to get bids on 35% of the 10 year bonds that were offered for sale. The auction was basically a disaster. Germany is the strongest nation in Europe and if they have this kind of difficulty in raising capital then you have big questions about upcoming auctions in other Euro countries.  Wait a second; Germany has Europe’s strongest economy, and traders …

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November, Tuesday 22, 2011

DOW – 53 = 11493SPX – 4= 1188NAS – 1 = 252110 YR YLD -.02 = 1.94%OIL +.83 = 97.75GOLD +22.10 = 1700.40SILV + 1.13 = 32.87PLAT + 21.00 = 1571.00 The U.S. economy grew at a slightly slower pace than previously estimated in the third quarter. The Commerce Department issued its second estimate on Gross Domestic Product and they revised the growth down to 2.0% from the initial guess of 2.5% growth.The good news is that the fourth-quarter growth pace could exceed 3 percent, which would be the fastest in 18 months.The GDP report also showed inflation pressures subsiding. A price index for personal spending rose at a 2.3 percent rate in the third quarter, instead of 2.4 percent.The economy was pretty flat last quarter but banks racked up big profits – posting net income of $35 billion in the third quarter, the best performance in 4 years. The FDIC’s list of “problem” banks fell for a second straight quarter, declining to 844 from 865 three months earlier, the agency said. There were 26 bank failures in the three-month period that ended Sept. 30, bringing the year’s total to 74, compared with 127 a year earlier.It is an interesting juxtaposition; the economy slows but banks make big profits. There is no doubt the financial sector has a significant impact on the economy, what is less clear is the contribution financial services make to the real economy. There is a good chance that the value of financial intermediation services is …

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November, Monday 21, 2011

DOW – 248 = 11547SPX –22 = 1192NAS –49 = 252310 YR YLD -.05 = 1.96%OIL+.13 = 97.80GOLD –47.50 = 1678.30SILV – .77 = 31.74PLAT – 46.00 = 1556.00 The Super Committee is dead. The committee suffered from a deficit of common sense and patriotism combined with an excess of partisanship and dogma; the combination proved fatal. Of course, whenever there is a monumental failure in Washington DC, the politicians deny culpability and the taxpayers will be forced to pay. Any member of Congress facing a close race can breathe a sigh of relief now that the supercommittee has kicked the bucket. For Republican incumbents they don’t have to face the prospect of voting for tax increases; for Democratic incumbents they don’t have to explain cuts to social programs. That said, new candidates for office have also been given a gift. Congress’s approval rating is at record lows and the supercommittee’s failure only serves to underline the fact that those in office right now probably aren’t the ones who are going to fix the budget. The bottom line – they’re all a bunch of pathetic losers.  November 23rd is the official deadline for a deal, but today is the effective deadline since the Congressional Budget Office would need time to evaluate a proposed solution. Failure to reach a deal on deficit reduction would trigger $1.2 trillion in cuts over the next decade, beginning in 2013. Of course that leaves plenty of time to kill off parts that the politicians find onerous. If …

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November, Friday 18, 2011

DOW + 25= 11796SPX  -.0.48 = 1215NAS  – 15 = 257210 YR YLD +.05 = 2.01%OIL – 1.37 = 97.44GOLD + 4.70 = 1725.60SILV +.65 = 32.46PLAT + 10.00 = 1598.00 For the week, the Dow fell 2.9 percent, the S&P dropped 3.8 percent and the Nasdaq lost 4 percent. A major question has been whether the European Central Bank will find a way to act as a lender of last resort – essentially will they act like the Federal Reserve in 2008. Speculation has grown the ECB could lend money to the International Monetary Fund to bail out some euro zone members. Nothing today, but clearly this is the game plan moving forward. Quietly, The Swiss National Bank, that’s the Central bank for Switzerland, has imposed significant restrictions on its two biggest banks, UBS and Credit Suisse – forcing the banks to reduce risk and shrink, possibly selling off parts of the bank, and also forcing the banks to increase capital reserves perhaps by double.  Meanwhile, here in the USSA, we force our banks to do – umm – nothing. There’s an election in Spain on Sunday. Next week, we’ll wrap up third quarter earnings reports. Also, a shortened week because of the holiday, and then Thursday will be Black Friday – the start of the holiday shopping season, which actually started just before Labor Day. The Congressional SuperCommittee will need to have a deal in place by Monday, if they hope to meet their deadline on Wednesday.  If …

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November, Thursday 17, 2011

DOW – 134=11770SPX –20=1216NASDAQ –51 = 258710 YR YLD -.07 = 1.96%OIL –3.96 = 98.62GOLD –42.30 = 1720.90SILV –1.99 = 31.81PLAT –36.00 = 1588.00 I have been reading reports that masked youths clashed with riot police outside Greece’s parliament and the U.S. embassy. Thousands of austerity-weary Greeks marched through Athens in an annual commemoration of a bloody student uprising in the 1970s. The protest commemorates the squashing of a pro-democracy student uprising in 1973 by the military dictatorship that ruled Greece from 1967-74; just to jog your memory, the United States backed the military. Police fired tear gas and stun grenades to disperse the rioters. Some 28,000 people took part in the march, according to police estimates. About 15,000 people took part in a similar protest in the northern city of Thessaloniki that turned violent when a couple of hundred protesters threw projectiles and Molotov cocktails at police, who responded with tear gas. The demonstrations were the first test of public sentiment for the new technocratic government of Lucas Papademos. The yield on 10-year Italian bonds fell 17 basis points, or 0.17 percentage point, to 6.84 percent. The new technocratic Italian leader Mario Monti pledged urgent action to curb the nation’s deficit. And just as Italy seemd to be getting better, Spain seems to be getting worse. The 10-year Spanish yield climbed seven basis points to 6.48 percent, after reaching a euro-era record 6.97 percent. Spanish Prime Minister Jose Luis Rodriguez Zapatero called on the European Commission and European Central Bank …

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