DOW + 65 = 13, 279
SPX + 7 = 1405
NAS + 4 = 3050
10 YR YLD +.04 = 1.96%
OIL – .15 = 106.01
GOLD – 2.10 = 1663.20
SILV -.04 = 31.07
PLAT + 3.00 = 1577.00
The Dow Industrials hit the highest point since December 2007. Later this week we’ll have reports on retail sales and the big monthly jobs report on Friday. Today, the ISM reported their manufacturing index rose to 54.8% last month from 53.4% in March. The results were much better than anticipated. We may have hit a top in the stock market: Former Federal Reserve Chairman Alan Greenspan said U.S. stocks offer good value and are likely to rise as corporate earnings increase over time. “Stocks are very cheap,” Greenspan said today at the Bloomberg Washington Summit hosted by Bloomberg Link, citing “a very low price-earnings ratio. There is no place for earnings to grow except into stock prices,” I mean, when Greenspan speaks it must be a contrary indicator.
Today is the one year anniversary of the killing of Osama bin Laden. President Obama is in Afghanistan, and he’ll deliver a speech a little later.
Today is also May Day. Occupy Wall Street is back; trying to resurrect the movement with May Day marches, which gained momentum through the day. Protesters marched on banks, chanted anti-corporate slogans, and clashed with police in an opening day of sorts for the movement’s summer revival. In New York, hundreds of protesters gathered in Union Square. A crowd surged out of Washington Square Park carrying a banner that read “On Strike.” Officers shouted for protesters to remain on the sidewalk, but several protesters holding the banner stepped into the middle of Avenue of the Americas, where several officers — including one in plain clothes who had appeared to be marching with the crowd — tackled and arrested them. The most recent reports have about a half dozen people arrested.
The May Day demonstrations took place across the United States and around the globe. In the Bay Area in California, marches and protests snarled traffic and caused road closings. Hundreds marched through Oakland, temporarily closing streets and bank branches and clashing with officers in riot gear, who deployed tear gas on crowds. The Golden Gate Ferry service, used by many commuters from Marin County to San Francisco, was shut down after workers went on strike and picketed ferry terminals. The movement is not just in New York. In Montreal and Quebec, tens of thousands of students are on the march. In Spain, more than one million people recently protested in Madrid.
The morning started with the New York Police Department and the FBI raiding the homes of people suspected of being part of the Occupy movement. “Questions included things like ‘what are your May Day plans?’ ‘Do you know who the protest leaders are?’ ‘What do you know about the May Day protests?’ and such.”
In the early days of the movement when the number participating was small, it was overly aggressive policing that put them on the map. YouTube clips of women being pepper sprayed and arrests of people on Brooklyn Bridge went viral. Later arrests from a march across Brooklyn Bridge garnered more sympathy. An Iraq war veteran was critically injured in Oakland. Students at UC Davis were pepper sprayed as they sat in peaceful protest. The protesters weren’t always non-violent either. It remains to be seen whether the Occupy movement has the staying power to effect lasting change. In Egypt, they’d been organizing (in far more difficult conditions) for five years before they reached a tipping point. I think the movement will be heard from throughout the summer. And I think the losing side will be whomever resorts to thuggish tactics.
It has become pretty routine for local police to engage in thuggery and run roughshod over Constitutional protections in the name of maintaining order, which increasingly means not annoying big companies. With habeas corpus suspended, our own Attorney General maintaining the Administration has the right to kill suspected terrorists without a trial, and electronic surveillance ever on the rise, it might seem hard to get worked up about small suspensions of the right to make a political point in public. In Charlotte North Carolina, they are getting ready for the Democratic convention this summer. OWS should make both conventions exciting for a change. The Charlotte City Council has just passed some tough security rules, such as expanded ability to search and detain, for what is deemed an extraordinary event, such as the convention. So, local businesses Bank of America and Duke Energy persuaded the council to deem their annual shareholder meeting as extraordinary events. The ACLU is not happy, particularly since the city council never contemplated nor approved having shareholder meetings deemed “extraordinary events.” Notice how no one questions this use of public funds? This is all about demonstrating who really wields clout in the social order.
The NYPD is prepared for the resurgence of Occupy Wall Street protesters today, but Mayor Michael Bloomberg questioned the point of the protests. “If you want to change things, I don’t know what protesting does,” he said. “Why not try to go out and do something and make it better. Help kids get a better education. Start a business. There’s a lot of ways that you can volunteer and help make this city better and this country better.” Bloomberg doesn’t understand why these street protesters don’t just take a $10 million dollar severance package and start a terminal business dealing in bond data. What slackers.
Earlier today, Occupy Wall Street protesters gathered outside of News Corp’s headquarters in New York, chanting “Arrest Rupert Murdoch.”
A British parliamentary committee has issued a report that says Rupert Murdoch, the Chairman and CEO of News Corp. is “not a fit person to exercise the stewardship of a major international company” and condemned three former News Corp. executives for misleading British lawmakers over the depth of the company’s phone-hacking scandal. The report offers details of a cover-up the company allegedly carried out to contain the fallout from revelations that its now-closed News of the World tabloid illegally hacked mobile-phone voice mails. The report didn’t accuse Murdoch, or his son, News Corp. Deputy Chief Operating Officer James Murdoch, of misleading Parliament, (a possible but highly unlikely criminal charge), but the conclusions did say the father and son had presided over an affair that “demonstrates huge failings of corporate governance.”
The resolution committee of the failed Icelandic bank Old Landsbanki has subpoenaed the international auditing firm PriceWaterhouseCoopers, accusing the company of creating wrong annual accounts which misled the markets. The committee’s damages claim runs to hundreds of millions of kronur. No I can’t tell you what a kronur is worth these days. The claim is that the audits misled the markets about the strength of Landsbanki and ultimately resulted in greater losses in the Icelandic financial crisis than would otherwise have been the case.
As the Occupy Wall Street protesters take to the streets, the big banks continue to rack up gains. About two years ago, Bank of America tried to come up with ways to improve the bottom line; they gave their new (money-making) mission a special codename: Project New BAC. The answer was to reduce expenses. That’s banker-speak for cut jobs, and over the past year, BofA fired 30,000 people. Today, they announced they would fire 2,000 more. The shares were up 3.5% today.