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here's a data point for you, fed.
TAX DEFAULTS SOAR AS HOMEOWNERS STRUGGLE
By LOIS WEISS
NY Post
April 23, 2004 -- New York City homeowners appear to be on the verge of a meltdown.
While home sale prices and tax rates increased last year, the tax delinquency rate soared, according to a new report.
A Dept. of Finance spokesperson blames the uptick in homeowner delinquency on a mid-year rebilling plus a rate increase in the same bill. "It's confusion, not hardship," said Sam Miller. For Class I properties - one- to three-family homes - the number of delinquent parcels at the end of fiscal year 2003 (from July 1, 2002, to June 30, 2003) rose 50 percent to 137,578, while the amount owed increased 16 percent to $62.9 million. Comparing Class I delinquencies from March 31, 2003, to March 31, 2004 - stats not available in the report - the number of delinquent parcels rose to 81,543 from 127,581. The number of delinquent Class II condominiums, whose owners are responsible for their own taxes, increased to 15,688 in 2003 from 8,840 in 2002, going from a 3.3 percent delinquency rate to 4.6 percent. Another 3,000 condos in Class I were also delinquent, versus 1,907 the year before.
An 18.5 percent across-the-board tax increase became effective last year. City Hall is seeking a rebate, which needs Albany's OK.
"so why aren't semis doing better?"
hmm. well intel already told us how they're doing. so msft's news can't really rewrite intc's history, right?
plus, of course, msft isn't about buying semiconductors: its about leasing software. dell is about buying semiconductors; and they also preannounced an in-line quarter.
"Junk bond spreads are considered to be one of the best measures of sophsiticaed investor confidence and have been an excellent leading indicator of the stock market."
i can understand how that might be so when the economy is weak and the macro picture uncertain. but a strengthening economy and predictions of gdp at 5.0% should, by itself, have the same result, right?
"Second junk bond spreads have narrowed sharply in recent weeks and now are back near their Januay lows. Hard to believe we are on the verge of a big stock selloff with junk bonds acting so well."
but the risk in junk bonds is quite a bit lower now, right? i don't see why that would reflect on valuations in equities or possible multiple contraction .... although i'm sure someone will fill me in ...
"First Asian markets DID NOT follow the US down last night."
perhaps they anticipated the sell-off monday?
sorry to be such a pessimist here, and probably wrong headed. but still, i look at intc trading on island, and there are 350 buy orders vs 1800 sell orders ... i've never seen that kind of lopsidedness before. not that it necessarily means anything, but its just the complete inverse of the picture island was painting last summer ... and by a factor of 2 at least ...
i gather alot of you guys are still pretty bullish and looking for a reversal. but isn't it likely that we're seeing now how much the rally of the last year was dependent on the carry trade, and watching them both unwind together? ...
e.g. i look at intc, csco etc on island and the wall of sellers above these prices is immense - like 5x as large as the buyers supporting these prices. although of course its island, so ... big grain of salt there ....
just odd analyst expectations on mot: q4 last year they did 7.7B, q1 this year they did 8B, and that was in spite of not having their new phones ready for market. now the expectations were 6.7B?
something squirrely there ...
a few weeks ago someone asked for a heads up on google ipo:
07:06 ET Google IPO could be at the end of this month -- NY Post : The New York Post reports that because of a technicality, Google's IPO may come as soon as the end of this month. SEC rules state that a co must report financial results if it has at least $10 mln in assets and has more than 500 shareholders. Google has both and may have to issue quarterly reports starting April 30. If true, it would make sense for Google to go public as soon as possible, to avoid disclosing its financial information without the benefits of a stock offering. Because of the expense and the private information that is revealed, very few co's file reports with the SEC yet remain privately held. The other option for Google would be to buy back shares from some of its employees, but that is expensive and unlikely. Google officials refused to comment on the co's filing plans.
re tasr ...
oh come on. 9MM shares in the float and 90MM shares traded in these last 3 days ... big game of russian roulette.
....
actually, kinda funny. 9mm shares traded in the last 45 mins ... lol.
my trinq has been way off lately, but can anyone confirm trin now at 3.22? (seeing trinq @ 1.34 ...)
re oil ... marc faber ...
http://www.gloomboomdoom.com/marketcoms/indexmarketcoms.htm
Should you buy what China buys?
Marc Faber
It is true that China with its extremely competitive manufacturing sector whose productivity is rising rapidly, and India with its very low cost but increasingly sophisticated service sector have a deflationary impact on the world, which certainly played a part in the “jobless” US recovery since 2001. But, as the industrialization of particularly China is progressing at a breakneck speed, and as real incomes and standard of livings are rising rapidly, China’s voracious appetite for certain goods and commodities has over the last two years also inflated some sectors of the global economy through its incremental demand. Moreover, because of the large size of the Chinese economy its growth has by itself become a driver of other countries’ economy, as it sucks in imports from them.
China has a steel production capacity of 260 million tones - rising to 330 million tons in 2005, which is larger than the one of the US and Japan combined but it still requires importing steel in order to cover its growing needs. China’s domestic reserves of iron ore, however, only cover the production of 90 million tons of steel, fueling a voracious appetite for iron ore from countries as far as Brazil! In 2003, China became also the world’s largest user of copper, its share of the world’s copper demand having risen from 6% on 1990, to 12% in 2002 and more than 20% presently. Its cement production and own demand is five times the size of the US cement industry! China is also a huge user of pulp and paper. No wonder, since it publishes every day 82 million newspapers compared to 55 million in the US. China has the world largest cellular phone market with 200 million subscribers and is with its 330 million smokers by far the largest consumer of tobacco.
So, should, therefore, investors buy everything China is buying? Before jumping enthusiastically into the “China investment theme” there are a few considerations investors should take into account. China is relatively resource poor and, therefore, its need for industrial commodities will only increase over time, as its industrial production continues to expand and as net capital formation remains strong. Conversely, China has an unlimited supply of labor, as more than 700 million Chinese still live in the countryside and are now gradually moving to the cities in order to be integrated into China’s industrial society. Moreover, flushed with foreign exchange reserves and overwhelmed by a tidal wave of foreign portfolio and direct investments it has the necessary capital to fund any capacity expansion for manufactured goods. As a result, there is in China cut throat competition for consumer goods such as TVs, appliances, motorcycles, cars and cellular phones. In 1999, China’s domestic cell phone manufacturers had a combined domestic market share of just 3%. Today, 36 domestic manufacturers hold more than 50% of the cell phone market, which has become glutted and where prices are collapsing. The problem with investing in China’s huge and rapidly expanding consumer markets is that new capacities can nowadays thanks to instant communication and information as well as very efficient transportation be brought on stream in no time. Does a shortage of DRAMs develop, any quantity of new capacities can be brought on stream within 18 months, which then depress prices once again. Moreover, if a foreign company launches a sophisticated and highly profitable new product in China, you can be sure that almost instantly numerous local Chinese companies will copy the product and flood the market, thus depressing prices and margins. Thus, the manufacturing in China is characterized by vast overcapacities.
The conditions in the commodities markets are very different. Since commodity prices were in a severe bear market since 1980, little new capacity has come on stream in the last few years with the result that the mining capacity utilization rate stands now at 95% or higher. In addition, from the time exploration begins to the time new substantial reserves come into production, a minimum of 7 years elapses. Therefore, production capacities for most industrial commodities cannot be increased meaningfully in the short term, which means that cycles of rising commodity price tend to last 15 to 30 years. So which commodity should one buy given China’s lack of resources and existing supply constraints?
Particularly sensitive to industrialization and rising standards of living is the energy market. The industrialization of the North American continent lifted annual per capita consumption of oil from one barrel to close to 30 barrels. In the cases of Japan’s industrialization between 1950 and the early 1970s and South Korea’s industrial rise between 1965 and 1990, per capita oil consumption rose in both countries from one barrel to 17 barrels. But here is the scary part. Despite its rapid growth, China’s per capita consumption of oil is still just a tad north of one barrel of oil per year. Moreover, the entire Asian region with 3,6 billion people or 56% of the world’s population and the world’s fastest growing economies of China, India and Vietnam still only consumes 20 million barrels of oil per day, which is less than the US consumes with 285 million people. Simply put, the US has a per capita consumption of oil that is more than 12 times larger than Asia, where rising standard of living – the move from bicycle to scooter to car, the proliferation of shopping centers, office complexes, hotels and entertainment venues, increased traveling, and larger homes - and industrial development, as well as rapidly growing populations and urbanization mean that oil demand doubles every six to ten years. Thus, it is doubtful that the oil producers who currently produce 78 million barrels of oil per day, but whose own oil requirements are themselves soaring due to fast population growth among OPEC countries, will be able to accommodate a doubling of Asian oil demand to around 35 to 50 million barrels of oil per day within the next ten years or so without very significant price increases. Investors should, therefore, overweight oil companies with large oil and gas reserves such as Chevron Texaco, British Petroleum and the Russian oil producers but avoid the now popular but expensive Chinese oil stocks, which lack substantial reserves. In addition, as oil prices are likely to surprise on the upside and drive exploration, oil drilling and service companies such as Schlumberger, Halliburton, and Diamond Offshore should be purchased as well.
Compelling are also the fundamentals of food products. Taiwan, South Korea and Hong Kong have per capita consumptions of meat, sugar, coffee, dairy products, wine, beer and fish eight to ten times larger than China. With rising standards of living in China and other Asian countries, food products richer in protein than rice will proliferate and put enormous upward pressure on food prices at a time of declining food production in China. Therefore, investors should also be long a basket of agricultural commodity futures consisting of wheat, corn, sugar, coffee, and orange juice futures, or own large tracts of agricultural land.
But before jumping recklessly into commodity futures, and iron ore, steel, pulp and paper, nickel, aluminum, fertilizer and copper producers investors should be aware that some commodities such as copper and nickel have already had huge price gains, as the “China appetite for resource play” has become well recognized by speculators. Moreover, China’s economy is overheating and will, in my opinion, experience a severe slowdown in the near future, which will lead to a commodity inventory liquidation and depress prices temporarily. Moreover, whereas I am a strong believer that a long-term up-cycle for commodities began in 2001, investors should be aware that for individual commodities price cycles are of far shorter duration (see figure below).
I would also like to point out that since all asset classes including commodities, bonds, stocks and real estate rose in price in 2003, it is conceivable that everything will decline in 2004!
Still, the long term fundamentals of commodities, particularly of oil, are by far more compelling than the ones of US equities – this especially since according to several historians including Arnold Toynbee, rising commodity prices have always turned up the war cycle, as the drive to secure the supply of finite and scarce resources intensifies. This should be particularly true for China whose economic Archilles heel is lack of water, food, oil and other industrial commodities!
scox unravels ....
The SCO(R) Group, Inc. Receives Request From BayStar Capital II, L.P. to Redeem Shares of Series A-1 Convertible Preferred Stock
Friday April 16, 1:45 pm ET
LINDON, Utah, April 16 /PRNewswire-FirstCall/ -- The SCO Group, Inc. ("SCO") (Nasdaq: SCOX - News), the owner of the UNIX operating system, received a letter on April 15, 2004 from BayStar Capital II, L.P. requesting that SCO immediately redeem BayStar's 20,000 shares of SCO's Series A-1 Convertible Preferred Stock. The letter asserts that BayStar is entitled to the redemption of its shares under Article VII.A(vii) of the Certificate of Designation, Preferences and Rights of the Series A-1 Convertible Preferred Stock because SCO has allegedly breached Sections 2(b)(v), 2(b)(viii), 2(b)(viii) and 3(g) of the Exchange Agreement dated February 5 2004 among SCO, BayStar and Royal Bank of Canada, which also holds shares SCO's Series A-1 Convertible Preferred Stock.
BayStar's letter did not provide specific information regarding SCO's alleged breaches of the Exchange Agreement. SCO is attempting to obtain specific information from BayStar and is evaluating its obligations and options with respect to the redemption notice. However, SCO does not believe it has breached any of the referenced provisions of the Exchange Agreement. As a result, SCO does not believe it is obligated to redeem BayStar's shares of Series A-1 Convertible Preferred Stock.
Forward-Looking Statements
This press release contains forward looking statements related to SCO's belief that it has not breached any of the provisions of the Exchange Agreement described in BayStar's letter and its belief that it is not obligated to redeem BayStar's shares of Series A-1 Convertible Preferred Stock. SCO wishes to advise readers that a number of important factors could cause actual results to differ materially from those anticipated in such forward-looking statements including a finding that SCO has breached the referenced provisions of the Exchange Agreement entitling BayStar to redemption. These and other factors that could cause actual results to differ materially from those anticipated are discussed in more detail in SCO's filings with the Securities and Exchange Commission.
About SCO
The SCO Group (Nasdaq: SCOX - News) helps millions of customers in more than 82 countries to grow their businesses everyday. Headquartered in Lindon, Utah, SCO has a worldwide network of more than 11,000 resellers and 4,000 developers. SCO Global Services provides reliable localized support and services to partners and customers. For more information on SCO products and services, visit http://www.sco.com.
SCO, and the associated SCO logo are trademarks or registered trademarks of The SCO Group, Inc. in the U.S. and other countries. UNIX is a registered trademark of The Open Group.
... but this weekend, all of the news will be about the woodward book ... its already started ...
Journalist Shares War Secrets
April 16, 2004
Woodward: War On Iraq
(CBS) Legendary journalist Bob Woodward discusses his new book, which reveals secret details of the White House’s plans to attack Iraq, for the first time on television in an interview with correspondent Mike Wallace on 60 Minutes, Sunday, April 18, at 7 p.m. ET/PT.
Woodward interviewed 75 of the people who helped prepare for the war, including President Bush – the only source who speaks for attribution -- in the upcoming book, “Plan of Attack,” published by Simon & Schuster. Both CBSNews.com and Simon & Schuster are units of Viacom.
In the interview, Woodward talked about how the administration was able to finance secret preparations for the Iraq war.
"President Bush, after a National Security Council meeting, takes Don Rumsfeld aside, collars him physically and takes him into a little cubbyhole room and closes the door and says, 'What have you got in terms of plans for Iraq?' What is the status of the war plan? I want you to get on it. I want you to keep it secret," says Woodward.
"...The end of July 2002, they need $700 million, a large amount of money for all these tasks. And the president approves it. But Congress doesn't know and it is done. They get the money from a supplemental appropriation for the Afghan War, which Congress has approved. ...Some people are gonna look at a document called the Constitution which says that no money will be drawn from the treasury unless appropriated by Congress. Congress was totally in the dark on this."
[...]
re inflation: well i raise that because this paints a pretty scary picture ... to me, at least:
http://www.nytimes.com/2004/04/16/business/worldbusiness/16YUAN.html?hp
re overblown: my question was really a question: i don't have any good feel for how big the carry trade is here or how long it takes to unwind. but i think everyone has the feeling that its huge and has everyone sitting on the same side of the boat, and that it won't happen without some violent moves in the markets ...
nevertheless, it is looking to me like they've lost the ability/desire to pump up multiples. e.g. pmcs is something i follow alot, and beating significantly as they did last night wouldn't ever, in the past year, have resulted in it dropping more than a dollar ... not unless we're seeing some multiple contraction in that stock.
but you're also omitting inflation in china that they'll soon be exporting ...
"overblown": how can you measure that, though? how long is it going to take to unwind that huge, highly-leveraged carry trade?
Misys gives Pecker head job
By Nick Lord 05 March 2004
Rudi Pecker assumes position in top slot in Asia.
After 14 years inside Misys in Europe, Rudi Pecker has been elevated to the financial technology company's Singapore office, to become head of Asia Pacific sales. In this role, Pecker will head all Misys' strategic and commercial activities in the region, aiming to grow the business and enter into long term relationships. Pecker's breadth of experience, with over 20 years in the financial services industry, will enable him to rise to the challenges of growing the business in Asia, a region fertile for expansion.
"The Asia Pacific region is very important to the Misys business, so having the right person at its head is crucial to our success, both there and worldwide," says Andy White, CEO of Misys Wholesale Banking Solutions. "We are delighted that Pecker will be leading the way"
Misys systems cover solution in trade finance, international banking, treasury and capital markets, confirmation matching, continuous linked settlements, ebanking, middleware and financial messaging.
Pecker will continue reporting to Armin Holst, Global Sales director for Misys Wholesale Banking Systems. "We are certain that [Pecker's] experience will help to significantly strengthen and ultimately grow, our business in Asia," says Holst.
"The market will tell the tail; speaking of tails, the market is the dog wagging the Fed tail. There IS a presidential election coming up."
hrm. well i trust moves in the bond market more so than the stock market. (which is why i still have 1/2 of my shorts of financials open).
but unless you're the conspiratorial type, the observation is that the market reacts to fiscal policy which has the election in its sights. and we've seen most of that now. and at this point we still have everyone sitting on one side of the boat. heck, does the boat even have another side?
well i'm seeing trin @ 1.47 right now. and has been above 1.3 all day (trending down from 1.73 @ 10:10 until 1.32 @ 11:10, and now trending up).
however, i'm still seeing trinq acting very oddly: from 1.22 at the open, trending down to 0 from 9:55 to 10:35, and between 0.01 and 0.03 since then ...
hunh? are the numbers i'm seeing completely off?? because i was watching the trinq trend down until it hit 0.0 and now see it pegged there ... is that even possible??
its odd google doesn't have a latin translation tool. you can already set your preferences to have your google interface presented in latin. but then you can also set it for klingon and 'elmer fudd' too ...
Topping said a problem with a clock in Reuter's London offices put an incorrect time stamp on the story that moved on Yahoo. ``The clock is being replaced,'' she said.
they have a separate clock to timestamp articles? hmmm. isn't that strange, when every computer is inherently a clock and can be syncronized regularly within milliseconds to standard time servers? heck, even my home computer syncs regularly.
http://twiki.ntp.org/bin/view/Servers/WebHome
what ever happened to that sec investigation of options trading before 9/11?
"The Economist has a story analyzing the recent Sun-Microsoft deal. What's especially interesting is the ending. Sun recently promoted Jonathan Schwartz to President and Chief Operating Officer, recognizing the need for radical change if the company is to survive. According to the story, Schwartz's dream is 'to sell deep-discount desktop computers at Wal-Mart, carrying Sun's office applications on top of a Linux operating system'!"
http://www.economist.com/
Maybe we get out sooner than hoped?
heck, if bush, cheney, rumsfeld and cheney really did all come out and amit they were wrong, even i'd go out and buy some tasr to celebrate.
but the charts are showing a resumption of the downtrend after a minor correction, apparently accelerating, with a full 9% drop since friday's employment numbers.
http://www.rasmussenreports.com/Presidential_Tracking_Poll.htm
I think SCOx case is much better then most pundits think. I am long. The disinformation, and vile critisiscm of the company reminds me alot of Qcom and RMBS in the early days. Now I think they have 50% chance of winning in court. I however dont believe IBM would take that risk, and chance a 5 billion verdict, and slowing of LINUX adoption. My guess is this gets settled or SCO gets bought.
please please please, you owe it to yourself to at least check out the discussions on groklaw ( http://www.groklaw.net/ ). folks from scox have had a long time to produce evidence of their claims, and they refused; when finally forced to by the court, there really is nothing ... (and if there *were* anything, it would be removed from linux by the end of the day it was revealed and the folks would rewrite it ...). this is a big deal to the linux community, and they would evicerate and rebuild linux first before allowing scox to profit off their work ...
surprised they waited?? this is the 3rd time that silver margin has been tightened since january. isn't that somewhat unprecedented? not to mention unsportsmanlike ...
Another take on those jobs numbers:
GOVERNMENT'S JOBS DATA WILL COST YOU MONEY
By JOHN CRUDELE
April 6, 2004 -- THE government mysteriously took away jobs in January and the government magically put them back this month.
In last Thursday's column I showed how the Labor Department removed 321,000 jobs from the official count in January because it guessed that lots of companies were going out of business and taking jobs with them.
And I explained how this made January's job growth look pathetically small instead of robust. Put another way, the revised figure of just 112,000 jobs in January - instead of the 433,000 it would have been - was something the Democrats loved and the Republicans hated.
Well, the March figures released last Friday gave back about haAlf the jobs taken out in January, using the opposite logic. Suddenly the government thinks lots of companies are being incorporated and that these new outfits created 153,000 of the 308,000 new jobs for the month.
Without this "birth adjustment" as the government calls it, the new jobs figure in March would have been a very ordinary 155,000. I wish this were just a fun-with-numbers exercise. But the glaring adjustments being made by the government actually do have an important impact on our lives.
While stocks rallied on the news, the bond market was appalled. Interest rates shot up on Friday and are likely to rise more.
Soon you will be paying noticeably more for mortgages and home loans, and companies will have their profits hurt by rising borrowing costs.
Moreover, because of last week's employment report, the Federal Reserve is now likely to raise interest rates sooner rather than later - especially if commodity and other prices continue to rise.
As I've said before, Fed Chairman Alan Greenspan has been warned by private sources that inflation is picking up. And, as I predicted, Fed officials are now starting to chatter publicly about the problems that inflation might cause.
A rise in borrowing costs from current historic lows is a major concern if - and I think this is what's happening - the government's constantly fluctuating stats are faulty and are making the economy look stronger than it actually is.
If that's what is going on, then the nascent economic recovery could be smothered before it has a chance to really breathe.
*
Will Martyr Stewart get a new trial on her conviction for lying to federal prosecutors now that we know one of her jurors lied to the federal court?
It's a long shot. U.S. Judge Miriam Goldman Cedarbaum probably doesn't want the millions the government spent on the trial to go to waste.
But there are two things that Stewart's side is probably hoping for. One, that the controversy surrounding juror Chappell Hartridge will cause Cedarbaum to go easier when she sentences Stewart.
More important, Hartridge's omission of a criminal record from the juror questionnaire could make a good issue in an appeals case.
*
The stock market got bopped by a rumor last Wednesday that Fed boss Alan Greenspan had a heart attack. The pain - for the market, that is - didn't last long, because the gossip was quickly debunked.
Let me re-bunk it.
A source of mine with a sense of the pulse of the Fed - please don't miss this pun - tells me that Greenspan was feeling poorly last Tuesday after work and went to his personal doctor for a checkup.
No heart attack, and everything is OK. But the guy is 78 years old, and he seems to have had a falling out with the Bush Administration - so any unplanned visit to a doctor is something that Wall Street is going to take note of.
RE: King Report details the scam shebesavvy
NEW 4/6/2004 4:05:04 AM
[Sent by a trader friend. Interesting caveat re roiling of bond market at, uh, pre-release of "data."]
From The King Report
M. Ramsey King Securities, Inc.
Monday April 5, 2004 - Issue 2890 "Independent View of the News"
..We have never seen such a grossly misinterpreted Employment Report in our 30 years in this biz. But the nature of the wise-guy-dominated markets is to shoot first and analysis later. So if you don't want to know the truth or if in the words of Jack Nicholson "You can't handle the truth" ignore the following.
About release of the report, we immediately noticed some huge red flags. How could non-farm payrolls explode 308k when a) the unemployment rate increased to 5.7%; b) wage growth was less than expected at 0.1%; c) the "employed population ratio" actually FELL to 62.1% from 62.2%; d) the "employment participation rate" was unchanged at 65.9%; e) total employment was unchanged at 138.3m and most importantly f) the avg workweek fell 0.1 to 33.7, which is near a 40-year low (33.5)! (See table A-1.)
When dissecting the numbers we learned that NSA service job wages fell 8 cents and they accounted for 230k of the 308k job growth. Leisure & hospitality wages NSA fell 4 cents; and NSA avg hours worked fell 0.3. Something is obviously wrong. Healthcare contributed 36k jobs, leisure & hospitality 28k, retail 47k, government created 31k and the phantom jobs estimated to be created by small business was 153k! This is now known as the business birth/death rate. Apparently a large number of workers entered the workforce in order to force the unemployed rate higher, but still something seemed incredibly wrong.
After the close, our good friend and astute, no nonsense economist, ex-Fed official and investment adviser (at Van Hoisington Management), Lacy Hunt, provided the answers to the conundrum. Of the 308k jobs created, 296k are temporary or part-time jobs! Let us repeat and let's be very clear, almost all jobs created in what is heralded as a great employment report are part-time jobs. "In March, the number of persons who worked part time for economic reasons increased to 4.7 million, about the same level as in January. These individuals indicated that they would like to work full time but were working part time because their hours had been cut back or because they were unable to find full-time jobs. (See table A-5.)" People want full-time but can't find it. Lacy opines that Congress did not renew unemployment benefits so many people took whatever they could get. This accounts for the surge in people entering the workforce. http://www.bls.gov/news.release/empsit.t05.htm Lacy noticed other salient points in the
report. The average weekly paycheck in February for the private sector was $524.58; in March it fell an astounding 88 cents to $523.70. The area of job growth shows even worse numbers. The average weekly paycheck for leisure & hospitality workers is $225.55. Retail is $364.50. Now everything fits and conforms, especially to the large fundamental trend of persistent lowering of US living standards as those in Asia increase. This is great news for Bush and the US!?! And this is reason for TV broken-clock jackasses to hoot and holler?!? But there is more.
"The index of aggregate weekly hours of production or nonsupervisory workers on private nonfarm payrolls fell by 0.1 percent in March to 99.0 (2002=100). The manufacturing index was down by 0.3 percent over the month to 94.1. (See table B-5.)"
In the Employment report there is this illumination in Table A-7: "NOTE: Detail shown in this table will not necessarily add to totals because of the independent seasonal adjustment of the various series. Beginning in January 2004, data reflect revised population controls used in the household survey." So we checked to see why the caveat. "More unemployed" increased 182k; but in the table, men age 20+ saw unemployment increase 182k. Women age 20+ had a 142k increase in unemployment. That totals 346k more unemployed by real math, but not BLS math. http://www.bls.gov/news.release/empsit.t07.htm
The Employment Report is 180 degrees from what is being propagated. As we have regularly stated, especially during Slick's term: 1) due to the proliferation of 'fast money', operators and investors react to headline data and news without thought or analysis and 2) commentators, pundits, gurus etc. tend to rationalize market moves rather than analyze the data or events. PS - The hedge fund industry is headed for a major reorganization and philosophical change. Too many knee-jerk lemmings try to quickly make small percentage moves under huge leverage. And we don't want to get into the 'fund of fund' gatekeepers that are populated by many with no trading, investing or business experience.
Now let's see who in the industry does the requisite analysis of the employment report and has the nerve to say the emperor has no clothes. But you now know the facts and reality. The market will realize this in due time, and it won't be a pleasant adjustment. Wells Fargo (Minneapolis) economist Sung Won Sohn is the only other economist that we saw mention that part-time jobs were most of the jobs gain.
Construction jobs increased 71k in March. Midwest Research notes "Industrial construction volumes (millions of sq ft) reached their highest level in over 2 yrs during 4Q03; vacancy rates have flattened out, but remain at/near 9-yr highs." Despite 9-year highs in vacancy builders keep building. Of course it's due to Easy Al's bubble policies. Giving cheap money to builders is like giving cheap beer to frat boys. Most will consumer it even when it is imprudent and self-destructive. This explains why bubbles, let alone reflated bubbles, are so pernicious. They encourage mal-investment in areas with over-capacity, which just exacerbates the big-picture problems and eventual adjustment.Midwest Research also notes that scrap iron prices fell almost 15% in March, the first decline in 9 months due to the absence of Chinese buying. The evidence is clear that Chinese officials want to slow down its economy. http://www.midwestresearch.com/disclosures/index.asp
The ECB refrained from lowering rates on Thursday. The market expected a cut because Euro economic fundamentals, especially Germany, are receding. We'd guess the ECB has joined the BoE, BoC and BoJ fear of inflation camp. Good thing the Fed sees no inflation and they can remain patient.Weekend reports say the BoE might hike rates this week due to inflation, especially in British homes.
Poor Martha Stewart gets cheesed for a few thousand dollars while 9/11 profiteers and the people who had the employment report early on Friday made millions. S&P futures started to soar at 7:20 CST; USUs started tanking at 7:24. At one point bonds fell 4 handles on the panic. This should give late-night sweats to Fed, banking and brokerage officials. If bonds can collapse that fast on the perception the Fed might hike rates 25 bps (on a grossly misinterpreted report at that) what will transpire when a serious problem, rate hike or market-generated surge in rates occur? To avoid a series of LTCM mishaps, risk models better be run with something other than rate assumption that reflect the halcyon times of the past many years. PS - Journalists get the data at 8Am CST. The WH and various officials have the report by Thursday afternoon.
The ECRI "US Future Inflation Gauge" jumped to 118.8 in March from Feb's 115.7, which was revised higher. Every reading since June has been revised higher. There is profound significance here beyond the surface issue of increasing inflationary pressure. The founder of ECRI, Geoffrey Moore, was Easy Al's mentor and one of his professors. Al reportedly still closely follows Moore's work. But Al has to ignore inflation due to the big-picture of unserviceable debt and the intractable diminution of US living standards due to the ascent of Asia and other developing countries. http://www.businesscycle.com/freedata.php
"Nok earnings hit by Motorola success. Motorola shipped a record number of cell phones this quarter."
but that's not implied directly by the warning, unless motorola in fact took market share in the high-end of the market.
HELSINKI, April 6 (Reuters) - The world's largest mobile phone maker Nokia said on Tuesday first-quarter earnings would be at the low end of expectations while sales would decline by two percent year-on-year due to sales of cheaper handsets.
so i guess this means that your call to "short financials" isn't necessarily in effect any longer? or is perception all that counts?
hehe. it may be even easier than that. i mean, what convinced me of the validity of friday's move on the jobs numbers was the big move in the bond market. now was that a case of a "leak" as everyone is suggesting and the BLS is refuting? or is it just the tail wagging the dog?
i think it goes back to what zeev and others here have said: most news doesn't really move the market in big ways. sustained rallies etc develop over time and have their own internal dynamics and are going to be moved by more than just the release of one questionable statistic. the market pretty much tells us how to react to the news. and ever since mlsoft converted me last summer, i've come to believe that the market is easier for "them" to manipulate than the news itself ...
From The King Report
M. Ramsey King Securities, Inc.
Monday April 5, 2004 - Issue 2890 "Independent View of the News"
..We have never seen such a grossly misinterpreted Employment Report in our 30 years in this biz. But the nature of the wise-guy-dominated markets is to shoot first and analysis later. So if you don't want to know the truth or if in the words of Jack Nicholson "You can't handle the truth" ignore the following.
About release of the report, we immediately noticed some huge red flags. How could non-farm payrolls explode 308k when a) the unemployment rate increased to 5.7%; b) wage growth was less than expected at 0.1%; c) the "employed population ratio" actually FELL to 62.1% from 62.2%; d) the "employment participation rate" was unchanged at 65.9%; e) total employment was unchanged at 138.3m and most importantly f) the avg workweek fell 0.1 to 33.7, which is near a 40-year low (33.5)! (See table A-1.)
When dissecting the numbers we learned that NSA service job wages fell 8 cents and they accounted for 230k of the 308k job growth. Leisure & hospitality wages NSA fell 4 cents; and NSA avg hours worked fell 0.3. Something is obviously wrong. Healthcare contributed 36k jobs, leisure & hospitality 28k, retail 47k, government created 31k and the phantom jobs estimated to be created by small business was 153k! This is now known as the business birth/death rate. Apparently a large number of workers entered the workforce in order to force the unemployed rate higher, but still something seemed incredibly wrong.
After the close, our good friend and astute, no nonsense economist, ex-Fed official and investment adviser (at Van Hoisington Management), Lacy Hunt, provided the answers to the conundrum. Of the 308k jobs created, 296k are temporary or part-time jobs! Let us repeat and let's be very clear, almost all jobs created in what is heralded as a great employment report are part-time jobs. "In March, the number of persons who worked part time for economic reasons increased to 4.7 million, about the same level as in January. These individuals indicated that they would like to work full time but were working part time because their hours had been cut back or because they were unable to find full-time jobs. (See table A-5.)" People want full-time but can't find it. Lacy opines that Congress did not renew unemployment benefits so many people took whatever they could get. This accounts for the surge in people entering the workforce. http://www.bls.gov/news.release/empsit.t05.htm Lacy noticed other salient points in the
report. The average weekly paycheck in February for the private sector was $524.58; in March it fell an astounding 88 cents to $523.70. The area of job growth shows even worse numbers. The average weekly paycheck for leisure & hospitality workers is $225.55. Retail is $364.50. Now everything fits and conforms, especially to the large fundamental trend of persistent lowering of US living standards as those in Asia increase. This is great news for Bush and the US!?! And this is reason for TV broken-clock jackasses to hoot and holler?!? But there is more.
"The index of aggregate weekly hours of production or nonsupervisory workers on private nonfarm payrolls fell by 0.1 percent in March to 99.0 (2002=100). The manufacturing index was down by 0.3 percent over the month to 94.1. (See table B-5.)"
In the Employment report there is this illumination in Table A-7: "NOTE: Detail shown in this table will not necessarily add to totals because of the independent seasonal adjustment of the various series. Beginning in January 2004, data reflect revised population controls used in the household survey." So we checked to see why the caveat. "More unemployed" increased 182k; but in the table, men age 20+ saw unemployment increase 182k. Women age 20+ had a 142k increase in unemployment. That totals 346k more unemployed by real math, but not BLS math. http://www.bls.gov/news.release/empsit.t07.htm
The Employment Report is 180 degrees from what is being propagated. As we have regularly stated, especially during Slick's term: 1) due to the proliferation of 'fast money', operators and investors react to headline data and news without thought or analysis and 2) commentators, pundits, gurus etc. tend to rationalize market moves rather than analyze the data or events. PS - The hedge fund industry is headed for a major reorganization and philosophical change. Too many knee-jerk lemmings try to quickly make small percentage moves under huge leverage. And we don't want to get into the 'fund of fund' gatekeepers that are populated by many with no trading, investing or business experience.
Now let's see who in the industry does the requisite analysis of the employment report and has the nerve to say the emperor has no clothes. But you now know the facts and reality. The market will realize this in due time, and it won't be a pleasant adjustment. Wells Fargo (Minneapolis) economist Sung Won Sohn is the only other economist that we saw mention that part-time jobs were most of the jobs gain.
Construction jobs increased 71k in March. Midwest Research notes "Industrial construction volumes (millions of sq ft) reached their highest level in over 2 yrs during 4Q03; vacancy rates have flattened out, but remain at/near 9-yr highs." Despite 9-year highs in vacancy builders keep building. Of course it's due to Easy Al's bubble policies. Giving cheap money to builders is like giving cheap beer to frat boys. Most will consumer it even when it is imprudent and self-destructive. This explains why bubbles, let alone reflated bubbles, are so pernicious. They encourage mal-investment in areas with over-capacity, which just exacerbates the big-picture problems and eventual adjustment. Midwest Research also notes that scrap iron prices fell almost 15% in March, the first decline in 9 months due to the absence of Chinese buying. The evidence is clear that Chinese officials want to slow down its economy. http://www.midwestresearch.com/disclosures/index.asp
The ECB refrained from lowering rates on Thursday. The market expected a cut because Euro economic fundamentals, especially Germany, are receding. We'd guess the ECB has joined the BoE, BoC and BoJ fear of inflation camp. Good thing the Fed sees no inflation and they can remain patient.Weekend reports say the BoE might hike rates this week due to inflation, especially in British homes.
Poor Martha Stewart gets cheesed for a few thousand dollars while 9/11 profiteers and the people who had the employment report early on Friday made millions. S&P futures started to soar at 7:20 CST; USUs started tanking at 7:24. At one point bonds fell 4 handles on the panic. This should give late-night sweats to Fed, banking and brokerage officials. If bonds can collapse that fast on the perception the Fed might hike rates 25 bps (on a grossly misinterpreted report at that) what will transpire when a serious problem, rate hike or market-generated surge in rates occur? To avoid a series of LTCM mishaps, risk models better be run with something other than rate assumption that reflect the halcyon times of the past many years. PS - Journalists get the data at 8Am CST. The WH and various officials have the report by Thursday afternoon.
The ECRI "US Future Inflation Gauge" jumped to 118.8 in March from Feb's 115.7, which was revised higher. Every reading since June has been revised higher. There is profound significance here beyond the surface issue of increasing inflationary pressure. The founder of ECRI, Geoffrey Moore, was Easy Al's mentor and one of his professors. Al reportedly still closely follows Moore's work. But Al has to ignore inflation due to the big-picture of unserviceable debt and the intractable diminution of US living standards due to the ascent of Asia and other developing countries. http://www.businesscycle.com/freedata.php
Both could be included in the new jobs created in the last few months. My hope is more for them than the market even thou the 2 should conincide.
computer/it jobs were the only category that saw a decline in the last jobs report (by 1000).
i love the king report!
Cooking the Books with Elaine
U.S. Secretary of Labor Elaine L. Chao has agreed to co-host a series of appearances with Emeril Lagasse on the Food Network. The series, entitled “Cooking the Books”, will focus on techniques used by the Bureau of Labor Statistics to manage perceptions of the “economy.”
Four shows will air beginning in early November. The first presentation will highlight the cooking of the CPI, with segments on flatbread, pancakes, omelets and crepes. The series will run through the end of the month, culminating on Thanksgiving day when the biggest turkey of them all, the employment numbers, will be cooked right there on live TV and fed to the American public.
Chao has promised to show Emeril how seasoning adjustments, productivity allowances, hedonic deflations, intentional regroupings, index reconstitutions and several other special tricks of the trade allow the BLS to come up with masterful new creations month after month after month.
When the news of this upcoming series reached the oval office, the President reacted with shock. He was so upset that he burst into the office of his immediate supervisor, Karl Rove, and shouted “What the hell are they doin' over there at Labor? Are they free basin' their Diet Coke or what?”
After reminding the President about manners, knocking and preferably making an appointment, Rove carefully and patiently explained to him that no harm could possibly come from her appearances. “After 50 years of television, the American public is by and large a bunch of emotional cripples who are easily manipulated with guilt feelings. They are incapable of deductive reasoning. They are told what to think by media that is concentrated in a few hands with whom we share common goals and objectives.”
Rove explained to the president that the collective intellectual capacity of the American public had diminished to the point where the only things they understood were things that were broken down into idiot-speak and spoon fed to them by arrogant and condescending “anchor persons”.
The President's brow was deeply furrowed and he appeared perplexed He took a slow pull on his Diet Coke and then he exploded….”Dammit, Karl, what the hell are you gettin' at? Why the hell can't you explain stuff so's I can understand what the hell you're sayin', like the way Peter Jennings does?”
Rove sneered, stretched his neck to raise his constricted nostrils and put on his best airs of condescension. “We know what's best for you and the other peasants. We feed you phony numbers about the “economy” all the time. Now we're going to explain how we cook the books, even though you won't understand a word of what we say. But stay tuned for the commercials, which you will understand.”
“You and the majority of the American public are so stupid that you won't comprehend what's happening even if the Secretary of Labor comes on the television and explains how the Bureau of Labor Statistics cooks the economic statistics that are fed to you.”
The President seemed to be getting the picture now. He smirked, cracked another Diet Coke and told Rove “It's OK with me if the higher-ups go along…”
So Rove called Cheney who called Greenspan who called Marc Rich. The verdict was unanimous right up the chain of command: No political harm could come from having the Secretary of Labor go on television and explain to the American public how the economic numbers are cooked.
Rove reported that the “higher-ups” (as the President liked to call them) all signed off on the deal. But Rove sensed a trace of hesitancy on the part of the President, so he offered up the crowning glory, the final touch, an offer the President could not refuse.
As he listened to Rove lay out the plan, the President grinned broadly between sips of Diet Coke. “Geez, Karl, do you really think I'll look that good, up there on TV, standin' next to Emeril, wearin' one a them chef's hats?”
“Just don't open your mouth”.
So our kids won't even have enough jobs to do more than get by much less clean up after the boomers.
well, you're kind of mixing up timeframes here. as the baby boomers leave the workforce, workers become more scarce, and demand for young workers should increase. take offshoring/outsourcing out of the picture, and that could mean rising wages. add in greenspan's suggested changes, and then you could get prices and wages rising faster than the increase in soc sec obligations.
but you can't have it both ways: if there are too few workers to support soc sec, then its unlikely that unemployment is going to be a problem. just need to make sure retired boomers spend everything they get on services. and that's good, cuz boomers are good at spending
all hypothetical of course, but not deserving of gloom and doom just yet, unless you're a politician with an agenda.
"I doubt the Govt numbers are intended to be distributed in that manner."
perhaps not intended, but c'mon, of course they're used for political purposes. i mean, look at the current report: it doesn't even mention what the seasonal adjustment is.
re short financials: any particulars you have in mind? more like $bkx in general, cof/consumer debt? ge and all of that new supply?
grr. its amazing to see how wall street hypes things like nanotech. e.g. if you contrast what the strongest advocates in the scientific community have said ...
http://www.foresight.org
http://www.foresight.org/NanoRev/FIFAQ1.html#FAQ7
8. How long will it take to develop molecular nanotechnology?
We began our discussion with physics and chemistry and continued with the capture and placement of single atoms using new devices like the scanning tunneling microscope. Shortly thereafter, researchers were able to create carbon nanotubes, which is likely to become our primary structural element in the future. Nobel Laureate Dr. Richard Smalley (Rice University) discussed the advances in carbon nanotube manipulation in his 1996 address: From Balls to Tubes to Ropes: New Materials from Carbon. Recent presentations at the Foresight Conference on Molecular Nanotechnology highlight that this development continues as we gain the ability to assemble the fibers into sheets and three-dimensional lattices. Dr. Carlo Montemagno of Cornell and his team of scientists have created the first molecular motor, and this gives us an inkling of some of the atom transport systems that may arise.
Computer systems continue to advance as well, with the development of faster, smaller, and cheaper systems that have greater capacity. Assuming that security systems also see improvement, then these should be applicable to molecular machines, once they are developed. These improvements will also impact our ability to model new molecular devices, and help stabilize design parameters before the machines are actually built.
Development in nanotechnology is expected to continue at an accelerating pace, given that funding for these types of research is increasingly available. While estimates range from 15 to 50 years, there is no question that nanotechnology will arrive in the not-too-distant future. We recommend that you read Nanodot or become a supporting member of the Foresight Institute, entitling you to receive the quarterly Foresight Update, which always contains information on the latest developments.
"usey could gap up again tomorrow- good news coming"
ppi? could this be good? i would think negative or neutral ...
doesn't gold always make exaggerated moves at end of month? (futures expiration)
scox endgame? back on the road to 0?
IBM seeks knockout blow in SCO case
Legals experts see confidence in latest IBM filings
http://www.infoworld.com/article/04/03/30/HNscoknockout_1.html
Bummer is, I had an order in to buy WHT all day at $3.11. Missed by one penny.
yeah, i had "OB"'s on WHT for a long time during this whole correction (having previously sold what i had back in dec).
i regret not following up more aggressively on those warrants that mlsoft used to talk about here regularly
oh, all you lucky wht owners
Iamgold Agrees to Buy Wheaton River for $2.2 Billion as Gold Prices Rise
um. or vice versa:
Canada's Wheaton River in $850 mln bid for Iamgold
http://quote.bloomberg.com/apps/news?pid=10000087&sid=ayw8TbaQ4iAY&refer=top_world_news
http://biz.yahoo.com/rc/040331/minerals_iamgold_wheatonriver_2.html