How was that for a week? Indices moved briskly higher on lower oil prices, as Ernesto — the hurricane that wasn’t — took some of the sting out of Crude prices. Oil flirted with the high sixties, closing Friday afternoon at $70.20.
August turned out to be the best month for market gains since January. The Dow had its highest close since May. The only question is what happens when the A-team retruns to their trading turrets: Do they feel performance anxiety and jump in, or do they take advantage of higher prices and hit bids? You’ll know the answer in 72 hours or so.
Good week in the market, bad weather for the weekend. My sun & sea plans got cancelled by the wet, rain-soaked Labor Day weekend. Thanks to the slop, you get this belated and unexpected linkfest!
Real Estate and Housing
• Bloomberg’s Caroline Baum looks at stabilizing prices, rising foreclosures and credit risks: Housing `Short Sales’ Are Latest Sign of Stress; The Association of Risk Professionals, in a dramatic case of understatement, observes US Housing Market Experiencing Turbulence;
• The increasingly popular numbered format for Real Estate columns:
The Federal Reserve and Bernanke
• Friday was Ben Bernanke Day in Dillon, S.C.! The Fed Chief expects strong U.S. productivity to continue;
• The Pause was a "Close Call;" Some on the Fed are unsure of further
Fed Gov. Lacker was the lone dissenter in recent vote to stand pat; He says inflation is too high; Regardless, Friday’s NFP data certainly puts the Fed will be on hold for a while.
• Charles Bean, the Bank
of England‘s chief economist, is aghast at the absurd focus on the Core Rate of inflation by the U.S. Central Bank: The Fed is Wrong on Core Inflation (if no FT, then go here)
Markets & Investing
• On Thursday, both Richard Suttmeier and I thought the Bond Rally Looked Crowded and Tiring;
• Chuck Jaffe on the mental exercise of Dumping Everything, and seeing what you would rebuy here and now.
• What does the Dow Jones Utilities Averages’ new high mean? (hint: dunno)
• Here’s what some oldtimers are doing:
-Now that’s A Perma-bear! Still in Cash since ’86;
• von Mises on Money and the Stock Market: What is the Relation?
• For the truly cautious: E*Trade is offering these rates for CDs:
5.46% APY on a 6-month CD.
5.50% APY on a 1-year CD.
5.25% APY on a 5-year CD.
Remember there is aways re-investment risk on all short maturity yield products;
• Friday’s NFP was pretty lackluster; The good news is it puts the Fed
on hold for at least another 2 meetings; The bad news is the data beneath the headline number was Fugly!
• I guess the watchword is slowdown:
- Corporate Profit Growth Slows in Step With Economy (if no WSJ, go here)
• Bernanke and Greenspan may not think much of the Yield curve, but two Federal Reserve Bank of New York Economists think it has predictive value: The Yield Curve as a Leading Indicator: Some Practical Issues (pdf)
• I’ve been kvetching about inflation for the past 4 years; Here is a sign it may be slowing and even reversing: Restaurants shave prices, plump menus and Can Stephon Marbury’s $15 sneaker revolutionize the sports-shoe business?
• The Retail Sector is not telegraphing very good things to come:
• The Odd Recovery: Unemployment Is Low and So Is Employment;
• You no longer have to wait for the first Friday of each month: Play The Payroll Employment Game
Politics, Military and Media
• Donald Rumsfeld gave a controversial address at the American Legion; His rebukes came from all quarters, left and right — the most reasoned was Slate’s Four Questions for Rumsfeld; The most stinging came from MSNBC’s Keith Olbermann, who questioned Rumsfeld’s grasp of history — (Video of Olbermann’s response)
• Why your capital gains tax rate ain’t remotely close to 15%: The Unkindest Tax Cut (Barron’s)
• The NYT business columnist Floyd Norris is now blogging;
TECH and SCIENCE
• I give Dell a lot of grief for all the things they do wrong: Let me praise them when they get something right: My head is a box filled with nothing;
• Microsoft Grants 37 Million Shares To 900 Execs — about $1billion dollars;
• Marketwatch columist John Dvorak claims "the real reason Google (GOOG) CEO Eric Schmidt is joining the Apple (AAPL) board is to lay the groundwork for a merger between Apple and Sun Microsystems (SUNW)." Eric Savitz doesn’t think so; Neither does Jeff Matthews, who has a hilarious take down of Dvorak’s senile ramblings.
• Yeah, I wish: New York to L.A. in Two Hours
• Are tall people smarter? (this study says yes)
• The $1,000,000 duck race (a charity event)
Music Film Books TV
• 8 years after Napster, the music industry has finally begun to compete with free music downloads: Spiral Frog;
• Vaughn Trapp sounds like a cross between The Beatles and Crowded House;
• Here’s the latest RIAA nightmare: Google Hacking to Locate MP3s
• Download the classics for free: Google public domain books
• Bob Dylan’s new tune, When the Deal Goes Down;
• The Pitchfork Effect: How a tiny web outfit became the most influential tastemaker on the music scene.
And that’s pretty much all from the sloppy, rainy miserable northeast, where I will be neither jet skiing nor parasurfing. I do have an old bottle of Cognac I’ve been meaning to crack open . . .now if I can only get the missus to let me spark up a stogie in the house, I’ll be set for a few hours.