Daylight Savings Linkfest: Week in Review

That was a helluva week, if I may say so myself — only the Nasdaq managed to close in the green. The rest of the major indices succumbed to $96 Oil, and a recognition that the Fed is done for the foreseeable future.

Hotnot_20071102By the numbers, all of the dollar denominated commodities rocketed in response the the Fed’s largesse:As the greenback feel nearly 1%, Crude Oil gained 4.4%, Gold was up 2.7%, and Commodity Futures tacked on 2.0%. All manner of bonds made marginal gains.

European stocks lost a percent, the Dow slipped a point and a half, while the SPX dropped 1.7%.  The big losers wee the Russell2000, which shed 2.9%; REITs got shellacked again, sliding 4.2%. For the past 52 weeks, REITS are now down 1.4%.

Barron’s Trader column quoted William Priest, chief executive of Epoch Investment Partners:

"We’re in the third or fourth inning in terms of financial-sector problems," he says. While modest earnings growth could drive stocks up 6% to 8% over the next 12 months or so, Priest sees "potholes all over the place," including the worsening credit and housing markets. Late Friday reports of an emergency Citi board meeting this weekend, and pressure on American International Group (AIG) to boost shareholder value only added to investors’ concerns.   

Where to begin this week? The Fed? Yields?
The VIX? No matter — we got it all


Fed Cuts, Signals Markets Don’t Look for Another: Federal Reserve officials did what financial markets demanded by cutting their target for the overnight lending rate by a quarter-percentage point, to 4.5 percent.The demand was in the form of a near unanimous expectation that such a cut would be forthcoming, with the prospect of a severe adverse market reaction if it wasn’t. (Bloomberg)

Market Pros remain Bullish: ON WALL STREET, THE SUMMERTIME BLUES have given way to the fall blahs. The housing market is crumbling, the credit market is stumbling, and stocks are tumbling from the highs they reached last month.Given this worrisome backdrop, it’s no surprise America’s money managers remain cautious about the investment outlook for the months ahead. Just 47%, or fewer than half of the professional investors who responded to our latest Big Money poll, say they are bullish or very bullish about the prospects for stocks through the middle of 2008, a reading nearly identical to last spring’s level of bullish sentiment, but well below the 64% of managers who were bullish a year ago. Indeed, 55% of our respondents think the market is fairly valued at current levels, while another 22% consider stocks overvalued. (Barron’s)   

Financials Are Eating Dust of Tech: With two months left in 2007, the winners and losers
on Wall Street are shaping up. Technology stocks have taken the lead
down the stretch. At the back of the pack: financials. Why are tech stocks outpacing financials? In a word: earnings. Technology stocks have been shooting higher amid strong earnings growth
– and expectations are that their earnings will keep rising. The
third-quarter earnings-growth rate for tech stocks in the Standard
& Poor’s 500-stock index is estimated at 15%, based on results
already reported and projections, according to Thomson Financial. That
would be the strongest gain by any sector. (Wall Street Journal)

WTF?  Google is now the #5 company in the USA by Market Cap   

The Week That Shook the Financial Sector: FOR INVESTORS IN FINANCIAL STOCKS, last week was one to forget. Too bad the throbbing pain in their wallets wouldn’t let them clear it from their memories. The week started badly with the ouster of Stanley O’Neal, the CEO on whose watch Merrill Lynch stumbled into an $8 billion write-off. It worsened as the financial sector led stocks down in a brutal post-Halloween pummeling that particularly punished companies like Washington Mutual, Ambac Financial Group and MBIA. And it didn’t end well, amid persistent suspicion that more bad news is lurking. (Barron’s) if no Barron’s sub, go here.   

 Is EMC still undervalued?

Bill Gross on the credit crunch at Citi: Shadow Dancing:  Citigroup’s Chuck Prince was a dancer. Not by profession mind you, or even as an amateur Foxtrotter with the Stars on ABC. Prince danced with subprime mortgages and the financial conduits that contained them. “As long as the music is playing,” he foreswore in early July, “you’ve got to get up and dance. We’re still dancing.” Prince’s observation may not top that of Irving Fisher in 1929 who proclaimed a permanently higher plateau for the stock market, but it will suffice for a generation of modern day investors and their iconic leaders who should have known when to exit the floor. He – they – dance no more with their subprime partners. Still, someone had to be the last to know that the music was over and to be caught when Jim Morrison’s proverbial lights were dimming, if not flickering out. And to be fair, there were millions of dancing investors still on that floor when the unraveling of Bear Stearns’ hedge funds gave the party its first hint that this was going to be the last dance.  (PIMCO) 

Does "Sell In May" still work?   

The new math of oil: We’re hard-wired to tremble when oil prices
rocket, and the past few weeks have looked like another example of why.
Whenever stocks fell sharply, as they did several times, traders blamed
the fast-rising price of oil. But that chain of logic is
misleading. The bigger picture shows that the relation between oil and
the economy is changing, and we’ll have to rewire our brains to
understand what’s happening. Watching oil prices rise and fall is no
longer enough; the key now is understanding why they’re moving. (Fortune)

What’s the Real Reason for the SIV Rescue Plan — to Rescue Citibank?      

• A Hulbert Bond two fer:

-Bond market’s faith restored?:  How will long-term interest rates react if the Fed cuts short-term rates, as the market is now almost universally expecting? To some, answering this question will seem obvious: Don’t all interest rates – both short and long-term move up and down more or less in tandem? Well, not exactly . . . (MarketWatch)

-Long-term inflation?  Bond market sees Fed’s rate-cut as inflationary: The bond market’s immediate reaction to the Fed decision, when long-term rates rose, is the one to which we should pay attention when assessing what it thinks the rate cut means. That would mean that the bond market is saying that lower short-term rates will have long-term inflationary consequences. (MarketWatch)

Bill Miller of Legg Mason Value Trust has an interesting letter to Shareholders    


The Wall of worry continues to build:

I Call "Shenanigans" on GDP! If you believe that Q3 GDP was 3.9%, I have a bridge in Brooklyn you may want to buy . . .  (also, Northern Trust looks at Durable Goods)

Inflation — Lessons From History: Inflation expectations are currently very low, but history teaches us caution. Investors believe the benign low-environment will prevail for many years to come, as evidenced by survey-based and market-based inflation expectations. We have scrutinized 187 years of consumer price data for the US, the UK and Germany and drawn three conclusions . . . (Morgan Stanley)

• By now, you know that the Non Farm Payroll was +166k; but do you know how this data set has been put together, and how this cycleit differs from prior recoveries: Delving Deeply Into the Data of NFP Day.

The return of price controls: Price controls haven’t been completely vanquished. Rather, they’ve lain
dormant, waiting to be revived by the strong odor of inflation. Several
years of synchronous global growth, powered by surging economies in
Asia and dissolute monetary and fiscal policies (thanks, Messrs.
Greenspan and Bush) are combining to push prices higher. The United
States has dealt with the rise of inflation in a typically American
way—by spinning it out of existence. If you ignore food and
energy—i.e., the things that have been rising for several years and
that have a tendency to filter into other prices—and instead focus on
the core rate, the conventional wisdom goes, inflation is utterly under control. (Slate)

Prisoners of Debt: A fresh start with bankruptcy? Big lenders keep squeezing money out of consumers whose debts were canceled by the courts  (Business Week)

• Now we know Argentina is in trouble: Fernández, to copy US inflation data methods Cristina Fernández, Argentine president-elect, has vowed to restore credibility in the country’s official inflation figures by copying US data-gathering methods, in an attempt to calm fears about government manipulation of statistics. (FT)


What will World War IV cost?  First, let’s clear the air: Someone please tell the White House we’re already fighting World War III. Yes, they’re great at picking buzzwords, but the truth is our global "war on terror" has engaged (or enraged) every nation on the planet. And according to the latest Congressional Budget Office estimates it’s costing America a whopping $2.4 trillion. That’s $8,000 for each of us. So what’ll the coming WWIV add? And how will it impact your retirement? Scary huh!   (MarketWatch)

The War on the Unexpected

A Washington official dares to tell the truth: Washington is bankrupting future generations. The longer we wait to
address the $9 trillion national debt and ongoing annual budget
deficits, the more taxes our children and grandchildren will have to
pay, says David M. Walker, comptroller general of the United States,
head of the General Accountability Office and just about the only
public official in Washington these days telling the truth about the
country’s fiscal situation. We’re basically taxing future generations
without representation (because they can’t vote or haven’t been born),
which he says is immoral. (Baltimore Sun)   

War Plans: United States and Iran: A possible U.S. attack against Iran has been a hot topic in the news for many months now. In some quarters it has become an article of faith that the Bush administration intends to order such an attack before it leaves office. It remains a mystery whether the administration plans an actual attack or whether it is using the threat of attack to try to intimidate Iran — and thus shape its behavior in Iraq and elsewhere. Unraveling the mystery lies, at least in part, in examining what a U.S. attack would look like, given U.S. goals and resources, as well as in considering the potential Iranian response. Before turning to intentions, it is important to discuss the desired outcomes and capabilities. Unfortunately, those discussions have taken a backseat to speculations about the sheer probability of war. (Stratfor)



The Next Microsoft: Google is learning too well from the master: This week I want to point out where Google is screwing up, why, and what they should do about it. My first point is small but significant. If you are a resident of the U.S. you may have used a service called or 1-800free411. It is a simple service that looks up directory listings for free, saving callers fees of a dollar or more per inquiry. You can look up listings online, but most people call the toll-free number. Where free411 makes its money is by forcing users to listen to an ad before they get the number they are looking for. The service is incredibly successful averaging more than 25 million calls per month.  (Cringely)

Free Music Now!’s Plan to Give Songs Away Could Upend the Industry  (Wired) 

• The Undiscovered Planet  Microbial science illuminates a world of astounding diversity.    

After smart weapons, smart soldiers: Irregular warfare may keep Western armies busy for decades. They will
have to adapt if they are to overcome the odds that history suggests
they are up against. (The Economist)

Big Picture Reader Survey:  More than 2000 readers participated in this financial blog survey; the results were rather intriguing . . . 


Holiday Book Shopping all these articles about Wal-Mart Stores cut prices on 15,000 items for the holidays has me thinking about getting an early jump on Christmas shopping. I’ve only just begun thinking about some gifts, when I came across these few books that look intriguing;

• Big Head Todd is giving away their new CD for free, in exchange for an email address.

• Jerry Seinfeld’s response when Larry King asks if the show Seinfeld was canceled (Can someone get a resume in here?)


• Wired’s Saddest Cubicle Contest has a winner, and its pretty pathetic

That’s all from here — remember, that Daylight saving time ends Sunday, so no matter what your alarm clock says, you just gained an hour of sleep Monday morning . . .


Got a comment, suggestion, link idea? Or do you just have
something on your mind?
The linkfest loves to get email!  If you’ve got something to say, the by all means please do — send email to thebigpicture AT optonline DOT net.

Category: Financial Press

Five Days of Misery

Category: Corporate Management, Credit, Finance, Markets

Friday Night Jazz Film Soundtracks

Oh, goody, yet another list. How f$%&ing original!

For some silly reason, there seems to be all this hoo-haa about the silly Vanity Fair article on the top Movie Soundtracks of all time.

These people are wankers for many reasons: 1) The VF weenies press released to death; b) the article is not even available on line; iii) the editors chose Purple Rain as the greatest film soundtrack of all time.

I remain convinced that the purveyors of these annoying lists select a controversial top pick to generate buzz (tho’ you would think this would might encourage online posting).

Regardless, let’s not play into their hand. Rather than waste too much time telling you how clueless VF’s music editors are, or giving them any linklove, I would rather — in the spirit of Friday Night Jazz — compile a worthwhile list of films and soundtracks for your perusal.

A few ground rules:

• We are looking for outstanding soundtracks to outstanding films. (Merely o.k. doesn’t cut it).

• Groundbreaking films, soundtracks and performances get bonus points. (Mediocre performances get cut).

• Better non-film versions take points away from the movie soundtrack — where there are superior versions such as the Broadway soundtrack (i.e., Hair, Jesus Christ Superstar, etc.) than those flicks don ‘t make the cut.

• Pure adaptations of Broadway shows also get cut. In my mind, Cabaret, Chicago, Chorus Line are more filmed stage productions, rather than pure movies. (as forewarned, totally subjective).

Hence, several films that I love failed to make the cut: Apocalypse Now is fantastic in the way it uses music (especially The Doors’ The End, and Wagner’s The Ride Of The Valkyries), but its not great as a standalone soundtrack; the wonderful My Fair Lady, with Rex Harrison’s mediocre voice, and the dubbing of Audrey Hepburn’s voice, also doesn’t make the cut.

These things are totally subjective, and are rarely based exclusively on mere merits. Pink Floyd The Wall was a great album so overplayed when I was in
college, that I simply couldn’t pull the trigger on it (the film is a bit
ponderous to boot). Again, these things are very subjective.

Alternatively, the film can’t suck. The greatest
soundtrack in the world becomes irrelevant if its attached to a film
like, say, Hedwig and the Angry Inch — a play that sucked two hours out of my life that I will never get back, and will literally regret on my death bed.

We can certainly debate the order of any list, or the contents, and we probably will (thats what the comments are for).

Here’s my subjective top ~20:

1. A Hard Day’s Night:  A brilliant film and album that both remain as energetic and fresh today as they were in 1964. The Beatles personalities were perfectly suited to the medium, so much so that its hard to imagine a better film/soundtrack combo.

: A Hard Day's Night

A Hard Day’s Night

If you want to consider another Beatles sound track, both Yellow Submarine and Help! are fun — but neither rise to the sheer genius of A Hard Day’s Night. 


2. Stop Making Sense:
Quite simply, the best concert film ever made. Yes, some of you will
declare The Last Waltz, (with a few stragglers nominating Woodstock)
but there is simply nothing else that ha the combination of
showmanship, musical innovation — and the big suit — like this film
does. Marvelous.

: Stop Making Sense

Stop Making Sense


3.  Blade Runner: Forget the ponderous and boring Chariots of Fire, THIS is Vangelis Masterpiece. Not only is the music hauntingly beautiful, but it fits the filmscape so perfectly, making it even better than it originally was. We’ve already spilled so many words about BR, that the less said the better. "All those moments will be lost in time, like tears in rain." 

: Blade Runner

Blade Runner


4. The Rocky Horror Picture Show:
I could try to explain this, but I couldn’t do it justice. Find a
theater where this is playing at the midnight show, and go with someone
who’s gone before. Repeat.

: The Rocky Horror Picture Show (1975 Film)

The Rocky Horror Picture Show (1975 Film)


5. The Graduate:
Not only is this a seminal, groundbreaking film, but the soundtrack is
phenomenal. The way the various songs are interwoven into the action,
mood, psyches of the players is amazing (listen as Benjamin’s Alpha Romeo Spider runs out of gas).

I don’t know if Mike Nichols is
a genius, or just got incredibly lucky. Either way, its a great
soundtrack and a great movie.   

: The Graduate (1967 Film)

The Graduate (1967 Film)


6.  Harold and Maude:
One of the most subversive, outrageously amusing black comedies ever made — hysterically funny to boot. Cat Stevens (before he became Yusaf)
created a wonderful collection of songs that enhance the story line’s mood and emotions.  This is, quite bluntly, one of the
funniest films ever made.

: Harold and Maude

Harold and Maude


7. Garden State:
My "surprise" entry. A charming little film with a soundtrack that simply
refuses to stop delighting you with its lovely tunes and ballads, nearly all of which are by bands that
prior to this soundtrack were relatively unknown. This disc was played constantly in the car in 2004/05.

: Garden State

Garden State


8. (tie):Led Zeppelin, The Song Remains The Same
The Who, The Kids Are Alright:

Perhaps its my age showing, but I have always found each of these to be tremendous films and soundtracks. The Zep concert film was utterly ground breaking, and I must have seen it a zillion times after they broke up; The Who film was a fantastic documentary.

: The Song Remains The Same (Remastered / Expanded) (2CD)

The Song Remains The Same

: The Kids Are Alright

The Kids Are Alright


10. Fantasia: Music by Tchaikovsky, Moussorgsky, Stravinsky, Beethoven, Ponchielli, Bach, Dukas, and Schubert. ’nuff said.

The film was groundbreaking in many ways, including the innovative
use of animation and stereophonic sound — but its the overall approach
that has been so enduring:  Allow the Disney animators tointerpret Classical music. The results are both playful and surreal. Its amazing how well this has held up after 60 years . . .   

: Fantasia (Special 60th Anniversary Edition)

Fantasia (Special 60th Anniversary Edition)


11. Pulp Fiction: The film does so many things so well — but the way the music is integrated into the actual plot is simply terrific.  Plus, Travolta and Uma can each dance. 

: Pulp Fiction: Music From The Motion Picture

Pulp Fiction: Music From The Motion Picture


12. West Side Story:
Leonard Bernstein’s musical update of Romeo and Juliet. The combination
of Stephen Sondheim brilliant lyrics, the kinetic choreography and the
bravura camera work made for a fantastic wide screen film. The
soundtrack created the perfect counterpoint to the dance and action.

Sure, its a bit dated (hence, #10), but it remains an all time great.

: West Side Story

West Side Story


13.  Purple Rain: There is no doubt that the purple one can sign, dance, play guitar — but Acting? Not so much.

Regardless, his sheer overwhelming talent is why this manages to get onto my top 15.

True Story: I saw this in the theaters in college, and my remark was "He’s going to be bigger than Michael Jackson" — who was huge at the time.

Its a toss up how right that call was, but the general concept was dead on . . .

: Music from the Motion Picture "Purple Rain"

Music from the Motion Picture "Purple Rain"


14. Little Shop Of Horrors: A fantabulous musical/horror/comedy. It’s all a whole lot of fun, and the musical styles range from honky-tonk to doo-wop to straightforward rock n’ roll. The strength of the film carries what otherwise might have been a mere Broadway adaption into an entire different level.

: Little Shop Of Horrors (1986 Film)

Little Shop Of Horrors (1986 Film)


15. Koyaanisqatsi: A quasi-documentary, this film has been described as "visual concert of images" or a "filmic landscape." The reason its here is the hauntingly beautiful music of Phillip Glass. A classic college flick . . .

: Koyaanisqatsi - Life Out of Balance

Koyaanisqatsi – Life Out of Balance


16. Saturday Night Fever: One of those seminal films that tremendously influenced the culture.

My choice in music was rock-n-roll, and I had little interest in blow-dried hair, white polyester suits, or cruising discos looking to pick Staten Island bimbos.

The music works as well on its own, but it also works as a classic piece of pop history. (And John Travolta makes the list twice!)

: Saturday Night Fever: The Original Movie Sound Track

Saturday Night Fever: The Original Movie Sound Track


17. The Tao of Steve: Another charming little film that surprises with its wonderful songs. A fun amusing, philosophically oriented film, with a soundtrack to match. For you Outdoor Types.

: The Tao of Steve: Original Motion Picture Soundtrack

The Tao of Steve: Original Motion Picture Soundtrack


18. All That Jazz: The Oscar winning soundtrack by Ralph Burns includes jazz, classical, pop, and Broadway standards. Its a marvelous mix that works to great effect in the film.

Can you imagine anyone other Director making so self-critical autobiographical film other than Bob Fosse? While some have criticized the film as a  rip-off of Fellini’s 8 1/2, my favored descriptions of All That Jazz is "the musical version of Apocalypse Now." If you can imagine that, you have a better sense of what the film itself is like.

: All That Jazz (1979 Film)
All that work. All that glitter. All that pain. All that love. All that crazy rhythm. All that jazz.

All That Jazz (1979 Film)


19. The Big Chill:
The Motown dominated score was one of the most artistically skillful –
and commercially successful — uses of pop ever set to a film.

More than merely setting a time and place, the soundtrack has a
wispy nostalgia for a prior period in the players’ lives. Subsequent
attempts by other movies have been less successful of creating a look
back from a specific time to another one;  e.g., I think of the Forrest
Gump soundtrack as Big Chill 2.

: The Big Chill - Deluxe Edition

The Big Chill – Deluxe Edition



20.  South Park – Bigger, Longer & Uncut: You will laugh until you piss yourself. This one squeaks in at #20 because the soundtrack is so very, very funny. 

: South Park - Bigger, Longer & Uncut

South Park – Bigger, Longer & Uncut


Thats my top list; A few Honorable Mentions are after the jump . . .

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Category: Digital Media, Film, Friday Night Jazz, Music

Would You Like that all in money?

Category: Credit, Currency, Federal Reserve, Finance

Results: Big Picture Reader Survey

As promised, here are the results of the survey we did on Monday.

Thank you again to everyone who participated in this survey: Over 2000 of you responded, and the results are quite intriguing. Kudos to Survey Gizmo for putting together a nice product — very simple and easy to use. (I am sure I could have done a better job if I actually read the instructions)

In many cases, I did not show the full set of answers — too many one offs to fit neatly on a web page . . .  but where possible, I gave the top few answers, down to ~1%.

When someone asked me "Who are your readers," I could only answer in the most general of terms. Michelle over at Footnoted suggested doing a survey, and hence, here we are.


This was quite an interesting experiment; Please feel free to make suggestions for other ideas/questions/quiz ideas/concepts in the comments.   


Long ass page continues after the jump . .  .

Read More

Category: Data Analysis, Weblogs

NFP +166k

Category: Employment

Delving Deeply Into the Data of NFP Day

Category: Data Analysis, Employment

Now we know Argentina is REALLY in trouble

Category: Financial Press, Inflation, Taxes and Policy

Oil at $96, Gold at $800 (Fed belatedly worried about inflation)

Category: Economy, Federal Reserve, Inflation, Markets

Quote of the Day: Wall Street Tantrums

Category: Federal Reserve, Financial Press