Good morning all! I was out of town all weekend and trying to get caught up on everything, so I will be brief today. Last week's market action brought some interesting developments. On the heels of the QE2 announcement and the election results we had our first down week in the market, which broke a string of five consecutive up weeks and new market highs for the year. This past week the S&P was down nearly 2%.
After going virtually straight up since early September, where do the markets go from here? Is it buy the "dip" time (a baby one at that) or do we continue to drift lower from here into year-end? Or is a major correction looming? Call me crazy, but the one year charts look a bit "frothy" (hat tip Greenie) or "toppy" to me. Take a look.
S&P One Year Chart
So how do we end the year? Will Santa make a his annual appearance in the markets so fund managers can pretty up their annual client statements, or will there be coal in the bulls' stockings for the holidays?
CAD is catching a bid from Europe, Asia, U$D and even AUD at the moment. So risk is on right now. POMO all this week. Problems with Irish banks. Munis bonds in trouble.
ReplyDeleteI Can
So, maybe there is a rotation going on here, from Asia back to the U.S., that's why U$D and CAD both catching a bid.
ReplyDeleteI Can
Morning all.
ReplyDeleteThis will change everything, again!
ReplyDeletehttp://www.businessinsider.com/apple-teases-secret-surprise-tomorrow-is-a-day-that-youll-never-forget-2010-11
@greg:
ReplyDeleteWhat's your bet?
Something to do with the television?
ReplyDeleteI already have a TV.
ReplyDeleteLOL emmy. Me too.
ReplyDelete@Manny,
ReplyDeleteI'll let you know my thoughts after I do some homework.
Obviously, the sell off in the bond and muni bond markets combined with the some of the futures markets is a concern.
ReplyDeleteLook at lumber go!
Www.macrumors.com
ReplyDeleteSent from the highway 10 parking lot in lovely Rosemead California
Lumber
ReplyDeleteThe fact that the stock market is a discounting forward looking entity means that much of the improvements in the economy are already priced in.
ReplyDeleteThanks Denise. Might it also be "priced in" and then some? After all, in these bubble environments, we've seen A LOT of this in the past couple of decades since Greenie started his put.
ReplyDeleteManny,
ReplyDeleteIt is difficult to know how far a market can go as they many times over shoot to the upside or downside but the main point is that the market has advanced and has already priced in improving economic conditions. I know that in my area things are getting gradually better, store fronts are being rented, restaurants are busy again, etc. Not great but improved from last year.
We personally are adding to the economy as we bought windows, replaced rotting wood on the exterior of the house, employed carpenters, painters, and tuck pointers, etc.
ReplyDeleteI have been asking all of the workers how is business and they tell me they are slow but that they are at least working as opposed to last year.
Yeah, I've been seeing that here too, Denise, although there are still quite a few empty store-fronts in some areas. Ann Taylor just vacated a big space near my house. I'm guessing another retailer will fill it, since the location is extremely good, but that one had me raising an eyebrow.
ReplyDeleteStores are still going out of business (chain or small retail) but they are being replaced by other retail outlets, unlike 2008-9 where it was mass closings. Plus many of the vacant buildings are either very run down/bad locations so those will be either fixed up, torn down or stay vacant. We have heard that many rents have been lowered just to get tenants in our town.
ReplyDeleteIt will be interesting to see what happens to store fronts after the Christmas season.
ReplyDeleteAs you all are probably aware, many stores have already started the Christmas season, trying to bring in shoppers with great deals and this is before Black Friday. If a good portion of shoppers spend what little they have before Black Friday that could mean BF is a bust and so will be the rest of the holiday season.
If these stores can not bring in the much needed money during the busiest time of the year, they may have no choice but to close.
Mangy Mutt
Mutt,
ReplyDeleteThat is a very good point. Most of the new stores in my area are permanent, not just filling the spot for Christmas sales, but the malls have those type of filler stores. It will be very interesting to see who leaves after the holidays are over.
Nice little pop we have today.
ReplyDeletePS is busier than I've seen it in years. Looks like the wealthy are back to enjoying their winter vacations.
Denise - Last Christmas season, the downtown area had quite a few empty store fronts, they invinted small business in rent free to fill the vacancies.
ReplyDeleteI thought it was a pretty genious idea, it gave small business a way to cheaply show their wears and filled in dead space.
I do not know if they are doing it again this year, but I know that after Christmas downtown went back to empty stores.
Mutt
Facebook is hitting GOOG right between the eyes. They just announced they will have a new messaging system to permit instant and text messages through Facebook, in addition to email. This gives Facebook users yet another reason to not leave facebook, giving Facebook the ability to charge more for and capture more of the advertising business. That's GOOG's primary revenue.
ReplyDeleteIt may be time to start thinking about shorting GOOG.
Turnaround Tuesday may be the time. I think I'll watch the GOOG action at the close, and maybe short 50 shares or something.
http://uk.reuters.com/article/idUKTRE6AB4WB20101115
@Thor:
ReplyDeleteBTW, what's the difference between "Instant" and "Text" messages (no, this is not a test, I really don't know--I have read all the pubs by the IETF SMS group, and to the best of my understanding, "Instant" and "Text" are the same--The messages are sent in clear text over the internet).
Rock - hahahah. Instant messaging is what you would do on AIM, Yahoo, or MSN Messenger, text messaging is from your phone - from phone number to phone number.
ReplyDeleteI heard about the FB email plan this morning on my way in from work. This will definitely affect gmail I think. I don't know how many of you all use Gmail, but I know a number of folks have problems with the way their email messages are aggregated. Not very user friendly.
Many people are already using the mail program in facebook, as shitty as it is, I'd say almost half my personal email is via facebook mail already. If they improve their mail system in a major way, that's going to immediately be a big sell for them.
Rock,
ReplyDeleteGoogle at the Friday Night Dump
Either they are very optimistic or just very greedy but at least they gave the peons a raise, too.
Google email is a joke. Can't follow the message threads, not well organized. But how much does Google have invested in their email vs. their search?
ReplyDeleteMarket has broken it's intraday uptrend line and is selling off to new tick and momentum lows.
ReplyDelete@Denise: I always thought that search was the biggest key to Google, by far, and that gmail was just an ancillary thing.
ReplyDeleteCSCO continues to make new lows.
ReplyDeleteselling off pretty hard too
ReplyDeleteIf gmail was so key to their success, you'd think Google would invest some $$ into it to make it more user-friendly. This leads me to believe that it's not a big factor, but maybe I'm wrong.
ReplyDeleteBased on it's functionality, I would say they don't care very much about it.
ReplyDeleteGoogle search has turned into a joke. Paid ads by everyone and their brother. The company that pays the most gets top search. I always look for the sites that don't immediately come up when trying to find things.
ReplyDeleteThe Beach Ball Trade might be in hiding for today.
ReplyDeleteIreland says it doesn't need a bailout - does that sound familiar to anyone?
ReplyDeleteHard to make headway with the bond markets so weak.
ReplyDeletere gmail: c'mon guys. I could not disagree less, except maybe for the thread feature which seems awkward at first. I've been using gmail for quite some time now, and find it user friendly all in all. *Good spam filter. *Makes monitoring several accounts painless:I have 5 gmail accounts that sit neatly in their respective frame on the gmail web interface. *Add to this the contacts syncing feature, to and from smartphones.
ReplyDeleteDon't see how it could get much better than this.
As for the markets, I'm still in the correction camp. Last week was a joke, we have lower to go. Maybe after some decent down move, we can rally at the EOY or beginning of January.
ReplyDeleteWolfie,
ReplyDeleteWe are at the day's lows, we will see if we can hold or go lower.
Range bound market. 1192(200day Ma) - 1225 this year highs. Holdiay week this week too.
ReplyDeleteI Can
Not a good sign when they are selling them into the close instead of short covering. Reversal bar.
ReplyDeleteNot to mention falling on good news
ReplyDeleteHere's a link for the Facebook changes.
ReplyDeletehttp://arstechnica.com/web/news/2010/11/facebooks-new-messaging-system-mashes-up-sms-e-mail-im.ars
G-mail is what it is. i've used for over 5 years for personal use. Now work has us in beta use. First thing dropped by me for work use is Threading. Threading just doesn't work in situations where a parent mail spawns many many children using the same Title.
It's different, but you can usually gain a way to get it to work. I hate not being able to copy and paste images straight into an e-mail. Contact information is not a right click away.
Just glad the market is reverting back down to the mean after the QE2 assumptions made last week. Need to keep this range bound til the end of the year.
SP500 10minutes:Neat downtrend started Nov09th. And Dan's Nov17th is coming Wednesday.:)
ReplyDeletehttp://www.businessinsider.com/california-muni-update-november-15-2010-11
ReplyDeleteIs it just me or does Mitch McConnell look an awful lot like the sea turtles from Finding Nemo?
ReplyDeletehttp://www.family-vacation-getaways-at-los-angeles-theme-parks.com/images/TomorrowlandNemoCrush.gif
And what does that say about me that so many people remind me of cartoons? :-/
ReplyDeleteWeak close. I have a hard time seeing what propels this market higher at this point, but then again I've been wrong before, many times, in fact.
ReplyDelete@Thor,
ReplyDeleteMitch McConnell looks like a very old Cabbage Patch Doll.
Cabbage Patch Kid
That turtle is pretty good, too.
ReplyDelete@Manny,
ReplyDeleteIt was an inside day in the SPY but not an inside day in the ticks.
McConnell is not an attractive man. I guess that's why they call national politics "Hollywood for ugly people".
ReplyDeleteI am glad to see the R's have at least in theory agreed to no more earmarks. Now if we could just get the other 99% of the budget nailed down we might be getting somewhere.
ReplyDeleteLOL Denise & Thor. He does look like a mixture of both, although I lean towards the cabbage patch kid, slightly.
ReplyDeleteI wonder if for the men being that unattractive has something to do with their pathological thirst for power (and money). Has to play some role.
ReplyDeleteMen in politics.....
ReplyDeleteManny - I've often wondered that. I'm sure there are all kinds of psychological factors that go into a personal desire to go into politics - few of which these days have anything to do with serving their country.
ReplyDeleteSticks and stones may break my bones, but your words will never hurt me.
ReplyDeleteAnd, what's wrong with looking like a Sea Turtle anyway? You saw Nemo, right?
Mitchie, no kidding and if all you got is the looks of a sea turtle then go for it. At least you are not as smart as one. Right....
ReplyDeleteMangy Mutt
More contagion fears percolating over in Europe? Just delaying the inevitable?
ReplyDeletehttp://www.nytimes.com/2010/11/16/business/global/16euro.html?hp
Manny - This all seems very familiar. Talk or an Irish Default, Ireland saying they don't need help, followed shortly with "oh wait, maybe we do need help". Which will eventually lead to "oh, remember when we said we needed help? uhhhh yeah, we need about 6 times more help than we told you the first time.
ReplyDeleteAll of which, will be followed six months later with Portugal.
Wash, Rinse, Repeat!
Exactly Thor. I wonder if austeritization of the We the Sheeple in the U.S. happens last? Bailouts for bankers and a giant middle finger for the rest of us.
ReplyDeleteGreat passage from that article:
ReplyDelete“This policy of saving banks at the cost of breaking the back of entire countries is a disaster,” said Daniel Gros, director for the Center for European Policy Studies in Brussels. “Ireland is beyond fiscal plans as long as one cannot see the bottom of the losses in the banking sector,” he said. The only way to “stop the rot,” he added, “would be to let the Irish banks go under” and then use the European funds to “tide over the government until markets and the economy recover.”
Manny - I think our austeritization will be a few years coming. Have to give the Plutocracy enough time to recapitalize and get their money into 'safer' assets. I fear we may have lost our chance this time around. We might even have to wait for the next crash. I dunno, I just can't imagine much of anything good coming out of DC anymore.
ReplyDelete**** you, McNabb. And **** you, Snyder, for making yet another over-the-hill big name signing.
ReplyDelete(curls in a fetal position)
That is so bad, Emmy. I'm spoiled as a patriots fan.
ReplyDeleteI feel for you Emmy. I had the joy of living just outside the Beltway for 6 years, including the Spurrier debacle. I had to move on. Snyder is the forever enemy.
ReplyDeletekayem
5. YEAR. EXTENSION.
ReplyDeleteWhat is with the Apple and Google haters? These are two wildly successful American companies, yet it seems there's a sizable subset of the population that wishes it would fail. If I remember correctly, these were the same people wishing GM would hurry up and die.
ReplyDeleteWhat is that about?
"World locomotive"'s stocks going off rails
ReplyDeleteShanghai Composite 2,894.54 -119.88 (-3.98%)
==
"Apple's iTunes announcement “you'll never forget” today is the debut of the Beatles catalog to the music service, according to the WSJ's sources" wow!
what was that again ?..
reThor,Apple/Google haters:I don't think it's hatred. I would call it teasing instead. In the end, everybody will agree that both companies make great products, for the benefit of us consumers.
ReplyDeleteWhich is not the case with the monopoly that is(was?) Microsoft. I believe they have done as much harm(if not more) than good for the consumers.