Might be interesting to have some thoughts on inflation, and where it starts....while we try not to watch the market...and have included an article from Reuters today re the current excuses...errr...reasons for the red again today....In particular, it's hard to see what's happening to GNET, a company that is doing things for the right reasons....
Re inflation...
Does it start with rising commodities ..i.e. oil.....do we as a nation need to now seriously consider drilling again for Alaskan oil....?
Do rising taxes continually make it necessary for all adult members of a household to work in the marketplace in order to survive....? If the taxes were less, it would seem that some of the inflated costs would diminish...less expensive clothing, daycare, fast foods, cleaning bills, gas and oil, and perhaps fewer cars, etc etc etc....
Have the welfare costs gone down as the unemployment rate has gone down? Have any in the press checked these numbers, and published them?
The costs of property, both commercial and residential, have dramatically increased in this area....(Seattle)...which in turn dramatically increase the cost of everything related to these properties.....more inflation....
And I'm sure that all of you have questions, and other pertinent info to bring to the table....
Best, KLP
Stocks Dive Deeper Amid
Lackluster Volume
By Kristin Roberts May 19 1:56pm ET
NEW YORK (Reuters) - U.S. stocks slid some
more in early afternoon trading on Friday after
another report suggested that Federal Reserve
action has failed to sap voracious U.S.
consumer demand.
Technology and financial shares rolled back
along with transportation names that lagged on
high oil prices.
But volume was again lackluster as uncertainty
surrounding future interest rate increases by the
central bank and a lack of broader sector-wide
news left investors feeling the need to just wait
and see, analysts and traders said.
By early afternoon, the Nasdaq composite
(.IXIC) dropped 154 points, or 4.38 percent, to
3,383, led lower by top technology names along
with computer-chip, Internet and biotechnology
stocks.
Intel Corp. (INTC.O), the world's biggest chip
maker, lost 5-3/8 to 118-9/16, pressuring both
the Nasdaq and the blue chip Dow Jones
industrial average.
The Dow (.DJI) fell 187 points, or 1.73 percent,
to 10,590 after barely holding its head above
water on Thursday. Financial, automotive,
telecommunications and consumer products
stocks all pulled on the gauge.
Broader measure of the market were also
beaten back with the Standard & Poor's 500
index (.SPX) down 35 points, or 2.45 percent, to
1,401 and the Wilshire 5000 (.TMW) down 346
points, or 2.61 percent, to 12,933.
``The Street's held hostage by the Fed,'' said
Adam Weisman, managing director at Wit
SoundView. ``That's the bottom line. There is
plenty of cash out there but nobody wants to
deploy it yet and I don't blame them.''
Before the market opened, the Commerce
Department reported that the U.S. trade deficit
hit a record $30.2 billion in March as prices of
imported oil rose to levels not seen since the
Gulf crisis of 1990.
By afternoon, the crude oil contract for June
eased just 60 cents to $29.73 per barrel.
``We are still getting adjusted to the Fed being in
tightening mode,'' said Pierre Ellis, senior
economist at Primark Decision Economics.
``The trade numbers are strong. The Fed has to
be concerned about the growth of demand.''
Confirming that the Fed is worried, New York
Federal Reserve President William McDonough
said in a speech in New York on Friday that
demand is still too strong and that the increases
in interest rates are aimed at restoring a better
balance between supply and demand.
Friday also marked a ``double witching'' session
or the simultaneous expiration of options and
index futures, which can raise volatility.
Trading was slow and the New York Stock
Exchange saw 556.11 million shares change
hands by early afternoon while the Nasdaq
logged volume of 888.39 million shares.
Analysts said the Wall Street was consumed
with debate over just how high the Fed would
jack up interest rates before it was comfortable
that inflation would not seep into the economy. Its
rate-setting committee meets again in late June.
Late June also marks the end of the second
quarter of the year, setting the stage for another
earnings reporting season.
``So everybody is going to start placing bets as
we get closer,'' SoundView's Weisman said.
``That's when it will start to pick up. Right now, in
the middle of May, it's too early to know what the
second-quarter earnings are going to look like.
It's too early to know what the Fed is going to do
or how much it's going to do. So under that
umbrella, that's why you see volume here so
little.''
With little to guide the market, analysts said Wall
Street was focusing on the trade deficit figures,
which surpassed the $29.4 billion that
economists polled by Reuters had expected.
In addition, U.S. workers logged on to their
computers on Friday to find out that a more
virulent strain of the ``Love Bug'' virus that swept
the world earlier this month had begun infecting
systems anew.
Bond prices turned around on the weakness of
stocks, with the 10-year U.S. Treasury note
rising 9/32. Its yield, which moves in the opposite
direction, slipped to 6.50 percent from
Thursday's close of 6.54 percent.
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