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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Chispas who wrote (157)	2/17/2004 9:08:28 PM
From: mishedlo	Read Replies (2) \| Respond to of 116555

Prudent bear Stocks and commodities roared ahead while the dollar sank. No problem for the bond market, Treasuries were little changed. The Dow added 87 points or 0.8% while the S&P 500 added a percent, the Nasdaq gained 1.3% and the Russell 2000 advanced 1.6%. The ATT Wireless buyout offer by Cingular was the big story of the day. Cingular wants to pay $41 billion or $15 a share in cash for the company while assuming $6 billion in debt. "snip" Stocks were hardly the only asset class moving higher. Oil futures closed at an 11-month high and above $35. Gold ended up $5.70 at $416.50 an ounce, prodding the Gold Bug index 3.4% higher. Copper rose 5.65 cents, almost 5%, to $1.30. During the day copper hit its highest level in almost 8 years. Silver futures added about 20 cents to close at $6.78.The euro closed near its all time high against the dollar. "snip" Today's Wall Street Journal examines the sentiment behind the job numbers. It appears that more Americans than usual have given up looking for work, or have retired early. The WSJ figures that there are 75 million Americans who no longer work, up from 70 million over three years. Although demographics play some role in the numbers, the percentage of Americans 25-54 who are either working or looking for work has fallen to levels not seen since the late 1980s. "snip" Well here's just what the doctor ordered, more subsidized lending. According to news reports the Small Business Administration wants to lend another $3 billion to provide “entrepreneurs” with credit. The program is being sold as a job-creator. A bill granting the additional lending would also reduce the SBA guarantee to 50% from 80%. Lenders who actually make the loans may not be so keen on the extra risk. "snip" It may not sound as catchy as “dotcom” but if nano is in the name, speculation is the game. The New Jersey paper provides a fine overview of the latest investment craze – nanotechnology. A chatboard quote says it all: "(the nanotech company) is the best Nanotech play going… Nanotech is the wave of the future. "snip" It will come as no surprise that new car buyers are paying more and dragging it out longer. As is their specialty, USAToday sums it up nicely: The average down payment for a new vehicle has been around 3% to 5% for months compared to 15% in 1995. The average transaction price (after rebates) was more than $26,000 recently. Only dealer incentives prevented a world record price. The average loan maturity these days is for 63 months vs. less than 48 months five years ago. In 1997, banks financed an average 89% of a new vehicle's. Last year, it was 101% since consumers borrowed to cover the amount they were upside down on their trade-in. And get this… 40% of all trade-ins involve upside-down car loans. Borrowers owing too much on their cars must be hoping such leniency continues for a considerable period. Read the rest here: prudentbear.com

To: Chispas who wrote (157)	2/17/2004 9:31:16 PM
From: mishedlo	Respond to of 116555

Comment to Mish on Consumer Confidence on my board on the FOOL: Not to get political, and tell me if I am honestly noting a completly non-correlated event here, but can you imagine that consumer confidence has been at all affected by the group of gentlemen making speeches throughout the US about how badly the president has been doing. Mish Reply: Why is the president doing badly? I am going to guess that if jobs were abundant, then Iraq would not seem like the problem that it is. Now, I have said this before and I will do it again: Bush is not responsible for the job mess we are in. However, Bush and Snow and the sec of labor have all promised jobs that are not being delivered while lower unemployment numbers are being touted (primarily due to people falling off the rolls). I do not know who is telling Bush and Snow that we are going to produce jobs, but most on this board would strongly disagree. There is a huge disconnect here, and promising jobs that are not being delivered is not going to inspire much confidence! So.... It all boils down to It's Jobs Stupid, Not the Stock Market! I do not think either the labor secretary or Bush understands that at all. There are a couple of ways to put out that job fire and here they are: financialsense.com Mish note: If you did not click on that link you missed something hilarious. OK, let's not get bogged down in politics cause that last link showed quite clearly that nothing is going to work. And that quite simply is why consumer confidence is down. People are starting to feel like it is hopeless. Let's see if the anger phase causes a bunch of idiotic protectionist measures in response. Mish