Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: zonder who wrote (13518)	10/15/2004 12:32:16 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

High oil has cut growth, Greenspan WASHINGTON (CBS.MW) -- The rise in the cost of imported oil has already had some negative consequences on the economy this year, Fed chair Alan Greenspan said. "So far this year, the rise in the value of imported oil - essentially a tax on U.S. residents - has amounted to about three quarters of one percent of GDP," Greenspan said in a speech exploring many issues surrounding oil prices prepared for delivery to the National Italian American Foundation. Although this is a noticeable impact, it is "likely to prove less consequential to economic growth and inflation than in the 1970s," he said. Greenspan said the risks of more serious negative consequences would intensify if oil prices were to move "materially higher." The Fed chairman rejected theories that the world will soon run out of oil. cbs.marketwatch.com

To: zonder who wrote (13518)	10/15/2004 12:44:07 PM
From: mishedlo	Respond to of 116555

Justice Dept. gets documents on Snow´s GSE investments Friday, October 15, 2004 4:36:24 PM afxpress.com Justice Dept. gets documents on Snow's GSE investments WASHINGTON (AFX) -- The Justice Department has received documents provided by Treasury Secretary John Snow to the Senate Finance Committee relating to possible conflicts of interest in Snow's investments in government-sponsored entities, including Fannie Mae and Freddie Mac , Sen. Max Baucus, D-Mont., said Friday. Snow held the $10 million investment in GSE bonds for 16 months while he was involved in decision making about regulation and oversight of the companies, Baucus said.

To: zonder who wrote (13518)	10/15/2004 1:12:55 PM
From: mishedlo	Respond to of 116555

Election 2004: State of the Races Charles Cook Cook Political Report Editor Monday, October 11, 2004; 10:00 AM This very interesting article disputes most of the polls. washingtonpost.com Mish

To: zonder who wrote (13518)	10/15/2004 1:38:47 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

G.M.'s announcement spoke volumes about the impact of the health care system on domestic manufacturers' competitiveness. John M. Devine, the chief financial officer, suggested that the company would increase its health care inflation projection to "double digits" annually from the current 8.5 percent, which would most likely reduce its 2005 earnings by hundreds of millions of dollars because of rising costs next year and larger payments to retirees in the future. Mr. Devine also said that G.M. would probably have to pay more than the $5.1 billion estimated this year to cover health costs for workers and retirees. G. Richard Wagoner Jr., the chairman and chief executive, said in a conference call on Thursday: "The health care cost trends in the U.S. are really out of control. It's a big issue for G.M.; it's a big issue for the U.S. economy as a whole." Increasing health costs put domestic automakers at a considerable disadvantage to competitors in Japan and Germany. G.M. spends about $1,400 for each vehicle produced in the United States on health care, a figure it says is about $1,000 more than Toyota. It provides coverage to 1.1 million Americans, including workers, retirees and families. By contrast, automakers based in Germany and Japan have retirees who live mostly in countries with national health systems. "This health care situation could get out of control," said Stephen Girsky, an analyst at Morgan Stanley. nytimes.com ------------------------------------------------------------------------------------------------------------------------------------------------ An article in the NYTimes was referenced in a post by luv2earn yesterday which reported that: In two reports, the Nordic countries bested some of the world's hottest economies. The countries dominate the top ranks of a list of most competitive economies in the world, and a new report of the best places to do business. ----------- So why don't people automatically mention Denmark and Finland when conversations turn to development success stories or good financial bets? "It's that old myth that social protection requires more business regulations and hurts business," said Caralee McLeish, an author of the World Bank survey. "In fact, we found that social protection is good for business, it takes the burden off of businesses for health care costs and ensures a well-trained and educated work force.' ------- Simeon D. Djankov, one of the authors of the World Bank study, said the governments' philosophies were to let businesses alone, taxing them at some of the lowest levels in the world so they can be competitive and efficient. The governments then put high taxes on personal incomes to pay for social services that underwrite their labor forces. "You have to look behind the numbers," Mr. Djankov said. "Ignore the Nordic reputation for tax burdens and you'll see they have established a system that does not distort production, that gives people an incentive to invest in businesses and in stocks because the corporate taxes are so low.' nytimes.com ------------------------------------------------------------------------------------------------------------------------------------------------ There seems to be a potential alliance between those that want universal government health care for altruistic reasons and US industry that needs to regain international competiveness. As someone who lives in a country that provides excellent universal health care, it's not just a question of who pays but recognotion that the US system is far too expensive and wasteful for what is provided. What is desperately needed for economic reasons is a restructuring of health care provision in the US.

To: zonder who wrote (13518)	10/15/2004 6:21:17 PM
From: mishedlo	Respond to of 116555

Euro could flirt with $1.27, but not on its own merits Friday, October 15, 2004 7:56:22 PM afxpress.com CHICAGO (AFX) - The euro rallied Friday to $1.25 for first time since March 1, but the currency's near-term fate still lies more with the dollar than its own strength, say analysts The U.S. goods and services trade "deficit has come back closer to the center of the radar screen. After all, we've had Federal Reserve officials mentioning it recently," said Ronald Simpson, a currency analyst at Action Economics. Trade-related dollar pressure could keep up demand for the euro. Yet there remains little economic backing for a rising euro, say analysts. Euro-zone economic growth continues to lag behind the U.S. and Japan The International Monetary Fund expects euro-zone economic growth at 2.2 percent this year, U.S. economic growth at 3 percent and Japanese economic growth at 4.4 percent "The euro-dollar pair is increasingly becoming a gauge of weakness rather than strength," said Ashraf Laidi, chief currency analyst with MG Financial Group "Interesting. All the major [currency] pairs are at my month-end forecast, but I think I'll stick with it," he said. "I see the euro rising as high as $1.2550 for the month, and potentially hitting $1.27 by year end." After several failed attempts at an upside breakout, the euro had been capped by July's high near $1.2460 over the past several months Friday offered a different scenario Mixed economic results out of the U.S. followed the dollar-negative trade deficit report on Thursday. But one of the day's first reports, which showed a September retail sales gain that doubled forecasts, "caught the market wrong-footed," said Simpson The reaction in the currency market cheapened the euro just enough to invite a new round a buying. That buying in turn triggered a wave of options-related orders and once the summer high was pierced, investors who trade solely based on technical charts joined the fray. The result was a multi-month high for the euro European Central Bank President Jean-Claude Trichet said in a Bloomberg interview Friday that the eurozone economy faces increasing risks due to rising oil costs. Other officials have said those risks may include rising inflation Oil crossed into record territory above $54 a barrel this week. The ECB's interest-rate target lies at 2 percent. After three U.S. rate increases, the ECB's target is now only a quarter of a point above the U.S. Federal Reserve's 1.75 percent benchmark rate. In other words, the yield advantage that euro-based investments hold to dollar-based investments is shrinking "The economic data out over last couple of weeks doesn't make you want to run out and buy euros, [the U.S. is] still hands down looking better than they are," said Simpson Euro-zone second-quarter GDP rose just 0.5 percent from the first quarter, the Eurostat agency reiterated in its second estimate for the quarter, released earlier this week Private consumption slowed to 0.3 percent from 0.7 percent in the first quarter, while exports rose to 3.1 percent from 1.6 percent But the export market could be compromised by a rising euro, since it makes euro-zone goods more expensive on the world market But it goes without saying that investors have turned to the euro as a defensive currency amid global growth uncertainty and may continue to do so Rising oil, for instance, has been mildly euro-supportive, only because the dollar and the yen were hit that much harder. Japan and the U.S. have to import their oil and are also seen at greater risk should steep energy bills damp consumer spending. "As this week's data showed such weakness to be deepening in the United States, currency traders have no choice but push the dollar down off the range against the euro," Laidi said. "Last week's payrolls report exposed doubts in U.S. labor market, while yesterday's release of the deficit figures exposed the shaky external imbalance of the United States. The protracted negatives in the U.S. dollar are shadowing sluggish growth conditions in the eurozone." Simpson said the next area on the technical charts of significance for the euro is around $1.2540 to $1.2550. A break of that range would invite a test of $1.26 and after that, the door is easily opened to $1.27 But he suggests, "We won't hit $1.27 next week. We'll consolidate on either side of $1.25 for now." But, says Simpson if the currency market chooses to again make the U.S. deficit the dollar's bane, the greenback could be in store for a revisit of the all-time euro low and the 3 1/2-year yen low hit in mid-February

To: zonder who wrote (13518)	10/15/2004 6:30:00 PM
From: mishedlo	Respond to of 116555

Study sees 406,000 U.S. jobs shifted overseas in 2004 Friday, October 15, 2004 8:13:52 PM afxpress.com WASHINGTON (AFX) -- Outsourcing of U.S. jobs to China, Mexico and other low-wage economies continues at an accelerating pace, according to a new study released by the U.S.-China Economic and Security Review Commission. The study found that 406,000 jobs are likely to be shifted overseas in 2004. The data was collected by tracking stories in the media. The authors of the report said there is a "vital need" for new government regulations to require companies to report when they move jobs out of the United States