Sorry…just noticed I didn’t send out the draft….and after I finished it an hour early! Aarrgghh!! TB
Joke of the Day from the Friar’s Club Encyclopedia of Jokes: “I’m now at the age where I’ve got to prove that I’m just as good as I never was.” – Rex Harrison…must have been younger than TB when he said that…I have given up trying to impress…
Bloomberg Quote of the Day: “Perseverance is not a long race; it is many short races one after another.” – Walter Elliott…or as Aesop taught us: the race is not always to the swift, nor the battle to the strong…but that’s how to bet it!
Bloomberg Top Stories:
*S&P 500 Futures Gain With Stocks After Apple-China Deal; Yuan Gains
*Wall Street’s Failed Dollar Call Redoubled in ’14 on Fed Tapering Decision
*Bull Calls Unite as Europe Strategists See 12% Gain Amid Profit Pessimism
*Carny Smarts Helped by Luck Let Central Banker Redo Even U.K. Housing
*Bitcoin Behaves More as Speculative Investment than Currency, Study Finds – DUH!!!
*Christmas Day Is Black Friday for Apps as Developers See Record Downloads
*Swiss Banks Employ Army of Advisors to Weigh Wisdom of U.S. Amnesty Offer
*Secret Handshakes Greet Frat Brothers on Wall Street as Women Left Behind – heck, TB’s hand shakes and he didn’t even join a fraternity!?!
*Erdogan Pledges to Fight Groups That Seek to Undermine Turkish Government
*Obama Seen Rescued From ‘Near-Death’ Year by Rebound in GDP to Health Care – hello…that was the THIRD QUARTER FINAL!!! Means little to nothing for yearend!
*Israel Taking Steps to Prevent New Immigrants From Shielding Assets
*Wal-Mart to HP Reap Worker Political Donations Through Charities – SICK…quid pro quo…we’ll match your charity if you give same to the PAC..,which serves goals of MANAGEMENT – not the employees…another tax loophole exploited. It never ends!
The FOMC reduced monthly purchases by $10 billion starting in January. They offered “enhanced guidance” that the federal funds rate will stay low well past the time that the unemployment rate declines below 6-1/2 percent. The trend in jobless claims turned, due to fluctuations in filings, around holidays. Regional manufacturing surveys were mixed, though, and suggest a slight increase is possible for ISM. The data picture remains mixed, especially housing. Next week’s economic calendar is fairly light. The highlight of the week will be the November Personal Income (Monday). We will also get December Consumer Sentiment Final (Monday), November Durable Goods Orders, November New Home Sales, and December Richmond Fed Survey (Tuesday). Courtesy of Economic Advisory Service
Friday’s Market Summary:
First, the Dow put in a new record high replacing 11/29’s (monthend) record, of 16174.51…and yesterday’s high of just 16194.72…with 16287.84, or 0.7% higher, but after grinding to reach that level it gave up 67of those hard-earned points and closed at 16221 + 42, on BIG volume of 4.97B shares AND REAL VOLUME SURGED to 1.97B shares – highest since 9/20’s huge 2.06B shares. Now look at the others: 6/28, end of Q2 1.75B; 6/21, options expiry 2.01B; 3/15, 1.83B, options expiry; 12/21/12, yep, you guessed it; 1.88B shares! What was the average over this period: 727M shares. Now you know! By the way same pattern existed in 2012 and 2011
Not much of a day, but what did you expect with the final options expiration of the year today??? This is not trivial as the high volume came same day in Q3!!! Don’t take any wooden nickels! Yesterday’s NYSE Volume was an average 3.49B shares vs 4.29B (set-up day for today’s expiry), while REAL NYSE Volume fell to a slightly below average 701M shares from 828M tied with the high of 8/26! Advance/Declines and Breadth were modestly negative. As for the indices, the title of ‘goat’ goes to BOTH Dow Utilities and the Russell 2000, small cap – strange bedfellows! Nothing to report on the rest as even the high-flying Dow Transports closed flat! Last item: the VIX: just one day below 14 then rallied back yesterday…to TB this means a down day today…but who knows?
The Nasdaq 100 gained 32.5 points vs -11 vs +40 vs -6.5 vs -19. Breadth was strong at +3.1x vs -2:1 vs +8:1 vs -1.1 vs +2.1. Nine members gained more than an index point, while none lost a point: MSFT +3.8 vs -2.4; GOOG +3.5; APPL +3.4 vs -3.4 vs -2 vs +2.5 vs -4.9; most of the rest were not frequent fliers: AMZN +2.9; FILD +1.5; EBAY +1.4; CELG +1.3; BIIB +1.1; SBUX +1.
Dow 30 +0.3% vs +0.1% vs +1.8%!!! vs -0.1% vs +0.8%; Dow Transports +1.1% vs flat vs +1.2% vs-0.4% vs +0.9%; Russell 2000 +0.9% vs -0.7% vs +1.3% vs -0.1% vs +0.6%; Dow Utilities +1% vs -0.7% vs +1.2% vs +0.1% vs +0.7%; S&P 500 +0.5% vs -0.1% vs +1.7% vs -0.3% vs +0.6%; Nasdaq Composite +1.2% vs -0.3% vs +1.2% vs -0.1% vs +0.6%; NDQ 100 +0.9% vs -0.3% vs +1.1% vs +0.7% vs -0.1%.
*NYSE Volume surged to a near record high (typical of options expiry) 4.97B shares from an average 3.49B vs 4.29B vs 3.25B vs 3.16B. The record high (?) is 4.97B shares on Q3 end of quarter while 11/29’s 1.59B is weakest of 2013). REAL NYSE Volume also rose sharply to 1.97B shares – highest since 9/20’s huge 2.06B shares. Now look at the others: 6/28, end of Q2 1.75B; 6/21, options expiry 2.01B; 3/15, 1.83B, options expiry; 12/21/12, yep, you guessed it; 1.88B shares! vs a below average 701M vs 828M vs 668M vs 681M. The 12-month average is 727M shares. This year there have been just TEN 1B+ share sessions! There have been 39 800M+ shares in 2013: 18 up, 19 down, three mixed.
*New 52 week highs have ranged from 33-864. They nearly doubled to a high 550 vs 304 vs 334 vs 164 vs 223 vs 83! Recent high is a super-strong 890!!! New lows were sharply lower at a weak 81 vs 127 vs 131 vs 135 vs 133 vs 353. Recent low is 35!
- Advance/Declines were positive: +3.1x vs -1.4x vs +3.6x! vs -1.1x vs +2x (recent range -17.5x to +6x) on NYSE and +2.6x vs -1.6x vs +2.5x vs -1.2x vs +2.1x (recent -4x!!! to +3.8x). Breadth was similar: +2.3x vs -1.14x vs +4x! vs -1.3x vs +2.4x (recent -18.6x!!! to +7.2x!!!) on NYSE and +4.6x vs -1.3x vs +3.1x vs .+1.1x vs +2.8x (recent -12.8x to +6.5x).
- NYSE Financials rose 0.5% vs +0.2% vs +2.1%! vs -0.5% vs +1.2%! BofA most active: -1%! vs +0.4% vs +0.4% vs +0.1% vs -0.5%, closing at $15.60 -.15 – it tanked going into the close!!! 11/25’s 12-month high was $15.98, highest since 6/1/10. Brokers +1.8% vs -0.6% vs +1.8% vs -0.3% vs +0.3%; KBW Banks +0.5% vs +0.1% vs +2.1% vs -0.8% vs +0.7%; Nasdaq Banks +1.3% vs -0.7% vs +1.4% vs -0.7% vs +1.4%.
- Volatility (S&P VIX) oscillated once again closing at 13.79 -.36 two days after plunging (options expiry related no doubt), and is back below 14! The range was a narrow 13.12 to 13.87 High for the week was 16.67! It is back between the 40/50 day m/a’s: 13.64/13.87, while the 200 day is 14.38. The recent range is 11.83-21.01!!! Since March 11th the average has been just 14.44…way below the five year average of 23.32. It peaked at 22.79 on 12/28/12…ytd the range is 11.05 (3/14) to 21.92 (6/24)!
Bonds rallied on the long end, and the 5-30 year flattened! 30 yr closed at 3.82-1-7/16 vs 3.91% while the 10 yr closed at 2.89% +3/8 vs 2.93% – NOTE CURVE FLATTENING!!! Long TIP closed 1.54% +1-1/2. Overnight the flattening continues: 10yr 2.90% -1/16 (recent range 1.63% to 2.99%), and the 30 yr 3.82% UP 1/8 (recent range 2.67% to 3.92%). The long TIP is 1.53% +1/4 The (record?) low of 0.36% was set on 4/5. NOTE recent high yield: 1.63%! Libor update: 0.246% 3 mos, 0.349% 6 mos. (both almost at record lows!). Foreign bond yields higher – again, ex-Greece: Germany 1.88% +1; UK 2.94% +1; France 2.48% +2; Italy 4.17% +5; Spain 4.20% +6; Portugal 5.96% -1; Greece 8.24% -11 vs -3 vs -11! Recently: 7.71% – 12.57%. Japan 0.67% –.
Gold rallied but closed just a hair above $1200 at $12.03.70 +$10.10 after putting in a low of $1188…at least still above Thursday’s $1186 – LOWEST since 12/31/02. Recent high is $1375.40 on 9/19. Now $1200, added to $1300, is psychological resistance with major res at the 40 day ($1268!) and the 50 day ($1276!). The 200 day is a $1364. Overnight it is back below 1200 at $1197.70 -$6.00, with a session low of $1191.80!
Crude closed slightly higher at $99.32 +.28 on an inside session. Last Wednesday’s low was $96.26, lowest since 12/3. On 11/27 it printed a new low of $91.77, lowest since 6/3!!! The record high of $114.83 was on 5/2/11, the low since on 10/4/11 is $74.95: $93.60 is the midpoint!!! Recent rally high and close are $110.70 and $110.53 respectively. It remains above the 40 day m/a ($95.65) and the 50 day (96.54), both dropping and remain major support! The 200 day is $98.82, and major sup/res! 4/18’s low of $85.61 was lowest since 12/11! The recent range is $85.61-$112.24 since March 1, 2012. Overnight it is lower at $99.01 -.31, low $98.86.
Global stocks higher, Japan closed/ UK +0.5% vs +0.3% vs +0.8% vs +0.3% vs -0.4%; France – vs +0.1% vs +1% vs +0.7% vs -1% vs +1.3%; Germany +0.6% vs +0.5% vs +1.1% vs +1.1% vs -0.4% vs +1.7%; Japan closed vs +0.1% vs +1.7% vs +2%! vs +0.8% vs -1.6%; Hang Seng +0.5% vs -0.3% vs -1.1%! vs +0.3% vs -0.2%; Korea +0.7% vs +0.4% vs +0.1% vs +0.5% vs +0.2%; India +0.1% vs +1.8% vs -0.7% vs +1.2% vs -0.2%. U.S. stock futures higher in a tight range after gapping up on the open? DOW +51 (range 26 points!); SPX +7.70 (7 points); NDQ +26 (15 points), lately, futures have been the tail of the dog…and they ain’t wagging it!!!
Some random thoughts:
Boy, were the Dutch STUPID!!! Buying tulips until the price went to the moon…we are much more advanced we invest in…BITCOINS!!! The brilliant invention of the two spoiled twins who came up with the idea of Facebook but didn’t have the ability to follow-thru yet collected millions. How can we be so stupid??? Nothing behind it, no one even knows who did the programming…it is coin of the realm for internet transactions…for crooks! What can go wrong?….go wrong…go wrong…
Last week’s column about Alan Simpson speaking at the Bush Library with Erskine Bowles caused this response after the friend who sent me the article”:
Saw the reply-still hard for me to justify. At some point principles have to exceed political expedience.
Principles have to be applied with economic realty. Fact: you do not try to balance a budget through severe austerity in a recession…especially one that not economic but caused by irresponsible actions by OUR industry! All to create more billionaires. That, Len, is fact.
To compound the problem, the failure to reach agreement which created sequestration did huge damage to people who were already victims.
Meanwhile, Romney got rich…do you have $100 million in your 401k? Thanks to the carried interest provision which the financial lobby keeps intact along with the asshole Grover Norquist who even sees removing a subsidy as a tax increase!!! Not kidding on this!
Also, the effective tax rate on the top 1% is 17%…Romney’s was 19%. Of course, he gave millions to the church.
This brings me to another issue that Robert Reich raised…fundraisers…like the Napa Valley Wine Auction or dozens in New York. These are social events that raise money but look at the expenses…the least effective way of giving. Or just like Carnegie and Mellon, and other robber barons. sure building public libraries is great but is that where the money is needed? These are monuments to themselves. Also wings for universities that only the rich can afford.
Healthcare: The privatization of hospitals drove prices higher…why? Because no one builds a wing in a for profit hospital. Another is the health insurers that have become for profit…in Minnesota only non-profits are allowed. But get this: United Healthcare’s headquarters is here – even though they can’t sell insurance in the state!
Then of course there is Pharma, which GOP Senator Billy Tausin (R-LA) wrote Dubya’s baby Medicare Part D which was passed and implemented and is the cause for Medicare problems…because the Pharma lobby wrote it for him, expressly banning Medicare from negotiating prescription drug prices…which is why Medicare pays 30% more for them then Medicaid! Oh, and Tausin…didn’t run again for health reasons…but he was well enough to become head of the Pharma lobby until 2009 and made $11 million that year. sorry, not made…he EARNED it!
Lastly, is defense which has the ability to lobby and bribe key officers and did you know that the military now spends more on contract workers than for all members of the armed forces? Yet, defense cuts are not on the table. Just built the USS Minnesota, a nuclear sub…we don’t need it… we didn’t need the last couple of aircraft carriers either. Cold war relics…like the cost over-run F-15 which is a bribe to every congressman as something is built in each state…my late brother-in-law flew and maintained Apache helicopters…they were wonderful, except at no time did all the systems work being built by different companies and then had to be linked. I met a Navy Captain at my ships reunion…he is assigned to a project to reshape the Navy. their conclusion: we need more smaller, EXPENDABLE, ships not big ones or more subs.
Until the GOP is willing to address tax increases and subsidies and the Dems address entitlements nothing is going to happen, including after this sham agreement
Oh, and taxes for the wealthiest need to be increased. Reich say on $1 million or more…and he wants 70%…back to the numbers of the 60’s…Ike set the top bracket at 70%. Me? I favor a 50% tax above $5 million…why? because a million is nothing anymore and we want and need upward mobility… Above even half a million the economy doesn’t benefit unless you think ‘trickle down’ works…and it is proven it doesn’t. look at the widening wealth gap. Once heard an intelligence gatherer who contacted with the CIA: number one way to tell when a country’s government is in danger…the gap between the top and bottom 10%. Now it should be the top 1% and the rest…they own over 90% of the wealth. I laughed at the Fed Report saying the household wealth was back to 2007 levels…THAT IS AN AVERAGE…and it is all at the top!
No, I am not a bleeding heart liberal, I am somewhere between a fiscal conservative (not fanatic like Ryan and Cantor), and a libertarian.
Now you know where I stand. If you don’t provide fairness…you won’t get fairness when the merde hits the fan.
Lastly, this…from a good friend. Read it but don’t skip to the bottom to find out who wrote it…very timely…with this piece and for the holidays…largesse, noblesse noblige!
Why buy gold when you can buy Bitcoins???
All the best and sorry for the rant!…if you are still reading…LOL