Friday, September 5, 2008

Government Bailout (or, The PPT Rides Again)

Just when the whole world thought everything was going to hell in a handbasket, the manipulative meddlers of the financial underworld changed the tune.

Friday morning at 8:30 am, the Labor Department reported that US Non-farm payrolls shrunk by another 84,000 jobs, and the unemployment rate shot up to 6.1%, a five year high.

The news stories keep using the word "unexpectedly" when referring to the data, as though nobody thought that the economy would lose jobs for the 8th straight month or that the unemployment rate was rising. It's amazing that the mainstream media still considers most of the reading and viewing public stupid.

News flash for the AP, Reuters and the networks. We're not all stupid and some of us refuse to be fooled by innuendo, polls, charts, propaganda and other nefarious methods of fascist propaganda. Go tell it to someone who doesn't know any better. Oh, right, you do... worldwide.

In any case, it was another setback for stocks, or so it would seem as all of the major indices dropped into negative territory as soon as the opening bell sounded at 9:30. By 11:00 am, the Dow, S&P and NASDAQ had all shed more than 1% in value. It was beginning to look like another in the continuing saga of the slumping US stock market.

Of course, what with the incredible rock star status achieved by vice presidential candidate Sarah Palin over the past few days at the RNC, the government gurus simply could not have that, so up went stocks, thanks to our friends at the President's Working Group on Financial Markets (aka, the PPT, Plunge Protection Team) and their proxies in the market: Goldman Sachs, Merrill Lynch, et. al.

By 1:00, all was well. The indices sporting just minor losses or gains, the stage was set to send every pinstriped suit-wearing, fundamentals-are-sound-speaking, broker and dealer on the street home happy as a lark.

By 2:40, all of the indices were into positive ground. The Dow, just before 3:00, was actually up 40 points. All that nonsense about lost jobs, a worsening housing condition and a profit warning from Nokia was put on the back burner. We've got a president to elect, and Wall Street want the McCain/Palin ticket, no doubt about it.

To get those two elected, the markets cannot sell off. They must maintain their positive posture and maybe even spark off a rally or two before November. Happy days... they're here again, folks.

At 3:10 pm: Dow 11,220.96 +32.73; NASDAQ 2,255.88 -3.16; S&P 500 1,242.31 +5.48; NYSE Composite 8,033.76 +25.51

It's rather disheartening and discouraging to those who believe in things like the constitution, rule of law, free market economics and honest elections to see such shenanigans continuing, but we, the American people, have been and will continue to be bought and sold by and for corporate interests, first, last and at every moment in between.

Unless we stand up and demand change.

For the day, losers beat out gainers, 3202-2977. New lows expanded their gap over new highs, to 479-47. That last figure is significant. The new lows have been growing by the day all week, while new highs are at extremmely depressed levels. Despite Friday's somewhat neutral headlline numbers, the internals are indicative of a market poised for further deteroration.

Volume continued at levels just slightly better than last week's anemic performance. The outright lack of trading interest is a collateral outcome of the credit crisis and does not seem to have any opportunity to abate.

Commodities continued to reinforce the defation argument. Oil lost another $1.66, to $106.23. Gold fell 40 cents, to $802.80, while silver lost 62 cents, closing at a multi-month low of $12.33.

NYSE Volume 1,199,665,000
NASDAQ Volume 2,263,084,000

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