With interest rates at historic lows, individuals and funds which are primarily risk-averse or on fixed incomes need to carefully choose their preferred investment vehicles, because inflation is going to eat into most of what's earned in either dividend-producing or fixed-rate investments.
Nonetheless, there are options which can be investigated in search of the best interest rates on money market accounts, where the goal is not growth nor income, but, rather, preservation of capital against the ravages of inflation, which is running at an annual rate of three to six percent, depending upon the source and one's own individual lifestyle choices.
Among the more flexible choices for investors these days are money market accounts, which, unlike certificates of deposit or US Treasury bonds, doesn't tie up an investor's capital for months or years at a time. Modern money market accounts can be found within offerings from brokerage accounts, through banks, credit unions or other lending or financial institutions, and the benefits of holding one's money in one are myriad, from limited tax liability to some which offer checking accounts upon which one can draw out funds or even debit cards tied to the account, which makes certain money market accounts not only wise investments, but useful choices in today's fast-paced environment.
Due to regulations and requirements under Regulation Q, which defines and governs money market accounts, most institutions limit the amount of money one can withdraw in a given time frame (usually monthly) or the number of transactions one can make within a money market account without incurring fees or penalties. Thus it makes good sense to investigate some of the literally thousands of web sites which offer comparisons or informational links concerning personal investing in money market accounts. Since money market accounts are regulated under the auspices of the US Treasury, understanding the rules and tax implications is a good first step to learning which funds or accounts fit best with your individual situation.
Once a decision is made to open such an account, a search for the best interest rates on money market accounts should be the next undertaking, though it pays to read the fine print, because, like all investment or financial accounts, there are multiple choices that may or may not be beneficial to your particular goals.
At worst, money market accounts are useful tools for keeping the money you do have, especially if you're concerned about volatility or risk in other markets, such as stocks, bonds, or derivatives, the most risky of all investments. Most money markets are government guaranteed against default, so any funds committed to them are as safe, if not safer, than money in a bank.
Flexibility is key, so choose a money market account that meets your established needs, offers a fair interest rate without onerous restrictions, and you'll sleep well at night, knowing your money is in a sound and secure environment.
Friday, October 28, 2011
Thursday, October 27, 2011
Global Stocks in Love with European Rescue Plan
If yesterday's gains were the equivalent of irrational exuberance, then today's stock risings around the world must be something akin to unconditional love for all things European, Euro, Eurozone or Euro-centric.
In the pre-dawn hours of Thursday, the meeting of leaders from the 17 nations comprising the the Eurozone - the nations employing the Euro as official currency - within the 27-nation European Union, broke from their marathon meeting and outlined a bold, yet still unfinished plan to stave off the collapse of Greece, keep key European banks solvent and expand the European Financial Stability Facility (yes, we know, you were wondering what EFSF stood for) to Euro 1 trillion ($1.41 trillion).
Greek debt-issuers, denominated mostly by major European banks, would be required to write down bonds by 50% (a haircut, as it is known), a proposal that many of the prominent banks had wished to avoid - and still may fight - was pushed through by the Eurozone leaders as a necessary action to keep the government of Greece from default and insolvency. The total amount to be written down on Greek debt came roughly to Euro 100 billion ($141 billion), though analysts debated the actual figure, most arguing the the recapitalization of the banks must be a much higher number.
Despite the lack of clarity over the details of the plan, stock indices around the world exploded to the upside on the news. The Hang Seng gained 3.26%, with other markets in the region all positive, though it was the European bourses themselves which registered the largest gains by far.
In Germany, the DAX finished more than 5% higher, the French CAC-40 soared 6.28% and Austria's ATX surged 6.11%. Other european markets registered significant gains.
While the European markets were notching higher through their afternoon, US futures were indication an explosive open with Dow futures in the green to the tune of - at times - more than 300 points. When US markets opened, the response was quick and certain, with all of the major indices higher in the early going, the NASDAQ setting the pace all day and finishing with a phenomenal gain of nearly 88 points and the S&P outdoing it with a 3.43% hike by days' end.
That Europe's long-awaited plan will proceed without hitches is uncertain, though there are sure to be bumps along the road. For now, however, the global stock market reaction appears to be showing broad approval and unequivocal support.
Buoying the euphoric sentiment in the US was the initial reading of US 3rd quarter GDP, which came in as expected, showing a growth rate of 2.5%, when skeptics of the somewhat-dormant US recovery had predicted much lower numbers, some believing that America was heading back into recession. With the holiday season fast approaching, chances for a double-dip recession have by now been effectively squashed.
Not only were stocks radically higher, with the Dow piercing the 12,000 threshold for the first time since August 1, the index on pace for it's best October ever, but commodities were also up sharply across the board, with oil, gold, silver, corn, soybean and wheat futures all posting superlative gains.
At the end of the day, the markets put on a show of global confidence not seen in some time, registering some of the best gains since the 2008-09 US financial catastrophe. What remains to be seen is whether the European leaders can actually implement the plan and keep the global economy churning. For today, at least, the consensus seems to be primed for their best efforts.
Dow 12,208.55, +339.51 (2.86%)
NASDAQ 2,738.63, +87.96 (3.32%)
S&P 500 1,284.59, +42.59 (3.43%)
NYSE Composite 7,813.99, +307.84 (4.10%)
NASDAQ Volume 2,851,696,750
NYSE Volume 6,600,709,000
Combined NYSE & NASDAQ Advance - Decline: 4956-827
Combined NYSE & NASDAQ New highs - New lows: 282-31
WTI crude oil: 93.96, +3.76
Gold: 1,747.70, +24.20
Silver: 35.11, +1.80
In the pre-dawn hours of Thursday, the meeting of leaders from the 17 nations comprising the the Eurozone - the nations employing the Euro as official currency - within the 27-nation European Union, broke from their marathon meeting and outlined a bold, yet still unfinished plan to stave off the collapse of Greece, keep key European banks solvent and expand the European Financial Stability Facility (yes, we know, you were wondering what EFSF stood for) to Euro 1 trillion ($1.41 trillion).
Greek debt-issuers, denominated mostly by major European banks, would be required to write down bonds by 50% (a haircut, as it is known), a proposal that many of the prominent banks had wished to avoid - and still may fight - was pushed through by the Eurozone leaders as a necessary action to keep the government of Greece from default and insolvency. The total amount to be written down on Greek debt came roughly to Euro 100 billion ($141 billion), though analysts debated the actual figure, most arguing the the recapitalization of the banks must be a much higher number.
Despite the lack of clarity over the details of the plan, stock indices around the world exploded to the upside on the news. The Hang Seng gained 3.26%, with other markets in the region all positive, though it was the European bourses themselves which registered the largest gains by far.
In Germany, the DAX finished more than 5% higher, the French CAC-40 soared 6.28% and Austria's ATX surged 6.11%. Other european markets registered significant gains.
While the European markets were notching higher through their afternoon, US futures were indication an explosive open with Dow futures in the green to the tune of - at times - more than 300 points. When US markets opened, the response was quick and certain, with all of the major indices higher in the early going, the NASDAQ setting the pace all day and finishing with a phenomenal gain of nearly 88 points and the S&P outdoing it with a 3.43% hike by days' end.
That Europe's long-awaited plan will proceed without hitches is uncertain, though there are sure to be bumps along the road. For now, however, the global stock market reaction appears to be showing broad approval and unequivocal support.
Buoying the euphoric sentiment in the US was the initial reading of US 3rd quarter GDP, which came in as expected, showing a growth rate of 2.5%, when skeptics of the somewhat-dormant US recovery had predicted much lower numbers, some believing that America was heading back into recession. With the holiday season fast approaching, chances for a double-dip recession have by now been effectively squashed.
Not only were stocks radically higher, with the Dow piercing the 12,000 threshold for the first time since August 1, the index on pace for it's best October ever, but commodities were also up sharply across the board, with oil, gold, silver, corn, soybean and wheat futures all posting superlative gains.
At the end of the day, the markets put on a show of global confidence not seen in some time, registering some of the best gains since the 2008-09 US financial catastrophe. What remains to be seen is whether the European leaders can actually implement the plan and keep the global economy churning. For today, at least, the consensus seems to be primed for their best efforts.
Dow 12,208.55, +339.51 (2.86%)
NASDAQ 2,738.63, +87.96 (3.32%)
S&P 500 1,284.59, +42.59 (3.43%)
NYSE Composite 7,813.99, +307.84 (4.10%)
NASDAQ Volume 2,851,696,750
NYSE Volume 6,600,709,000
Combined NYSE & NASDAQ Advance - Decline: 4956-827
Combined NYSE & NASDAQ New highs - New lows: 282-31
WTI crude oil: 93.96, +3.76
Gold: 1,747.70, +24.20
Silver: 35.11, +1.80
Wednesday, October 26, 2011
Irrational Exuberance, Part II or Squared to the Power of X
Talk about irrational exuberance, the term applied to stock market speculation by the liar-crook-Fed Chairman Alan Greenspan back in the heady days of the internet revolution of 1996 (actually, December 5, 1996), when the "esteemed" Chairman uttered:
While Greenspan was a few years ahead of his time - the great dotcom bust occurred in 2000 - his warning to speculative investments was not well-heeded then, just as today, practically anybody not predicting unlimited growth potential and stocks soaring to new levels is routinely given short shrift by the establishment Wall Street press. But suppose someone were to look at the past three-and-a-half weeks (or, extrapolating out to the past three-and-a-half years)and say something to the effect:
Perhaps the imagined quotation is not quite as erudite or economically succinct as Greenspan's more famous lines, but the message is very clear, nonetheless and it is exactly how the Europeans plan to solve their various deep and myriad problems with finance. Most of the known world is so heavily indebted - spilt between governments, banks and businesses and individual households - that most should be barred from going further into debt. Fortunately for most Americans, this is exactly the case, as banks have not lent to anybody or anything besides the most creditworthy since the financial calamities of 2008. The mega-banks' own fears of their own imminent demise forced them into tighter lending standards after they realized (too late, though, since they are bankers, after all, they should have known better) that the trillions of dollars in mortgage loans made to people without adequate credit, jobs or income might just default and spread the contagion of massive debt default throughout the banking system.
Let's face it, they knew exactly what they were doing, peddling s&*t securities, disguised as top-shelf, AAA credit risk, by bundling together all of the garbage sub-prime, alt-A and payday loan-type mortgage junk into massive tranches of mortgage-backed securities and selling them to whomever came up with the cash. The bankers didn't really care that they would implode the system, knowing full well that their well-paid lackeys, aka bought-and-paid-for elected representatives of the US Congress and the Presidency would not allow them to fail. Besides, they had already absconded with billions of dollars in fees and other payments from the unsuspecting suckers they swindled.
Of course, this is now ancient history, as none of the bankers have gone to jail, nor even been investigated, much less tried for their egregious crimes. Instead we have the little show of insider trading by a couple of immigrants, Raj Rajaratnam (already indicted, tried and sentenced) and Rajat Gupta (indicted today on five counts of securities fraud and one count of conspiracy to commit securities fraud) to act as fall guys for the white, Wall Street elite.
Both are (were) rich, important and notably non-white and not natural-born American citizens. Rajaratnam was born in Sri Lanka and is of Tamil descent. Gupta was born in India. The message is clear. White guys who commit white collar crimes walk free. All others can, and likely will, be used as fall guys, protecting the brotherhood of the saintly banker elite. These guys may do jail time, but it won't be tough. Rajaratnam is already appealing his conviction and 11-year sentence, a process that could take years. Meanwhile, he's still free, at least until November 28. That's the date the judge set for him to surrender to authorities. Place your wagers on whether "Raj" flees the country or is admitted to a hospital. He suffers from multiple health issues, including diabetes.
It's pretty clear that these dark-skinned fellows are just actors in a well-scripted play that goeswell outside the bounds of traditional jurisprudence. Steal a car or a sell a dime bag of grass and justice will be meted out swiftly and surely. Steal billions of dollars and walk away.
So, expecting Wall Street to respond properly to the current European stupidity is just another example of the absurdity of economics, circa. 2011. Greece is already half-way to default, with Italy, Belgium and Spain close behind. Portugal and Ireland have lost their sovereignty to the international banking cartel, the citizens of those countries reduced to nothing more than indentured debt slaves. France teeters on the precipice of recession and the whole bunch will probably take down Germany - the only semi-stable country on the continent - with the lot.
All of that adds up to a buying frenzy of US stocks. If this isn't the most cockeyed, woeful example of irrational exuberance ever seen, I challenge anybody to make sense of it all. The contagion from the eventual failure of the Euro will spread like wildfire around the globe, affecting everything we buy, sell or touch. But until then, buy stocks, You can always sell them just before the next market crash.
Dow 11,869.04, +162.42 (1.39%)
NASDAQ 2,650.67, +12.25 (0.46%)
S&P 500 1,242.00, +12.95 (1.05%)
NYSE Composite 7,506.15, +105.33 (1.42%)
NASDAQ Volume 2,153,615,250
NYSE Volume 4,873,521,000
Combined NYSE & NASDAQ Advance - Decline: 4346-1278
Combined NYSE & NASDAQ New highs - New lows: 87-52
WTI crude oil: 90.92, -2.25
Gold: 1,723.50, +23.10
Silver: 33.31, +0.26
Clearly, sustained low inflation implies less uncertainty about the future, and lower risk premiums imply higher prices of stocks and other earning assets. We can see that in the inverse relationship exhibited by price/earnings ratios and the rate of inflation in the past. But how do we know when irrational exuberance has unduly escalated asset values, which then become subject to unexpected and prolonged contractions as they have in Japan over the past decade?
While Greenspan was a few years ahead of his time - the great dotcom bust occurred in 2000 - his warning to speculative investments was not well-heeded then, just as today, practically anybody not predicting unlimited growth potential and stocks soaring to new levels is routinely given short shrift by the establishment Wall Street press. But suppose someone were to look at the past three-and-a-half weeks (or, extrapolating out to the past three-and-a-half years)and say something to the effect:
Let me get this straight. The hopes of the US stock market are pinned to perpetual zero interest rates at home and hope that a collective of mostly bankrupt European nations will cobble together a lending facility designed to keep certain mostly Southern European governments from defaulting on their massive debts by bailing out banks and then borrowing even more hundreds of billions of euros from them. That sends stocks ten to twelve per cent higher over the course of the past three-and-a-half weeks and we haven't even seen details of the plan. I would call that either wishful thinking, a complete fake-out or irrational exuberance squared and to the power of X, X being the number of idiots who believe issuance of more debt will solve a problem that began because of excessive debt.
Perhaps the imagined quotation is not quite as erudite or economically succinct as Greenspan's more famous lines, but the message is very clear, nonetheless and it is exactly how the Europeans plan to solve their various deep and myriad problems with finance. Most of the known world is so heavily indebted - spilt between governments, banks and businesses and individual households - that most should be barred from going further into debt. Fortunately for most Americans, this is exactly the case, as banks have not lent to anybody or anything besides the most creditworthy since the financial calamities of 2008. The mega-banks' own fears of their own imminent demise forced them into tighter lending standards after they realized (too late, though, since they are bankers, after all, they should have known better) that the trillions of dollars in mortgage loans made to people without adequate credit, jobs or income might just default and spread the contagion of massive debt default throughout the banking system.
Let's face it, they knew exactly what they were doing, peddling s&*t securities, disguised as top-shelf, AAA credit risk, by bundling together all of the garbage sub-prime, alt-A and payday loan-type mortgage junk into massive tranches of mortgage-backed securities and selling them to whomever came up with the cash. The bankers didn't really care that they would implode the system, knowing full well that their well-paid lackeys, aka bought-and-paid-for elected representatives of the US Congress and the Presidency would not allow them to fail. Besides, they had already absconded with billions of dollars in fees and other payments from the unsuspecting suckers they swindled.
Of course, this is now ancient history, as none of the bankers have gone to jail, nor even been investigated, much less tried for their egregious crimes. Instead we have the little show of insider trading by a couple of immigrants, Raj Rajaratnam (already indicted, tried and sentenced) and Rajat Gupta (indicted today on five counts of securities fraud and one count of conspiracy to commit securities fraud) to act as fall guys for the white, Wall Street elite.
Both are (were) rich, important and notably non-white and not natural-born American citizens. Rajaratnam was born in Sri Lanka and is of Tamil descent. Gupta was born in India. The message is clear. White guys who commit white collar crimes walk free. All others can, and likely will, be used as fall guys, protecting the brotherhood of the saintly banker elite. These guys may do jail time, but it won't be tough. Rajaratnam is already appealing his conviction and 11-year sentence, a process that could take years. Meanwhile, he's still free, at least until November 28. That's the date the judge set for him to surrender to authorities. Place your wagers on whether "Raj" flees the country or is admitted to a hospital. He suffers from multiple health issues, including diabetes.
It's pretty clear that these dark-skinned fellows are just actors in a well-scripted play that goeswell outside the bounds of traditional jurisprudence. Steal a car or a sell a dime bag of grass and justice will be meted out swiftly and surely. Steal billions of dollars and walk away.
So, expecting Wall Street to respond properly to the current European stupidity is just another example of the absurdity of economics, circa. 2011. Greece is already half-way to default, with Italy, Belgium and Spain close behind. Portugal and Ireland have lost their sovereignty to the international banking cartel, the citizens of those countries reduced to nothing more than indentured debt slaves. France teeters on the precipice of recession and the whole bunch will probably take down Germany - the only semi-stable country on the continent - with the lot.
All of that adds up to a buying frenzy of US stocks. If this isn't the most cockeyed, woeful example of irrational exuberance ever seen, I challenge anybody to make sense of it all. The contagion from the eventual failure of the Euro will spread like wildfire around the globe, affecting everything we buy, sell or touch. But until then, buy stocks, You can always sell them just before the next market crash.
Dow 11,869.04, +162.42 (1.39%)
NASDAQ 2,650.67, +12.25 (0.46%)
S&P 500 1,242.00, +12.95 (1.05%)
NYSE Composite 7,506.15, +105.33 (1.42%)
NASDAQ Volume 2,153,615,250
NYSE Volume 4,873,521,000
Combined NYSE & NASDAQ Advance - Decline: 4346-1278
Combined NYSE & NASDAQ New highs - New lows: 87-52
WTI crude oil: 90.92, -2.25
Gold: 1,723.50, +23.10
Silver: 33.31, +0.26
Are Penny Stocks Key to the Investment Future?
It's well known that small businesses produce the bulk of new jobs in America, year in and year out, but that thesis may be more prescient in a "muddle through" or stagnant economy, such as the one that has prevailed the past three to five years. While the general stock market has seen significant gains since the '08-09 meltdown, smaller companies, despite lack of adequate access to capital for many, have been flourishing.
Most big, corporate stock advisors or brokers will tell you that small caps are the way to go if you're looking for growth, but only nimble advisors outside the mainstream with great research, like Timothy Sykes, can offer you the next top penny stock.
Penny stocks come in all manner of varieties, from small restaurant chain concepts to high-tech startups to the popular "green" companies which don't generally get the press or the credit for their risk-taking mindset. Finding these companies requires a lot of time and research, something the average home investor doesn't have and that's the exact reason why scouring the web for information on particular companies may not be the best approach.
In addition to some of these companies having little time nor money to spend on press releases and public relations, by the time big breakthroughs occur, it's often too late, the stock having already made a significant move.
That is why it's useful to follow Sykes and maybe a few other experts in the penny stock universe, as gains on some of these top picks have produced extraordinary gains in a relatively short period of time.
Small business is the driver of growth in America, and penny stocks are the instrument by which the average investor can keep pace or exceed the ultra-insiders of Wall Street. Think about it. Wouldn't it be better to be in on the ground floor of a little-known company with a load of upside, than a run-of-the-mill S&P 500 company whose every move is telegraphed over CNBC and more than likely previously dished out to the big brokerages? Why pin one's hopes on the big Wall Street-connected companies, many of which are responsible for the high unemployment and tight banking policies that have slowed US productivity to a crawl, when you can invest in some of the most exciting, albeit risky, ventures on the planet.
If you're looking for an edge and don't mind high risk, Timothy Sykes and his website are probably worth the time to investigate.
Most big, corporate stock advisors or brokers will tell you that small caps are the way to go if you're looking for growth, but only nimble advisors outside the mainstream with great research, like Timothy Sykes, can offer you the next top penny stock.
Penny stocks come in all manner of varieties, from small restaurant chain concepts to high-tech startups to the popular "green" companies which don't generally get the press or the credit for their risk-taking mindset. Finding these companies requires a lot of time and research, something the average home investor doesn't have and that's the exact reason why scouring the web for information on particular companies may not be the best approach.
In addition to some of these companies having little time nor money to spend on press releases and public relations, by the time big breakthroughs occur, it's often too late, the stock having already made a significant move.
That is why it's useful to follow Sykes and maybe a few other experts in the penny stock universe, as gains on some of these top picks have produced extraordinary gains in a relatively short period of time.
Small business is the driver of growth in America, and penny stocks are the instrument by which the average investor can keep pace or exceed the ultra-insiders of Wall Street. Think about it. Wouldn't it be better to be in on the ground floor of a little-known company with a load of upside, than a run-of-the-mill S&P 500 company whose every move is telegraphed over CNBC and more than likely previously dished out to the big brokerages? Why pin one's hopes on the big Wall Street-connected companies, many of which are responsible for the high unemployment and tight banking policies that have slowed US productivity to a crawl, when you can invest in some of the most exciting, albeit risky, ventures on the planet.
If you're looking for an edge and don't mind high risk, Timothy Sykes and his website are probably worth the time to investigate.
Tuesday, October 25, 2011
Euro Finance Ministers Meeting Cancelled; US Stocks Take a Dive
Anybody with half a brain and even a cursory understanding of Europe's debt crisis (or, circus) could have and should have seen this coming a mile away: the meeting of European finance ministers, scheduled for Wednesday, has been cancelled. While the general summit of Euro zone nation leaders will still occur, as planned, the finance minister meeting was supposed to issue some kind of document or plan outlining the strategy of saving Greece and other nations from defaulting.
The 27 member ecofin meeting was supposed to have dealt with the recapitalization of many of Europe's largest banks, most of which have been decimated by ongoing debt issues in Greece, Portugal and Ireland. While this particular piece of the Euro puzzle has temporarily been put on hold, the general summit of Eurozone leaders will combine the bank issues with two other important elements: how to deal with the losses incurred by banks which loaned to Greece (the bond "haircut") and how large (and leveraged) the bailout EFSF fund will be.
As has been the case in the recent past, US stocks took a major hit on news that Europe was still inching toward a comprehensive solution. Expert opinion now believes that the Euro situation will take months and probably years to be worked out; any proposed solutions will have to go through a rigorous process of scrutiny and ratification by member nations. In the meantime, Europe is sinking faster and faster into recession and citizens are rightfully angered over the inability of leaders to come to any kind of meaningful consensus on the various great problems.
If this seems like deja vu all over again, it's because the Europeans are master foot-draggers, routinely missing deadlines and making delays - for any manner of reasons - on important, pressing issues. This is just more of the same, and the game is getting very old, very quickly.
Here in the US, the S&P/Case-Shiller 20-city and 10-city composite readings for August came in below their year-ago levels by 3.8 percent and 3.5 percent, respectively, though both indices edged up slightly over July, posting a gain of 0.2%. In essence, what the Case-Shiller survey found was that while home prices are still falling, year-over-year, they are not falling as quickly, though that's of little comfort to the millions of homeowners whose homes are worth well less than what they paid for them, a condition known as being underwater.
At 10:00 am EDT, the Conference Board released its latest consumer confidence reading, finding that confidence was at a level not seen since the depths of the 2008-09 recession, at 39.8. Also, only 9.1% of respondents are expecting business conditions to improve over the next six months, a depressing figure considering that the US is supposed to be a good 12-18 months into recovery.
Stock traders sense that things are not going well, despite the markets in October having one of their best months of the year. Sooner or later the truth will set everyone free.
Dow 11,706.62 207.00 (1.74%)
NASDAQ 2,638.42 61.02 (2.26%)
S&P 500 1,229.05 25.14 (2.00%)
NYSE Compos 7,400.82 146.81 (1.95%)
NASDAQ Volume 1,810,687,875.00
NYSE Volume 4,406,436,500
Combined NYSE & NASDAQ Advance - Decline: 1024-4602
Combined NYSE & NASDAQ New highs - New lows: 67-35
WTI crude oil: 93.17, +1.90
Gold: 1,700.40, +48.10
Silver: 33.05, +1.41
The 27 member ecofin meeting was supposed to have dealt with the recapitalization of many of Europe's largest banks, most of which have been decimated by ongoing debt issues in Greece, Portugal and Ireland. While this particular piece of the Euro puzzle has temporarily been put on hold, the general summit of Eurozone leaders will combine the bank issues with two other important elements: how to deal with the losses incurred by banks which loaned to Greece (the bond "haircut") and how large (and leveraged) the bailout EFSF fund will be.
As has been the case in the recent past, US stocks took a major hit on news that Europe was still inching toward a comprehensive solution. Expert opinion now believes that the Euro situation will take months and probably years to be worked out; any proposed solutions will have to go through a rigorous process of scrutiny and ratification by member nations. In the meantime, Europe is sinking faster and faster into recession and citizens are rightfully angered over the inability of leaders to come to any kind of meaningful consensus on the various great problems.
If this seems like deja vu all over again, it's because the Europeans are master foot-draggers, routinely missing deadlines and making delays - for any manner of reasons - on important, pressing issues. This is just more of the same, and the game is getting very old, very quickly.
Here in the US, the S&P/Case-Shiller 20-city and 10-city composite readings for August came in below their year-ago levels by 3.8 percent and 3.5 percent, respectively, though both indices edged up slightly over July, posting a gain of 0.2%. In essence, what the Case-Shiller survey found was that while home prices are still falling, year-over-year, they are not falling as quickly, though that's of little comfort to the millions of homeowners whose homes are worth well less than what they paid for them, a condition known as being underwater.
At 10:00 am EDT, the Conference Board released its latest consumer confidence reading, finding that confidence was at a level not seen since the depths of the 2008-09 recession, at 39.8. Also, only 9.1% of respondents are expecting business conditions to improve over the next six months, a depressing figure considering that the US is supposed to be a good 12-18 months into recovery.
Stock traders sense that things are not going well, despite the markets in October having one of their best months of the year. Sooner or later the truth will set everyone free.
Dow 11,706.62 207.00 (1.74%)
NASDAQ 2,638.42 61.02 (2.26%)
S&P 500 1,229.05 25.14 (2.00%)
NYSE Compos 7,400.82 146.81 (1.95%)
NASDAQ Volume 1,810,687,875.00
NYSE Volume 4,406,436,500
Combined NYSE & NASDAQ Advance - Decline: 1024-4602
Combined NYSE & NASDAQ New highs - New lows: 67-35
WTI crude oil: 93.17, +1.90
Gold: 1,700.40, +48.10
Silver: 33.05, +1.41
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