When you have low volume, almost anything can happen in the stock market:
There is a very interesting chart at Hussman Funds which plots the various post-recession recoveries. Guess what? The action we've witnessed this year is quite the exception. Not only has the run-up been extraordinary, so has the volume. From the report:
It's clear that this year's rally is an extreme outlier in the dataset, with above-average returns and a continued contraction in volume from the levels of trading in March.
Calling it an "extreme outlier" is apt.
The report also notes the role played by "Phoenix stocks" like Fannie Mae, Freddie Mac, Citigroup, AIG, and Bank of America who are responsible for a lot of the (already low) trading action. Take those out and the volume is even lower, which makes you wonder what's going on in Wall Street.
What's going on in Wall Street? The public is not participating. It's strictly the pros playing/gaming the market with momentum as a huge factor. But momentum eventually runs dry, so expect some sort of reversal in the months ahead.
In a wide-ranging essay on Rupert Murdoch and his attempt to charge for content on the web, this excerpt:
Murdoch is not a modern marketer. He runs his business not on the basis of giving the consumer what he wants but through more old-fashioned methods of structural market domination. His world, and training ground, is the world of the newspaper war—a zero-sum game, where you wrestle market share from the other guy. Curiously, his newspaper battles have most often involved cutting prices rather than, as he now proposes to do on the Internet, raising them. (...)
But more than being about cost, his strategy is about pain. What he is always doing is demonstrating a level of strength and will and resolve against which the other guys, the weaker guys, cower. He can take more pain than anybody else.
That's not going to work against the Internet. There is no "other guy" to outlast, such as is found in a single metro area with a competing newspaper. (Also, with the Internet, Murdoch can't control distribution, his other strategy in media battles.)
Murdoch can't really believe that if he holds fast to charging for content, that he will undercut the (virtual) cross-town paper and ride to victory. Or maybe he does.
After months of semi-evading his role in having Betsy McCaughey published in the New Republic fifteen years ago, he writes a substantial post on the matter. On the whole, he admits to bad judgment but in the final lines asserts that the "No Exit" piece was only a part of the health care discussion and that Hillary Clinton is the real reason reform failed to get enacted.
Mentioned at Salon. An impressive agenda, but they will have to compete with the LOLCat Bible Translation Project. (The Internet has brought forth many wonderful things, but this is not one of them.)
The LOLCat Bible presents the books from only the Hebrew Bible, so Conservapedia's efforts will fill a much-needed void.
U.S. Economy: Service Industries Grow for First Time in a Year
Oct. 5 (Bloomberg) -- U.S. service industries expanded in September for the first time in a year as the emerging recovery spread from housing and factories to the broader economy.
Did you get that? The recovery, already firmly in place in housing and factories (!) is now spreading to other sectors of the economy. Who knew housing and manufacturing was doing so well?
To get out of the current crisis, “we need a source of demand, we need a driver,” he said, noting it has to come from business spending.
We need somebody to invent the equivalent of the railroad or Internet to get that happening again, he said.
His current views have been coloured by research showing that recessions triggered by financial crises persist longer, and the recovery depends heavily on the crisis-hit country scoring big export gains and large trade surpluses.
In an editorial, Wanted: Leadership on Jobs, the New York Times has virtually nothing to say about creating private sector jobs except for this:
If successful, ambitious goals like health care reform and energy legislation may generate jobs ...
Yet adds
... but officials have not persuasively linked them to job growth.
The Times notes:
Economic recovery will not automatically replace the jobs that have been lost so far in this recession. Nor will higher levels of learning and skill — necessary as they are — magically create jobs, especially in the numbers that are needed.
... the additional duties are unlikely to give [workers] lasting relief. In a globalized economy, raising tariffs cannot long protect uncompetitive businesses.
Hey, guess what? As long as we trade with a China that pays its workers very little in wages, all manufacturing jobs in the U.S. will be "uncompetitive", which is just fine for the Times, requiring no action at all (like tariffs).
Global free trade with countries that employ low-wage labor is a job killer in developed countries. The Times prefers not to notice that fact.
In that (latter cited) editorial, there was this gem:
Like all American workers, these workers can best be helped by regenerating growth at home and abroad. Protectionist remedies, even legal ones like this, impede that growth without providing long-term replacements for vulnerable, trade-threatened jobs.
Okay, New York Times, what are the long-term replacements for such jobs? What are they? Give us a list.
At the height of the financial panic last fall Goldman Sachs became a bank holding company, which enabled it to borrow directly from the Federal Reserve. It also became subject to supervision by the Federal Reserve Board (with the NY Fed on point) ...
Goldman is also currently engaged in private equity investments in nonfinancial firms around the world, as seen for example in its recent deal with Geely Automotive Holdings in China. U.S. banks or bank holding companies would not generally be allowed to undertake such transactions--in fact, it is annoyed bankers who have asked me to take this up.
Would someone from the NY Fed kindly explain the precise nature of the waiver that has been granted to Goldman so that it can operate in this fashion?
If this is temporary, is it envisaged that Goldman will cease being a bank holding company, or that it will divest itself shortly of activities not usually allowed (and with good reason) by banks? Or will all bank holding companies be allowed to expand on the same basis?
Goldman got a huge advantage with the waiver - they could borrow from the Fed at low rates - but it was supposed to be temporary, wasn't it?
In Roman Polanski case, is it Hollywood vs. Middle America?
Some of the industry's most prominent women said they believe Polanski, who faces a sentence as low as probation and as high as 16 months in prison for pleading guilty to having sex with a minor, should be freed. "My personal thoughts are let the guy go," said Peg Yorkin, founder of the Feminist Majority Foundation. "It's bad a person was raped. But that was so many years ago. The guy has been through so much in his life. It's crazy to arrest him now. Let it go. The government could spend its money on other things."
Press release from the Feminist Majority Foundation:
Statement of Eleanor Smeal President, Feminist Majority Foundation On the Arrest of Roman Polanski
The Feminist Majority Foundation joins our sister feminist organizations in working to ensure rape is prosecuted as the heinous crime that it is, especially against girls. The Feminist Majority Foundation is a leader in the fight to end all forms of violence against women and is demanding the expeditious processing of all back-logged rape kits in the possession of law enforcement authorities so that perpetrators can be brought to justice. The Feminist Majority Foundation believes Roman Polanski should be extradited to the United States to face the consequences of his conviction for raping a 13-year old girl in 1977. No one is above the law. The chair of our board, Peg Yorkin, was quoted in the Los Angeles Times yesterday providing her personal opinion on the matter of Polanski's arrest, but wants to make clear she condemns rape. Her statement on Polanski's arrest, however, does not reflect the position of the Feminist Majority Foundation.
The U.S. economic slump earlier this year was so severe it short-circuited the government’s model for calculating payrolls, raising the risk that today’s jobs report may be too optimistic.
About 824,000 more jobs may be subtracted from the payroll count for the 12 months through last March when the figures are officially revised early next year, a Labor Department report showed today. The revision would be the biggest since at least 1991. (...)
Because the government doesn’t know if a company fails to respond because it has gone out of business or is just late, it estimates the number of companies that may have folded. By the same token, it plugs in an estimate for the formation of new businesses to account for their hiring. (...)
“In this period of steep job losses, the birth/death model didn’t work as well as it usually does,” Manning said in an interview. “To the extent that there was an overstatement in the birth/death model, that is likely to still be there.”
The model added about 184,000 jobs to the payroll total last quarter compared with a 135,000 increase in the same period in 2008, before the financial crisis deepened with the collapse of Lehman Brothers Inc.
Some Palin backers cautioned against associating the politician with the views of her hired co-author.
[Conservative blogger Robert Stacy McCain, a co-author with Vincent] didn't respond to an email from POLITICO, but brushed off to the Washington Independent's any attempt to link Vincent to his own controversial past remarks on race.
That's it. By the way, the Washington Independent is not exactly CBS news. No printing presses, just a website.
The vast majority of the story was a neutral observation of Palin and her fans, e.g.:
Two other Vincent books reviewed Wednesday by POLITICO reveal a lively writing style and deep roots in evangelical Christianity.
What's notable isn't the Fox Nation lying. What's notable is Fox contining to create a division within the media. Fox viewers/readers are constantly being told not to believe other sources of information. That's what a cult does.
Will the teaching of evolution be a political issue in 2010?
With the Republicans fast becoming a party of Dixie christian militancy, seen most recently at that Take Back America confab, one has to wonder if Darwin and evolution won't appear as a factor in next year's elections. The reasons are:
Many are wary of scientific conclusions, global warming being the issue most focused on. A hostile stance towards science typically includes a rejection of evolution.
Lots of Republican leaders are one degree of separation from a prominent evolution denier. (Or zero degrees in the case of Huckabee.)
Evolution contradicts a literal reading of the bible.
Given that this country is polarized and likely to stay that way (or get worse), defining beliefs eventually rise to the surface as a proxy for each side. Will evolution be one of them? Perhaps so.
Obviously, the "main stream" media are hard of hearing and seeing. About 2 million mad-as-hell taxpayers assembling in Washington, D.C. for the largest-ever (most well-behaved ever, most respectful ever) protest did not make it onto their radar screens (or our TV screens). They need our help.
You've gotta love the "about 2 million" part.
That posting prompted this snarky comment (to get past the Fox Nation moderators:
This is a TEACHABLE MOMENT... NOW, please, in planning your events don't forget the TEA. That has always been your problem. You get everybody all excited, but then don't serve any tea, so we all get disappointed and go home. SO, learn from past mistakes and make sure there is plenty of yummy tea to be had by all. It also wouldn't hurt to have some tasty Kool-Aid available as well....maybe a couple of different flavors for variety. Kool-Aid is also a beloved drink, so you'll probably get a few people you otherwise might not. Oh, and maybe some nice pastries would be good too. Eclairs or creme horns, bismarks or even some good old fashioned donuts would be cool. So, c'mon people, let's do it Right ... this time....PLENTY OF TEA AND PASTRIES!
George Will has penned a number of skeptical-about-global-warming essays [A,B] which prompted Matthew Yglesias to pen spirited replies about Will and the Washington Post [A:1,2,3,4,5,6,7,8,9,10; B:1]
Scientists say the pattern of the last decade — after a precipitous rise in average global temperatures in the 1990s — is a result of cyclical variations in ocean conditions and has no bearing on the long-term warming effects of greenhouse gases building up in the atmosphere.
Shall we see Yglesias - over there busy in Europe - pick up on this latest Will column? Let's hope so. It's usually a good read.
In an editorial decrying the crackdown on 1,800 undocumented workers, which will lead to their being fired, the NYTimes argues that:
"one has to ask who benefits from a crackdown like this"
"The government has not charged [America Apparel] with knowingly hiring or exploiting illegal labor."
"Unlike companies that routinely seek out illegal immigrants ... American Apparel pays $10 to $12 an hour, well above the minimum wage and industry standards, plus health benefits."
"A crackdown that forces 1,800 taxpaying would-be Americans into joblessness in a dismal economy is a law-enforcement victory only in the bitterest, narrowest sense."
"As a solution to the problem of unauthorized workers — 1,800 down, millions to go — it’s ludicrous."
Is it that these "illegal immigrants" are all "taxpaying would-be Americans", and therefore should be exempt?
You've got to admire the "would-be" formulation. They didn't go for the more realistic "would-like-to-be".
Is it that crackdowns should only apply to companies that knowingly hire illegal labor, but not when the laborers themselves knowingly work in violation of the law?
Is it that illegal immigrants, when being paid fairly well, should be allowed to work in tht U.S.?
Is it that it's 'only' 1,800 jobs, and law enforcement shouldn't care about violations when the number is small?
The Times says, "The government has to enforce the law", but it appears in this case that they don't think it should so. The Times thinks that illegals working for a good wage (!) should be allowed to displace legal domestic labor. Taking that view, there might as well not be any laws regulating immigration or their ability to work in this country. Some people agree with that, but that view is very unpopular during a recession.
