15 Jun 2007

Posted at 13:35h in The Friday Brief by
Today’s buying strength brings stock indices close to their all-time highs. The S&P and Dow are pennies away while the NASDAQ has blow considerably past its seven year high. In all the indices dropped between 3 ½% and 4% starting on June 5th. On that day inflation fears rocketed long term interest rates to three-year highs. The good news today is that an important measure of consumer price inflation increased less than predicted. The index which excludes food and fuel rose only 0.1% last month following a 0.2% rise in April. The measure which includes gasoline was up .7% for the month. The good news so far is that rising energy prices have not been passed along by producers to consumers.

08 Jun 2007

Posted at 13:46h in The Friday Brief by
Sailing downwind can be very tricky; certainly not as easy as it looks. A slight shift in the wind can send the mainsail boom sweeping across the boat with terrific speed and force. An alert skipper or crewmember who sees the sail flatten abruptly yells the warning  jibe which means to duck or find yourself in the drink with a knot on your head.

01 Jun 2007

Posted at 14:14h in The Friday Brief by
Have they executed a perfect landing by slowing the economy just long enough to wring out inflation while keeping growth alive? After slowing steadily for the last four quarters, the economy is giving strong signs that it may be back on a growth track. Today’s report from the Labor Department shows that employers added 157,000 jobs in May. It demonstrates that employers are optimistic about their businesses and it makes consumers feel better about their own jobs. Another report showed that personal spending rose in April by .5% following a .4% increase in March. Corporate earnings from S&P 500 companies gained 11.6% in the first quarter, which is three times more than analysts' estimates at the start of the reporting season. As the data shows an economy resuming healthy growth, inflation remains tame.

25 May 2007

Posted at 14:31h in The Friday Brief by
Yesterday’s new home sales report surprised everyone as sales surged 16% in April, the biggest jump in 14 years. The news sent stocks surging higher with the Dow up 100 points before traders took a broader, dimmer view sending the Dow down 85 points, the S&P down 1% (short of its record yet again), and the NASDAQ down 1.5%. The S&P 500 and the Dow may end their seven-week gain streak with this week’s decline of 1% so far. The bond market has retreated for two weeks as yields have marched steadily higher.