Archive for 2006

  • Jim Stack: Recession Dead Ahead
    , June 7th, 2006 at 8:32 am

    I don’t always agree with Jim Stack, but he’s certainly someone worth listening to. Here’s his bearish outlook in the latest Forbes:

    Slowly and methodically, the forces have been moving us toward an imminent recession. These cyclical forces include commodity inflation, which on a long-term basis is at the highest level since the 1970s. But they also extend deeper– into the monetary forces and even consumer psychology behind the economic expansion.
    The yield curve has changed dramatically in the past 24 months, and is as “flat” as we can ever remember seeing it. The danger is the 88% historical probability of a recession that this represents. And if pressures preclude the Fed from easing later this year, one might say the odds of recession are closer to 100%.
    In the past 40 years, there have been eight instances where the yield curve (10-year T-bond minus 3-month T-bill) has flattened to this extent. In four of those instances, the yield curve temporarily widened, only to flatten again: 1973, 1989, 1998 and 2000. But in only one of those eight instances was the economy able to avoid a recession.

  • Tap Your Inner Blankfein
    , June 7th, 2006 at 8:20 am

    Are you interested in working for the Goldman Sachs? Well, of course you are!
    But you’re not sure where you fit in? No problemo…just take Goldman’s handy “Where do I fit in?” quiz.
    (Um…did anyone else get “shiftless blogger”?)
    :o(

  • Google and Its Principles
    , June 7th, 2006 at 7:32 am

    January 5, 2006: Crossing Wall Street

    One of the wonders of Google is the way they’ve been able to have Wall Street eat out of their hand at the same time the company slams the financial establishment. I’ve always felt that Google’s unconventionality was a bit affected. They seem to relish the role of outsider too much.
    And if you watch carefully, Google has backed down several times when important principles were at stake–principles which they claim they stand for. Never underestimate these moments.

    June 6, 2006: Brin Says Google Compromised Principles

    Google Inc. co-founder Sergey Brin acknowledged Tuesday the dominant Internet company has compromised its principles by accommodating Chinese censorship demands. He said Google is wrestling to make the deal work before deciding whether to reverse course.

  • Student Will ‘Fess to $cam
    , June 7th, 2006 at 7:04 am

    From (where else?) the NY Post:

    An NYU student who masqueraded as royalty to orchestrate multimillion-dollar check-kiting and hedge-fund scams in Connecticut is expected to cop to his crimes today, sources said.
    Hakan Yalincak, 22, faces up to 50 years in prison and fines of $1.125 million. He will plead guilty in New Haven federal court, prosecutors said yesterday.
    Yalincak’s decision came within days of a judge rejecting his bid to be released from jail before his trial.
    He is accused of trying to kite $43 million in phony checks, and of running a phony hedge fund that swindled investors out of $7 million.

    New York has the whole story in “Mommy’s Little Con Man.”

  • The Bull Market By Sectors
    , June 6th, 2006 at 2:06 pm

    Here’s a colorful chart. This is the relative strength of the 10 major industry sectors since the bull market began in March 2003:
    image066.png
    The defensive groups (staples and health care) have lagged. Also, tech hasn’t done that well in the last two-and-a-half years. Except for energy, I think it’s interesting how close together all the other sectors are.

  • Women lowering voices to raise salary
    , June 6th, 2006 at 1:51 pm

    From UPI:

    British researchers say career-driven women are lowering the pitch of their voices to get ahead in the workplace.
    The Daily Mail says a comparison of women’s voices between 1945 and 1993 reveals they deepened significantly in the second half of the century. During that time, the average pitch of women aged 18 to 25 lowered by 23 hertz — equivalent to a semi-tone drop.
    Anne Karpf, author of The Human Voice, says singing coaches and audio archivists have noted the deepening trend as high-powered female politicians and television correspondents are being encouraged to lower their pitch.
    Former Prime Minister Margaret Thatcher was advised by spin doctor Gordon Reece to swap her shrill tones for a deeper delivery, while voice coaching toned down Princess Diana’s soft, breathy speech, the newspaper said.

  • A 17th Rate Increase
    , June 6th, 2006 at 1:26 pm

    This is what yesterday was all about:
    fed funds.png
    After being on the fence, the July futures contract now believes that a 17th straight rate increase is very likely at the Fed meeting later this month.

  • Fibonacci on the Stock Market
    , June 6th, 2006 at 1:11 pm

    Over the weekend, I saw the Da Vinci Code. Since I’m the only person in the world left who hasn’t read the book, I felt a certain duty to see the film. The movie is OK, but a bit long. The plot revolves around several hidden messages buried in the works of Leonardo Da Vinci. Think “Paul is Dead” goes Gnostic.
    I noticed that Fibonacci numbers make a brief appearance in the film. If you’re not familiar with Fibonacci numbers, there are many people in modern finance who take them very seriously. There’s even an entire school of thought that believes that the stock market is a giant code and Fibonacci numbers are the decoding mechanism. I wish I were making this up.

    (more…)

  • Home Solutions of America Down 34%
    , June 6th, 2006 at 11:56 am

    Home Solutions of America (HOM) is crashing today. The cause is an alert from Stocklemon.com (I LOVE that name). Apparently, Home Solutions has been doing some naughty things:

    Just two short weeks ago, Home Solutions of America (AMEX:HOM) was hitting new highs. On the cusp of the new hurricane season, the market was searching for the next great “hurricane story” stock. That was the precise moment when insiders of HOM were selling their positions in large quantities.
    What do they know that you don’t know ?
    Is this really a hurricane play, or is it no more than a lot of hot air that hit an updraft of misunderstood news and hysteria? You will not believe what we found out.

    (more…)

  • More Volatility
    , June 5th, 2006 at 5:56 pm

    I keep having to update this statistic: Since May 11, the S&P 500 has had five daily falls of greater than 1.1%. In the six months before that, it had one. Today, the Dow Jones Oil & Gas Index (^DJUSEN) was down over 3%.