The Fed’s Data Dump
Posted by Eddy Elfenbein on December 2nd, 2010 at 10:17 am

I spent a good deal of yesterday browsing through the Federal Reserve’s massive data dump on the bailout. Frankly, it’s pretty boring stuff. Hatred and mistrust of the Fed is very high, so I’m not sure what some people were expecting the data to reveal; it’s largely what I assumed.

The media is full of dramatic headlines: “Fed made $9 trillion in emergency overnight loans.” This is another case of “accurate but misleading” reporting. Yes, the sum total of the overnight loans came to $9 trillion, but the Fed never had that much at stake at one time. That would be like taking the daily totals of your credit card or mortgage debt and adding them all up together.

The Fed’s Primary Dealer Credit Facility was created to keep the repo market going and thus prevent the banks from simply dumping their assets in a fire sale. This is what helped take Bear Stearns under. The Fed also relaxed its rules on what it allowed for collateral.

Morning News: December 2, 2010
Posted by Eddy Elfenbein on December 2nd, 2010 at 7:27 am

Stocks Poised to Keep on Rallying

Euro Holds Firm as All Eyes on Possible ECB Steps

Fed’s Crisis Aid Benefited Firms Beyond Wall Street

Job, Econ Growth Slowly Picking Up, Cheering Investors

Gold Firms Near Highs, Euro Debt Worries Persist

Fannie, Freddie Defend Foreclosures Amid Criticism

Spain Auctions EU2.5 Billion of Debt; Bonds Gain After Sale

Buy a Foreclosure – Save 30% on the Price

Toll Brothers Posts Profit on Tax Benefit

Starbucks Plans Acquisitions to Build Grocery Business

GM, Ford, Chrysler U.S. Sales Rise as Demand for SUVs, Pickup Trucks Gains

This Argument Is Dumb

The Fed Pays More Taxes Than Half the Country
Posted by Eddy Elfenbein on December 1st, 2010 at 8:15 pm

Here’s a stunning fact: the Federal Reserve pays more taxes than half the country pays.

In 2008, the Fed’s tax bill came to $31.7 billion.

That same year, according to the Tax Foundation, the bottom half of taxpayers paid a combined $27.9 billion to the U.S. Treasury. That’s 70 million tax returns.

The relationship probably grew wider last year. In 2009, the Fed paid the Treasury $45 billion.

We don’t know yet what the bottom half paid, but income taxes fell by 23% last year. It’s very possible that the Fed paid more than two-thirds of the country paid.

(Thanks to Alea for helping with this post.)

The S&P 500’s Real Total Return
Posted by Eddy Elfenbein on December 1st, 2010 at 3:59 pm

No major point to make here, I just thought I’d put up a chart of the real total performance of the S&P 500. This means it’s adjusted for dividends and inflation (or at least, the CPI):

In real terms, the market hasn’t made any money since March 1998.

Erin Burnett Interview at the NYSE
Posted by Eddy Elfenbein on December 1st, 2010 at 11:58 am

Alignment!
Posted by Eddy Elfenbein on December 1st, 2010 at 10:58 am

Way cool! The Dow and S&P 500 are nearly perfectly aligned at 11,200 and 1,200. That’s a spread of 10,000 points.

In other news, the moon is in the seventh house and Jupiter is aligned with Mars…

Here’s a look at the historic spread between the Dow and S&P 500. If I didn’t know better, it looks as if the market has been very aware of important barriers. Or is this just me trying to find a pattern in random data?

November ISM = 56.6
Posted by Eddy Elfenbein on December 1st, 2010 at 10:07 am

The ISM for November came out at 56.6 which beat Wall Street’s view by 0.1. The ISM has now been above 52.4 for 16 months in a row.

Two other items to pass along this morning: First, the dollar was the top-performing asset last month. The greenback beat stocks, bonds and commodities. This news will completely baffle the legions who have predicted the dollar’s imminent demise.

Second, Q3 productivity was revised higher to 2.3%.

Buy List Performance YTD
Posted by Eddy Elfenbein on December 1st, 2010 at 9:07 am

With 11 months now under our belt, let’s take a look at the Buy List‘s year-to-date performance.

Through yesterday, the 20 stocks on our Buy List are up 9.83% compared with 5.87% for the S&P 500.

Including dividends, we’re up 11.39% while the S&P 500 is up 7.86%.

If beta still means anything to you, ours is 0.9458.

JoS. A. Bank Earns 42 Cents Per Share
Posted by Eddy Elfenbein on December 1st, 2010 at 8:37 am

JoS. A. Bank Clothiers (JOSB) reported earnings today of 42 cents per share. Wall Street was expecting 50 cents per share and I was expecting even more.

While business is still going well for JOSB, this is a big disappointment:

JoS. A. Bank Clothiers, Inc. (Nasdaq Global Select Market: JOSB) announces that net income for the third quarter of fiscal year 2010 increased 7.1% to $12.6 million, as compared to $11.7 million for the third quarter of fiscal year 2009. Earnings per share for the third quarter of fiscal year 2010 increased 7.1% to $0.45 per share, as compared to $0.42 per share for the third quarter of fiscal year 2009. The third quarter of fiscal year 2010 ended October 30, 2010; the third quarter of fiscal year 2009 ended October 31, 2009.

Total sales for the third quarter of fiscal year 2010 increased 7.4% to $173.3 million from $161.3 million in the third quarter of fiscal year 2009, while comparable store sales increased 3.0% and Direct Marketing sales increased 14.9%.

Comparing the first nine months of fiscal year 2010 with the first nine months of fiscal year 2009, net income increased 25.6% to $44.9 million, as compared to $35.7 million and earnings per share increased 24.8% to $1.61 per share, as compared to $1.29 per share. Total sales for the first nine months of fiscal year 2010 increased 9.9% to $539.8 million from $491.0 million for the first nine months of fiscal year 2009, while comparable store sales increased 7.6% and Direct Marketing sales increased 8.4%.

“Sales for the quarter were positive but started out below plan in August and then picked up in September and October with each month getting progressively better, and then were even stronger in November and early December,” commented R. Neal Black, President and CEO of JoS. A. Bank Clothiers, Inc. “The hot weather in August was hard on us and it was tough to stage a big rebound after that due to the election; however, with these third quarter results, we have achieved record earnings growth in 36 of the past 37 quarters when compared to the respective prior year periods, including 18 quarters in a row. Right now, to date, the fourth quarter has started out strong. November suit sales and total sales were up substantially compared to last year and were ahead of our plans. Our fourth quarter results last year were very strong. Therefore we remain cautious, but our merchandising and marketing plans are in place for the most important selling period of the quarter and the year and we have confidence in those plans,” continued Mr. Black.

Morning News: December 1, 2010
Posted by Eddy Elfenbein on December 1st, 2010 at 7:30 am

Euro Gets Respite as Yield Spreads Tighten

U.K. Manufacturing Surges in November

Oil Rises After Biggest Drop in Two Weeks on U.S. Supply Outlook

Fed to Name Recipients of $3.3 Trillion in Aid During Crisis

Contagion May Force EU to Expand Arsenal to Fight Debt Crisis

Dollar Proves Best-Returning Asset in November, Defies Skeptics

Output Climbs Led by Asia, Despite Euro Crisis

Spain Banks Face Funding Hurdle Amid Bailout Threat

Google Gambit for Groupon Raises Concern

Motorola to Break into Two on January 4, 2011

Dude…That Internet Gold Rush Stole my Real Gold Rush