Archive for 2014

• Morning News: May 30, 2014
  Eddy Elfenbein, May 30th, 2014 at 6:44 am

  Utilities Fall as European Shares Hold Near Six-Year Highs

  Realty Investors Flock to Spain

  BOJ Should Clarify Asset Buying Plan Beyond 2014: IMF

  U.S. Seeks $10 Billion Penalty From BNP Paribas For Evading Sanctions

  The VIX Mystery: Here’s What Investors Need to Know

  You Can Now Ask Google to Remove Links About You

  As Hachette Battles Amazon, A Small Publisher Defends Bezos

  Tyson Enters Bidding for Hillshire Brands With $6.1 Billion Offer

  Pending Home Sales Rise Below Forecast As Prices Lift

  Abercrombie Says It Sees the Light

  VW to Bring Models to U.S. More Quickly to Lure Consumers

  Virgin Galactic Signs Spaceflight Deal With U.S. Authority

  Southwest Airlines Hit With Second $200,000 Fine Over Fare Ads

  Roger Nusbaum: Get the Beta Right

  Credit Writedowns: Some Things to Consider if Spain Leaves the Euro

  Be sure to follow me on Twitter.

• Q1 GDP Falls 1%
  Eddy Elfenbein, May 29th, 2014 at 10:10 am

  The government reported that for the first time in three years, the economy contracted. Real GDP dropped by 1% for the first quarter of this year.

  Remember that the first quarter began five months ago and ended two months ago. Wall Street currently expects good numbers for Q2 and for the rest of this year.

• Morning News: May 29, 2014
  Eddy Elfenbein, May 29th, 2014 at 6:40 am

  World Stocks Lackluster Ahead of US Growth Update

  Shares Flirt With Record Highs on ECB Easing Bets

  Japan Retail Sales Fall at Record Pace After Tax Increase

  Spain Growth Accelerates as Household, Government Spending Rise

  Treasury Yields Dip to New 2014 Lows

  Oil Steady Ahead of U.S. Inventory Data

  Goldman Shuns Bonds Pimco’s Gross Favors in ‘New Neutral’

  iTunes Head Cue and Beat’s Iovine: Apple Will Put Beats on Steroids

  Costco Wholesale Third-Quarter Profit Rises 3%

  McDonald’s Plans Up to $20 Billion in Buybacks, Dividends

  ExtraHop Closes $41 Million in Series C Funding to Establish New Enterprise IT Category

  AMSURG Corp. to Acquire Sheridan Healthcare in Transformational Transaction Valued at $2.35 Billion

  Dish to Become Largest Company to Accept Bitcoin

  Bezos’ Bitter Book Battle With Hachette

  Joshua Brown: Brokers, Liquid Alts and the Fund That Never Goes Up

  Cullen Roche: The “Sharing Economy” Isn’t the Economy

  Be sure to follow me on Twitter.

• May 1970 – the Month the 1960s Boom Finally Ended
  Eddy Elfenbein, May 28th, 2014 at 2:36 pm

  From Gary Alexander at Navellier MarketMail:

  On April 30, 1970, President Nixon came on national television to explain why he was expanding the Vietnam War into Cambodia. That set off a firestorm of protest, including the closure or partial shutdown of classes in over 450 college campuses, climaxed by the death of four students at Kent State on May 4.

  The Dow collapsed on the Kent State killings – the greatest one-day drop in seven years, falling 2.6% to 714. In addition, May 4, 1970 was the day on which regular trading hours resumed on NYSE after a two-year experiment with shorter hours. From June to December 1968, the market closed each Wednesday. Then the market had limited hours (closing at 2:00 pm) in the first half of 1969 – all as part of an attempt to keep up with the huge volume of backroom work during the peak Go-Go years of the late 1960s.

  The next day, Tuesday, May 5, Arthur Burns’ Federal Reserve leaped into the breach by reducing credit requirements on stock purchases from 80% down to 65%, even while some of the most glamorous stocks were collapsing. (On Friday, May 8 in Geneva, Bernie Cornfeld was forced out of Investors Overseas Service (IOS), which fell to a penny a share by 1972. On May 17 in Dallas, James Ling quietly resigned as CEO of trendy conglomerate Ling-Temco-Vought, whose stock price had fallen from $170 to $16.)

  On Friday, May 22, a day on which the Dow hit a seven-year low, New York Stock Exchange President Bernard (“Bunny”) Lasker asked for and got an immediate audience with President Nixon, telling the President that the country was “five minutes till midnight of another 1929.” With no Memorial Day to stop the bleeding, the Dow dropped 20.81 points on Monday, May 25, the biggest one-day drop since the Kennedy assassination in 1963. With the Dow at 640, the reigning Dr. Doom, Elliot “Calamity” Janeway began talking about a Dow at 500 while John Kenneth Galbraith compared the current “insanity” to 1929.

  The next day, May 26, the Dow hit its absolute bottom of the bear market at 631, and President Nixon called a meeting of 60 or more leading financial and business leaders to the White House on May 27.

  That Wednesday meeting was “a cocktail hour of staggering economic importance,” according to John Brooks, since their appearance of action fueled a rally of historical proportions, a +5% 32-point Dow rally on May 27. For the three DAYS ending May 29, 1970, the Dow rose by an astounding 11%, even though the previous week, ending May 22, marked the fourth largest post-war weekly Dow drop to that date.

  The bear market was over – 1929 was avoided – but there was a massive amount of cleaning up to do in the second half of 1970. Ross Perot was called in to save F.I. du Pont & Co, the nation’s third-largest brokerage firm (behind Merrill Lynch and Bache). By December 1, 1970, according to John Brooks:

  “Wall Street hung by its fingertips. Roughly one hundred Stock Exchange firms had vanished over the past two years through merger or liquidation. Forty thousand customer accounts were involved in the 13 cases of liquidation, and most of them were still tied up, the customers, unable to get their cash or securities.”

  —The Go-Go Years, by John Brooks, page 342

• Morning News: May 28, 2014
  Eddy Elfenbein, May 28th, 2014 at 6:43 am

  German Jobless Rises Unexpectedly, Mild Winter Blamed

  Euro Falls a Second Day Versus Yen on German Unemployment

  India to Have Third-Largest Twitter Population by 2014

  FTC Calls For Curbs on Consumer Data Collection

  Consumer Confidence Advances to Second-Highest Since 2008

  UK Fraud Office Probes GSK After Claims of Foreign Bribery

  NASDAQ Nears 13-Year High as Technology Becomes Loved

  Pilgrim’s Pride Makes a $6.4 Billion Proposal to Buy Hillshire Brands

  Valeant Substantially Increases Merger Proposal For Allergan

  Alibaba Buys Stake in Singapore’s Postal Provider

  Amazon Acknowledges Contract Standoff With Hachette

  Twitter Turns Higher In Bid To Break Losing Streak

  Amazon Launches Collectible Coins Store

  Jeff Carter: The Pension Crisis and Startups

  Howard Lindzon: Stocks, Markets and Bankers Have No Memory or Shame…That’s YOUR Edge…and ‘Contain the Worrying’!

  Be sure to follow me on Twitter.

• The VIX Plunges and the S&P 500 Hits New High
  Eddy Elfenbein, May 27th, 2014 at 9:51 am

  We’re back! I hope everyone had a nice weekend. On Friday, the S&P 500 closed at an all-time high. We’re up again today into another all-time intra-day high. The S&P 500 is currently at 1,908. Once again, the small-caps are doing the best.

  The most surprising action is in volatility. On Friday, the VIX ($VIX) closed at 11.36, and we’re not far from making a seven-year low. On our Buy List, Moog ($MOG-A) is up to $73 per share, which is a new 52-week high. Oracle ($ORCL) is also in new high territory.

  This morning’s durable goods report showed an increase of 0.8% in April. Economists were expecting a decline of 0.7%. The figure for March was revised to +3.6%.

  

• Morning News: May 27, 2014
  Eddy Elfenbein, May 27th, 2014 at 7:10 am

  IMF’s Lagarde Says Bank Reforms Slowed by Fierce Industry Pushback

  Euro Zone’s Dijsselbloem Says Taxes on Labor Too High

  Euro Zone Inflation Seen Well Below 2% in 2014, 15: Ewald Nowotny

  Russian Gas Reliance in Europe Skewing Sanctions Debate

  China Said to Push Banks to Remove IBM Servers

  India Minister Jaitley Vows to Restore Investor Confidence

  Governments Await Obama’s Move on Carbon to Gauge U.S. Climate Efforts

  Big Insurance Rate Hikes in the Future?

  Lloyds Banking Group Launches TSB IPO

  Pfizer Abandons AstraZeneca Effort

  Accor Buys Back 97 Hotels for $1.23 Billion

  Foxconn to Buy Stake in Taiwanese Telecoms

  Shakeout Threatens Shale Patch as Frackers Go for Broke

  Joshua Brown: The First Task of the Day

  Roger Nusbaum: Financial Goals Must Be Sensible

  Be sure to follow me on Twitter.

• Morning News: May 26, 2014
  Eddy Elfenbein, May 26th, 2014 at 6:44 am

  IMF’s Lagarde Calls for Closer Cooperation Among Central Banks

  Europe Ready to Act Against Low Inflation, Says ECB’s Mario Draghi

  Poroshenko Wins Ukraine Vote With Russia Ready for Talks

  Five Areas Narendra Modi Should Focus on to Make India the Next China

  BOJ’s Iwata Says Will Adjust Policy if Economy Overheats

  Kakao Corp Agrees to Buy Daum to Spur Growth, Gain Seoul Listing

  Sales of New Single-Family Homes Jump 6.4% in April

  Exhibit A in G.E.’s Case for Alstom Deal

  Atos Offers $844 Million to Buy Bull in Cybersecurity Push

  Sony, Shanghai Oriental Pearl to set up China PlayStation JVs

  Buying Insurance Against Climate Change

  4 Ways To Reduce The Financial Bite Of Student Loan Interest Hikes

  Everything You Need to Know About Tim Geithner’s Defense of the Wall Street Bailout — in 3 Paragraphs

  Roger Nusbaum: You Are Wasting Your Time Trying to Keep Up with the Joneses

  Jeff Miller: Weighing the Week Ahead: Will a Sluggish Housing Sector Derail the Economy?

  Be sure to follow me on Twitter.

• No Newsletter Today
  Eddy Elfenbein, May 23rd, 2014 at 7:48 am

  Just a reminder that there’s no CWS Market Review today. We’ll be back next week with another exciting episode. Enjoy the long weekend!

• Morning News: May 23, 2014
  Eddy Elfenbein, May 23rd, 2014 at 6:30 am

  Putin’s Singapore Dream Costs Crimeans Their Banks and Burgers

  No Weaning Europe Off Russian Gas Says Gazprom

  Spain With Greece Win Higher Debt Ratings on Growth Outlook

  Modi to Use Courtship by World Leaders to Aid India’s Growth

  Unrest Spurs Honda’s Thai Unit to Cut Output, Delay New Plant

  Gain in Existing U.S. Home Sales Lifts Spring Prospects

  Biotech Rally Sends Market Higher

  Mixed Reactions After U.S. Drastically Cuts Monterey Shale Outlook

  Gap Reaffirms Outlook, Focuses on Expansion

  Best Buy Beats Earnings: Turnaround Sign or Short-Term Rebound?

  GameStop Is The Ultimate Bear Trap

  Hewlett Packard Faces The Classic Dilemma, How Do You Thrive In A Declining Market?

  Barclays Fined $44 Million for London Gold Fix Failings

  Cullen Roche: Three Signs the Economy is Doing Okay

  Jeff Miller: The Sound of Silence

  Be sure to follow me on Twitter.