• A Rise In Used Car Prices
    Posted by on March 8th, 2009 at 10:42 pm

    John Hempton eyes one tiny spec of good news in the Fed’s Beige Book:

    …the used car business is holding up surprisingly well. This was mentioned in the Federal Reserve’s Beige Book – but also in the Manheim index of used car prices at auction. This index spiked up last month!
    The biggest single determinant of losses in a subprime auto finance book is not loss rate – it is severity – the loss after the car is auctioned. I am not about to buy non distressed auto securitisations or anything – but if you want to play in the distressed stuff this is clearly good news.

    Hopefully, this is good news for companies like Nicholas Financial (NICK). That stock got knocked around hard last week. On successive days, the shares ranged from $1.80 to $2.71.

  • Satuday Night Live Takes a Look at the Banking Crisis
    Posted by on March 8th, 2009 at 10:37 pm

  • 43 Years Of No Real Gains
    Posted by on March 6th, 2009 at 12:57 pm

    Adjusting for inflation, the Dow is basically where it was in 1966.

    image782.png

    This doesn’t include dividends.

    From February 9, 1966 to yesterday’s close, the Dow gained 562.7%. The CPI from February 1966 to January 2009 (we’ll get February’s report on March 18) rose 559.8%.

    That works out to a real gain of 43 basis points stretched out over 43 years.

    Oh…and we’re down today.

  • Ouch!
    Posted by on March 6th, 2009 at 9:18 am

    image781.png
    This really says it all. The economy has lost about 2.5 million jobs over the last four months. The jobless rate is now 8.1% which is the highest in 25 years.

  • New 12-1/2 Year Low
    Posted by on March 5th, 2009 at 4:04 pm

    The S&P 500 reached 677.93 today which is the lowest intra-day level since September 13, 1996. For some perspective, that was the day that Tupac Shakur died.

  • Who Will Replace Citi in the Dow?
    Posted by on March 5th, 2009 at 3:36 pm

    I’m assuming Citigroup (C) won’t be in the Dow much longer. Here are 19 possible replacements:
    Abbott Laboratories (ABT)
    Altria (MO)
    Amgen (AMGN)
    Apple (AAPL)
    Bristol Myers Squibb (BMY)
    Cisco Systems (CSCO)
    Comcast (CMCSA)
    CVS Caremark (CVS)
    Genentech (DNA)
    Gilead Sciences (GILD)
    Goldman Sachs (GS)
    Google (GOOG)
    Monsanto (MON)
    Oracle (ORCL)
    PepsiCo (PEP)
    Qualcomm (QCOM)
    United Parcel Service (UPS)
    Wells Fargo (WFC)
    Wyeth (WYE)
    If they decide to go with another financial, I would think that Goldman would be the favorite.

  • Jon Stewart Vs. CNBC
    Posted by on March 5th, 2009 at 12:22 pm

    Everybody seems to be posting this video today. I’m sorry but this clip just doesn’t work for me. Jon Stewart is certainly funny, but I’m not a fan of taking soundbites out of context just to make your guests look foolish. Santelli is one of the best guys on CNBC and he’s been one of the most consistent people in cutting through the noise.
    Stewart, on the other hand, is the King of SWPL America. He takes quotes and events out of context, flips them around and presents them in such a way as to flatter his fans’ very large sense of self-superiority. In other words, Frank Rich loves him. But honestly, that gag is getting old. It’s also easy to do when you have a large crowd on your side. Let’s see Stewart go to pits in Chicago and try to embarrass them.
    I’ve seen lots of comments saying that Stewart destroyed or humiliated CNBC, or that this was the funniest, most brilliant thing they’ve ever seen. Hmm…that’s not what I see. Stewart has become exactly what he accused Crossfire of when he had his hissy fit there a few years ago.

  • Citigroup Is About to Break the Buck
    Posted by on March 5th, 2009 at 10:27 am

    The stock got down to as low as $1.02 today. Not too long ago, the company used to earn about that amount each quarter.

  • Cowboys Cut Terrell Owens
    Posted by on March 5th, 2009 at 7:57 am

    terrell_owens_pink_tuxedo.jpg
    The Dallas Cowboys have cut wide receiver Terrell Owens. I mention this because I believe I’m the first person to document TO-related events to the stock market:

    December 7, 1973: Owens born in Alabama. Dow rises 3% to 838.05.
    October 14, 2002: Sharpie Incident. Dow rises 27 points to 7,877.40.
    November 15, 2004: Desperate Housewives Incident. Dow rises 11 to 10,550.24.
    September 27, 2006: Owens denies suicide attempt. Dow rises 20 points to 34 points shy of an all-time high.

    I’m guessing being cut is a bullish event but I’m honestly not sure.

  • The True Measure of Inflation
    Posted by on March 4th, 2009 at 11:37 pm

    Mark J. Perry, a professor at Michigan, has a fascinating chart I’ve added below. It shows the truest measure of inflation—how much time it takes to buy certain items. By this measurement, most consumer goods are dramatically cheaper than they were 60 years ago.
    time030409.jpg
    I would add that this as dramatic as this chart is, it probably understates the case of deflation because it doesn’t adjust for the dramatic rise in quality.