The Morning Blog Needs Your Help
Posted by Eddy Elfenbein on October 12th, 2006 at 12:59 am

I always love how Liz Claman begins her Morning Blog entries with, “hey bloggers.” Isn’t that just adorable? It’s so perky!
I know. I know. As much as I adore Liz, she’s committed a slight faux pas. The aforementioned bloggers are in fact, us, the readers. She’s the blogger.
Ok, so Liz isn’t hip to our new fangled techno-lingo. Big deal, right?
Apparently, The Man has put an end to it:

Okay gang, Now I *really* need your help. I have been informed by THE POWERS THAT BE at CNBC.com that while they think TheMorningBlog is terrific and that you guys are terrific, they did want me to know (lower voice here:) that ‘people who read blogs, Liz, really *aren’t* called Bloggers, like you’ve been calling them.”
Oh yeah, I got the harsh word from CNBC.com Executive Producer Alex Crippen that *I’M* the blogger, not you guys. So when I write, “Hey Bloggers!” I’m totally uncool and wrong.
But then we both decided that there really isn’t an official word for people who READ Blogs, so I NEED YOUR HELP!! Do you have any ideas of what I should call you? Alex and I threw around “Blog-o-shperians”, “Blogees” or “Bleagers” (Blog + Reader? I know, lame.) But none of these sounds right. Submit Submit Submit!!! If we like one, we’ll start using it!
As always, Thank you, Blog-o-ponders. (Blog + Responder? I know. Totally LAME!)
xoxo
Liz (Ms. Blog)

My first effort was to combine Claman and Media, and I got Chlamydia. I don’t think that works.
Liz, let’s just call them “readers.”

Does the Bond Market Rule the Country?
Posted by Eddy Elfenbein on October 11th, 2006 at 10:52 pm

I’m a fan of predictions markets, although I think they’re mostly just for fun. There is, however, some evidence that one of the best political markets is the bond market—specifically—short-term interest rates.
The direction of short-term interest rates has had a fairly strong correlation with the political environment of the electorate. I should warn you that this is a soft relationship, and not to read too much into it. But as short-term interest rates rise, the country generally turns to the right. Conversely, when rates fall, the country shifts to the left. Generally,
It’s not that the Federal Reserve “pushes” the country in either direction, but instead, the electorate is reacting to the same things causing the Fed to act. Few things make a country more conservative than a bout of inflation (google Weimar and Germany for more details). The value of a country’s currency is one of those weird mystical bonds that connect a citizen to the state. When that gets ruptured, people don’t like it. It’s almost like a daily referendum on the legitamacy of the state.
Here’s a chart showing the change in short-term interest during the last five GOP-heavy election cycles. The elections were 1966, 1978, 1980 (a particularly crazy time), 1984 and 1994. In each of these elections, voters went to the polls facing higher short-term rates. I’ve also include the current cycle.

Here’s the GOP gain in the House in each of those cycles:
1966……………………47
1978……………………15
1980……………………34
1984……………………16
1994……………………54
James Carville once said that if he could be reincarnated, he’d want to come back as the bond market: “You can intimidate everybody.”

Bed Bath & Beyond Admits Backdating
Posted by Eddy Elfenbein on October 11th, 2006 at 9:09 am

Bed Bath & Beyond (BBBY) just completed a big internal probe and has found that the company practiced options backdating. The Wall Street Journal reports:

Bed Bath & Beyond said its internal probe examining the period from its 1992 initial public offering through May 2006 found that the company had misdated options on 44 occasions, 37 of them in favor of the recipients. In many cases, the probe concluded, executives used “hindsight” to select favorable grant dates in the past when the stock was trading at low points.

As a shareholder, I’m not happy with what BBBY has done, but I’m impressed with the way the company has handled this. Here’s the company’s report.
This should have no effect on the stock. The company said that it won’t restate historical results, but it will take an $8 million charge next quarter, which is about three cents a share.

Buy List Update
Posted by Eddy Elfenbein on October 10th, 2006 at 8:11 pm

Through today, the Buy List is up 7.18% compared with 8.42% for the S&P 500. The good news is that we’ve closed the gap over the last two months. Since August 9, we’re up 11.30% compared with 6.91% for the S&P 500.

Two Stocks I’m Watching
Posted by Eddy Elfenbein on October 10th, 2006 at 1:12 pm

One of things I enjoy about this blog is that it let’s me think out loud. Given that, here are two stocks that I’m keeping a close eye on right now. It doesn’t mean I’ll add them to the Buy List, but they look somewhat interesting at the moment.
The first is TrustCo Bank Corp. NY (TRST). This little bank is about as dull as they get. The share price has slooowwwlly drifted down from $13 to $11. This thing just doesn’t move much, and no one follows it. But TRST pays a nice dividend (hey, 16 cents a quarter is more than any T-bond will get you).
The other is Lincare (LNCR). Frankly, I’m undecided on this one. It’s a health care company that makes home oxygen equipment. The stock got slammed after Medicare cut back on its reimbursements. The stock is down, and it may be a great value. I’ll have to look at this more closely.

Google Buys YouTube
Posted by Eddy Elfenbein on October 10th, 2006 at 10:00 am

So the rumors were true:

The Google guys have swallowed YouTube for $1.65 billion. Marking its biggest deal ever, the Internet giant agreed to snap up the red hot site in a major push for video supremacy on the Internet.
“Google has taken the first step toward being more of a media company than a technology company,” said Joe Laszlo, senior analyst at Jupiter Research. “They bought the idea that social networking is big business – and they bought the leader.”
The Google-YouTube match-up marks another stunning story for an online start-up that didn’t even exist two years ago.
YouTube’s twenty-something founders, Chad Hurley and Steven Chen, started the company just 19 months ago, with the idea of giving regular folks a shot at uploading their own short videos onto the Web. In short order, YouTube became the Internet’s No. 1 video-sharing site.
The YouTube-ers and their 67-person staff – now overnight millionaires – will join Google but remain largely independent in Silicon Valley headquarters.

Sigh. Will the 90s ever end?

Phelps Wins Nobel Prize
Posted by Eddy Elfenbein on October 9th, 2006 at 11:09 am

Congratulations to Edmund Phelps, the winner of this year’s Nobel Prize in Economics:

The 73-year-old Columbia University professor’s work showed how low inflation today leads to expectations of low inflation in the future, thereby influencing future policy decision making by corporate and government leaders.
Phelps is the sixth American to win a Nobel this year, meaning that every prize except for the literature and peace awards, which are yet to be announced, have gone to Americans.

U.S.A! U.S.A!

Fifty Years Ago Today
Posted by Eddy Elfenbein on October 8th, 2006 at 9:59 pm

Twenty-seven batters up. Twenty-seven down.
Retrosheet has the details:

Read more…

Today’s Jobs Report
Posted by Eddy Elfenbein on October 6th, 2006 at 9:25 am

This morning, the government reported that the unemployment rate fell to 4.6% (or 4.578% to be exact), which is the lowest rate since before 9/11. But the economy only created 51,000 new jobs last month which is less than half what economists were expecting.
The economic environment continues to be defined as one with surging corporate profits and very meager job growth. Over the last three years, the economy has created an average of 160,000 new jobs a month, which is just barely above the rate of growth of the labor pool. Contrast this with the 1990s when the economy routinely created over 250,000 jobs a month.

Berkshire Hathaway Breaks $100,000
Posted by Eddy Elfenbein on October 5th, 2006 at 4:04 pm

The stock reached $100 a share on the first day of trading in 1977.