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Us Stocks-wall St Wilts As New Stimulus Talk Stokes Fears

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http://www.guardian.co.uk/business/feedarticle/8596109

U.S. stocks fell on Tuesday as talk of a second government stimulus plan stirred fears that the economy is far from well, raising the specter of an anemic second quarter earnings season.

A member of the Obama administration's economic advisory panel said the United States should plan to possibly provide a second round of stimulus funds to prop up the economy, implying that recovery is still far off.

"I think it's insane, the first stimulus package has not even been spent yet," said Andre Weisbrod, president & chief executive of Staar Financial Advisors in Pittsburgh.

"They are creating what I would call the government bubble ... When that bursts we are in huge trouble."

The recent rotation into non-cyclical areas of the market continued as investors sought out companies better positioned to weather a weak economy.

Healthcare, a classic defensive sector, was the only S&P 500 sector to avoid losses, rising 0.5 percent. Consumer staples, another defensive sector, had the smallest loss at 0.2 percent.

Drug maker Pfizer Inc rose 0.6 percent to $14.65, while food producer Kellogg Co rose 0.8 percent to $48.19.

But cyclical stocks in the materials, energy, and industrial sectors, which have ridden a recent upswing in raw material prices, lost ground as commodity prices eased as hopes dimmed of a quick recovery. Copper, a barometer of global economic strength, fell nearly 2 percent.

Caterpillar Inc, a maker of heavy machinery for construction and mining companies, shed 3.5 percent to $30.60.

A preview of the second-quarter performance of natural resource companies will come on Wednesday when Alcoa Inc kicks off quarterly earnings season. The aluminum producer, a Dow component, is expected to post a third consecutive quarterly loss.

Doubts about the strength of an economic recovery and subsequent demand for oil have sent crude prices tumbling in the last week. New York crude fell 1.5 percent on Tuesday and is down about 14 percent from the intraday peak hit on June 30. Its slide has pressured energy stocks.

Oil services company Schlumberger Ltd fell 2.8 percent to $50.01 while blue chip Exxon Mobil Corp lost 1.4 percent to $67.15. The S&P energy sector index lost 1.3 percent.

The Dow Jones industrial average dropped 67.26 points, or 0.81 percent, to 8,257.61. The Standard & Poor's 500 Index fell 6.44 points, or 0.72 percent, to 892.28. The Nasdaq Composite Index lost 18.73 points, or 1.05 percent, to 1,768.67.

Investor concerns over mounting debt were underscored by a report showing a record number of cash-strapped consumers falling behind on credit card bills in the first quarter.

Shares of credit card company American Express Co shed 1.9 percent at $23.07 and the S&P Consumer Finance index fell 2.7 percent.

A rally in the broad S&P 500 index that had boosted it about 40 percent from 12-year lows hit in early March has wilted in the last month as investors sought stronger evidence that economic conditions were improving.

Consumers can't pay there bills as they have no money and the US govt solution is to create even more debt with another stimulus package.

Genius.

I wish I could be an economic advisor, sorry what am I thinking my consciousness wouldn't allow me to spout this sort of crap.

It appears that the markets are realising good old uncle Sam is full of crap.

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"They are creating what I would call the government bubble ... When that bursts we are in huge trouble."

Absolutely true here as well. It makes me think this crisis hasn't even started yet.

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Absolutely true here as well. It makes me think this crisis hasn't even started yet.

+1

What we've had so far is just the starter. The main course is on its way..........

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+1

What we've had so far is just the starter. The main course is on its way..........

yep but more talk of the worst is over will be spouted

http://jsmineset.com/2009/07/06/mope-will-...iritual-levels/

MOPE Will Reach Spiritual Levels

Posted: Jul 06 2009 By: Jim Sinclair Post Edited: July 6, 2009 at 12:41 pm

Filed under: General Editorial

Dear Friends,

The hyperinflation we face has nothing to do with demand pull. It is a currency event as it has always been in every historic example going back to the Romans.

Hyperinflation has always occurred in the condition of the most vile economic activity. MOPE via its tool SPIN cannot and will not prevent what is 123 days away.

Anticipate MOPE (Management of Perspective Economics) to reach spiritual levels as the G8 plus 5 shovels out garbage to camouflage the discussions with the Plus 5 on dollar diversification via SSCI (Super Sovereign Currency Index) as a reserve currency unit.

This morning China is referred to by financial TV MOPE as not knowing what it wants. That is outrageous BS. China knows EXACTLY what they want and have defined it in a manner that is without question a Super Sovereign Reserve Currency package as part of available central bank reserves. There is no ambiguity at all concerning all the BRIC nation’s positions.

I will sum up the situation as 123 days to go.

I wager some of you have or will throw away your only insurance during this period at higher gold prices, trading later only to go into gold sticker shock.

Gold is headed to $1224 on its way to $1650 and Alf’s numbers.

The US dollar is going to have a very cold and uncomfortable winter.

Respectfully yours,

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looks like now that Goldman are down for an oil change, they'll have to Reopen the Shouting Pits

"SEVENTEEN TWENTY AT FOURTEEN! SIX AND A NINTH! CONSOLIDATED ZINC, TWO TWELVES FOR A BADGER! AND BUY YOUR OWN CHARLIE, YOU TREMENDOUS *******!"

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Why are stock market traders always surprised by this kind of thing? Are they the least economically-informed people on the planet?

Seems like it on a number of counts. In the good old days the city was full of east end barrow boys, no nonsense people who knew how to shout down phones. More recently it has become higher tech and legal based and the city is fully of vewy well educated Tim Nice But Dim types. They are living proof that anyone can be successful in a boom.

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Economies are bieng propped up by govt's on a huge scale, but it can only last so long! eventually they will have to flush the crapper after their huge stimulus sh1t or they will just stink the place up!

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DOW.jpg

Looks to me likw the DOW will soon be testing 8,000.

(Yet again.)

post-9120-1247006394_thumb.jpg

Edited by PotNoodle

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DOW.jpg

Looks to me likw the DOW will soon be testing 8,000.

(Yet again.)

Nice localised head and shoulders formation there.

Hold on tight guys, the ride's about to get really interesting :ph34r:

:lol:

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Nice localised head and shoulders formation there.

Hold on tight guys, the ride's about to get really interesting :ph34r:

:lol:

It feels like it. Seems like the June US unemployment figures sealed the deal.

I was reading about the US birth-death model the other day and it seems that it virtually drops out of the stats in Jan and July, so the July unemployment figures could be horrific in the US. :ph34r:

I think they added 185,000 jobs to the June figure using the birth-death model.

Edited by MOP

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It feels like it. Seems like the June US unemployment figures sealed the deal.

I was reading about the US birth-death model the other day and it seems that it virtually drops out of the stats in Jan and July, so the July unemployment figures could be horrific in the US. :ph34r:

I think they added 185,000 jobs to the June figure using the birth-death model.

Mish doesn't think so - although he doesn't say why.

At some point the BLS is going to have to get its hugely flawed model corrected and there will be a massive backward revision in jobs. I suspect this July is not that revision. However, I am looking for another bad month.

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Many highly placed people seemed to actually believe the green shoots mantra, until that jobs number came. Also earnings season is about to start in the US, so imo the market should be able to pick a direction and go with it.

I'm betting the direction is to continue the downwards movement of the last few weeks. I view a lot of the rally as a huge dead cat bounce after a historic meltdown.

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Many highly placed people seemed to actually believe the green shoots mantra, until that jobs number came. Also earnings season is about to start in the US, so imo the market should be able to pick a direction and go with it.

I'm betting the direction is to continue the downwards movement of the last few weeks. I view a lot of the rally as a huge dead cat bounce after a historic meltdown.

It's probably because they want to believe the lie. Happy clappy wins over the truth, if the truth is bad news.

If they told people the truth their popularity would crumble and someone else would come along with happy clappy mantras to make everyone feel better.

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http://business.timesonline.co.uk/tol/busi...icle6665638.ece

Asian stocks followed US markets sharply lower overnight after oil prices tumbled to $62, the lowest level since May, amid mounting concerns about the sluggish pace of the global economic recovery.

Japan's Nikkei fell to 2.4 per cent to a six week low while in Hong Kong, the Hang Seng plunged by 301 points, or 1.7 per cent, to 17,560.97.

The price of a barrel of London Brent crude fell 80 cents to $62.43 a barrel, extending a loss of nearly 15 per cent or $11 over the past six days since prices glanced a 2009 high of $73 last week.

Last night, the Dow Jones industrial average sunk by 161.27 points to 8,163.60 after the American Petroleum Institute (API) said that US gasoline stocks rose by 767,000 barrels against a predicted 600,000-barrel.

And Asian stocks followed.

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