The Daily Reckoning Weekend Edition

August 19-20, 2000

Ouzilly, France

By Addison Wiggin

MARKET REVIEW: Slow Week in the Summer of Love

What shall we say about the markets this week? So little
happened on Friday it seems almost comical to be reporting
the numbers: The Dow fell 9, the Nasdaq shrank 10 and the
S&P 500 slipped a piddly 4 to 1491. (ho, hum…)

The Dow ended the week 130 points lower than Mondays closed
but managed to keep its head above the 11,000 water mark…
11,046 to be exact. On Friday, falling shares outnumbered
climbers by a 4-to-3 on the NYSE. Volume – at 812 million
shares – was noticeably inferior to Thursday’s pace…
(yawn, stretch…)

Despite it’s 10 point loss a strong showing for big tech on
Thursday helped the Nasdaq finished the week up 81. (How
’bout them Orioles?)

All in all… Mr. Market seemed quite satisfied to see
these past days filed away in the dustbin of history as
another lazy week in the ‘summer of love.’ “Trading has
been extremely light this week as most companies have
completed issuing second-quarter earnings reports,” an
analyst in Reuter’s reports “and Investors await Tuesday’s
meeting of Fed policy-makers.” (I wonder what’s on the
tele?)

The Russell 2000 was down… 0.95 at 515…

Prices at the close of business Friday August 18th 2000:

Gold: $281.80, down $.90

Silver: $4.85, down $.028

Crude Oil: $31.99, up $.05

Natural Gas: $4.43, up $.03

CRB Index: 221.7, up .20

Dollar Index: 110.93, up .92

Yen: $.009, up un petit peu

Euro: hanging in there above $.90

British Pound: $1.49, down a penny

MARKET COMMENT and HOT PICK OF THE WEEK (all rolled into
one!): “The Great Northwest Blackout of 2001.”

Okay… now we’ve got some action.

Real Asset Investor’s Dan Ferris seems to have caught the
California electricity shortage just right. Dan’s been
keeping his eye on “unfolding opportunities,” in what he
calls “the worst energy crisis since the 70s.” Three of his
picks – Enron, EOG Resources, El Paso Energy – are up 104%,
112% and 54% respectively.

Ferris: ” The Wall Street Journal reported Friday the
‘Northwest feels shock waves from power deregulation’…
meaning the electricity shortage in California is
migrating.

Increasing demand is already causing as many problems in
Washington and Oregon as California. But the Northwest’s
peak season is not summer. It’s winter. A blackout is a one
in four possibility.

It’s clear to me, what happened in California during the
last month or so is the prelude to a suite of disasters –
or near disasters – that’ll play out over the next two –
three years all across the US.”

Dan Ferris,

Real Asset Investor
… far more entertaining than watching the indexes.

FLOTSAM AND JETSAM:

“The music business is a cruel and shallow money trench, a
long plastic hallway where thieves and pimps run free, and
good men die like dogs. There’s also a negative side.”

— Hunter S. Thompson

The same could be said of the financial business, no?