Market Review: Ups and Downs
Yes, yes, yes, we all know the recession is over. Apparently, however, the good news wasn’t enough to keep investors buying Friday as the Dow dropped 12.74 points to 9907.26 and the Nasdaq followed its lead, dropping 22.79 to 1911.24.
And this despite positive economic news from a variety of quarters: a drop in the unemployment rate (Dept. of Labor), a rise in the level of business activity (Institute of Supply Management), and the highest level of consumer confidence in a year (University of Michigan). U of M’s consumer sentiment index hit 93.0 last month, up from a low of 81.8 last September.
But that clearly isn’t being reflected in the markets. C’mon, consumers, where’s your confidence?
Addison Wiggin, The Daily Reckoning
February 02, 2002
THIS WEEK in THE DAILY RECKONING
by Bill Bonner
02/01/02 OSAMA BIN SMOOT
"…Smoot & Hawley have long since shuffled off this mortal coil. But Osama bin Laden, Pat Buchanan, and George W. Bush are, we assume, still alive. Any one of them could do as much damage as Smoot and Hawleycombined…"
01/31/02 ANIMAL STORY
"…Are investors sheep? Certainly, for many investors, calling them dumb as sheep slanders the mutton. But on the whole, men, like sheep…tend to roam around haphazardly most of the time…and eventually go too far, needing a good jolt to bring them back where they belong…"
01/30/02 WHY GOLD IS SET TO SOAR
"…In the ’70s TV show ‘Barney Miller,’ a suspect is brought into the precinct after his wife reported a robbery. It turns out the robber was her husband. He confesses to his wife and Captain Miller that he liquidated everything he could and used the money to buy more gold. She looks at him with tired eyes. ‘Maybe you’re wrong, Harvey. Maybe we won’t get war, famine and runaway inflation.’ ‘Stop being such a damn pessimist!’ heyells…"
01/29/02 WAITING TO EXHALE
"…Alert readers will notice that there are a lot of moving parts in the machinery of modern markets. One part rarely turns without grinding against the teeth of another. If the price of IBM shares or split foyer houses in the suburbs go down, does not the dollar rise against them? And is not the dollar an asset whose price has also beeninflated?…"
01/28/02 CHEAP STOCKS…AND EXPENSIVE ONES
"…who actually turns the little screws and snaps together the plastic components to make laptops, routers, keyboards and switches? At first, they were assembled in garages by American entrepreneurs. But it didn’t take long before high tech industry discovered outsourcing – just as almost every other industry in America has. Today, much of the work of building IT devices is done by Hindus, Moslems, Buddhists or barely reconstructed communists. What does it mean, then, when the computers are madeoverseas?…"