Stocks and investing thread

[southsider2k5]

I guess you don't have to be Fed President to see inflation coming...

 

http://www.forbes.com/markets/feeds/afx/20...afx4155570.html

 

Philadelphia Fed's Plosser says rate cut 'runs risk' of higher future inflation

09.25.07, 6:45 PM ET

 

WASHINGTON (Thomson Financial) - The Federal Reserve's rate cut last week 'runs the risk of higher inflation and expected inflation in the future,' Philadelphia Federal Reserve Bank President Charles Plosser warned today.

 

Despite that risk, Plosser said lowering the key federal funds rate target half a percentage point to 4.75 pct was 'appropriate.'

 

But, Plosser suggested one rate cut may be enough, telling the New Jersey Technology Council it would take economic reports that are 'much weaker' than he already expects for another 'downward revision in my outlook.'

 

In prepared remarks released to reporters in Washington, Plosser said it was an accumulation of data which led him to approve of the rate cut, though he doesn't actually vote on rate decisions this year.

 

First, he takes the reported 4,000-job decline in August employment 'with a grain of salt,' but the downward revisions in June and July employment suggested 'the labor market may not be quite as tight or as robust as we previously thought.'

 

Second, the housing recovery is likely to be delayed until later in 2008 than many forecasters had predicted.

 

Third, Plosser said, 'while there is little direct evidence that the financial disruptions have significantly affected the broader economy, that certainly is still a real possibility.'

 

And finally, inflation 'seemed to moderate' and inflation expectations were stable. While that did not and does not mean inflation is no longer a threat, Plosser thought 'it was encouraging.'

 

The important thing to remember is that the Fed's rate cut decision was made 'in anticipation of a slower economy in the coming few quarters,' Plosser said. He believes there is still a chance that 'growth will rebound more quickly.'

 

Borrowing the hawkish signal-phrase of the European Central Bank's head, the Philadelphia Fed chief said US monetary policymakers will have to 'remain vigilant' on inflation.

 

[email protected]

 

[Balta1701]

Link

Countrywide Financial Corp. Chairman and CEO Angelo Mozilo cashed in $138 million in stock options over the last year, switching his trading plans as the mortgage company went into a tailspin, it was reported Saturday.

 

Between November 2006 and August, Mozilo changed the plans outlining how many of his shares would be sold monthly, the Los Angeles Times reported.

 

Mozilo unloaded 4.9 million Countrywide shares, most of which he bought through exercising options.

 

Hundreds of executives use similar trading plans, approved by federal regulators in 2000 as a way to defend against insider trading allegations. While not illegal, it is highly unusual for the plans to be changed so often in a short period, experts said.

[kapkomet]

He disclosed it, and he followed the law. If people watched what was happening, they would have realized that Countrywide was a company that was in a little trouble.

 

[southsider2k5]

He disclosed it, and he followed the law. If people watched what was happening, they would have realized that Countrywide was a company that was in a little trouble.

 

That stuff is all public knowledge. There are places to go to find out what specific insiders are doing with their stock. It is a required disclosure to the SEC under Sarbines Oxley.

[southsider2k5]

Don't look now, but the Dow is points away from a another closing high... I will be shocked if it closes there, but stranger things have happened.

[Yossarian]

I guess you don't have to be Fed President to see inflation coming...

Overreaction to inflation by Paul Volcker, which was heavily endorsed by President Reagan pretty much destroyed the industrial north in the early 80s, and did much to put in place this unhealthy, horsehit two tiered ecnomy that we have now. I never understood the petrified horror our economic hochos have for inflation. This country has no history of hyper inflation like the Weimer Republic of Germany, but does have periodic depressions and severe recessions. I usually steer clear of money talk, since I have so little, but our policymakers have been screwing the middle class since the days of the oil embargo in the 70s.

[NUKE_CLEVELAND]

Don't look now, but the Dow is points away from a another closing high... I will be shocked if it closes there, but stranger things have happened.

 

 

It's very simple really. The stock market never met a rate cut it didn't like. The fact that it was 50 instead of 25 also was a cause for the big whoosh up lately.

[southsider2k5]

Overreaction to inflation by Paul Volcker, which was heavily endorsed by President Reagan pretty much destroyed the industrial north in the early 80s, and did much to put in place this unhealthy, horsehit two tiered ecnomy that we have now. I never understood the petrified horror our economic hochos have for inflation. This country has no history of hyper inflation like the Weimer Republic of Germany, but does have periodic depressions and severe recessions. I usually steer clear of money talk, since I have so little, but our policymakers have been screwing the middle class since the days of the oil embargo in the 70s.

 

It wasn't inflation that killed northern industry. It was superior foreign competition.

[Yossarian]

It wasn't inflation that killed northern industry. It was superior foreign competition.

Sorry, I will in no way accept that simplified explanation, although of course foreign competition played a role. As did fossilized thinking on the part of management and unions. This is chronicled well in John Hoerr's book about the demise of the steel industry, And the Wolf Finally Came. It doesn't change the fact that Fed policies undercut American industry at a time when it was most vulnerable. The country was going to change from heavy industry, but it didn't need to do it so suddenly and so violently. No, I'm not going to throw away a quarter century of my own personal research, and concede this major point with it was just "superior foreign competition." Besides, you have evidence of the carnage in your own back yard.

 

[NUKE_CLEVELAND]

Stock market is zooming higher today to start the quarter off. Dow is firmly in record territory now if it can close here.

[southsider2k5]

Sorry, I will in no way accept that simplified explanation, although of course foreign competition played a role. As did fossilized thinking on the part of management and unions. This is chronicled well in John Hoerr's book about the demise of the steel industry, And the Wolf Finally Came. It doesn't change the fact that Fed policies undercut American industry at a time when it was most vulnerable. The country was going to change from heavy industry, but it didn't need to do it so suddenly and so violently. No, I'm not going to throw away a quarter century of my own personal research, and concede this major point with it was just "superior foreign competition." Besides, you have evidence of the carnage in your own back yard.

 

I have plenty of evidence of the carnage in my backyard. I still see lots of the same trends in other industries as they are dragged kicking and screaming from the stone age, and it has nothing to do with inflationary rates. The auto and steel industries have been falling apart for decades, according to your hypothesis, this last 25 years of zero inflation should have done something for them, yet they have steadly gotten worse, not better. In fact inflation should have helped this, as it pushed the price of the dollar down, and the prices of these imports up, yet US industry couldn't keep up, even with a weakening dollar.

[Yossarian]

I have plenty of evidence of the carnage in my backyard. I still see lots of the same trends in other industries as they are dragged kicking and screaming from the stone age, and it has nothing to do with inflationary rates. The auto and steel industries have been falling apart for decades, according to your hypothesis, this last 25 years of zero inflation should have done something for them, yet they have steadly gotten worse, not better. In fact inflation should have helped this, as it pushed the price of the dollar down, and the prices of these imports up, yet US industry couldn't keep up, even with a weakening dollar.

Not enough bandwidth to continue. We're going to have to disagree I suppose. Actually, you make many good points, and American industry is far from blameless. I just see the period from 1973-1981 as crucial in American Economic History. I'm not alone (although in the minority) in my criticism of Paul Volcker and his predecessor Arthur Burns. Paul Craig Roberts and John Winthrop Wright were prominent critics of Volcker in the 80s. The Fed overreacted to inflation in the time period mentioned, and my part of the world suffered disproportionally. People, places, things not to mention whole industries often never fully recover from a trauma. Of all the major rust belt cities only Chicago is a semblance of its former self, and that's what it is, a semblance. Like I said, we're never going to agree on this, and I'd just as soon find something we do agree on, as I consider you a top notch internet poster. At least I won't get banned for disagreeing with you.

[NorthSideSox72]

Not enough bandwidth to continue. We're going to have to disagree I suppose. Actually, you make many good points, and American industry is far from blameless. I just see the period from 1973-1981 as crucial in American Economic History. I'm not alone (although in the minority) in my criticism of Paul Volcker and his predecessor Arthur Burns. Paul Craig Roberts and John Winthrop Wright were prominent critics of Volcker in the 80s. The Fed overreacted to inflation in the time period mentioned, and my part of the world suffered disproportionally. People, places, things not to mention whole industries often never fully recover from a trauma. Of all the major rust belt cities only Chicago is a semblance of its former self, and that's what it is, a semblance. Like I said, we're never going to agree on this, and I'd just as soon find something we do agree on, as I consider you a top notch internet poster. At least I won't get banned for disagreeing with you.

Chicago has undergone a renaissance, beginning in the 80's, that has propelled it from being a run-of-the-mill midwestern industrial center to a world class city. It now consistently wins accolades globally for being one of the great cities to live, work and play in. To say it is a semblance of it former 1973 self is, quite honestly, the opposite of the demostrable truth.

 

[southsider2k5]

Not enough bandwidth to continue. We're going to have to disagree I suppose. Actually, you make many good points, and American industry is far from blameless. I just see the period from 1973-1981 as crucial in American Economic History. I'm not alone (although in the minority) in my criticism of Paul Volcker and his predecessor Arthur Burns. Paul Craig Roberts and John Winthrop Wright were prominent critics of Volcker in the 80s. The Fed overreacted to inflation in the time period mentioned, and my part of the world suffered disproportionally. People, places, things not to mention whole industries often never fully recover from a trauma. Of all the major rust belt cities only Chicago is a semblance of its former self, and that's what it is, a semblance. Like I said, we're never going to agree on this, and I'd just as soon find something we do agree on, as I consider you a top notch internet poster. At least I won't get banned for disagreeing with you.

 

Ah, its cool. You obviously are well read on this. I have no problems with that. I guess my interpretation of history is a little different, that's all.

[Yossarian]

Chicago has undergone a renaissance, beginning in the 80's, that has propelled it from being a run-of-the-mill midwestern industrial center to a world class city. It now consistently wins accolades globally for being one of the great cities to live, work and play in. To say it is a semblance of it former 1973 self is, quite honestly, the opposite of the demostrable truth.

Oh boy, I just keep taking my lumps in this thread. There is no way any of the major cities in the US can compare with their zenith, which in my view was from the 20s to the 50s. Not Chicago, not New York, not any of them. Suburbia drastically changed the whole landscape. When the US had a total population of 120 million, and 7 or 8 million of them lived in NYC and another 3 million or so lived in Chicago, that was real power. I'll take the Chicago of my childhood (50s and 60s) hands down over the gentrified, yuppified city of today. To be sure, some things are better than ever. The lakefront, the skyline just absolutely takes your breath away. It's far more spectacular than it was in my youth. The museums are more numerous, and the older established ones are bigger and better than ever. In my youth Navy Pier was a dump, and in the 50s the area just due west of the northern part of the Magnificent Mile was dicey. There was no jazz festival, no blues festival, no Taste of Chicago. In many respects, the city is better than ever. In others, hell no. There was no jazz or blues festival, but there was a plethora of real jazz and blues clubs all over the city. Many of them in black communities, and they catered to a mixed clientele. You know, kind of like Bill O'Reilly and his visit to Sylvia's, only the whites who patronized these establishments didn't express astonishment at the ambience and class they were experiencing. I'm digressing, and I've only begun. One such place was the Pershing Lounge in Bronzeville, where a Ahmad Jamal and his Trio recorded a Jazz classic in front of a live audience in January of 1958. There was the grandeur of the Edgewater Beach Hotel, and many classic movie theatres too numerous to mention. There was the funkiness of the restaurant at Sieben's Brewery, Riverview, and a thousand other lost places. But most of all there were neighborhoods. Real neighborhoods with real working people striving for a piece of the American dream. The Germans on North Lincoln Ave, from North avenue all the way up to Foster. The Poles of Milwaukee avenue, centered at Milwaukee and Division. I remember the neatest Italian neighborhood on Chicago Aveune between Kedzie and Pulaski. In 1953, when we first moved to Chicago we rented a nice two bedroom apartment in a neighborhood that was really better than our status for $100 a month. When we left 8 years later it was still $100 a month, factored for inflation about 700-750 in today's dollars. The so called renaissance of the American city is being propped up by young professionals, empty nesters, gays, and to a degree recent foreign immigrants. Mommy and Daddy middle class and the kids started leaving in droves in the fifties. They haven't stopped. Today's Chicago is two tiered, the middle class is pretty much in the suburbs that almost stretch to Iowa now. The population of the city of Chicago is more than 20% off its 1950 peak, and after a brief resurgence in the 90s, is dropping again. The white population, more than 3 million in 1940 and 1950, is now below 900 thousand. I'll probably catch hell for mentioning that, but whatever. Yeah, the Loop, skyline, Lakefront are better than ever. The city and metro area as a whole, hell no. To get a better idea of what I'm talking about read Lost Chicago by David Garrard Lowe, The Lost City: The Forgotten Virtues of Community in America by Alan Ehrenhalt, or a great Chicago guidebook from a long ago era, Chicago an Extraordinary Guide by Jory Graham. The Beautiful Bronx 1920-1950 by Lloyd Ultan, isn't about Chicago of course, but it captures the vibe and energy of those times. Another New York centered book, The Shook up Generation by legendary New York Times reporter Harrison E Salibury, published in 1959 is a classic. You can see how our great American cities were started to fray at the edges in the 50s. I could give more real life or literary examples, but anyone who's read this so far probably has glazed eyes at this point. Edited October 2, 2007 by Yossarian

[NorthSideSox72]

Oh boy, I just keep taking my lumps in this thread. There is no way any of the major cities in the US can compare with their zenith, which in my view was from the 20s to the 50s. Not Chicago, not New York, not any of them. Suburbia drastically changed the whole landscape. When the US had a total population of 120 million, and 7 or 8 million of them lived in NYC and another 3 million or so lived in Chicago, that was real power. I'll take the Chicago of my childhood (50s and 60s) hands down over the gentrified, yuppified city of today. To be sure, some things are better than ever. The lakefront, the skyline just absolutely takes your breath away. It's far more spectacular than it was in my youth. The museums are more numerous, and the older established ones are bigger and better than ever. In my youth Navy Pier was a dump, and in the 50s the area just due west of the northern part of the Magnificent Mile was dicey. There was no jazz festival, no blues festival, no Taste of Chicago. In many respects, the city is better than ever. In others, hell no. There was no jazz or blues festival, but there was a plethora of real jazz and blues clubs all over the city. Many of them in black communities, and they catered to a mixed clientele. You know, kind of like Bill O'Reilly and his visit to Sylvia's, only the whites who patronized these establishments didn't express astonishment at the ambience and class they were experiencing. I'm digressing, and I've only begun. One such place was the Pershing Lounge in Bronzeville, where a Ahmad Jamal and his Trio recorded a Jazz classic in front of a live audience in January of 1958. There was the grandeur of the Edgewater Beach Hotel, and many classic movie theatres too numerous to mention. There was the funkiness of the restaurant at Sieben's Brewery, Riverview, and a thousand other lost places. But most of all there were neighborhoods. Real neighborhoods with real working people striving for a piece of the American dream. The Germans on North Lincoln Ave, from North avenue all the way up to Foster. The Poles of Milwaukee avenue, centered at Milwaukee and Division. I remember the neatest Italian neighborhood on Chicago Aveune between Kedzie and Pulaski. In 1953, when we first moved to Chicago we rented a nice two bedroom apartment in a neighborhood that was really better than our status for $100 a month. When we left 8 years later it was still $100 a month, factored for inflation about 700-750 in today's dollars. The so called renaissance of the American city is being propped up by young professionals, empty nesters, gays, and to a degree recent foreign immigrants. Mommy and Daddy middle class and the kids started leaving in droves in the fifties. They haven't stopped. Today's Chicago is two tiered, the middle class is pretty much in the suburbs that almost stretch to Iowa now. The population of the city of Chicago is more than 20% off its 1950 peak, and after a brief resurgence in the 90s, is dropping again. The white population, more than 3 million in 1940 and 1950, is now below 900 thousand. I'll probably catch hell for mentioning that, but whatever. Yeah, the Loop, skyline, Lakefront are better than ever. The city and metro area as a whole, hell no. To get a better idea of what I'm talking about read Lost Chicago by David Garrard Lowe, The Lost City: The Forgotten Virtues of Community in America by Alan Ehrenhalt, or a great Chicago guidebook from a long ago era, Chicago an Extraordinary Guide by Jory Graham. The Beautiful Bronx 1920-1950 by Lloyd Ultan, isn't about Chicago of course, but it captures the vibe and energy of those times. Another New York centered book, The Shook up Generation by legendary New York Times reporter Harrison E Salibury, published in 1959 is a classic. You can see how our great American cities were started to fray at the edges in the 50s. I could give more real life or literary examples, but anyone who's read this so far probably has glazed eyes at this point.

As a follow-up, check out this in the Trib. A solid study, using a lot of hard numbers, showing just how dramatically Chicago recovered in the 80's and 90's.

 

[BigSqwert]

Not sure where else to put this.

 

Topps Meat Co shuts down after beef recall.

[NorthSideSox72]

Oil hits $88/barrel. Gas at the pump still on the lower side of its $2.50-$3.50 band that its been in for a few years, but that will change soon. I've now heard multiple forecasts of $4 next year.

 

That hybrid is really starting to look appealing next year.

 

[StrangeSox]

Gas is continuing to drop (2.75 at the Thornton's in Elk Grove Village next to O'hare this morning) while oil futures continue to swell.

 

How long could the market sustain $80+/barrel and $4/gallon gas?

[NorthSideSox72]

Gas is continuing to drop (2.75 at the Thornton's in Elk Grove Village next to O'hare this morning) while oil futures continue to swell.

 

How long could the market sustain $80+/barrel and $4/gallon gas?

The more important question right now is, how long can it sustain $80/bbl+ oil and $2.75/gal gas? The answer is, a very short time. It will be over $3 again at the pump in a few days or weeks.

 

[StrangeSox]

BTW, a google search turns up a ton of article from May of this year or earlier that predicted $4 in the immediate future. I'm not holding my breath for $4/gallon, but I am glad that I carpool to work.

 

http://www.google.com/search?hl=en&q=g...244+this+summer

[NorthSideSox72]

BTW, a google search turns up a ton of article from May of this year or earlier that predicted $4 in the immediate future. I'm not holding my breath for $4/gallon, but I am glad that I carpool to work.

 

http://www.google.com/search?hl=en&q=g...244+this+summer

Yeah, there are always the panic folks. People said it a few years ago - $4 gas. But here is the thing - the fundamentals keep pushing higher, the price levels keep staying at higher levels for oil, and the people saying $4 now aren't the extremists but the mainline analysts... eventually, its happening. I'm guessing next summer.

 

[NorthSideSox72]

Dow down 367 points on combined fears about oil prices, credit/housing, a weak dollar and assorted other economic maladies.

 

[Balta1701]

Oil hit the $90 a barrel mark today.

[NorthSideSox72]

So, oil hit a significant mark at the end of trading yesterday - $93.53. Why is it significant? Its the highest level... ever. Even adjusted for inflation.

 

Now, interestingly, gas prices are still not overwhelmingly bad. I think its still averaging just under $3. Now, I am sure it will go up into the $3 to $3.50 range soon, but, I think its really surprising that its not a lot higher. Experts are pointing out that demand has been down this fall, keeping prices lower. What is cool about that, to me, is that a couple of the factors involved in that trend are a change in the habits of Americans, along with a slightly more diverse energy base. The use of alternative energy sources, the efforts of people to cut down consumption, etc., may finally be having a positive effect. I think thats fantastic, and its a sign of how much better things could get if we keep pushing new technologies and energy independence.

 

So, I guess I'm saying... nice start, America. Let's dig in and keep it going.