[Posted 7:00 AM ET]
Tech Rocks
So on Wednesday evening I went to my Lions Club meeting and
was greeted by a few of the guys thusly, “Hey, nice call on
Nasdaq!” Doh!
You see, last Sunday I was referred to in an article for the Star-
Ledger, the state paper of New Jersey, and it said the following,
“Not all our forecasters are bullish on tech. Brian Trumbore…is
one such bear. He feels the time has come for investors to start
moving away from the sector. Technology stocks…are now way
overvalued.”
After just one week in 2004 I’m already behind the eight ball as
Nasdaq rose 4%. Things move so fast these days that sometimes
you just wish you could stop time, even for just an hour, to
collect your thoughts without all the noise. But let me tell you
what I think is really going on with the latest wave of euphoria to
hit the tech sector, prior to Friday’s late mini-meltdown. It feels
like 1999 all over again. I exited tech at the beginning of that
year, started StocksandNews, and immediately commenced
railing about valuations, all the way to Nasdaq 5048 on March
10, 2000. It was a joke, I kept warning everyone, and then when
Nasdaq crashed that spring, I was quoted in the same Star-Ledger
on 4/16/00 as follows:
“In my newsletter last week, I have in big, bold, capital letters,
‘THE MARKET IS STILL GROSSLY OVERVALUED.’ I still
feel that way.”
Of course I was bang on, but for about 15 months prior to that
the handful of us that were skeptics looked like idiots.
And so, my fellow readers, once again I may look rather foolish
for months to come as there is a chance the new euphoria builds
to a point where the head on your pint is quite frothy, with
commentators once again saying “we are entering a new era.”
I’ll just sit back smugly, play with my oil stocks and my cash and
think, let’s see where we’re at in another year or so.
So why did everyone in techland get so excited this week in
particular? There was legitimate good news, that’s for sure, such
as in the fact global chip sales were up 26% in November, Nokia
raised its earning estimates, and Nortel received a large
equipment order from Verizon, thus also spurring demand in
Nortel’s rival, Lucent. No doubt, capital spending is on the
rebound and all manner of beaten down issues have been rallying
for the better part of a year now in the hope that a rising tide, or a
big order, lifts all of them. But it’s not as if earnings projections
for ’04 and ’05 aren’t already substantially higher, and for all but
a handful (mostly the bigger names) valuations are shooting right
back to the bubble levels of yesteryear.
But I’ve also heard the argument, this time is different because
we are in a new kind of economic environment than we were in
2000. Folks, I went back through the world’s best history of the
last 5 years, the archives for this column, and the same exuberant
comments were being made then.
So enjoy the ride if you’re in it. I even have a little 2% position
of my own in an Internet telephony play that’s up big in a few
weeks. Just remember that when it comes to tech, it’s a sector
that eats its young, this time is not different, and valuations
matter.
—
As I wrote last week in forecasting 2004, the first half will be
mostly positive on the economic front, it’s the second half I have
a problem with, though I also said “job growth will be anemic”
throughout. But, geezuz, I didn’t foresee a jobs report number
for December as low as was reported on Friday, only 1,000 new
positions having been created. I can’t say I know any of this
select group, perhaps you do, but I hope they appreciate just how
fortunate they really are, I guess.
Of course the government’s data is basically a bunch of garbage,
quite frankly, and we were told this week that the labor force
actually shrank, thus the unemployment rate fell to 5.7%. In
other words, a lot of people just threw in the towel. Tragic.
What I do know is investor sentiment is still way too bullish,
insider selling is at historic levels, outsourcing continues, and the
average American family has $7,000 in credit card debt, a rather
significant sum.
But I want to take a moment to switch gears and talk about
energy and the intensifying fight between Japan and China over
Russian oil. For starters, with China’s booming economy it has
also had to institute widespread rationing because the needs from
development are far outstripping supply. China can’t fulfill its
demand fast enough, and it’s becoming too dependent on the still
shaky Middle East.
But as James Brooke pointed out in a piece for the New York
times, both China and Japan are scrapping over who gets the next
Russian oil pipeline in the Far East. This could be Russian
President Vladimir Putin’s toughest decision of the year, and
with far reaching consequences. Plus to compound matters for
Japan, China’s infrastructure in terms of new refineries and
terminals is further along than Japan’s, where like everything
else development plans have stagnated (though I’m betting with
my own money this is changing).
I have written past stories both here and for my “Hott Spotts”
link on the coming clash in Asia over energy, which could be the
genesis of World War IV, if we’re in agreement that we’re
currently in WW III, but the conflict just might come about years
before I thought it would.
Street Bytes
–It was the 7th straight weekly gain for both the Dow Jones and
S&P 500, with the Dow finishing up 0.5% to 10458 while the
S&P rose 1.2% to 1121. Friday’s Dow decline of 133 points is
being viewed as not much more than a bout of profit-taking. The
aforementioned Nasdaq closed at a 29-month high of 2086.
There was a lot of talk about the increased volume, and the gross
numbers were the best in about 6 months, but it does need to be
pointed out that with regards to the NYSE, a significant portion
was in Lucent and Nortel, two more or less $5 stocks. It’s also
important to note that program trading is dominating the action,
with Friday being a prime example.
–U.S. Treasury Yields
6-mo. 0.96% 2-yr. 1.66% 10-yr. 4.08% 30-yr. 4.96%
Rates plummeted following the lousy employment report, which
lent further credence to the belief that the Federal Reserve will
hold the line on any interest rate increases until the 3rd quarter at
the earliest (I still say they raise ‘em in May). In addition, Fed
Governor Bernanke spooked the bond market early in the week
when he downplayed the risk of a crisis in the U.S. dollar.
Which, if you follow his logic, means rate increases wouldn’t be
in the offing since there would be no need to defend the currency
by doing so. Of course the dollar then continued to weaken,
anyway, and, yes, we will have a currency crisis.
–Economist Arthur Laffer (Mr. Supply Side Economics) had a
piece in Barron’s wherein he talked about how conventional
price / earnings analysis was “hopelessly flawed.” The article
then goes on and on with his calculations showing how grossly
undervalued the market is today. For starters, it’s all a crock and
just another sign that we are slipping right back into the 1999-
2000 trap. Back then leading strategists were issuing the same
idiotic statements, including one well known figure, Ed
Kerschner, who said P/Es in excess of 100 didn’t matter. Of
course like now we were talking mostly about tech back then and
I saw in my archives that on the very day Nasdaq peaked,
3/10/00, the Wall Street Journal had a column headlined
“Conservative Investors Finally Are Saying: Maybe Tech Isn’t A
Fad.”
–Last week I questioned the rush into all the China IPOs,
particularly since we can’t trust the numbers until we have more
comfort with the overall China experience. So on Monday the
Journal had this headline: “Credit Ratings In China Can Be Mere
Guesswork” and the report went on to say “faulty accounting,
poor corporate governance and a lack of disclosure hamper the
raters’ efforts.” But we’ll all plow into the shares anyway, like
lemmings to the sea, as U.S. investment banks lead the
underwriting effort and wrack up huge fees. Then about a year
from now, when the China bubble bursts, we’ll all go “what
happened?”
–The eagerly awaited Google IPO has been awarded to Goldman
Sachs and Morgan Stanley, so to mark this special occasion we
have assembled the cast of “Hee-Haw.” “Sa-lute!”
–I caught a little grief from one of my broker friends last week
because of my semi-annual comment on the concept of
“duration” and bond funds. Don’t overcomplicate this, folks.
Simply put, duration is the easiest way to measure the sensitivity
of a portfolio due to a change in interest rates. With bond funds,
if I say the duration is 4 and rates move up 1% (prices down),
your fund’s net asset value will drop around 4%. If rates move
up 2%, you’d lose about 8%. If rates fell 1%, you’d pick up 4%.
Then you add in your distribution rate to get a total return.
Granted, it doesn’t always work out exactly to the penny, as not
all segments of the yield curve, or the individual bonds in the
portfolio, are moving up or down at the same pace, but it’s a
terrific way to gauge risk and my financial advisor buddies know
that when you sit down with a client and present any bond fund
you use duration to learn more about the client’s risk tolerance,
for starters.
I bring the topic up now because 1) I worked for a fund company
that introduced the whole concept years ago, and 2) I think rates
are heading higher, maybe substantially. Probably not tomorrow,
but certainly by a year from now. Some bond funds will get
whacked, should this occur, especially the leveraged ones. But
also remember, corporate bonds can be different and generally
move up or down based on the strength of the economy, or lack
thereof. So you have to have a little different mindset here,
particularly with regards to junk bonds, the sector that performed
so spectacularly last year. Enough said. That’s your 2-minute
refresher course.
–The brokerage firm E.D. Jones was featured on the front page
of Friday’s Journal for its aggressive use of a focus or preferred
list of mutual funds that are then rammed down the sales forces’
throats due to revenue sharing agreements with the select few. I
had to deal with this when I was at PIMCO (PIMCO still isn’t a
participant in the Jones program) and it was more than a bit
frustrating. Along with Morgan Stanley, no one put up more
roadblocks than Jones did. The brokers, who weren’t necessarily
at fault, had to obtain special permission in most cases to sell a
fund outside the focus list and it meant that the clients weren’t
always being shown the most appropriate offerings.
–Then there is the case of 2003’s “StocksandNews Sleazeball of
the Year” Dick Grasso. Now the issue of his outrageous
compensation will be investigated by both New York Attorney
General Eliot Spitzer and the SEC at the recommendation of
interim NYSE Chairman John Reed, for which we give Mr. Reed
credit. The independent report that Reed requested is damning
and up to $150 million of Grasso’s comp could be confiscated,
assuming authorities can find it.
One of the key points of the report is actually the pay of Grasso’s
secretary, $250,000, because it just so happens to be the average
compensation for a not-for-profit CEO, the NYSE falling under
that description. Heck, Grasso saw fit to pay his two drivers
$125,000 apiece.
–Morgan Stanley’s chief strategist, Steve Galbraith, a highly
respected one, is off to hedge fund land.
–If you think I have a negative forecast for the broad market
averages for 2004 (only down 9-12%), how about poor Richard
Bernstein of Merrill Lynch? His S&P 500 yearend target is 890
(I’m at 975). Years ago Donald Straszheim was taken out and
shot by Merrill for being too negative (Straszheim proved to be
right) and you have to wonder about Bernstein’s fate by January
’05. Hang in there, Richard. Your day will come.
[Straszheim was pardoned at the last minute and is now running
his own shop.]
–Detroit’s Big 3 automakers now garner only 63% of the U.S.
car market.
–Here’s the skinny on mad cow and prior U.S. efforts to prevent
it from becoming an issue. As you are now aware the U.S.
slaughtered 36 million cattle last year and tested only 20,000 for
the disease. Compare that to Japan, where 1.2 million were
sliced and diced and 1.2 million were tested. Or Europe, where it
was 27 million ground into burgers and 10 million tested.
With all due respect, my fellow Americans, we have zero right to
now ask the Japanese to lift their current ban on U.S. beef until
more time has passed and our Agriculture Department is certain
we don’t have a bigger issue, especially since we have yet to lift
the ban on Japanese beef after their own scare, even though they
now test virtually every single animal.
In the meantime, yours truly has continued to fire up the George
Foreman Grill and is eating burgers like they’re going out of
style. Actually, you don’t really fire up a George Foreman Grill
…you plug it in…but the fat rolls down the griddle…then again,
the BSE prions stick to it forever.
–Speaking of cows, what did I tell you last week about Gateway
and its lousy performance the past few years? I said it had to be
due to the fact they were employing “downer” cows. So on
Monday, Gateway reported poor 4th quarter sales. I rest my case.
–Former Tyco CEO Dennis Kozlowski’s secretary testified at
his fraud trial that a Tyco loan program was used by the dufus to
buy his wife a $5 million diamond ring. And we learned the
secretary, Tammy Cross, was no ordinary assistant, as she rose to
become Kozlousy’s financial assistant and personally approved
his purchase of a $4 million Monet for his Manhattan pied-a-
terre. Actually, I like Monet. It’s Manet I have a real problem
with.
–My friend Harry K. and I share a love of energy stocks and we
always get a kick out of the talk from energy traders this time of
year, as the oil and natural gas contracts whip around based on
the weather. Harry hails from the Great White North.
“Am I missing something? It’s like, omigosh, it’s cold out, buy
gas. Doh! It IS January, after all. Wintertime – when cold
weather is expected. So go out and flood the backyard already.”
And as our two portfolios have perked up recently with the
latest Arctic blast, Harry reminds us energy bulls of the seasonal
song, “Oh, the weather outside is frightful…for my portfolio
it’s delightful…”
There was some real corporate news on the energy front that was
important this week, that being Royal Dutch / Shell’s disclosure
that its proven reserves of oil and gas are about 20% lower than
once thought. That means one thing, sports fans, they better do
more drilling.
–My portfolio: The drillers are performing nicely, though I did
jettison the Polish exploration company for a small gain.
Nothing against it, I just realized I don’t know as much about the
operation as I should and I’m trying to cull my more speculative
plays these days. I also sold that idiotic eBay ‘put’ position I
wrote of. Yeah, I lost a couple of hundred bucks…just another
lesson learned. [Unfortunately, I sold the eBay before Friday’s
decline.] Anyway, when all was tallied up I remain about 40%
equities, 60% cash, with 32%, overall, in energy.
—
What Can Go Right? What Can Go Wrong?
I actually play this exercise every day. Or to put it another way,
what the heck am I missing?
But after last week’s reminder to always be prepared for the
worst, at least in the handling of your finances in these days of
terror, let me present my early picks for 2004 “Men of the Year,”
Afghan President Hamid Karzai and Pakistan’s President Pervez
Musharraf. But there’s a rather significant catch. They both
have to stay alive.
Just think of the possibilities if they do, however. Afghanistan’s
Loya Jirga settled on a new constitution that contains a powerful
presidency, Karzai’s chief request, while President Musharraf
continued to confound the experts with his deft political skills as
he reached out yet again to Indian Prime Minister Vajpayee,
sparking a new round of peace talks over the general relationship
between the two countries, including the vital issue of Kashmir.
Vajpayee, 79, has always wanted to cement his own legacy so
when talks resume, who knows what will happen? Could it be
that the world breathes a sigh of relief as they stand down their
nukes?
OK, back to reality. Musharraf can obviously be taken out at any
minute by extremists, and the happy reviews for Afghanistan’s
Loya Jirga were frankly a bit over the top. Karzai is a truly
heroic and, one hopes, historic figure, but this constitution papers
over huge conflicts, including the possibility Sharia law (not
good) could be imposed at any moment, particularly since an
Islamist supreme court will interpret all laws. Plus, the warlords
still run amok and there is real doubt the elections slated for June
will come off due to the ongoing violence in wide parts of the
country.
Meanwhile, moving west a bit, in Iraq the June 30 deadline for
national elections here is a joke. I agree with the premise of an
op-ed piece in the Washington Post by Amy Chua and Jed
Rubenfeld. The government should be established from the
bottom up, not the top down as the U.S. and the Iraqi Governing
Council would have it. Plus, there is no way we will settle all the
ethnic differences by June, if ever, though on this last point as a
supporter of the war I have to hold out hope…I just don’t have
much for this year.
As for the weapons of mass destruction issue, I was surprised the
mass media waited until Colin Powell’s presentation on
Thursday, where he basically admitted the search was going
nowhere, because on Wednesday the Post’s Barton Gellman had
as extensive a report as you’ll find…and for us neocons it wasn’t
pretty. Chief weapons inspector David Kay (whom I admit I had
going out the door a little faster than he actually is) has himself
labeled some of the detective work “embarrassing,” like with the
infamous issue of the two trailers. What’s increasingly clear is
that, yes, Iraq had an extensive, and illegal, missile program, but
the WMD would come later. The fact that 400 weapons
inspectors have either been reassigned or sent home speaks
volumes.
President Bush has a lot going in his favor at the moment and if
the election were held today he runs away with it, but it’s a long
10+ months from now to November. As we’ve come to learn, a
car bomb in Pakistan under Musharraf’s motorcade or an attack
on the homeland can change everything in a huge way. In other
words, wait 24 hours.
China: The nation is dealing with SARS again, so far on a
limited basis, and 10,000 palm (civet) cats, which are really
weasels, are being destroyed because they are seen as dominant
carriers of the SARS virus. The World Health Organization,
though, was very concerned as to how the slaughter is being
carried out because it could make matters worse…like if blood
was spilled. In other words, it’s kind of a disgusting topic.
Meanwhile, Beijing told Hong Kong’s puppet government to
back off on cooperating with the pro-democracy movement; a
rather significant mandate and a stark reminder of just who we’re
dealing with.
But for his part, Taiwan’s President Chen Shui-bian said he was
proceeding with the March 20 referendum that would demand
China dismantle the 500 shiny missiles targeting the island.
And speaking of things shiny, China hopes to launch 10 satellites
in 2004, a rather ambitious goal and another sign of their
growing strength in this field.
North Korea: One ends up writing the same thing over and over
again when it comes to Pyongyang, so until there are new arms
talks, I’ll try not to waste your time or mine. But of course I’ll
also continue to sleep with one eye open, recognizing that
another year without any kind of resolution here means production
of an additional 3-4 nukes…potential stocking stuffers come
Christmastime.
Iran: Despite dissing the United States’ offer of a disaster relief
delegation in the aftermath of the Bam earthquake, there are
some signs the mullahs are re-evaluating the U.S. relationship,
and in a minor step, Iran restored diplomatic ties with Egypt after
almost 25 years (the suspension having to do with Egypt’s
establishment of diplomatic relations with Israel). But I hope
some of you saw the report on “Frontline” Thursday night and
the graphic depiction of the mullahs’ goon squads at work,
particularly against pro-democracy students. The latter have
been so heroic and I still claim that back in 2002 the U.S. had a
shot at toppling the regime if we had more actively supported
their protest efforts. But today, the West needs to be extremely
wary of any agreements signed with Iran on the weapons front.
There’s a good reason why the country is part of an “axis of
evil.” These are men doing Satan’s work.
Russia: The Kremlin reported that economic growth reached
6.8% in 2003, thanks almost solely to the big spike in oil prices.
Remember, $21 oil is a key figure here, below which the country
struggles.
But on the empire-building front, Georgia held its presidential
elections and 36-year-old U.S.-educated Mikhail Saakashvili is
the new man in charge. This will be interesting to follow
because he is a pro-West kind of guy, which of course the
Kremlin hates, and he’s inherited some gigantic problems. But
he also received 85% of the vote. We wish him luck in fending
off Russia’s tentacles.
Israel: Interesting piece in Newsweek concerning Mordechai
Vanunu, who back in 1986 spilled the beans on Israel’s nuclear
arsenal and since has been in an Israeli prison. His term is about
to expire, however, and the controversy is over whether he
should continue to be detained or released. The odds are good
that as a free man he could “become a powerful agitator for the
dismantling of Israel’s nuclear weapons.” [Dan Ephron]
Just last week I mentioned that the U.S.-British brokered deal
with Libya could lead to further calls from Middle East nations
for Israel to dismantle its own weapons of mass destruction. In
other words, the Sharon government, and future Israeli
administrations, will likely find themselves in quite a box, but
then the country is used to it.
Random Musings
–Finally, the presidential primaries are here and it’s going to be
fascinating, especially with Wesley Clark’s apparent surge in
New Hampshire and elsewhere. And some of these polls make
for great debate, especially the latest USA Today / CNN / Gallup
survey.
For example, President Bush’s approval rating on the economy is
up to 54%, a very solid number (Bush #41 was at 24% at the
same stage), and when you ask the question “Are you satisfied
with the way things are going in the U.S.?” it’s now 55-43 ‘yes,’
versus 42-56 a year ago. So Bush is kicking butt, to the tune of
59-37 in a match-up against Howard Dean (according to the
same survey).
Actually, the 59-37 Bush advantage over Dean is a reflection of
the approval rating for the Democrat. In the same poll, Dean is
viewed “favorably” by just 28% of the voters, “unfavorably” by
39%. [The rest have no opinion as yet.] Bush, though, is at 65-
35 favorable / unfavorable.
The only Democrat with a net favorable is Clark at 37-26.
Nationwide, among likely Democratic voters, it’s…
Dean 24%
Clark 20%…it was 31-10, Dean, just 3 weeks earlier.
Kerry 11%
Lieberman 10%
Gephardt 9%
Mr. Magoo 7%
Pete Rose 1%
–Uh oh…doesn’t sound like President Bush is going to like
former Treasury Secretary Paul O’Neill’s piece on “60 Minutes”
this week.
–Did you see General Clark’s tax plan? A family of four with
income under $50,000 would pay zero federal taxes and Clark
would repeal the tax cuts on those making more than $200,000,
while then further raising taxes an additional 5% on incomes
over $1 million. Well that would cut into the luxury car market.
But when I listen to Clark, as I did on Chris Matthews’
“Hardball” program the other night, it struck me that Clark has
some Dan Rather in him. “What’s the frequency, Kenneth?”
–I don’t know why, but I’m cutting Hillary slack this week with
regards to her Gandhi joke. Of course it was incredibly stupid.
–From a Sunday Times Magazine piece by James Traub.
“Michael O’Hanlon, a senior fellow at the Brookings Institution,
has a nightmare in which Dean wins the nomination, conditions
in Iraq improve modestly and in the course of a debate, President
Bush says: “Go to Iraq and see the mass graves. Have you been,
Governor Dean?” In this nightmare, Bush has been, and Dean
hasn’t. “Saddam killed 300,000 people. He gassed many of
these people. You mean I should have thought there were no
chemical weapons in the hands of a guy who impeded our
inspectors for 12 years and gassed his own people and the
Iranians?”
Yup, that’s about the shape of things.
–Republican John Thune is challenging Tom Daschle for the
latter’s Senate seat. This will be interesting. Thune knows all
too well from past experience that the Indians on the Pine Ridge
Reservation, especially the dead ones, are known to vote early
and often for their Democrats. [If you’re new to the site, you
should know I’ve been to Pine Ridge.]
–If you are interested in the Pete Rose story, as I am, I urge you
to pull up my 1/8 edition of “Bar Chat.” I review the history of
the case there. Personally, I never believed the jerk and his
whole act this past week has backfired in a big way. Rose and
Connecticut’s Governor John Rowland have appropriately been
tied together, too, but I haven’t seen anyone put them with Al
Sharpton. It’s now been 17 years since Sharpton’s episode with
Tawana Brawley, 17 years without an apology for his criminal
act in the case. And yet many members of the press refuse to
attack him on it, further legitimizing his sham run for the
presidency. Why? Because he is quick with a one-liner? It’s a
blot on our national character.
–According to a Zogby poll, in the states that George Bush won
in 2000, 67% want a “deeply religious” president. In the states
that Gore won it’s 51%.
–For all the talk of ‘outsourcing,’ look for an increasing backlash
against the actual service or lack thereof. I was talking to the
guys at the Lion’s Club about this and one computer exec related
how his customers are already super ticked off at having to deal
with service desks where English is a second language. When it
begins to impact sales, as it invariably will at some point, the
trend in some areas may slow considerably. [Business Week
also touched on a similar argument about two weeks ago.]
–As a big proponent of manned space travel, I obviously support
the president’s soon to be released plans in this area. No doubt
there will be a lot of shrill talk on the costs, and perhaps if we are
to establish a base on the moon we should then jettison the space
station (removing the astronauts first, of course… “I thought you
were going to pick them up!” “Me? I thought that was your
job!”).
And you’ll hear all this talk about how the human body can’t
stand the rigors of a lengthy flight to Mars, as well as the levels
of radiation on the Red Planet. Just remember my solution of
long ago… send the snowboarders. They’d get stoked for this
kind of ride.
–Governor Arnold Schwarzenegger gave his “State of the State”
address, promising plenty of ballot initiatives designed to skirt
the legislature, including the key $15 billion bond issue slated for
a referendum in March. But thanks to the budget crisis, the
governor will have to take some unpopular steps in slashing
social programs and in hiking tuition at state schools.
At this stage, though, it would appear the bond issue will pass,
thus staving off bankruptcy. And then if the economic recovery
across the country continues apace, California will participate in
the upside just like everywhere else and Arnold will be viewed in
a most favorable light. Then, with a moon base on the drawing
board, he could begin planning for a run for president of the
universe, the constitution precluding him from a go at the highest
office in America. That’s just my opinion, I could be wrong.
–California is also front and center when it comes to the
president’s just announced immigration initiative, one designed
to deal with the estimated 8-12 million illegals doing the jobs
you and I would rather not. Bush wants to create a “guest
worker” system where laborers would apply for a card enabling
them to stay in the country for up to 3 years, at which point it
could be renewed. They would also be entitled to all manner of
cash and prizes and advocates claim at least we would then have
a handle on who is mowing our lawns and scrubbing
McDonald’s toilets. Conservatives, though, say it’s amnesty for
lawbreakers and it does nothing to address the lack of security at
our borders.
The above, however, is likely to be more than I will ever write
again on the topic because there is no way Congress touches this
in an election year. Or as Jesse Jackson would say, “The point is
moot.”
–So I’m doing one of my back of the beer coaster calculations
and this is disturbing. Since the lows on the euro of October
2000, the cost of a pint of Guinness in Ireland has climbed from
approximately $3 to about $4.50. So at 6 pints a day that’s $9, or
$63 a week. Could be a deal breaker when considering a trip
over there.
–Sorry, but I’m a supporter of Britain’s Royal Family (I’m a
traditionalist, after all) and this whole controversy over Princess
Di’s death is getting more than a bit absurd. Let it go, my British
friends. It was a tragic drunk-driving accident… end of story.
–Some of you know I have been involved in building a church
on the Micronesian island of Yap (Rumung, specifically). Well
on Thursday I received word from the Jesuits there that a
typhoon hit the island (no one was killed as best as I can
determine) and it looks like the church survived…passing its first
big test. Praise Jesus!
–Frankly, I don’t understand the sudden uproar this week over
the dangers of eating farmed salmon because we’ve already
addressed them. In fact I cited a similar study to the one introduced
this week in this very space back on 9/6/03. But if it helps to get
farmers to use alternative feed, rather than heavily tainted, other
species of fish, all the better. Of course around here at
StocksandNews I have touted “Salmon Sunday” as a way of
staying healthy, but I also joined the Wild Salmon Society. [The
Farmed Salmon Union is a vicious group, by the way.] Then
again, I could just go back to having beer and Chex Mix 7 days a
week.
–I’m watching these new commercials for Welbutrin;
‘effectively deals with depression with no impact on the sex
drive,’ and then you have Levitra, which enables us guys to ‘stay
in the game.’ So I’m thinking; if your portfolio is
underperforming, you should probably take a cocktail of both of
‘em. [Kids, don’t try this at home. You shouldn’t be dabbling in
the market, anyway. Go outside and shoot some hoops.]
—
God bless the men and women of our armed forces.
God bless America.
—
Gold closed at $426
Oil, $34.31
Returns for the week 1/5-1/9
Dow Jones +0.5% [10458]
S&P 500 +1.2% [1121]
S&P MidCap +1.5%
Russell 2000 +2.6%
Nasdaq +4.0% [2086]
Returns for the period 1/1/04-1/9/04
Dow Jones +0.1%
S&P 500 +0.9%
S&P MidCap +1.5%
Russell 2000 +3.3%
Nasdaq +4.2%
Bulls 57.3
Bears 20.4 [Source: Investors Intelligence]
Have a great week. I appreciate your support.
Brian Trumbore
