Richmond Fed President Jeffrey Lacker has explained that he opposed QE3 because it's unlikely to boost growth, but if it does, it will lead to higher inflation. The FOMC's sole dissenter added that any improvement in unemployment appears to be held back by impediments that monetary policy can't offset. Finally, buying MBS's, or providing credit to particular economic sectors, "is an inappropriate role" for the Fed and is "the province of the fiscal authorities." [View news story]
Finally, a sensible Fed Member speaks out. Ben, it's not working and doing the same thing over and over again is not going to change the outcome. In the mean time you are bankrupting those attempting to live off of fixed incomes and savings accounts. Give it a rest.
Microsoft (MSFT) needs to hike its quarterly dividend by $0.03/share at next week's board meeting to keep investors happy, says MKM. The company announced a $0.04/share hike at last year's meeting, though a more modest increase is expected this time. MKM, which rates Microsoft a Neutral, is cutting its estimates due to both the usual set of PC-related concerns, and worries mixed reviews and OEM concerns about Windows 8 spell "a more elongated upgrade cycle." (previous) [View news story]
If MSFT is serious about smartphones it should buy RIMM. Use the excess cash to acquire millions of smartphone users if you want into that business.
It appears that many investors are commemorating the fourth anniversary of the bankruptcy of Lehman Brothers by telling themselves that any Lehman-like danger has passed, and staging a huge rally in its honor, says Mark Hulbert. Actually, he quips, the real impetus was that the Fed basically concluded that the economy is in such horrible shape that it needs even more life support. This all goes to show how inscrutable — and, therefore, ultimately unpredictable — the markets can be. [View news story]
Capitulation by Investors who are looking for any possible positive return on their slowly depreciating US dollars is driving the stock market higher. Utter and total collapse of stocks might destroy the American experiment.
Republican House Speaker John Boehner says he’s not sure Congress and President Obama can reach a deal to avoid the fiscal cliff. “I’m not confident at all,” Boehner quips. It may just be electioneering by the Republicans to keep the heat on the President going into October, but it's risky banter with a resolution already priced into the markets - like we have right now. [View news story]
The problem here is that neither side is willing to compromise. When the poop really hits the fan, and it will, it may be too late to save an already fragile economy. The morons on Capital Hill lack the nads necessary to tell the American people the sad truth, "nothing is free, someone has to pay for the free lunch."
The economy should hit its stride late into next year, says Moody's Analytic's Mark Zandi. He's forecasting 4% growth into 2014, citing continued strength in U.S. corporations due to cost cuts and better profit margins. All we need to do is "nail down those fiscal issues," Zandi says. “By 2014-15, the surprise is going to be how strong the economy is growing.” [View news story]
A judge yesterday rejected a plan by Residential Capital to pay 17 senior execs incentive bonuses of up to $7M, saying that the payouts were retentive rather than incentivized. The judge the gave the bankrupt mortgage unit of Ally Financial permission to draft a new plan. [View news story]
The WSJ looks at the contrasting approaches of Virginia and Maryland to tax and spending. The latter's governor, Martin O'Malley, touts his "investment" for its results in education, except that Maryland is losing jobs and rich residents, and often runs out of money. Virginia's unemployment is lower and Governor Bob McDonnell has turned a $6B deficit into a $1B surplus. [View news story]
O'Malley is an Obama buffoon at best and a poor band member at least.
The WSJ looks at the contrasting approaches of Virginia and Maryland to tax and spending. The latter's governor, Martin O'Malley, touts his "investment" for its results in education, except that Maryland is losing jobs and rich residents, and often runs out of money. Virginia's unemployment is lower and Governor Bob McDonnell has turned a $6B deficit into a $1B surplus. [View news story]
Close by to Maryland you can try Delaware and Virginia.
The WSJ looks at the contrasting approaches of Virginia and Maryland to tax and spending. The latter's governor, Martin O'Malley, touts his "investment" for its results in education, except that Maryland is losing jobs and rich residents, and often runs out of money. Virginia's unemployment is lower and Governor Bob McDonnell has turned a $6B deficit into a $1B surplus. [View news story]
Maryland, the home of tax and spend liberal politicians who only know how to source government jobs and tax the state's citizens. Long gone are the days of fiscal stability and sanity led by Louis Goldstein. The era of uncontrolled spending was initiated by Parris Glendenning also known locally as Parris "Glenspending". Who never met a liberal or union cause that he could deny funds to. Those who can are voting with their feet and moving to more fiscally responsible states.
Jim Cramer says he's backing away from Caterpillar (CAT) after CEO Doug Oberhelman's downbeat interview. "Even if you think he's trying to keep the expectations low... you don't give an interview like that then blow away the numbers," Cramer says, so he's not revisiting CAT until shares fall into the mid-80s. [View news story]
Cat is either a quality investable stock or it is not. Cramer's "vibes" do not change that one way or another.
Monsanto's (MON) $1B win on Wednesday against rival DuPont (DD) may be vulnerable , according to patent lawyers familiar with the proceedings. The size of the verdict alone - the fourth largest in history - puts it at risk. Two of the three awards that exceeded that amount were thrown out on appeal, and the other was cut by almost two-thirds. Add to the mix that no commercial sales were actually made by DD, and there's precedent, and possibly even a good chance, they could win on appeal. [View news story]
How do you get fined for a patent infringement which neither created any profits nor diverted any revenues. This must have been a Ninth Circuit Case.
Pimco CEO Mohamed El-Erian says the strong jobs report "is not an economic recovery game changer." The picture is still mixed, the economy is healing, but only gradually. Regardless, we won't see much from the Fed either way come September, because it lacks the tools to deal with the underlying problems. (Video) [View news story]
Buckle up boys, we may well be in for four more years of this and worse. BTW, the cliff is fast approaching and no one with any common sense, knowledge or experience is driving the stage coach.
Waukegan Savings Bank of Waukegan, Illinois was closed by regulators on Friday, making it the 40th U.S. bank failure of the year. First Midwest Bank of Itasca, Illinois will assume the $77.5M in deposits, and also purchase its roughly $89M in assets. The cost of the failure to the FDIC: $19.8M. [View news story]
Figure this, $89M of assets (loans and real estate like branches) are being purchased, $77M of deposits (liabilities) are being assumed and yet the FDIC is assuming a loss on the failure of $19.8M. In my world those numbers do not add up. There is either more to the story than stated or this is another example of "special" government accounting. "Splane. it to me Lucy"
Starbucks (SBUX -11.7%) continues to get roasted after missing FQ3 estimates, guiding FQ4 and FY13 forecasts lower, and making downbeat comments on its earnings call about U.S. traffic (slowdown in June), EMEA demand (flat same-store sales), and K-Cup margins. Baird is downgrading Starbucks to Neutral, but Deutsche thinks accelerating unit growth, ongoing same-store sales growth, and lower commodity prices spell a buying opportunity. GMCR -1.3%. DNKN -1.3%. JVA -1.8%. [View news story]
Gas prices down from when? have you bought anything recently? Groceries up, clothing up, insurance up, automobiles up, salaries flat, house prices down but rents up. Get out of your man cave.
Starbucks (SBUX -11.7%) continues to get roasted after missing FQ3 estimates, guiding FQ4 and FY13 forecasts lower, and making downbeat comments on its earnings call about U.S. traffic (slowdown in June), EMEA demand (flat same-store sales), and K-Cup margins. Baird is downgrading Starbucks to Neutral, but Deutsche thinks accelerating unit growth, ongoing same-store sales growth, and lower commodity prices spell a buying opportunity. GMCR -1.3%. DNKN -1.3%. JVA -1.8%. [View news story]
This is an example of the Starbucks affect. When disposable income gets squeezed things like $4.00 coffee drinks become unaffordable and voila consumers stop buying in the volumes the did when things were better. Totally predictable.
Richmond Fed President Jeffrey Lacker has explained that he opposed QE3 because it's unlikely to boost growth, but if it does, it will lead to higher inflation. The FOMC's sole dissenter added that any improvement in unemployment appears to be held back by impediments that monetary policy can't offset. Finally, buying MBS's, or providing credit to particular economic sectors, "is an inappropriate role" for the Fed and is "the province of the fiscal authorities." [View news story]
Microsoft (MSFT) needs to hike its quarterly dividend by $0.03/share at next week's board meeting to keep investors happy, says MKM. The company announced a $0.04/share hike at last year's meeting, though a more modest increase is expected this time. MKM, which rates Microsoft a Neutral, is cutting its estimates due to both the usual set of PC-related concerns, and worries mixed reviews and OEM concerns about Windows 8 spell "a more elongated upgrade cycle." (previous) [View news story]
It appears that many investors are commemorating the fourth anniversary of the bankruptcy of Lehman Brothers by telling themselves that any Lehman-like danger has passed, and staging a huge rally in its honor, says Mark Hulbert. Actually, he quips, the real impetus was that the Fed basically concluded that the economy is in such horrible shape that it needs even more life support. This all goes to show how inscrutable — and, therefore, ultimately unpredictable — the markets can be. [View news story]
Republican House Speaker John Boehner says he’s not sure Congress and President Obama can reach a deal to avoid the fiscal cliff. “I’m not confident at all,” Boehner quips. It may just be electioneering by the Republicans to keep the heat on the President going into October, but it's risky banter with a resolution already priced into the markets - like we have right now. [View news story]
The economy should hit its stride late into next year, says Moody's Analytic's Mark Zandi. He's forecasting 4% growth into 2014, citing continued strength in U.S. corporations due to cost cuts and better profit margins. All we need to do is "nail down those fiscal issues," Zandi says. “By 2014-15, the surprise is going to be how strong the economy is growing.” [View news story]
A judge yesterday rejected a plan by Residential Capital to pay 17 senior execs incentive bonuses of up to $7M, saying that the payouts were retentive rather than incentivized. The judge the gave the bankrupt mortgage unit of Ally Financial permission to draft a new plan. [View news story]
The WSJ looks at the contrasting approaches of Virginia and Maryland to tax and spending. The latter's governor, Martin O'Malley, touts his "investment" for its results in education, except that Maryland is losing jobs and rich residents, and often runs out of money. Virginia's unemployment is lower and Governor Bob McDonnell has turned a $6B deficit into a $1B surplus. [View news story]
The WSJ looks at the contrasting approaches of Virginia and Maryland to tax and spending. The latter's governor, Martin O'Malley, touts his "investment" for its results in education, except that Maryland is losing jobs and rich residents, and often runs out of money. Virginia's unemployment is lower and Governor Bob McDonnell has turned a $6B deficit into a $1B surplus. [View news story]
The WSJ looks at the contrasting approaches of Virginia and Maryland to tax and spending. The latter's governor, Martin O'Malley, touts his "investment" for its results in education, except that Maryland is losing jobs and rich residents, and often runs out of money. Virginia's unemployment is lower and Governor Bob McDonnell has turned a $6B deficit into a $1B surplus. [View news story]
Jim Cramer says he's backing away from Caterpillar (CAT) after CEO Doug Oberhelman's downbeat interview. "Even if you think he's trying to keep the expectations low... you don't give an interview like that then blow away the numbers," Cramer says, so he's not revisiting CAT until shares fall into the mid-80s. [View news story]
Monsanto's (MON) $1B win on Wednesday against rival DuPont (DD) may be vulnerable , according to patent lawyers familiar with the proceedings. The size of the verdict alone - the fourth largest in history - puts it at risk. Two of the three awards that exceeded that amount were thrown out on appeal, and the other was cut by almost two-thirds. Add to the mix that no commercial sales were actually made by DD, and there's precedent, and possibly even a good chance, they could win on appeal. [View news story]
Pimco CEO Mohamed El-Erian says the strong jobs report "is not an economic recovery game changer." The picture is still mixed, the economy is healing, but only gradually. Regardless, we won't see much from the Fed either way come September, because it lacks the tools to deal with the underlying problems. (Video) [View news story]
Waukegan Savings Bank of Waukegan, Illinois was closed by regulators on Friday, making it the 40th U.S. bank failure of the year. First Midwest Bank of Itasca, Illinois will assume the $77.5M in deposits, and also purchase its roughly $89M in assets. The cost of the failure to the FDIC: $19.8M. [View news story]
Starbucks (SBUX -11.7%) continues to get roasted after missing FQ3 estimates, guiding FQ4 and FY13 forecasts lower, and making downbeat comments on its earnings call about U.S. traffic (slowdown in June), EMEA demand (flat same-store sales), and K-Cup margins. Baird is downgrading Starbucks to Neutral, but Deutsche thinks accelerating unit growth, ongoing same-store sales growth, and lower commodity prices spell a buying opportunity. GMCR -1.3%. DNKN -1.3%. JVA -1.8%. [View news story]
Starbucks (SBUX -11.7%) continues to get roasted after missing FQ3 estimates, guiding FQ4 and FY13 forecasts lower, and making downbeat comments on its earnings call about U.S. traffic (slowdown in June), EMEA demand (flat same-store sales), and K-Cup margins. Baird is downgrading Starbucks to Neutral, but Deutsche thinks accelerating unit growth, ongoing same-store sales growth, and lower commodity prices spell a buying opportunity. GMCR -1.3%. DNKN -1.3%. JVA -1.8%. [View news story]