Wow! Heckuva week, Brownie!
Markets seemed to have made a bottom — at least for now — as sentiment and technical measures reached extremes typically associated with lows on Tuesday. Indices moved up Wednesday, and then exploded Thursday, in a paroxysm of short covering and rampant buying.
I don’t normally like these explosive moves, as there is that discomfiting tendency towards one day wonders. But the markets had become so washed out, there is a very real chance that this could last — at least a month or so. Time will tell.
Lots of interesting stuff out there — lets fire up the linkmachine, and take a quick ride around the web to see what is worth digesting.
• Did you notice? At a point earlier this week, all the major U.S. indices were briefly in the red Year-to-Date;
• This was a key reversal week, and I felt the markets sketched out a "Tradable Low" on Tuesday (at least for a 4 week or so bounce); Others, notably Dennis Gartman, disagreed: "It is not at all safe to buy stocks . . . not here in the U.S.; not in Europe; not in Asia; not in the emerged nor in the emerging markets. This is a bear market and we must understand that; weakness is not to be bought; strength is to sold into." (and people say I’m Bearish).
• Markets sold off two weeks ago on good news (Zarqawi’s death), and rallied this past week on bad new (CPI/PPI inflation data). It was a brief reminder why you should Lose the News;
• Good series at Marketwatch on Shortselling:
• Slate’s Dan Gross asks Why are so many companies purchasing their own shares? The answer is rather suspicious.
• What does Extreme Volatility mean?
• A good stock screener/power searcher from MSN Money;
Its Inflation time, and boy, do we have a lot of stuff for you on this one:
-CNBC’s Steve Liesman was a guest blogger on Monday in How the Fed Chief Gains Credibility;
-Barron’s explains Why Bernanke Is Dead Right on inflation; Fed Watch at economist’s view: Ascendancy of the Hawks; There goes the core! More businesses seek to recoup losses by sharing pain of higher costs with consumers; Irwin Kellener, does not, unfortunately, understand the "cruelest tax"; Fed Governor Randall Kroszner asks Why Are Yield Curves So Flat and Long Rates So Low Globally?; The Philly Fed has a research report on Core Inflation as a Predictor of Total Inflation (I think its crap).
– Rents in U.S. rise at fastest pace in 5 years http://www.azcentral.com/news/articles/0614rents-surge14-ON.html
You know it was a busy week if we are this far along and haven’t yet mentioned Real Estate:
-It turns out that Housing Leads the Economy Up AND Down; Also, the Net Worth of American Households have been unusually dependent on Real Estate the past few years; Amazingly, 30-Year Conventional Mortgage Rates are still historically cheap.
–A new study looks at where housing markets are overvalued; CNNmoney calls it Housing boom 2.0; Bloomberg looks at Where the Riskiest Local U.S. Home Markets are;
–Don’t hand your house to a thief — beware of sleazy mortgage deals;
-The battle between Full-Service Realtor Brokers’ and their Discount Rivals is hurting Consumers (WSJ)
Only a few noteworthy energy/geopolitical items this week;
-Are we at the Last Exit for Diplomacy with Iran?
• Okay, say you have a $300 PC, and you don’t want to spend big bucks on software: here are Free Ways to Do Desktop Work on the Web;
• Alex, I’ll take vaporware for $100: Microsoft said to be developing iPod rival;
On to the fun stuff!
• Three books arrived this week, amd they are all consigned to the queue: O’Shaunessey’s Predicting the Markets of Tomorrow; Greenblatt’s You Can Be a Stock Market Genius; Louise Yamada’s Market Magic;
• Glide magazine suggests 25 New Songs to Download Right Now;
• This is the world’s most important 6-sec drum loop;
• Noah sends this along, and says it may very well be the best 12 minutes you’ll spend today: Freebird (Live at Oakland);
• Try not to enjoy these music videos too much: The pinheads at the RIAA is seeking to once again thwart innovation: Death by DMCA
• And my very favorite blog entry of the week: Cody Willard is My Type
Several reader’s ask how I put together the linkfest. No can do today, as I am beach bound, but perhpas in the coming weeks I can answer that question.
Have a good weekend!