Back in the studio for the regular appearance with Kudlow tonite, at 5:00 – 5:25pm.
The topics will include "Nuts with Nukes," Google/You Tube, The Economy, and a brand new Earnings Season.
Guests include the Goldilocks herself: Diane Swonk (of Mesiro Financial), the erudite Nouriel Roubini of NYU, and Dennis Kneale, Forbes.
A few random thoughts about these items:
• Google’s Purchase of You Tube was essentially "free" given the stock rise since the trial balloon;
• The markets have ignored NK’s nukes, reminding us there is a fine line between Resilience and Complacency;
• The Odds of GOP Retaining Congressional Control continue to slide; This could create both a sell-off in November and a buying opportunity in the event of a correction; It may even see some spending discipline come back into Congress via PayGo.
• Negative Earnings preannouncements have outweighed positive ones for the first time in many quarters; This has also been the first quarter that saw dividend increases falter;
• Housing remains in the early stage of correction
• The market just refuses to go down — its fairly astonishing; This will continue until one day when it suddenly stops;
Should be a gas . . .
BR: You predicted the DJIA would close at 6800 in 2006 during the start of the year. While I too am bearish, do try to explain how we get there from where we are now during your CNBC appearance. Have you changed your mind since then?
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BR:
I don’t know if we will hit 6,800 before 12.31.06, but I am looking for a major correction between now and then.
Incidentally, where are the props for the high call before the fall? My numbers in the article you linked to were S&P 1,350 and Dow 11,800, which are w/i 1% of. (The Nasdaq is nowhere near my prediction of 2620).
Why? Barry was to low, I even told him he was to low, but down to 9000 is a good possiblity, especially with the manipulation that has driven stocks.
The shades of 73 continue, will NBER start the Recession in November this year as in 73 for more similiarities lol.
I’m having difficulty putting a strong downtrend into play, because the movements in various areas are still in unison. We’ve had rising equities with rising bonds with rising commodities. Then equities had a small blowoff in May. Commodities have blown off, but now they same to be tracking equities again, specifically oil.
I think the largest threat we face is stagflation. When one of those pieces breaks off, one can better predict year end. If inflation becomes the dominant trend, we could be at DOW 12-13K by year end. If inflation is actually contained, we could have a good old fashioned recession. DOW maybe 9-10K by YE.
how was Roubini…anybody see?? cant beleive i missed….
He was very good —
how was Roubini…anybody see?? cant beleive i missed….
This is pretty much as to what he said:
“Remember that in 2001 95% of all economic forecasters predicted in March 2001 no recession that year; too bad that the economy had already entered into a recession by March 2001. The wishful hope of forecasters and markets was that the Fed easing would rescue the economy and that the economy would experience a second half rebound. Indeed, in typical suckers’ rally mode the S&P index rallied a whopping 18% in April and May 2001. It was only in June 2001 when even more severe signs of a recession clearly emerged that the stock market started to rapidly tank into a free fall. So, such stock markets suckers’ rallies are very common at the outset of the recession. The reality is that stock markets are often wrong: sometimes they predict recessions that do not occur but, at times like in 2001, they fail to predict recessions that are already ongoing.”
http://www.rgemonitor.com/blog/roubini/151241/
I would not believe it if I did not hear it myself.
Cramer has officially declared today on national TV that the recession is over and everyone should sell all defensive stocks and start loading up on cyclicals. He said that he got two 100% conformations last week (retail sales and jobs revisions) and he is 100% certain we are having soft landing and taking off for another cycle of exponential growth in the beginning of 2007.
He also said that he is not a flip-flopper. He simply thinks that 6 months of slowdown was enough for this cycle and he is positive about the start of a new cycle. He strongly suggested loading up with cyclical stocks.
(Never mind that one of his favorite picks Alcoa has missed earnings today by 20% and was down by 7% in after-hours trading)
The show was a good one.
Let’s give Kudlow a little slack… I actually think he’s a lot more capable of changing his mind when the conditions suggest it than many of us have given him credit for. He’s playing Devil’s Advocate in supporting the “stronger economy front,” but if the tide clearly turns, my guess is that he won’t be the last boat to up-anchor.
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If we see a 1.0% GDP (or under) on this next release, then Roubini will be a Houdini.
Good job tonight, BR. Looks like you were having fun on the sit-n-spin… you looked a little like a rubber duck at a shootin’ gallery at the state fair.
Clink!… spin Clink!… spin Clink!
Ha Ha…. all in fun… all in fun.
A pull back here would be welcome. A nice 75 pt plunge on Thursday in the “new highs” dow would be a nice set up for next week’s expiration.
Sometimes we don’t get what we want. But we get what we need.
Would be nice if I could see this on the web…..
Hint!
Interesting statistic:
“Another warning sign is that new-car sales are down about 5 percent from a year ago. This has happened six times over the past 40 years, and in every instance the economy was either lapsing into recession or already in recession.”
http://www.chicagotribune.com/business/chi-0610090173oct09,0,3010932.story
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BR
We addressed this a few weeks ago: The Car Dealer Doldrums Indicator
Larry is far more circumspect off camera than you would imagine. He likes the debate, but I suspect a recession would not surprise him.
Larry’s a very bright guy , has had a very accomplished career and , most importantly ,
is a great guy
BR ,
you should always defend his honor to all of the cheap shots he receives from this blog