Heckuva job, Karl: The GOP "thumping" barely gave markets much of a pause this week. After a strong start — helped by a bevy of private equity and M&A deals — the markets paused a bit to digest the extent of the politcla realignment. Equities floundered towards week’s end.
So far, the first big loser (aside from those pols who lost their jobs) has been big Pharma and health care, which took it
up the wazoo on the chin once it was clear the Senate was changing hands also.
Making the rounds through Wall Street’s echo chamber is that investors had "priced in" a GOP loss in the House of Representatives, but not the Senate. I suspect that is an overly narrow view of the political realignment that took place. Also repeated ad nauseum: Gridlock is good.
Maybe. If the situation were desirable, than perhaps gridlock can hold that in place. However, where the environment and trends are weakening, then maybe gridlock isn’t an ideal political scenario — at least if you hope to get anything accomplished.
As we head into the middle of November, we can look forward to Retail Sales numbers, PPI and CPI (inflation), Industrial Production, and Housing Starts. We also get the FOMC Minutes, and some Fed speechifying.
But none of that is til Monday — its the weekend, and you know what that means: Linkus Festivus!
• The papers are chock full of fingerpointing: Who deserves the credit — or blame — for the Democratic rout? And who wins and loses after the GOP fall? My own post-mortem is here; and we pulled together a good cross section of Blogger’s Take on The US Elections here
• Astonishing: Just how bad was the rout? Using Senate numbers only, the Dems, with 31,591,495 votes, took 55%, versus the GOP’s 45%. This is a much bigger shit than 1994 in terms of votes percentages. How did this happen? A combination of Voters in the center, and surprisingly, The Rich — many of whom aren’t Republican anymore; Across the pond, FT observed US voters in resounding call for
• Caroline Baum hopes that Divided Government will mean Less
Economic Meddling; However, Business may face greater Congressional scrutiny
• Anonymizing Bad Analyst Coverage by rewriting history: nearly twenty thousand "pervasive and non-random" changes of an unusual nature in I/B/E/S/ analyst coverage suggests that firms are losing analysts’ names — on purpose — on bad stock calls. The research suggests that particularly embarrassing recommendations are most likely to be anonymized.
The Wall of worry continues to build:
• Morgan Stanley’s Stephen Roach says Wrong Time for Gridlock
• The NYPost’s John Crudele wants to know why U.S. TREASURY IS DOING THE FED’S WORK• A Bloomberg video twofer:
former CBO Director Douglas Holtz-Eakin Says U.S. Government Will Focus on Budget
• Paul Kasriel asks Are We Near a Bottom in Housing?
• Most Realtors haven’t been in the business long enough to see anything but a boom market, and the current slump is new to all but a handful of industry veterans
• Its not all bleak: Home loan demand rises as mortgage refinancing surges
• Trading in housing prices reflects pressure, not panic
• For Sale, By the Owner’s Ego Why do some homes sell faster than others — even the same models on the same block? EGO
• Chief target for many critics has been the NAR’s Chief Economist David Lereah is being cyber-stalked by some unhappy Home buyers: There is now a blog tracking him, (David Lereah Watch) and some mashups on YouTube (Is Florida’s this century’s California?). Someone even set up a MySpace page for him; 1st friend? Satan;
• Bernanke say Fed does not rely on money growth;
• ECB President Jean-Claude Trichet and Bernanke differ on Strategy, Money Supply
• Fed’s Moskow Says Inflation Is Greater Risk Than Slower Growth
• Mark Hulbert notes that top-performing newsletters aren’t bullish on U.S. stocks: An underwhelming vote of confidence
• A $5 painting found at a thrift shop may be a $9 million Jackson Pollack
• Want to see a surefire way to guarantee a windfall profit tax? Oil Industry Barely Boosted Investment in Production; See also: IEA calls for investment to avert global energy shortage
• Iraqi official: 150,000 civilians feared dead
• MarketWatch nominates Jon Stewart and Stephen Colbert to be Time magazine Person(s) of the Year.
• The Great Media Shake-out is upon us
Technology & Science
• I’ve played with this and its way cool: Microsoft debuts Google Earth killer be sure to use birds eye view
• Good riddance: Rebates on the Way to Expiring
• Divide and Conquer: Cringely writes that the Microsoft/Novell deal is more about disruption than cooperation
• Gartner: Zune not in the Christmas race with iPod
Music Books Movies TV Fun!
• I received Diane Ackerman’s An Alchemy of Mind: The Marvel and Mystery of the Brain as a gift — its a fascinating (non market) read.
• I finally got around to watching Kill Bill 1: Awesome bloodshed!
• Great airplane viewing: 1st season of Entourage
• Colbert Calls it Quits: Mr. Colbert gets mad over the recent election results and says good bye america
• Sculptures — made of toothpicks!
• Norway keeps the streak alive, ranked best place to live. (U.S.? 8th)
• An Onion twofer: Politicians Sweep Midterm Elections and Rumsfeld: ‘My Half-Assed Job Here Is Done’; see also Andy Borowitz: Democrats, Republicans Agree to Take Two Years Off; the Two Parties Find Common Ground in Decision Not to Work
• "Office Space" recut into a slasher/thriller trailer.
That’s all from my corner of the NorthEast, where Thanksgiving is but 10 days away. Do I even bother dieting before hand, or is this a lost cause?