November Linkfest: Week in Preview

Yesterday, we reviewed the week that was. Today, we look at the week that will be.

Stocks and futures markets are open Monday — but since its Veterans’ Day, banks and bond markets are closed. Pending Home Sales Index is released later in the day.

We get a few inflation stats this week: Producer Price Index is due Wednesday, and October’s Consumer Price Index
will follow on Thursday. As you may know, except for all the items going up in price, there’s hardly any inflation at all.

Profitgraph

October’s retail sales report is due Wednesday, and this week, we also hear from many of the retailers on their Q3 profits. Based on what we have seen so far — weak back-to-school raised fears of a dreary Christmas, while what little strength we saw was mostly Food Inflation expectations are muted.

The WSJ asked what department stores had to worry about, "Aside from a swooning housing market, soaring energy prices, a credit crisis and fresh concerns about jobs, [and] one of the balmiest Falls on record." Aside from that Mrs. Lincoln, how was the play?

Reporting in the coming weeks are Macy’s (M), J.C. Penney (JCP), Kohl’s (KOH) Sears Holdings (SHLD), Nordstrom (JWN), Wal-Mart Stores (WMT) and Target (TGT).  Also reporting this week are home Improvement stores Home Depot (HD) and Lowe’s (LOW).

Plenty of Fed chatter in store this week: On Wednesday, Fed Chairman Ben Bernanke speaks about "Monetary Arrangements in the 21st Century." The rest of the elves are pretty busy this week: Fed Governor Randall Kroszner Tuesday, Dallas Fed President Richard Fisher Wednesday, Thursday is Chicago Fed President Charles Evans and Kansas City Fed President Thomas Hoenig. Atlanta Fed President Dennis Lockhart on Friday.

Regardless, there’s plenty of interesting thing to digest this week. Loosen up your mousing wrist, its time to get clickin’:

INVESTING & TRADING

Is the Market Finally Waking Up?  is this a sign that the economy is in real trouble, as some investors believe? Or is this simply a knee-jerk reaction to the continuing trouble in the credit markets?    (New York Times)

• Be sure to vote in our pool: When Does GM Get Kicked Out of the DJIA?   

Make money in 2008: The outlook:
Given the pervasive gloom in the face of the housing slump and sudden
sharp drops in stock prices earlier this year, you might have figured
it was just a matter of time before the economy would collapse faster
than the Colorado Rockies in the World Series. The litany of depressing
news has only seemed to get worse since then: surging oil prices,
mortgage defaults, investment banks writing off subprime loans, the
dollar skidding to new lows – pass the Prozac.  Well, we’ve got two
words for you: Cheer up. If you delve behind the headlines, you’ll find
that despite all of these challenges, the economy has actually held up
pretty well this year. And key indicators suggest that next year should
be even better . . . (Money Magazine)

• Here’s an unpleasant thought: What if the Financials are Worse than they look?   

As Oil Soars, Natural Gas Is a Bargain:
As oil prices surged over the last few months, natural gas prices in
the United States did something that could help to cushion the economic
shock. They fell.A result is that those who heat their homes with
natural gas — by far the dominant fuel in the United States — will see
prices roughly in line with last winter’s. But for those who use
heating oil, as many do in the Northeast, prices seem likely to be
about 50 percent higher than they were last winter.    

• Barron’s goes Combing Through the Bargain Bin looking for retail stocks on sale (If no Barron’s, go here)

All the right moves: Profit in 2008 The 22 best ways to keep safe, spend smart and make your money grow in the year ahead:
Tumbling home values. Soaring energy prices. A topsy-turvy stock market
and a gazillion other financial worries, not the least of which is
whether we’ll spend the coming year mired in recession.   Considering
all the black clouds hanging over the economy, you probably think
there’s no way you can really expect to prosper in 2008. It will be all
you can do just to hang in there.  If that is what you’re thinking,
we’re happy to tell you that you’re wrong. There will be plenty of
opportunities to make money next year – yes, even in real estate – as
well as ways to insulate your finances from the most serious economic
challenges ahead. (Money Magazine)

Who’s Failing Investors With Bad Information?   

Mathematical Fortune-Telling:
How well can game theory solve business and political disputes?
Predicting the future is not very hard, according to Bruce Bueno de
Mesquita: a little mathematics is all you need. Figuring out how to
manipulate a situation to achieve specific aims is a bit less
straightforward, but Bueno de Mesquita says his mathematical tools can
usually do that, too.  (Science News)

Lessons From Stock Market Wizards

Sentiment watchOur Brains Seem Built for Optimism:
In the palette of human temperament, a rose-colored view of the future
is the dominant hue, regardless of culture or nationality.
Psychologists puzzle over this basic bias for the bright side. This
sense of hope boosts consumer confidence, creates market bubbles and
spurs irrational exuberance. Two research teams exploring the anatomy
of expectations offer a new perspective on the power of a positive
outlook. For the first time, scientists at New York University have
mapped the upbeat brain — finding in a cluster of neurons the size of
a martini olive the seed of a sunny outlook on life. At its core, the
brain is built for optimism, their work suggests. (Wall Street Journal)

So You Want To Trade For A Living

As Energy Prices Soar,  U.S. Industries Collide: So it goes in the sector-by-sector jousting over what to do about America’s voracious energy appetite, which shows little sign of abating despite oil’s lofty price. Yesterday, crude-oil futures on the New York Mercantile Exchange reached a new intraday high of $98.62 a barrel before falling back to finish at $96.37. Amid mounting pressure to curb fossil-fuel use — both to ease the price run-up and to address climate concerns — fights are erupting over who will bear the burden and who might win the spoils.The auto and oil industries are at each other’s throats, with Detroit saying the oil industry should install more ethanol pumps and the oil industry saying Detroit should make cars that are more efficient. Renewable-energy producers are arguing over who qualifies for federal tax breaks. In one spat, producers of U.S. biodiesel, traditionally made from soybeans, are fighting a joint bid by oil giant ConocoPhillips and meat processor Tyson Foods Inc. for access to a credit for "renewable diesel" fuel they would make from animal fat. (free Wall Street Journal) 

Crash is coming, warns top investor (The Age)

The Bond Market’s  Bleak Prognosis for Iraq: After the United States helped Iraq renegotiate its leftover debt from the Saddam Hussein era, the Iraqi government issued about $3 billion of new bonds in January 2006. These dollar-denominated bonds pay 2.9 percent twice a year and mature in 2028, paying the face value of $100. To say the least, the market for these bonds is not robust: as of last week, a bond with a face value of $100 was trading at around $60. Professor Greenstone calculated that, from the markets’ standpoint, the implied default risk over the life of the bond was about 80 percent. (New York Times)

 


ECONOMY

The Wall of worry continues to build:

Fed Chief Warns of Worse Times in the Economy:
Ben S. Bernanke, chairman of the Federal Reserve, told Congress on
Thursday that the economy was going to get worse before it got better,
a message that received a chilly reception from both Wall Street and
politicians. On a day when stock prices swung wildly, the dollar hit
another new low against the euro and further signs emerged from
retailers that consumers are growing more cautious about spending, Mr.
Bernanke warned that the economy was about to “slow noticeably” as the
housing market continues to spiral downward and financial institutions
tighten up on lending. (New York Times)`

• This week we get CPI and PPI data. Even the absurd focus on core inflation can’t hide the truth any longer, as the CRB Index, ex-Food and Energy now reveals.

• The silver lining: Will the High Price of Oil Make Americans Skinnier?  (Freakonomics)

Could California be in recession?
California is on the edge of recession, economists say. Or perhaps the
nation’s most populous state is already in one. "California seems to be
sliding into recession," wrote Jan Hatzius, chief economist for Goldman
Sachs, in a research note earlier this week. Hatzius based his
appraisal on the sharp increase in the unemployment rate in the state
from 4.7% in November 2006 to 5.6% in September 2007. While a 5.6%
jobless rate may seem low, the important thing is how much it’s risen.
Hatzius said any increase of more than 0.6 percentage points in
California’s unemployment rate has always been associated with a
national recession. (Marketwatch)

• Bear Stearn’s David Malpass offers a few belated Lifelines for the Drowning Dollar: Why were we not surprised that he missed the primary cause . . . ?

When magazines such as Vanity Fair turn against you, you know your approval poll ratings are really, really low: The Economic Consequences of Mr. Bush Nobel laureate Joseph E. Stiglitz sees a generation-long struggle to
recoup the damages to the dollar, the economy, and the US
infrastructure: The American economy can take a lot of abuse, but no economy is invincible. When we look back someday at the catastrophe that was the Bush administration, we will think of many things: the tragedy of the Iraq war, the shame of Guantánamo and Abu Ghraib, the erosion of civil liberties. The damage done to the American economy does not make front-page headlines every day, but the repercussions will be felt beyond the lifetime of anyone reading this page.  (Vanity Fair)   


HOUSING

What Market Slump? ALTHOUGH there are many questions about the direction of the Manhattan real estate market, the evidence to date shows that the market remained strong last month, continuing right through the last closings. The number of sales in October was well above the number recorded during the corresponding month a year earlier although a bit behind the huge volume of sales recorded over the summer, according to a tabulation of co-op and condominium transactions that were filed with the city through the first seven days of November. The number of sales of trophy properties costing more than $4 million increased sevenfold from October 2006. (New York Times)

Dump This House: UnloadingYour Property in a Slow Market  (Real Estate Journal)   

Banks Hit Borrowers With Stricter Rules:
More banks are tightening lending standards for home buyers — even
those with good credit — and raising borrowing costs for larger
businesses, according to the Federal Reserve’s latest survey of banks’
senior loan officers.The survey, conducted in the first half of
October, involved 52 domestic banks and 20 foreign institutions. It was
the Fed’s first poll of loan officers since the summer credit crisis.
The Fed received the results by Oct. 18, ahead of last week’s policy
meeting at which it cut its benchmark interest rate by a quarter
percentage point to 4.5%.Speaking in New York yesterday, Fed Governor
Frederic Mishkin signaled little interest in additional interest-rate
cuts. He said he hadn’t seen evidence of "serious spillovers" through
the broader economy from the sharp downturn in the housing market and
the tightening of

Which Markets Move Mortgage Rates? A Primer & The Mortgage Survival Kit  (free Wall Street Journal)   

Housing counselors feeling market crunch:
Homeowners of all ages and income levels have fallen into trouble via
the one-two punch of a softening housing market and problems with
subprime mortgages, which are made to homeowners with weak credit.
Sometimes it’s financial mismanagement. Other times it’s a lost job,
medical issues or another life-changing event.The news isn’t getting
much better. Foreclosure filings nearly doubled nationwide in
September, and new home sales are projected to fall 23 percent this
year.    (ASSOCIATED PRESS)


TECHNOLOGY & SCIENCE

TV losing war with the mouse:
The battle for eyeballs between the home computer and the television
has reached a crucial point, a report by technology giant IBM Corp.
suggests.In study called “The End of Advertising as We Know It,” the
consulting division of IBM surveyed more than 2,400 consumers and 80
advertising firms around the world, and concluded that time spent with
the personal computer is exceeding the number of hours devoted to TV,
particularly among younger viewers.Though audiences aren’t necessarily
using the devices for the same purpose – such as watching shows online
instead of on television – tasks such as social networking, general
Internet surfing and online games are outpacing time spent flipping
channels, the report says.   (Globe & Mail)

Ghosts Of Technologies Past:
Technological ghosts linger for many reasons. Many are embodiments of
our hopes and dreams of the future, and so we let them go only with
bittersweet regret. (Forbes)

Keith Olbermann on waterboarding and torture: Daniel Levin, the Acting Assistant Attorney General, was ordered to right a memo on torture — so as part of his research, he had himself waterboarded (its no surprise he found it was torture). For his courage, he was fired.

Gov’t Commissioned Study Finds P2P Downloaders Buy More Music    

Faulty memories stored differently from true ones: Whether a memory is fact or fiction may depend on where in the brain it is stored, which may explain why people sometimes swear they remember something that never happened, researchers said on Tuesday. "Generally, the memories that we trust are more likely to be correct than the ones we don’t trust," said Roberto Cabeza, a neuroscientist at Duke University in Durham, North Carolina. "However, in some cases we can be completely confident in an event that never happened," said Cabeza, whose study appears in the Journal of Neuroscience. He said memories can come from two sources: a part of the brain called the medial temporal lobe that focuses on the facts and details of a memory, or the frontal parietal network, which involves the overall gist or familiarity of a memory.  (Reuters) 

Skynet military launch is delayed
Wait, wasn’t this the Global Digital Defense Network developed by
Cyberdyne Systems that became self-aware? Gee, I don’t like the sound
of that…   

Why There Aren’t Right-Handed Apes, Or: Handedness and The Evolution of Language   

What Existed Before the Big Bang? The Big Bang theory of the origin of our universe is widely accepted by the physics community. The idea that our universe started out as some infinitesimally small point, which expanded out to what we see today, makes a lot of sense. Except for one small thing. That initial point, called a singularity by physicists, is a physical impossibility. According to the models we have today, the temperature of the universe at that first moment would have had to be infinite, which mathematically makes no sense. Also, the singularity doesn’t do a good job of explaining where all the matter and energy we see today in the universe came from. So, physicists are increasingly starting to look at other branches of physics to see what they can do to replace the singularity with a more reasonable proposition, one which can actually be explained by existing science. (CBC’ s Quirks & Quarks)

New Insights Into How Natural Antioxidants Fight Fat

 



MUSIC BOOKS MOVIES TV FUN!

• EMI is counting on nostalgic boomers to shell out $97 for a Deluxe edition of The Beatles Help!,
which includes all sorts of superfluous crap. They didn’t get me — I
ordered the full digitally restored and newly created 5.1 soundtrack 2 DVD version of Help! for $17 !

Impossible guitar

• How To: The Ultimate Consumerist Guide To Fighting Back   

What should you do if you’re surrounded by angry macaques?

 

That’s all from a weekend of shopping in
the NorthEast, where it now gets dark before 5pm!

~~~

Got a comment, suggestion, link idea? Or do you just have
something on your mind?
The linkfest loves to get email!  If you’ve got something to say,
send email to thebigpicture [AT] optonline [DOT] net.

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What's been said:

Discussions found on the web:
  1. me in OC commented on Nov 11

    “What if the Financials are Worse than they look?”
    You don’t think that we have been lied to, do you?
    Of course it’s worse than it looks!

  2. me in OC commented on Nov 11

    “TECHNOLOGY & SCIENCE
    What Existed Before the Big Bang?”
    I believe in the science of evolution and the possibility of the Big Bang.
    God snapped his fingers, and there was a Big Bang. No pun intended.

  3. justin commented on Nov 11

    I believe that the Big Bang Theory will be disproved once newer knowledge reveals that there are physical properties not yet known to physicist. Right now it is all about the Singularity, but where did all that hydrogen and helium come from in the first place? We are still in the very early stages of knowledge about such things. My only hope is that Mankind can be able to survive long enough.

  4. touche commented on Nov 11

    “What Existed Before the Big Bang?”

    Perhaps there was a super massive black hole and finally it sucked in just enough matter that it broke the camel’s back, the spring unleashed and it hurled big time.

    The creation of the universe is certainly a big mystery and an excuse for many to posit that god did it. I was born a skeptic and could never accept that kind of speculation. Humans aren’t yet capable of solving this mystery, but perhaps we will someday.

  5. David commented on Nov 11

    Barry,
    The dollar is heading on down again! I remember when I was young, that Ronald Reagan said, that our dollar should be worth a dollar!! Ronald Reagan, did not like government’s or men, who devaluates their currency.

    “What is honour? A word. What is in that word? Honour.”
    Shakespeare

  6. me in OC commented on Nov 11

    Justin, All the mater (the hydrogen and helium you talk about), was mater created from energy. Energy transformation.

  7. whipsaw commented on Nov 11

    re: “Impossible Guitar”

    Interesting, but this guy is just ‘tapping’ on a 10 string instrument, using a c-clamp, and some species of metal sound changers on the fretboard that I have never seen before. The nails on his picking hand are acrylics that you could have applied in any nail salon, altho most guitarists would have cut them back and shaped them much more. Even more interesting that there are over 12,000 comments.

    If you want to hear really impossible fingerstyle guitar without any mechanical tricks, google/itunes for Doyle Dykes, Tommy Emmanuel, Christopher Parkening, or chase down one of the various Spaniards. All are excellent.

    ==whipsaw==

  8. riverrat commented on Nov 12

    Some excellent, informative gleanings as usual Barry. Thanks.

    Stiglitz’s take parallels my own.

    But I do recall that while Reagan and Bush Sr also put us deeply into the red and on a seemingly unsustainable socio-economic path, things seemed to turn around in just a few years after Clinton came into office.

    That experience gives me hope that we can also dig out of the messes Bush Jr has either exacerbated or directly caused- if we get better political leadership- but something tells me it may be harder this time around.

    Aging boomers, stabilizing Social Security, the health care crisis, crumbling infrastructure and wholesale offloading of jobs and manufacturing capacity in the name of “free” trade would challenge even competent leaders, which we have not had for many years.

    IMO, our economic challenges are much more systemic and intractable now than after Reagan and Bush Sr had their way with us, because Bush Jr and his cronies have done exactly the opposite of what is needed on so many fronts, as Stiglitz cogently points out.

    I wish I had reasons to be more optimistic. Perhaps some of you more learned people can help me with that.

  9. Douglas Nast commented on Nov 12

    Regarding impossible guitar: The guy is a competent but hardly noteworthy guitarist with some classical training, as evidenced by his posture and technique. What he played on the tape sounded and looked like a warmup exercise. That this is has engendered so much comment shows how few people have been exposed to the musical possibilities of the instrument. Pick out a classical guitar CD at random and you will hear stuff that is to this as Ritholz is to Cramer.

  10. whipsaw commented on Nov 12

    Douglas Nast said:
    The guy is a competent but hardly noteworthy guitarist with some classical training, as evidenced by his posture and technique. What he played on the tape sounded and looked like a warmup exercise. That this is has engendered so much comment shows how few people have been exposed to the musical possibilities of the instrument.

    Exactly. I’ve been playing for over forty years off and on and at least appreciate what is hard to do and what is good to do. When those things converge on occasion, it is magic, but this isn’t one of those times.

    If you want to listen to how it should be done, find some Segovia or Ramirez. Even Parkening fails to compare.

    ==whipsaw==

  11. whipsaw commented on Nov 12

    Douglas Nast said:
    The guy is a competent but hardly noteworthy guitarist with some classical training, as evidenced by his posture and technique. What he played on the tape sounded and looked like a warmup exercise. That this is has engendered so much comment shows how few people have been exposed to the musical possibilities of the instrument.

    Exactly. I’ve been playing for over forty years off and on and at least appreciate what is hard to do and what is good to do. When those things converge on occasion, it is magic, but this isn’t one of those times.

    If you want to listen to how it should be done, find some Segovia or Ramirez. Even Parkening fails to compare.

    ==whipsaw==

  12. Greg0658 commented on Nov 12

    riverrat – The great turn-around mechanism in Clintons years was the power up of foreign factories to western specifications. ie China & India

    I hope that doesn’t backfire. Like to hear more on Hillary’s thoughts on this outta MSM.

  13. Eclectic commented on Nov 14

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    Did yoau know that you;’ve gove t aboyt 1122 oe ao vlovblosgggers listed in th4e bloog rolll?

    WTFfFF??

    Here’s some ideass:

    –Let’s have a virtuuuual picnic. A Bkig-Pic-nicc. We can all goo to somee bolog site and n’thebn come back aaan wriite ane esssseeayy… Wkhyy I likked that lbloger, aandd why he borrs the shit ouutta me.

    -Yu cufd feeture sum bloggers n have’em change colors.

    -Yuou could have ‘emm bfloootin’ around on thesse screenn n’ we cue zappe’m with ourrrrrrr cccuurrsers,n ‘’then winn a pirixxzewe fur the best bloggger.

    -Ucud puttem between postss and bbbboorrrr uss hsitless that 2way.

    Y-sddon’t you jiss takem n’ stick’em whuur tha sunndon[‘t shine!

    Nittte nitee,

    Uyurr ffriend, eccccc9lecTic

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