Barry Ritholtz
How was that for a week? Indices moved briskly higher on lower oil prices as Ernesto -- the hurricane that wasn't -- took some of the sting out of crude prices. Oil flirted with the high 60s, closing Friday afternoon at $70.20.
August turned out to be the best month for market gains since January. The Dow had its highest close since May. The only question is what happens when the A-team returns to its trading turrets. Will they feel performance anxiety and jump in, or will they take advantage of higher prices and hit bids? You'll know the answer in 72 hours or so. Good week in the market, bad weather for the weekend. My sun and sea plans got canceled by the wet, rain-soaked Labor Day weekend. Thanks to the slop, you get this belated and unexpected linkfest! Editor's note: To access some of these stories, registration or a subscription may be required. Please check the individual links for the site's policy.And that's pretty much all from the sloppy, rainy, miserable Northeast, where I will be neither jet-skiing nor parasurfing. I do have an old bottle of Cognac I've been meaning to crack open. ... Now if I can only get the missus to let me spark up a stogie in the house, I'll be set for a few hours.Real Estate and Housing
Housing by the numbers. The secret's out about exotic mortgages. MSNBC notes 'Exotic' mortgages seen losing their allure. BusinessWeek is even blunter: Nightmare Mortgages. Realtors Official Forecasts Decline In Home Prices. (The Wall Street Journal) Bloomberg's Caroline Baum looks at stabilizing prices, rising foreclosures and credit risks: Housing 'Short Sales' Are Latest Sign of Stress. The Association of Risk Professionals, in a dramatic understatement, observes US Housing Market Experiencing Turbulence. The increasingly popular numbered format for real estate columns:- 5 homeownership tax myths. - 4 renovations that kill a home's value. (Any agent will tell you: the Pool!) - 4 Myths about Housing. MarketWatch now has an entire section devoted to real estate. Barron's had a nice roundup of Housing Blogs. (If no Barron's, go here.)
The Federal Reserve and Bernanke
Friday was Ben Bernanke Day in Dillon, S.C.! The Fed chief expects strong U.S. productivity to continue. The pause was a "close call." Some on the Fed are unsure of further moves. Fed Gov. Lacker was the lone dissenter in recent vote to stand pat. He says inflation is too high. Regardless, Friday's nonfarm payroll data certainly put the Fed on hold for a while. Charles Bean, the Bank of England's chief economist, is aghast at the absurd focus on the core rate of inflation by the U.S. Central Bank: The Fed is Wrong on Core Inflation. (If no Financial Times, then go here.)
Markets & Investing
On Thursday, both Richard Suttmeier and I thought the Bond Rally Looks Crowded and Tiring. Chuck Jaffe on the mental exercise of dumping everything and seeing what you would buy again here and now. Bears, Contrarians and the Crowd. What does the Dow Jones Utilities Average's new high mean? (hint: dunno) Here's what some oldtimers are doing:- Wall Street Icon at 105, Avoids U.S. Stocks. - Now that's a permabear! An investor who's been substantially in cash since '86. A Saudi prince opens the kingdom to the public. The Ludwig von Mises Institute on Money and the Stock Market: What is the Relation? For the truly cautious: E*Trade is offering these rates for CDs:5.46% APY on a 6-month CD.Remember: There is aways reinvestment risk on all short-maturity yield products. 7 Deadly Sins of Investing. Reuters Select Screens for Cumulative Performance.
5.50% APY on a 1-year CD.
5.25% APY on a 5-year CD.
The Economy
Friday's nonfarm payroll report was pretty lackluster. The good news is it puts the Fed on hold for at least another two meetings. The bad news is the data beneath the headline number were fugly! I guess the watchword is "slowdown":- Corporate Profit Growth Slows in Step With Economy. (If no WSJ, go here.) - Consumer Confidence and Commodity Weakness Heralding An Economic Slowdown. - Data show economy slowing, not collapsing. Bernanke and Greenspan may not think much of the yield curve, but two economists at the Federal Reserve Bank of New York think it has predictive value: The Yield Curve as a Leading Indicator: Some Practical Issues. (PDF) Why India will overtake China. I've been kvetching about inflation for the past four years. Here are signs it may be slowing and even reversing: Restaurants shave prices, plump menus and Can Stephon Marbury's $15 sneaker revolutionize the sports-shoe business? Five themes for the next five years. The retail sector is not telegraphing very good things to come:- Retailers: Back-to-school sales mediocre. - Mixed Retail Results Breed Unease. (If no WSJ, go here.) - AutoNation chief warns of recession. - Business Spending May Languish, Raising Risk of U.S. Recession. The Odd Recovery: Unemployment Is Low and So Is Employment. You no longer have to wait for the first Friday of each month: Play The Payroll Employment Game.
Politics, Military and Media
Barron's goes postal on a Medicare accounting scam. (If no Barron's, go here.) Donald Rumsfeld gave a controversial address at the American Legion. Rebukes came from all quarters, left and right. The most reasoned was Slate's Four Questions for Rumsfeld. The most stinging came from MSNBC's Keith Olbermann, who questioned Rumsfeld's grasp of history. (Video of Olbermann's response.) Why your capital gains tax rate ain't remotely close to 15%: The Unkindest Tax Cut. (Barron's) The New York Times business columnist Floyd Norris is now blogging.
Tech and Science
Tracking the web with Single Page Aggregators. I'm a fan of PoPURL. I give Dell(DELL Quote - Cramer on DELL - Stock Picks) a lot of grief for all the things they do wrong. Let me praise them when they get something right: My head is a box filled with nothing. Microsoft Grants 37 Million Shares To 900 Execs. That's about $1 billion dollars' worth. Marketwatch columist John Dvorak claims "the real reason Google (GOOG) CEO Eric Schmidt is joining the Apple (AAPL) board is to lay the groundwork for a merger between Apple and Sun Microsystems (SUNW)." Eric Savitz doesn't think so. Neither does Jeff Matthews, who has a hilarious take on Dvorak's ramblings. Yeah, I wish: New York to L.A. in Two Hours. Are tall people smarter? (This study says yes.) Ever wonder what happened to Half.com, Oregon? The Top 10 Best Presentations Ever. What whale-song looks like. The $1,000,000 duck race (a charity event).
Music, Film, Books, TV
Eight years after Napster, the music industry has finally begun to compete with free music downloads: Spiral Frog. Vaughn Trapp sounds like a cross between The Beatles and Crowded House. Here's the latest RIAA nightmare: Google Hacking to Locate MP3s. Download the classics for free: Google public domain books. Bob Dylan's new tune, When the Deal Goes Down. "The Pitchfork Effect": How a tiny Web outfit became the most influential tastemaker on the music scene. A BIOLOGICAL HOMAGE TO MICKEY MOUSE.
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