Weekend Reading: Long Faces

Good Sunday, and welcome to another edition of Weekend Reading. First, a look back at the week that just finished, then a look forward to the week ahead, and finally, a summary of articles and papers are worth reading.

It was an unpleasant week on the markets, with two of the three major U.S. indices falling. The Dow and the S&P 500 lost 1.2% and 1.1%, respectively, while the Nasdaq eked out a 0.2% gain (entirely on the back of a big Monday).

Why the long faces? After all, we started the week thinking happy thoughts, with a general sense that we were close to a bottom that could hold. The Fed's recent creative (don't you love that word?) actions, it was thought, would have investors feeling newly comfortable holding equities. There were even some out there thinking that previously toxic mortgage-backed securities were newly less poisonous.

That feeling, however, went away early in the week, with a drip-drip of bad news making people think that things are not done being bad. No one thing was the culprit, but the combination -- from oil to corporate earnings -- wasn't welcome.

Looking forward to next week, things are likely to be fairly rocky. Odds are we'll see weak monthly jobs numbers, reinforcing the belief that we are already in a recession. It's also mea culpa time for major U.S. companies as they prepare to report second-quarter results.

Turning to economic news, the big show next week will be the aforementioned jobs report, which is scheduled for Friday. The Reuters consensus is for a a 58,000 reduction in the U.S. employee count, which would make for a third straight month of cuts. The econo-nihilists out there are touting the idea that we could see a huge air pocket in this number, so my guess is that the jobs number will have to be truly awful to dent the market badly.

Turning to earnings, it will be the calm (sort of) before the storm. There isn't much to watch next week, but Monsanto(MON - Cramer's Take - Stockpickr) and Best Buy(BBY - Cramer's Take - Stockpickr) are both reporting.

Finally, here are some articles and papers worth reading:

Editor's note: Welcome to Stockpickr's "Barron's Roundup." Each weekend, James Altucher presents Stockpickr portfolios related to articles in the latest issue of Barron's.

• Signs of liquidity starting to emerge in mortgage-backed securities. (IDD)
• Fed actions have defused the rate-reset ARM bomb. (Bloomberg)
• Barron's picks Fiserv(FISV - Cramer's Take - Stockpickr), pans commodities and interviews BlackRock's(BLK - Cramer's Take - Stockpickr) Larry Fink. (Barron's)
• The next bubble: business books about the subprime/credit bubble. (Los Angeles Times)
• Mutual Fund Managers Move Into Cash as Prices Swing Wildly. (Bloomberg/The Washington Post)
• Shortage of supply in the structured finance business? (Risk/Over the Counter)
• Saying that things work out in the economy in the long run is a meaningless sop. (The New York Times)
• Casinos Eye Storage Challenges. (Byte and Switch)
• MIT solar start-up aims to beat coal on price. (EE Times)
• Great interview with ex-Treasury Secretary Paul O'Neill. (The New York Times)
• Where Do Alphas Come From? (SSRN)
• Insider Trading Before Accounting Scandals. (SSRN)
• Cisco(CSCO - Cramer's Take - Stockpickr) cuts expenses, braces for a downturn. (SSRN)
• Big production plans and June debut for Apple's(AAPL - Cramer's Take - Stockpickr) next iPhone. (Fortune)
• Treasury's Plan Would Give Fed Wide New Power. (The New York Times)
• The redemption of Henry Blodget. (BusinessWeek)
• Fascinating, data-rich paper on the securitization of subprime credit. (New York Fed)
• Spending on Alternative Media Jumps 22%. (Advertising Age)
• The bottom in housing is further away than most observers think. (Frontline/Mauldin)
• Corporate bankrupticies are likely to get much worse before they get better. (The Economist)
• The clean energy scam, or at least the ethanol part. (Time)
• Can Howard Schultz turn Starbucks(SBUX - Cramer's Take - Stockpickr) around? (Time)

1 What would best describe your stance heading into the coming week of trading? Bullish Bearish Neutral 2 Which of these sectors do you think is set to move up in the coming week? --Choose One--Aerospace and DefenseAirlinesAutomobilesBeverages and Food ProductsBiotechnologyCommercial BanksComputers and PeripheralsConsumer NondurablesEnergy Equipment & ServicesHMOs and HospitalsHomebuildingInsuranceIntegrated OilInternet, Software ServicesInvestment Bankers and BrokersMediaMultiline RetailPharmaceuticalsPrecious MetalsSemis, Semi EquipmentTelecom EquipmentTobacco and AlcoholWireless CommunicationsUtilities 3 Which of these sectors do you think is set to move down in the coming week? --Choose One--Aerospace and DefenseAirlinesAutomobilesBeverages and Food ProductsBiotechnologyCommercial BanksComputers and PeripheralsConsumer NondurablesEnergy Equipment & ServicesHMOs and HospitalsHomebuildingInsuranceIntegrated OilInternet, Software ServicesInvestment Bankers and BrokersMediaMultiline RetailPharmaceuticalsPrecious MetalsSemis, Semi EquipmentTelecom EquipmentTobacco and AlcoholWireless CommunicationsUtilities View the results without voting