TSC Weekender: Rubin Rules, Index Initiates and a Rompin' Rally

Plus, our quiz this week tests your Net-company knowledge.
Author:
Publish date:

Friday, Wall Streeters climbed out on their ledges and peered at the sidewalk far below in homage to the 70th anniversary of the big crash. Oh,

just kidding

. But professional men and women did dangle their feet from window sills and catapult reams of paper from windows during the noontime New York Yankees ticker-tape parade celebrating the World Series win. ( Be a part of it with our TSCam shots.) This weekend, don't miss our review of Michael Lewis' The New New Thing, two fun quizzes and your favorite columnists. Jump on in.

Rubin, Rubin

Three's company at

Citigroup

(C) - Get Report

starting this week. Apparently the bigwigs at the corporation think that having two CEOs is good but having three chairmen is even better. Tuesday Citigroup named

Robert Rubin

chairman of its executive committee and appointed him co-chairman -- serving alongside

Sandy Weill

and

John Reed

. The

Goldman Sachs

alum resigned as

Treasury

secretary in May of this year. His duties at Citigroup are still undisclosed.

With Reed and Weill serving as co-CEOs (some say because neither could stand being second-dog) and both drawing praise in their roles, some wonder if that leaves the dashing former Treasury secretary as a polished figurehead for the sprawling company. Others say

Rubin will help smooth the relationship between Reed and Weill. Everyone agrees, however, that by landing the 61-year-old commonly credited with creating the economic boom, Citigroup has scored big. And not in that

Jack Tripper

way.

How Now Dow Jones?

It seems that even an old

Dow

can learn new tricks. Starting Monday, four stalwarts in the 30-stock index will be

replaced by initiates

Microsoft

(MSFT) - Get Report

,

Intel

(INTC) - Get Report

,

Home Depot

(HD) - Get Report

and

SBC Communications

(SBC)

. The unhappy ousted stocks include

Chevron

(CHV)

,

Goodyear

(GT) - Get Report

,

Sears

(S) - Get Report

and

Union Carbide

(UK)

(all four fell when the news broke on Tuesday). The official word from John Prestbo, editor at the Dow Jones indices and markets editor of

The Wall Street Journal

is that the reconstitution "streamlines" the DJIA along "sectoral" lines -- whatever that means.

Looks to us like the Dowager is getting a

wee bit hip in her old age -- adding tech bellwethers while losing some sleepy manufacturing and energy names. But effects of the change will likely only be

cosmetic, given the fact that most institutional money ignores the Dow, preferring instead to track the

S&P 500

. Of course, mutual funds based on the popular Dogs of the Dow investing strategy are likely in for a bit of a

rough ride, given the lower dividends of the new stocks.

And a Rally Sallies Forth

The end of this notoriously cursed month brought good news and then ... more good news to Wall Street. Thumbing its nose at

history, the market soared on both Thursday and Friday, largely in response to economic reports that indicated the U.S. economy is growing at a nice clip without indications of inflationary distress.

GDP

increased at a rate of 4.8%, while the

Employment Cost Index

rose a mere 0.8% during the third quarter.

GDP Report: Join the discussion on

TSC

Message Boards.

Drunk on the nice numbers, the Dow

leapt 227.64 by the final bell on Thursday, while Friday saw the

Nasdaq

stagger to a record close. A

speech by our fearless

Fed

leader on Thursday night also left a generally favorable impression (of course,

not everyone was so easily impressed).

Altogether, a

thrilling end to a fearful month: all treats, no tricks.

Staff reporter Thomas Lepri contributed to this story.