Return of the Linkfest

Sunday, July 16, 2006 | 05:27 PM

Yes, after a vacation induced hiatus (the missus insisted), the linkfest has returned!

I put the l-fest together as the workweek progresses; All week, I read through a lot of data and analysis, including MSMedia items. Each day, I pull aside (virtually) 4 or 5 of the most interesting items each day. By Friday, I have a ton-o-stuff.

Let's not delay this any further:

• Earnings season began rather inauspiciously: Alcoa, 3M, EMC, Lucent, AMD. While the spin has been these are all company specific issues, after 14 Qs of double digit growth, its smells alot like earnings are softening;

Mideast Strife Wounds Stocks: That's been the major headline this week, but it is somewhat overstated. Why? From the June lows til last week, the SPX rallied 5% -- thats 60% annualized, and that's unsustainable. Between that and the poor earnings kickoff, we were due for a correction, anyway. The mideast strife makes for as good an excuse as any.

•  Russell explains What War Means for your Wealth;

• Oil futures did move towards $80, so the situation there is not completely irrelevant. But as Howard Simons pointed out, last we checked, there's no Oil in Gaza or Lebanon. With Iran as the likely source behind the Hamas and Hezbollah attacks, an Israel-Iran war becomes a possibility -- and that would certainly be a major issue for energy markets and the equities. As this goes on, its becoming clearer that China and Russia are the beneficiaries of our incursion in Iraq. The US has very little leverage to deal with abundant global crises. And you know things have gotten really weird when Patrick Buchanan sounds increasingly reasonable on foreign affairs.

• Energy is the fulcrum here, and these few items stood out from the fray:

-Study: Ethanol won't solve energy problems

-IEA Sees Oil Supply Growth Exceeding Demand in '07

-Few US Workers Who Could Telecommute Do So 

-A disruption in Iranian oil exports looks unlikely

• OK, enough overseas news: Option issues refuse to go away: Spring loaded options were the prior scandal; Today, the WSJ discusses the newest option related scandal: Post 9/11 options. (if no WSJ, go here). Its a disheartening tale of greed and unamerican behavior from a large group of corporate assclowns.  Robert J. Samuelson is almost as blunt: He writes about the Delinquency Of the CEOs;

• The Fortune Global 500;

• One thing that really stood out this week were all the budget deficit/savings related issues. It all started with a surprisingly upbeat NYT article on the deficit: Surprising Jump in Tax Revenues Is Curbing Deficit.

A few discerning deficit watchers noted the NYT had been punk'd. The White House has pulled a page from Wall Street and is playing the game of beat by a penny. Budget Watcher extraordinaire Stan Collender calls this an annual game:  Each year, the White House overstates expected deficits, and then manages to produce an "upside surprise." He details this in  Deficit Reduction: Stop Me If You've Heard This One.

The L.A. Times is even more succinct: In Deficit's Good News Less Than Meets the Eye Joel Havemann wrote:

"This will be the third year in a row that the administration put forth relatively gloomy deficit forecasts early on, only to announce months later that things had turned out better than expected. To some skeptics, it's beginning to look like an economic version of the old "expectations" game."

The last word on Deficits and tax cuts came via the WSJ's Washington Wire. Dasvid Wessel noted that the claim that "Tax Cuts Pay for Themselves" is belied by the administration's own budget:  The answer is No, "if you read the fine print in the new White House midsession review of budget trends."

• The Stock Trader's Almanac laid out the Bull's case last week.    

• It is not only the Federal Government (see the deficit discussion above) who's spending exceeds its income -- its the American family also. The Kansas City Star -- about as heartland as you can get -- is warning that our Saving trend is troubling; Paul Merriman goes even further, and claims that America's savings hoax exposed.

• The good doctor inquires: So you want to write a market blog?

• Laurence J. Kotlikoff of the St. Louis Fed asks Is the United States Bankrupt? The answer will surprise you.

• One of the reasons I've been so negative on big cap tech is history: Here's some data on Why Former Market Leaders No Longer Lead;

• I found this version of Dante's Economic Inferno amusing: Henry Paulson and the Five Circles of Economic Hell

• The NFP data last week was a huge disappointment. That oughta teach the dismal set not to rely on the ADP data. Anytime we get a major shortfall, it always brings out the intellectually bankrupt who insist we should rely on the Household Survey. As the Federal Reserve, the BLS and Alan Greenspan noted, you shouldn't. Merrill Lynch's David Rosenberg calls that ploy "a hoax of gargantuan variety." Dan Gross calls it "The Job Wars";

Forget the various surveys for a minute, and look at this chart from HVB Group; Temporary Employment and the Help Wanted Index both point to a slowing -- not tightening -- labor market. Something perhaps that the Fed might want to note.

• Rev Shark and I had an interesting discussion on just what is Capitulation.

INVESTING: All that above stuff and we haven't even gotten to anything investing specific. Here's a quick round up:

-How the Market Confounds Human Nature

-Online Stock Trades Get Even Cheaper

-Ignore Inverted/Flat Yield Curve at Your Own Risk

-Stagflation: A new peril for stocks (its really more of "stagflation lite")

-Corporate Debt Begins to Worry Bond Investors

-There's No Such Thing as Idle Cash on the Sidelines

-Mark Cuban's Share Sleuth has launched

-S.E.C. Looks to Cut Costs of Meeting Audit Rule

• I've discussed Real Estate enough that you should be well familiar with the slow motion slow down idea. Now high prices are crimping affordability; But what if you have to sell? Here's two pieces of good advice:

-Surviving a Real-Estate Slowdown

-Four Steps to Selling Your Home for Top Dollar

• There was Tech and Science news aplenty the past week:

-It turns out that Van Gogh painted perfect turbulence in Starry Night

-On the one hand, we have The MySpace Bubble; On the other hand, MySpace Moves Into #1 Position for all Internet Sites

-SOBs: Spyware developers net huge profits, outrage

-Red flags raised over eBay as rival Google nips at its heels

-What's the Universe look like in 10 Dimensions: This

-Go Ask Alice: Mushroom Drug Is Studied Anew

-Of course, what would a tech round up be without an Apple mention? While the press naively repeats with Microsoft's vaporware announcements, Apple is Keeping the iPod Humming Along;  Meanwhile, Marketwatch asks: Can GM learn something from Apple (hint: it involves design)

On to Media and Content:

• I am enjoying the free streaming videos from Amazon, such as this John Fogerty concert.

• Not surprisingly, a Federal Judge ruled against film sanitizers;

• Meanwhile, network TV continues to fade (must be all that downloading)

• Interesting data set on the publishing industry;

• I am really enjoying the book The Long Tail; I couldn't get a date for Wired's book party in Tribeca, so I was forced to spend the evening chatting with David Byrne (so cool!)

• Speaking of World music (nice segue), my favorite bboxed set this year has to be This is Reggae Music. It is simply awesome.

• I loved this year's World Cup -- even the flawed ending. My favorite aspect of the head butting incident? This little piece of Chirac-Zidane photoshopping. (See also The Rednecks of Britain)

• Speaking of photoshopping: check out Pop Culture Monsters

   That's all from sunny NY -- where the rains seems to have finally stopped, a nice weekend is in store, and the beach beckons.  Enjoy the weekend.

Sunday, July 16, 2006 | 05:27 PM | Permalink | Comments (10) | TrackBack (0)
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Comments

Barry: Love the linkfest. Thanks.

You experimented with "open" any-topic comments a while back. I liked that. Perhaps you could do it every saturday? As a place for us to discuss the upcoming investing week?

For example, I would like to hear the thoughts of the readers here about this weekend's fighting in the ME and upcoming week of data in US.

Posted by: Bearish | Jul 16, 2006 5:36:57 PM

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