Tuesday Musings – First Week In May of the Week That Was

 

• A day by day account of the week that was. 
• Monday markets shook off Greek concerns and embraced the good old America amnesiac consumer. Yes,dear reader, The Dow climbed 143 points as auto sales, consumer spending and manufacturing activity were up. A Commerce Department report showed that Americans cut savings and increased spending in March. You’ll never go broke not following the American consumer. They are the only peoples that are able to move global economies. Gold, the dollar and oil all up and Treasuries (watch this) down moving yields up.
• From the Department of ‘What The Hell Were You Thinking’, Wal-Mart, about as an American company as egg foo yung settles allegations of dumping hazardous waste at stores throughout California. Everything from pouring bleach down drains to disposing pesticides and other chemicals where kids were playing were the charges settled. Next on the list that big box store, Tar-get, for similar violations.  Tell me it isn’t so.
• Car sales improved for all three auto manufacturers.
• US Airlines made $7.8 billion in fees….that’s a lot of peanuts.
• GMAC swings to profit. Remember GMAC? Talking heads eighteen months past were prematurely eulogizing the lender and some even confused it with General Motors. We ignored the nay sayers sold and bought the bonds as fast as we could and got double digit returns. The real gutsy plays were buying the bonds out five years for a clear double. When I’m old and gray that’s the good old days I’m going to remember.
• Sell in May and come back in November? Not this year. History says yes as money managers love to window dress for their annual bonuses but lots of make-up to do this year and next.
• Steel industry hiring as autos, appliances and energy increase demand.
• Mamma Mia it was a selloff! The worst in 3 months as fears that 100 billion Euros may not be enough to stabilize Greece, and worries that it could be contagious to Spain and Portugal, sank the US and European markets Tuesday. Lazard stepped in as it was hired by Greece for financial advice and not for restructuring. Lazard helped restructure debt Ecuador, Argentina and Ivory Coast. The problem is that  with the rioting over wage freezes the Greek populace have not accepted the need for fiscal restraint. According to news reports Spain and Portugal do not seem to have those constraints.  
• Buffett still ticked that Kraft bought Cadbury. $8 billion invested and CEO ignores him.
• Bill Gross of PIMCO, or PIMCO’s Bill Gross, called the big 3 ratings agencies ‘timid & slow’. He’s referring to S&P, Moody’s and Fitch, also known as the 3 stooges for their exemplary work grading bonds for the major investment bank factories. Sigh.
• Wednesday’s market slide continued as Greek citizens rioted, called their government crooks and refused to accept austerity plans. Dow off 60 along with other indices. Oil less than $80 and gold slightly up. Euro falls to the dollar less than 130.
• American CEO’s more positive today then they were in January. Okay, slightly more positive but it’s still good news  & I’m trying to squeeze in as much good stuff as I can this week.
• Holey Moley, Superman, 1,000 point dive?! It was like  I was driving along, minding my own business, and a tree jumped in front of me. Thursday markets touchy over Greece complicated matters when an alleged Citi trader punched in waay too many zeros when selling shares of P&G precipitating a market collapse. NYSE did the smart thing and halted trading for 90 secs on those issues allowing people to think before making trades. Dow off 345. Trades simply automatically rerouted. 
• On Friday morn buying opportunities to take advantage of. Markets expected to still be iffy.  Investors sending strong message to politicians to clean up their act, stop spending, budget, conservative measures. Seems voters can’t do it so traders are pushing for change. Markets off over 130 points. All indices off. Oil down and gold slightly up for the week.
• Any other day except Friday and the markets would have soared with the jobs report. It was stunning, across all sectors and the best in four years. Yes, there was an uptick in the unemployment percentage as the hardcore unemployed decided to join the line of those looking for work.
• There should be a law that does not allow NPR broadcaster to report sport’s news.
• Finally, four more banks shuttered Friday by FDIC.

If you have questions call Paul at 877 783 7080 or write him at pstanley@westminsterfinancial.com. Share this blog with someone who cares about their money.