That Was The Week That Was-3rd Week January

 

Get Your Reservation In for Client Breakfast Meeting. The days are flying by and before you know it Spring will be here and we’ll be dusting off golf clubs and tennis rackets. First there are things you have to know in 2014 about your money, the markets and what you can expect. Call or write me for your reservation. In addition to the economy I’ll be talking about how your beneficiaries may best manage your gifts. February 8th 8:30-10:00 AM at Sycamore Golf Course. Call or email!

 

 The week started lousy with Goldman Sachs saying the Market was expensive & 180 points on the Dow went pfhtttt. But that wasn’t the bad news! The horrible, really awful news (sob!) was that an American Institution was being sold to the Japanese! I am talking about the parent company that makes Jim Beam bourbon, and also distills sipping whisky Makers Mark, being sold oak barrel, charcoal and all to the Japanese firm Suntory. Yes, there was a 25% premium paid for the company, but that’s not the issue. Selling the spirits maker is like selling the Washington Monument or the Grand Canyon. This is an iconic American company. Bourbon is really America’s liquor. The Russians have vodka, the Japanese Saki, and the French have Champagne and cognac. But for the U.S. to sell BEAM to the Japanese is like selling them the company that makes Titleist golf balls…..oh, yeah, we did that, too, a few years back.

Off the record - The Street listens to Goldman but doesn’t believe Goldman. The rumor on GS is whatever the company downgrades is something they have their eye on and will eventually buy once the price comes to where they want it.  

WSJ and CNBC announced. Google to Buy Nest Labs for $3.2 Billion. Nest labs is run by several x-Apple execs and their products are sold in Apple retail stores and on-line Apple. The company makes smart thermostats and smoke alarms. Pricey- I may add. But Google wants the execs themselves and their knowledge of getting into the homes of consumers through smart utility products. Current Nest has only 1% of American homes as clients. The CEO of Nest Labs was early designer of the iPod. 

  Alex Rodriguez is frosted over baseball’s arbitrator’s decision to bench him for a year, and is taking his case to a federal court for appeal. Alex and his lawyers don’t seem to grasp the arbitration process…Arbitration  doesn’t have anything to do with the law and who’s right or wrong. It’s all about what the Arbitrator ‘feels’ is right. It’s not about English law but rather Medieval Justice. The law has absolutely nothing to do with it. You can use and argue it in an arbitration but that doesn’t mean it carries any weight.  Many credit card companies now state that if you want to sue them that you have to use the arbitration process. Read the small print on those little updates to your credit card agreement they send you in the mail. As for A-Rod, see ya next year!

Tuesday Markets Bounced Back over 100 points! Expect more days and weeks like this in 2014. Probably more trading markets like 2012 than 2013. And another 100+ point day Wednesday as gold & oil fell.

Michael Kahn in 1-16s ‘Getting Technical’ in Barrons.com wrote, ‘Bulls Still Rule.’ How far the next leg up on the Dow is anyone’s guess, according to Kahn but the charts are still bullish.

Big Investors like BlackRock and Pioneer in MarketWatch.com report 1-16 are betting against Bond Giant Bill Gross.

Not since the 1930s has the U.S.A. seen such a protracted downturn as we have experienced since 2008, reported Harvard University economists Carmen Reinhart and Kenneth Rogoff. ‘Still the USA can count itself lucky, with the exception of Germany, no major economy in Europe has returned to its per capita GDP peak.’ Many economists still believe the U.S. economy remains well below its production capacity- which is really good news. MarketWatch 1-16

Japan has 10 firms that specialize in ‘Hire a Friend’. These firms charge the lonely for companionship. I am trying to think of something clever but just thinking about it is sad.

Not All Banks are Equal- In the Big Bank Too Big To Fail Department: Citi didn’t make numbers, JPM ditto, BAC did-barely and Goldman did it but not like Goldman of old and so Wells rounds the corner a big winner. material compiled from various sources through the week. Markets down Thursday.

Marissa giveth and Marissa taketh. The CEO of Yahoo hired former high ranking Google person Henrique De Castro as COO back in October. Fired him in January before the poor soul could get his Bentley detailed and his jeans pressed. Reasons: He was divisive and didn’t ‘move’ fast enough to suit the CEO. And, according to Ad Week, 1-16-2014, Henrique had trouble building a team. Off he goes and the Street, according to MarketWatch applauded and was concerned at the same time. Concerned about earnings and happy that the boss acted fast.  Don’t feel bad for Henrique as a settlement package valued at $60 million is a parting gift.

According to Zack’s.com Profit from the Pro’s Goldman had it wrong when the set about explaining how the markets are overvalued. According to Zack’s. com the markets are fairly valued moving toward fully valued. And, according to Zack’s the Bull Market is still in place. 1/17 If the 10-year moves to 3.5% then there will be some reaction to the equities. 

Finally- Friday Dow up (but not an up that you’d be proud to talk about or even show off) Other indices off with gold and oil up. Thomas Kee, of Dow Jones, on 1-16 reported that on price alone the Dow looks vulnerable. He warns of a possible modest pullback. 

Material and Information gathered from sources considered reliable and include financial as well as general information print and internet resources.

Questions call Paul @ 586 295 0430 or write him at pstanley@westminsterfinancial.com Share this blog with someone who cares about their money.

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