Posted by
BPeters on Friday, June 27, 2008 1:53:39 PM
Seen a headline via Drudge, all it said was 'Fear'. Seems those in the stock market have put most of their eggs in one basket if the cost of oil is making them so nervous with their money, they have to sell, sell, sell. Good time to break out Eddie Murphury/Dan Ackryd's, Trading Places and just laugh it off. The sun will set today, rise tomorrow. God hasn't given His trumphet warnings that the time has come....yet. Though if I were in California...I'd move.
This is a decently written story, seems a 'reporter' actually did their job:
Wall Street loses more ground as oil rises; personal spending, incomes jump
-- Stocks slumped again Friday after a sharp dive in the previous session, with investors anxious about a new oil price record and dubious that personal income and spending will remain resilient.
The Commerce Department said spending rose 0.8 percent in May, as taxpayers started receiving their stimulus checks. The increase was higher than the 0.7 percent economists predicted. The report also said personal incomes surged 1.9 percent -- significantly more than anticipated. After taxes, incomes surged 5.7 percent, the largest amount in 33 years.
But the data provided only a bit of solace to investors nervous about the average consumer struggling with rising prices, falling home values and the shaky job market.
"They're saying that's great, but what's going to happen in July and August, when we don't have the help from the stimulus checks?" said Hugh Johnson, chairman and chief investment officer of Johnson Illington Advisors.
With many commodities on a seemingly unstoppable incline, Wall Street remains concerned they will slam consumers with not only elevated costs for energy and food, but also for other goods if cash-strapped companies decide to pass along the rising costs. Early Friday, crude was up more than $1 above $141 a barrel on the New York Mercantile Exchange, after briefly surpassing $142 in pre-market trading. Corn and soybean prices have also been hitting new all-time highs.
"If you're looking for problems that face investors, that face the U.S. economy, they're everywhere," Johnson said, pointing also to still-tight credit conditions for the nation's banks.
The major indexes changed direction several times in the first hour of trading, and then turned lower by late morning trading. The Dow Jones industrial average fell 78.25, or 0.68 percent, at 11,375.17, sinking to levels not seen since September 2006 and compounding Thursday's nearly 360-point skid.
Broader stock indicators also fell. The Standard & Poor's 500 index fell 3.93, or 0.31 percent, to 1,279.22, and the Nasdaq composite index fell 15.14, or 0.65 percent, to 2,306.23.
Bond prices edged higher. The yield on the benchmark 10-year Treasury note, which tends to move opposite its price, was at 3.99 percent, down from 4.03 percent late Thursday. The dollar was lower against other major currencies, while gold prices rose.
Thursday's drop came on a combination of worries about oil prices and the financial, automotive and technology sectors. General Motors Corp. shares dropped to their lowest level in more than three decades.
GM shares rose 3 cents to $11.40 on Friday.
In other economic news, the University of Michigan's June index of consumer sentiment came in at 56.4, a bit lower than its reading in May and slightly below the average analyst estimate.
Also Friday, a Lehman Brothers analyst lifted his prediction of Merrill Lynch & Co.'s asset markdowns in the second quarter. His write-down estimate rose to $5.4 billion from $3 billion. On Thursday, a Goldman Sachs analyst forecast a $4.2 billion write-down at Merrill and a nearly $9 billion write-down at Citigroup Inc.
Merrill shares slipped 11 cents to $32.90, and Citigroup shares fell 28 cents to $17.39.
Keeping investors nervous about the tech sector, Palm Inc. posted a worse-than-expected quarterly loss after the market closed Thursday. The smart phone maker said sales of Treo phones were slowing.
Palm Inc. shares fell 52 cents, or 8 percent, to $6.02.
Another smart phone maker, Research In Motion Ltd., extended its sharp decline from Thursday, when it issued a downbeat forecast. The BlackBerry maker fell $4.96, or 4 percent, to $118.50.
The Russell 2000 index of smaller companies fell 4.36, or 0.62 percent, to 694.06.
Declining issues narrowly outnumbered advancers on the New York Stock Exchange, where volume came to 376.9 million shares.
Overseas, Japan's Nikkei stock average fell 2.01 percent after Wall Street's tumble. In afternoon trading, Britain's FTSE 100 fell 0.30
percent, Germany's DAX index fell 0.09 percent, and France's CAC-40 lost 0.30 percent.
First off, Americans need to invest into their fellow Ameicans. Those who are making tremendous strides in making the US a Nation independent of foreign oil. Invest in water. Invest in storing, moving, and processing water. Invest in the companies, the Mom & Pop that is building their proven prototypes. Invest in America. The large mega Corporations need to show how they are helping 'Americans' and not just the Corporate Board pocketbooks. This Nation is at a huge and critical crossroad in it's history. Investing smartly will be one of the best ways to ensure continued growth and success.
I see the small independents still making advances in this Nation. The small independent individual, small company, they are 'growing' and their jobs are continuing. It's the 'large' overextended corporations that are floundering. Two examples: one guy I know has a embroidering/print shop for clothes. He's backlogged now 25 orders of 20 - 300 items per customer. He's been this way for the past four months, and he continues to grow. Another guy has a 'pump' business. He has more jobs than he can handle, his suppliers are the only thing slowing him down. Another small company, that has 'petroleum' auto products....get a weekly delivery (note I had to stop there and do 'work' since I'm doing this during my breaks today at work). One of the sales/supply drivers has been back twice to get resupplied. That company is doing well. Helps to have good products too.
I know a few sales people that have been nothing but busy. So where's the economy crashing and why is Wall Street panicking?? Over invested in oil maybe??? Over invested in giant auto makers??
Invest in what made this Nation great, small business, and the return will beneficial for all.