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Posted
Jul 18 2008, 08:36 AM
by
Todd Harrison
Rating:
I spent the weekend with some of the smartest techies on the planet, guys and gals from all over the world: They drank the Kool-Aid a long time ago. By the time I got back to New York I was ready to get with it and stop living in the Stone Age (I still don’t even have a Facebook page). But if the Internet has so much growth potential and will eventually displace everything including television, then why are the stocks associated with the information highway system limping along at a snail’s pace or have curled up like armadillos? Internet stocks haven’t been world beaters for a long time and right now the Internet Holders is at a 52-week double bottom and vulnerable to the four year low of 44.
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Posted
Jul 17 2008, 12:54 PM
by
Todd Harrison
Even eBay can't bid high enough to beat the lagging economy.
The company's shares dropped 7% yesterday after the company reported that some key indicators of its financial health were in a slump. EBay CEO John Donahoe attributed the poor performance to the weak economy.
Among the telltale signs of slowdown: The value of goods sold on the site only rose 4% between April and June, half the rate increase of the previous three months. Donahoe also said that the weak economy has pushed consumers away from higher priced goods, stagnating eBay's car sales, which had jumped 7% in the first quarter.
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Posted
Jul 16 2008, 10:50 AM
by
Todd Harrison
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Yes, it's here. Welcome to the Depression. No, don't drop whatever it is you're doing. Don't get up. It's not going anywhere. It will wait. It's just going to sit over here in the corner and read a magazine while you do whatever it is you need to do.
A Depression doesn't run hot and fierce like some crazed meth burner. A Depression is methodical, purposeful, patient. It will build a shelter out of tree branches and newspaper, light a small, well-contained campfire and wait you out, brother. While you feed on the empty calories of denial and popcorn, it will quietly gather shards of broken dreams and fashion them into a terrible weapon of blunt force reality.
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Posted
Jul 16 2008, 07:48 AM
by
Todd Harrison
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Given the daily barrage of bad news about the credit crunch, the mortgage crisis and failing banks, you'd think things would be a lot easier for someone who actually wants to take out a simple home loan.
As a matter of fact, just this morning you read an article about two mortgage companies, one with a name that sounds like what they call your grandmother at her retirement community, the other like some up-and-coming DJ. Fannie Mae and Freddie Mac, could that be it? They ran out of money, apparently, which could make it even harder for you to get a mortgage in the future.
Harder? Is that some kind of cruel joke? How could taking out a mortgage be any more painful than it already is?
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Posted
Jul 14 2008, 11:53 AM
by
Todd Harrison
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Hello from New York, where I don't much care how they "fix" Fannie Mae or Freddie Mac, but the related witch hunt to crack down on "rumor mongering" has me frothing at the mouth.
I expect the government to use whatever means they have at their disposal to ensure the smooth operations of the financial markets. You may approve or disapprove of the government behaving in such a manner but you can't deny that there is precedent for such manipulation (see: Long Term Capital, Bob Rubin's October '98 Bear Slaughter, Last August's manipulations, etc. et al).
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Posted
Jul 11 2008, 12:41 PM
by
Todd Harrison
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Without question, the September 1998 low was a good time to be buying stocks... for a trade. Since September, 28, 1998, the S&P 500 has returned 19.5%, excluding dividends. Adding dividends makes the return of stocks over that nearly 10-year span almost competitive with Treasuries, albeit with significantly more risk.
Regardless, given the news this morning that the U.S. government is weighing takeover options for Fannie Mae and Freddie Mac, it is tempting to think we may be finally have reached an important capitulation point in equity markets, especially with many technical indicators and sentiment indicators at negative extremes.
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Posted
Jul 08 2008, 02:38 PM
by
Todd Harrison
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With food costs rising 4% in 2007 -- the highest annual rate since 1990 -- and expected to rise 4.5% to 5.5% more in 2008, some shoppers are making like their 18th-century forebears and opting to grow food themselves. Vegetable gardens are back in vogue, and even chicken coops have suddenly reentered the mainstream lexicon.
During good times, few people even bother to make a grocery budget: Food seems so unquestionably essential. Now, all those buy-one-get-one-free specials are starting to seem like a good idea.
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Posted
Jul 07 2008, 11:00 AM
by
Todd Harrison
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The one thing you learn early on at the racetrack is that when the desperation sets in you can't run around like a lunatic feeling under seats for change and scraping together discarded mutuel tickets looking for a live one somebody accidentally tossed. Hell, at decent tracks they will immediately escort OFF THE PREMISES anyone caught collecting discarded mutuel tickets.
If this seems harsh, put yourself in track management's shoes. From a business standpoint, this makes good sense. They are trying to run a business that turns people into broken, desperate beggars; not host some kind of weird halfway house for people who got that way prematurely.
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Posted
Jul 01 2008, 11:28 AM
by
Todd Harrison
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1. Stocks are firmly in a downtrend.
The S&P 500 is down roughly 20% from the market peak on October 11, 2007.
2. Corporate spreads are rapidly widening.
Investment grade bonds yielded as little as 0.30% more than U.S. Treasuries did back in 2003 - but are now as much as 2.30% above U.S. Treasury rates.
3. Everyone I know is saying “All is well, buy America.”
The crowd is usually wrong at extremes.
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Posted
Jun 30 2008, 03:59 PM
by
Charley Blaine
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Chrysler exists because Lee Iacocca bet the company on the minivan. Now, thanks to the oil crisis, the minivan looks like it could be on its last legs.
One of the company's two minivan assembly plants will be shut indefinitely on Oct. 31, Chrysler said today. The problem is that families -- the target market for minivans -- have been particularly affected by rising gas and food prices, falling home values and more difficulty in borrowing money.
It's a humiliating development for Chrysler, which spent $1.4 billion on the redesign of its two industry-leading minivans, the Chrysler Town & Country and Dodge Grand Caravan. And then saw sales go, well, nowhere.
"Everything that a family needs is more expensive right now, and so the last thing they're looking at is, 'Do they need to replace their Honda Odyssey?'" said Rebecca Lindland, an auto analyst for Global Insight, the economic consulting firm
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