Daily Investment Interpretations

November 17, 2008

2008-11-17:  The stock market fell again today. The NASDAQ dropped 37.8 (-2.29%) to 1,482, the Dow gave up 223.73 points (-2.63%) to close at 8,274, and the S&P 500 parted with 22.54 points (-2.58%)slipping to 851. Oil is at $55.29 a barrel, and gold at $742 an ounce. The VIX ended at about 67.
    Citigroup announced to its employees this morning that it will be laying off another 50,000 employees, bringing its recent layoffs to around 70,000, or 20% of its workforce. Merry Christmas, everyone! J. P. Morgan is mulling thousands of additional job cuts. Here's a Minyanville article about a possible triple bottom for the Dow and the S&P 500: Jeff Saut- A Triple Bottom for Dow, S&P 500?, Here's another article concerning GE: Op-Ed: Could GE Collapse?.  And here's a cautionary advisory from "The Motley Fool": The Biggest Threat to Our Economy. Finally, here's a forecast from Paul Farrell: Paul B. Farrell- We'll be in Great Depression 2 by 2011 -- here are 30 reasons why.
    Yesterday, I pointed out that Dr.Martin Weiss and Mike Larsen were advising that the markets would tend to fall between now and the end of the year as hedge funds sold stocks to cover their periodic redemption requests. The markets fell about 2½ % today. EEV, the Proshares Ultra Inverse Emerging Markets Fund and QID, the Proshares Ultra Inverse NASDAQ 100 Fund rose by 5½ % and 6%, respectively. I'll get interested if the indices broach and close below their 848 close. That will be the signal for a further market shakeout. Of course, the problem is that every seasoned investor will also be tracking this barometer. A break below 840 could lead to another head fake like the trap that was sprung last Thursday, when the S&P dipped to 820 and then soared to end the day at 911. Heigh, ho! Never a dull moment! (I'm reminded of the ancient Chinese curse: "May you live in interesting times.")
    Here are two more comments from (Dr.) Paul Krugman: Fannie Freddie data and After the stimulus.