Daily Investment Interpretations

November 3, 2008

2008-11-3:  The markets managed to finish the last day before Election Day largely unchanged in spite of the fact that "The wheels have come off auto spending." Ford sales are down 30%, G sales are down 45%, and even mighty Toyota is 23% underwater. In addition, the Institute for Supply Management reported that U. S. industrial production is down at 1982-recession levels.
    The NASDAQ eked out a gain of 5.38 points (0.31%) to reach 1,726.33, the Dow fell  points 5.18  (0.06%) to close at , and the S&P dropped points 2.45 (0.25%) to depart at 966.30. Oil fell $3.90 a barrel to close at $64.30 while gold added $8.60 an ounce to reach $726.80. The VIX ended at about 54.
    Meanwhile, Hugh Johnson says the bottom is in: Bottom is in, says Hugh Johnson but don't buy stocks just yet  
    The stock market's resistance to bad news could reside in the fact that the credit markets seem to be thawing--but... Fed Says Banks Tighten Loan Standards Most on Record (Update2). This comes as no surprise, with consumers and companies retrenching with breathtaking rapidity. Ford announced today that its sales have slumped 30%, while GM advised that its sales are off 45%. At those rates, these corporations would only be able to support a fraction of their present workforces. And further layoffs imply further sales shortfalls. (Most people can get by for a while without buying a new car.) Long-lived, big-ticket items will probably be hit the hardest in the months (years?) ahead.