Daily Investment Interpretations

October 19, 2010

2010-10-19 (Tuesday Night):   My investment advisory service certainly this one right! Stocks fell through the floor today: China, bank worries weigh.  The NASDAQ Composite lapsed 43,71 points (-1.76%) to 2,436.95  The Dow dove 165.07 points (-1.48%) to close at 10,978.62, and the S&P 500 plunged 18.81 points (-1.59%) to end at 1,165.90. Oil dipped to  $79.52 a barrel, while Gold shrank to $1,334. The VIX rose 1.54 to 20.63.
      
    Income Inequality: Too Big to Ignore  This article delineates some of the harmful consequences to an economy when income inequalities reach those seen in the United States, Zimbabwe, and one or two South American countries. In 1976, about 9% of all income went to the top 1% of earners; by 2007, that had risen to 23.5%, while the average, inflation-corrected hourly wage fell 7%.
    "Recent research on psychological well-being has taught us that beyond a certain point, across-the-board spending increases often do little more than raise the bar for what is considered enough. A C.E.O. may think he needs a 30,000-square-foot mansion, for example, just because each of his peers has one. Although they might all be just as happy in more modest dwellings, few would be willing to downsize on their own.
    "The middle-class squeeze has also reduced voters’ willingness to support even basic public services. Rich and poor alike endure crumbling roads, weak bridges, an unreliable rail system, and cargo containers that enter our ports without scrutiny. And many Americans live in the shadow of poorly maintained dams that could collapse at any moment."
     Death of a democracy  This is a "must-read" for everyone. Marketwatch's Brett Arends explains that the recent Supreme Court decision that allows corporations to give without limit to politicians spells the end of democratic government in the United States. This isn't about Democrats vs. Republicans, but about global corporations versus the rest of us. (Bear in mind that MarketWatch is published by the same News Corporation that owns Fox News and the Wall Street Journal... i. e., it's not staffed by liberals.)
     S&P 500 hesitates at the 200-week average 
     Mitt Romney, and why dull is looking good 
     All crime and no punishment on Wall St. This article by David Weidner revisits the lack of any discouragement for Wall Street's leading "banksters", and the fact that this lack of accountability will open the floodgates to pushing the envelope even further. (The worst predators have gotten a slap on the wrist, and been fined 10%-to-20% of their loot.)
     The buck drops here 
     What IBM says about market mood  What IBM says about market mood is that at the moment, the markets are very unforgiving at the moment of glitches that might otherwise be ignored.
     For what it's worth, stocks are up a little tonight.
    I'll be making no moves in the U. S. markets until my investment advisory service says, "Buy"