Daily Investment Interpretations

November 8, 2011

2011-11-8: (Tuesday Night): U. S. stock market indices ended 1+ % higher again today, after falling and then rising again: Stocks hit intraday heights, Stocks Gain as Berlusconi Agrees to Resign. The NASDAQ Composite vaulted 32.24 points (1.2%) to close at 2,727.49. The Dow jumped 101.79 points (0.84%) to 12,178.18; the S&P 500 advanced 14.8  points (1.17%) to settle at 1,275.92. Oil rose to 97.00; gold slipped to 1,787: Gold and the Dot.coms: Comparing the Bubbles, Gold futures gain but fail to close above $1,800. The VIX dropped 2.37 points to 27.48.
    After winning a confidence vote today, Italy's Prime Minister, Silvio Berlusconi, Berlusconi plans to resign: reports, Not so dolce vita (video). Want Berlusconi out? Be careful what you wish for. This article says, "Italian premier may be a slippery character, but the alternative could mean a drying up of tax receipts, capital flight, and a run on banks, writes Fil Zucchi." Matthew Lynn suggests that it makes no difference who's in charge of Italy anymore: it's on skids: Arrivederci, Italia. Is 7% Italy's tipping point? This article asks whether a ½ % rise in 10-year bond interest rates will be enough to trigger a Grecian-style meltdown. To quote from the article: “If rates IT:10YR_ITA get above 7%, 'the markets will perceive that the story for Italy will become like the story for Greece. There has to be some change there and the problem is that unlike Greece, Italy is huge. There’s no real fix for Italy.'  Barach continued: 'Greece is to the EU like Chicago is to the United States. Italy is probably like California and New York combined. The EU has to stop dithering and take some decisive action, but it looks like they just can’t get their act together. By the time they decide to make a decision it might be too late to put out the fire.'”

    Another article presents Draghi as European Central Bank captive: "Mario Draghi faces a desperate dilemma, writes David Callaway."   
    Mark Hulbert says there is Good news, and bad, from insiders.
    On the other hand, Big Money is looking more bullish
    Irwin Kellner writes: You cannot push on a string, and : "'Nearly everyone who was bribed by $8,000 federal tax credit to buy a house in 2009–10 has lost money', writes Brett Arends": The great $26 billion real estate swindle.
    Minyanville asks: Is this the recovery?

    Paul Farrell' article-du-jour is: Financial literacy is a big, fat Wall Street lie
    Michael Ashbaugh's weekly technical analysis is entitled: Michael Ashbaugh: S&P in view of technical test.

    State of the Markets articles include:
    Technical Talk: It's a Consolidation Phase - Play Accordingly    
    Slow Growth U.S., Steady Growth Asia, No Growth Europe?  
    Is Italy Really The Key?  
    Lucas Papademos To Be Named New Greek Prime Minister  
    McDonald's Global Sales Above Expectations  
    Italy's Berlusconi Wins Vote But Loses Majority; Resignation Calls Continue  
    Italy's Berlusconi Says To Resign Following New Budget Law  
    Market futures are neutral again tonight.