The market certainly showed it wasn’t ready to swallow Thanksgiving week's turkey-like performance and soared almost 100 S&P points and around 800 Dow points. The question for traders is whether or not all this gorging will lead to some indigestion to come or a merry ride into Christmas and New Year’s.
We certainly do not have the answer but can at least review some of the notable quotes and events which marked last week’s activity. So let’s get started.
“The move by China to cut their reserve requirement overshadows all the other European news this week and really is what triggered the upside move. Psychology at many times trumps economic reality and we could start to see some real panic on the side of those who are under-invested. It's now risk on, people are going to have to buy risk through the end of the year." -- well-known hedge fund manager and market “guru” Dennis Gartman in an interview this week
“Trading this market is riskier than being Kim Kardashian’s next husband.” --financial website blogger
“Corporate profits are at record highs and the U.S. economy is stronger than we think. If we can survive the European situation we may see an old-fashioned stock market rally while we also—surprise-- see a dollar rally. The real issue is that 50% of U.S. companies’ profits’ are dependent on foreign markets staying out of deep recession.” --Larry Kudlow on this weekend’s radio program
“I think in the interest of General Motors, the industry, and the electrification of the car, it’s best to get it right now than when you have — instead of 6,000 — 60,000 or 600,000 cars on the road.” --GM CEO Dan Akerson on possible recalls and even buybacks of the Chevy Volt after NHTSA testing and its “sudden fire” crash test results. (Ironically, the same day, Consumer Reports magazine named Chevy Volt owners the "most-satisfied" vehicle owners in the United States, as a whopping 93 percent said they would buy one again.)
“The award for most outlandish Cyber Monday deal goes to homebuilder Dominion Homes of Kentucky and Ohio, which offered up to $80,000 off some new homes if the buyer initiated the buying process on Monday.” --Time Magazine (By most estimates the Black Friday/Cyber Monday period was a huge success, with retail sales traffic estimated at +16% and online transactions up over 30%. Many analysts, however, still question the actual profitability of the deals being offered and whether or not futures sales are just being shifted to earlier in the shopping season).
“Marathon runners often say that a marathon gets especially tough and strenuous after about 35 kilometers (22 miles). But they also say you can last the whole course if you’re aware of the magnitude of the task from the start.” --German Chancellor Angela Merkel in a speech this week on solving the Eurozone crisis
“82 year-old Arnold Palmer recorded his 20th career hole-in-one recently. It was reported that he bought rounds of Metamucil for the house at the 19th hole.” --AP sports wire quoting a newspaper columnist
“How many more unemployed anthropologists do we need? I want to spend our tax dollars helping students get science, technology, engineering, and math degrees so our kids can get out of school and get a job.” --Florida Governor Rick Scott in an interview
“A decrease in VIX call buying suggests the bears are loosening their grip on equities.” --market analyst
“IPO investors got all hot-and-bothered this week following rumors Facebook may file its IPO with the SEC as soon as next month, with a target to hit the market between April to June of 2012.” --Street Insider (even though FaceBook is considered in a class of its own, the recent stock performance of “hot IPO’s” such as Groupon, LinkedIn, Pandora, Zillow and Yandex off early post-IPO prices is of some concern to many IPO watchers)
"Now that AMR Corporation, parent company of American Airlines and American Eagle, has filed for Chapter 11 bankruptcy protection, should you cash in your tickets and use up those frequent flier points?" --Forbes Magazine poses this question and their answer is no, as both carriers are expected to be operating ‘normally’ while in bankruptcy proceedings
"The generally positive commentary on the most recent jobs report by Alan Krueger, chairman of the president’s Council of Economic Advisers, didn’t hide the fact that more than half the drop in the unemployment rate came from people giving up and leaving the labor force — call it the Despair Index". –New York Times
“QUABITY FIRST” --slogan on reams of paper now being offered through Staples in a licensing agreement with NBC Universal using the fictional name of the Dunder Mifflin Paper Company from the hit show “The Office”
And finally, from our favorite sources, the New York City tabloids, the NY Daily News and the NY Post had two blaring competing headlines this morning: “NO HERM DONE” and “NO CAIN DO” , both referring to the unfortunate and messy end to Herman Cain’s Presidential aspirations.
Good Trading!
David W. (aka The Underground Trader)
Manager The FlashTrading Service
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