Quotable Quotes: “Blanko-Scheck fur Schuldent-Staaten"September 9, 2012 @ 7:43 PM EST
We had the “Big Four” of stories dominating the headlines last week: The Democratic Convention in Charlotte, NC, the ECB action and Draghi press conference, further speculation over the FOMC meeting and possible announcement next week, and the disappointing jobs report, which tied into the other three storylines.
In terms of market action, the ECB certainly stole the spotlight, helping to lead the S&P to a new multi-year high, most of it achieved on Thursday’s melt-up. On the week, the SPX was +2.2%, the Dow +1.6%, and the NASDAQ Comp +2.3%, helped again in no small part by AAPL. (The NASDAQ actually put in a 12-year high (!), the highest since before the dot-com bust). The VIX was down -17.7% on the week, with the short-term volatility index VXX hitting all-time lows.
Let’s get directly to the “Quotes of the Week” without further delay, given the nonstop nature of the news flow this past week.
Mario Draghi achieved quite a remarkable feat in announcing the new acronym we all must now learn, “OMT” (Outright Monetary Transactions), driving down interest rates in many European countries without having yet actually doing anything. But according to some, “the bears could be heard scoffing, saying that the idea of buying bonds of troubled countries isn't going to solve the problem”. (Stateofthe Markets.com). BlackRock’s iShares strategist Russ Koessterich said on Sunday’s NBC Wall St. Report, “the ECB action gave European politicians the gift of time, but many major issues still to be addressed”.
“Blanko-Scheck fur Schuldent-Staaten. EZB-Chef Draghi macht er damit den Euro kaput?” –The German Bild, which really needs no translation but we’ll give one anyway: “Blank Check for Debt States. Did Draghi just break the Euro?” (Business Insider). According to BI, “The German Press Goes Berserk After Draghi” (and not in a good way).
“Band-Aid or Leap Forward?” -WSJ European Crisis Blog, which provided a handy-dandy summary of the many conflicting pro reactions to the ECB action, with seemingly a leaning toward “a step in the right direction, but by no means the final chapter” seeming to be the majority POV.
The Democratic Convention unleashed a torrent of memorable lines, more than we can possibly cite here:
“If you want a ‘you’re-on-your-own, winner-take-all’ society, you should support the Republican ticket. If you want a country of shared prosperity and shared responsibility—a we’re-all-in-this-together society—you should vote for Barack Obama and Joe Biden.” --Pres. Bill Clinton, in a speech which almost universally got rave reviews for persuasive power and called “certainly the most influential since he left office.” The Washington Post “Fact-Checker” gave many of his “job creation statistics” claims a “One Pinocchio Rating”, which “does not represent an outright falsehood but more a selective telling of the truth.”
“Folks, ‘The Bain Way’ may bring your firm the highest profit. But it’s not the way to lead your country from its highest office.” --VP Joe Biden’s speech
“Ask Osama bin Laden if he’s better off now than he was four years ago.” -- Sen. John Kerry in one of the better lines of the convention, scoring from several different angles, but ironically it was Kerry who was on the receiving end of foreign policy “disses” ran he ran for President.
"You might not be ready for diplomacy with Beijing if you can't visit the Olympics without insulting our closest ally.” –Pres. Obama, in his speech mocking Romney’s Olympic gaffe in London this summer.
“For Barack, success isn’t about how much money you make, it’s about the differences you make in people’s lives.” --Michele Obama’s speech, which some credited with possibly catapulting her into a prospective political career if she wanted to pursue one (and which raises an interesting question: who has the greater chance to become the first female President over the next 12 years: Hilary Clinton, Condi Rice, Michele Obama, Sarah Palin, or someone else?)
But Friday’s jobs report and some other data this week allowed for a little firing back from the GOP opposition;
"If last night was the party, this morning is the hangover. There’s almost nothing the president has done in the past three and a half, four years that gives the American people confidence that he knows what he’s doing when it comes to jobs and the economy.” --Gov. Romney referring to the jobs numbers, especially in the face of Bill Clinton’s claims
"This is not even close to what a recovery looks like.” --Rep. Paul Ryan
“If this labor market were a horse, they’d send it to the glue factory,” said Andrew G. Biggs, an economist at the American Enterprise Institute. “Lucky for the horse, the factory is closed, too.” (NY Times)
Obama continues to fight back with a somewhat lame rebuttal joke (in our opinion), “All they’ve (GOP) got to offer is the same prescriptions that they’ve had for the last 30 years: tax cuts, tax cuts, gut some regulations, oh, and more tax cuts. Tax cuts to help you lose a few extra pounds. Tax cuts to improve your love life.”
And in a very related story, “Consumer Comfort Gauge Signals Severe Discontent for Fifth Week”. (Barron’s), citing the Bloomberg Comfort Index this week and saying, “The current reading was -46.5, the fifth consecutive week the index has registered a reading lower than minus 40, a level typically associated with severe economic discontent.”
Beyond “The Big Four” stories there were just a few other things happening last week:
“Facebook Shares Bounce On Zuckerberg's Vow Not To Sell” --Forbes Eric Savitz, adding “While that does not mean other insiders won’t sell as hundreds of millions of additional shares become free trading in the months ahead, investors are taking heart from the news that the company’s founder intends to hang on to his large stake, at least for now.”
Intel (INTC) and FedEx (FDX) both rattled the Street a bit with downbeat outlooks for a variety of reasons, while on the plus side of the ledger, U.S. automotive sales came in better than expected, with a +19.9% increase.
“Apple’s email invitation shows a big "12," for Sept. 12, casting a shadow in the shape of a ‘5.’ ” --NY Daily News reporting on a widely publicized “invitation” by AAPL to the press and tech industry in San Francisco for August 12th, where it is expected the new iPhone 5 will be announced and strong rumors that a smaller version of the Ipad may be revealed.
“Wearing a lace top that offered even less resistance than the Jets offensive line, actress Eva Longoria strutted her way to an evening of entertainment (with Jets QB Mark Sanchez)”. –NY Post, on yet another distraction for the press to feast on concerning the Jets, Tim Tebow, and Sanchez.
"The partying is long gone. I'm a new person." --People Magazine, in an exclusive interview and photos celebrating Jersey Shore star Nicole "Snooki" Polizzi and her