DOW 10K
Stocks soared over 10,000 on the DOW. How high can the DOW go? I think we are now very close to the top of this market. We could go as much as 300 points higher, but then the technical conditions start to bear upon stock prices.
Bonds went sideways today. Gold went sideways too.
The Dollar continued to lose significant ground against the Euro, with the Euro at an all TIME HIGH.
Oil jumped into new trading ground above $75/barrel today. This isn’t good for anyone (unless you own oil stocks.)
In the news today…..
Retail Sales – fell 1.5% in September. The fall in retail sales was caused by the ending of the Cash for Clunkers offer in August. People actually spent more on other things than cars in September. This means that August was artificially inflated by the government Cash for Clunkers deals.
Banks Pay – and how. Banks and securities firms will be paying their employees $140B in bonuses this year. It was a lot less last year, but the notable thing about the $140B is that the record amount ever given before was $130B in 2007. I guess things are just hunky-dory.
Bank of America Board – is troubled by what it is finding out about the Merrill deal. They are now cooperating with the government in its probe for the facts. This is undoubtedly why Lewis got fired.
Tonight’s Dinner Conversation…..
We heard first hand from a very reliable source that Shiela Bair, the head of the FDIC, said over a lunch just recently that the $250,000 FDIC guarantee that was extended during the crisis – when it used to be $100,000 FDIC insurance – “will be reversed.”
The FDIC undoubtedly is trying to save money, and the $250,000 guarantee is costing it money. So, reversing it is interesting at best.
I am telling you this so you can think about your own bank accounts, and how you must reduce them to below $100,000 when this announcement is made – so you can plan it out now. It is a big pain in the a…., I know.
The question for tonight is “What will happen to the economy when this reversal is implemented, and why?”
Here are the last numbers for today:
Dow Jones 30 Industrial – 10015 (up 145 points)
10 Year Treasury Bond – 3.42% (up 0.11%)
Euro – $1.4925
Gold – $1063 (up $3)
Oil – $75.32 (up $1.15)
Gasoline – $1.86 (up $0.03)
