Friday Positioning
Stocks shot forward on the news that Google made a huge profit, and CitiGroup didn’t go bankrupt, but just came in with a big negative. Irrational.
Bonds continued moving up a little in interest rates as there is a rumor the FED may not cut interest rates at all next time around.
The Dollar strengthened as the currency traders took some of their profits off the table after the recent new highs (lows for the dollar).
Oil hit another new high of $117. And gasoline continued to power upward. For those of you who follow the oil and gasoline numbers below, I am reporting the value off these commodities on the futures market. This is the price of gasoline fob the refinery. Transportation, taxes and profit must be added to get to the pump prices.
In the news today……
Stocks went up today because of the Citi results. That great sigh you heard was everyone saying their thanks. Citi reported they were writing down an additional $14B. THAT IS A BIG NUMBER. Last quarter they only wrote down $18.1B. Oh, by the way, they are laying off 9000 employees too.
When you look at what makes up the $14B write down
, it isn’t just those lousy sub-prime mortgages. It also includes some bad credit loans, bad hedge funds loans, bad mortgages, etc. etc. This means the credit meltdown, and bond value implosion, have spread over to all types of paper investments. (Do you know what you are invested in??)
Drip, Drip, Drip……
It ain’t over yet folks!!!
From a philosophical point of view, Friday is generally not too exciting as people “position themselves” so that they don’t get killed if something bad happens on the weekend.
Here are the numbers:
Dow Jones 30 Industrial - 12,849 (Up 229 points)
10 Year Treasury Bond - 3.74% (Up 0.01%)
Euro - $1.5819
Gold - $915 (Down $28)
Oil - $117.00 (Up $1.83) - an ALL TIME HIGH
Gasoline - $2.99 (Up $0.03) - Gasoline keeps moving up, up, up, up….!!!!!!!!!!!!!!!
