Monday, August 31, 2009

US Stocks Close August On Sour Note; DJIA Off 48 Pts

An overnight stock market slide in China spooked investors in U.S. industrial, materials and energy companies, including Caterpillar, Alcoa and Exxon Mobil, as a flight to safety weighed on U.S. stocks Monday.

Since peaking on Aug. 4, the Shanghai Composite has given back nearly a quarter of its value, including a drop of 6.7% on Monday. Throughout the world, and especially in the U.S., investors have been touting China as further along the recovery cycle, which has in turn lifted several stock market sectors in the U.S. Throughout the U.S. stock market's run since hitting decade-long lows in March, metals and energy stocks have been at the forefront.

But on Monday, materials stocks were weighed down as more China declines created trepidation. Within the Dow Jones Industrial Average, aluminum giant Alcoa lost 45 cents, or 3.6%, to 12.05. Other decliners in the index included Caterpillar, down 1.40, or 3%, to 45.31, and Exxon Mobil, off 97 cents, or 1.4%, to 69.15, as the oil giant was weighed down by a decline in crude prices. (more)

Wall Street Journal Europe August 31 2009

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Technically Precious with Merv

FREE weekly precious metals investment newsletter for August 28, 2009.

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Will Gold Reach $5000?

Martin Armstrong’s latest contribution poses the question of whether or not gold will go to $5000.
He does say it will reach $3000.
Mr. Armstrong, although living a complex life probably as a victim, has NOT been wrong ONCE on trend since I first knew him in the 1970s.
Keep in mind that loss of confidence in government is loss of confidence in the currency of that government. It is not jumping up and down yelling bad government.
Please review the following, and then you will better understand my strategy.

Cerberus clients overwhelmingly want out: report

Cerberus Capital Management has been swamped with redemption requests with the Wall Street Journal reporting that investors are asking to pull out $5.5 billion or 71 percent of assets from its hedge funds.
Cerberus last month tried to entice investors into staying with the firm, but found that its clients overwhelmingly wanted to leave, the newspaper reported. (more)

Is hyperinflation on the way? We’re spending like there’s no tomorrow.

The government printing presses continue to pump out currency with the backing of the Federal Reserve and, as a result, a bottomless pit is being created for all of us.

It is of the utmost folly to think that these spending programs by the politicians in Washington are of lasting benefit (think future tax increases) to the populace as a whole. Sure, the CARS program provided a temporary boost for a few — mainly dealers who sell vehicles bearing Japanese labels — but with no substantial gain for American label manufacturers. (more)

Economy Bottoming, Demand Improving, Frontline Says

The world economy may be improving from its worst slump in six decades, bolstering demand, said Jens Martin Jensen, head of the management unit of Frontline Ltd., the world’s biggest operator of supertankers.

The company, based in Hamilton, Bermuda, posted a better- than-expected 91 percent drop in second-quarter profit today.

“On the demand side, maybe the world economy has hit the bottom and things are starting to improve,” Jensen said by phone today from Oslo.

European confidence in the economic outlook increased twice as much as economists forecast in August, a European Commission report showed today. The U.S. economy, the world’s biggest oil user, shrank less than expected in the second quarter, and France and Germany returned to growth in the same period. (more)


The Trend Trader for Monday, August 31

Foreign Policy - September/October 2009

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FOREIGN POLICY is the premier, award-winning magazine of global politics, economics, and ideas. Our mission is to explain how the world works - in particular, how the process of global integration is reshaping nations, institutions, cultures, and, more fundamentally, our daily lives.

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Kiplinger's Personal Finance - October 2009

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