Closing Bell

Closing Bell: 11.23.07

chucknorris.jpgBear Big’s Good Deal (NYP) If we’ve said it once, we’ve said it one billion times—it’s better to be fired by Bear Stearns than employed by it. There are a number of factors that led us to having two hundred t-shirts made up with this proverb printed across the back, the most basic being Carney’s drunken delusion that “it’d be cool,” but there’s also your own sense of self-worth, plus the fact that you can’t read about proxy access on the job to take into consideration. Another important point to think about if you’re a BSC employee on the fence about purposely trying to get yourself escorted from the building for good is that contrary to the writing on the 14th floor men’s room, James Cayne has not (yet) spent all the money set aside for severance packages on weed, and Bear is still keeping up with the Street’s grand tradition of rewarding failure handsomely. Former president Warren Spector, who was fired in August after someone told the firm it should at least pretend to be embarrassed about two collapsed hedge funds, and for being just as much of a bridge enthusiast/proponent of taking personal days during a crisis as Cayne, is being allowed to keep his $23 million vested stock position, $250,000 salary through the year’s end, a $207,000 retirement plan, and an “executive secretary” through December. He’ll also be guaranteed a pro-rated bonus.
Greenspan Has No `Regrets’ as Housing Slump Deepens (Bloomberg) Just in case you were wondering, Alan Greenspan has “no particular regrets” (about anything, ever) and said that the deepening slump in the U.S. housing market has nothing to do with his policies, or insistence on undermining every move Ben Bernanke makes (including this morning’s Jamba Juice. To wit: “Wow. Sure you want to do that? I’m sure you’re aware of how much sugar’s in that thing, right?”) He also stands by his previous statement about not giving a shit whether or not rich investors have seen their net worth go from $40 million to $5 million, and encourages everyone to go out and buy his book, on sale today. It makes a great stocking stuffer for those family members you hate but don’t yet have the moxie to kill (more on that later).
Norris Nuggets (Page Six)
FINALLY: “The Truth About Chuck Norris,” comes out next week. Author Ian Spector’s book has all the facts you already knew about CN (“The tears of Chuck Norris would supply enough liquidity to solve the credit crisis. Too bad he never cries.”), plus some new and exciting ones (“The day Citigroup became Shitigroup is the day Chuck Norris got fired from the firm for getting Maria Bartiromo pregnant on the corporate jet just by looking at her. It is not a coincidence.” “When Chuck Norris spends the day working out of Bear Stearns, he’s allowed to read, and use James Cayne’s private bathroom on the 14th floor.)
Goldman aims to raise $6bn for hedge fund (Financial Times) Like most perfectionists unable to accept that there might be something they suck at, Goldman Sachs, troubled by some difficulties mastering the money-making component of the hedge fund business of late, has responded to truthful allegations of Global Alpha being down sixty percent not by retreating from the hedges but by raising $4-$6 billion for a brand new fund. The unnamed entity will be run by Raanan Agus, former head of the proprietary trading desk and Kenneth Eberts, former head of the US prop desk. To Goldman’s credit, it has had the sense to realize that it’s not so good with the quantitative methods, and will be focusing on picking shares. Also smart? The two year lock-up.
City Homicides Still Dropping, to Under 500 (NYT) You’re much more likely to get killed by someone you know than a stranger. Like, for instance, a former employee.
Productivity Days Off (CNBC) CNBC Senior Economics Reporter Steve Liesman thinks the day after Thanksgiving should be a national holiday, because we would be more productive and make more money the rest of the year. He takes off his tie and throws it down on the desk just to show how serious he is about this. And yet, there he is, in Englewood Cliffs, NJ, still working. I tried a similar tactic of video taping myself untying my right sneaker and throwing it against the wall, uploading it to a video iPod and sending it to Carney. As you can see, it worked wonders. Next year will be the year Steve and I don’t take no shit from anyone. Who’s with us?

Closing Bell: 10.02.07

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Financial stocks took a pounding today. The Amex Broker-Dealer Index was down 2.52%. The volume on the stocks of companies such as Merrill Lynch and Citigroup was enormous. Merrill Lynch ended up losing 7.9%. Citi sunk down another 2%. Goldman lost 4.4%. JP Morgan Chase: down 2.6%. Both Goldman and Merrill issued statements trying to reassure investors that stories about misdeeds or losses were untrue but this seems to have only made things worse.
After spending most of the day in the dumpster, the major indexes managed to climb back to close to where they started, which was a couple of ticks below where they began the week. Despite the late afternoon recovery, it’s worth noting that only the Nasdaq Composite Index has seen a net gain this month. he Dow Jones Industrial Average scampered up 27.23, or 0.2%, to 13595.10. The S&P 500 found itself up 1.21, or 0.08%, to 1509.65. The Nasdaq wandered upwards 15.55, or 0.56%, to 2810.38.
Despite the heavy trading in the financial stocks, overall volume was just slightly above the new norm. On the New York Stock Exchange, 1.7 billion shares found new owners.
You can’t have cookies for breakfast but you can have FTAlphaville Crisp!

Closing Bell: 11.1.07

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Trick or treat? The great Pumpkin came and went, and all the markets got was a push back to the lowest levels in over a week, and the biggest one day decline since October 19, the anniversary of Black Monday.
Stocks opened sharply lower. The major indexes started off the day at or close to the lowest point they reached yesterday before the announcement of the rate cut by the Federal Reserve. In fact, the duration rate cut’s boost to the stock market may be the shortest ever, and a sign that investors are finally taking seriously the perplexing array of threats to corporate prosperity and the broader economy.
And what started out ugly, stayed that way for most of the day. Volume started out heavy, and declined rapidly midday. Many investors seemed willing to sit this day out. But volume and downward velocity returned in the final hour of trading, pushing the indexes further down by half a percentage point to a full point. The Dow Jones Industrial average was down 3.62.14 by the end of the day, a loss of 2.6%. It closed at 13567.87. The Nasdaq Composite didn’t fare much better, dropping 64.29, or 2.25%, to 2794.83. The S&P got the worst of it, losing 40.94 points, or 2.64 percent, for a close at 1508.44. It was a bloodbath for the financials, which been moving upward this week. The Broker-Dealer index lost 4.88%.
There will be lots of talk about what changed between the final hours of trading yesterday and this morning. Our explanation remains: the aggregate buying and selling activity of investors, motivated by heterodox and often unarticulated strategies, produced the results. But folks who like a more narrative approach will likely blame the CIBC credit analysts note on Citigroup, Exxon-Mobile’s earning’s report and the Federal Reserve’s actions and statements.
Indeed, a lot of the talk today has been about the Federal Reserve. Some investors have reacted negatively to the news of the rate cut and language of further problems in the housing market. If the Fed thinks things are bad, maybe we should listen, they whisper while they punch in their sell orders. Others are more disappointed by the impression the Fed gave that this was the last rate cut the market was going to see for quiet awhile. Last call at the punch bowl, fellas.
The increasingly doubtful prospects of the Entity have also produced worries. If the US Treasury, JP Morgan, Citi and Bank of America can’t make the Entity work, maybe the market for the mortgage-backed credit instruments they wanted to sell into it is even worse than anyone imagines. Focus finally—belatedly—seems to have turned to the ABX bond index, which keeps falling. And there are whispers everywhere that some of the big Wall Street firms—especially, Merrill Lynch—may have actually underestimated their losses from the credit crunch.
FT Alphaville will drop you to the *$%#$# floor.

Closing Bell: 10.31.07

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Investors began the morning warily. Trading volume was low and stocks climbed slowly and steadily. Last minute jitters before the Fed announcement sent the major indexes lower. But when the Fed revealed that even an economy growing faster than expected wouldn’t stop it from giving Wall Street the rate cut it was demanding, stocks soared once more. The Dow Jones Industrial Average flew up 137.54, or 1%, to 13930.01. The S&P 500 bounded 18.36, or 1.2%, to 1549.38. The Nasdaq Composite Index rocketed 42.41, or 1.5%, to 2859.12. Volume on the New York Stock Exchange was 1.6 billion shares, which is pretty much standard these days.
The Fed’s statement is largely being read as drawing a line in the sand. “This far we will cut and no further.” It remains to be seen whether they will be believed or whether the Punch Bowl caucus will be back demanding another swipe at the punch before the year is out.
Happy Halloween!

FT Alphaville
. Boo!

Closing Bell: 10.30.07

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Stocks closed lower today on Fed uncertainty, even though the odds are pretty much stacked in favor of Ben Bernanke doing whatever the traders tell him to do. The DJIA was down 77.79 to 13792.47, the S&P 500 lost 9.97 to close at 1531.01, and the Nasdaq fell 0.73 to 2816.71. The firing of some guy at Merrill Lynch sent shares down 2.76% to $65.56.
Sadly, Carney got bumped on “Happy Hour,” but can probably be found at the bar where they tape the greatest show on cable TV for at least the next few hours, if anyone’s interested (Bull and Bear, in the Waldorf).
Want more? FT Alphaville.

Closing Bell: 10.29.07

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Stocks nudged up a bit today. The major indexes gained as much as three-quarters of a percent each before declining a bit to close with gains nearer to one-half of a percent. The Dow Jones Industrial Average rose 63.56, or 0.5%, to 13870.26. The S&P 500 bloomed 5.70, or 0.4%, to 1540.98. The Nasdaq Composite Index, uhm, tuliped 13.25, or 0.5%, to 2817.44. The Amex Broker-Dealer Index saw even more action—both to the upside and the downside—today, and closed up 0.95%. On the New York Stock Exchange Monday, rising stocks beat decliners by 1.8:1.3. Volume declined a bit from recently elevated levels, so that just 1.2 billion shares traded hands electronic accounts.
After a brief dip downward following the opening bell, shares of Merrill mostly tracked the Broker-Dealer Index until around 1 PM, when they broke out to the upside. The stock closed with a gain of 2.01% for the day.
FT Alphaville. They liked alpha so much they made an entire village out of it.

Closing Bell: 10.26.07

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The Dow Jones Industrial Average rose134.78, or 1%, to 13806.70. The S&P 500 added 20.88, or 1.4%, to 1535.28. The Nasdaq Composite Index shot up 53.33, or 1.9%, to 2804.19. One billion, four-hundred million shares traded hands on the New York Stock Exchange.
The Amex Broker-Dealer Index gained 3.41%, helped along by Merill Lynch’s 8.52% surge. Countrywide surged even higher after it’s executives held a two-and-half hour conference call to report earnings.
FT Alphaville. It’s what’s for breakfast.

Closing Bell 10.25.07

Sponsored by the Financial Times.
Equities. After a slow start, the stock market worked its way into another day of high volume and volatility. Shares we up and down a bit in the morning and then took a downward tumble midday. The down and the S&P climbed almost back to flat in afternoon trading, with the Nasdaq once again falling behind. By the closing bell, the Dow was down 3.33, or 0.02%, to 13671.92. This was a slightly deeper drop than yesterday’s. The S&P fell 1.48, or 0.1%, to 1514.40. A slightly shallower drop than yesterday. The Nasdaq dropped 23.90, or 0.9%, to 2750.86. Also a shallower drop than yesterday. One billion, six hundred million shares traded hands on the New York Stock Exchange.
Bonds. Treasuries were all over the place today today. Yields on the two year t-bills fell to their lowest point in more than two years, but recovered to end down just 2/32s. The auction on the 5-year note generated relatively more interest than yesterday’s 2-year note auction had, but foreign central banks still seem to be avoiding US debt. Five-year Treasury notes were down 4/32 in price for a 4.03 percent yield. The 10-year note was unchanged for most of the day, and moved down 10/32 in after hours trading. The thirty year was down 18/32s.
Fed futures are showing an 86 percent chance of a quarter-percentage point to 4.5 percent at next week’s meeting. Yesterday some traders began betting on a 50 basis point cut, and the futures now indicate a 14 percent chance of the deeper cut.
FT Alphaville. Putting the Ha back in Alpha.