Good to be back home! As much as Massachusetts drives me nuts, I always love to come home after a vacation. Jamaica was nice. Very hot and more humid than I would have thought. The sun is very strong as well and I got my first sunburn in about 5 years on Wednesday. The garden looks reasonable. The turnips I planted have the leaf tops emerging from the ground, the sunflowers are doing the same. Nothing from the potatoes as yet, and ditto the cucumbers. We will see.
The Week That Was
So Bennie Bernanspan did the 25bps cut to a FFR of 2%. The markets at first seemed to hate the move, and then on Thursday morning the markets seem to love it! Very schizophrenic of 'em, yes? Here is a 5 day DOW chart for last week:
That was quite the rocket ship move Thursday! The accepted reading of the FOMC statement was that the cuts are done now, and right on cue, as predicted here, the new found optimism was based on the idea that the FED must know all is well to be stopping the rate cuts. Seeing that the FED was totally wrong about basically everything related to the crisis up till now, why on earth would anyone place any credence in rate cut stoppage now? I dunno.
The FED is chasing their tale and looking ever more foolish every day. During the past week Mr. Bernanke rebuffed calls for the FED to step into the student loan arena, only to do a total intervention 2 days later! Whatever guys, seriously.
In other events, the dollar has been on fire and of course gold and silver are getting nasty hit. Why the dollar is rising here I have no idea, but that's what makes it a horse race. I mean, a stronger dollar because the FED may leave rates at 2% instead of cutting another 5obps maybe? Big deal. It kills me to see the metals getting whacked, but I am too wary to buy any at this time. I am a big chicken though
Microsoft Drops Yahoo Bid
Word is out tonight that Microsoft has pulled their enhanced bid for Yahoo. About time. MSFT made a reasonable bid, Yahoo wanted more, move along. I wonder how this will play out tomorrow.
I read Jack Finney's book "Time and Again" over vacation and all I can say is that you must read this book immediately. What an amazing work. I read tons of books and this one was truly wonderful and original. I have just bought the sequel "From Time to Time" and hope it will be great as well.
That's all I have for tonight, still not back into the groove you know? I plan to have a complete post tomorrow.
Have a good night.