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Recap of Last Week

By Steve Romasko

All eyes were on the Federal Reserve this week as they met on Monday and Tuesday to discuss further policy action in order to stem the economic crisis. From the meeting, the FOMC cut the target rate from 1.00% to a first-ever ‘range’ of 0.00-0.25%—effectively eliminating a major policy tool. However, the Fed made it clear that aggressive action will stay the course, and they will do everything possible to stimulate the credit market and the economy— perhaps by buying long-term treasury securities.

Bond traders reacted to this news by piling into long-term Treasuries—notably, the yield on the 10-yr note fell 49bps to 2.08%, while the 30-yr bill returned 2.52%, down 52basis points from the week prior. The seemingly relentless resolve of Bernanke & Co. to stimulate the economy on an infinite basis sent shorts heading for the exits and caused markets to rally 5.1% on Tuesday. However, the market gave back roughly 3.5% of Tuesday’s gains on Wednesday and Thursday, as economic reports were poor and investors returned to the notion that there’s no short-term panacea to fix the economy overnight.

Regarding economics—Industrial production declined 0.6% in November, housing starts declined 18.9% (the largest since March 1984), building permits hit a low and initial jobless claims – while  better than  consensus – are at a 26-year high.

Continue reading ‘DIG Presents: The Weekly View (Week of 12/22/08)’ »

Click HERE to view full report

NOTE: This week’s report is appearing late and in shortened form as a result of of the Holidays. It will return to its original form next Sunday.

Recap of last week

By Steve Romasko

Despite the amount of horrid headlines that surfaces on newspapers this week, equities managed to finish the week on a positive note with the S&P 500 giving a 0.4% gain. Wall Street got off to a good start on Monday, following President-Elect Barack Obama’s comments over the weekend—where he supported the need for a massive stimulus package when he takes office to jumpstart the economy and put fiscal prudence on the back burner. The stimulus, as it seems, will be put toward an infrastructure plan, and will potentially create 2.5 million jobs— something not seen since the Reagan era, which led to the development of the US highway system. The market took the announcement as a sign of the incoming administration’s willingness to do whatever it takes to solve the current crisis and rallied as such—closing up 3.8% for the day.

 However, this particularly good news was overshadowed by a wave of poor earnings guidance, economics, and emerging scams. Tribune filed for Chapter 11; 3M, FedEx, Texas Instruments, Kroger, and Electronic Arts to name a few issued downward earnings guidance—suggesting that the crisis has officially spread from a few concentrated sectors to the broad market. Onward, economics were poor with Jobless Claims touching a 26-year high, 573,000, and continuing claims hit 4.43 million; November retail sales fell 1.8% in October—the 3-month trend to month-end November is down 4.7% from 3-month-end August. As a sign of current times, yields on the 1-3 month Tbills turned briefly negative—meaning that some investors actually were ready to pay the government to hold their money.

Continue reading ‘DIG Presents: The Weekly View 12/15/08’ »

Final exams, final papers, final projects, final presentations  - wowzers (could have probably thought of better word there)!

Not to worry, our friends in the blogosphere aren’t short on suggestions for students like me (and you) who might be freaking out. Head over to College Fashion (here) for “6 Tips to Beat Final Exam Stress” and then take a minute to check out Zen College Life (here) for some practical planning pointers.

Don’t forget to take some time to relax this week - take a walk, or better yet, drink some tea!

Good luck!

Ari

Need a break before finals? Want to network with guest speakers and have a free fancy feast? Want to know more about Private Equity?

Save this date:

-Wednesday December 3

-7pm

-Private Dining Hall at Handshumacer Dining Center

Come and join a free fancy holiday feast before finals week. Also come and hear the different opportunities available at DuPont, and learn more about the different concentrations of finance. This is a great networking opportunity for all business major as well.

It is never too late to join Phi Beta Lambda (FBLA-PBL). If you are interested, just stop by.

To read the full report, click HERE.

Recap of Last Week

by Steve Romasko

The bear market investors are currently experiencing took a turn for the worst, when the S&P 500 not only set new lows for the cycle, but erased all of the gains from the 2002-07 bull market. Uncertainty was the order of the week, following poor corporate news, economics, and the Big Three leaving Washington empty-handed. Citigroup was front-and-center in corporate news, as investors worried that capital-raising is imminent among financials in order to offset the steep losses. Adding fuel to the fire, was surfacing signs that the commercial mortgage backed securities (CMBS) market is beginning to deteriorate— evident in the defaulting $209 million loan made to Westin Hotels in Arizona and South Carolina , as well as the defaulting $125 million loan made to the Promenade Shops in California; both loans were originated by JP Morgan. Investors saw no signs for a positive outlook, took this as such, and triggered a broad sell-off in the financial sector. Citigroup, however, took most of the pain with their share price plummeting 60% to $3.77, amid no indication of pay cuts from senior executives and announced plans to cut 52,000 jobs.

Continue reading ‘DIG Presents: The Weekly View 11/24/08’ »

Business and Engineering Society, NABA, Beta Alpha Psi Presents: