Thin Week

This is a thin week on many fronts due to the holidays and the new year, so it is wise not to read too much into any news. Stocks being down a smidge is an example. With trading volume low it does not take as much to swing things. January and February will be another tale. Despite the slim trading, the news remains dismal on the retail front, as Bloomberg reports. Not a surprise, just an affirmation.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aOVg4pkw229o&refer=home

Unintended Consequences by the 800 Pound Gorilla

The 800 pound gorilla here would be the U.S. and other developed countires We are borrowing at an alarming rate. Still, people are flooding to Treasuries as a safe haven - for now, anyway. The question not asked much before is where would those dollars flow otherwise. After all, we are borrowing trillions of dollars, soaking up global capital like a desperate sponge, with little thought to the other players looking to secure some of those dollars. Well, it would seem that developing countries will once again take the brunt of our indiscretion. Their credit is drying up just as they need it most and in no small part to the larger players being on a borrowing spree. If this does not correct in time, more issues will face the global economy that will be hard to fix in short order.

http://www.nakedcapitalism.com/2008/12/emerging-economies-risk-being-crowded.html

And if you believe that, I have a bridge to sell you...

Apparently, you too can soon own a bridge, or highway, or lottery or other state assets, either full out or at least for a time. Yes, it is true, state governments are in desperate need for cash and desperate times require desperate measures. So states left and right are looking at some ways to sell, or at least lease, some of their crown jewels in terms of reveune generation in order to quickly raise some needed mula. Form your own opinion on this. To me, at least a limited term lease to make ends meet makes sense, but selling off long-term income generating assets - likely at fire sale prices - is a bit short-sighted. But then again, I am not facing a multi-billion dollar deficit, so what do I know.

http://www.financialarmageddon.com/2008/12/more-bad-choices.html

Almost Heaven

As noted yesterday, I spent the holidays with family in West Virginia. Some people have thoughts about my home state that are not too positive. Yet, I love the state and have some points to note in its defense:

1. WVU won its bowl game this year and its quarterback, Pat White, after throwing for 332 yards, won his fourth bowl game as a quarterback to set a record. This is in addition to being the NCAA all time record holder for rushing as a quarterback, not to mention having the most touchdowns of any college quarterback.
2. WVU beat the pants off Ohio State in basketball this past Saturday.
3. WV is the only state in the country that did not have an increase in unemployment between November 2007 and November 2008. And their unemployment rate, at 4.6%, is well below the national average.
4. Did I mention that it is an absolutely beautiful state?

Despite some not-so-nice comments I have heard over the years, WV is a great place and I am proud to be a mountaineer.

http://www.bls.gov/web/laumstch.htm

Not on any list!!

My first year of blogging and I have escaped all the lists of worst predictions. Now I could say this is due to making no clearly wrong predictions. Or it could be because the few dozen people who follow my blog did not write these lists. Either way, good not to be on them. Still, these list are some good reading. Some people went way off the mark and paid the price (or at least those that listened to them paid the price). One reason I give no advice. For those Hogan's Heroes fans, I am the Shultz of the blog-sphere: I hear nothing, see nothing, know nothing. Yet here you are, reading what I have to say. All I can say is thanks.

http://www.ritholtz.com/blog/2008/12/worst-predictions-for-2008/

DOW DOWN

For once I am not talking about the Dow Jones Industrial Average. This time it is about Dow Chemical. Its deal with Rohm and Haas appears over as Kuwait is drawing in the purse strings. Let's speculate that Kuwiat, like the rest of the Middle East, is feeling the pinch of low oil prices. Otherwise, they no longer saw the wisdom to the deal. Either way, Dow Chemical is being down graded and the stock is down big time today, as is Rohm and Haas. Will we need chemicals tomorrow, sure, but not as much as we needed a year ago. This demand will eventually return to some extent, but the question today is whether Dow Chemical will be here to enjoy the bounce?

http://www.bloomberg.com/apps/news?pid=20601087&sid=aEOpmCv.eKSE&refer=home

The Big Oil Rebound

I have noted here repeatedly that I despise analysts predictions as most cannot tell their predictions from a hole in the ground. In other words, they put the anal in analysts. Yet I feel compelled to report on their latest prediction. They predict $60 a barrel oil by next year. While I have little doubt it might hit that mark, I must say I disagree with any prediction that keeps oil on average that high next year. Mind you, "that high" is very low by recent standards, but I still disagree with these predictions, at least for 2009. If I am correct in my anticipation that the global economy, and especially China, will suffer big time in 2009, I think the dampered demand will, on average, keep oil in the$50 a barrel range or lower. OR - I could be wrong!!

http://www.bloomberg.com/apps/news?pid=20601087&sid=abtq_Q4RkQJQ&refer=home

Disclosures: None - other than I am from West Virginia.