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Posted by: Howard Silverblatt on February 27, 2010
February was a sweetheart of a month, with love for all (it’s all in the definition), and not just on the 14th. The FDIC loved another 500 banks, raising its list of ‘challenged’ institutions to 702 from the 252 that were the center of their admiration at year-end 2008. Google decided to engage China in talks, as one part of Congress accelerated their love for Toyota, while another part of Congress yielded their approval for Ben with hopes of him not yielding some back. The quick Volker rule seemed to be more of a dating process, sometimes called discovery, other times called politics. Wall Street quantified that its love for bonuses had derived a 17% growth rate (not sure if there is a default swap on it – they never tell you to after the event), as both buybacks (at least for authorizations – the proof however is in the trade) and dividends (best month in 2 years – and that’s cash in your hand) come back into fashion. The Democrats and Republicans tenderly played with Health Care, in a picture (or photo) perfect setting, as investors fell in love with the dollar (actually they just liked the Euro a lot less), new home builders decided they loved their homes too much to sell them, translating into an 11.2% sales decline in January, as existing home owners also stayed put, as represented by a 7.2% decline in existing home sales. GDP was set 5.9% for Q4, but warnings emerged that 2010 may not be as good (everything is relative, and as stated in the definition). Canada started off depressed by its lack of metal, but cheered up as its ladies hockey team took gold (with the ladies starting the party on the ice); Canadian investors however were much more happy, as Canada performed the best of all global equity markets in February, permitting those people to party even more. The only one left on the side line appeared to be the consumer, whom with no one to turn to, were down right depressed over their insecure, paranoid, emotionally inspired belief that higher prices, higher taxes, and fewer jobs were ahead of them (where do they get that from? didn’t they get the memo?). That, even though it now appears that many of them may be classified as rich. These malcontents sent the Consumer Confidence Index down to 46 from an already discouraging 56.5; someone needs to lobby them a pick-me-up e-card, or at least something more than a token stimulus package. March madness is coming (Syracuse will beat Villanova, but in the end ‘you’re not in Kansas anymore’; if the President speaks basketball, you need to speak basketball), but in Washington, March madness will be called reconciliation, which should insure late-night TV employment.
Full February report available
Businessweek’s Emily Thornton, Amy Feldman, Ben Levisohn, and Ben Steverman focus on matters great and small for investors, from the views of a hot fund manager to an explanation of the latest products devised by Wall Street’s rocket scientists. Exploring trends in any area, from bonds and stocks to closed-end funds and futures, always with an eye towards giving investors a better understanding of the sometimes confusing and often chaotic world of finance. Standard & Poor’s senior index analyst Howard Silverblatt will also provide his take on companies’ finances and the markets. Voted one of the “Top 100 Finance Blogs” in 2007.