[tdrive]

$this->bbcode_second_pass_quote('', 'I')nsider trades are always important to view the direction of the stock markets. When insiders sell you better listen.

[smiley]

$this->bbcode_second_pass_quote('', 'Y')ou be careful, becasue they may sell for various reasons, not becasue they believe the stock will dive and they have to cache in early. Most of the time they sell for diversification reasons. Bill Gates for example kept selling hundreds of thousands of shares a month of MSFT all the way up, exactly for that reason. Don't mix capabilities with intentions.

[Taskforce_Unity]

If the american stockmarket crashes (dollar crash) what will then happen to european stocks? will they crash too or rise because relatively the euro is worth a lot more? or will the american markets let the european markets follow (no market disconnection)?

[Kingcoal]

The problem with a dollar crash is that a lot of currencies around the world are based on dollar holdings. It would be a world wide crash. Our current mess:

Goldgate

Since the Euro is market-aligned with gold, we have been seeing the Euro go up with gold. The dollar, which is backed by nothing more than GWB's smirk, is sinking. What's interesting is that many European economies, unlike the American economy, are based on exporting goods to the world. They don't want a super strong Euro. The US seems to be willing to let the dollar drag in the slime which will hurt European and Asian export economies and help whip the US production economy into shape. If the US can start producing and exporting again, there are plenty of dollars out there available to buy the goods produced.

I believe the above is the secret US strategy. There will be a lot of readjustment for Americans, however.

[smiley]

$this->bbcode_second_pass_quote('', 'T')he US seems to be willing to let the dollar drag in the slime which will hurt European and Asian export economies and help whip the US production economy into shape. If the US can start producing and exporting again, there are plenty of dollars out there available to buy the goods produced.

I believe the above is the secret US strategy. There will be a lot of readjustment for Americans, however.

[Permanently_Baffled]

I think also in addition to Smileys points is that it will take a long time for manafacturing to relocate back to the US even if the currency sunk low enough.

The range and diversity of products that are no longer made in America is immense, relocating all this production capability back to the US would take time and be rather risky. Imagine if the dollar appreciated back again after you have just set up your production in the US again! LOL

Just a thought....

PB

[Kingcoal]

Foreign companies make a lot of stuff in America, which is sold in America to Americans.

For the past 10 or so years, a lot of continental European companies have been moving their production to the US because of, well, a cheaper more productive work force. BMW, for instance, finds much a much more flexible labor market than in Germany. The Japs have been doing the same thing. A lot of American consumption, while bought from foreign companies is made in the US, Canada or Mexico. Sony makes their big screen TVs in the western part of my home state. Most big picture tubes are also made in the US (those for US consumption.) Japanese cars are made in the US.

What isn't made in America anymore? Clothing has largely moved to Asia and India. Low end electronics such as TVs, HiFi, etc. Inexpensive housewares, etc. Basically anything that is cheap and produced in the millions is imported from Asia.

Currently, very little is exported from the US, it's mostly sold into domestic consumption (the worlds biggest market.) BMW said, "why not make the cars that we sell in the US, in the US? A question for our European friends: will Europeans buy a BMW or Mercedes or VW made in the US if it's half the price of one made in Germany?

[bart]

$this->bbcode_second_pass_quote('smiley', '
')Economics are not only about hard cold numbers, but also about sentiment. Right now that sentiment needs some serious mending. I believe that is more important than the realignment of the currencies.

[smiley]

[QUOTE ="kingcoal"]BMW, for instance, finds much a much more flexible labor market than in Germany. [/QUOTE]

There is no need for euphemisms here. When you talk about labor "flexibility" you basically talk about two things:

- Minimum wage
- Job protection (how easy is it to fire someone)

In both aspects the US has a distinct advantage over Europe. Those states which actually have minimum wage laws prescribe a minimum wage between $600 and $900 dollars. Here the minimum wage is $1668 dollars for a 25 year old.

It is also harder and much more costly to fire someone here. While the intention of these laws is good, they make it very difficult for a company to adjust to a changing economic climate.

That is certainly a reason to relocate. My former company opened a facility in the US for those reasons. However they quickly found out that it is not all positive. While the average wage in the US is very low the management salaries are extremely (absurdly) high and growing strongly (The top salaries in the US are growing at an annual pace of more than 10%). This is problematic because if te top salaries keep growing faster than the currency devaluation you won't be able to fully exploit the advantages of a cheaper currency from a manufacturing point of view.

Since state laws have rules about how many foreigners are allowed to work at a company they couldn't install a European management against European wages. Therefore they have shut the facility down after three years of operation and moved it to Poland.

$this->bbcode_second_pass_quote('kingcoal', 'C')urrently, very little is exported from the US, it's mostly sold into domestic consumption (the worlds biggest market.) BMW said, "why not make the cars that we sell in the US, in the US? A question for our European friends: will Europeans buy a BMW or Mercedes or VW made in the US if it's half the price of one made in Germany?

[The_Virginian]

$this->bbcode_second_pass_quote('', 'I')f the US can start producing and exporting again, there are plenty of dollars out there available to buy the goods produced.

[NevadaGhosts]

Stocks Skid As Oil Prices Skyrocket

By THE ASSOCIATED PRESS

Published: March 2, 2005

NEW YORK (AP) -- Stocks skidded Wednesday as soaring oil prices offset bullish testimony about the state of the economy by Federal Reserve Chairman Alan Greenspan.

In the final hour of trading, the Dow Jones industrial average retreated 23.05, or 0.21 percent, to 10,806.95. That was also down from an intraday high of 10,869.83 -- a level it hasn't closed at since June of 2001.

The broader gauges also retreated. The Standard & Poor's 500 index shed 0.84, or 0.07 percent, to 1,209.57. The Nasdaq composite index was down 1.17, or 0.06 percent, at 2,070.08.

Greenspan was upbeat about the economy in remarks to the House Budget Committee, and did not hint at any upcoming changes to the Fed's monetary policy. He emphasized the importance of congressional action on Social Security, and said hiking taxes would be negative for the economy right now. While it was a relief to investors that he did not hint at a more hawkish policy on rates, the surge in oil prices was too great for the market to ignore.

``Oil prices were relatively calm to start the day, they were around $52 and seemed like they were going the right way, then they rallied, and that certainly has spooked the market,'' said Brian Pears, head equity trader at Victory Capital Management in Cleveland. ``There's also something to be said about the fact that we're constantly bumping up against these yearly highs ... yet we can't seem to get through. I think people get scared.''

The U.S. Energy Department's weekly supply report showed a rise in gasoline and crude inventories, and a decline in stores of distillate fuel, which includes heating oil and diesel. But a separate report from the Paris-based International Energy Agency suggested global energy demands were likely to rise during 2005.

Traders were apparently willing to bet prices would do the same. Light, sweet crude for April delivery soared $1.37 to settle at $53.05 a barrel on the New York Mercantile Exchange, a four-month high. The dollar edged higher against other world currencies, gold prices were mixed and Treasuries turned bearish; the yield on the benchmark 10-year note was at 4.38 percent, up from 4.37 percent late Tuesday.

Oil worries, combined with persistent concerns about inflation and interest rates, have made for a difficult market, and analysts think more volatility lies ahead. And while the absence of surprises in Greenspan's comments was cause for short-term cheer, it wasn't enough to allay investors' deeper worries, which have contributed to a ``one step forward, two steps back'' climate for stocks.

``The tone of the market seems strong (but) we're in a cautious atmosphere,'' said Peter Cardillo, chief strategist with S.W. Bach & Co. ``There's a willingness to buy, but the uncertainties of how high interest rates have to go, and the potential impact of rates moving up in a more aggressive way, has got investors a little bit nervous.''

[SD_Scott]

I watched part of greedspans speech and I was very surprised to hear the lack of energy content. Social security?

[maverickdoc]

WOW oil closed above $53 bbl

CRAZY

ON CNBC they said it was all speculation, and the price of oil does not matter

the best joke I heard all day

[SD_Scott]

I heard it was a refinery in Texas that had some problem. This definately shows the complete fragility of the world oil infrastructure. One little hiccup and bam. Even a rumor would do it.

[maverickdoc]

$this->bbcode_second_pass_quote('SD_Scott', 'I') heard it was a refinery in Texas that had some problem. This definately shows the complete fragility of the world oil infrastructure. One little hiccup and bam. Even a rumor would do it.

[Jack]

Per the Wall Street Journal, Crude is up 22% so far in 2005. West Texas Intermediate is up 46.6% from one year ago. Are we seeing price acceleration - as would happen if he were at peak? Hmmm?

[maverickdoc]

$this->bbcode_second_pass_quote('Jack', 'P')er the Wall Street Journal, Crude is up 22% so far in 2005. West Texas Intermediate is up 46.6% from one year ago. Are we seeing price acceleration - as would happen if he were at peak? Hmmm?

[SD_Scott]

http://money.cnn.com/2005/03/02/markets ... tm?cnn=yes


$this->bbcode_second_pass_quote('', 'G')ains were erased in the afternoon as oil prices rose. U.S. light crude oil for April delivery rose $1.37 to settle at $53.05 a barrel on the New York Mercantile Exchange, a four-month high. The spike was due to Texas refinery troubles propelling gasoline futures, according to a Reuters report.

[marko]

$this->bbcode_second_pass_quote('maverickdoc', 'O')N CNBC they said it was all speculation, and the price of oil does not matter

[savethehumans]

$this->bbcode_second_pass_quote('', 'O')il worries, combined with persistent concerns about inflation and interest rates, have made for a difficult market, and analysts think more volatility lies ahead.