November 08, 2008

Ctrl BG: A Shortcut to Financial News 11/7

It was another turbulent week in the markets.

It started off with a rally as election day approached and everyone was filled with hope for change. On Tuesday, America finally voted for our next president- President Barack Obama. Even though the result seemed obvious in the last few weeks, it was still a very exciting day here in Chicago. Everyone in the streets were hyped, retailers like Starbucks and Ben & Jerry's were giving out free coffee and ice cream, roads around Grant Park were closed for the rally, the over all atmosphere was just very exhilarating! Unfortunately I wasn't one of the lucky few to get tickets to Grant Park, but I actually thought that both Obama's victory and Mcain's concession speech were really well done. Mcain's speech was very touching and gracious (though whoever dressed him with an ugly yellow tie should be shot), while Obama's speech was very inspiring- yes we can!

The next day after this pleasent distraction though, the market turned its attention back to the economy and it went downhill from there.
  • Retail chains posted the worst monthly sales data in more than 3 decades! Retailers are closing stores. Circuit City for instance is closing 155 US stores. Jewelers were also hit especially hard. Many, such as Whitehall and Friedmans, are being forced to hold liquidation sales, which in turn is creating temoporary price competition for its healthy peers
  • As sales drop, so did unemployment. The job report this week showed that in October, 240,000 jobs were lost, taking the unemployment rate up to 6.5% from 6.1% in September, hitting all sectors. Companies such as GS, Circuit City, Mattel, Time Warner, Yahoo, Ford and GM have or are planning to cut back their workforces
  • GM in particular posted worst than expected earnings and have called off their merger deal with Chrysler in order to focus on its own financial health. Chrysler is now in talks with Hyundai. The auto industry as a whole is not doing well in this economy (except Porsche, which posted a 46% rise in pretax profit) and the big three (GM, Ford and Chrysler) have approached the government for a $50 billion aid. The auto industry is in fact one of Obama's top priorities to save/ I guess since it takes up 3% of overall GDP it will have immense effects both directly and indirectly on the economy, and not just affect Detroit
Outside of the US, there was another gloabl rate cut, with the Bank of England cutting a whooping 1.5% and the European Central Bank cutting 0.5%.

The outlook is pretty pessimistic. Bonuses are slashed (ironically Bear and Lehman survivors are actually getting better deals from their retention package than their counterparts in other firms like Goldman). The next domino to fall seems to be consumer loans, such as credit card and auto loans. Predictions of when this will all be over just keeps getting postponed. Last week, it was middle of 2009. Now we're hearing beginning of 2010!!

Obama is already looking into all this at a
meeting of the transition economic advisory board, which included a high-powered collection of business, academic and government leaders, such as Buffet, who called into Chicago from Obama- just like Charlie in Charlie's Angels! His priorities are to get a second stimulus package out asap (maybe even before Christmas!) and saving the auto industry.

All this talk about presidency and campaigning just reminded me that I've forgotten to watch Brothers and Sisters this season. Better go catch up!


23 Comments:

Anonymous Anonymous said...

Are you aware that this is the largest post-election drop in the stock market in history? Wall Street is not happy with the result, and was not "filled with hope for change." I have been a loyal fan of your blog, but that is ridiculous.

11/08/2008 5:26 PM  
Anonymous Parantar said...

you're right anonymous. . . i'm also too a returning visitor here.

11/08/2008 9:15 PM  
Anonymous Anonymous said...

The auto industry could have saved itself if unions hadn't bankrupted them with their exhorbitant demands. Do you understand that concept? The union expenses go in before the price goes on. Many people are priced out of the car market, including myself. I drive my cars until they fall apart. Between taxes, medical expenses driven to the moon by greedy lawyers, and the union label on most things, I can't afford anything. People harp on corporate greed; what about union greed, lawyer greed, and on and on. Too bad some people are all caught up in "euphoria" instead of actually thinking.

11/09/2008 4:15 AM  
Anonymous Kate said...

haha, I love Brothers and Sisters!

11/09/2008 4:25 AM  
Anonymous Sophie said...

I find theses posts of yours very helpful, so thank you for that,
I guess at this point all we can do is be hopeful for a brighter future!

11/09/2008 4:28 AM  
Anonymous nishant said...

I'm more handsome than any guy in the united states.27

11/09/2008 5:14 AM  
Anonymous Anonymous said...

well stay where you are then, mr nishant, you would be crazy to come to the united socialist states of america.

11/09/2008 5:31 AM  
Blogger Tulz said...

You missed the big number this week. The number of people who were made unemployed this year hit 1,000,000. That's just sad.

11/09/2008 6:42 AM  
Anonymous Anonymous said...

Here's another number:

Billionaire Warren Buffett's Berkshire Hathaway Inc. posted a fourth straight profit drop, the longest streak of quarterly declines in more than a decade.

Charlie's Angels, eh? With help like this you will eventually need to change the name of your blog from IAmFashion to IAmRags.

11/09/2008 8:48 AM  
Anonymous Anonymous said...

I'm quite curious how you think BO is going to "get a second stimulus package out...maybe even before Christmas!"

Are you even aware that he is NOT the President of the United States? He has not been inaugurated. Inauguration is not until January 20, 2009.

You see, our founders were very wise and allowed a cooling off period between election and inauguration. Something disqualifying might turn up in the next two months. I certainly hope so.

11/09/2008 1:12 PM  
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11/09/2008 4:46 PM  
Blogger AusAnna said...

i love the direction of this post.
but it does suck, australia is really feeling the effects too.
poor retail. :(x

11/10/2008 12:14 PM  
Blogger Amber said...

Whoever is posting as "anonymous" needs to get a backbone and put a name to their oppinion. It's easy to say whatever you want when you assume no accountability.

With that being said, the market jumped 500 pts on election day; at least according to the Press Democrat on Nov. 5th.

And just to add to all the mess and depression, CosmoGirl's very last issue is printed next month! Be sure to grab your copy of this dying magazine!

11/11/2008 1:07 AM  
Anonymous Anonymous said...

Fair enough, "Amber."

My name is really "Macy's Girl."

;-)

11/11/2008 1:28 AM  
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11/11/2008 4:43 AM  
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7/05/2009 8:00 PM  
Blogger belhana said...

Thank you for the wonderful effort

إني تذكـرت والذكرى مؤرقـة *مجـداً تلـيدا بأيـدينا أضعـناه

أنَّى اتجهتَ للإسـلام في بـلـدٍ * تجْده كالطيرِ مقصـوصًا جناحـاه

كـم صرفتنا يـدٌ كنـا نـصرفها * وبات يـملكنا شعب مـلكناه

بالله سل خلف بحر الروم عن عرب * بالأمس كانوا هنا واليوم قد تاهوا

وانزل دمشق وسائل صخر مسجدها * عمن بناه لعل الـصخر ينعـاه

هذى معـالم خرس كـل واحـدة * منهن قامت خطيبـا فاغرا فـاه

الله يعلم ما قلبت سـيرتهم يومـا * وأخطـأ دمـع الـعين مـجراه

يا من يرى عمـراتكسوه بردته * الزيت أدمٌ لـه والكـوخ مـأواه

يهتز كسـرى على كرسيه فرقـا * من خوفه ، وملوك الروم تخشـاه

يا رب فابعث لنا من مثلهم نفـرا * يشـيدون لـنا مـجدا أضعنـاه

7/05/2009 8:19 PM  
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Anonymous Julius said...

This will not have effect in fact, that's exactly what I suppose.
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