City workers and union members won a victory against financial prudence in Los Angeles today.
The city council spent all day yesterday discussing drastic cuts made necessary by LA’s $208 million budget gap. The city’s budget analysis proposed around 1,000 job cuts to save money.
And so the municipal unions went wild, packing the meeting with hundreds of workers.
In response, the city council voted to postpone budget-related layoffs for 30 days.
Frighteningly, on the same day the council members voted against cutting jobs and consolidating the disability, human services and environmental affairs department, it also agreed to discuss making jobs cuts in the police and fire departments.
Even worse, LA council members are talking about "unconventional ways" of addressing their looming financial crisis.
"If I’m facing hard times . . . I’m going to go to my uncles. I’m going to go to my aunt. I’m going to ask them to borrow money," Councilman Jose Huizar said, according to the LA Times. "But I’m going to tell them: ‘You know, I’ve got this ’67 Chevy. I could sell it a year from now and maybe I’ll pay you back with that.’ Can we do anything like that?"
The problem, of course, is that LA’s uncle is the State of California, which is facing a giant budgetary crisis of its own. It doesn’t have the money to bail out LA. And muni bond investors are unlikely to love the idea that LA will find some way to raise cash in the future to compensate for its inability to restrain spending now.
Will the ratings agencies wait 30 days before slamming LA? We’ll see.
With the emerging market currencies and financial markets under attack; Japan’s Nikkei index collapsing in the last three weeks; and the Federal Reserve hinting about its disciplinarian tapering of $85 billion in monthly QE3 bond purchases, one would expect higher beta small cap stocks to get hammered in this type of environment.
Before benchmarking results in the U.S., let’s take a closer look at some of the international carnage occurring from this year’s index value highs:
With 99% of companies reporting for Q1-13 earnings season, here is the latest update of my ongoing "thought experiment" for forecasting the S&P 500 price based on earnings fundamentals.
The chart below is based on the latest trailing twelve-month earnings (TTM) data published on the Standard & Poor's website as of June 13, 2013. The numbers are from the spreadsheet maintained by senior analyst Howard Silverblatt. See dshort's monthly valuation update for instructions on downloading the spreadsheet.
Deals and announcements over the weekend lend credence to the notion that a recovery in North America’s forest products market may be underway.
For starters, one of the world’s largest lumber companies is about to get larger. The Seattle Times reported Sunday that Federal Way, Washington-based Weyerhaeuser (NYSE: WY) has struck a deal to buy Longview Timber from Brookfield Asset Management (NYSE: BAM) for $2.65 ...
The market responded well today to good economic news and to the positive and somewhat surprising response to the election of a moderate Iranian President. Some moderation in Turkey didn’t hurt either, and overnight positive markets in Asia and Europe gave bullish investors enough encouragement to buy equities broadly.
This drove all three major domestic indices up about 1% before a late small selloff left the S&P 500 Index up nearly 1% and the Nasdaq and Dow Jones Industrial Average both up well over 0.5%. We think it likely this week that the market will challenge highs set in late May.
Today’s positive economic news included a Housing Market Index up to 52, well above last month’s 44 reading and an expected 45. Even better, the Empire State Manufactur...
ANR - Alpha Natural Resources, Inc. – Front month put options changing hands on coal producer, Alpha Natural Resources, Inc., this morning suggests some traders are positioning for shares in the name to extend losses, with the stock down roughly 8.0% to a six-month low of $5.50. Coal stocks are being pressured for a second consecutive session on news released Friday that Walter Energy pulled out of a $1.55 billion refinancing loan due to market conditions. Traders bracing for Alpha’s shares to continue to slide in the near term snappe...
This is very much like the fiscal cliff environment where one politico comes out and says one thing, and market rallies, and then another politico says something opposite an hour or day later and the market falls. Except this time its news agencies. What Hilsenrath giveth, the FT is taking away this afternoon. And with that the breakout that looked just fine 30 minutes ago is severely threatened.
Any securities mentioned on this page are not held by the author in his personal portfolio. Securities mentioned may or may not be held by the author in the...
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This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).
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Reminder: Craigzooka is available to chat with Members regarding his virtual portfolio performance, comments are found below each post.
I am going to share with you how I manage my IRA and the power of reducing your cost basis. My goal each year is a 20% return in my IRA. Sometimes I make it and sometimes I don't, but I believe that all of my success is due to reducing my cost basis. To illustrate the power of reducing your cost basis here are some trades we did last year. These trades are taken from an educational portfolio we ran in a paper-trading account for a little more than a year.
We bought RIG on 5/15/2012 for $44.13, sold it on 1/18/2013 for $46 but booked a profit of $1,154.
We bought MT on 1/4/2012 for $19.24, sold it on 12/21/2012 for $15 but booked a profit of $454.
We bought CHK on 1/27/2012 for $21.93, sold it on 10/19/2012 for $18 b...
Stock market posts another record setting week, but the big news came after Friday’s close.
Courtesy of NASA
The stock market put on another record setting show with the Dow Jones Industrial Average (NYSEARCA:DIA) closing at a record high 15,118 and the S&P 500 (NYSEARCA:SPY) closing at 1633.70, another all time closing high.
For the week, the Dow Jones Industrial Average (NYSEARCA:DIA) gained 1%, the S&P 500 (NYSEARCA:SPY) climbed 1.2%, the Nasdaq Composite (NYSEARCA:...
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Well, well, well....it is good to know that there are others in the scientific arena who believed that YMI Bioscience's data (cough - Gilead) is a better drug than Incyte's Jakafi. Now, the definitive data are still unknown, but there was enough evidence from a Phase 2 trial to take a small risk for a huge reward. So, let's forget about Apple (AAPL), and do nothing but biotechs from now until Congress passes universal health care coverage for prescriptions....and drive the prices down so that research and development is no longer feasible to conduct in the US. Even Seattle Genetics (SGEN) has been on a tear as of late...
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