S&P 500 FINANCIALS INDEX
| Value 170.27 | Change -5.57 | % Change -3.2% |
MLPs were down fractionally while the REIT Index fell 3. Barclays Capital High Yield Bond ETF was up 2%, but many junk bond funds slipped a little. VIX was up fractionally.
The clock keeps ticking for GM as the end of month nears. I added the long run chart to show how far the stock has fallen. Citigroup (C), another Dow stock that trades like a call, has a similar long term chart, chilling to look at:
•GM Says Probability of Bankruptcy Filing Is Growing as Deadline Approaches
General Motors --- 38 years
Citigroup ---- 38 years
Dreary news is not confined to the US. In the 2nd largest economy in the world, Japan, Toyota, now the largest auto maker in the world, is forecasting the loss for this fiscal year will top $5B (about 20% larger than the loss in the prior year). They slashed (for the first time) the semi annual div from 75¥ to 35¥. The chart for their US shares shows a stock that has held up pretty well, at least so far.
Toyota Falls on Dividend Cut, Second Loss Forecast
Toyota ---- 36 years
Microsoft (MSFT), another Dow stock, will sell bonds for the first time in its history! The money will be used to help finance its $40B stock repurchase program, they are putting their money where their mouth is to buy what they see as stock at a cheap price. The stock is at levels not seen since 1998, but their business model has fundamental problems trying to selling more Windows & Office.
•Microsoft to Sell Debt for First Time Ever, Fund $40 Billion Share Buyback
Microsoft ---- 23 years
The White House was widened the budget deficit forecast for this fiscal year ending Sep 30, to an whopper $1.84T. Since most mortals can not comprehend such a number, it looks like this:
$1,8000,000,000,000
By way of comparison, critics of Bush like to point to his largest deficit which was (only) $½T or less than 1/3 the size of this one.
A rest period is long overdo for the markets.
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