Dow fell 66, decliners over advancers 3-1 & NAZ fell 32. Bank stocks led the sell-off, with the Financial Index down almost 2½ to 169.
The MLP index fell 1+ to the 372s & the REIT index was off 2½ to the 217s. Junk bond funds were flattish but Treasuries rose after a successful auction for 10 year bonds. Oil pulled back from AM highs after the US navy said the Straits of Hormuz would remain open for ships carrying oil. In PM trading, gold took another tumble. In these trying times with the European debt mess, gold, the ultimate safe have, has not benefited.
![Live 24 hours gold chart [Kitco Inc.]](http://www.kitco.com/images/live/gold.gif)
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The Federal Reserve (FED) pointed to turmoil in Europe as a big risk to the economy, leaving the door open to a further easing of monetary policy even as it noted improvement in the labor market. The FED characterized the economy as expanding moderately despite an apparent slowing in global growth, & said that while there had been "some" improvement in the job market, unemployment remained elevated & housing depressed. "Strains in global financial markets continue to pose significant downside risks to the economic outlook," the FED said, alluding in a post-meeting statement to pressures stemming from the debt crisis in the euro zone. The FED statement was little changed from the announcement it released after its last gathering in early Nov, & only touched lightly on apparent improvements in the economy's performance. That neutral statement was what was expected by the markets.
Fed: U.S. Economy ‘Expanding Moderately’; Policy Unchanged
Federal Open Market Committee Dec. 13 Policy Meeting Statement (Full Text)
The MLP index fell 1+ to the 372s & the REIT index was off 2½ to the 217s. Junk bond funds were flattish but Treasuries rose after a successful auction for 10 year bonds. Oil pulled back from AM highs after the US navy said the Straits of Hormuz would remain open for ships carrying oil. In PM trading, gold took another tumble. In these trying times with the European debt mess, gold, the ultimate safe have, has not benefited.
AMZ Alerian MLP Index
DJR Dow Jones Equity REIT Index
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Treasury yields:
U.S. 3-month | 0.005% | |
U.S. 2-year | 0.230% | |
U.S. 10-year | 1.962% |
| CLF12.NYM | ...Crude Oil Jan 12 | ...99.82 .... |  2.05 (2.1%) |
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The Federal Reserve (FED) pointed to turmoil in Europe as a big risk to the economy, leaving the door open to a further easing of monetary policy even as it noted improvement in the labor market. The FED characterized the economy as expanding moderately despite an apparent slowing in global growth, & said that while there had been "some" improvement in the job market, unemployment remained elevated & housing depressed. "Strains in global financial markets continue to pose significant downside risks to the economic outlook," the FED said, alluding in a post-meeting statement to pressures stemming from the debt crisis in the euro zone. The FED statement was little changed from the announcement it released after its last gathering in early Nov, & only touched lightly on apparent improvements in the economy's performance. That neutral statement was what was expected by the markets.
Fed: U.S. Economy ‘Expanding Moderately’; Policy Unchanged
Federal Open Market Committee Dec. 13 Policy Meeting Statement (Full Text)
Treasuries gained after the sale of $21B in 10-year notes attracted higher-than-average demand. The securities drew a yield of 2.02%, compared with a forecast of 2.05%. The bid-to-cover ratio was 3.53X, the strongest since in 8 months. The yield on the current 10-year note fell 3 basis points to 1.99% after rising to a high of 2.06% earlier. The 30 year bond yield decreased 2 basis points to 3.04% after advancing earlier to 3.1%. Especially with the turmoil in the European debt markets & on certainties about rate cuts, demand continues strong for US AA+ debt.
Treasuries Advance After $21 Billion 10-Year Auction Draws Strong Demand
Greece has reached its limit in raising taxes & needs to refocus its austerity program on long-term spending cuts according to the IMF. The warning came as Greece heads toward its 4th year of recession, with revenues weakening despite draconian new emergency taxes. "I think one of the things we have seen in 2011 is that we have reached the limit of what can be achieved through increasing taxes," Poul Thomsen, the IMF mission chief in Greece, said. He added that the country's structural reforms have fallen "well short" of expectations but it was too early to say whether new austerity measures would have to be taken next year. Since the €110B ($145B) bailout loan package agreed to in May 2010, it has taken debt-reducing measures, including slashing salaries & pensions & imposing several rounds of tax hikes. Greece's austerity program "has relied, in our view, too much on taxes and I think one of the things we have seen in 2011 is that we have reached the limit of what can be achieved through increasing taxes," Thomsen said. "Any further measures, if needed, should be on the expenditure side." Bottom line, Greek remains a mess with massive gov borrowings.
IMF: Greece can't tax its people any further AP
Jive Software, maker of Facebook-type social networks for businesses, soared in its public debut after the company priced its IPO above expectations to raise $161M. Zynga, maker of online games played mostly on Facebook, is expected to go public later this week. Facebook's own IPO isn't expected until after Apr, but it could dwarf even the Google (GOOG) 2004 IPO debut, fetching as much as $10B. The IPO price for JIVE was $12 & it closed up $3.05 at $15.05. That stock price values the company at $891M. JIVE creates websites & other tools for companies looking for better ways to share information among their employees, customers & partners. Some of its tools plug into the dialogue on Facebook & Twitter.
Jive Software shares soar in public debut AP
No magical gifts for investors from the FED today. Being real, there is not a lot it can do as long as the GDP growth gets sort of a passing grade. What good will another bond buying program do to help this sluggish recovery? We're almost half way thru Dec & Dow is down about 100. Dec will probably continue the dreary trend for stocks in 2011.
Dow Jones Industrial Average
Treasuries Advance After $21 Billion 10-Year Auction Draws Strong Demand
Greece has reached its limit in raising taxes & needs to refocus its austerity program on long-term spending cuts according to the IMF. The warning came as Greece heads toward its 4th year of recession, with revenues weakening despite draconian new emergency taxes. "I think one of the things we have seen in 2011 is that we have reached the limit of what can be achieved through increasing taxes," Poul Thomsen, the IMF mission chief in Greece, said. He added that the country's structural reforms have fallen "well short" of expectations but it was too early to say whether new austerity measures would have to be taken next year. Since the €110B ($145B) bailout loan package agreed to in May 2010, it has taken debt-reducing measures, including slashing salaries & pensions & imposing several rounds of tax hikes. Greece's austerity program "has relied, in our view, too much on taxes and I think one of the things we have seen in 2011 is that we have reached the limit of what can be achieved through increasing taxes," Thomsen said. "Any further measures, if needed, should be on the expenditure side." Bottom line, Greek remains a mess with massive gov borrowings.
IMF: Greece can't tax its people any further AP
Jive Software, maker of Facebook-type social networks for businesses, soared in its public debut after the company priced its IPO above expectations to raise $161M. Zynga, maker of online games played mostly on Facebook, is expected to go public later this week. Facebook's own IPO isn't expected until after Apr, but it could dwarf even the Google (GOOG) 2004 IPO debut, fetching as much as $10B. The IPO price for JIVE was $12 & it closed up $3.05 at $15.05. That stock price values the company at $891M. JIVE creates websites & other tools for companies looking for better ways to share information among their employees, customers & partners. Some of its tools plug into the dialogue on Facebook & Twitter.
Jive Software shares soar in public debut AP
JIVE Jive Software
No magical gifts for investors from the FED today. Being real, there is not a lot it can do as long as the GDP growth gets sort of a passing grade. What good will another bond buying program do to help this sluggish recovery? We're almost half way thru Dec & Dow is down about 100. Dec will probably continue the dreary trend for stocks in 2011.
Dow Jones Industrial Average
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