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Floyd E. Miller Presents: Weekly Economic Update for November 19, 2012

Floyd E. Miller Presents: Weekly Economic Update for November 19, 2012

By Floyd Miller

 

 

 

A FISCAL CLIFF DEAL SOONER RATHER THANLATER? HouseSpeaker John Boehner and Senate Majority Leader Harry Reid both called Friday’sfiscal cliff meeting with President Obama and the White House economic team”constructive”. Speaker Boehner noted that he had introduced a framework fortax reform, adding that tax increases might be accepted if “accompanied byserious spending cuts”. President Obama is in Asia this week; members of his seniorteam will continue talks with leaders of Congress. House Minority Leader NancyPelosi urged lawmakers to set “a deadline before Christmas” to resolve thedilemma, emphasizing the need to “send a message of confidence to consumers[and] the markets” in the coming weeks. Friday, the Wall Street Journal published reports of “advanced talks” at theWhite House about a deal to postpone January’s planned $100 billion in spendingcuts for 6-12 months while smaller and more targeted cuts and tax increases aremade in the interim.1,2   DID SUPERSTORM SANDY DENT RETAIL SALES? Thestorm may have had an effect. The Commerce Department noted a 0.3% overall dropin retail purchases for October, with core retail sales down 0.1%. This followsa 1.3% gain for September and a 1.0% advance in August.3 {{more}}   TAME INFLATIONIN OCTOBER Consumerprices ticked up but 0.1% last month, compared to 0.6% in September. Wholesaleinflation lessened for the first time in five months in October; the ProducerPrice Index retreated 0.2% after rising 1.1% in the prior month. Annualconsumer inflation was running at 2.2% in October.4 STOCKS MOVE SOUTH TheDow lost 1.77% last week, while the NASDAQ and S&P 500 respectively lost1.78% and 1.45%. On Friday, the Dow closed at 12,588.31, the NASDAQ at 2,853.13and the S&P at 1,359.88. COMEX gold settled Friday at $1,712.30 per ounce;NYMEX crude ended the trading week at just $86.62 a barrel.5,6,7 THIS WEEK: Monday,earnings from Lowe’s, Jack in the Box, Tyson Foods and Urban Outfitters arereleased, plus NAR’s report on existing home sales. Tuesday, data on Octoberhousing starts arrives along with Q3 results from Hewlett-Packard, Best Buy,Chico’s and Campbell Soup; Fed Chairman Ben Bernanke speaks at the Economic Clubof New York. November’s final University of Michigan consumer sentiment surveyarrives Wednesday, and so do the latest initial jobless claims. Thanksgiving isThursday; U.S. financial markets will be closed. Black Friday follows, with theNYSE closing for business at 1:00pm EST. % CHANGE Y-T-D 1-YR CHG 5-YR AVG 10-YR AVG DJIA +3.03 +5.73 -0.89 +4.67 NASDAQ +9.52 +8.09 +1.64 +10.22 S&P 500 +8.13 +9.94 -1.36 +4.95 REAL YIELD 11/16 RATE 1 YR AGO 5 YRS AGO 10 YRS AGO 10 YR TIPS -0.81% 0.05% 1.80% 3.10% Sources: cnbc.com, bigcharts.com, treasury.gov, treasurydirect.gov- 11/16/125,8,9,10 Indices are unmanaged, do notincur fees or expenses, and cannot be invested into directly. These returns do not includedividends. «RepresentativeDisclosure» This material was prepared byMarketingLibrary.Net Inc., and does not necessarily represent the views of thepresenting party, nor their affiliates. Marketing Library.Net Inc. is notaffiliated with any broker or brokerage firm that may be providing thisinformation to you. This information should not be construed as investment, taxor legal advice and may not be relied on for the purpose of avoiding anyFederal tax penalty. The Dow Jones Industrial Average is a price-weighted indexof 30 actively traded blue-chip stocks. The NASDAQ Composite Index is anunmanaged, market-weighted index of all over-the-counter common stocks tradedon the National Association of Securities Dealers Automated Quotation System.The Standard & Poor’s 500 is an unmanaged group of securitiesconsidered to be representative of the stock market in general. It is notpossible to invest directly in an index. NYSE Group, Inc. operatestwo securities exchanges: the New York Stock Exchange and NYSEArca . NYSE Group is a leading provider of securities listing, trading andmarket data products and services. The New York Mercantile Exchange, Inc. is the world’s largest physical commodity futures exchange and thepreeminent trading forum for energy and precious metals, with trading conductedthrough two divisions – the NYMEX Division, home to the energy, platinum, andpalladium markets, and the COMEX Division, on which all other metals trade.Additional risks are associated with international investing, such as currencyfluctuations, political and economic instability and differences in accountingstandards. All information is believed to be from reliable sources; however wemake no representation as to its completeness or accuracy. All economic andperformance data is historical and not indicative of future results. Marketindices discussed are unmanaged. Investors cannot invest in unmanaged indices.The publisher is not engaged in rendering legal, accounting or otherprofessional services. If assistance is needed, the reader is advised to engagethe services of a competent professional. Citations. 1 – whitehouse.blogs.cnn.com/2012/11/16/congressional-leaders-strike-postive-tone-after-constructive-white-house-meeting/[11/16/12] 2 – www.cnbc.com/id/49852886/ [11/16/12] 3 – blogs.wsj.com/economics/2012/11/14/worries-that-retail-weakness-extends-beyond-sandy/[11/14/12] 4 – www.bloomberg.com/news/2012-11-15/consumer-prices-in-u-s-increased-at-a-slower-pace-in-october.html[11/15/12] 5 – www.cnbc.com/id/49853571 [11/16/12] 6 – markets.on.nytimes.com/research/markets/commodities/commodities.asp[11/16/12] 7 – montoyaregistry.com/Financial-Market.aspx?financial-market=retirement-investment-funds&category=3[11/16/12] 8 -bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=11%2F16%2F11&x=0&y=0[11/16/12] 8 -bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=11%2F16%2F11&x=0&y=0[11/16/12] 8 -bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=11%2F16%2F11&x=0&y=0[11/16/12] 8 -bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=11%2F16%2F07&x=0&y=0[11/16/12] 8 -bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=11%2F16%2F07&x=0&y=0[11/16/12] 8 -bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=11%2F16%2F07&x=0&y=0[11/16/12] 8 -bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=11%2F15%2F02&x=0&y=0[11/16/12] 8 -bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=11%2F15%2F02&x=0&y=0[11/16/12] 8 -bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=11%2F15%2F02&x=0&y=0[11/16/12] 9 -treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield[11/16/12] 9 -treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll[11/16/12] 10 – treasurydirect.gov/instit/annceresult/press/preanre/2002/ofm71002.pdf[7/10/02]