Cashin’s Comments October 11, 2012Page 3 of 4
To celebrate have a jagermeister or two at the Pre Fuhrer Lounge and try to explain that for over half a century America'strauma has been depression-era unemployment while Germany's trauma has been runaway inflation. But drink fast, priceschange radically after happy hour. And, tell Fed. Chairman Bernanke that it was the “German Experience” that causedmany folks to raise an eyebrow when he alluded to the power of the “printing press” a few years ago. It is why so many,including some of the FOMC, express concern about unintended consequences of each new wave of quantitative easing.(And, if you think no government would ever sponsor wild inflation to liquidate its debt, take a look at Zimbabwe.)
Negative Guidance And Lingering European Concerns Weigh On Stocks
– Earnings season began with okay resultsbut they all came attached to rather dour outlooks for the U.S. and global economies. Alcoa cautioned on the world andCummins cautioned on North America. In New York, stocks opened down and worked steadily lower over the course ofthe session as European markets weighed on things again. Interestingly, that did not drive the Euro much lower, but you'dnever know it by the dip in stocks and other assets.Angela Merkel left Athens and tear gas was replaced by sunshine, so, naturally the Greek market plunged the equivalent of500 points in the Dow. The losses elsewhere in Europe were only a fraction of that damage.Jim Bianco even popped up with a thesis that the recent selloff was related to the Romney surge. He says a Romney winmeans no more Bernanke and that means no more punchbowl. Interesting, but I don't see it in the bond market.Anyway, stocks in the U.S. closed near the day's lows on slightly smaller volume.
– Tonight's Vice Presidential debate naturally called up recollections of prior ones. Almost everycommentator zeros in on the knockout zinger by Lloyd Bentsen on Dan Quayle – "Senator, I served with Jack Kennedy. Iknew Jack Kennedy. Jack Kennedy was a friend of mine. Senator, you're no Jack Kennedy." Perfectly structured andeffective. But no commentators recall that further research found it wasn't true. They were not friends. They barely kneweach other, if at all. One report claimed they met only once. Yet the line lives on.
Cocktail Napkin Charting
– The S&P held above the 1428/1431 support line. For today, napkins see support again at1428/1431 then 1419/1422 and 1408/1411. Resistance looks like 1438/1441 then 1446/1449 and 1454/1457.
– Europe initially shrugs off downgrade of Spain. Claims may set tone as earnings play out. Bulls need toregroup. Stay very nimble.
Answer - The odds that only three letters were in the right envelopes were: zero. If three were right, the fourth had to beright. (And, Jamie points out she never makes those kinds of mistakes.)Today's Question - How many eyes on all the jacks in a deck of cards?
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