The most likely scenario is that the markets will begin to rise from here -- and that bounce is just beginning to take hold.
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Forget about Operation Twist. Next week's bond auction has the most potential to disrupt the markets.
Wish we were on a gold standard? Think again.
When you post any thoughts about gold, you're inevitably going to end up with some folks who bring up the currency issue. "Gold is a currency," they say. "Gold has been favored since the time T-Rex ruled supreme (the dinosaur, not the band)." And of course, "Gold is going up because our fiat money is being debased and rational people are doing the only thing that makes any sense by buying yellow metal."
One commenter, for instance, posited: "Gold is trading as a currency. Yes it could be somewhat overvalued today, and may fall back, but in 12 months it will be up against all fiat currencies that are clearly being devalued."
But here's the problem: If gold is acting like a currency, it's acting like a really, really bad one.
Amazon is finally making e-books for its Kindle reader available at libraries across the country.
Barnes & Noble (BKS) worked out a similar partnership for its Nook reader a long time ago, but Kindle users have been left out of the library loop. The deal won't immediately help Amazon's business, but it may eventually entice more people to buy the device if they can borrow books on it for free.
Here's how it works:
With Congress gridlocked, the central bank acts to keep the economic recovery on track.
The wait is over. Federal Reserve policymakers announced Wednesday that they are ready and willing to support the flagging economic recovery with another dose of monetary policy support.
Specifically, they will more directly target long-term interest rates by shifting the average maturity of the Fed's bond holdings by buying $400 billion worth of Treasury bonds with maturities over six years while selling an equal number of Treasury bills with maturities of three years or less. The move has been dubbed Operation Twist in honor of a similar action taken in the 1960s.
Essentially, they are taking money out of their left pocket and putting into the right, but the impact will still be positive, since it will push down the interest rates that price mortgage loans, car loans and other consumer credit.
Here's why the Fed did the right thing -- and what to expect next.
Solid reports from the software makers show companies are starting to spend more.
That's the takeaway after strong earnings reports this week from Oracle (ORCL) and Adobe (ADBE). The companies specialize in business software, and both said sales and profit are doing better than analysts expected.
Investors cheered the news, sending shares of both companies up Wednesday. Oracle's share price spiked nearly 8% to $30.52, and Adobe saw shares rise more than 3% to $25.49.
Growth-correlated industries like steel, coal and timber could be attractive to aggressive investors if the global economy rebounds.
By Don Dion, TheStreet
The tumultuous action of past few weeks has weighed heavily on investors of all risk tolerances. But while euro concerns and other macroeconomic issues will likely keep many from attempting to reenter the global marketplace, some may be ready to bet on strength.
If the developed market can get itself back on the healing path and emerging countries can return to strength, growth-correlated industries such as coal, steel and timber could be attractive destinations for aggressive investors.
With ETFs, it is possible to gain concentrated exposure to these market slices.
Amid several key warning signs, risk is high for new buying.
By Tom Aspray, MoneyShow.com
Stocks gave up their early gains on Tuesday, and the reversal was the most pronounced in the tech-heavy Nasdaq Composite.
The stock index futures are lower in early trading Wednesday, and the markets may be quiet going into the widely anticipated Federal Open Market Committee (FOMC) announcement.
Overseas markets were mostly lower, and the short-term technical studies do suggest that the rally has stalled.
With no one willing to lend to the biggest French banks, we'll remain in a bizarre standoff with them until we get some sort of government action.
Sure, Italian banks are really bad. Spanish banks? No, thanks. But it is these three French banks that the world seems to want to break. These three banks are the ones everyone is whispering, "Don't lend to."
These three -- which are pretty much like JPMorgan (JPM), Bank of America (BAC) and Wells Fargo (WFC) in terms of importance to France but feel more like Lehman, Bear and Countrywide (or Citigroup, Wachovia and Washington Mutual, name your poisoned bank) -- are holding us hostage right now.
They will keep holding us hostage until we get some sort of government action, because of their lack of transparency about what they own, how much they are lending against collateral (are they lending 40-1 against Greek bonds?) and how they are valuing sovereign bonds.
These are the biggest names in the streaming-video rumble, and they could start stealing Netflix customers soon.
Over the past few years, streaming video has been the hottest growth segment in entertainment -- and Netflix (NFLX) has been the undisputed champion. Shares went from $30 in early 2008 to more than $300 in July. Its total subscriber base topped 25 million at the peak.
But this summer, that massive growth hit a wall. Netflix announced it was effectively doubling subscription fees and spinning off its DVD rental business into a new subsidiary. Now it's lost 1 million subscribers during the past two months. Shares went from more than $300 to just $131. For the first time, it seems, there is blood in the streaming-video waters.
So who is ready to gobble up Netflix's market share and transform streaming into a competitive field?
Why is the most valuable company in the US so noticeably absent from the index?
But there's one glaring absence: Apple (AAPL). The most valuable company in the U.S. is missing from the list and probably won't be allowed into the club anytime soon.
Why? Because Apple's share price is too high.
With members quickly dropping the service and the stock taking a huge dive, CEO Reed Hastings tried to fix things with an apology. It's not working.
By Seth Jayson
Like many others, I took a shameful pleasure in watching Netflix (NFLX) CEO Reed Hastings' sad-yet-hilarious bungling of yet another major service change. Not satisfied with its recent, customer-alienating moves of jacking up prices 30% to 60% on long-time members -- and reaping a big drop in membership along with a huge fall in stock price -- Netflix had, Hastings said, finally decided to make amends.
The peace offering? A long-winded explanation that the price increase was actually part of an even bigger company initiative, one that will split the subscriber experience in two. Hastings explained that the disc business will abandon a decade's worth of branding to rename itself the horrible "Qwikster," while the smaller streaming catalog will keep the Netflix brand. Best of all, and worst of all, the service site would be split in two!
Policymakers are set to announce Operation Twist. Here's what you need to know.
Late last month, all eyes were on Federal Reserve Chairman Ben Bernanke's speech at the Jackson Hole, Wyo., conference. A few weeks before, the Fed had announced its intention to keep interest rates near zero for two more years. And given the recent weakness in the economy and turmoil in capital markets, the hope was that he would repeat last year's performance and announce additional measures to support the recovery.
Last year, he teased what eventually became a $600 billion money-printing operation. The first such program was launched in late 2008 and significantly expanded in March 2009.
Instead of announcing something big, Bernanke postponed the decision one month until the Fed's September policy meeting, which was expanded to two days to allow a fuller discussion of policy options. Now that day of reckoning is upon us, with the Fed's statement due at 2:15 PM ET Wednesday.
Can Bernanke and the Fed satisfy Wall Street's desire for additional stimulus and get the recovery back on track?
The company plans to surprise people with the volume and variety of its supermarket products.
"In the next 12 to 18 months, we will be unveiling new products and entirely new categories," chief executive Howard Schultz told the German magazine Der Spiegel. "We're going to build a major multibillion-dollar business in the grocery industry for Starbucks, both domestically and around the world."
It's clear Starbucks isn't content to just stay in the beverage world. Prepare for some surprises, Schultz added. "I think people are going to be quite surprised over the next few years at what Starbucks is capable of doing," he said.
Adding Apple's iPhone to its lineup didn't do wonders for Verizon's per-user revenue.
A split of the European Union could bring about good buying opportunities in German equities.
By Tom Aspray, MoneyShow.com
Global markets seem to be factoring in a default by Greece, and many analysts are looking for a breakup of the European Union. Several analysts think we will end up with both a northern and southern Eurozone.
The overnight downgrade of Italy’s debt may add further pressure on the European Union, as Italy’s debt costs initially increased. Though I personally do not believe we will see a breakup of the European Union in the financial markets, anything is possible. Germany’s economy is in the best position to take advantage of a breakup and a new German deutschemark should have considerable investor appeal.
For those who are pessimistic about the fate of the European Union, an investment in a German company, ETF, or closed-end fund should make you well positioned.
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[BRIEFING.COM] S&P futures vs fair value: -0.40. Nasdaq futures vs fair value: -11.00. The stock market is on track to begin the final trading day of the holiday-shortened week on a subdued note. The S&P 500 futures trade right in line with fair value, while Nasdaq futures lag (-11 versus fair value) as Google (GOOG 553.64, -10.26) weighs after reporting below-consensus quarterly results.
Google notwithstanding, participants have received a full slate of quarterly ... More
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