Confidence indicator of the University of Michigan went up slightly from 92.1 to 93 – stocks and dollar can rally, bonds fall
Alan Hershey
Dec. 3, 2006

The data in this week will most likely show that the confidence indicator of the University of Michigan went up slightly from 92.1 to 93. The fact that it is not sliding will provide the Fed hawks a pretext to stay the course. Fed is more concerned about the long-term inflation risk that the economic recession. The data this week will make them more confident.

The stocks can rally here. It will be one the last rally in stocks at these levels. Lower rates and the prospects that economy is having a soft landing will pull stocks up. The dollar can rally and bonds fall.

Confidence indicator of the University of Michigan went up slightly from 92.1 to 93 – stocks and dollar can rally, bonds fall
Alan Hershey
The data in this week will most likely show that the confidence indicator of the University of Michigan went up slightly from 92.1 to 93. The fact that it is not sliding will provide the Fed hawks a pretext to stay the course.
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Initial Jobless Claims reduced by 32,000 last week and 13,000 more new Nonfarm Jobs were created – bullish for dollar?
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The dollar bears had their day. This week they will cover their short positions, as data will show the job market did not deteriorate any further.
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ISM Non-Manufacturing data of 55 from 57.1 will point out the economy is not that weak
Joe Weinman
The market will do everything imaginable to get a two or three rate hikes. The ISM manufacturing data showed there was a contraction last month after three years. But the ISM service data will show relative strength.
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A sharp drop in factory orders from lack of demand in real estate sector will not be enough to scare the Fed
Peter Oberois
. The factory orders are expected to plummet with a fall of 4.2% compared to a 2.1% rise last month. But that will not be enough to calm down the inflation hawks in the Fed.
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Higher productivity and lower labor init cost will boost the equity market and pull gold down
Sam Adelton
The third quarter productivity will be 0.4% from the prior data of 0.0%. The unit labor cost is expected to be rise 3.3% down from 3.8% in the prior data.The stock market has its structural problems but this data for the time being will be bullish.
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The Wall Street is now controlled by a handful major hedge funds – the lack of organic liquidity is a major concern
Marla Guthrie
If Dow goes back to 1700 in the next four years, the misery and suffering among the common people will be enormous. The Enron scam will look like a baby.
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How far can pound sterling go as U.K. Consumer Bankruptcies Soar as Loans, Card Debt Top $6,800 a Person
Peter Oberois
The biggest question is how far can the pound sterling go against the dollar? It is at 1.97 $ per pound – historically very high. Given the consumer debt burden and the current economic state of UK, is that high valuation of pound reasonable?
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The stealth bear market in gold is a sign of future crash of worldwide stock market due to deflationary forces
Sam Adelton
Gold topped out at $725 an ounce or 564.84 euro. Since then due to collapse in dollar, it just 10% shy of reaching the high in May, 2006. However, in terms of euro it is 18% short of reaching the same high.
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