Hate to state the obvious, but Sandy dominated the headlines this week, certainly on the East Coast, but with national ramifications as well, particularly as it affected the election. Pres. Obama was operating in a highly visible “command role” regarding recovery efforts, campaigns were curtailed, and there will undoubtedly be issues with some polling places and the election process.
The markets ended the week essentially flat, giving up some decent gains on Friday in a somewhat mystifying session which had looked strong during the pre-market and very early trading. On the week, the SPX was up +0.2%, the Dow off -0.1%, and the Nasdaq -0.2%. Spot gold had its fourth straight losing week, down -2.1% and U.S. crude down -1.6%. Various reasons were given for the Friday turnaround: AAPL’s decline, weakness in certain commodities, election uncertainty, “too good” data (if you can believe that one as it relates to QE), and the dollar strength. Whatever the reason, it was a disappointing end to a very tough week for a lot of people.
Let’s jump right in with this week’s quotes.
“We jokingly said this morning (Wed.) that we may be the only place south of Midtown that has water, lights, and food.” –Newsday/AP, quoting NYSE EuroNext CEO Duncan Niederhauer, in what was surely meant as some mild humor in the face of a difficult situation, but which might not have played too well with displaced, flooded out, cold and hungry Lower Manhattanites. As you no doubt know, the NYSE was forced to close for two consecutive “weather days’ for the first time since the Blizzard of 1888.
“That Apple Management Bloodbath.” –Forbes, commenting on the departures of Scott Forstall, SVP for iOS and John Browett, head of retail. Way too many details to get into in this space but it seems Forstall was reportedly not ‘playing nicely’ in several instances and that Browett just seemed like a bad fit from the get-go. Another Forbes piece headlined “Apple’s Stock Below $580, What Is Next“, saying, “The stock has been under pressure since it unveiled its iPad Mini last week…with markets particularly concerned about the pricing.” Both pieces well worth reading, especially if you would like to learn about “skeumorphism”.
Marketwatch also with an aticle on Apple worth a look, saying, “In the last six weeks Apple has significantly revamped the bulk of its product line…perhaps leaving the stock without a clear catalyst in the months ahead.”
“Let Them Eat Cake!” –the New York Post’s outspoken Andrea Peyser on Bette Midler’s 2012 New York Restoration Project Halloween Benefit Gala, which had the appropriately named theme “A Season in Hell.” Peyser was jumping all over actress Debra Messing who dressed as Marie Antoinette, and added in outrage over the timing of the event, “The rich, the famous, and the narcissistic weren’t about to let a little weather event ruin their party.” (In some defense of Ms. Midler and the attendees, it was for a very good cause, helping in the upkeep of various parks and other sites in the city).
And speaking of outrage, Mayor Bloomberg’s torturously delayed decision to cancel the NYC Marathon caused a media uproar, as well it should have. The usually politically incorrect Don Imus weighed in by saying in effect on his radio program, “How is celebrating a victory by a runner from Kenya or somewhere like that going to help lift the spirits of New York City?” The serious arguments were rightfully over both the appropriateness and the resource issues of running such a race through the city’s ravaged boroughs, especially Staten Island.
In a joint statement by the Mayor’s office and the New York Road Runners, they finally relented late Friday afternoon, and said :
While holding the race would not require diverting resources from the recovery effort, it is clear that it has become a source of controversy and division.Staten Island’s Borough President James Molinaro was not happy with the rescue and support efforts for SI, where more than half of the city’s fatalities occurred. Molinaro was particulary upset with the American Red Cross, saying:
My advice to the people of Staten Island is: Do not donate to the American Red Cross. Let them get their money elsewhere.And New York State Governor Andrew Cuomo looked like a man setting up for a Presidential run, dominating the airwaves and fighting the good fight for New Yorkers in the recovery. The Village Voice headlined, “NY Gov Cuomo Appears To Be A Little Pissed Off”, speaking of his anger over the delays in restoring power. Cuomo sent a letter to multiple utility companies, which said in part:
If you failed to prepare, however, as evidenced by your response, it is a failure to keep your part of the bargain…such a failure constitutes a breach of the public trust.Gov. Christie of New Jersey faced many serious issues in his state, and called the damage “unthinkable”. Christie obviously has had a lot of emotional as well as pragmatic leadership comments over the past week, but two of the more noteworthy (CBSLocal):
South of I-195, 95% of gas stations are open and operating, North of I-195, only 25%. It is a tale of two states.In the face of all this tragedy, Donald Trump managed to keep promoting his silly “$5 million Obama Challenge”. Mark Cuban, according to Forbes, fired back, “Daring Trump To Shave His Head For $1 Million.”
It is heartbreaking to see our shoreline cut in half. You cannot recognize some places any more.
Back to a couple market headlines quickly:
“Bye-bye Dodd-Frank. Hello Comprehensive Tax Reform.” –MarketWatch on the prospects of a Republican-controlled Senate, which is by no means a lock at this point.
“Visa (V) Earnings Growth Outpaces Rival Mastercard (MA) Again”. –IBD, on V’s +15% revenue gains versus YAG versus MA’s +5%.
“Oil, Gas Prices Fall After U.S. Acts to Boost Supply.” –NBCNews.com, on the Washington “waiver” to allow foreign tankers to bring fuel to the East Coast. (Certainly a little counterintuitive price action in the face of all the news on gas shortages in NY and NJ.)
“Did Disney (DIS) Buy Lucasfilm For the Wrong Reasons?” –CBR.com, with a pretty provocative thought:
Yes, there is life and profit left in exploiting creations that came decades earlier, as Marvel/Avengers has proven…but, should Disney be looking at aggressively funding ‘new’ creators/storytellers versus things we have seen since childhood?“Gold Bugs Scatter Like Roaches.” –StreetInsider.com, on the “collapse of spot gold below $1700/oz.”
Let’s leave it there for this week as most market-watchers will be turning mostly away from Sandy’s effects for a bit to the election on Tuesday. RealClearPolitics.com was saying “Most national polls show Obama and Romney in a dead heat nationally, although Obama appears to be leading for n0w in 8 of 11 swing states.” (Of course the situation is in flux as the campaigns will have a furious closing couple days; but this latest polling summary on the site had Obama at 47.5% in the popular vote and Romney at 47.3%).
Several observers are commenting on the potential for a very late evening or even next day call on the election, the definite possibility of “hanging chad”-type protests over a variety of issues, and polling place confusion in the wake of Sandy.
Perhaps NBC’s Jay Leno said it best, and thanks to Barron’s for pointing this out in this weekend’s edition:
Experts say the entire 2012 election could come down to just eight states: confusion, dismay, depression, apathy, shock, disbelief, despair, and anxiety.
www.forbes.com
