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From: R. A. Christy
Editor/Publisher, ‘The Long and Short of
It’
President/CEO, Christy Investment Group
http://www.christyinvestments.com
Date: May 2, 2008
Long/Short
This week has been odd to say the least and I wanted to
touch base with everyone before heading out to do some weekend planting.
From the Intelligent Trader Blog: Wednesday
The Federal Reserve cut interest rates earlier today by
25bp to 2 percent, which was right in line with the expectations. The
gut feel that I had was a little off in that I thought rates would be
left unchanged.
Two Fed governors agreed with me in that they voted not
to cut rates. The final tally was 8-2. The US dollar dipped after the
announcement because traders were hoping for a larger cut. This is a buy
the rumor sell the fact scenario at its best.
A couple of things to make note here: (1) the decision to
cut was not unanimous and (2) the wording was a little different this
time around. The Fed took out their promise to act in a “timely manner”
and said that they will act as needed. The usual statement about the
downside risks to growth is also gone. This may be nothing more than
symbolism but it is worth noting.
Friday Morning May 2, 2008
A few months back, I commented that I was hearing that
oil producers might stop accepting US dollars as forms of payment for
oil purchases. This is really serious stuff and should not be taken
lightly by anyone, especially our representatives.
Here are two stories that I pulled off the wire today.
1. Official says Iran quits using US dollar for oil deals
By
ALI AKBAR DAREINI
The Associated Press
TEHRAN, Iran — Iran, OPEC's second-largest producer, has
stopped conducting oil transactions in U.S. dollars, a top Oil Ministry
official said Wednesday, a concerted attempt to reduce reliance on
Washington at a time of tension over Tehran's nuclear program and
suspected involvement in Iraq.
Iran has dramatically reduced dependence on the dollar
over the past year in the face of increasing U.S. pressure on its
financial system and the fall in the value of the American currency.
Oil is priced in U.S. dollars on the world market, and
the currency's depreciation has concerned producers because it has
contributed to rising crude prices and eroded the value of their dollar
reserves.
Read the rest of the story.
2. Iran steps up petro-dollar war with U.S.
Pressures falling greenback by demanding Japan buy oil in yen
Posted: August 02, 2007
1:00 am Eastern
By Jerome R. Corsi
© 2008 WorldNetDaily.com
Iran has intensified pressure on the falling U.S. dollar
by demanding that Japan begin paying for Iranian oil in yen, instead of
dollars.
Read the rest of the story.
In other news:
The U.S. lost fewer jobs than forecast in April, and
unemployment number came in better than expected.
Payrolls shrank by 20,000 workers, following a revised
81,000 drop in March that was larger than previously estimated, the
Labor Department said today in Washington. The jobless rate is now 5
percent, down from 5.1 percent in March.
Today's report also showed that income growth slowed last
month as the economy stalled. The economy's 0.6 percent expansion rate
over the six months through March was the weakest performance since the
U.S. was last in a recession in 2001.
Factory payrolls fell by 46,000 workers, Labor said. In
the construction industry, employers cut 61,000 jobs, the most since
February 2007.
Atlanta based Home Depot Inc., the world's biggest
home-improvement retailer, said May 1 it will close 15 stores and scrap
plans for 50 more because the U.S. housing slump is hurting sales. The
company will eliminate or move 1,300 jobs because of the closings.
This should come as no surprise to anyone who has been
walking around with their eyes open. Home Depot is in need of a makeover
and this should be a catalyst for change. It’s actually gotten to the
point where I will drive around until I find a Lowe’s. I won’t go into a
Home Depot unless I absolutely positively have to.
Federal Reserve policy makers this week lowered the
benchmark overnight lending rate between banks by a quarter percentage
point, to 2 percent, in a bid to revive the economy. The government also
started sending out tax rebate checks that were part of its fiscal
stimulus plan.
GDP Growth. The U.S. economy expanded at a 0.6 percent
annual pace in the first quarter, the Commerce Department said on April
30, as inventories increased because consumer spending slowed and
business investment dropped. The rise in stockpiles, along with smallest
gain in household spending in seven years, indicates the economy will
weaken further in coming months.
Berkshire Hathaway’s annual meeting is tomorrow and it
will be interesting to see what Warren Buffett has to say.
The market should do OK today, barring any political
misspeak from the Presidential candidates.
Also, just be glad your name isn’t Roger Clemens. His
fall from grace has been something to behold.
The Georgia High School baseball season is over and I am
taking the rest of the day off to catch up on some things that need to
be taken care of. I umpired 40 games this year (30 behind the plate) and
I am pretty banged up. My knees need a break.
Look for another update early next week.
That’s about it for now.
Robert Christy
The Intelligent Trader
PS. Despite the sub-prime sell-off, the credit crunch,
and high oil prices, The Intelligent Trader continued to deliver
outstanding profits for subscribers in 2007. In total, our entire
portfolio finished the year up better than 17% --that's more than 3
times better than the S&P 500 up only 5%. We're going into the second
quarter with even higher expectations-despite the risks most investors
will face in the months ahead. If you’re not yet a subscriber to our
Long/Short
Trading Service,
why not make an investment that’s sure help your bottom line.
P.S. Please fee
free to forward this to your peers, friends and associates you think
would benefit from its contents. They will thank you for it - and so
will I!
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Robert Christy is a professional stock
trader, money manager and author. Mr. Christy is the President CEO of
Christy Investment Group, Ltd., a registered investment advisory firm.
He is also the Managing Partner and Portfolio Manager of Plato Advisors,
LLC. At the time of publication, Mr. Christy may from time to time write
about stocks in which he, Christy Investment Group Ltd or Plato Advisors
LLC has a position. In such cases, appropriate disclosure is made.
Under no circumstances does the information in this column represent a
specific recommendation to buy or sell stocks. Mr. Christy appreciates
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rac@christyinvestments.com.
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