Weekly Wrap

I don't know what I'm more addicted to. Temptation Island, The Mole, or Survivor. All three dramas held my undivided attention this week and everywhere I went, they were the topic of discussion. I have no idea what has happened to me since I finished writing the book. I sit in front of the TV for hours. just staring. The other night, I was watching The Mole and when it ended, I didn't move. I was frozen in my seat. The TV rolled right over into Dharma and Greg, and I watched it. I have never watched Dharma and Greg in my life, and there I sat. I didn't put the kids the bed, I didn't wash my face, and I didn't even brush my teeth. All of the sudden it was 11 PM, and I hadn't moved for two hours. Come to find out, I'm not the only one watching a ton of TV lately. Maybe it's because it's a lot better than watching the market.

This past week the Nasdaq dropped 6.4%, the S&P lost 0.9% and the Dow gained 0.2%. How fun is that? Television executives have never had it better. Make up a show, any show, throw it into the homes of depressed Americans, and you have yourself a Nielsen rating's winner. Matter of fact, anything is better than watching Alan Greenspan get pummeled on Capitol Hill.

Yep, today Federal Reserve Chairman Alan Greenspan spoke again to the House Budge Committee and vehemently denied that he waited too long to cut interest rates. "Had we moved sooner," he said, "We would have threatened the adjustment period." Excuse me? This little so-called recession is what you were waiting for, Al? It was heated up there on the Hill and if it were a Hollywood eight-week drama series, I'd probably watch it too.

Greenspan still refuses to fess up to the "Big R" word, but according to Cisco's CEO John Chambers, "It makes no difference what the Federal Reserve or the latest statistics say. What we see now is absolutely not a soft landing. Ask anyone in American manufacturing industry and they will say that we are in a recession," Chambers said. The Chick-held stock Cisco (CSSO) hit a 52-week low this week touching the $21.90 mark. But wait, it gets worse.

Oh Oracle, Oh Oracle, How ugly are your earnings. (Sing to the tune of Oh Tannenbaum)

Oracle (ORCL) took a branch beating this week, as they had to lower their earnings expectations for the latest quarter. They will miss their projections by 2 cents a share and cited the slowing economy as the reason. Their stock hit a new fifty-two week low on Friday, losing 21% of its value. Oh Oracle, Oh Oracle, How horrid can my life get?

Oh EMC, Oh EMC, Why must you follow Oracle? Need I say more? EMC (EMC) also lowered their earnings expectations for next quarter. Enough said on the other Chick-held company.

Also in the tech world, JDS Uniphase (JDSU) announced this week that they would cut 3,000 jobs worldwide. They were forced to do this in order to bring their employee count in line with their financial projections. Oh JDS, Oh JDS, I'm so-o tired of this tune.

I went to see the Bare Naked Ladies this week, the same week that the Gap (GPS) announced that they're pretty much running around in the nude. They issued a first quarter earnings warning, citing a weak sales trend. (Meaning that no one is buying clothes.) Their stock dropped 8.7% on Friday and dragged down Abercrombie and Fitch Co (ANF) and American Eagle Outfitters Inc. (AEOS) with it. I begged the Bare Naked Ladies to sing "Oh Gap-enbomb, Oh Gap-enbomb", but they didn't find any humor in it. Well, they can just take their Kraft Dinner and million dollars and, well, it has something to do with Greenspan's butt.

I saw something today that kind of lifted my spirits so I'm going to share it with you. Rarely do I even pay attention to market strategists, but when you're grasping for air, you'll listen to anything. Chief Strategist at AG Edwards said today that 'buying opportunities' like this only come along once every ten years. He also said he hasn't seen values like this since the summer of 1990. Hmmmm... when I relayed this to another "strategist" friend of mine, he too said that this market is similar to what happened in the early 90's. He also said that the years that followed were spectacular so I shouldn't give up hope. (I didn't give up hope, I said I was just tired of the tune.)

Speaking of buying, the Chicks are going to be voting on what stock to buy this next week. Should we buy a new stock, or reinvest in one that we already own. We have it down to a few companies that meet the Chick Dozen, but seeing that two of our strongest companies look to be such a bargain right now, we may decide to reinvest. Follow our own Chicks Twelve Week Drama which will come to a climax Sunday night on the Chicks message board.

A couple of newsworthy items this week.Napster is still hanging by a note as they made a last minute plea in U.S. District Court on Friday. They proposed new software that would block users from swapping copyrighted music with other users around the world. They are going to police themselves, they say. This seems to satisfy the music industry at the moment, but they still need an injunction in order to stay in business.

One more piece of info I found exciting, though the market didn't respond as eagerly as I did, was that Disney (DIS) and Coke (KO) are teaming up to market children's beverages! Yep, Coca-Cola's Minute Maid division is going to produce juices, punches, milk-based drinks and smoothies featuring Disney characters! Brilliant, M-I-C-K-E-Y! Why? Because, we'll like them.

I was so disappointed that Mike was burned off Survivor. I thought he was going to be a winner. But then again, there have been a lot of winners this past week that have ended up getting burned. It's the nature of the game. Stay tuned, I hear Mike is supposed to be coming back.

Until next week, I'll be in front of my TV.

Chick Karin

Closing Market Numbers