Weekly Wrap

Did you see who was one of the four Powerball winners last Saturday night? You should listen to me. It was a woman from Minnesota! She came forward on Monday and claimed her one-fourth of the $280 million!! Did you think it was I? Did you play the magic numbers that I told you to? 3, 9, 11, 20, 29... Powerball 1? Well, if you did, you would have come up with... nada. My lucky numbers were not lucky, and I was forced to spend the next couple of days watching all the winners from Kentucky, New Hampshire, Delaware and Minnesota go home with their $70 million before taxes. My lesson has been learned. I can now lose my fear of lightning.

Seems the chances of the Dow ever going below 10,000 again were between slim and none. But this week, it did just that. It hasn't gone below 10,000 since April and I thought we were out of the cave, but the flippin' bear won't go away. (Remember, a bear market goes down, a bull market goes up. We're stuck with a bear and have been for longer than I care to recall.) It happened when a government report came out saying that consumer spending was down for the month of July. (I wonder if they took into account the weather. I mean, they do in the winter so why not the summer? Who in their right mind even left their homes in July? And if you did, you were only buying fans, air conditioners, pop and beer. So take that, government report.)

Another reason the market took a little a step back into the cave was because Sun Microsystems (SUNW) also delivered some bad news. They warned that they would probably lose money this quarter due to a slowing demand for their product in both Europe and Japan. I guess we can't blame the weather on this one. Maybe a global fear of Sun?

Speaking of, did you see the study out this week about weather, sun and the stock market? Two guys, one from the University of Michigan and the other from Ohio State University did a sixteen-year study about how the sun affects the stock market. Overall, the market grew at an annual rate of 16%, but on a clear day, the annual growth rate was 24.8%, on cloudy days. a measly 8.7%. Seems the bear should get out of his depressing cave and see the light. I can't take much more. (I know there's a joke in here somewhere about the caveman, Mars and Venus, but I'm going to abstain.)

Charles Schwab (SCH) announced that they would be RIFF'n (my acronym for Reduction In Force) 2,400 more jobs. Not too long ago they RIFF'd 3,400 employees. This recent pink slippin' puts Chuck's employees at 25% less than he had at the start of the year. I have a feeling that Chuck would like to shoot the bear, as the market is Schwab's whole business.

Philip Morris' (MO) CEO, Geoffrey Bible, announced that he is going to resign next August at the mandatory retirement age of 65. Wow... life is just beginning at 65! Wouldn't you hate it if you had to quit working then? Maybe he'll just stay on board with the company to keep busy, like hang out and drink and smoke. He deserves it after holding the position successfully since 1994. The company will be on the hunt for a new Chief of the Marlboro Man and Miller Brewing company.

Remember a while ago I told you about Jack Welch stepping down as General Electric's (GE) CEO? (By the way, he was older than 65 and still doing a great job). One of the rejected successors (not a nice way to put it, but true), James McNerney, moved on over to the Minnesota based conglomerate, 3M. This past week he called up one of his old buddies at GE and gave him a new job over at 3M. The vice-president of finance at GE Lighting, Joe Harlan, could quite possibly be my neighbor soon as he is going to be the new vice- president of financial planning and analysis starting Tuesday! (I'll ask our Realtor Chick Lynn if there's been any action by 3M execs.)

Another Minnesota headquartered company is in the news this week. Target Corp. (TGT) is suing Kmart Corp. (KMT) in the battle of the Discount Corps. Seems Kmart had been running an advertising campaign called, "Dare to Compare" where they used other discount retailers' prices and compared them to their own. Only problem, they lied. They misrepresented prices on many products so that no matter what they advertised, it was always going to look like Kmart was cheaper. They soon dropped the advertising campaign, and started a new one this week. It's called, "BlueLight Always". The two retailers were in court today (Friday), so we'll have to wait to hear what happened in the War of the Retail Corps. Does anyone else have a hard time hearing Martha Stewart saying, "BlueLight Always, it's a Good Thing"?

I hope you all have a great Labor Day Weekend. We have one thing to look forward to.the bear won't be able to come out of his cave until Monday. The market is closed! Go spend some time at the fair, or with your family, or just catching the last of some summer rays. But remember - stay away from the Powerball, unless of course you're going to play 3, 9, 11, 20, 25... Powerball 1. Now there's a winner.

Karin

Closing Market Numbers