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<p>The materials sector of the S&P 500 has struggled significantly in 2023, recording a 6.5% decline compared to a modest 0.7% increase for the market average, as indicated by the S&P 500. However, the recent announcement that <a href="http://today.reuters.com/investing/financeArticle.aspx?type=bondsNews&storyID=URI:urn:newsml:reuters.com:20051114:MTFH19206_2005-11-14_04-54-49_N13611733:1">Koch Industries is set to acquire Georgia-Pacific Corp.,</a> has renewed interest in this sector from Wall Street.</p> <footer class="entry-meta">
By James Picerno | <a href="https://www.capitalspectator.com/paper-assets/" title="10:05 am" rel="bookmark"><time class="entry-date" datetime="2005-11-15T10:05:21-05:00">November 15, 2005</time></a>
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<p>This week, the Federal Reserve has a packed schedule, featuring both prominent figures and those who typically operate in the background. As usual, discussions around the Fed often lead to speculation about interest rate movements, and this week promises to continue that trend.</p> <footer class="entry-meta">
By James Picerno | <a href="https://www.capitalspectator.com/the-week-ahead/" title="9:29 am" rel="bookmark"><time class="entry-date" datetime="2005-11-14T09:29:35-05:00">November 14, 2005</time></a>
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<p>Kevin Lansing, a senior economist at the Federal Reserve Bank of San Francisco, has expressed concern regarding consumer spending in his recent essay titled <a href="http://www.frbsf.org/publications/economics/letter/2005/el2005-30.html">“Spendthrift Nation.”</a> He highlights the alarming trend of decreasing savings, noting that in September 2005, the personal savings rate was negative for the fourth straight month. “A negative savings rate indicates that consumers are spending more than their available post-tax income,” Lansing stated. Given the long-standing trend of declining savings over the past two decades, one has to wonder why the alarm is being raised now. Lansing elaborates on his insights in his essay, available in the <a href="https://www.capitalspectator.com/wp-content/uploads/research.html">Research Room.</a> For those concerned about consumer spending sustainability, his commentary offers food for thought.</p>
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By James Picerno | <a href="https://www.capitalspectator.com/research-room-update-the-dearth-of-savings-again/" title="9:51 am" rel="bookmark"><time class="entry-date" datetime="2005-11-11T09:51:34-05:00">November 11, 2005</time></a>
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<p>The United States lacks a coherent energy policy, yet the government remains active in oil and gas matters. Recent actions include <a href="http://www.chron.com/cs/CDA/ssistory.mpl/business/energy/3451197">criticizing oil companies for high crude prices</a> and <a href="http://www.bloomberg.com/apps/news?pid=10000103&sid=ampp_7U682C0&refer=us">rejecting proposals to drill in Alaska,</a> which could have accessed the nation’s largest untapped oil reserves. This marks a rather stagnant approach to energy issues in 21st-century America.</p> <footer class="entry-meta">
By James Picerno | <a href="https://www.capitalspectator.com/strategic-thinking-takes-a-holiday/" title="11:22 am" rel="bookmark"><time class="entry-date" datetime="2005-11-10T11:22:53-05:00">November 10, 2005</time></a>
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<p><i>MONTH-TO-DATE PERFORMANCE THROUGH NOVEMBER 8<br />(Ranked in descending order)</i><br /><b>Capitalization/Style (total returns)</b><br />Russell 2000 Growth Index 1.99% <span><br />Russell Midcap Growth Index 1.73 <span><br />Russell 2000 Index 1.52<br />Russell Microcap Index 1.5<br />Russell 1000 Growth Index 1.35 <span><br />Russell 1000 Index 1.07<br />Russell 2000 Value Index 1.05 <span><br />Russell Midcap Index 0.95<br />Russell 1000 Value Index 0.8 <span><br />Russell Midcap Value Index 0.22<br /><b>S&P 500 Sectors (total returns)</b><br />Information Technology 2.53% <span><br />Consumer Discretionary 1.73 <span><br />Financials 0.99<br />Industrials 0.92<br />Energy 0.82 <span><br />Materials 0.74</span><br />Health Care 0.49<br />Telecommunications Services 0.42<br />Consumer Staples -0.24<br />Utilities -2.14 <span><br />* * *<br />S&P Equity REIT 2.1% <span><br />* * *<br />S&P 500 0.96<br /><b>International (price change, in US$)</b><br />MSCI JAPAN 3.2% <span><br />MSCI EMERGING MARKETS 3.0% <span><br />MSCI LATIN AMERICA 2.9%<br />MSCI EASTERN EUROPE 2.6%<br />MSCI PACIFIC 2.5%<br />MSCI CHINA 1.7%<br />MSCI EAFE 1.1%<br />MSCI EUROPE 0.4% <span><br />Sources: <a href="http://www.russell.com/us/indexes/us/default.asp">Frank Russell Co.,</a> <a href="http://www2.standardandpoors.com/servlet/Satellite?pagename=sp/Page/IndicesIndexPg&r=1&l=EN&b=4&f=1&s=6&ig=48&i=56&fd=&dt=08-NOV-2005&xcd=500&so=6">Standard & Poor’s,</a> and <a href="http://www.msci.com/equity/index2.html">MSCI</a></span></span></span></span></span></span></span></span></span></span></span></span>
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By James Picerno | <a href="https://www.capitalspectator.com/equity-index-scorecard/" title="10:02 am" rel="bookmark"><time class="entry-date" datetime="2005-11-09T10:02:58-05:00">November 9, 2005</time></a>
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<p>Big Oil is slated for a hearing in <a href="http://energy.senate.gov/public/index.cfm?FuseAction=PressReleases.Detail&PressRelease_id=234785&Month=11&Year=2005">the Senate tomorrow.</a> Expect heightened rhetoric and a flurry of accusations, though the actual outcomes remain uncertain.</p> <footer class="entry-meta">
By James Picerno | <a href="https://www.capitalspectator.com/crude-talk-in-the-senate/" title="9:55 am" rel="bookmark"><time class="entry-date" datetime="2005-11-08T09:55:48-05:00">November 8, 2005</time></a>
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<p>S&P 500 companies continue to impress with their earnings reports in 2005. However, a question arises: Will this positive trend continue into 2006? Rising interest rates inject uncertainty into the market, and it remains to be seen if the stock market can ignore this trend indefinitely. Additionally, the U.S. economy faces various challenges, including trade and budget deficits, alongside the transition to a new Federal Reserve chairman, following the retirement of Alan Greenspan.</p> <footer class="entry-meta">
By James Picerno | <a href="https://www.capitalspectator.com/deconstructing-sp-500-earnings/" title="8:57 am" rel="bookmark"><time class="entry-date" datetime="2005-11-07T08:57:58-05:00">November 7, 2005</time></a>
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<p>With retirement on the horizon, Alan Greenspan recently cautioned that deficits are a cause for concern. He described the persistent budget deficits as a “ticking time bomb.” Greenspan emphasized the importance of addressing these trends, as they could lead to significant economic disturbances if left unchecked. “I find it utterly inconceivable,” he remarked, “that ongoing budget deficits will not have a significant impact on long-term interest rates,” during his testimony in Congress, as reported by AP via <a href="http://www.businessweek.com/ap/financialnews/D8DL6QD8G.htm?campaign_id=apn_home_down&chan=db">BusinessWeek.</a></p> <footer class="entry-meta">
By James Picerno | <a href="https://www.capitalspectator.com/attitude-adjustment/" title="10:32 am" rel="bookmark"><time class="entry-date" datetime="2005-11-04T10:32:09-05:00">November 4, 2005</time></a>
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<p>BCA Research <a href="http://www.bcaresearch.com/public/story.asp?pre=PRE-20051101.GIF">predicted</a> on Tuesday that an economic slowdown is imminent. According to their analysis, the bond market will likely react to this downturn before the Federal Reserve is aware of the trend. “Bonds have already factored in a lot of recent hawkish statements from the Fed,” the researchers stated. They added that the selloff in the long end of the Treasury curve appears to be losing steam, with improved valuations and robust technical support likely near the March peak of 4.65%.</p> <footer class="entry-meta">
By James Picerno | <a href="https://www.capitalspectator.com/waiting-for-the-next-big-thing/" title="12:31 pm" rel="bookmark"><time class="entry-date" datetime="2005-11-03T12:31:20-05:00">November 3, 2005</time></a>
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<p>Yesterday, the Fed raised interest rates for the 12th consecutive time, increasing the Fed funds rate by 25 basis points to 4.0%. What lies ahead? More of the same, as expected. The central bank reassured stakeholders that “monetary policy adjustments will proceed at a measured pace.” This is central banking jargon indicating that the 25-basis point increases will likely continue for the foreseeable future, following the tightening cycle that began in June 2004.</p> <footer class="entry-meta">
By James Picerno | <a href="https://www.capitalspectator.com/a-dozen-to-date-and-counting/" title="10:13 am" rel="bookmark"><time class="entry-date" datetime="2005-11-02T10:13:22-05:00">November 2, 2005</time></a>
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