-- Posted Wednesday, 5 November 2008 | Digg This Article | Source: GoldSeek.com

We’ve been holding fast to an outlandishly bullish Dow target of 9955 for the last 600 points, even if we can’t claim to understand why stocks seem to want to keep rising in the face of the most severe economic downturn since the 1930. It’s not as though deflation’s chokehold on the economy has taken a hiatus. Yesterday, for instance, amidst a climactic frenzy of campaign coverage, there was still room above the fold for news that manufacturing activity had fallen to a 26-year low, that auto sales were down 32% in October from already depressed levels, and that the banks, far from disgorging bailout money to down-and-out homeowners, have continued to tighten their lending standards.

We never put much store in the Guvvermint’s lend-or-else mandate, but we’d expected the resistance to credit growth to come mainly from the borrowers’ side.  But what’s a banker to do if he can’t find any creditworthy borrowers?  In fact, the bankers have done what we might have expected – i.e., taken a big chunk of the bailout money to pay themselves bonuses. Goldman Sachs even added a little Keynesian stimulus, taking $12 billion in rescue money for its London operations while paying out $14 billion to the partners. There are 443 of them, and each will pocket a Christmas bonus averaging a little less than $5 million. Maybe that’s why stocks rallied yesterday? If Goldman partners are a–gittin' while the gittin’s good, then maybe time aren’t as tough as they appear. (If you’d like to have Rick’s commentary delivered free to your e-mail box each day, click here.)

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And the Winner Is…

It’s 8:30 p.m. in the East, and Obama has just been projected as the winner in Pennsylvania. If this assessment holds, it will have reduced McCain’s odds of victory to a very low order of probability. Polls aside, while it was not inconceivable going into today for McCain to rack up 270 electoral votes, he desperately needed Pennsylvania’s 23 votes to do it. We won’t go out on a limb with a “Dewey Defeats Truman” headline, but there’s probably no point in wasting the evening watching network coverage of the presidential race if you can find something better on TV.

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Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not be construed as an indicator of future results, so let the buyer beware. Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers’ initials will be used unless express written permission has been granted to the contrary. All Contents © 2008, Rick Ackerman. All Rights Reserved. www.rickackerman.com

-- Posted Wednesday, 5 November 2008 | Digg This Article | Source: GoldSeek.com

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