Frozen Market and No Worries?

If you were wondering Thursday how the NASDAQ could remain stuck at one price for a period of time (about 3-hours worth) no, that wasn’t everyone getting bored:  That was a technical glitch.  As the NY Times recounts it, in their report over here, the problem comes just two days after Goldman sent out a bunch of errant trades and this gets us down to asking again some very difficult questions about the market.

First:  Should there even be such a thing as high-speed trading?  It’s like having a craps game being played while ostensibly playing roulette:  You decide to bet on the number 6, but before you can get your bet placed, a whole bevvy of side players at an in-line craps table have yelled “Coming out!  Six is hot…”  Would you play in a casino where the big money is not on your roulette call, but is mostly being made at the in-line craps game?

Second:  For an exchange which trades so many of the big-name tech stocks, you’d think there would be redundant systems on a hot/standby basis.  You know, just like a RAID array in a serious desktop but bigger.

Third: Because of inter-market arbitrage, this has just a whiff of not-quite-accidental, since people like me who try scalp some very short-term trades now and then using the 1-minute chart and since the NASDAQ tends to be higher beta than the Dow stocks, this is definitely hard on compulsive gamblers….I mean investors and more to the point it screws up cycles which work fine as long as the markets are open but they disrupt other action…hence the “whiff.”

Fourth:  Where’s the accountability?  This is precisely the kind of trading accident that while not-too-damaging on a slow late summer’s session could be a wealth-killer for those trying to bail out of a meltdown in late October yet to come.

I may be stating the obvious here, but Jim Kramer nailed it on Mad Money on CNBC yesterday and in case you missed it, the video and transcript are over here.  My favorite part is this:

okay, nasdaq we can’t ask you to build the equivalent of a plane withinplane, but where is the backup system? why isn’t there a server where the nasdaq can flip a switch and maybe slower maybe, but at some pace that makes you feel like it’s not a farce. we know there are such things as redundant systems. we know that they’re costly. i’m sure the nasdaq doesn’t want a sedge second system ready at all times because it would be expensive and hurt the earnings per share. aps, sometimes we sacrifice everything on the altar of profitability. the traders have so much clout in washington that i bet the s.e.c. couldn’t even order them to do that. blow back would be too huge.

There’s another example of what I’ve told you before:  ‘Merica is living on borrowed time because the Big-Monied Special Interests have taken over Washington in the form of lobbyists and power groups wielding campaign money and persuasion blocks.  And what used to be a dead-to-nuts honest casino is struggling to maintain that appearance, so long as you remember (and don’t mind) your bet on the roulette table triggers a craps game on the side while the slow wheel spins as the front-runners slice a tiny piece off every chip you play.

Not much on the econ calendar this morning so stocks are set to open up slightly.  We are cautious later in the day as the market is near critical support levels and no one knows how crazy things could get in the Middle East over the weekend, so closing out long positions today is possible.

Asia saw a 2.2% rise in the Nikkei overnight but most of Europe is on hold, though formerly Great Britain was up 0.5% when I checked earlier.

Summer doldrums.

Slooow Recovery

As we explained to Peoplenomics subscribers yesterday in our monthly check of US West Coast Ports,  there’s evidence that a slow economic recovery of sorts is underway.  That view was underscored in Thursday’s Conference Board Leading Economics Indicators report:

The Conference Board Leading Economic Index® (LEI) for the U.S.

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Coping: Marketing Beyond Sexual Preference

I was noticing this morning the headline “White House to hold closed-door session on bisexual issues next month, ” and I got to thinking,  “Behind closed doors, is where sexual preference could have been left.  Consenting adults and all that, but of course absent genuine economic growth we get what we get….”

The scope (and grandeur) of the LBGT movement’s takeover of socioeconomics is really very impressive in a marketing sort of way.

Not to pick on Hilton Hotels (I like Hilton) but their “Offers” page, which is a summary of different deals and promotions currently, says reams about how life in changing in ;’Merica.

Well, look at their “Family Fun Package” and you’ll find a page with 159 words on it, including the headline.

On the other hand, the LBGT-directed “Stay Hilton. Go Out.” page is 355 words in length.  In other words, more than twice as much ad copy promoting to the LBGT market as to the family market.

As a marketer I suppose it makes sense:  If you have kids, can you really afford to take the whole brood to a nice (and usually upscale) hotel?  Probably not.  But, since most gay couples are working and don’t have kids, there’s a higher disposable income, and marketers do what marketers do…go for the money.

As a result, hotels. restaurants, and entertainment are off on a new “growth” direction and (again due to a lack of fundamental jobs and not having enough to really “do” as a country) we are seeing the expansion and monetization of EVERYTHING.

I must be considerably older than I thought, though, since it occurs to me that I seem to be the only person left on the planet able to figure out that sexual preference decisions shouldn’t be made until after or at least late puberty when hormones settle down a bit…but that’s why I don’t live in Kalifornia, I suppose.  Hell, I might even go back some day because there’s not much bizarre to write about here in the Outback.  Never a shortage of craziness out West and it does make interesting headlines.

And speaking of turning everything (including disasters and tragedies) into business models…

If you want a particularly convincing and sad example of monetizing EVERYTHING look no further than this morning’s  headline “  Paula Deen SHOOTS Trayvon Martin’ in new SVU that wraps both scandals into one controversial episode… and Cybill Shepard plays gun-wielding TV chef…”

Stand by for the Adventures in Waterboarding cartoon series, next.  Or was that on South Park?

The Last Word on Vaccines

While my main point in the vaccine discussion is sorting out my feelings about the “shingle” vaccine for old farts like me, I’ve made up my mind for sure NOT to get it.  One reason?  Looks like the protection is only 50%.  But some of the remarks from reader that have come in are just too good not to pass along:  Like this from reader Roberta:

Your article today was very valuable to me, due to the education about the Cochrane Library- and also the quote from the British Health Service regarding the shedding of viruses from the vaccinated to the non-vaccinated. I happened to read about the latter in an article which quoted one of the polio vaccine’s developers, and in it they assumed the SV40/polio would be shared with parents and other contacts.

I work in a hospital virus lab, where we grow viruses on cells of humans and other species. I had always been pro-vaccine until the day I received a warning notice from my cell supplier, stating that a cell line (which we didn’t use anyway) was contaminated with a naturally-occurring virus from the animal from which the cell line was made. Knowing that the influenza virus required animal cells, I started looking into the issue. There isn’t a way to “scrub off” naturally occurring viruses in order to make vaccines (hence, the recent contamination of the rotavirus vaccine with pig DNA, which we’re not supposed to worry about). Some of my virus co-workers refuse the flu vaccination, and we are forced by the hospital to wear surgical masks upon setting foot in the lab.

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Employment Disaster?

The very first thing to do this morning is go hit the Gallup Poll website here and look at what they are seeing in short-term employment trends: In just the last month, their count of unemployed has risen from 7.9% to 8.9% and the number of people underemployed (which is your bus driver with a degree and such) has risen to Depression-era levels around 18%. OK, 17.

Coping: The Great Vaccine Debate

Oh, boy, I stepped in it by mentioning vaccines the other day.  The email has been overflowing with people offering a lot of sound background like this from reader Lois:

Hi George,

  I’m afraid I must disagree with your wonderful children on the autism/vaccine issue. Dr Andrew Wakefield is the doctor whose autism-vaccine link study has been discredited. They say he faked the evidence and he lost his medical license. There has been a huge attempt to discredit him and his study which you can see if you do a search for his name. But if you look between the lines you will find vaccine manufacturers are quietly awarding families large settlements because they admit their vaccine did cause the child’s autism. You can read about it here:  LINK

Dr Wakefield has filed a lawsuit for defamation of character in Austin TX. You can read about it here: LINK

Since Dr Wakefield’s study was published in the British Medical Journal (which they retracted) and the BMJ receives funding from pharmaceuticals I think it is worth at least listening to what Dr Wakefield has to say.

And reader Gary adds:

Whoa, not so fast, George.

I remember reading an article that showed that measles was declining into insignificance at the time the vaccine was introduced.  Once introduced, there was an increase in the incidence of measles!

I’m sure the article is still out there somewhere. The data surely is.

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Murder Rooms and the Slow Death of Bonds

Two rather distasteful subjects to cover this morning, each involving death, butat least we have a choice: Do we extend ultimate home prepping to followthe construction plans of the S.A drug cartels, or do we die when the bondmarket implodes? The one certainly fits with building a solid home defenseplan verging on the paranoid, while the other comes along to some extent nomatter what due to incredible assumptions about returns built into many pensionplans. Fortunately, before we get to the blood and gore on either front,we’ll first have coffee and remind you not to sit too close to the monitor forthis morning’s report.