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12 Nov 2009

Discussing the latest deficit data, with CNBC's Steve Liesman, Rick Santelli & Bob Pisani; Robert Samuelson, Newsweek & Washington Post columnist; and James Horney, Center on Budget & Policy Priorities.

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NYSE Market Wrap

Bob Pisani reports on the trading day from the NYSE.

NYSE Midday Report

CNBC's Bob Pisani reports on the trading day from the NYSE.

Dollar General Starts Tradi...

Insight on earnings, with Rick Dreiling, Dollar General chairman & CEO and CNBC's Bob Pisani.

NYSE Morning Preview

Bob Pisani reports on the trading day from the NYSE.

NYSE Market Wrap

Bob Pisani reports on the trading day from the NYSE.

Dealing with the Deficit

Discussing the latest deficit data, with CNBC's Steve Liesman, Rick Santelli & Bob Pisani; Robert Samuelson, Newsweek & ...

NYSE Midday Report

CNBC's Bob Pisani reports on the trading day from the NYSE.

NYSE Morning Preview

CNBC's Bob Pisani reports on the trading day from the NYSE.

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Jan.15

9:41 AM ET

Thursday, 15 Jan 2009

Does The Street Have Consumption?

Posted By:Bob Pisani

Topics:Earnings | Economy (U.S.) | Economy (Global) | Investment Strategy | Stock Market

I was talking with one of the traders at the NYSE Commissary this morning, and we agreed that last year's fourth quarter was like dying by being thrown out of a plane: it was terrifying and exhilarating at the same time.

This year is like dying of consumption: it's slow, and there's days where the death is absolutely....boring.

That was yesterday.

Dying of consumption, and no one cared: traders huddled around the monitors to watch CNBC's coverage of Bernie Madoff driving around midtown while the markets remained at the lows of the day...all day.

Elsewhere:

1) The good news about JP Morgan (up 4 percent pre-open) [JPM Loading... () ] is that the earnings number was positive, far better than many expected. Deposits grew 4 percent, assets under management dropped just 2 percent, net interest margin (the difference between what you're lending and what your paying out in deposits) increased 55 basis points to 3.28 percent.

More good news: Dimon says he is comfortable with the dividend, currently $0.38 a quarter with a yield of 5.9 percent.

The bad news is: a) much of the earnings came from a gain on the Washington Mutual deal, b) there was a big build in reserves, c) $2.9 billion of write-downs on leverage lending/mortgage exposures and private equity write-downs of $700 million, and d) the outlook is ugly: credit is getting worse and investment banking will continue to see lower earnings.

UBS [UBS Loading... () ] summarized the general feeling on the Street: "While outlook is weak, it's been well telegraphed & we think results should be good enough to stabilize JPM for now post recent drop in the stock."

2) Reports that Bank of America [BAC Loading... () ] may get another infusion of TARP money to cover greater than expected losses at Merril Lynch was another demoralizing note for the Street, which already is full of conspiracy theories that the government is running the banks behind the scenes.

Mike O'Rourke at BTIG summarized the Street's feelings: "for Treasury to cut another check to a bank appears futile...the investment community wants to see the balance sheets of financial institutions begin to start moving merchandise and shrink."

3) Lawn mower engine maker Briggs & Stratton [BGG Loading... () ] beat estimates, and guidance was right in line with expectations; stock trading up 12 percent on light volume.

4) How lousy are things in retail land? Last night Standard and Poors announced that Pacific Sunwear [PSUN Loading... () ] was being removed from the S&P Midcap Index. Why? Well, the stock has gone from $10 to $1.12 in the last eight months, and now has a market capitalization of only $73 million. That's not even a small-cap stock, that's a microcap. It will be replaced by Landstar System [LSTR Loading... () ] , with a still-small cap of $1.7 billion.

5) There's been a lot of complaints overnight that the Board of Apple [AAPL Loading... () ] should have been more aggressive in pushing Steve Jobs to disclose more information on his health, and that Jobs may have successfully intimidated them into saying nothing.