Another nice week in the markets, especially the bond market, which rallied strongly after a series of economic data suggesting that inflation, if not dead, was at least still mild. The stock market was also helped by yet another speech by Alan Greenspan, who talked about how rising house prices provided a more consistent impetus to consumer spending than rising stock prices. The broadcast version of Greenspan's speech looked like it was coming off the Web, giving him the disconcerting appearance of the leader of a strange cult sitting at a small desk in a crowded room. But I may have been the only one who thought this.
In any case, it has been a powerful rally for the stock market in the past week and a half, and all the talk now is of a revived bull market. But it still all seems a bit odd, since the purported bear market lasted only a few weeks, and was founded on nothing more than overwrought concerns about inflation and a sudden advent of panic about Y2K. If you blinked, you missed the whole thing. Which, from an investing perspective, means you should blink as often as you can. And so, on to the Chat.
1. "The Justice Department recommended that Bell Atlantic's application to offer long-distance service to its local customers be denied, saying the company had come close to opening its local networks sufficiently to competitors, but that its efforts fell just short. An initial draft of the memo was reportedly titled 'Only In Horseshoes and Hand Grenades.' "
2. "According to The New Yorker, Republican presidential candidate Steve Forbes believes that commodity prices have been depressed because 'when the Fed tightened up the money supply people who needed to raise cash did so by selling commodities.' Can't you just hear it? 'Paw, the fed funds rate just jumped again. Better go get some more corn out of the silo to dump on the market.' "
3. "After the Nasdaq toyed with the 3,000 level on Tuesday before closing just below it, technical traders came out of the woodwork to say that breaking through 3,000 was going to be tough, because it was a 'resistance level' for the index. Of course, Wednesday the Nasdaq raced past 3000, and Thursday it stayed comfortably above it. So I guess the traders would now say 3,000 is a 'support level.' "
4. "GE CEO Jack Welch announced that he will retire after the company's annual meeting in April 2001, meaning that all eyes will be focused on his succession. Early suggestions for ways of whittling down the list of contenders include: two weeks of Navy SEAL training (if you ring the bell, you're out); a bake-off using GE's cool new photo-light oven; and a gala tourney of Win Ben Stein's Money."
5. "For the first time in recent memory, Disney is following the release of its fourth-quarter and fiscal year results with a conference call on which CEO Michael Eisner will speak about the company's performance and answer questions from analysts. It's just a coincidence that this new openness to the investor community comes at a time when Disney's stock has treaded water for more than a year."
6. "In its opening weekend, Being John Malkovich averaged $25,495 per screen. That means if it had opened on 5,000 screens--instead of only 25--it would have made $127.5 million. In three days! I bet the studio execs are really kicking themselves that they didn't book those 5,000 theaters."
7. "American Home Products and Warner-Lambert announced a $70 billion merger that will create the world's largest drug company. I bet they're hoping those drug-price controls never make it out of committee."