The Market Bull – August 9, 2019
For the week the Standard and Poors 500 Index gained 20.58 points or .7%, while the NASDAQ advanced 135.81 points or 1.74%.
The Producer Price Index or PPI matched expectations in June with a .2% advance, on a year ago basis the PPI gained 1.7%, well below the Fed’s desired 2% target. Were it not for large jumps in energy and particularly gasoline prices the series would have been negative for the month. With inflation remaining muted it would seem that the Fed is on track to cut interest rates twice more this year. The motivation being weak global growth, trade policy uncertainty aka rising tariffs and an escalating trade war. Of note from June’s Summary of Economic Projections or SEP, 14 Fed participants noted that they viewed the risks to their GDP or Gross Domestic Product forecast as weighted to the downside, compared with four in the previous SEP.
The Malaysian 1MDB investment scandal involving Goldman Sachs took a marked turn for the worse after criminal charges were filed against 17 former and current Goldman Sachs executives involved in the multi-billion Dollar globe spanning fraud. Announcing the latest charges, Attorney General Tommy Thomas said: “Custodial sentences and criminal fines will be sought against the accused… given the severity of the scheme to defraud and fraudulent misappropriation of billions in bond proceeds.” Goldman said in a statement it believed the charges were “misdirected” and would be “vigorously defended”. In December 2018, Malaysia filed charges against three Goldman units — Goldman Sachs International, Goldman Sachs (Asia), and Goldman Sachs (Singapore) — and two ex-employees. The alleged mastermind of the scandal — Malaysian financier Low Taek Jho, who was close to Najib – the former Malaysian Prime Minister, has been charged in Malaysia and the US but remains at large. Once again big finance demonstrates that its business model is largely based on lie, cheat and steal. Frequently complicit with government at the expense of taxpayers and the citizenry ultimately.
Standard and Poors 500 Index closed at: 2,918.65 down 11.86
NASDAQ finished the day: 7,959.14 down 38.05
Gold ended trading at: $1,508.60 down $9.60