AAPL story from The Street.com

It's Just Another Steve Jobs Rumor, but...
Michael Goodman
12/30/08 - 03:19 PM ESTSAN FRANCISCO -- So much for any future one-on-one interviews with Apple(HMC Quote - Cramer on HMC - Stock Picks) CEO Steve Jobs running on the tech blog Gizmodo.
Citing a "solid source," the blog decided Tuesday to go where few have wanted to tread: pronouncing publicly that Jobs' health is declining rapidly. Gizmodo's source, who the blog says has been "100% correct" when passing along product scoops, says this is why Jobs wouldn't give his traditional keynote address at the company's MacWorld Expo in January, as the company announced earlier this month.
Jobs was diagnosed with a malignant but less aggressive form of pancreatic cancer in 2004, undergoing surgery to remove a tumor. Subsequent gaunt appearances in the past couple of years have continued, at the very least, to keep the CEO's health in the back of investors' minds.
The Gizmodo report infused a minor jolt into Apple's stock, which had been up more than 1% most of the session. Shares fell as low as $84.72, off 2%, before moving back recently to $85.79, down just 1%.
CNBC subsequently disputed the Gizmodo story, citing its own sources that no new news about Jobs existed and that his health is "just fine as far we as we know." These sources also reiterated that Jobs' absence from MacWorld was a result of the company's plans to no longer invest in the conference.
Buttressing the Steve-is-fine argument was a Reuters report that quoted a company spokesman as saying "if ever Steve or the board of directors decided that he was no longer capable of doing his job as CEO of Apple, I'm sure they will let you know."
Well, you would forgive an Apple shareholder for taking that claim with a grain of salt. Company executives have consistently fended off queries into Jobs' health, referring to it earlier this year as it a "private matter," a phrase continually proven false by the stock's swoon whenever a rumor of Jobs' ill health comes to the surface.
And it would pay to remember Peter Elkind's piece in Fortune earlier this year that disclosed that both Jobs and Apple's board knew about his original cancer diagnosis for nine months before disclosing it to shareholders.
In any event, it prevents anyone from automatically scoffing at Gizmodo and its "solid source."
Ultimately, investors have to understand that they're never going to really know anything about Jobs' health until they absolutely have to know by the strictest letter of the law.
As long as Jobs is at the helm, the stock will carry with it some unquantifiable degree of risk related to his health -- a company/CEO tie-in perhaps only surpassed by Warren Buffett and Berkshire Hathaway(BRKA.A Quote - Cramer on BRKA.A - Stock Picks).
The trick, as always, is calculating that risk against the huge opportunity for future upside that could be orchestrated by the man himself.



posted by Peter Greene

The Worst Predictions About 2008

Just about everybody got wrong-footed by 2008, but some people's mistakes were truly spectacular

By Peter Coy

Editor's Note: This new version of the "ten worst predictions about 2008" changes three of the ten based on feedback from online readers and BusinessWeek editors. CNBC's Jim Cramer and President Bush are still on the list, but with different predictions. Author Shelby Steele is off the list, replaced by a pair of BusinessWeek writers.

Here are some of the worst predictions that were made about 2008. Savor them—a crop like this doesn't come along every year.

1. "A very powerful and durable rally is in the works. But it may need another couple of days to lift off. Hold the fort and keep the faith!" —Richard Band, editor, Profitable Investing Letter, Mar. 27, 2008

At the time of the prediction, the Dow Jones industrial average was at 12,300. By late December it was at 8,500.

2. AIG (AIG) "could have huge gains in the second quarter." —Bijan Moazami, analyst, Friedman, Billings, Ramsey, May 9, 2008

AIG wound up losing $5 billion in that quarter and $25 billion in the next. It was taken over in September by the U.S. government, which will spend or lend $150 billion to keep it afloat.

3. "I think this is a case where Freddie Mac (FRE) and Fannie Mae (FNM) are fundamentally sound. They're not in danger of going under…I think they are in good shape going forward." —Barney Frank (D-Mass.), House Financial Services Committee chairman, July 14, 2008

Two months later, the government forced the mortgage giants into conservatorships and pledged to invest up to $100 billion in each.

4. "I'm not an economist but I do believe that we're growing." —President George W. Bush, in a July 15, 2008 press conference

Nope. Gross domestic product shrank at a 0.5% annual rate in the July-September quarter. On Dec. 1, the National Bureau of Economic Research declared that a recession had begun in December 2007.

5. "I think Bob Steel's the one guy I trust to turn this bank around, which is why I've told you on weakness to buy Wachovia." —Jim Cramer, CNBC commentator, Mar. 11, 2008

Two weeks later, Wachovia came within hours of failure as depositors fled. Steel eventually agreed to a takeover by Wells Fargo. Wachovia shares lost half their value from Sept. 15 to Dec. 29.

6. "Existing-Home Sales to Trend Up in 2008" —Headline of a National Association of Realtors press release, Dec. 9, 2007

On Dec. 23, 2008, the group said November sales were running at an annual rate of 4.5 million—down 11% from a year earlier—in the worst housing slump since the Depression.

7. "I think you'll see [oil prices at] $150 a barrel by the end of the year" —T. Boone Pickens, June 20, 2008

Oil was then around $135 a barrel. By late December it was below $40.

8. "I expect there will be some failures. … I don't anticipate any serious problems of that sort among the large internationally active banks that make up a very substantial part of our banking system." —Ben Bernanke, Federal Reserve chairman, Feb. 28, 2008

In September, Washington Mutual became the largest financial institution in U.S. history to fail. Citigroup (C) needed an even bigger rescue in November.

9. "In today's regulatory environment, it's virtually impossible to violate rules." —Bernard Madoff, money manager, Oct. 20, 2007

About a year later, Madoff—who once headed the Nasdaq Stock Market—told investigators he had cost his investors $50 billion in an alleged Ponzi scheme.

10. "There's growing evidence that parts of the debt markets…are coming back to life." —Peter Coy and Mara Der Hovanesian, BusinessWeek, Oct. 1, 2007.

Oops.

Coy is BusinessWeek's Economics editor.



posted by Peter Greene

our morning comments

The Numbers Don't Lie ...

The reason we like statistical and technical analysis is for one simple reason, the number don't lie. The numbers are unemotional, they don't fall in love with stories, the don't get passionately bullish or bearish they just are what they are. Now the downfall of the numbers like any method of following the market is they are nowhere near perfect (but then again what is ?). However the numbers are a direct reflection of the market, they are not manufactured or manipulated. Again they are what they are and in that's the beauty of it.

When we say "the numbers" we talk about things such as new highs vs. new lows, advancing stocks vs. declining stocks, the continuous level of up volume versus down volume, the deviation in the VIX Index from its normal trend to name a few. Within FusionIQ we monitor even statistics such as the % of stocks that are in various scoring ranges such as; Bullish (stocks ranked 70 - 100), Neutral - (stocks ranked 40-70) and Bearish (stocks ranked less than 40). We also monitor the number of new BUY signals vs. new SELLS signals to see which way the markets near-term directional bias is tilting. Again not that these are perfect indicators but when they all start to align in either a bullish or bearish way it gives you a higher degree of confidence that you are on the right side of that market and that is what this game is all about. Stock picking to some degree is only as good as which way they market tide is going. (Though you will always get a few names that buck the trend the majority of issues move in sync with the market)

In fact one of the main determinants that moved us negative very early was the large number of stocks ranked in FusionIQ that fell into its bearish category six and nine months ago. Again not that the numbers are always right but when 65 % of all stocks in our ranking system are ranked lower than 40, that has to raise a red flag. As I said before we don't make the numbers but the fact that a large number of issues went below 40 rankings (the scores were clearly driven down as we know now by external factors as well as supply and demand) certainly demanded attention. When readings such as this are combined with other pieces of unbiased confirming evidence such as new lows every day in the cumulative advance-decline line for the S&P 500 and more new 52 week lows than 52 week new highs (consistently) it really connects the dots.That said most of these aforementioned indicators still have poor readings hence why we keep repeating that one should play it closer to the vest for now and make lighter capital commitments until these statistics improve off the lows .

Look for out S&P 500 and NASDAQ 100 pieces to be published this coming Monday.
Best.

Fusion Analytics Research Partners LLC






posted by Peter Greene

Merry Christmas

Hope you and your family have a blessed Christmas...




posted by Peter Greene

Our morning comments

I don't like to be a Bull or a Bear. I like to be impartial, sort of like Switzerland and let the weight of the evidence direct me. If the evidence suggests that the market has a better chance to go up I will employ long strategies. Conversely if the evidence suggests the market will go down I will raise cash and employ short strategies. So I try not to pick a side but rather let the data and unbiased/unemotional evidence steer me in the potentially right direction. Sometime the evidence screams bullish, other times bearish and still other times (like presently) the tea leaves are mixed. In this scenario it is best as I said yesterday to make smaller commitments until the evidence is more convincing. That said I believe the market is a discounting mechanism and the reason we dropped 46 % from the recent S&P 500 peak is because the market was anticipating the nasty headlines you see today and last week and probably over the next several months and boy when you read them it makes you not want to get out of bed today (lol !) However if it is in print then astute market players have long since factored in the news I believe. So as the horrendous headline news hits the tape each day watch it is important to watch how the market reacts. If it continues to drop and drop well then this news hitting the tape was not in fact discounted, however if we continue to rally on bad news then that would be a good sign.

Go ahead take a gander at today's collection of headline news:AP - New Jobless Claims Jump to 26-Year HighReuters - Durable goods drop 1 percent in AP - Oil falls towards $37, tracking global equity lossesAP - World markets slip after gloomy US economic dataReuters - Toyota's global sales mark worst in 8 yrs.In summary it is hard to put any stock in days leading up to the holidays since volume tends to be light and the real decision makers at large institutions leave early but we will know soon enough as the New Year approaches if the bad news is already baked in. My best guess is the market knows all this bad news already it is more trying to handicap how good the current bailout and multiple stimulus packages will work. If we go lower then the market is saying its not enough. If we can rally then the market is saying we believe the globally concentrated effort to stave of this chasm is going to work. Volume and internals will signal which way the market will go. Over the last 5 months there has been consistently more down volume than up volume, more decliners than advancers and more new lows than new highs (day after day after day). However of late the negative skew is dissipating so the idea now is to watch for the turn in internals the other way (i.e. a consistency of more up than down volume, more advancers than decliners and more new highs than new lows.) Technically the 50-day moving average stalled all the major indices recently (as well as the 9,000 level on the Dow). To get any sustained move up we need to break above these levels.Of note one group is starting to show some consistent strength in this mess; Biotechs. Keep your eye on this group as they may emerge as a leadership area of the market when the tape turns. We will put together a list of good looking biotech names for next Monday.

Happy Holidays !!

K Lane

posted by Peter Greene

ZZZZZZZZZZ

Expect a REAL quiet one today and Friday...

Equities close at 1pm and bonds at 2pm. There will be more people at Grand Central at noon than trading...

Nothing to read into yesterdays 100 point loos on the Dow, quietest 100 down of the year...

Start your egg nog early!

Scariest news yesterday was the suicide of a hedge fund manager that lost over a billion with Madoff. The even sadder it probably will not be the last..


posted by Peter Greene

hearing MOC

Upstairs chatter that there's 8MM CIT to BUY on the bell .... down here we see only 215k to buy MOC thus far .... (update: S&P adjustment.... hearing 8.55 mill to buy)




posted by Peter Greene