Monthly Archives: November 2008

Dow rallies for a third day; closes at 8,479

NEW YORK (AP) — Wall Street showed some signs of stability Tuesday as investors, heartened by government plans to aid consumer lending companies, selectively bought more stocks following a huge two-day rally. Gains in blue chips gave the Dow Jones industrials and the Standard & Poor’s 500 index their first triple-session advance in more than two months.

Tech stocks lagged the market, sending the Nasdaq composite index lower, as investors bet that businesses will continue slashing capital spending in a recession. Some selling was widely expected after a two-day rally that sent the Dow up nearly 900 points, but the fact that the market performed so well — a contrast to its behavior after past rallies — was an indication that investors are regaining some of the confidence that has been decimated by months of bad economic news.

Three straight days of gains for the Dow and S&P indicates an underlying strength in the market, particularly in the face of a weak technology sector, said Richard E. Cripps, chief market strategist for Stifel Nicolaus.

But it’s “probably too premature” to say that the market has already hit its lowest level of the downturn, he said. “This bottoming phase is going to be a process.”

Many analysts thought the market had reached a bottom weeks ago after the devastating losses of early October, only to see Wall Street take an even sharper dive just last week.

Investors were encouraged Tuesday after the Treasury Department and the Federal Reserve said they planned to provide $800 billion to help unfreeze the market for consumer debt and to make mortgage loans cheaper and more available. The program is aimed at reviving moribund credit markets.

The government, while looking to reduce fear in the credit markets, is eager to see lenders including credit card companies, student loan issuers and car purchase financers resume more normal levels of lending to help stimulate the economy. Since September, when credit markets first froze, financial institutions have been hesitant to hand over money for fear they won’t be repaid. That, in turn, has made it harder for businesses and consumers to borrow.

“We’re getting more clarity about the federal assistance across the board, and I think that’s being well received,” said Arthur Hogan, chief market analyst at Jefferies & Co. “Most of the overhangs in the market are getting answers.”

The Dow rose 36.08, or 0.43 percent, to 8,479.47. The index was up 164 points earlier in the session but also fell 161. The Dow last put a three-day advance together on Aug. 26-28.

Broader indexes were mixed. The S&P 500 rose 5.58, or 0.66 percent, to 857.39, giving the index its first three-day rise since Sept. 10-12. The Nasdaq composite index, hurt by signs that companies are cutting back on technology spending, fell 7.29, or 0.50 percent, to 1,464.73.

Still, advancing issues were ahead of decliners on the Nasdaq Stock Market by 5 to 4. On the New York Stock Exchange, advancers were ahead by more than 2 to 1 on consolidated volume of 6.72 billion shares, compared with 7.65 billion on Monday.

The government’s latest effort to combat the fear hobbling the marketplace overshadowed a report that the nation’s overall economic output shrank in the July-September quarter faster than initially estimated as consumers slashed spending by the most in 28 years.

The Commerce Department said third-quarter gross domestic product declined at a 0.5 percent annual rate, outpacing the 0.3 percent first estimated a month ago. Still, Wall Street had expected the number would worsen, so the report didn’t catch the market by surprise. It was the worst reading since growth fell at a 1.4 percent pace in the third quarter of 2001, which was during the last recession.

And, ahead of the holiday shopping season, investors got some good news about consumers. The Conference Board said its Consumer Confidence Index unexpectedly rose to 44.9 in November, up from a revised 38.8 in the previous month. Last month’s reading was the lowest since the research group started tracking the index in 1967. Economists expected the index to slip to 37.9.

The business research group said Americans’ views on the economy still remain the gloomiest in decades. Consumer spending, always a concern on the Street, has taken on greater importance because the economy cannot expand unless consumers are spending — and they’ve shown increasing reluctance the past few months, a troubling sign with the holiday season approaching.

Treasury bonds fell during the session after most investors focused on the stock market. The yield on the three-month T-bill, considered one of the safest investments, rose to 0.09 percent from 0.01 percent late Monday. Investors worried about the economy and bad debt have flooded into safest areas of the credit markets, driving down yields, but some of their anxiety eased Tuesday.

The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.10 percent in late trade from 3.33 percent on Monday.

The dollar was mixed against other major currencies, while gold prices fell. Light, sweet crude fell $3.73 to settle at $50.77 a barrel on the New York Mercantile Exchange.

Starbucks Corp. warned in a regulatory filing late Monday it expects sales to continue to weaken, at least through the end of the fiscal year. The Seattle-based coffee chain said it expects same-store sales, or sales at stores open at least a year, to decline in fiscal 2009; a bleak outlook earlier this month helped set off a wave of selling on economic fears.

Same-store sales are an important retail metric because they measure how established stores are performing, not just new ones. Shares fell 38 cents to $8.08.

Hewlett-Packard Co. on Monday posted fiscal fourth-quarter earnings that topped Wall Street’s forecast as strong laptop sales helped offset falling printer orders and weakness in some server lines. Shares fell 24 cents, or 2.9 percent, to $8.21 after analysts said they remain concerned about how the company will fare during the recession.

The Russell 2000 index of smaller companies rose 6.38, or 1.46 percent, to 443.18.

Overseas, Japan’s Nikkei stock average rose 5.22 percent. Britain’s FTSE 100 rose 0.44 percent, Germany’s DAX index rose 0.13 percent, and France’s CAC-40 rose 1.18 percent.


Good Tuesday: Wall Street at 8,507 just before noon

BC-Wall Street, 13th Ld-Writethru,1188<\n>Wall Street pulls back after big 2-day rally

NEW YORK (AP) — Wall Street sold off Tuesday as investors, while heartened by government plans to aid consumer lending companies, cashed in some of their winnings after a huge two-day rally.

Some selling was widely expected after the market’s major indexes soared more than 11 percent over the course of Friday and Monday. Those back-to-back gains were the market’s first in three weeks, and Wall Street, consumed by worries about the economy, has been unable to hold on to its advances for very long.

Still, investors were encouraged after the Treasury Department and the Federal Reserve plan to provide $800 billion to help unfreeze the market for consumer debt and to make mortgage loans cheaper and more available. The program is aimed at reviving moribund credit markets.

The government, while looking to reduce fear in the credit markets, is eager to see lenders including credit card companies, student loan issuers and car purchase financers resume more normal levels of lending to help stimulate the economy. Since September, when credit markets first froze, financial institutions have been hesitant to hand over money for fear they won’t be repaid. That, in turn, has made it harder for businesses and consumers to borrow.

“We’re getting more clarity about the federal assistance across the board, and I think that’s being well received,” said Arthur Hogan, chief market analyst at Jefferies & Co. “Most of the overhangs in the market are getting answers.”

The government’s latest effort to combat the fear hobbling the marketplace overshadowed a report that the nation’s overall economic output shrank in the July-September quarter faster than initially estimated as consumers slashed spending by the most in 28 years.

The Commerce Department said third-quarter gross domestic product declined at a 0.5 percent annual rate, outpacing the 0.3 percent first estimated a month ago. Still, Wall Street had expected the number would worsen, so the report didn’t catch the market by surprise. It was the worst reading since growth fell at a 1.4 percent pace in the third quarter of 2001, which was during the last recession.

And, ahead of the holiday shopping season, investors got some good news about consumers. The Conference Board said its Consumer Confidence Index unexpectedly rose to 44.9 in November, up from a revised 38.8 in the previous month. Last month’s reading was the lowest since the research group started tracking the index in 1967. Economists expected the index to slip to 37.9.

The business research group said Americans’ views on the economy still remain the gloomiest in decades. Consumer spending, always a concern on the Street, has taken on greater importance because the economy cannot expand unless consumers are spending — and they’ve shown increasing reluctance the past few months, a troubling sign with the holiday season approaching.

By midafternoon, the Dow Jones industrial average fell 96.86, or 1.15 percent, to 8,346.53. The index was up 164 points earlier in the session.

Broader indexes also fell. The Standard & Poor’s 500 index fell 10.01, or 1.18 percent, to 841.40. The Nasdaq composite index, hurt by signs that companies are cutting back on technology spending, fell 35.65, or 2.42 percent, to 1,436.37.

James Cox, managing partner at Harris Financial Group, said one reason for the pullback is because trading volume is low given the holiday-shortened week. Volume came to a very light 841.8 million on the New York Stock Exchange, where advancing issues held a slight edge over decliners.

“We’ve had a big run over the last two days. It wouldn’t take much to have this rally fizzle out,” Cox said. “This is just kind of a pause, if you will.”

Treasury bonds fell during the session after most investors focused on the stock market. The yield on the three-month T-bill, considered one of the safest investments, rose to 0.08 percent from 0.01 percent late Monday. Investors worried about the economy and bad debt have flooded into safest areas of the credit markets, driving down yields, but some of their anxiety eased Tuesday.

The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.09 percent from 3.33 percent late Monday.

The dollar was mixed against other major currencies, while gold prices fell.

Light, sweet crude fell $3.40 to $51.10 a barrel on the New York Mercantile Exchange.

In Chicago, President-elect Barack Obama announced he chose Peter Orszag as his director of the Office of Management and Budget. Obama also expanded on his economic plan, and said he plans to act immediately on a stimulus package upon his first day in office.

Phil Orlando, chief equity market strategist at Federated Investors, contends the market is beginning to lay the groundwork for a recovery because investors are starting to believe the breadth of the government’s actions will begin to aid the economy. He pointed to the latest efforts of the Paulson and Federal Reserve Chairman Ben Bernanke.

“The Armageddon scenario in our mind is off the table because there is nothing the Treasury or Bernanke won’t do to try and make things right,” he said. “Investors are starting to recognize that maybe the world is not coming to an end.”

Starbucks Corp. warned in a regulatory filing late Monday that it expects sales will continue to weaken, at least through the end of the fiscal year. The Seattle-based coffee chain said in its annual report that it expects same-store sales, or sales at stores open at least a year, to decline in fiscal 2009; a bleak outlook earlier this month helped set off a wave of selling on economic fears.

Same-store sales are an important retail metric because they measure how established stores are performing, not just new ones. Shares fell 32 cents to $8.13.

Hewlett-Packard Co. on Monday posted fiscal fourth-quarter earnings that topped Wall Street’s forecast as strong laptop sales helped offset falling printer orders and weakness in some server lines. However, shares fell $2.32, or 6.6 percent, to $33.25 after analysts said they remain concerned about how the company will fare during the recession.

The Russell 2000 index of smaller companies fell 7.78, or 1.78 percent, to 429.02.

Overseas, Japan’s Nikkei stock average rose 5.22 percent. Britain’s FTSE 100 rose 0.44 percent, Germany’s DAX index rose 0.13 percent, and France’s CAC-40 rose 1.18 percent.

 

Tough Times Make Students Bullish About Finance Class

By Marietta Nelson

For The Kitsap Sun 

North Kitsap High School student Teagan Burns can’t figure out why the American economy is in such a mess.

“I’ve asked and asked and nobody can answer my questions,” she said.

Burns takes a class in personal finance taught at the school by Mary Anne Alexander. When the school year began, the 17-year-old Burns said she “literally knew nothing” about money.

In the months since, the precocious teen determined that a lack of knowledge “seems to be why our economy and our government are in so much trouble.”

Personal finance should be required for everyone before they leave high school, Burns said. 

Alexander helps kids determine the difference between needs and wants and teaches everything from balancing a checkbook to investing.

“So many people leave high school knowing so much about math and history, but nothing about money,” Burns said. “If they can make me learn to run in gym, they can certainly teach me and everyone else how to balance a checkbook.”

The current economic crisis worries Kitsap County teens, and they are talking about it in financial management classes at local high schools. By learning to budget, invest, buy insurance, use credit cards and more, teens hope to avoid the problems of so many adults around them.

“I want to be able financially to know what I am doing when I graduate,” said Adrianna Burgonoi, a junior at Central Kitsap High School.

State leaders recognize the importance of financial literacy, too. A task force studying financial education in public schools will report to Gov. Chris Gregoire in December with new ways to teach kids to handle money properly. 

Cathy Brorson serves on the task force and coordinates Kitsap Credit Union’s education program. Credit union employees visit Kitsap County schools dozens of times each year, reaching thousands of students with information about money management.

“We’re just trying to open students’ eyes to all aspects of managing their finances. It’s the best thing we can do for this generation and generations to come,” Brorson said. 

At Central Kitsap High School, Cynthia Blinkinsop’s Money Management class began the year watching “Affluenza,” a PBS documentary exploring America’s culture of overconsumption. 

Blinkinsop’s students have tracked expenses, including extrapolating the costs of things like electricity and house payments from their own families’ finances. Using that information, the students built personal budgets. They’ve also learned to establish credit and use credit cards wisely.

Seventeen-year-old Derrick Brillhart learned to balance his checkbook, which has been overdrawn. Brillhart works at Safeway and used to spend most of his paycheck on expensive food, like $2 energy drinks, during his breaks. Now he opts for vending machine fare that “costs like 50 cents,” he said.

Classmate Ally Holtzinger learned to read credit card offers carefully. The most recent offer she received from American Express offered her $500 just to sign up. She shredded it instead.

For a discussion about education issues, check out the Kitsap Education blog at pugetsoundblogs.com/kitsapeducation.

Kitsap Business Briefs

On the Job

Jaqulyn Kyles, a marketing assistant with Kitsap Bank, has been named Employee of the Third Quarter for 2008. Kyles, a graduate of Eastern Oregon University, joined Kitsap Bank in 2007 and is described as a “true team player,” by Shannon Childs, Kitsap Bank senior vice president and marketing director. 

“Her commitment to Kitsap Bank has been evident this year as she worked tirelessly on a number of major projects, including helping us launch a newly redesigned Web site and commemorate the bank’s centennial year,” Childs said.

Silverdale Lowe’s
to Open on Friday

SILVERDALE

The Silverdale Lowe’s is scheduled to be open the day after Thanksgiving, to accommodate early holiday shoppers.

The store’s formal grand-opening ceremony is scheduled for a week later. 

The store is at 2221 NW Myhre Road, just behind Costco and across the street from The Doctor’s Clinic.

The store has 131,000 square feet of retail and garden space and generated 120 new jobs for the area, according to the company. Initial construction costs for the building were estimated at $12 million. 

The Lowe’s a few miles away on Highway 303, built in 2002, will remain open.

Silverdale Lowe’s will be open from 6 a.m. to 9 p.m. Monday through Saturday and from 7 a.m. to 8 p.m. Sunday.

Doggie Spa Opens
on Bainbridge

BAINBRIDGE ISLAND

A grand opening for The Fluffy Ruff Dog Spa, 344 Tormey Lane NE, Suite 173, on Bainbridge Island, is scheduled for 9 a.m. to 5 p.m. Dec. 2, according to owner Julie Rust, a graduate of The Paragon School of Pet Grooming.

Rust recently completed master groomer certification with the National Dog Groomers Association. She is an award-winning pet stylist, having competed in Atlanta; Charlotte, N.C.; Cape Canaveral, Fla.; and Olympia.

Reach her at (206) 842-3599 or at thefluffyruff08@gmail.com.

Builder Adds Services for Homebuyers

BREMERTON

Cutting Edge NW of Bremerton is expanding its services to offer home assessment services for people interested in having a professional builder accompany them through new construction walk-throughs or through existing homes for sale. 

The assistance would allow prospective homeowners to obtain a comprehensive list of items needing repair or replacement before finalizing a sale. The service is designed to provide buyers with information about the cost of repairs. 

The firm also will offer remodeling services and possible partial financing for approved homeowners in need of home repair.

Reach them at (360) 286-4264 or cuttingedgenw@contractor.net.

Calendar

Nov. 25

What: The Puget Rental Owner’s Association will host Mark Gjurasic of Public Affairs of Washington, who will give an in-depth legislative update and discuss residential and rental issues. All rental owners and the general public are invited.

When: 6 p.m. dinner; 6:45 p.m. president’s comments followed by the speaker.

Where: AA China Buffet, 3583 Wheaton Way in East Bremerton.

For More Information: Call (360) 479-1683.

 

Nov. 26

What: The Silverdale Chamber of Commerce will host Jon Pearson, president of the Central Kitsap Community Council, at its membership luncheon. He will provide an overview of the council’s work and upcoming projects. The Marine and Sailors of the Quarter will be recognized. It is open to the public.

The meeting will also feature a business showcase, highlighting businesses offering gift ideas for the holidays.

When: 11:30 a.m. to 1 p.m.

Where: Silverdale Beach Hotel, 3037 NW Bucklin Hill Road in Silverdale. 

Reservations: Required in advance; call the chamber at (360) 692-6800 or visit www.silverdalechamber.com. The cost is $20.

 

Nov. 26

What: North West Business Connections, a local chapter of BNI, will have its weekly meeting. Member Tami Kelly, representing Pre-Paid Legal Services Inc., will be speaking on how to gain protection and peace of mind in the area of identity theft. Anyone interested in participating with a group of business professionals working together to expand their word-of-mouth referral business is welcome to visit. 

When: 7:30 a.m. to 9 a.m. 

Where: Bay View Java Coffee Shop, 1213 Bay Street in Port Orchard.

For More Information: Contact Marie Wohlert at (360) 876-5005. 

Kitsap Business Calendar

 

Calendar

Nov. 25

What: The Puget Rental Owner’s Association will host Mark Gjurasic, Public Affairs of Washington, who will give an in-depth legislative update and discuss residential and rental issues. All rental owners and the general public are invited to attend.

When: 6 p.m. dinner; 6:45 p.m. president’s comments followed by the speaker.

Where: AA China Buffet, 3583 Wheaton Way in East Bremerton.

For More Information: Call (360) 479-1683.

 

Nov. 26

What: The Silverdale Chamber of Commerce will host Jon Pearson, president of the Central Kitsap Community Council, at its membership luncheon. He will provide an overview of the council’s work and upcoming projects. The Marine and Sailors of the Quarter will be recognized. It is open to the public.

The meeting will also feature a business showcase, highlighting businesses offering gift ideas for the holidays.

When: 11:30 a.m. to 1 p.m.

Where: Silverdale Beach Hotel, 3037 NW Bucklin Hill Road in Silverdale. 

Reservations: Required in advance; call the chamber at (360) 692-6800 or visit www.silverdalechamber.com. The cost is $20.

 

What: North West Business Connections, a local chapter of BNI, will have its weekly meeting. Member Tami Kelly, representing Pre-Paid Legal Services, Inc., will be speaking on how to gain protection and peace of mind in the area of identity theft.

Anyone interested in participating with a group of business professionals working together to expand their word of mouth referral business is welcome to visit. 

When: 7:30 a.m. to 9 a.m. 

Where: Bay View Java Coffee Shop, 1213 Bay Street in Port Orchard.

For More Information: Contact Marie Wohlert at (360) 876-5005. 

 

 

Builder Adds Services Aimed at Homebuyers

Cutting Edge NW of Bremerton is expanding its services to offer home assessment services for people who are interested in having a professional builder accompany them through new construction walk-throughs or existing homes for sale. 

The assistance would allow prospective homeowners to obtain a comprehensive list of items needing repair or replacement before finalizing a sale. The service is designed to provide buyers with information about the cost of repairs. 

The firm also will offer remodeling services and possible, partial financing for approved homeowners in need of home repair.

Reach them at (360) 286-4264 or cuttingedgenw@contractor.net.

Doggie Spa Opens on Bainbridge Island

The Fluffy Ruff Dog Spa, 344 Tormey Lane NE, Suite 173, on Bainbridge Island, will have its grand-opening Dec. 2 from 9 a.m. to 5 p.m., according to owner Julie Rust, a graduate of The Paragon School of Pet Grooming.

Rust recently completed her certification as a master groomer with the National Dog Groomers Association. She is an award-winning pet stylist, having competed in Atlanta, Charlotte, Cape Canaveral and Olympia.

Reach her at (206) 842-3599 or at thefluffyruff08@gmail.com.

Kyles Named Kitsap Bank’s Employee of the Quarter

Jaqulyn Kyles, marketing assistant in Kitsap Bank’s marketing department, has been named Employee of the Third Quarter for 2008. Kyles, a graduate of Eastern Oregon University, joined Kitsap Bank in 2007 and is described as a “true team player,” said Shannon Childs, Kitsap Bank senior vice president and marketing director. 

“Her commitment to Kitsap Bank has been evident this year as she worked tirelessly on a number of major projects, including helping us launch a newly redesigned Web site and commemorate the bank’s centennial year,” Childs said. 

Silverdale Lowe’s Slated to Open on Black Friday

The Silverdale Lowe’s is scheduled to be open the day after Thanksgiving, to accommodate early holiday shoppers.

The store’s formal grand-opening ceremony is scheduled for a week later. 

The store is at 2221 NW Myhre Road, just behind Costco and across the street from The Doctor’s Clinic.

The store has 131,000 square feet of retail and garden space and generated 120 new jobs for the area, according to the company. Initial construction costs for the building were estimated at $12 million. 

The Lowe’s only a few miles away on Highway 303, built in 2002, will remain open.

Silverdale Lowe’s will be open Monday through Saturday from 6 a.m. to 9 p.m. and Sunday from 7 a.m. to 8 p.m.

Wary Consumers Will Need Convincing this Black Friday

Electronics and inexpensive smaller items will be top sellers this holiday season.

By Rachel Pritchett

rpritchett@kitsapsun.com

Undaunted by dismal retail forecasts, storekeepers will be doing everything in their power to get cautious consumers to lighten up and buy something this Black Friday.

There are the early hours on Friday, the day after Thanksgiving for first grab at the goods.

At Kitsap Mall, some of the anchor stores will open at 4 a.m. and everyone else opens two hours later. The Poulsbo Wal-Mart Superstore opens at 5 a.m. and the Silverdale Target at 6 a.m.

Then there are the expected deals, and this year, they better really wow.

“It’s all about deals,” said mall Marketing Manager Yvonne Tomascak.

Retail sales in some areas — electronics, for instance — decreased about 20 percent during the first half of November over last year, so stores are working hard to do what they have to do to get out of the hole.

And if really big bargains aren’t there, shoppers won’t shop, the National Retail Federation predict. 

That’s one reason they’re shunning gift cards for purchases that can’t take advantages of bargains. Gift-card sales will drop 6 percent this holiday season, the NRF predicted.

Retailers also will be promoting “Cyber Monday” on Dec. 1 to kick off the Internet holiday shopping season. Eighty-four percent of retailers will have one-day cybersales then, more than any time in the past, according to the NRF, the biggest retail association in the nation.

And if they buy, what will they buy?

“The new technology,” said Doug Ayerst, manager of the Poulsbo Wal-Mart.

That includes flat-screen televisions, laptops and Blu-ray discs. Add to that “lots of toys.”

For girls, Wal-Mart anticipates Littlest Pet Shop toys will be popular this season, along with 25th-anniversary editions of Cabbage Patch dolls.

For boys, the Nerf Vulcan, a fake gun, is expected to be a surefire hit.

Nationally, top toys for girls will be the ageless Barbie, Disney’s Hannah Montana, Bratz dolls and Nintendo Wii. For boys, video games, Nintendo Wii and LEGOS will be popular, the NRF predicted.

But even with the dawn-busting sales and cool toys for kids, consumers are bound to be wary and cautious as they head into a new year of uncharted economic waters.

Expect them to buy small, said the NRF — inexpensive things like books, DVDs and CDs, and traditional winter wear.

“Americans may be hesitant to purchase expensive gifts this holiday season, but personal and practical gifts will resonate most with shoppers this year,” said NRF President and CEO Tracy Mullin.

 

Top Toys for Girls

1. Barbie

2. Disney Hannah Montana

3. Generic dolls

4. Bratz

5. Nintendo Wii

6. Video games

7. Elmo

8. Disney High School Musical

9. Disney Princess

10. American Girl

 

Top Toys for Boys

1. Video Games

2. Nintendo Wii

3. LEGO

4. Generic cars

5. Transformers

6. Elmo

7. Star Wars

8. Hot Wheels

9. Remote-controlled vehicles

10 Xbox 360

— National Retail Federation

 

Origin of ‘Black Friday’

Its use goes back to the 1960s and Philadelphia, where it describe heavy traffic on the day after Thanksgiving. Now, it refers to the first day of the holiday-shopping season, in which retailers hope their sales will be in the black.