Monthly Archives: August 2010

Housing woes send stocks below 10,000 for second straight day

Dow now at 10,016, however, down 24 points from Wednesday’s opening.

NEW YORK (AP) — Stocks retreated again after another disappointing report on housing and weak durable goods orders brought more gloom about the economy.
The Dow Jones industrial average fell more than 50 points in morning trading Wednesday following news that sales of new homes fell last month to the lowest level on record. It was the latest indication that home sales are stagnating after the expiration of a homebuyer tax credit this spring.
A separate report from the Commerce Department showed that durable goods orders grew only slightly last month, falling shy of expectations and disappointing investors who had been hoping that the U.S. manufacturing sector would continue to pick up.
The newest signs that the economic recovery is sputtering led investors to move money into the relative safety of Treasurys, sending their yields lower. The yield on the 10-year Treasury note is now the lowest it’s been since January 2009, when the stock market was heading toward its lowest level in 12 years, and the yield on the two-year note is at a record low.
Stocks have been hit hard in recent days because of concerns about whether the economy will fall back into recession or at least be stuck in a prolonged period of very slow growth. The Dow is heading into its fifth straight day of declines.
New home sales fell 12.4 percent in July to an annual rate of 276,600, the Commerce Department reported. That was the slowest pace on records dating back to 1963 and worse than the pace forecast by economists polled by Thomson Reuters. A day earlier, the National Association of Realtors said sales of existing homes, a far greater proportion of the housing market, fell to a 15-year low in July.
The Dow Jones industrial average fell 51.61, or 0.5 percent, to 9,989.06 in morning trading.

Creating a process in which port projects get fully vetted

By Rachel Pritchett, reporter

It’s been said here and there during Port of Bremerton meetings that the Bremerton Marina might not have been built had the project proposal been more fully vetted.

And back when Cary Bozeman first came on board as CEO, it seemed like major new projects were appearing out of nowhere in front of commissioners, only to disappear just as quickly (a big hangar, sports fields, a incubator building, etc.).

Roger Zabinski, the port commission’s newest member and a scientist who’s very methodical and probably a bit of a wonk, presented a draft proposal Tuesday that would ensure projects get laid out on the table and examined from all sides — public included.

His two colleagues on the commission, Bill Mahan and Larry Stokes, appeared to like Zabinski’s proposal very much, as did much of the port’s senior staff. Tim Thomson, director of real estate and industrial park development, said the staff “embraces this approach.”

His plan, according to Zabinski, would go a long way toward rebuilding trust with the public, still angry over the $34 million marina that cost them lots on their property taxes and which still isn’t being used anywhere near capacity.

Zabinski is proposing a fluid project wish list with the most desired ones at the top. Project ideas could come from commissioners, staff or community members.

The projects would undergo a thorough vetting process that would include the public. Vetting would determine if a project fits with the port’s mission. It would look at cost and funding sources, and a timeline. And — this is a biggie for the public — the process also would look at return on investment.

Commissioners would make the final determination of what gets built and what doesn’t.

Mahan said to Zabinski, “You’ve brought something to us that probably should have been brought to us a long time ago.” He suggested the process only be applied just to major projects.

With that, the commission sent Zabinski’s proposal for some sane, transparent and measured consideration of big projects to staff members. They’ll translate it into a cut-and-dried process that, if adopted, will forever change the way the port goes forth with projects.

Tuesday stocks fall on July home-sales report

Dow now at 10,093, down 80 points.

NEW YORK (AP) — Stocks fell Tuesday after another disappointing report on the housing market renewed worries about the economy.
The Dow Jones industrial average lost 97 points in late afternoon trading after news that sales of previously occupied homes fell last month to their lowest level in 15 years.
The Dow briefly dipped below 10,000 for the first time in seven weeks and was down as much as 183 points earlier in the day before paring its losses. Investors seeking refuge from the latest stock swings piled back into Treasurys, sending interest rates lower. The yield on the two-year Treasury note touched another record low.
Global markets fell sharply. Japanese stocks led the way lower, falling more than 1 percent as the yen hit a fresh 15-year high against the dollar. Japan’s economy relies heavily on exports, so a stronger yen hurts the profits of major Japanese companies.
Stocks have been sliding in recent days as investors focus on signs that economic growth is slowing. A new wave of corporate dealmaking gave stocks a temporary boost Monday, but those gains quickly faded.
The National Association of Realtors said sales of previously occupied homes plunged 27 percent in July to an annual rate of 3.83 million, the lowest rate in 15 years. That’s much worse than the 4.7 million estimate from economists polled by Thomson Reuters. The 27 percent drop from the previous month was the biggest since record-keeping began in 1968.
Home sales have tumbled since a homebuyer tax credit expired at the end of April, despite mortgage rates falling to record lows. A stubbornly high unemployment rate of 9.5 percent has been keeping home sales down, and banks have also been cautious in making new loans.
“Without a boost in job creation, (buyers) just won’t have the confidence to step in and buy a new home,” David Katz, principal at Weiser Capital Management said.
In afternoon trading, the Dow Jones industrial average fell 97.33, or 1.0 percent, to 10,076.48. The Standard & Poor’s 500 index fell 11.57, or 1.1 percent, to 1,055.79, while the Nasdaq composite index fell 27.05, or 1.3 percent, to 2,132.54.
About three stocks fell for every one that rose on the New York Stock Exchange where volume came to 755 million shares.
Japan’s Nikkei stock average fell 1.3 percent after worries about the high yen hit share prices there.
In Europe, Britain’s FTSE 100 fell 1.5 percent, Germany’s DAX index dropped 1.3 percent, and France’s CAC-40 fell 1.8 percent.
The yield on the 10-year Treasury note, which moves opposite to its price, fell to 2.50 percent from 2.60 percent late Monday. That yield helps set interest rates on mortgages and other consumer loans.
The 10-year note’s yield continues to hover around levels not reached since March 2009, when the stock market hit a 12-year low and investors were concerned about the deepening recession. The yield on the two-year note went as low as 0.46 percent, another in a series of record lows.
Stock traders are “taking their cues from the bond market,” said Lawrence Glazer, a managing partner at Mayflower Advisors. “It really has been a dramatic and frightening shift” in Treasury prices, which has spooked investors and led to worries about another recession, Glazer said.
Reports due out later in the week will also provide insight into the health of the economy. Data on new home sales, durable goods orders, weekly jobless claims and consumer sentiment are scheduled for later in the week.
The government will also release a revised report on second-quarter gross domestic product. The broadest measure of the country’s total economic output is expected to be lower than initially thought, adding to concerns about the pace of the domestic recovery.

Monday stocks freeze in indecision

Dow now at 10,215, unchanged.

NEW YORK (AP) — Stocks fluctuated Monday as a fresh round of corporate dealmaking was tempered by continued skepticism about the strength of the economy.
Stocks got an early lift after a spate of new deals were announced, but the gains faded quickly. The Dow Jones industrial average fell 5 points in midday trading. Broader indexes also dipped.
Technology giant Hewlett-Packard Co. offered $24 per share for 3Par Inc. just one week after rival Dell Inc. agreed to buy the data storage provider for $18 a share. Meanwhile Potash Corp. of Saskatchewan Inc. formally rejected BHP Billiton’s $38.5 billion offer to acquire the fertilizer company.
European markets rose after banking company HSBC Holdings said it was in talks to buy a controlling stake in Nedbank Group Ltd. of South Africa from Old Mutual for as much as $6.8 billion.

Kitsap Business Briefs

Rice Fergus
Breaks Ground
for Building
Bremerton architectural firm Rice Fergus Miller has broken ground on its own new office building, “cutting holes” in the late 1940s Sears Tire Center in downtown Bremerton to create a new home.
The three-level building, with a mezzanine and open space cut through to the third floor, will house the firm and offer available lease space.
A spokesman for the firm says the re-use of an existing, vacant building is one of the most sustainable things the firm could do. The construction will include selective re-use of demolished materials from the building and source local goods.
The building will be 60 percent more efficient than the Washington State Energy Code requires. Plans include a hybrid natural/mechanical ventilation system, a super-insulated exterior skin and highly efficient windows. A 5,000 gallon rainwater harvesting system will supply 95 percent of toilet flushing needs over the course of the year and 100 percent of irrigation.
The project is tracking to be the first LEED Platinum building in Kitsap County and on the Olympic Peninsula.
Tim Ryan Construction of Poulsbo is the general contractor for this project.
Rice Fergus Miller is a full-service architecture, interior design and planning firm. To reach them visit or call (360) 377-8773.
Port Orchard
Marina Wins
EnviroStar Award
Port Orchard Railway Marina has been recognized as a Clean Marina through the EnviroStar, according to harbor master Capt. Gary McLaughlin.
Created in 2005, Clean Marina Washington identifies marinas which have taken positive and significant steps to manage and reduce waste and to improve the environment. A service of the Kitsap County Health District, EnviroStars recognizes clean business by awarding them a two-to-five star rating. Port Orchard Railway Marina has been awarded four stars.
South Kitsap
Salon Relocates
Cafe Soleil, a popular South Kitsap sun tanning and espresso cafe, has relocated to the corner of Sedgwick and Sidney roads in Port Orchard and expanded at the new location.
Owner Ronda Looney has complemented her tanning and espresso cafe with a hair salon. Local hair stylist Kathy Fitz, formerly of The Artistry Salon, will provide a full service salon. The salon has added two specialty tanning beds and a separate spray tan room.
The espresso drive up opens at 4:30 a.m.
The salon is located at 423 Sedgwick Road SW, Suite 101, in Port Orchard. Reach them at (360) 895-0989.
New Bridal Shop
Opens in Silverdale
Off the Rack Bridal Shoppe, a family-owned bridal shop selling new and used gowns and accessories, has opened in Old Town Silverdale.
The shop, owned by Mary Wiese, is located in a 100-year-old home and was furnished with only repurposed furniture and equipment.
Off the Rack is open by appointment Tuesday through Friday and from 11 a.m. to 5 p.m. Saturday at 9020 Washington Ave. in Silverdale. Reach them at (360) 865-0349.
Chicago Company
Picked to Supply
and Install
PSNS Equipment
Panda Machine Tools, Inc., of Chicago is being awarded a $10.9 million contract to supply and install a propulsion shaft lathe at Puget Sound Naval Shipyard. Work is expected to be completed by August 2012. Eight bids were received. The Fleet and Industrial Supply Center Puget Sound is the contracting activity.
On the Job
w Art Castle of Kitsap Home Builders Association has been awarded the Hummingbird Award from The O’Brien & Company, the first to receive the accolades outside the firm. For the past year the award has been given internally to honor those who have contributed through their creative energy to the company’s mission of sustainability. Castle was honored for developing the first industry-based and voluntary green building rating program, which now is a national, among other accomplishments.
w Douglas Berger of Silverdale recently was honored with the Tom Gorman Award, the highest level of achievement by the Association of Professional Investment Consultants. Berger was APIC’s president in 2007-2008. He helped develop its educational curriculums and demonstrated the ability to effect change in collaboration with management of the firm.
Kitsap Sun staff

Friday stocks slide as investors continue sell-off

Dow now at 10,180, down 90 points.

NEW YORK (AP) — Stocks fell moderately Friday as investors continued a sell-off that began a day earlier over worries about the pace of the recovery.
Investors are finding little reason to buy. There are no reports due out that could negate Thursday’s disappointing news that growth in the domestic economy continues to slow. The Dow Jones industrial average fell nearly 90 points in afternoon trading, a day after falling 144. Broader indexes also fell moderately Friday and are on pace for a losing week.
“We’re not seeing any significant growth prospects,” said Peter Costa, president of Empire Executions. “Why be in the market if there’s no (near-term) prospects for growth?”
Oil prices extended their slide on worries that future demand will wane if economic growth remains tepid. Energy stocks were among the worst performers on the day, including oil companies Chevron Corp. and ConocoPhillips.
Overseas markets also fell, reacting to reports Thursday that initial claims for unemployment benefits in the U.S. rose last week and manufacturing in the Mid-Atlantic region shrank.
“We’re probably on a continuation from yesterday’s disturbing claims number,” said Paul Zemsky, head of asset allocation at ING Investment Management. “There’s really nothing to hang your hat on.”
Earlier this year, traders were worried Europe’s economy would slow down so much that it would put a drag on a global recovery. Now, economic reports are making investors worry that the U.S. economy will slow worldwide growth.
In afternoon trading, the Dow fell 89.80, or 0.9 percent, to 10,181.41. The Standard & Poor’s 500 index fell 7.89, or 0.7 percent, to 1,067.74, while the Nasdaq composite index fell 9.52, or 0.4 percent, to 2,169.43.
About three stocks fell for every one that rose on the New York Stock Exchange, where volume came to 633.5 million shares.
Volume has been exceptionally low in recent weeks, which has added volatility to the market. But many stock options are expiring Friday, which could be providing a lift to volume.
Data has shown in recent months that private employers are largely skittish about hiring new workers because they are unsure how strong business will be in the coming quarters. That, in turn, has people worried about their jobs and spending less. But until spending picks up, unemployment could remain high.
Mark Luschini, chief market strategist at Janney Montgomery Scott, said companies are also reluctant to hire because of worries about taxes and government programs like the health care reform passed earlier this year.
“The uncertainty that exists on regulatory and income taxes has (employers) in stall mode,” Luschini said. Companies are worried about whether higher taxes and costs associated to regulation reform will impact profit margins and cause shoppers to reduce spending if they are paying more taxes, Luschini said.
The unemployment rate remains at 9.5 percent and analysts widely agree it needs to fall to lead to a stronger rebound.
In corporate news, Dell Inc. reported a better-than-expected profit Thursday, due largely to increased technology spending by businesses. However, sales in its consumer personal computer division were flat compared with the same quarter last year — further evidence that shoppers are hesitant to buy new goods.
Hewlett-Packard Co. reported quarterly results that were in line with preliminary results it released earlier in the month. Its profit rose 6 percent. Unlike Dell, it had growth in its personal computer sales.
HP fell $1.07, or 2.6 percent, to $39.69. Dell shares fell 5 cents to $11.99.
Corporate mergers and acquisitions activity gave stocks a boost early this week, but has been since overshadowed by weak economic reports. Mergers and acquisitions activity is usually seen as a hopeful sign for the economy because it means companies are willing to spend money, betting that their businesses and the economy will grow in the coming quarters.
Benchmark crude for October delivery fell $1.15 to $73.62 a barrel on the New York Mercantile Exchange. Oil prices have steadily dropped throughout August because of concerns that demand will drop if the global economic recovery slows.
Chevron fell 87 cents to $74.97. ConocoPhillips dropped $1.30, or 2.4 percent, to $53.41.
Bond prices traded in a tight range. The yield on the 10-year Treasury note, which moves opposite its price, was unchanged at 2.58 percent compared with late Thursday. Its yield is often used to help set interest rates on mortgages and other consumer loans.
Overseas, Britain’s FTSE 100 fell 0.3 percent, Germany’s DAX index dropped 1.2 percent, and France’s CAC-40 fell 1.3 percent. Japan’s Nikkei stock average fell 2 percent.

Wednesday stocks are mixed, investors make few moves

Dow now at 10,400, minus 5 points.

NEW YORK (AP) — Stocks were narrowly mixed in listless trading Wednesday as investors found little reason to extend the previous day’s rally.
The Dow Jones industrial average fell about 4 points and all the other major indexes were narrowly mixed. Interest rates fell again in the Treasury market as investors kept seeking out more secure alternatives to stocks.
There was barely any news to motivate stock investors, and certainly not any that would persuade them to continue the rally that sent the Dow up 103 points Tuesday. There were no big economic reports planned Wednesday. On Tuesday, a stream of improving numbers fed the rally.
Retailers continued reporting their second-quarter earnings, and investors were ambivalent about the results.
Target Corp. missed analysts’ forecasts for its second quarter revenue and offered a muted outlook for sales for the rest of the year. But the company told analysts it hopes to offset weak sales with higher sales of groceries and its new discounts for credit card holders. Target initially fell sharply, then recovered to a moderate advance.
Meanwhile, BJ’s Wholesale Club Inc. lowered its earnings outlook for the year. Its stock dropped.
The reports came a day after Wal-Mart Stores Inc. and Home Depot Inc. issued numbers that were more upbeat. So investors were again presented with numbers that appeared contradictory, and that spelled more uncertainty about the economy.
Wednesday’s trading was muted, and that was to be expected after investors on Tuesday showed their first real enthusiasm for stocks in weeks and sent the Dow up 103 points. There were no big economic reports planned Wednesday. And any big gains were likely to be given back simply because investors don’t trust stocks to put together a solid advance.
The Dow fell 4.69, or 0.1 percent, to 10,401.01. The Standard & Poor’s 500 index rose 0.84, or 0.1 percent, to 1,093.38. The Nasdaq composite index rose 7.81, or 0.4 percent, to 2,217.25
Gainers were ahead of losers by 4 to 3 on the New York Stock Exchange. Volume was 316 million shares.
Treasurys remained a destination for investors seeking a safer place than stocks to put their money. The 10-year Treasury yield fell to 2.61 percent from 2.64 percent late Tuesday.
John Stoltzfus, senior market strategist with Ticonderoga Securities in New York, said the market is becoming increasingly dominated by a “What have you done for me lately?” attitude and responding to daily reports about the economy.
“We live from economic data point to economic data point,” he said. “That will probably continue at least until the end of the summer as we wait for some kind of catalyst that would give the market better definition.”
Volume was again extremely light, mostly because of vacations, but also because many investors don’t have enough of a sense of the economy’s strength. That’s making them hold off of any major moves.
BHP Billiton’s $38.5 billion takeover offer for fertilizer producer Potash Corp. of Saskatchewan turned hostile Wednesday. Potash had called BHP’s offer grossly inadequate. The announcement of the bid and Potash’s rejection Tuesday helped feed the rally in stocks. Mergers and acquisitions activity tends to lift the market because it shows investors’ confidence in the economy.
Target rose $1.22, or 2.4 percent, to $51.90. BJ’s fell $1.88, or 4.3 percent, to $41.43.
Overseas, Japan’s Nikkei 225 index closed up 0.9 percent. In later European trading, London’s FT-SE 100 index fell 0.8 percent. Germany’s DAX index fell 0.3 percent, while the CAC-40 index in Paris fell 0.7 percent.

Kitsap Unemployment Rate for July Continues Gentle Downward Slide


The unemployment rate came in at 7.1 percent for July, down from 7.3 percent the month before.

Huge gains in the private sector, a total of 300 jobs.

But that was offset by the sharp loss of 200 retail jobs.

Which came to a net private-sector jobs gain of 100.

On the government side, 200 jobs state and local level jobs were lost in Kitsap County in July. They appeared to be across the board. Federal level was stable.

Look for more soon.

Rachel Pritchett

Tuesday stocks rise on earnings, economic reports

Dow rises 143 points this morning, to 10,445.

NEW YORK (AP) — Investors regained their enthusiasm for stocks Tuesday, sending prices sharply after reports showed a slight improvement in the housing market and a big jump in industrial production.
Investors were also encouraged by earnings from Home Depot Inc. and Wal-Mart Stores Inc. that were better than expected. The Dow Jones industrial average rose 144 points in midday trading. All the major stock indexes were up more than 1 percent.
Economic reports in recent months have almost exclusively pointed to slowing growth. Weakening data has led some investors to worry that the country could fall back into recession. The data Tuesday provided a slice of optimism and some reassurance that the economy continues to expand, albeit slowly.
“The data and earnings should ease people’s concerns about a double-dip” recession, said Peter Bible, a partner at EisnerAmper. “We’re anemic; we’re slow; we’re crawling, but we’re not going backward.”