What Gold and Oil are Saying (aig)

The Fed is set to release data about lending from its discount window
during the financial crisis some time this week. Conspiracy theorists often
point to the Fed’s overnight lending as a sure sign that the financial
markets are manipulated with cash infusions by the Fed. Really, in a
general sense, these open market operations are there to provide short-term
liquidity to qualified banks to help them settle daily transactions. This
lending is also used to manage monetary policy on a daily basis.

Japan Stock Market Rebound and the Apple Complex (aapl)

The Nikkei took back nearly 500 points in
Wednesday trading. That’s what happens a central bank pumps nearly $700
billion into the banking system, as the Bank of Japan has.

The rally for Japanese stocks is not an indication
that the situation there is improving, or even stabilizing. The danger of
radiation leaks has increased. Clouds of radioactive steam still rise
into the air as workers struggle to keep spent nuclear fuel rods
cool.

Radiation from Japan Leaks into Global Markets

The Wall Street Journal reported today that troubles in Japan
aren’t staying on the island nation. Instead, they’re spreading
throughout the world.

From the Journal’s article, “Global markets plunged as deepening worries
over the specter of a nuclear power crisis in Japan in the wake of last
week’s earthquake and its economic implications sent investors scurrying
again for safety.”

This piece begs the question: what’s safe these days? Is the U.S. Dollar
safe? Are U.S. Treasuries safe?

The Apple Complex

That was quite a rally yesterday. A big drop in
new unemployment claims, some pretty good retail numbers from February,
and some hope that the Libyan situation may be nearing an end, bolstered
the good vibes from Wednesday’s ADP private payroll report and sent stock
flying higher.

The entire “Apple Complex” of did pretty well,
too…

The “Apple Complex” is an
open-ended growth story. When you start to imagine the potential of
global penetration for this new generation of devices and services, you
can get some pretty staggering numbers. That means we can use these
stocks as bullish indicators.

The Real Risk to Oil In the Middle East

It’s not Saudi
Arabia
the market is worried about.
Saudi Arabia is
quite wealthy. And while you can’t say that the people of

Saudi Arabiahave
American-like freedom, at least the ruling family spends money on
education, infrastructure and technology.

No, the fear is that protests will spread
to
Iraq,
Iran and
Kuwait. Those
countries represent close to 10 million barrels of daily oil production.
They are not politically stable. Disruptions to oil production in these
countries would have a huge effect on oil prices.

Cisco, Apple and the Nasdaq

For an economy that has been highly dependent on
government and corporate spending, Chambers’ outlook wasn’t very
encouraging. But on a day when Cisco was pounded for around 15%, and Google
(Nasdaq:GOOG), Microsoft (Nasdaq:
MSFT) and Apple
(Nasdaq:
MSFT)
all finished in the red, the Nasdaq as a whole actually posted a
gain.

Now, Apple alone accounts for 20% of the Nasdaq
100 (the 100 largest stocks on the Nasdaq). Throw in Google (4.2%),
Microsoft (3.6%) and Cisco 1.6%, and you’re looking at 30% of the Nasdaq
100. Nearly one-third of the Nasdaq 100 was lower on Thursday, easily the
most influential tech companies, and the Nasdaq managed a gain for the
day.