Daily Intent

I encourage you today to take a walk down main street.

It is very easy to hole up during the winter months, leaving others to walk the streets and get to know what is going on around town.  It is cold.  It is rainy.  It is dark.

Toughen up a little.

The only way you are going to find the deals, see the opportunities and broker the transactions that were discussed in last week’s Market Street Report (Art dealer occupying empty office space for FREE), is by walking the streets, observing the changes structurally and also psychologically, and talking to the people.  How are the human patterns changing?

Don’t leave it up to the newspaper to tell you a restaurant has closed or opened.  Get down on the street.

End your business lunch with a 15 minute walk around town, discussing the changes.

Your physical and business health will benefit.
 
Buzzword: Eat Your Own Dog Food
“An expression describing the act of a company using its own products for day-to-day operations.

A company that eats its own dog food sends the message that it considers its own products the best on the market.

This slang was popularized during the dotcom craze when some companies did not use their own products and thus could “not even eat their own dog food”. An example would’ve been a software company that created operating systems but used its competitor’s software on its corporate computers.”  Investopedia.com

Is the government authorities eating their own dog food?

  Six Points to Ponder:

   1. $3.55 Trillion Budget.  $1.75 Trillion deficit ahead - Obama outlines budget.  $634Bn for Universal Health Care.  The rich cringe.  They are expected to pay.
   2. Markets are flat on the week.  The Dow at 7353, 30pts down since last week.  S&P 500 at 773 and the Nasdaq at 1443, both a few points up since last week.  Oil at $44, up $6.
   3. Existing home sales for January were at their lowest levels since July ‘97.  Median prices are down as well.  Though the West saw an increase in sales.
   4. Stress Test - Banks to undergo hypothetical models to ensure stability.  How best to “Mark to Market” still the biggest question mark.
   5. Conforming (Agency Jumbo levels) will be returning to their 2008 levels.  For Santa Barbara we’ll return to $729,750.  Mortgage rates are up on the week.  Ted spread is back over 1%.
   6. Baseball: Pro - Spring training kicks off.  Ben Julianel in the Big League camp.  College ball - Bret Bochsler starts to heat up, hits 2-run 400ft jack to lead team back into the top 10 in Division 2.

Positives:

    * The budget deficit is projected to be back down to $500Bn by 2013.  If you agree with Universal Health Care, this could be a huge step in the right direction.
    * The market had some nerve racking drops early in the week.  Being back to levels with last Thursday is a good feeling.  Banks, those most badly beaten down, are leading the daily climb upwards.  JP Morgan laying off thousands within WaMu (not a humanistic positive but a stock positive).  Ken Lewis’ statements reassured many…Countrywide’s refinance levels providing greatness!
    * The West’s homes were the first to drop, now they are stabilizing.  Our region seems to be creating a bottom and picking up prices at levels where rents and mortgage payments are coming into align.
    * Ben and Bret are finding their niche.  Coming to a stadium near you.

Negatives:

    * Trillion dollars in deficit is hard to overcome.  We have the Baby Boomers ready to claim their Social Security checks in 2013, which is exactly when we are expected to fall back into the $500Bn deficit range.  Who is to pay?
    * The housing market continues to suffer nationwide which hurts our abilities to price out distressed debts and mark-to-market.  If the government buys these assets below market value, the banks could fall into a tailspin.  If they buy them at too high of levels, the US taxpayers would be on the hook to over pay.
    * The Ted spread monitors the market’s risk levels priced into lending rates.  If it increases, it is an indicator that your rates aren’t as low as they could be due to increased overall risk. 

Services: Market Clarity
Concerned you don’t fully understand what is going on in the markets?  I’d be happy to chat and give you a basis of understanding.  Please don’t hesitate to call me, anytime.
Local:

Anthony Bourdain - “the bad boy of cuisine”
Where: The Arlington
When: Friday, 8pm
Cost: $18 - $33
Why: “Description: Anthony Bourdain has been dubbed ‘the bad boy of cuisine’ for his rock star look and blunt observations about the world of restaurants, chefs and cooking.”

Live and Be Well,

Jeff Bochsler