July 13th, 2011 Newsletter

 Tangents:

 Summer Reading:

TOLSTOY AND THE PURPLE CHAIR: My Year of Magical Reading

by Nina Sankovitch

HarperCollins

When her older sister died, Nina Sankovitch was determined to both honor her life and ease her own grief by reading a book a day.  Sankovitch’s memoir stands as a tribute to the power of books to enrich our daily lives.  

Fiction:

STATE OF WONDER

by Ann Patchett     

Even better than “Bel Canto”?  That’s what at least one early reviewer says of Ann Patchett’s latest.  I loved Bel Canto, so this will be at the top of my list this week.  This new novel is set in the Amazon, where a young pharmaceutical worker has been sent by her boss (who also happens to be her lover) to investigate the death of a colleague.

All hard work leads to profit; but mere talk leads only to poverty.

                                                                  – Warren Buffett

Did You Know?  

The precise origin of the phrases “bull market” and “bear market” are obscure. The Oxford English Dictionary cites an 1891 use of the term “bull market”. In French “bulle spéculative” refers to a speculative market bubble. The Online Etymology Dictionary relates the word “bull” to “inflate, swell”, and dates its stock market connotation to 1714. 

One hypothetical etymology points to London bearskin “jobbers” (market makers), who would sell bearskins before the bears had actually been caught in contradiction of the proverb ne vendez pas la peau de l’ours avant de l’avoir tué (“don’t sell the bearskin before you’ve killed the bear”)-an admonition against over-optimism.

By the time of the South Sea Bubble of 1721, the bear was also associated with short selling; jobbers would sell bearskins they did not own in anticipation of falling prices, which would enable them to buy them later for an additional profit.                                                                      

Photos of the day 

July 13, 2011

A group of Sri Lankan young Buddhist monks parade, seeking alms in Colombo, Sri Lanka. In Buddhism, giving of alms is the beginning of one’s journey to Nirvana, the state of perfect bliss. Eranga Jayawardena/AP

Europcar rider Thomas Voeckler (2nd l.) of France, wearing the yellow jersey, rides with the pack during the 11th stage of the Tour de France 2011 cycling race from Blaye Les Mines to Lavaur, France. Pascal Rossignol/Reuters

Market Commentary:

 Canada

By Matt Walcoff

July 13 (Bloomberg) — Canadian stocks rose for a second day as financial and energy companies advanced on speculation the U.S. may return to stimulus policies and demand for a haven from debt crises propelled precious-metals producers.

Barrick Gold Corp., the world’s largest producer of the metal, increased 2.6 percent as gold futures climbed to a record. Cenovus Energy Inc., Canada’s fifth-largest energy company, increased 2.1 percent as U.S. oil inventories dropped.

Teck Resources Ltd., the country’s biggest base-metals and coal producer, climbed 1.1 percent after China reported faster economic growth than most economists in a Bloomberg survey had forecast.

“It’s a lack of confidence in terms of what’s happening to the euro,” said Todd Johnson, a money manager at BCV Asset Management in Winnipeg, Manitoba, which oversees C$300 million ($313 million). “The U.S. debt-ceiling debacle and the dysfunctional politics make people realize they need more tangible hard currency, adding to demand for precious metals.”

The Standard & Poor’s/TSX Composite Index rose 90.87 points, or 0.7 percent, to 13,324.94.

The S&P/TSX rallied 3.5 percent from a seven-month low on June 17 through yesterday as gold stocks jumped 9.9 percent.

Three of the world’s five largest gold companies by market value, and eight of the top 20, are Canadian, according to Bloomberg data.

Gold has surged 6.7 percent since July 1 as investors speculated the European debt crisis will spread beyond Greece and the Aug. 2 deadline for raising the U.S. debt ceiling to prevent default neared without an agreement among lawmakers.                      

Gold gained 1.5 percent while silver surged 7.1 percent, the most in 27 months, a day after Moody’s Investors Service cut Ireland’s credit rating to below investment grade. The U.S. dollar dropped the most in three weeks today against a basket of world currencies.

Barrick climbed 2.6 percent to C$46.62. Goldcorp Inc., the world’s second-biggest gold producer by market value, increased 2.5 percent to C$52.12, extending its July advance to 12 percent. Tahoe Resources Inc., which is developing a silver project in Guatemala, soared 14 percent to C$19.92.

North American Palladium Inc., a precious-metals producer in Ontario, jumped 18 percent, the most in 17 months, to C$4.51 after Leon Esterhuizen, an analyst at Royal Bank of Canada, raised his rating on the shares to “outperform” from “sector perform.”

Energy companies rose as natural gas futures advanced for a fourth day on forecasts for above-normal temperatures in the U.S. Stocks extended their gains after the U.S. reported a weekly drop in crude inventories more than twice as large as the median analyst forecast in a Bloomberg survey.

Cenovus climbed 2.1 percent to C$36.25. Trican Well Service Ltd., Canada’s largest oilfield-services company, rallied 5.4 percent to C$25.69. ARC Resources Ltd., which produces oil and gas in western Canada, increased 1.8 percent to C$24.50.

Trilogy Energy Corp., a western Canadian oil and gas producer, rallied 8.8 percent to a five-year high of C$27.45 after jumping 5.5 percent yesterday. Mark Polak, an analyst at Bank of Nova Scotia, called the stock a “top pick” July 11.

Producers of base metals gained after China, the world’s biggest user of the commodities, said its gross domestic product increased 9.5 percent in the second quarter from a year earlier. Economists had forecast economic growth of 9.3 percent, according to the median of 18 estimates in a Bloomberg survey.                    

Teck climbed 1.1 percent to C$49.73. Quadra FNX Mining Ltd., which produces copper in Canada, the U.S. and Chile, rose 3.1 percent to C$14.37. Ivanhoe Mines Ltd., which is developing a copper and gold mine in Mongolia with Rio Tinto Group, gained 2.3 percent to C$24.94.

Directory publisher Yellow Media Inc. sank 5.1 percent to C$2.25, extending its 2011 plunge to 64 percent, after Tim Casey, an analyst at Bank of Montreal, cut his rating on the stock to “underperform” from “market perform.” The shift to online listings from printed publications will reduce profit margins, Casey said in a note to clients.

Telus Corp., Canada’s third-largest wireless carrier, advanced 1.9 percent to C$54.27. Adam Shine, an analyst at National Bank of Canada, began coverage of the company with an “outperform” rating in a note dated yesterday. He cited the growth of the smartphone and wireless-data markets.

US

By Nikolaj Gammeltoft and Victoria Stilwell

July 13 (Bloomberg) — U.S. stocks pared gains, almost erasing a 164-point gain in the Dow Jones Industrial Average, after the Associated Press reported that House Speaker John Boehner said it’s a “crapshoot” whether the federal debt limit will be boosted if an agreement isn’t reached by Aug. 2.

AP later updated its story, quoting Boehner as saying “it’s a crapshoot” to determine what would happen if the limit isn’t increased. The Standard & Poor’s 500 Index advanced 0.3 percent to 1,317.72 at 4 p.m. in New York. Earlier, it climbed 1.4 percent after Federal Reserve Chairman Ben S. Bernanke said he’s prepared to provide more stimulus if needed and China’s economic growth beat estimates. The Dow rose 44.73 points, or 0.4 percent, to 12.491.61.

“The market took the reported information for what it is worth and traded off sharply on it,” said Philip Orlando, the New York-based chief equity market strategist at Federated Investors Inc., which oversees $354.9 billion. “The market has the potential to recover tomorrow based upon a restatement of what the speaker felt he said.”

Have a wonderful day everyone.

Be magnificent!

I see things with an intense joy,

and while I observe, there is no observer, only a beauty almost like love.

For an instant, I am absent, myself and my problems, my anxieties, my troubles: nothing but this wonder exists.

-Krishnamurti, 1895-1986

As ever,

Carolann

Every great advance in natural knowledge has involved

the absolute rejection of authority.

  -Thomas H. Huxley, 1825-1895