Retail sale, oil price and HP merger on Dow Jones Dr. Warren Huang

April retail sales has been distorted by advance payment for low end consumer goods (below 400 dollars out of gasoline, food payment left from 600 stimulus package for rebate check, as already shown on surge on March credit card). While the big tocket above 400 like computer, automobile plunged due to recesion impact. This one time spike only help second quarter barely escape recession. The economy will follow housing price slump and job cuts into inflationary recession again. I predicted last Sept on this blog that Fed aggressive rate cuts will drag dollar, driving oil to 130, commodities price more than double and soaring inflation, 10 year bond yield break 4 % this summer, eventualy stock market bear correction. I have speaking to dozens US and European structural finance finance and central banks governors conferences since 1999 and 2003 that ABS na MBS, CDO based on statistical asset priceing and credit default rating will lead to betting on the wrong side of interest rateas and trillion dollar loss in US and European housing bubble burst and mortgage, credit crisis. I warned on Deal journal few days ago,that HP csh buy out low end low profit margin data processing company EDS to compete with IBM will not work. It need high end strategic BPO strategic supply demand chain to compete with Oracle, IBM. HP stocks plunge drag Dow down 40 points. I also warned last week market speculators use dollar rebound, and oil price setback to drive up Dow is not sustaonable, due to oil price will keep making new high due to rebate check and consumer peak summer demand, and dollar will be traded in narrow range due to US housing market slump. Today oil soared to new high, Dow lose ground even Dollar up to 104 Yen details on daily blog
Comment by Warren Huang Wall Street Journal Market Beat Blog- May 13, 2008 at 6:39 pm

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