Market Talk

Dow Jones’ Roger Cheng reports:

BlackBerry maker Research In Motion (RIMM) might be a bit late to the game, but it finally unveils its highly-anticipated tablet computer and operating system in an effort to attract more consumers.

WSJ has the details, including this great paragraph describing where RIM currently stands among consumers:

The announcements come as RIM revamps its iconic BlackBerry smartphones—originally made for businesses to handle email—for a market driven increasingly by consumers looking for fast handsets and cool software. Users and developers complain BlackBerry’s operating system is slow, clunky and lacks fun apps; the handsets are facing tough competition from Apple’s iPhone as well a handsets that run on Google Inc.’s Android operating system, particularly in the critical U.S.

On paper, Research in Motion’s Playbook tablet has a lot going for it, including a dual-core processor, full Flash, two high-definition cameras, and USB ports.

But in the end, it’s still all about the applications. RIMM faces the same dilemma Palm did with its new smartphones: an unproven product that may not attract app developers like Apple (AAPL) or Android.

RIMM is spending the latter half of its presentation focusing on “Super Apps” and making life easier for developers. IDC’s Al Hilwa notes that it will still take some time to build up the number of apps available to the product, which runs on different software than Blackberrys.

The Playbook, unlike the Blackberry, will not feature a cellular connection. So who will sell the tablet? RIMM has traditionally relied on its wireless carrier partners to push Blackberrys, either to business customers or consumers. But without a 3G connection, there really isn’t any motivation for the carriers to sell the Playbook.

Will RIMM try its hand at the direct retail business? More likely, it will rely on a retail partner like Best Buy (BBY).

Research in Motion shares were recently up 1.2% to $48.95 in after-hours trading.

- VIX volatility index can be a great contrarian indicator — problem is, it’s a backward-looking gauge, Tom Petruno says.

- Crude oil’s getting sneaky high and no one seems to care. “One explanation is that oil prices haven’t climbed as fast as they did in early 2008, with the slope of the ascent being a primary source of worries,” Paul Kedrosky writes.

- “The key to long term economic health, though, will be a greater contribution from exports and less on borrowing and spending all over again,” Peter Boockvar notes.

- He’s chairman and CEO of the world’s largest health-care conglomerate, Johnson & Johnson (JNJ), but yesterday Bill Weldon took on a new role: blogger.

- Twitter users will not abandon the microblogging service just because it will start running search-based advertising, Forrester analyst Josh Bernoff says.

- Rumor du heure for Palm: Let Intel buy them, Jason Perlow writes.

- Google (GOOG) reportedly developing a new tablet device compatible with Android would be great for Adobe (ADBE), but not so good for Apple (AAPL).

- Tech blogger Om Malik gets his hands on Microsoft’s (MSFT) new Kin smartphones, but doesn’t exactly offer a stellar review.

- “If the US economy was about to reach “escape velocity” as Larry Summers says, small business optimism would not be in the gutter and sinking,” Mish says.

- “We live in an age of unprecedented bailouts,” Simon Johnson writes. “The Greek package of support from the eurozone this weekend marks a high tide for the principle that complete, unconditional, and fundamentally dangerous protection must be extended to creditors whenever something “big” gets into trouble.”

- “Here we are, up 70% or so from the lows of over a year ago, and there is no uniformity of thought – which is probably a good thing,” Barry Ritholtz says.

- Treasury’s Geithner insists a resolution authority will help manage a failure of a large cross-border financial institution. “It simply will not,” former IMF chief economist Simon Johnson writes. “Mr. Geithner wanted to sound tough. But is he really coming out to fight? Or did he and his colleagues already throw in the towel?”

- Palm hopes distribution deal with AT&T (T) will boost sagging smartphone sales, but analysts aren’t so sure, John Paczkowski reports.

- “The home buying tax credit expires at the end of April and time is running out,” Miller Tabak’s Peter Boockvar says. “Bottom line, the next big test for this phase of the housing recovery is just ahead.”

- February existing home sales are proof the home buyer tax credit “has run out of gas,” Karl Denninger writes at the Market Ticker.

- Year-over-year decline in housing inventory is getting smaller. “This is something to watch,” Calculated Risk says. “This slow decline in the inventory is especially concerning with 8.6 months of supple in February – well above normal.”

- “Once upon a time, you could set your watch with the Google-Goldman super-tell duopoly,” Todd Harrison says at Minyanville. “As both are pointing due south today, it’s worthy of a mention.” Google (GOOG) drops 1.5% to $549; Goldman Sachs (GS) drops 0.8% at $174.83, but the Dow Jones Industrial Average rises 103 points.

- UK authorities arrested of six men, including an employee of hedge fund Moore Capital and another from Deutsche Bank, in what’s being billed by the government as a major crackdown on insider trading, WSJ reports.

- Solar stocks, which got hit hard during the bear market, have been really struggling during the recovery, Bespoke notes. For solar stocks over the last six months, “it’s not a pretty sight,” firm says. “Is now the time to buy or will solar continue to trade lower?”

- Jeff Saut, Barry Ritholtz, Bob Doll and Mike Santoli all correctly called the bull market, Josh Brown writes at The Reformed Broker.

- Microsoft (MSFT) doesn’t want to talk about the Courier, a rumored response to Apple’s (AAPL) iPad, but it’s willing to concede the blogosphere is a great way to read about it. All Things Digital says MSFT’s JobsBlog tells those looking for a job to check out “online chatter” about, among other things, “the upcoming Courier digital journal.” The JobsBlog links to a post on Engadget that claims exclusive pictures and details.

(UPDATE: Looks like someone at Microsoft’s (MSFT) JobsBlog might be in trouble. MSFT has now deleted a reference to its rumored Courier tablet from a JobsBlog post. “Hilarious,” All Things D’s Peter Kafka tweets. The post is still on JobsBlog but no longer mentions the Courier.)

- Stocks rebound nicely today after rough few weeks, validating research from UBS and JPMorgan, each saying they aren’t worried about the bull market’s sustainability, FT’s Alphaville blog says.

- Amazon gives in to rising e-book prices. But “bear in mind that publishers will actually make less money with the Apple pricing plan,” MediaMemo blogger Peter Kafka says.

- January was a tough month for risky assets as stocks, REITs and commodities all fell substantially while bonds generally held their own, James Picerno notes at The Capital Spectator. Doesn’t mean a new bear market is beginning, but it does show the days of “strong, sustained rallies in everything” are probably over. “The money game now appears destined for a more complicated era.”

- The once-robust charity sector hit with mergers, closings. “Hit by a drop in donations and government funding in the wake of a deep recession, nonprofits—from arts councils to food banks—are undergoing a painful restructuring, including mergers, acquisitions, collaborations, cutbacks and closings,” WSJ says.

- Insider buying picked up a bit last week. but the trend of low levels of buying and continued high selling remains intact, Pragmatic Capitalist says.

- Mark Cuban offers advice on a simple way to create jobs: reduce paperwork. Small businesses and entrepreneurs should spend less time and money on lawyers and accountants and “redirect that intellectual and financial capital to the core competencies of their business,” he says.

- DVD sales are collapsing, nearly as quickly as music sales did over the last decade,” Kafka says. Not good, especially since Hollywood studios are desperately looking for new revenue streams to replace the struggling DVD (hence their big push for a 3-D boom.)

- A $100 million bonus for Goldman Sachs (GS) CEO Lloyd Blankfein? Don’t count on it, Reuters blogger Felix Salmon notes. “It frankly boggles the imagination that he’s going to get anywhere near $100 million,” Salmon says. “Goldman knows that bonuses are a hot-button issue politically, and it’s going to keep them (relatively, by its standards) modest for 2009.”

- Toyota says it’s already begun shipping a fix to the gas pedal problem involved in the recall of millions of vehicles. Time’s John Curran highlights the “Toyota Stimulus.”

- Yahoo (YHOO) and AP reach new licensing agreement; web portal will continue hosting AP articles. “The agreement could help define a core issue facing news organizations: How to deal with the Internet portals that help distribute their material but that some publishers say unfairly profit from their work,” WSJ says.

- Overseas stocks ahead of US on correction course. “But note: Over the last year, foreign stocks have mostly followed the US market trend, not led it,” Tom Petruno says. “At this point, they probably don’t have a message for Wall Street so much as they’re looking for a message from Wall Street.”

- “Millions” of Kindles flying off Amazon’s shelves. TechCrunch’s Michael Arrington pegs it at 3 million.

- Hard to draw conclusions in this complicated market. “The markets right now are especially complicated and appear to be facing fundamental things that it has either never faced or not faced in modern times,” says Roger Nusbaum, portfolio manager at Your Source Financial.

- S&P 500 crashes through support. Traders had been watching 1080-1085 level. So much for the strong opening. “The reversal today was telling,” FusionIQ CEO Barry Ritholtz says.

- It’s getting ugly out there. “This type of action, when the market trades sharply down even though economic reports and earnings reports both beat estimates handily, is not good,” Bespoke says. “There’s simply no way to sugercoat it.”

- Seems like Apple hasn’t lost affinity for AT&T. “Apple has been happy with the company as a carrier partner and is confident of its plans to vastly improve its network,” Digital Daily blogger John Paczkowski says.

- Pressure on the euro accelerates as currency falls below $1.39 for first time in more than six months.

- Might be a little soon to talk about “post-crisis” times, Pimco CEO Mohamed El-Erian says. “Too many markets, too many institutions have assumed this would happen quickly,” he notes.

- AIG releases list Of troubled derivatives contracts. AIG says in SEC filing that it’s releasing documents “due to recent public disclosure of the full contents of Schedule A,” a detailed listing of $62.1 billion in notional value derivative transactions its financial products group wrote.

- This blog needs more Gaga!

How do you like them apples?

I’m tired.

Physically I’m fine. But I’m mentally drained keeping up with the ridiculous amount of Apple (AAPL) coverage that has been floating through the blogosphere this week. Considering all the attention the iPad’s unveiling received, one would’ve thought the cure for the common cold was discovered.

Hey, we’re just as guilty as the next news guy, as Apple stories have been splashed all over The Wall Street Journal (and this blog) all week long. A vast majority of my posts this week have been, in one form or another, about Apple.

And guess what? It makes me sick. Because I’m just another cog in the Apple machine.

This is exactly what Apple wants – and it’s absolutely genius. The company leaks some details about a hip new product a few months before its release and then lets the blogosphere do the legwork. Tech bloggers drum up buzz, piecing together as many details as they can about what Apple has up its sleeve. By the time the product is actually released, everyone knows what’s coming. Keep in mind, too, that all this marketing and PR doesn’t cost Apple a dime.

It’s amazing – I dare you to name one other company that can drum up half as much interest about their products, without publicly saying a word, like Apple does.

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- So much for all the political drama surrounding Bernanke’s confirmation. Senate votes 70-30 to reappoint Bernanke for second four-year term as Fed chairman.

- Seamy AIG bailout details aren’t exactly flattering for the Fed. “No matter which way you look at it, the picture that is emerging of the Federal Reserve, as revealed by the ongoing probes into its AIG bailout, is singularly unflattering,” Yves Smith writes at naked capitalism.

- Is the decline in emergency claims a blip on the screen or start of a new trend? Next week should offer better clues. “Bottom line, the labor market data in terms of hiring is still very cloudy and the pace of firings has stopped getting better,” says Miller Tabak’s Peter Boockvar.

- Year-long downward trend in initial jobless claims seems to remain intact, but job growth doesn’t seem to be coming anytime soon. “The great question is whether we can generate net growth on a sustained basis,” James Picerno writes at The Capital Spectator. “We are knee-deep in the middle of this transition and early clues of how the shift is faring will come,” over the next few weeks.

- Still, the four-week moving average of initial jobless claims rose for the third consecutive week, a trend that will “drive both the Fed and the administration crazy if it lasts too much longer,” Mish says.

- With Google (GOOG) out of the picture, local review site Yelp turns to Elevation Partners for funding. “The Elevation bet means any public offering has likely been pushed back by a year or more,” MediaMemo blogger Peter Kafka says.

- Newsosaur blogger Alan Mutter rounds up a list of media pundits who are skeptical that Apple’s (AAPL) iPad can save the struggling print media.

- Kansas City Fed President Thomas Hoenig’s dissent yesterday doesn’t necessarily represent a huge shift in FOMC’s policy environment. “I find it inconceivable that the Fed would be keen on normalizing rate policy without a substantial decline in unemployment, absent of course an unexpected surge of inflation,” Tim Duy writes at Economist’s View.

- A frosty January for stocks and what some folks think it means looking forward.

- J.D. Salinger passes away at 91.

US stocks remain down, although they’re sharply off the lows with only 30 minutes remaining in today’s session.

Hard to pinpoint exactly what’s driving today’s move. Technology leading the declines a day after Apple’s (AAPL) iPad announcement. Jobless claims and durable goods reports also came in below expectations. S&P 500 up held at support around 1080, so there’s that to consider as well.

But, as Tom Petruno points out, it just seems investors are finding more reasons lately to sell rather than motivation to buy. And issues overseas may be the biggest factors driving this recent slide. From LA Times’ Money & Co blog:

Europe may be the bigger worry at the moment. Stocks were broadly lower there today amid more signs of contagion from Greece’s financial woes. Investors continued to demand sharply higher yields on Greek government bonds, even though the country successfully borrowed more than $11 billion early this week via five-year notes to give itself more breathing room.

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Knew this hill had a downside.

US stocks taking it on the chin this afternoon, with technology sector getting slapped around the hardest – off more than 3%.

Worse-than-expected weekly jobless claims and durable goods reports this morning, as well as some disappointment surrounding Apple’s (AAPL) new tablet, weighing on stocks. But it also seems like this is just another pullback amid the larger correction the market has been experiencing throughout the last two weeks.

And the Dow Jones Industrial Average is slip-sliding away back toward the always important, from a psychological point at least,  10000 level.

It seems as if investors are largely ignoring many of the better-than-expected earnings reports recently, suggesting the bulls’ 10-month run may be running out of steam. Since the Dow’s close on Jan. 14, it has dropped about 625 points, or 5.9%.

DJIA and S&P 500 are both on pace to close lower for the third consecutive week. Each are set to record their longest weekly losing streaks since July 10. And if current trends hold true, January is turning out to be the worst month for stocks since February 2009.

From a technical perspective, keep an eye on 1085 as a closing level on S&P 500, FusionIQ CEO Barry Ritholtz says. “A close below this sets up another 5% leg down towards 1035 area,” he notes.

Dow industrials were recently off 151 at 10084; S&P 500 down 17 at 1080.

To say the blogosphere is buzzing about the iPad is certainly an understatement. It seems like everyone has something to say about Apple’s (AAPL) new device.

From your typical tech blogs, to twitter, to even Paul Krugman, folks everywhere are weighing in on the new tablet. Some positive thoughts, fair amount of skepticism, but for the most part people seem excited to get their hands on the device and test it out.

And for Apple, this is all unfolding exactly according to plan. And if it seems like it’s a plan that’s been implemented before, well, it has. Seems like Apple’s got a blueprint for how they do this stuff, doesn’t it?

Phase one of a typical Apple product announcement is now complete as months of hype and speculation gave way to the iPad’s actual unveiling, David Pogue chronicles on his NYT blog.

Now phase two – blogger bashing and criticizing of the yet-to-be released product – is beginning and will continue over the next few months until the iPad actually goes on sale, he says.

“Then phase three will begin: positive reviews, people lining up to buy the thing, best-sellerdom, and the mysterious disappearance of the basher-bloggers,” Pogue notes.

So what’s the takeaway? IPad has vast potential, but “it’s too early to draw any conclusions,” he says. “And anyone who claims to know what will happen will wind up looking like a fool.”
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