Where do we go from here?
With the market back at 1996 levels, it's sorely tempting to be a contrarian and call this a market bottom. Unfortunately, the hits keep coming:
-
Wells Fargo
(NYSE: WFC) became the latest banking giant to slash its dividend, whacking its once generous payout by 85% on Friday. - Kid apparel specialist Gymboree
(Nasdaq: GYMB) is expecting first-quarter comps to fall by a shocking 20% to 25%. - Shares of Blockbuster
(NYSE: BBI) took a 77% hit on Tuesday, after the company's hiring of a law firm to help it refinance its debt was -- perhaps wrongly -- interpreted as the first step toward bankruptcy. - The jobless rate rose to a worse than expected 8.1%.
- Even the mighty Warren Buffett kicked off the week on a grim note, posting Berkshire Hathaway's
(NYSE: BRK-A) (NYSE: BRK-B) biggest annual loss in his 44 years at the company.
It's clearly not easy to stay upbeat, even if you can identify companies that will be more relevant in the future. The old saying goes that it's always darkest before the dawn, but am I the only one afraid of dawn, because it means that a new trading day is just hours away?
Let me know when March Madness starts. It'll feel a lot better than March Sadness, that's for sure.
Briefly in the news
And now let's take a quick look at some of the other stories that shaped our week.
- Like many subscriber services, TiVo
(Nasdaq: TIVO) posted a sequential dip in subscribers during its latest quarter. The silver lining in the company's report is that losses were able to narrow substantially. This would be a welcome trend for Mr. Market. Companies have been scaling back payroll and lopping expenses. They are going to be well-oiled machines when sentiment turns positive. -
Amazon.com
(Nasdaq: AMZN) and Toys "R" Us are starting to allow customers to trade in used video games, in exchange for store credit. Yes, we've hit the bartering phase of the economic lull. Wake me up when the country's biggest retailers become consignment stores.
Until next week, I remain,
Rick Munarriz
