The Dow Rises as Oil Prices Ease
By Andy Serwer
Very appropriate. Blue chips beat techs. Hey, it’s been the case over the past five years, why not continue it today, on this, the fifth-year anniversary of Nasdaq's peak. Oil and interest rates slipped, helping stocks (except the oils!) Dow climbed 45 to 10,851. Naz fell one point and some change to 2059. Hey, watch me Norman Greenbaum ("Spirit in the Sky"! He lives in Northern California. But you could have guessed that. His tune was used in an Enron commercial!) I mean Andy Serwer, on CNN’s "American Morning" and "In the Money." Read Loose Change to read about Deep Blue’s discovery of Disney's private club! Here’s what is going on:
YARD: Delta warning again that it might go Chapter 11. Shouldn’t there be a rule that airlines can’t be allowed to fly (or other companies allowed to operate), after being in bankruptcy protection after six months? That you just have to shut it down? Would you go to a dentist in Chapter 11? Or a brain surgeon? Some day there may be hell to pay on this. DAL down over 11% today…. Why in the world is Toys "R" Us worth $5 billion? Good money after bad, if you ask me! (Kind of like "Good Loving Gone Bad.")…. Still no verdict in the Ebbers case. The jury did get its Domino's pizza, though! WHAT IS TAKING THEM SO LONG? Bet we get a verdict on Friday (before the weekend!!!)…. From AP: "Microsoft Corp. announced it was purchasing privately held Groove Networks, which makes software for online work collaboration, for an undisclosed amount." Groove founder Ray Ozzie is one of the creators of Lotus Notes in the 1980s. Ozzie will become one of Microsoft's three chief technical officers, reporting to Bill Gates. Microsoft rose 12 cents to $25.43. Ozzie gets rich again!!!
NASDAQ 5000: You can really see what a bubble tech stocks were. The Naz is down some 60% since March 10, 2000, when it peaked at 5,048. Yet, the S&P is down only 10% and the Dow is actually up almost 10%. (The Dow touched above 11,000 only a few times since 3/10/00 though.)Yes, stock like Broadcom and Cisco and Sycamore and CMGI are all off sharply since then, too. But many more names, theglobe.com, VA Linux, Pets.com, or whatever, are all gone. Very possible we won’t see Naz 5000 again in our lifetime.
BUFFETT: Funny, I hear that March 10, 2000—just as NASDAQ was peaking—Berkshire Hathaway was bottoming. It had declined from $80,000 a share and hit $40,000 a share on this day five years ago. (The only other time it dropped 50%, I’ve been told, is when it went from $800 to $400 MANY years ago.) So forgive me, I’m just getting ready to comment on Buffett’s annual letter. Here are some highlights that have been picked out mostly by one Very Smart Bird. (Thanks VSB!) Not a lot of fireworks this year… Buffett threw in the towel on a zinc recovery project, causing a write-off of $579 million… He bragged on the discipline of National Indemnity and rightfully so… Pricing in insurance will be less attractive in 2005… Still winding down derivatives contracts at Gen Re: The annual report put it like this: "Like Hell, derivative trading is easy to enter, but difficult to leave."…Clayton Homes is growing… Raw material costs increases are "staggering" for some of his operational businesses… Women may not be wearing more underwear, but Fruit is growing…flight services is improving… As for stocks, WB sold out HCA, which had a $665 million market value in 2003 and added White Mountains Insurance ($1.1 billion) (Hello John Byrne and George Gillespie) (White Mountains, btw, has gone from about $20 in 1988 to $667—no it doesn’t do stock splits either!)… As the report said: "We don’t enjoy sitting on $43 billion of cash equivalents that are earning paltry returns"…Lou Simpson still rocks… BRK owns $21.4 billion in FX contracts—up from $12 billion a year ago, (you know what that means!) Students from all sorts of schools will be visiting Berkshire this year: IU, Iowa, Dartmouth, FSU, ‘Horns, Aggies, Cardinals, Vol’, Quakes, among others….WB says boards should meet without CEOs present sometimes….Makes sense to me, Warren!
Nice to see photographer extraordinaire Michael O’Neill in the house! Also in the house Ross Kauffman, with his Oscar for best documentary, short subject: "Born into Brothels." That Oscar is heavy, Ross!!!… Deep Blue sent this: http://disney.go.com/inside/issues/stories/v050308.html …. March Madness has truly begun: Clemson beats Terps three times in a row, to make sure Maryland will not be in NCAAs—first time in 12 years…. WHY are there people like this: http://www.fieggen.com/shoelace/lacingmethods.htm …. Justin writes: "RE KIDS 'N' ROCK: We took our seven-year-old son and 10-year-old daughter to Blue Man Group—the kids were so excited they rushed the stage and were escorted back to their seats by Security/Event Staff. Also, when I was about 9 or 10, my two oldest brothers (Mike & Tom) took me to see Sly & Family Stone in Chicago's Grant Park. It turned into a riot when Sly did not show—tear gas, burned cops cars—great fun for me!"…. A kid like me: "BERLIN (Reuters) - Astonished German police picked up an eight-year-old boy at 3 a.m. who had accidentally set off to school thinking he was late, authorities said Thursday: