Last week's revelation of over 40K workers added to the unemployment lines was unwelcome. The number came in at 448K on a running monthly basis, just plain ugly. Please refer to our Saturday piece "Positives and Negatives at Equilibrium" for more commentary. POTC does not see any quick relief in sight, except for the infrastructure plan we've been clamoring for in the last several weeks. Since lowering interest rates would equate to an economic 'suicide solution', only the Keynesian argument, embraced by ex-Pres candidate Huckabee, has merit. http://en.wikipedia.org/wiki/Keynesian_economics
Would many be opposed to a government stimulus package focused on building out U.S. infrastructure, better and newer bridges, roads, waste and water plants? That makes better sense to POTC than sending out $600 or $1,000 checks, agree? Before market earnings from: Corrections Corporation of America (CXW) Q2 2008, estimate for $.29 POTC feels these shares make sense in an environment with 5 year high unemployment: http://www.correctionscorp.com/about/
After market earnings from: Deckers Outdoor Corp. (DECK) Q2 2008, estimate for $.23, World Fuel Services Inc. (INT) Q2 2008, estimates for $.49
Friday, August 8th brings no market moving economic data. Before market earnings from: DrilQip Inc. (DRQ) Q2 2008, estimate for $67, Mirant Corp. (MIR) Q2 2008, estimate for $.54, OYO Geospace Corp. (OYOG) Q3 2008, estimate for $.54. We recommend buying shares of DRQ and OYOG on pullbacks, as the Obama drilling sentiment could grow legs when the House and Senate birds return from their migration patterns. DRQ and OYOG are just two companies positioned to benefit from drilling, so counting out the all important fossil fuels is not recommended on this Island. The Psychology of the Call team.