I hate to say I told you so, but I told you so.  The New Orleans Saints came back from a 10-0 deficit to stun Peyton Manning and the Indianapolis Colts with a 31-17 win in Super Bowl XLIV.

The Saints were the hungrier and better coached team, and they executed their game plan flawlessly.  Precise accuracy and stellar play from Drew Brees, no turnovers, sure tackling, special teams’ superiority, and clutch defense.  Despite allowing the vaunted Colts offense a lot of yards, they held them without points in five of their final six drives.  Sean Payton is an emerging star as a head coach and he not only used the two weeks leading into the game to put together a brilliant plan of attack, but also to convince his team that it was their time, and motivate them to prove all the so called pundits wrong.

It was a really good Super Bowl.  Very entertaining, and champs we can all feel good about. 

And I’d be remiss if I didn’t mention what a great game former Buckeye Malcolm Jenkins played.  MJ was all over the field.

Also, a reminder, The Melt is being featured tonight on “Diners, Drive-In’s, & Dives” on the Food Network.  Show airs at 10 PM.

Quote of the day …

“We just believed in ourselves.  We knew we had an entire city, maybe an entire country behind us.  I’m just feeling it was all meant to be.  It was all destiny.” ~ New Orleans Saints QB and Super Bowl XLIV MVP Drew Brees, after his team’s 31-17 win over the Indianapolis Colts

Market …

After a couple of hectic weeks of earnings releases and key economic indicators, things slow down a bit this week.  Outside of Thursday’s 8:30 AM releases of first time unemployment claims and January’s retail sales totals, there’s not a lot of economic news coming out this week.

After ten months of rallying since hitting 12-year lows last March, it’s been a rough last 3 weeks for stocks.  The Dow Jones Industrial Average has fallen about 800 points since January 19^th as investors continue to become increasingly skeptical about the slow economic recovery the country finds itself mired in.

News …

~ Saints Win First NFL Title by Beating Colts 31-17

http://apnews.myway.com/article/20100208/D9DNVJ6O0.html

~ ‘Historic’ Snow Storm Shuts Down Federal Government

http://apnews.myway.com/article/20100207/D9DNJULO1.html

~ Geithner: No Double-Dip Slump But Recovery Slow

http://www.cnbc.com/id/35289931

~ AP Analysis: US Economic Stress Hit Peak in December

http://finance.yahoo.com/news/AP-analysis-US-economic-apf-3597455065.html?x=0&sec=topStories&pos=2&asset=&ccode=

~ Stock Futures Edge Lower After G7 Meeting

http://www.marketwatch.com/story/us-stock-flat-to-lower-after-g7-meeting-2010-02-08?dist=beforebell

No Mo?  No Delonte?  No Boobie?  No problem.  The Cavaliers just keep on rollin’.  Last night, already without their starting backcourt from last season, they also found themselves without third string point guard Boobie Gibson for the first half, who was tending to his pregnant fiancé (R&B singer Keyshia Cole).  It didn’t matter.  Despite not really playing anyone shorter than 6’6 in the first half, the Cavs plodded to a four point halftime lead, then just systematically beat Dwayne Wade and the Miami Heat into submission in the second half, cruising to a 102-86 win, their tenth straight.

You watch this Cavs team play … they toy with teams they know they can beat.  Like a boxer ahead on the cards, they pace themselves throughout stretches of the fight, then just take things to another level as the bout enters the championship rounds.  Being at this one last night, I could just see the transformation take place.  Cavs stretched the four point halftime lead out to about 12.  Miami fought back to get it back down to four.  LeBron gave a little head nod and a wink to the fellas.  Fifteen minutes later … Wade and the Heat were slumped on their stool in the corner, their cutman furiously trying to stop the bleeding.  Five minutes after that their corner threw the towel in.  Ball game.

I haven’t had this much fun watching a regular season Cleveland sports team since the 1994 and 1995 Indians.  It’s a special group.  All very likable guys.  That genuinely like one another.  If this team gets broken up, it will be devastating to me.

This has gotta be the year.  Right?  Let me kick the ball Lucy!

I might be overthinking this, but I’m predicting the Saints to win the Super Bowl on Sunday.  31-30 … on a Drew Brees TD pass to Marques Colston with about 30 seconds left.  How can I pick against Peyton Manning?  How can I go against a team that won every single game they tried in this year?  I just think people are focusing too heavily on the last games that these teams played … where Manning and the Colts looked amazing in barnstorming back to beat the Jets, and the Saints were outplayed at home by the Vikings.  Just because Manning blistered the Jets two weeks ago doesn’t mean you can’t slow him down.  Baltimore did a very good job against him in the Colts first playoff game.  Also, the Saints are a big play team.  If they can get one big scoring play defensively or on special teams, and can get touchdowns instead of field goals in the red zone, I feel they can and will win this game.  Lastly, they have an all-world quarterback of their own.  And the better coach.  Sean Payton is an offensive genius.  And with two weeks prep time, I feel this benefits Payton and the Saints more than it does Jim Caldwell and the Colts.

I just feel like it’s the Saints time.  And I think they think it’s their time.

Either way, I am going to enjoy it.  You gotta love Super Bowl Sunday.

Quote of the day …

“We’re going to win on Sunday.  I guarantee it.” – New York Jets quarterback Joe Namath’s famous guarantee before Super Bowl III

Market …

We got the big employment report this morning.   And it was a total mixed bag.

In a big surprise, the national unemployment rate fell from 10.0% to 9.7%.  Expectations were that it would stay the same or tick up slightly to 10.1%.  However, a sharp increase in the number of people giving up looking for work helped to depress the jobless rate.  The number of ‘discouraged job seekers’ rose to 1.1 million in January from 734,000 a year ago.

As far as the economy adding or losing jobs in Jan, the economy actually shed another 20,000 jobs.  Expectations were that between 10,000 and 50,000 jobs were added to the economy in Jan.  Also, The Labor Dept revised the job #’s from the past two months, saying the economy shed 150,000 jobs in Dec, compared to 85,000 previously reported, but Nov was revised to a gain of 64,000, up from the 4,000 that was reported.  Annual benchmark revisions to payrolls data showed the economy has purged 8.4 million jobs since the start of the recession in December 2007.  That’s a sobering #.

The markets aren’t sure how to react.  Stock futures were down before the release and are rallying.  Treasury and mortgage bonds have been all over the board, and are now down slightly.  One interesting note is that the Fed Funds future markets are pricing in a much stronger likelihood of the Fed raising rates at their March and April meetings as a result of the drop in the unemployment rate.

News …

~ National Unemployment Rate Falls to 9.7%, Lowest Level Since August

http://www.marketwatch.com/story/jan-jobless-rate-falls-to-97-lowest-since-aug-2010-02-05

~ Obama Plans to Expand Some Small Business Loans

http://www.cnbc.com/id/35253467

~ Dow falls below 10,000 for First Time Since Nov 6

http://www.cleveland.com/business/index.ssf/2010/02/dow_falls_below_10000_for_firs.html

~ World Stocks Hit by Fear of Debt Crisis Contagion

http://finance.yahoo.com/news/World-stocks-hit-by-fears-of-apf-3223111389.html?x=0&sec=topStories&pos=1&asset=&ccode=

~ Futures Pare Losses After Unemployment Rate Declines

http://www.marketwatch.com/story/us-stock-futures-pare-losses-after-unemployment-rate-declines-2010-02-05

Appointment viewing, 8:15 PM tonight on TNT.  Cavaliers/Heat.  LeBron v. Dwayne Wade … in a rematch of their scintillating second quarter showdown in Miami a couple of weeks back where the two stars scored 23 consecutive points on a mind-boggling array of highlight film three pointers, slam dunks, and amazing drives to the basket.  The pair combined for 37 second quarter points in total in a game the Cavs ended up eeking out on a LeBron James steal and pair of foul shots with just seconds remaining.

Every time these two teams play, it seems like LBJ and DWade put on a show.  And just in case you’ve been living inside a cave, the Cavaliers have won nine straight games and stand at 39-11, the best record in the entire NBA, and 5.5 games up on Orlando for the coveted #1 seed in the Eastern Conference.  The Heat lost their third straight game last night in Baaaaahstan, and has fallen below .500 at 24-25 on the season.  Were the playoffs to start today, Miami would actually be the #8 seed, and the Cavs first round opponent.

More on the Super Bowl tomorrow, but we should have a great game on our hands this Sunday.  I’ve been up in the air on this game for the last week.  Peyton Manning is playing on a level right now that I don’t think I’ve ever seen a quarterback perform at in my lifetime.  Every game the Colts have tried to win this season, they have.  And I just don’t think the Saints have the defensive backs to keep up with Wayne, Clark, Collie, and Garcon.

Just something about this Saints team though.  Every single person I’ve talked to expects the Colts to not only win, but to do so by more than 5.5 points.  Whenever that happens, the opposite usually happens.  Ask the 2001 and 2007 Patriots.  And I can’t help but think there’s not a destiny thing going on with this Saints team given the great story behind the team and the city in the wake of Hurricane Katrina.

Quote of the day …

“Any time you give a man something he doesn’t earn, you cheapen him. Our kids earn what they get, and that includes respect.” ~ Woody Hayes

Market …

The wave of employment news continued this morning, and this latest update was not a good one for the economy.  First time unemployment claims, a weekly indicator used to gauge the health of the jobs market here in America, rose by 8,000 from 472,000 to 480,000 in the most recent week of data.  Economists had expected first time claims to fall to about 450,000.  The rise is the fourth in the past five weeks.  The four-week average, which smoothes fluctuations, rose for the third straight week to 468,750.  The figure is the highest total in the past two months, and pretty much erases any hopes that the lower jobless claims totals we saw in late December were the beginning of a trend that would lead to consistent job growth here in the first quarter of 2010.

Of course, this news comes on the heels of tomorrow’s vital employment report.  Already huge releases each month with massive market moving potential, the monthly jobs reports (released on the first Friday of every month) have been even more in the spotlight as of late as the economy looks to emerge from the worst recession in 80 years, and cannot do so without more people being put back to work.  Expectations were for the unemployment rate to remain at right around 10.0%, and for the economy to have added 20-30k jobs in January.  This news this morning will temper those expectations, and the early market activity since the jobless claims release this morning is evidence of that.  Stock futures are down, and safe haven fixed income assets like treasuries and mortgages are rallying.

News …

~ Jobless Claims Unexpectedly Rise, Productivity Up 6.2%

http://www.cnbc.com/id/35233130

~ Retailers Report Modest Sales Gains in January

http://www.cnbc.com/id/35205999

~ Mortgage Demand Picks Up Ahead of Expected Rise to Rates

http://www.mortgagenewsdaily.com/consumer_rates/132989.aspx

~ Obama Administration to Supple 1 Billion to Small Banks

http://www.cleveland.com/business/index.ssf/2010/02/obama_administration_to_provid.html

~ Futures Lower on Surprise Rise in Jobless Claims

http://www.thestreet.com/_yahoo/story/10674110/1/futures-lower-on-surprise-rise-in-jobless-claims.html?cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA

Do the Cavaliers need to make a trade?  The NBA trade deadline is looming.  The Cavs are kicking the tires on potential deals for a big forward to replace J.J. Hickson in the starting lineup and really fill out their already talented team.  Washington’s Antawn Jamison and Indiana’s Troy Murphy are the two most likely targets … though the recent injury to the Hornet’s Chris Paul could put David West back into play as well.

There are two schools of thought on this.  The first is that the Cavs must do everything humanly possible to win a title this season.  It’s been 46 years since Cleveland has won a championship, LeBron James’ contract is up at season’s end, and we felt really good last year about our chances before the team was absolutely ham-hawked in the Eastern Conference Finals by Orlando.  With four good teams in the East (Hawks, Celtics, Magic the others) and the Lake Show looming as a probable Finals opponent, the team is going to have three consecutive seven game series that are going to be very difficult.  And while this team is rolling now, and has great depth, you can’t be deep enough in the playoffs, and you never know when an injury can strike and affect that aforementioned depth.

Then there’s the school of thought that this team is indeed good enough and that there’s no need to deal young talent and risk upsetting chemistry.  We have the best record in the league, the best depth in the league, and are just annihilating good teams (like Memphis last night) without key guys like Mo Williams and Delonte West.  Any type of deal that will yield anything relevant will mean the team will have to move lifetime Cavalier and legendary good guy Zydrunas Ilgauskas (his expiring contract is what teams are interested in), promising young forward J.J. Hickson, and probably a draft pick or two.

I have no problem trading Hickson.  He has potential, yes.  But he’s been primarily the benefactor of LeBron and Shaq double teams this season, and about 70% of his field goals are rim-rattling dunks, making him seem more valuable than he is.  He’s still a liability defensively, and still can’t box out consistently to keep the opponents off the glass.  In the playoffs, the team would be hard pressed to be able to count on him for anything more than the first six minutes of the 1^st and 3^rd quarters before they bring in Varejao, who the team prefers to use as the sixth man.  Getting a guy like Jamison or Murphy to plug into Hickson’s spot in the starting lineup is clearly appealing, and would make this team scary.  And I’m not sure Hickson’s upside is anything more than former Cavalier airhead Drew Gooden.

At the end of the day, I think what it’s going to come down to is Ilgauskas.  If the Cavs can deal him to a team that would agree to buy his contract out in 30 days (at which point he could be resigned by the Cavaliers) I think they’ll be willing to strike a deal.  Not only do the Cavaliers think the world of Big Z, but they (rightly) feel he still has value to this team.  If they can get a team like Indiana or Washington to agree to buying him out, then it all comes down to what the Cavaliers are offering versus what someone else may be offering.  To a team that’s out of it, a 12 million dollar expiring contract (which frees up cap space, takes dollars off the ’10-’11 payroll), a promising young player like Hickson, and a first round pick … it’s a pretty appealing package.

And by popular request, a couple pictures of “Patches”:

Quote of the day …

“Experience taught me a few things. One is to listen to your gut, no matter how good something sounds on paper. The second is that you’re generally better off sticking with what you know. And the third is that sometimes your best investments are the ones you don’t make.” ~ Donald Trump

Market …

Jobs, jobs, jobs.  That’s going to be the focus of all the financial markets for the remainder of this week.

Friday is the big national employment report.  Expectations are that the unemployment rate in the US will remain at right around 10.0%, and that the economy actually added a small amount of jobs (estimates are 10,000-30,000) in January, which would be just the second monthly gain in the last two years.  Tomorrow, we get first time jobless claims.  It’s also expected to improve.  Last week there were 470,000 people who filed for unemployment for the first time.  This week the # is expected to be about 450,000.  And this morning … we got the ADP private sector employment report, which does not include government jobs.  ADP reported that private sector firms shed 22,000 jobs in January, which was actually a little better than the -30,000 # that was expected.  Additionally, ADP revised December’s private sector job losses down from 84,000 to 61,000.

The slightly better than expected news has investors more bullish about the aforementioned jobs reports, which will follow in the coming days, and has helped stock futures, which were poised to open down after two days of gains.  And it’s hurting safer fixed income assets like treasuries and mortgage backed securities.  Market rate MBS are down 6/32 (about 20 basis points) in early trading.

News …

~ Private Sector Sheds 22,000 Jobs in January says ADP

http://www.marketwatch.com/story/private-sector-sheds-22000-jobs-in-jan-adp-says-2010-02-03?dist=beforebell

~ Challenger: Planned Layoffs Rise for First Time Since July

http://www.marketwatch.com/story/planned-layoffs-rise-for-first-time-since-july-2010-02-03?dist=beforebell

~ Mortgage Applications Hit Six-Week High on Increased Refinances

http://www.cnbc.com/id/35213452

~ Obama Budget Attacked, Defended

http://www.marketwatch.com/story/obamas-budget-plan-defended-on-capitol-hill-2010-02-02?dist=beforebell

~ PNC Repays the Loan Used to Purchase National City

http://www.cleveland.com/business/index.ssf/2010/02/pnc_repays_its_76_billion_gove.html

~ Study: Consumers Pay Credit Cards Before Mortgage

http://www.cnbc.com/id/35212475

~ Stock Futures Mixed After Jobs Data

http://finance.yahoo.com/news/SP-Nasdaq-futures-fall-after-rb-319337887.html?x=0&sec=topStories&pos=main&asset=&ccode=

Abbreviated version of the Dish this morning.

In over seven years of writing “The Dish”, I don’t think I’ve ever recieved as much feedback as yesterday’s fish story generated.  I was besieged with a bevy of emails on black patch disease, goldfish care, and heart warming stories of the things people do for their children.

None were as great as this actual e-mail I got from my wife right around the time I sent it out yesterday though:

OK, I have had it with this fish!  It looks no better even with the medicine.  The water looked bad again today and I realized the filter stopped working b/c the stupid red and orange and yellow chips that kept moving when the fish moved clogged the filter!  So I again had to clean the tank out, remove all those chips and just use the blue marbles.  I better not be able to catch this fish disease!  I am done with this fish and do not care about the $40, I think it is just time to get rid of it and leave it at that.  I really do not think Nicholas will really care after a few days.  If you decide to keep the fish the tank cleaning is all yours!!!

The Oscar Best Picture nominations are out:

Avatar
The Blind Side
District 9
An Education
The Hurt Locker
Inglourious Basterds
Precious
A Serious Man
Up
Up in the Air

More on these in the coming weeks.

Quote of the day …

“You can fool all the people some of the time, and some of the people all the time, but you cannot fool all the people all the time.” ~ Abraham Lincoln

Market …

Markets are waiting on a pending home sales report this morning.  In advance of that, stocks and mortgages are flat.

Financial regulation will likely grab the spotlight again today, as former Fed Chairman Paul Volcker is slated to testify before the Senate Banking Committee at 2:30 PM EST.  Volcker is expected to press for restrictions on banks’ proprietary trading, in line with President Obama’s proposal last week.

News …

~ Key US Regulator Warns on Securitization Rules

http://www.cnbc.com/id/35197313

~ Obama to Unveil Aid Proposal for Small Businesses

http://www.cnbc.com/id/35194618

~ Bank of NY Mellon to Buy PNC Services Unit for 2.3 Billion

http://www.marketwatch.com/story/bny-mellon-to-buy-pnc-services-unit-for-23-bln-2010-02-02

~ Fifth Third Sued Over Overdraft Policies

http://news.cincinnati.com/article/20100201/BIZ01/2020344/1001/BIZ/Fifth+Third+sued+over+overdraft+policies

The things you will do for your kids.  This summer, we’re at the Solon Home Days.  My son Nicholas wants to play that game where you try and throw the ping pong ball in the mini-fishbowls to win a goldfish.  Improbably, he sinks what I now refer to as the “hundred dollar ping pong ball”.

So we’re driving home and it hits my wife and I.  We have no fish bowl.  We have no fish food.  We now have a fish.  Off to the pet store we go.  And it should be noted, my wife and I are not pet people.  Along with our love of Chloe from “24”, it’s one of the few things we have in common.  Nothing against animals.  Love other peoples pets.  Both cried at the end of “Old Yeller”.  Just no desire to own one.

We walk in the pet store with the goldfish in the plastic baggie in our hand.  And if you are a pet store employee, this is the holy grail.  This is what you sit around and wait all day for.  The clearly clueless suburbanite parents to walk through the doors with the goldfish bag in hand and the kids in tow.   They need equipment, food, supplies.  You can play to the emotions of the kids to try and move additional pets. 

An hour later (twenty minutes of which was spent explaining to my son why guinea pigs are secretly evil and are prone to bite little boys) we walk outta there $60 lighter in the pocket.  A big tank, food, an electric filter, pellets for the water, decorative stones, a fake plant for the tank, a Sponge Bob fish tank ornament, and yes … two more fish.

Predictably, the carnival fish dies within days, and the traumatic experience of his “burial” is not easy to go through with my son … who still asks “is Marvin still down there” when going potty.  One of the store bought fishes (Fredo) passes the next day.  Within a week, we’re down to just one fish, ironically named Patches, who’s still with us … at least for the time being.  I say ironically because Patches started getting these nasty looking black patches on his body.  Resigned to his fate, I had “the talk” with my son about Patches.  15 minutes and all kinds of guilt later, I am online Googling “goldfish black patch disease”.  We find out it’s a common ailment, usually caused by my wife someone not cleaning the tank often enough.  So instead of calling Kevorkian, we’re off to the pet store again to get the medicine.  As well as all kinds of new accessories for the tank.  Another $40.  The hundred dollar goldfish. 

No ping pong ball has had this much impact since the one that delivered LeBron James to Cleveland.  This fish will live another 5 years even if I have to have the top veterinarian in the country flown in to operate on him.  It’s gotten personal.

The things you will do for your kids.

Quote of the day …

“A pessimist is one who makes difficulties of his opportunities and an optimist is one who makes opportunities of his difficulties.”  ~ Harry Truman

Market …

January is in the books.  And it was a rough start to 2010 for the stock market.  The Dow Jones Industrial Average started the year at about 10,600 before topping out at roughly 10,720 on January 19^th … then just tanked into the final bell Friday, ending the month at 10,067.  The jobs #’s continue to be depressing, and stock investors have not liked President Obama’s promises to impose heavy fees on banks and raise taxes on the wealthy.  While these are things that the populace of this country is overwhelmingly in favor of, Wall Street feels it will lead to higher rates and fees for consumers, and that tax increases of any kind are going to negatively impact consumer spending at a time when we need it most.  Also, while many of the fourth quarter 2009 earnings reports we’ve seen these past two weeks have bested expectations, the future economic outlooks of these companies as we get deeper into 2010 has been underwhelming, muting any lift the markets would have normally gotten off those earnings reports.

So that’s really where we stand as we head into the second month of 2010.  The country needs to create jobs, and Obama has wisely made it his highest priority.  But it costs money to create jobs, and with a massive record deficit, that money has to come from somewhere, hence the proposed tax increases for the wealthy.  It’s an easy place to go for it, and the public opinion polls support the decision.  We’ll see how it all plays out.

We’ve got another big week of economic indicators ahead of us, headlined by Friday’s employment report.  Expectations are that the national unemployment rate will remain at 10.0% (maybe tick up to 10.1%), and that the economy added roughly 50,000 jobs in January.  Today, we get info on construction spending and the ISM Index (national survey of purchasing managers that gauges manufacturing activity).  Tomorrow, the pending home sales index is released and Treasury Secretary Timothy Geithner testifies before the Senate Banking Committee about the 2011 budget.  On Wednesday we get the ADP private employment survey and Federal Reserve Governor Kevin Warsh delivers a speech on regulatory reform to the New York Association for Business Economics.  Thursday, we get data on first time jobless claims, productivity, and factory orders.  And Friday … the big employment report at 8:30 AM EST.

News …

~ New Foreclosure Filings Remain High in Cuyahoga County, Elevated in Suburbs

http://blog.cleveland.com/metro/2010/02/new_forclosure_filings_in_cuya.html

~ The Week Ahead: Markets Optimistic Ahead of Data Flood

http://www.mortgagenewsdaily.com/02012010_week_ahead_employment.asp

~ Obama Unveils $3.83 Trillion Budget with Massive Deficits

http://finance.yahoo.com/news/Obama-unveils-383T-budget-apf-3449890447.html?x=0&sec=topStories&pos=2&asset=&ccode=

~ White House: Stimulus Has Created 600,000 New Jobs

http://www.cnbc.com/id/35172131

~ Fed’s Bullard: US Deflation No Longer a Risk

http://www.cnbc.com/id/35139336

~ Stock Futures Point to Higher Open

http://finance.yahoo.com/news/Stock-futures-point-to-higher-apf-105375914.html?x=0&sec=topStories&pos=3&asset=&ccode=

It’s hard to think about baseball with the weather this cold … but we’re just a little over three weeks away from pitchers and catchers reporting to Spring Training. 

It could be a long year for the Tribe.  They’re expected to be one of the worst teams in baseball and lose close to 100 games.  Last year they finished 65-97, and they added nothing of significance this off-season.  And unlike last season, they go into 2010 without even one starting pitcher that is anything close to a sure thing in the rotation.  The fact that the team is hopeful that Jake Westbrook (who missed all of last year and has a reconstructed right elbow) will be their opening day starter says it all.

Weird things can happen in the sport of baseball though.  And these past 6-7 years, the times the Indians have had good teams … it’s been when we were least expecting it.

The Indians offense was average to above average last year, and that was without Grady Sizemore for much of the season.  Guys like Michael Brantley, Luis Valbuena, and Matt LaPorta (all expected to be starters this year) started to come on late.  And players like Asdrubal Cabrera and Shin-Soo-Choo had breakout seasons and appear poised to do even more here in 2010.  I’m not worried about the offense.  And if LaPorta and mega-catching prospect Carlos Santana live up to the hype, the offense could be very good.

It all comes down to the pitching.  I think the bullpen has the potential to be pretty good, and one thing we’ve seen with the Indians this past decade is that the years they’ve been good have been the years they’ve had good bullpens.  We’ve got Kerry Wood at the back end, and Chris Perez and Tony Sipp really emerged last season and could be dominant 8^th inning guys for us.  There are some other intriguing arms that should fill out the pen for us.  The rotation is a huge question mark though.  Westbrook is coming off elbow surgery and Carmona has been maddeningly unable to harness his talent and get people out.  We need those two guys to anchor the top of the rotation if the Indians have any chance of playing meaningful games in the fall.  You’d hope that former #1 pick David Huff (who won 11 games last season) and Justin Masterson (centerpiece of the Victor Martinez trade) would fill in the 3 and 4 spots.  Leaving Carlos Carrasco (acquired from Philly in the Cliff Lee trade), promising prospect Hector Rondon, and holdovers Aaron Laffey and Jeremy Sowers to compete for the final spot.

Bottom line, the Indians are counting on a lot of young players this season.  Many things would have to go right for the team for them to have a chance at staying in the race into September, even in a division as weak as the AL Central.  It doesn’t lessen my excitement for the start of the season one iota though.

Quote of the day …

“I’m going to give you a little advice. There’s a force in the universe that makes things happen. And all you have to do is get in touch with it, stop thinking, let things happen, and be the ball.” ~ Chevy Chase, as Ty Webb, in the comedic classic ‘Caddyshack’

Market …

Well, the recession is officially over.

That doesn’t mean the recovery isn’t going to be slow, painful, and that the unemployment picture here in America won’t remain poor for some time.  I believe they will.

But this morning’s announcement from the Commerce Department that fourth quarter GDP (Gross Domestic Product, the measure of the size of the US economy as a whole) rose 5.7% really puts an official end to the worst recession we’ve seen in this country since the 1930’s.  It’s the second straight quarter of growth after four consecutive quarters of decline.  The report provided an upbeat end to an otherwise dismal year: The nation’s economy declined 2.4% in 2009, the largest drop since 1946.

It’s not all wine and roses with this # though.  Even though the results bested economist’s expectations of growth of roughly 4.6%, the better than expected expansion in the fourth quarter was fueled mostly by companies refilling depleted stockpiles, a trend that will eventually fade.  Additionally, economists expect growth to slow this year as companies finish restocking inventories and as government stimulus efforts fade.  Many estimate the nation’s GDP growth will slow to a 3.0% rate in the current quarter and to about 2.5% for 2010 as a whole.

Still, the markets are going to like this.  This news, on top of better than expected earnings reports from Amazon, Microsoft, and Mattel … and Big Ben Bernanke’s Senate confirmation (markets like Big Ben) yesterday, and we should see a good day for stocks.  And a not so good day for safer fixed income instruments like treasuries and mortgage backed securities.

Have a nice weekend everyone!  A lot of good news links below …

News …

~ US GDP Surges 5.7% in the Fourth Quarter, Besting Expectations

http://www.marketwatch.com/story/us-gdp-surges-57-on-inventory-slowdown-2010-01-29?dist=beforebell

~ HAMP Guidelines Update to Improve Loan Mod Conversion Rate

http://www.mortgagenewsdaily.com/01282010_hamp_guidelines_updated_to_improve_loan_modification_conversion_rate.asp

~ Fed MBS Purchase Program: 89 Billion Left to Spend

http://www.mortgagenewsdaily.com/01282010_fed_agency_mbs_purchases.asp

~ Obama Retools Tax Credit Idea for Creating Jobs

http://finance.yahoo.com/news/Obama-retools-tax-credit-idea-apf-3205183263.html?x=0&sec=topStories&pos=2&asset=&ccode=

~ “Bank of America is Not Too Big” Says CEO

http://www.cnbc.com/id/35140158

~ Bernanke Confirmed: But Battles are Far From Over

http://www.cnbc.com/id/35124202

~ Barney Frank: Banks Complaining About Taxes is “Outrageous”

http://www.cnbc.com/id/35140455

~ Stock Futures Higher After Strong GDP Report

http://finance.yahoo.com/news/Stock-futures-higher-after-apf-1535724108.html?x=0&sec=topStories&pos=1&asset=&ccode=

Let it snow, let it snow, let it snow.  I’d never move away from Northeast Ohio, but if I did, I would miss never seeing snow.  That said, one of the most defeating feelings is when your driveway is buried under snow and ice for weeks.  You get a patch of 40-45 degree weather like we had last week.  You finally start to see the concrete again!  And one day, the driveway is gloriously clear.  Then you wake up the next morning and it’s buried under snow again.

I’ve been slacking on my movie watching.  I’ll blame football, the Cavs, the Wii, and a lack of good DVD releases these last few months.  The latter all starts to change now, as many of the Golden Globe and expected Oscar nominated films start to come out.  I’ll say this – I can’t wait to see “Up in the Air” … I’ve heard phenomenal things about it from all the people who’s opinions I trust.  And I’ve loved the last two films from director Jason Reitman, “Juno” and “Thank You For Smoking”.  Currently, I have a couple highly regarded foreign films at home as well as Tarantino’s latest.  Next up in my Netflix queue are “The Hurt Locker” and a couple of the other award nominated films already out on DVD.  Also season one of “Mad Men”.  I’ve simply heard too many good things about that show and have decided to try and go back and start watching the old episodes.

In some Cleveland sports news, my good friend and TheClevelandFan.com writer Paul Cousineau is hosting All Bets Are Off on Sports time Ohio today from 3-6.  It’s actually an all TheClevelandFan.com show, with several of our writers coming on as guests.  And Kenny Lofton was inducted into the Indians Hall of Fame.  Will Kenny make the Baseball Hall of Fame in Cooperstown?  Hard to say.  I’d say Kenny, Omar, and Thome all have good chances.  Manny was a shoe-in before the steroids suspension.  Fodder for future versions of The Dish …

Quote of the day …

“It takes 20 years to build a reputation and five minutes to ruin it.” If you think about that, you’ll do things differently.” ~ Warren Buffett

Market …

Let’s get right to it.  All kinds of news today and all kinds of good linkage in the News section below. 

Let’s start with the Fed.  First off, in a surprise to no one, they agreed to keep it’s target interest rate near zero, and said the weak economy and subdued inflation “are likely to warrant exceptionally low levels” for interest rates “for an extended period.”  That’s the same wording we’ve been seeing since the Fed lowered rates to these levels in December of 2008.  But, in a change, the decision to keep that wording wasn’t unanimous.  One member of the panel, Thomas Hoenig, “believed that economic and financial conditions had changed sufficiently that the expectation of exceptionally low levels of the federal funds rate for an extended period was no longer warranted”.

The Fed also said it will follow through with plans to end a $1.25 trillion program to support the mortgage market by the end of March, and taper off other special lending programs by Feb 1.  As we’ve mentioned several times before in The Dish, mortgage rates are a byproduct of what people will pay for mortgage backed securities (pools filled with individual mortgage loans, which are sold as investments).  The biggest buyer, by far, is leaving the market in two months.  Most people expect rates to rise as a result of this.  Others feel it should have and would have happened already … and are today pointing to the fact that mortgages have hung in there on the heels of this announcement as evidence of that.  We’ll see.  I do think a steepening of the yield curve is likely as we head into spring.  And if I’m a borrower on the fence, I am locking my rate today.  That said, I wouldn’t rule out the Fed still having a trick or two up their sleeve.  And would not rule out another little refinance boom with 30 year fixed rates in the 4’s at some point here in 2010.

State of the Union.  Obama basically threw in the towel on his health care plan, moving a job creation plan to the forefront.  He offered no specifics on his bank overhaul plan.  He promised a freeze on government discretionary spending for three years, starting in 2011.  He railed on partisan politics and lobbyists, blaming them for the failure to get health care reform done.  And touched on some of the ways his economic stimulus plan has helped put some people back to work and get the economy growing once again.

End of the day, nothing really unexpected from either the Fed or Obama.  Markets, as a result, haven’t really moved violently one way or another.

In other Fed news, Big Ben Bernanke’s confirmation vote is set to be held today in the Senate.  He needs 60/100 yes votes to essentially seal another term for him, and he’s expected to get it … but barely.  Did Big Ben make all the right moves when everything hit the fan 15 months ago?  No.  But he acted decisively, and in most cases smartly, to prevent a recession from turning into a depression, which would have been a disaster.

Lastly, on the economic news front this morning, the news wasn’t good.  First time jobless claims were expected to fall to about 450,000 this week after last week’s unexpected rise.  They really didn’t.  They fell by just 8k to 470,000 … another big miss and sobering reminder on the brutal state of the employment market here in America.  Also, durable goods orders (big ticket items ordered by businesses) rose far less than expected in December.  A 2.0% rise was anticipated.  Orders rose by just 0.3%.

The poor economic news has been somewhat mitigated by another wave of solid earnings reports.  Ford, Colgate, Proctor & Gamble, and AT&T all bested earnings projections for the fourth quarter of 2009.

News …

~ Obama Pushes Jobs, Vows to Fight On

http://www.cnbc.com/id/35119144

~ Fed’s Greenlee: Bank’s Still Aren’t Making Loans

http://www.cnbc.com/id/35108640

~ US 2009 Foreclosures Go Beyond Sun Belt States

http://www.cnbc.com/id/35055884

~ Treasury Department Readies Changes to Mortgage Relief Plan

http://www.cleveland.com/business/index.ssf/2010/01/treasury_department_readies_ch.html

~ First-time Jobless Claims Fall By Just 8,000 to 470,000

http://www.bloomberg.com/apps/news?pid=20601087&sid=a4ScH2Imsa2c&pos=2

~ Durable Goods Orders Gain Less Than Forecast

http://www.bloomberg.com/apps/news?pid=20601087&sid=aoRCHnBEpQFA&pos=1

~ Senate to Vote on Bernanke Today

http://finance.yahoo.com/news/Senate-to-vote-on-Bernanke-rb-2540255726.html?x=0&sec=topStories&pos=6&asset=&ccode

~ Stock Futures Rise on Upbeat Earnings Reports

http://finance.yahoo.com/news/Stock-futures-rise-on-upbeat-apf-1436636166.html?x=0&sec=topStories&pos=main&asset=&ccode=

~ AmTrust’s New Owner Says It Will Hire, Move Work Here

http://www.cleveland.com/business/index.ssf/2010/01/nycb_profits_soar_thanks_to_am.html

Here is an excellent quick, easy, tasty recipe.  Great fall/winter dish. 

20 Minute Chicken Minestrone

Put all this stuff in a large saucepan …

~ 4 cups water
~ 4 14.5 oz cans of diced tomatoes (the ones with garlic/onions, or Italian seasoned)
~ 3 large boneless, skinless chicken breasts, cut into bite size pieces
~ 3-4 cups uncooked rotini pasta
~ 2 envelopes of the Good Seasons Italian dressing mix
~ Seasonings. I use a little crushed red pepper, basil, oregano, garlic salt, and cracked pepper.

Bring it all to a boil. Then add roughly 4-5 cups of vegetables. I chopped up some mushrooms, green peppers, and carrots. (An easier, quicker alternative would be to add frozen vegetables. If you do that, add em in the beginning with the other stuff.)

Once you add the veggies, just let it simmer on medium heat for about ten minutes.

Ladle into bowls, top with a little grated parmesan cheese. Serve with some crusty bread.  Eat.

I am not a big soup guy.  To me, soup is an appetizer, not a meal.  This is a meal.  Feeds a family of four two nights in a row … and it’s even better the second day.  All the ingredients cost $16-$17.  For two feasts.

Quote of the day …

“Good leadership consists of showing average people how to do the work of superior people.”~ John D. Rockefeller

Market …

Big, big day when it comes to the future of the economy of this country.  We’ve got a Fed announcement on monetary policy coming at 2:15 PM and the President’s State of the Union address at 9:00 PM.  Between the two, we’ll find out a lot about the next steps of the US government in their quest to speed up the economic “recovery”, which is creeping along at a snail’s pace right now.

With the Fed announcement, there is little drama as to what they are going to with rates.  They are going to keep them at the historically low levels, just as they have for the last several meetings.  But that’s where the lack of drama ends.  Investors will have their eyes and ears peeled for any potential changes in the wording of the Fed’s statement, for their thoughts on the economic “recovery”, clues as to when they may start raising the overnight lending rates, and also whether or not it will stick to the plan to end a $1.25 trillion program of mortgage-debt purchases in March.  The Fed’s mortgage purchase plan has almost single-handedly pushed mortgage rates down to their lowest levels ever, which has helped the struggling housing market.  Many (most) people fear that if the Fed does pull their money out of the mortgage markets, rates will jump, and any progress made in the housing recovery over the course of the last year will come to a halt.

Not enough drama for you?  Big Ben Bernanke is also up for reappointment as Fed Chairman this week.  Once thought to be a rubber stamp approval, Big Ben has run into increased opposition from some Senators on Capitol Hill this week.  It’s still very likely Bernanke is reappointed.  His term ends Sunday.  Expect an official reappointment to be approved later this week.

In other market news, bank stocks continue to get hammered in the wake of Obama’s purported crackdowns.  Apple stock continues to fly off good earnings and rumors that they are about to release a new revolutionary tablet style computer.  And we get data on new home sales at 10 AM this morning.

But all eyes are on The Fed.

News …

~ US Home Loan Demand Slows, Refinancing Down

http://www.cnbc.com/id/35095841

~ Fed Begins Two Day Meeting as Bernanke Vote Looms

http://www.cnbc.com/id/35083061

~ Will Fed Policy Be Affected by Controversy over Bernanke?

http://www.cnbc.com/id/35083576

~ Geithner, NY Fed Defend Actions on AIG Payments

http://www.cnbc.com/id/35090876

~ Fed May Take Chance Ending Debt Purchase Program Won’t Hurt Housing

http://www.bloomberg.com/apps/news?pid=20601087&sid=axVV8waG7WMs&pos=1

~ Stock Futures Mixed Ahead of Open

http://finance.yahoo.com/news/Stock-futures-narrowly-mixed-apf-2131313936.html?x=0&sec=topStories&pos=1&asset=&ccode=

What a game last night in South Beach!  The Cavs and Heat played an instant classic, with the good guys prevailing 92-91 on a late steal and two resulting free throws from LeBron James that gave the Cavaliers the victory.  And while the ending was exciting, it was nothing compared to a stretch late in the first half that saw LeBron and Dwayne Wade combine to score 23 straight points on a dizzying array of three point bombs, amazing drives to the basket, and rim-rattling slam dunks.  When the first half ended, I just sat there staring at the TV, glazed over and drooling … trying to process what I had just seen: LeBron and DWade combining to score 37 points in the second quarter alone.

I said it before, and I’ll say it again.  Do not take for granted how lucky we are as Clevelanders to be able to watch LeBron do what he does 3-4 nights a week.  It’s like having young kids.  Everyone who has older kids tells you to cherish every moment with them, because you will miss it so badly when they’re grown.  When LeBron is done playing basketball here in Cleveland, be it in six months, or in sixteen years, you will wish that you had watched less “American Idol” and “Are You Smarter Than a Fourth Grader”, and more of one of the greatest athletes in the history of the world, performing in the peak of his career, with the word “Cleveland” written on the front of his jersey.

I got one of those Keurig one-cup coffeemakers for my birthday.  It’s easily one of the coolest gifts I’ve ever received.  No more dealing with the pain of making a pot of coffee, tossing half of it down the drain, then dealing with the messy cleanup after.  Fill the thing with water once every couple days.  Open the lid, pop a K-Cup in there, and you have a piping hot, fresh brewed cup of coffee in 30 seconds with nothing to clean up. 

Quote of the day …

“A man must know his destiny… if he does not recognize it, then he is lost. By this I mean, once, twice, or at the very most, three times, fate will reach out and tap a man on the shoulder… if he has the imagination, he will turn around and fate will point out to him what fork in the road he should take, if he has the guts, he will take it.” ~ General George S. Patton

Market …

Some overseas news and concerns about the global economy are weighing on the markets this morning.  Two big pieces of news.  Fourth quarter GDP (Gross Domestic Product, measure of the economy as a whole) growth over in Britain was just 0.1% we found out overnight.  Economists were expecting growth of about 0.4%.  Also, Chinese banks have begun restricting new loans, responding to a push by regulators to contain credit after a surge in lending in the first half of this month.  Overseas markets have been getting crushed overnight, and the news is also weighing on American stock futures this morning.  The US government reports 4^th quarter GDP this Friday.  Expectations are that the US economy grew by 4.5% in the fourth quarter, following the 2.2% growth in the third quarter … which ended several consecutive quarters of decline.

Domestically, we continue to get earnings reports this week, with the most notable news being Apple posting record profits thanks to sharp increases in iPhone sales globally.  After some initial struggles with the product, the iPhone has been a huge winner for Apple.  Insurance giant Travelers and chemical giant DuPont also posted solid earnings … which along with growing support for a reconfirmation of Big Ben Bernanke as Fed Chairman, should help keep the US stock blood bath to as minimum in the wake of the concerning overseas news and subsequent market reaction.

On the economic news front this morning, we get two biggies this morning.  The Case/Schiller Home Price Index at 9 AM, which is the leading authority on home values nationally here in America.  And consumer confidence at 10 AM, which is seen as a good indicator as to future consumer spending.  Consumer spending is by far the biggest component of the US economy.

News …

~ Bernanke Gains More Senate Support, Plans Additional Meetings

http://www.bloomberg.com/apps/news?pid=20601087&sid=abiX0LkkWzvA&pos=5

~ Obama To Seek Three Year Freeze on US Domestic Spending

http://www.cnbc.com/id/35068969

~ Fed Weighs Interest on Reserves as New Possible Benchmark Rate

http://www.bloomberg.com/apps/news?pid=20601087&sid=akYMsCezpjlk&pos=2

~ Digital Agency Rosetta to Bring Nearly 400 Jobs to New Downtown Cleveland Offices

http://www.cleveland.com/business/index.ssf/2010/01/digital_agency_rosetta_plans_t.html

~ Johnson & Johnson Results Top Wall Street Views

http://www.cnbc.com/id/35066607

~ Stock Futures Mixed Following Latest Round of Earnings

http://finance.yahoo.com/news/Stock-futures-mixed-following-apf-37805518.html?x=0&sec=topStories&pos=3&asset=&ccode=