Oh The Power Of A Bailout

Are we seriously pinning our hopes on another financial bailout; seriously? Last time I checked it wasn’t up to one person to pass legislation but I’ll check on that and get back with you. Based on that hope though, the major indices rallied off of the lows. Now, those lows were in place because of what I would consider valid reasons (facts and not hope). Those of you with good memories should know how important it is for Bank of America ($BAC) to stay afloat. That’s the same crew that bought Countrywide and we will know how well that worked out on the 20th of this month when we get Q4 earnings.

The Labor Department said Thursday that the producer price index declined 1.9%, driven by a 9.3% drop in energy prices, and a 1.5% decline for foods. The December core PPI, which excludes food and energy costs, rose 0.2%, compared with a 0.1% gain in November. The street was looking for the PPI to drop 2.2% with the core being flat.

For those of you that trade options (and even if you don’t) you should know that tomorrow is options expiration. Typically the week of options expiration the markets can move in unusual ways, especially on an intraday basis. At any rate, if you have open option positions that expire in January, that’s tomorrow. The ideal time to roll your options is the first part of options expiration week. Come Monday (which is also a market holiday) the February options will be the front month.

Tomorrow we get the consumer price index, TIC long-term purchases, capacity utilization rate, industrial production, preliminary UM consumer sentiment and inflation expectation and some Fed speak from Lacker. On the earnings front, C, JCI, PPG and FHN are reporting tomorrow.