Monday 02/9/09:
Super-Size My BailoutBy Frank Bocchino, OpenClose

If I did the math, it would work out that I frequent a McDonald's about every 10 years. But during bad economic times, low-cost fast food establishments do well with added patronage from cash-poor Americans. In these days of "super-sized" bailouts and stimulus packages, it's then apropos that McDonald's Corp. announced today that its same-store sales rose 7.1% in January with total sales rising 2.6%. But now, watching what's going on in the Senate regarding the stimulus bill, it leads me to pose one question: Do you want fries with that?

The $827 billion stimulus bill should pass in the Senate according to most reports despite all the grand standing on both sides of the aisle. The pink elephant in the room, however, is reconciling that bill with the House's $819 billion version of the bill that passed. Democrats and Republicans have had at each other in what I've dubbed "The Senatebowl." President Obama is shooting for mid-February to sign the bill.

As for mortgages, Obama has been quoted about earmarking $50-100 billion to help the foreclosure hemorrhaging. What that plan will include is still unannounced though. That is partly why many investors seem more in tune with the administration's plan to roll out the $700 billion financial bailout package. Already passed by Congress, Treasury Secretary Geithner had scheduled to announce the plan today, but the speech was postponed until tomorrow.

After a great Friday on Wall Street with the Dow rising more than 218 points, S&P 500 futures fell 5.6 points to 862.10 and Nasdaq 100 futures fell 6 points to 1,269.80. Dow industrial futures fell 39 points to 8215. U.S. stock futures fell after Treasury Secretary Geithner delayed the announcement of the administration’s financial-recovery plan until tomorrow.

The 10-year note dropped to 106-4/32 and its yield rose to 3.02% from 2.99% Friday. The 30-year bond fell 17/32 to 113-25/32 and its yield rose to 3.72% from 3.69% Friday. Federal Reserve officials still debate on whether or not to purchase long-term Treasuries. Instead the Fed has been concentrating on a program to purchase $200 billion in consumer and small-business loans and on a plan to buy $600 billion in home-finance debt some report.

The 3-month Libor rate ticked down a tad to 1.23% from 1.24% Friday. The overnight Libor rate was unchanged from Friday at 0.31%.

Oil prices rose 48 cents a barrel to $40.65. The dollar fell versus major currencies like the euro, the yen and the British pound.

So what will be on Tim Geithner be his Treasury menu Tuesday? Hopefully whatever it is, it will be low-fat, and conducive to a healthy economy. If it's not, I'll soon have to acquire a taste for 49-cent hamburger Wednesdays.

source: LionMTS: a division of OpenClose