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Week on Wall Street

Kai Ryssdal Aug 4, 2006


KAI RYSSDAL: Time to check the week on Wall Street with stockbroker and business analyst David Johnson down in Dallas, Texas. David, how are you?

DAVID JOHNSON: Oh, there you are. OK. I’ll be with you. . .

RYSSDAL: Oh, alright. I’ve got all the time in the world, man. Just go ahead.

JOHNSON: See, it’s vacation. We’re all taking off. We’ve got the employment numbers, we got the market just where we wanted. We’re all headed to the Hamptons.

RYSSDAL: Alright.

JOHNSON: Hey, you got one of those Jay Gatsby suits? One of those, you know, sort of pastel things?

RYSSDAL: No. It’s California, now. We don’t do that out here. So what does it mean you guys are all going on vacation? I mean it’s not like things stop.

JOHNSON: No, oh, they do. They really do. I think you’re going to see volume dry up. That’s not to say that, you know, something wild happens. Like, for example, Tuesday’s meeting with the Fed, that there won’t be some reaction. But by and large this is about it. This is the official end of the season, everybody takes off the last month. Everybody will be back the Tuesday or Wednesday after Labor Day. But at least we leave it in pretty good hands. I think, you know, I think the path is clear. After the numbers that came out today, the employment numbers we’ve been talking about. I think after that the Fed has absolutely no choice but to do the very honorable thing, and that is take a pass on hiking interest rates.

RYSSDAL: I don’t believe you.

JOHNSON: Well, I’m telling you what, if they don’t, if they don’t. . .


JOHNSON: The Hamptons are gonna empty, I’m gonna lead a charge, we’re gonna head to Washington and we’re gonna converge on the Fed building like the French did on the Bastille. And 20, 30 years from now there are going be people giving tours of Washington, D.C., and they’re gonna look over and they’re going to say, once many years ago, back at the turn of the century, that’s where the Federal Reserve used to meet. They were headed by the guy . . . whoever the guy was that followed Greenspan.

RYSSDAL: Yeah, him. Whatever his name was.

JOHNSON: Then they disbanded.

RYSSDAL: Look, I got bad news for you, though.

JOHNSON: What’s that?

RYSSDAL: I think you’re full of hooey.

JOHNSON: Hey, come on now. Wait a minute. I’ve made a living doing this the last. . .

RYSSDAL: No, I really do. I know you do, and far be it for me. But here’s the thing: how many times has everybody on the planet said, ‘oh yeah, they’re definitely done and then bada bing, bada bang, they come back and they slap us again.’

JOHNSON: Oh come on. Look, they got to be looking for a noble exit. This economy is slowing. The job gains are slowing down. You look at what’s going on in the housing market. We see it in retail. Now what do you want? You want to wait ’til we just stop, we absolutely stand on the brakes? This thing stands still? I don’t think so. I really don’t think so. And I tell you, this futures market, which is really a pretty good predictor says there’s now a 15 percent chance that they’re going to hike interest rates. And let me . . . hand up just a minute. . .

RYSSDAL: Alright.

JOHNSON: I’m going to bring up the graph. This is the 10-year bond. I’m bringing it up, and it looks like a camel. Not a Dromedary, you know, but one of those. . .

RYSSDAL: One of those double, triple-hump guys?

JOHNSON: Yeah. Well, we’ve completed the second hump and we’re heading back down. I don’t know if we’re headed for the next or the nether region. . .

RYSSDAL: Well, what you’re saying then is the markets think we’re done, right?

JOHNSON: The markets think we’re done, I think we’re done. This has got to be plenty. Now we just sit back and enjoy a nice quiet three or four weeks and we’ll all get back to work Labor Day.

RYSSDAL: You’re going to be around on Tuesday cause we’re going to call you. Cause I am here to tell you, we’re going to call you Tuesday afternoon and we’re going to put you back on the radio, my friend.

JOHNSON: Everybody loves an I told you so, Kai.

RYSSDAL: And here we are. David Johnson down in Dallas, Texas. Thank you, David.

JOHNSON: Alright. Have a good weekend.

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