Jan 12-16: Je suis Charlie

DJIA 17640 // S&P 2028 // NASDAQ 4664 // 10-YR TRE 1.909% //
EURO $1.1835 // OIL $46.07 // GOLD 1238

World leaders gathered in Paris in the wake of coordinated terrorist attacks last week. The event saw Benjamin Netanyahu and Mahmoud Abbas lock arms in solidarity against the violence.

$46.07

Closing price of the front-month futures contract for West Texas Intermediate crude oil, now trading at a level not seen since April 2009. WTI crude was trading at $107.26 this past June.

Paris March in Solidarity Against Terror Attacks Was Largest in French History, TIME

Heads of state from across the world joined with around 1 million marchers in the streets of Paris on Sunday in the largest procession through the city since the end of World War II. The march followed a 2.5 mile route through the city; marchers were watched by sharpshooters on buildings overhead. Notably absent from the group was US President Obama. Following criticism, the Obama administration apologized for their "mistake" in not attending.

Oil Settles Below $47 as Goldman Cuts Outlook, MarketWatch

Monday's drop in the price of oil follows cuts from both Goldman Sachs and SocGen on their projections for oil prices through 2016. Goldman has targets of $41, $39, and $65 for oil in 3, 6, and 12 months, respectively. Saudi prince al-Waleed bin Talal was quoted as saying we will "never again" see oil above $100 a barrel.

Companies Break a Sweat as Dollar Catches Fire, CNBC

As the US Dollar spikes to its highest levels in 12 years, pundits worry about negative effects on US trade and manufacturing due to the relatively-expensive nature of US exports. Any negative effects would counteract benefits from the dollar's strength including increased purchasing power of American companies abroad, and the check a strong dollar puts on inflation. McDonalds, General Mills, Nike, and Costco have all publicly stated that currency effects will crimp earnings in 2015.

ECB's Bond-Buying Plans Face Doubt, WSJ

As the dollar gains, the euro continues to slide as the ECB debates purchasing sovereign debt of struggling participant states. Concern among stronger economies including Germany warn of the moral hazard of "bailing out" eurozone governments that have made imprudent decisions. Asset purchases by central banks, referred to as "quantitative easing" or "QE," are designed--among other things--to drive down borrowing costs, encouraging households and businesses to invest and spend.

Vocabulary:

Charlie Hebdo http://en.wikipedia.org/wiki/Charlie_Hebdo

ECB http://www.investopedia.com/terms/e/europeancentralbank.asp

QE http://www.investopedia.com/terms/q/quantitative-easing.asp

WTI http://www.investopedia.com/terms/w/wti.asp

Brent http://www.investopedia.com/terms/n/northseabrentcrude.asp

Calendar, Jan 12-16 (Nasdaq Economic Calendar):

• Mon 12th: earnings from AA
• Tue 13th: NFIB Small Business Optimism Index; KBH
• Wed 14th: Retail Sales, Import and Export Prices; JPM, WFC 
• Thu 15th: Jobless Claims, PPI, Empire Manufacturing Index; C, INTC, SLB
• Fri 16th: CPI, Industrial Production, Consumer Sentiment; GS

Predictions, Jan 12-16

• Dollar will continue strengthening dollar index continues to rise
• Crude prices will continue to drop
• Alcoa (AA) will beat earnings on Jan 12

Participants: J. O'Brien, J. Ayat, S. Ballantyne, K. Meenan