2004 Christmas Miracle Seen "From The East"

(NORTH POLE-SEATTLE) 12/20/04 - In any normal year, Christmas retail sales are seen as critically important the US economy. But 2004 is no normal year; rather, it is a ''miracle'' year where no one need be burdened with payment, even for such mundane trifles as government expenditures and wars.

With employment growth weak, and inflation the highest in years, retail sales in 2004--very much like the war - need not be burdened by mortal payment needs. Rather, this Christmas, an "endless Santa's bag" has opened in earnest, amidst a great cascade of easy finance terms, spewing forth every manner of " household wealth" in the form of Christmas cards (of credit). Yes, all these gifts come... riding a sleigh not from a single house at the North Pole--but rather, from everyone's home! That is, in the form of "sweet gingerbread home loans" --based on double-digit real estate price rises, set by mortgage elves and dancing fruitcakes.

"On Dasher, On Dancer... On Fannie Mae!"

Indeed, this "savior of 2004" was seen from afar, as a sign in the heavens, even before Christmas--and as "chance" would have it, well back before even November 2nd. Yep, there's no doubt this year, the great "wise men from the east" (otherwise known as incumbent politicians, the Federal Reserve, and Asian central banks) really set up for a celebration like no other year.

So in this time of plenty, it is not surprising to see signs of the Christmas retail god everywhere. The S&P Retail Stock Index is up over 80 percent since early 2003--over the same period where job growth was the weakest of any recovery on record, even while home price growth has "raptured to the heavens."

Not unexpectedly, the Nasdaq Stock market has found its new place among angels. No longer a sign of a vibrant job-producing economy-- the index has narrowed. Even in a climate where a weak dollar might drive up foreign sales, high tech and biotech has met up with Scrooge. Instead, the Nasdaq is driven increasingly by retail names such as Starbucks, Ebay, and of late, Kmart Holding company - seen valuable for "real estate reasons"... thus bringing the Christmas miracle back - round Santa's jolly tummy, in truly a great and circular fashion.

ENDS

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