March 12, 2010 Market Commentary By Art Cashin $UBS

Cashin’s Comments
AN ENCORE PRESENTATION
On this day in 1888, America was moving through what looked like just another day. People had begun talking about the up coming Presidential election. There was a lot of talk about trading partners and religion. The race for the White House looked like it could get ugly. And the stock market was confused by the whole thing and rather nervous. But that was years ago.

Anyway, spring was in the air around New York City and the election was months off. But, on this day, the temperature began to drop sharply on the East Coast where most folks lived at the time. And, in a matter of hours, the winds whipped up and winter weather was back. The cold snap collided with a coastal rain storm. It started as flurries. Then in growing, biting winds the snow began to fall. The meteorologic oddity became a blizzard. Over 40 inches of snow swirled into 9 foot drifts as phone lines fell. More than 400 people died in the streets. The city ground to a halt. All contact beyond five miles was lost. But it was the age of American ingenuity. So police, hospitals (and brokers) sent messages by under ocean cable to London. There they were retransmitted by underwater cable to Boston. Thus, help was sent to a New York - - paralyzed by The Blizzard of `88.
There was no blizzard on Wall Street Thursday. There wasn’t even any snow. But there were lots of drifts.

Currency Moves Help A Late Day Levitation – After a post-opening selloff, stocks spent much of the day snaking around the unchanged line. Some sources claim the Dow crossed the unchanged line almost 50 times yesterday.

In late afternoon, stocks, oil and gold all began to tick higher in light trading. The catalyst, obviously, for that troika move was currency. In stocks the move took the S&P tantalizingly close to its January highs.

Stocks got a further push up when the market on close imbalances were published at 3:45. The imbalances where heavily skewed to the buy side causing stocks to tick higher in response.

Stocks closed at the high of the day. That put the S&P at 1150.24 just a hair’s breadth away from the January high of 150.45. Unfortunately, the rally came with rather skimpy volume.

This Time It’s Different? Well Maybe It Is – A friend passed along a paper from the Atlanta Fed comparing the current contraction in consumer credit with that in prior recessions. Here’s how the paper begins:

Total consumer credit outstanding expanded by $5 billion in January after contracting 15 of the previous 17 months. Consumer credit outstanding includes revolving and nonrevolving credit. Revolving credit is mostly credit card debt, and nonrevolving credit includes loans for items such as
vacations, autos, and boats. Even with the slight increase in January, total consumer credit (after adjusting for inflation) has contracted nearly 6 percent since the recession began in December 2007. This number might


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