Sold AVY/GE Upgrade/NYX

1. General Electric (owned): GE has not received much love lately. Goldman Sachs took pity on it this morning, upgrading the stock to buy from neutral and raising its price target to $16 from $13. Based on reports, the upgrade was due to comments by Barney Frank that Congressional regulatory "reforms" might not require the separation of GE Capital. The comments made by Frank yesterday are summarized in a Bloomberg article.

2. NYSE Euronext (owned Buys of JWF KSA DIS and NYX): Excluding some charges, NYX reported a Non-GAAP number of 51 cents on a 9.5% increase in revenue. NYSE Euronext's fixed costs decreased by 6%. I am not impressed with these results. The 214 million in operating income was down from 282 million in the second quarter of 2008. The non-GAAP earnings did beat the forecast by 6 cents however.

3. Sold Avery Denison (AVY) at 29.97 (see disclaimer): Avery Dennison is one of the stocks bought in early March 2009 with the following caveat. I would stay with the company for as long as the company stayed with me, i.e, for as long as there was no cut in the dividend. AVY AVY cut its quarterly dividend from 41 cents to 20 cents this morning and I promptly sold my shares. AVY reported earnings of 38 cents per share, down from 93 cents a year ago.

There is an exception to this automatic sale in place since March. If the company cuts the dividend and announces a 5% or greater voluntary pay cut for management, a shared sacrifice, then I will forgive and forget. But my tolerance for dividend cuts, where management continues their own pay as if the good times continued to roll, is at an end.

4. More on the Fat Tax: Headknocker noted that under the Body Mass Index (BMI) chart, no doubt prepared by a bunch of commie liberals, he would owe his fair share of a Tax on excess body fat. The beauty of the Fat Tax is that revenues generated by it will grow at a faster rate than inflation, and even faster than the historic rise in medical costs. Based on his personal observations, Headknocker is positive that his BMI has grown at a faster pace than inflation since at least 1990, and can not imagine how that could be true, given the steady diet in cheeseburgers, fries and sugary soda drinks and his constant thinking about exercise.

There was a debate this morning among staff here at HQ about how Charlie Rangel would avoid paying his fair share. While some say that television makes people look more rotund than the reality, we suspect that may not be true for Charlie. Then RB chimed in, with the observation that Charlie would weigh himself and then pronounce that at a mere 125 pounds, well within the boundaries of that communist BMI index, he owed no Fat Tax.

Health care spending has increased at a faster rate the GDP since the 1960s. In 2007, the Kaiser foundation estimated that health care spending had increased 2.4 percentage points faster than GDP since the 1970s and would equal almost $13,000 per resident by 2016.