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Techs and Couture In Fashion This Week

October 17, 2007

"Nobody goes there anymore; it's too crowded." -- Yogi Berra

Dear Fellow Options Trader,

One week ago I was in Paris with my lovely wife. She's always my lovely wife, but for taking me to the city of lights for fashion week and the Rugby World Cup, I thought a double tip of the hat was in order!

The reason I opened with that quote from the famous New York Yankees philosopher is because it's particularly true of Paris. Every hotel in town was jammed to the rafters as supermodels, celebrities, fashion industry insiders, rugby fans and players flocked to the city. One can hardly imagine a more-disparate group of human beings, from the super-thin, cutting-edge fashionistas like Posh Spice (Victoria Beckham), to the heavily muscled beefcake -- and I'm not talking about the rugers. I'm talking about Courtney Love and Demi Moore!

I did actually run into Ms. Love at the Ritz in the Place de Vendome, as she and her entourage hung just outside the revolving doors while the paparazzi flashed away. I thought she looked better than those emaciated shots running in People and OK magazines, and her hair was definitely well-coiffed.

But I actually felt a twinge of embarrassment for her, as the photographers shot hot-and-heavy for perhaps 20 to 30 seconds, and then they walked away to smoke and wait for fresh meat.

Her massive bodyguard and plethora of personal assistants and hangers-on were trying to usher her into the lobby afterward, but she hung right there, seemingly confused as to why she got such abbreviated coverage. Perhaps this was just the latest example of time decay, or a victim of Andy Warhol's spot-on "15 minutes of fame" describing celebrities' limited relevance like sand pouring through an hourglass.

Speaking of abbreviated coverage, my friends, the ladies in Paris are always among the best and most-provocatively dressed on the planet. But during fashion week, the competition ramps up a few notches! If you've ever met my beautiful wife, you know why I say I'm the luckiest man in the world, but even she was getting whiplash from all the colorful scenery.

As for Paris, the food, the drinks, the fashion are all still fantastic. Other than our usual watering holes like the Ritz, the Buddha Bar and Harry's Bar, we managed to squeeze in a few other spots and some of the finest food I've enjoyed since the last time I was in Paris. Off the charts folks, with bills to match! Drop me an e-mail if you're going over, and I'll send you some ideas.

Now as far as how the earnings season has progressed, I think we're seeing a mixed bag. I believe the main reason for this has been the late third-quarter results from the financial stocks like Goldman Sachs (GS), Lehman (LEH) and Bear Stearns (BSC). As those reports came in without the disaster projected by some, and when those reports were joined by the Federal Open Market Committee's generous 50-basis-point interest-rate cut on Sept. 18, the markets cheered with a 335-point Dow (DJI) gain that day.

Although the last two options expiration weeks brought Fed actions that made the markets cheer, the negative market action early this week was due in part to Fed Chairman Ben Bernanke's commentary on Monday that the housing market's woes were casting a shadow on the economy. Otherwise, this expiration week seems like it's "business as usual," as volatility is elevated and trading volume is reflecting the unwinding of positions that is typical of the third week of the month.

So, now that we've had some down days in the markets, the question has arisen about whether the market is spent, or just taking a breather. But with Intel (INTC), Yahoo! (YHOO) and the tech stocks coming in so hot, I would lean toward the market taking a breather, but time will tell. Any way you slice it, what goes down usually goes back up, and we'll ride the waves accordingly!


Jon "Doctor J" Najarian
Editor
ChangeWave Options Trader

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