Remember Obama’s Gift to Iran? Iran Admits to “Stealing” All of the Secrets of US Drone

Obama chose not to destroy the drone after it crashed. This is the result.

An Iranian military commander claimed Monday that the country has stolen all the secrets held by a high-tech American surveillance drone that crashed in Iran last year, according to Iranian news reports.

“All the intelligence in this drone has been completely decoded and extracted and we know each and every step it has taken,” said Brig. Gen. Amir Ali Hajizadeh, Commander of the Aerospace Division for the elite Islamic Revolutionary Guard, according to an English-language report by Iran’s semi-official Fars News Agency.

Another Iranian outlet, Press TV, reported that Hajizadeh said that data gleaned from the drone showed that it was not spying on the Iranian nuclear program – a story Hajizadeh said the Americans had spread “as an excuse for hostile practices.”

The RQ-170 Sentinel drone, a classified unmanned surveillance craft produced by defense contracting giant Lockheed Martin, was on a CIA mission when it mysteriously crashed in Iranian territory last December, according to U.S. officials at the time. Days after the crash, Press TV broadcast video of what appeared to be the drone propped up but in good condition. Iranian officials said then they were going to set about analyzing the advanced aircraft.

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Home building stocks have had a good run lately. While sales are down profits are up in part to wide spreads in lending. Uncertainty looms with upcoming Dodd Frank regulations and home building  companies say risk on profits are present based on many factors beyond the sectors control.

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“Overall, Wall Street’s strategists are bullish on stocks for 2013 for various reasons.

One reason worth taking a second look at is expanding corporate profit margins, which are already at historic highs.

A slew of experts like GMO’s Jeremy Grantham, SocGen’s Albert Edwards, LPL Financial’s Jeff Kleintop, and John Hussman think these margins are unsustainable.

But the equity analysts and the companies they cover disagree.

Here’s a chart from Goldman’s David Kostin showing the analysts’ forecast for S&P 500 margins next year:”

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“Each December we publish a list of investment themes that we feel are critical to the coming year.

We continue to believe that US equities are in the midst of a major bull market that could  ultimately rival 1982’s bull market.

It is hard to be bearish when one considers the following:

Sentiment — Continued outflows from US equity funds; Wall Street Strategists’ recommending the most bearish equity asset allocation in nearly 30 years.

Valuation – According to our models, the US equity market is presently  discounting 5%-6% inflation for the next 12 months, which seems very extreme to  us.

Liquidity – The Fed has told investors that they will continue to provide liquidity and will be slow or late to tighten.

With that bullish view toward equities, here are our “13 for ’13.”

1) US stocks outperform Emerging Markets, yet again.

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“The second winner of the $587.5 million Powerball jackpot was identified Monday as Matthew Good, a married man in his 30s who moved to an affluent Phoenix suburb last year from Pennsylvania.

Good had decided to remain anonymous, but lottery winners in Arizona are a matter of public record. The Associated Press filed a public records request to learn his name.

Good took the one-time payout of $192 million from the Nov. 28 drawing, telling lottery officials the looming fiscal cliff was the reason he claimed the winnings now and not in the next calendar year. He had 180 days to claim the jackpot.”

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BoA out with a report on gold. You get the gist of it from the title….

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“Apple Inc. (NASDAQ: AAPL) is invincible right? Not lately. We started warning you about the coming death cross on the chart, where the 50-day moving average dips under the 200-day moving average, a few days before CNBC started talking about. That death cross is now here, for all practical purposes, and one analyst has taken $100 off of the Apple stock price target for 2013.

The research team at Jefferies did maintain a Buy rating, but it lowered its price target objective to $800 from $900. Jefferies is expecting some margin pressure as Asian suppliers cut back on the cost concessions that Apple has been the beneficiary of for so long. The firm also sees slowing growth in the fiscal 2014 period, even with a new iPhone launch most likely next summer followed by a new iPad launch next fall. A lower-priced iPhone also may cut into margins…”

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“Internet analyst Mary Meeker released new data showing a changing of the tech guard and a Darwinian survival of the fittest — Microsoft is being eclipsed by Apple, while Google’s Android system is showing even more remarkable worldwide growth.

Meeker, whose annual “State of the Internet” report is widely followed in Silicon Valley and beyond, validated the notion that smartphones are a transformative phenomenon. But the disruption they represent to the communications chain may be just beginning.

Her data show a dramatic shift away from Windows-powered Intel machines (Wintel) in less than a decade.”

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“Seeking to take advantage of the rebound in the housing market, some big-time investment firms are snapping up single-family homes.

The private equity titan Blackstone Group, for example, has shelled out more than $1 billion to buy 6,500 single-family homes so far this year, The Wall Street Journal reports.

Another private equity firm, the Colony Capital Group, led by Los Angeles billionaire Thomas Barrack, has acquired 4,000 homes….”

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“According to IDC’s latest report on smart device shipments, we’re in for a record-breaking holiday season. The analyst firm is expecting device shipments to grow 19.2% over third quarter levels, and 26.5% year-over-year to reach 362 million shipments in the fourth quarter of 2012 with a total market value of $169.2 billion dollars.  In Q3, worldwide smart device shipments grew 17.1% year-over-year, also setting a record, with 303.6 million shipments valued at $140.4 billion dollars….”

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“Regular readers are aware that one of our favorite data series when it comes to demonstrating the quality aspect of the American “recovery” (the quantity is sufficiently taken care of with part-time workers filling in positions without benefits and job security in the New Normal) is that showing the annual average hourly earnings growth in nominal terms, which in November posted the tiniest bounce from its all time low print of 1.2%, rising to 1.3%…”

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“After making a big deal of publicly supporting the Affordable Care Act, Walmart—the nation’s largest private sector employer—is joining the ranks of companies seeking to avoid their obligation to provide employees with health insurance as required by Obamacare.

It was not all that many years ago that Walmart announced, in response to harsh criticism over the low pay provided to Walmart ‘associates’, that the company would provide a healthcare benefit to its part-time, low earning employees. The uncharacteristically generous nod to worker needs was short lived as the company partially pulled back on the commitment in 2011, citing premium rate increases that Walmart deemed beyond their capacity to pay…”

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“U.S. consumer spending, a rare pillar of economic strength in recent months, is showing signs of weakening.

American consumers helped carry the economy through a spring slowdown and appeared to power a summer resurgence in growth. But in recent weeks government data have shown spending was slower over the summer than previously believed, and it has started off the final three months of the year on an even weaker footing.

Now a range of factors, from high unemployment to the prospect of increased taxes due to the approaching “fiscal cliff,” are threatening to sap consumers’ spending power at a time when other sectors of the economy likely are too weak to pick up the slack.

President Barack Obama and House Speaker John Boehner met for one-on-one talks Sunday at the White House in a bid to hasten a resolution of the budget impasse, and the president’s aides have left his schedule largely open this week so he has the flexibility to hold more meetings and events. Neither side would discuss the content of Sunday’s conversation…..”

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NYSE

ANF, AAP, APA, BBY, CME, EBAY, FCX, ISLE, MET, NBL, OMC, PLXS, QRE, SKS, TRIP, CYBX, NYX,

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In Play ,

On the Wires 

“Europe is taking it on the chin today, the culprit seems pretty clearly to be Silvio Berlusconi and Italy, where market sare getting crushed, thanks to his desire to return to politics, and Mario Monti’s resignation.

It’s debatable how big of a deal this is, really. Berlusconi has no chance of winning (per polls and pundits) and Monti was going to resign anyway, since elections are in the spring).

In his Sunday Start note, Morgan Stanley’s Joachim Fels has a different story in Europe that’s bringing him down. It doesn’t get as much attention as the flashy headlines, but it has to do with Eurozone leaders backtracking on the bigger efforts towards integration and common regulatory frameworks.

Says Fels:

What really drags me down, though, is the European political saga….”

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“Honeywell International Inc. said it’s buyingIntermec Inc., an Everett maker of radio frequency identification (RFID) products, for $600 million.

New Jersey-based Honeywell will pay $10 per share for Intermec (NYSE: IN). Shares in Intermec were up about 23 percent, or up $1.83 to $9.79 in pre-market trading.

In May, after reporting a first-quarter adjusted loss of $12.7 million, or a loss of 21 cents per share, Patrick Byrne, president, CEO and board member was replaced by an interim CEO, Allen Lauer. Intermec said it is suspending its search to find a permanent CEO. In June, the company slashed 7 percent of its workforce, or 170 jobs…”

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