On this day in 1850, a doctor at the "Mansion House" in Apalachicola, Florida amazed some guests whom he had invited by serving them drinks with ice. They were amazed not because it was a dry town…..it was not....the guests were amazed because this was Apalachicola, this was Florida, this was July…..yet here was ice. How deep could his icehouse go…..how many feet of sawdust had he needed to pile up to save these few cubes of ice?
Then the doctor (Dr. John Gorrie) further amazed his guests by bringing more ice…..he brought out whole brick-like blocks of it. The guests were stunned. How had he managed to save this much ice…..in Florida…..into July! Dr. Gorrie laughed and told them he had made the ice only yesterday. "Sure!” they said. "You made ice in July?" "Who the hell are you…..Mother Nature with a bad calendar watch?"
Dr. Gorrie must have laughed again and told them he had found a way of compressing water and then air in a way to chill things enough to produce ice. "Wow!" said the guests "Now you can open a bar!" Dr. Gorrie looked at them strangely….."Bar?…..This is a cure for malaria!"
Dr. Gorrie had noticed that malaria (a big problem in 1850) seemed to happen near wetlands (like Apalachicola) when it was warm. So he determined it must be the hot air that caused malaria. So, if you cooled the hot air down…..you should be able to stop malaria. That night Gorrie raised enough funds to install his ice-making, anti-malaria machine at the United States Marine Hospital. The main effect was that the rooms were cooler and the patients were cooler but the "yellow fever" continued. (It would be a half century later until Walter Reed would prove that the cause was mosquitoes who thrived in the hot weather…..not the weather itself.)
Although Dr. Gorrie was disappointed at what he saw as his "failure", bartenders and patrons did find a medicinal use for the ice. To celebrate…..call Clarence Birdseye and point out how one man's failure can be another man's fortune. Forgive the frosty response.
There was no sign of a chill in the U.S. stock market, Thursday. The Dow managed yet another record closing high. I think that makes something like the 24th record closing high of this year – yet the bulls are throwing no champagne parties. Skepticism lurks just below the surface.
A New Record In Three Acts – The market action was definitely tri-polar on Thursday as we saw three distinct moves in response to three distinct stimuli.
There was a rally on the opening primarily based on the hope that Janet might bring another box of candy to her Senate appearance.
By mid-morning, it was evident that Chair Yellen was offering nothing new and stocks drifted down to what would be the low trading point of the day.
The market's focus then shifted to the crude pits. Crude had been weak earlier, threatening to break below $45. In late morning it reversed sharply, spiking above $46.
That oil spike was the basis for a late morning rally in stocks which would last into late afternoon. I noted this evolving shift in a midday email to some friends:
Late morning bounce in stocks appears to be a response to crude punching above $46 after nearly falling below $45 in early morning.
Yellen puts little new on the table and the yield on ten year rises amid lots of talk of Draghi going hawkish. I strongly doubt that.
In the final 90 minutes, the crude based rally began to fade slightly. Just then it was announced that the Republicans had drafted a new version of a healthcare bill. The early comment was that this version was not necessarily dead on arrival as earlier versions had been.
While a healthcare bill is not necessarily bullish for the market, the signs of mild progress on this one helped put a bid under the market.
The feeling was that if they could even get "close" to a healthcare bill, it hinted the chance of a tax bill was greatly advanced. That assumption prompted a final hour bounce in stocks.
They came off the highs in the closing minutes in front of indications that there could be up to a billion dollars to sell on the bell. In the end it turned out to be only $300 million so the damage was slight.
Despite the Dow reaching a new record, the markets traded in a very narrow band, which is exemplified by advances and declines being relatively equal. Nevertheless, a record is a record.
A Vague Warning From A Friend Sparks A Trip Down Memory Lane – A friend called out of the blue, and said "I'm told you should be very careful around July 20th and 21st." "Careful of what?", I asked. "I don't know, exactly but this guy, who's very good with cycles, said that you need to be very careful around those two days", he replied.
I asked what kind of cycle the call was based on. My friend said this was based on the position of the planets. I asked if the friend's friend was an astrologer. "No", he replied, "this is based on a heliocentric chart." That's when the light went on – John H. Nelson.
Back in the 1950's John H. Nelson worked for RCA as a radio propagation analyst. That meant he had to determine on a given day whether the earth's atmosphere was conducive to send a signal direct from, say, New York to London. If the atmosphere was animated, what alternate route might work?
When he began, Nelson (and the world) thought the primary influences on the condition of the atmosphere were sunspots and solar flares which could change the ionization levels in the atmosphere.
Over the decades, Nelson determined that planetary positions, particularly at certain angles corresponded with changes in solar activity. (Think of it as a tidal-like influence.)
Soon Nelson's work was drawing the attention of Wall Streeters like Joe Granville and Arch Crawford. Part of the fascination came from the concept that increases in positive ionization is a negative mood alterer. (Google - Santa Ana Winds or Khamsin.)
Granville got further caught up in the theory when he noticed that these solar activity spikes often coincided with earthquakeson this planet and he began to predict earthquakes rather than the stock market.
At any rate, I'll send my friend back to try to get more data on the 21st. In the meanwhile, I'll try to get a copy of "The American Ephemeris and Nautical Almanac" to see if I can figure out what one of Nelson's angles may pop up.
Overnight And Overseas – In Asia, most markets saw minor gains except India who had a slight loss. In Europe, London was down on more Brexit chatter. Markets on the continent were mixed with very minor changes. In other assets, crude it up yet again and holding above $46. Gold is seeing a mild bounce and the euro is firming against the dollar. Yields are down a tick.
Consensus – We get the bank earnings, so financials will be center stage. We'll also see retail sales and inflation data. Traders think it may be a consolidation day going into expiration week. Stick with the drill – stay wary, alert and very, very mild. Have a wonderful weekend!
Answer - The phrase, "First in war, first in peace, and first in the hearts of his countrymen" was spoken at the funeral of George Washington.
Today's Question - These are Mary's math test scores: 98, 87, 82, 95, 93, 81, 100. What is the average?