Response to the normal economic news was muffled this week in the equities markets, where activity hinged on government moves to check corporate fraud.
The Senate, for example, voted unanimously at midweek to adopt new criminal penalties that include prison terms for securities fraud and federal protection to company whistleblowers. The vote followed calls by President Bush for more aggressive policing of America's board rooms. The upshot is stock prices are falling as investor confidence erodes, damaged by suspicions of the accuracy of once-trusted quarterly and annual reports.
In the commodity markets, meanwhile, the search for price transparency continues based on more tangible elements.
The government's supply/demand report released on Thursday projected a further decline in ending soy stocks. And, that same report estimates all wheat production this year will total less than 1.75 billion bushels – the low end of trade expectations. Even though demand for wheat is lethargic, the draw down of supplies is pushing prices higher, especially on widespread reports from harvest crews of anemic yields.