COMMENTARY | COLUMNISTS | GEORGE CHAMBERLIN

George Chamberlin's Money in the Morning

The financial markets yesterday suffered from the dialogue surrounding the "F.C." The markets reacted every time a politician in Washington made a comment about the budget standoff. At the close the Dow Industrials were down 75 points, although the index had been lower through most of the session. Just before the close, the Dow was down triple digits when it was announced Speaker Boehner was at the White House to talk with the administration about tax cuts and rising revenues. That immediately sent stocks higher, only to move back down when it was confirmed there was no progress in the discussions. Won't it be nice when we can go back to the basics of investing?

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There was no big surprise in today's report on the cost of living. The Labor Department reported the consumer price index fell 0.3 percent in November as energy prices -- especially gasoline prices -- fell. In October the CPI has gone up because prices at the pump had spiked higher, so the 4.1 percent drop in energy costs last month more than offset the earlier increase. Over the past 12 months the cost of living has gone up a tepid 1.8 percent. Hidden in today’s report was a component showing inflation-adjusted hourly wages were up 0.5 percent, the biggest increase in five years.

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I've spent a big chunk of the last two days at various real estate conferences and it is clear the mood going into 2013 varies from cautiously optimistic to very optimistic. Report after report shows positive news about the housing market, including the latest from RealtyTrac showing the number of homes entering the foreclosure process fell in November to the lowest level since December 2006, just before the market collapsed. Foreclosure starts fell 28 percent compared to the same month a year ago.

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The Citi Economic Pulse finds Californians are in a pretty good mood these days as far as their finances are concerned. The report shows 66 percent of the people in the Golden State are optimistic about their own financial situation with a record 21 percent saying they are very optimistic. At the same time, 56 percent of the people expect the state economy to improve in 2013.

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The bankruptcy court overseeing the demise of Hostess Brands has accepted preliminary bids from companies wishing either to buy the assets of the company entirely or individual brands like Twinkies or Wonder Bread. It is reported bidders include Wal-Mart, Krogers (parent company for Ralphs grocery stores), and Campbell Soup. The court will review the bids and announce the buyers in early 2013.

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The college bowl game season is under way. Be sure to set your DVRs tomorrow afternoon for the Famous Idaho Potato Bowl on ESPN featuring Toledo against Utah State. Next Friday is the Beef 'O' Brady's Bowl in St. Petersburg pitting the University of Central Florida against Ball State. I love this stuff.

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If you do want to watch a great sporting event this weekend, catch the NCAA Division One women's volleyball championship game between Texas and Oregon. The game will be played in Louisville and carried on ESPN at 4 p.m. The power, speed and grace of these athletes is incredible. The Ducks are the surprise team in the finals after upsetting perennial champion, Penn State, last night.

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