Did you feel a little twinge last week? Sure you did. Think about it. It probably felt like a noose tightening around your neck, or a fire burning the wallet in your back pocket. "The Greek" believes we finally crossed the critical oil price threshold last week, and nobody noticed. We are of course talking about the price point where energy really starts to impact economic demand.

It developed sort of like how a caged dog, one within an invisible electronic fence, feels a shock as he approaches or crosses it. Americans likely felt a similar threshold surpassed last week. It certainly was a hard one to cross, after all, it took months of price rise past the points most economists thought would do it. It seems we finally reached the critical point for oil and gasoline pricing, where individual consumers will begin to seriously consider conservation and alternative energy resources. More on that in a minute...

Last Week

Stocks moved lower throughout last week, as rising oil prices raised broader economic concern. The Dow Jones Industrials moved 3.9% lower, while the S&P 500 fell 3.5% and the Nasdaq Composite slipped 3.3%. The decline was broad reaching, as seen by the similar moves across the diverse indices.

The blame for the tough week clearly fell upon oil. Crude oil futures for July delivery started the week just under $127, and ended it at $130.51, touching a high of $135 on Thursday. Meanwhile, just ahead of the big Memorial Day weekend, one that is well known for motor vehicle traffic, gasoline prices skyrocketed as well.

June futures for gasoline started last Monday morning at $3.23 a gallon on the Mercantile Exchange, and closed Friday at $3.32. The good news is that oil and gasoline prices backed off Thursday’s highs to close the week a step lower. However, stocks found no solace in that news, since the slide likely came on profit-taking, not fundamental reasoning. However, the highs probably likewise benefited from trading momentum, so the slip was good news just the same.

Wednesday helped to fuel the most recent energy spike, as the Energy Information Administration reported a weekly draw of 5.4 million barrels of oil from storage. Meanwhile, the media had much to feed the frightened with as well. Oil executives were grilled on Capitol Hill last week by a Senate panel. The Senators highlighted the contrast of oil company profits and excessive executive compensation with the inflation burdened American public and an economy that teeters on recession. At the same time, Congress passed an insanely dangerous measure that might lead to legal suit against OPEC. Seems Congress never heard the saying about not biting the hand that feeds you.

The Good News

However, as the stock market worried about the impact of high gas and other prices, it likely also foreshadowed a price-induced conservation of energy that should decrease demand for it. In other words, a threshold looks to have been passed, where people will actually now seriously consider travel distance and other fuel expenditures in their plans. This seems to indicate that petroleum might trade in a range in the near term. You’ll want to check into the Wall Street Greek website this week, as we are preparing an in-depth petroleum market report.

The Week Ahead

The abbreviated trading week still holds a powerful concentration of economic data on the schedule.

Tuesday

Consumer Confidence for the month of May was reported Tuesday morning, falling to 57.2, versus consensus expectations for a reading of 60.0. That compares with a reading of 62.3 in April.

Also reported on Tuesday, New Home Sales for April follow Friday’s Existing Home Sales data, which while down, still beat expectations. We expected that seasonal impact and dramatically low recent levels to compare against might offer a positive surprise in this report. Sales ran at an annual pace of 522K in March, missing that month’s consensus expectation by a mile. When reported this morning, April sales ran at a pace of 526K, up slightly.

The S&P Case Shiller Index built upon the weak sales data, showing that home prices continued to moderate in March and of course in the first quarter (-14.1% from last year's period).

Tuesday kicks off the shortened week's earnings schedule, including reports from Borders Group (NYSE: BGP), Donaldson (NYSE: DCI), Jamba Juice (Nasdaq: JMBA), Vodafone Group PLC (NYSE: VOD), Bank of Montreal (NYSE: BMO), Bank of Nova Scotia (NYSE: BNS), Cogent (Nasdaq: COGT), Modine Manufacturing (NYSE: MOD), On Track Innovations (Nasdaq: OTIV), Shanda Interactive (Nasdaq: SNDA), SourceForge (Nasdaq: LNUX), StealthGas (Nasdaq: GASS), Versant (Nasdaq: VSNT) and WuXi PharmaTech (NYSE: WX).

Wednesday

Wednesday’s Durable Goods report and Thursday’s Corporate Profits seem poised to stab economic hopes in the back. Most of the preceding data on the subject of corporate profits has indicated that they've been sickly this past quarter. Let's not mince words.

Regarding durables, Bloomberg's consensus expects a monthly decrease of 1.1% for April orders. That would compare with a 0.3% decline in March. We like to remind readers that just-in-time production-to-delivery processes, supportive technology and fluid distribution channels have helped companies to manage inventories at an increasingly efficient rate. So, inventory levels might fluctuate in a volatile fashion from month to month as a result. Four consecutive months of decline, however, clearly reflect the softening domestic demand, capacity consolidation and economic weakness we've seen this year.

Minneapolis Fed-Man Gary Stern and Dallas Fed President Richard Fisher are both scheduled to address audiences on Wednesday. Barron's correctly reports that Fisher's comments might offer some interesting perspective, as he has dissented against rate cuts three times in recent history. What he has to say about inflation might prove enlightening, if he speaks openly.

The weekly same store sales data reported by the International Council of Shopping Centers - UBS, gets pushed back a day this week due to the holiday. So, you can look for that very important and under followed metric on Wednesday morning this week. In case you missed it, last week's report showed a sales spike of 1.6% year-over-year. The Mortgage Bankers' Association reports on mortgage activity Wednesday morning as usual, however, we find little insight from the report still. Later, it will be interesting to follow how mortgage rates might rise with inflation, thus curtailing housing market recovery.

The EIA usually reports Petroleum Status on Wednesday, but this report is often pushed back a day during shortened weeks, and this week will be no exception. Look for oil market news on Thursday.

Wednesday's earnings schedule includes American Eagle Outfitters (NYSE: AEO), Chico's FAS (NYSE: CHS), Coldwater Creek (Nasdaq: CWTR), Dollar Tree Stores (Nasdaq: DLTR), Dress Barn (Nasdaq: DBRN), Jo-Ann Stores (NYSE: JAS), Men's Wearhouse (NYSE: MW), National Bank of Greece (NYSE: NBG), Polo Ralph Lauren (NYSE: RL), AFC Enterprises (Nasdaq: AFCE), Apollo Investment (Nasdaq: AINV), Applied Signal (Nasdaq: APSG), CBRL Group (Nasdaq: CBRL), China Nepstar Chain Drugstore (NYSE: NPD), Daktronics (Nasdaq: DAKT), Finlay Enterprises (Nasdaq: FNLY), Jinpan Int'l (AMEX: JST), RBC Bearings (Nasdaq: ROLL), Shamir Optical (Nasdaq: SHMR), Synovis Life (Nasdaq: SYNO), TIVO Inc. (Nasdaq: TIVO), Toronto Dominion Bank (NYSE: TD) and more.

Thursday

The top story on CNBC Thursday morning should be the first revision of Q1 GDP. We could see the number reported in contraction territory or close to it, from its first reporting at +0.6%. This report looks to be highly influential to market direction and even medium term market movement, as it addresses one of two key market concerns very directly. Those two key concerns are of course economic growth and inflation. Economists well-informed by other since revised and late reported economic data are actually forecasting an upward revision for GDP, to 1.0% growth for Q1.

As indicated earlier, Corporate Profits will also be reported on Thursday morning, and most data have offered indication of a dramatic decline in corporate earnings. Profits are finding pressure from both directions. The soft economic environment is impacting the top line and rising costs are squeezing margins at the same time. For this reason, economic recovery seems limited in opportunity, and stocks upward potential likewise capped.

Weekly jobless claims are due on schedule, and Bloomberg's consensus expects 370K or so new benefits filers. Last week's report showed 365K. The Help-Wanted Index is also due, but its significance has been reduced by the advent of online job search tools. We suspect there will be a second wave of job market decline in the months ahead as pressure mounts on corporate executives to preserve shareholder value.

The Energy Information Administration will report on Petroleum Status on Thursday this week. The data will of course prove an important news bit, and especially so after a draw from inventory of 5.4 million barrels last week. Natural gas will be reported upon on its regular schedule, meaning the two reports reach market simultaneously this week, offering a powerful concentration of energy data all at once. At the start of the week, energy prices were already backing off recent highs, as it becomes plainly apparent that the demand sensitive threshold has been reached.

Ben Bernanke will perhaps yodel his speech on liquidity in Switzerland on Thursday, while Tim Geithner addresses a group in New York. With food shortage and inflation in focus, the OECD and the United Nation's Food and Agriculture Organization will issue their 2008 outlook on agriculture.

Thursday's earnings schedule includes Costco (Nasdaq: COST), Dell (Nasdaq: DELL), H. J. Heinz (NYSE: HNZ), Hellenic Telecommunications (NYSE: OTE), J. Crew Group (NYSE: JCG), Joy Global (Nasdaq: JOYG), Sears Holdings (Nasdaq: SHLD), Ansoft (Nasdaq: ANST), Big Lots (NYSE: BIG), Canadian Imperial Bank (NYSE: CM), Caraco Pharmaceutical (AMEX: CPD), dELiA's (Nasdaq: DLIA), DSW Inc. (NYSE: DSW), DynCorp (NYSE: DCP), eLong (Nasdaq: LONG), Esterline Technologies (NYSE: ESL), Fred's (Nasdaq: FRED), Genesco (NYSE: GCO), Golar LNG (Nasdaq: GLNG), Gottschalks (NYSE: GOT), HEICO Corp. (NYSE: HEI), Iteris (AMEX: ITI), Man Group plc (Nasdaq: MNGPF.PK), Marvell Technology (Nasdaq: MRVL), Monro Muffler (Nasdaq: MNRO), Movado (NYSE: MOV), Netezza (NYSE: NZ), Omnivision (Nasdaq: OVTI), QAD Inc. (Nasdaq: QADI), Royal Bank of Canada (NYSE: RY), SeaChange Int'l (Nasdaq: SEAC), Shoe Carnival (Nasdaq: SCVL), Sigma Designs (Nasdaq: SIGM), Sycamore Networks (Nasdaq: SCMR), The Descartes Systems (Nasdaq: DSGX), Wind River Systems (Nasdaq: WIND) and XETA Technologies (Nasdaq: XETA).

Friday

Get ready to get busy on Friday, with a grand slam of reports due, including Personal Income & Outlays, the Chicago area manufacturing report, University of Michigan Consumer Sentiment and Farm Prices to close it out.

The closely followed and very important Personal Income & Outlays Report will be released at 8:30 a.m. Bloomberg's consensus forecasts personal income growth of 0.2% for April. Income growth is unfortunately indirectly pressured by international competition for goods and services that leads American firms to seek cost consolidation. American Axle, which settled with the UAW last week, suffered through a long strike for the sake of cost reduction, achieving a significant savings in wage rates and in pension benefit liability. The length that American Axle was willing to go is a testament to the significance of market force pressures.

The big headline on Friday will of course be personal consumption expenditures, as the market seeks to understand just how much the American consumer is actually tightening his belt. Bloomberg's surveyed economists see an increase of 0.2% for April. Lehman Brothers (NYSE: LEH) was quoted in Barron's seeing a 0.3% increase. Do not neglect the very important impact of price rise on the spending increase. The real spending change is what matters here, or that excluding inflation.

The University of Michigan/Reuters weighs in on Consumer Sentiment on Friday, and the consensus sees the May measure reaching 59.5 (same as the earlier check), compared to 62.6 in April.

Chicago area manufacturing gets a check up on Friday as well, and economists see the regional index at 48.5 in May, versus 48.3 in April. Farm prices are also on tap, marking the second chew on food inflation this week.

Treasury Secretary Paulson is scheduled to visit the Middle East to appease foreign investor concern, as Congress discusses the issue of sovereign investment. It's likely the issue came up during President Bush's visit, and so he's now sending Paulson to further quell concern.

Friday's short list of earnings reports includes China Finance Online (Nasdaq: JRJC), Graham Corp. (AMEX: GHM), Kirkland's (Nasdaq: KIRK), Lion's Gate Entertainment (NYSE: LGF), Medical Action Industries (Nasdaq: MDCI) and Tiffany & Co. (NYSE: TIF).

Please join us all week long as we comment on the stock market, commodity, currency and economic environment.

See our disclosure at the Wall Street Greek website.

While many would label Ben Bernanke the April fool, the market might instead slap that tag on the foreheads of the countless pundits who came out last week calling the stock market’s bottom. However, Friday’s key employment report from the Labor Department holds the potential to sink shares into new low territory and make the pundits look foolish.

The market moved lower last week, but lost some pizzazz, which is a good thing in this case. Volatility diminished, which is perhaps a sign that bad news is getting old, while hope remains on the back burner for later offering. The Dow Industrials moved lower 1.2% on the week (-7.9% Ytd.), while the S&P 500 fell 1.1% (-10.4% Ytd.). The Nasdaq Composite actually rose fractionally, which illustrated the hopeful nature of the market last week. When we eventually begin rising in earnest, you can expect low-quality growth stocks to lead the way, in our view.

Whether we experience a special economic contraction this time around, or just one of average variety, should depend greatly on how well the Fed is capable of keeping capital flowing to vital organs. I hear you! This is at the expense of the dollar... Still, the reason I'm encouraged by Fed effort is because I have great concern about the leverage that pervades our every facet of life. I do not think that quitting the addiction of leverage cold turkey is worth the pain of withdrawal from liquidity, as I'm not sure we'll survive it. We need to wean the economy back to health and then wean ourselves off leverage through stricter regulation. Force feeding America, and the financial system, to suddenly find religion will only hurry our race to financial Armaggeddon.

The Week Ahead

Monday

The first quarter ends, and the week kicks off with news from the Midwest, when the National Association of Purchasing Managers – Chicago reports on the area’s manufacturing condition in March. Considering that the Philly Fed Survey posted a negative 17.4 and the Empire State Manufacturing Survey was measured at negative 22.2, we would be surprised to find good news even from the Midwest at this point in the economic cycle. Bloomberg pinpoints economist expectations close to ours, with the consensus looking for a reading of 46.0 in March. Recall that a measure short of 50.0 signifies economic contraction and matches with the results of New York and Philadelphia regions.

Treasury Secretary Hank Paulson is scheduled to make a speech on recent issues, while San Francisco Fed President Janet Yellen is set to talk about foreclosures and community development.

The Democrats are supposed to decide on whether to invite the potentially influential Floridian delegation to their convention. The USDA will issue its crop report, as commodity traders anxiously await to see how particular plants stand in farmers' acreage plans.

Earnings lighten considerably this week, but expect reports from H.B. Fuller (NYSE: FUL), Abraxis Biosciences (Nasdaq: ABII), A-Power Energy Generation Systems (Nasdaq: APWR), Banks.com Inc. (AMEX: BNX), Carrington Laboratories (Nasdaq: CARN) and Clarient Inc. (Nasdaq: CLRT).

Tuesday

We’ll have a second serving of manufacturing news, when the Institute for Supply Managers reports its manufacturing index for March on Tuesday. February’s data measured at 48.3, again representing contraction of business activity. Economists expect the index to reach only 48.0 this time around, according to Bloomberg.

Motor vehicle sales are reported at the beginning of each month, and you can expect an April Fools' joke of a report this time around. We here at The Greek will be keen to see this week’s ICSC-UBS same-store sales data, considering last week’s report showed growth cut off at the knees, with sales rising just 1.0%. This compared to growth rates upward of 2.0% in February.

Construction spending in February is seen having decreased 1.1%, compared to a decline of 1.7% in January. Of important international note, Japan's tanken survey of March business sentiment is due on Tuesday.

In equity market news, Russell Investments expects to launch global equity indexes. In Vegas, the very interesting CTIA Wireless Industry show kicks off. Tuesday's earnings include Immucor (Nasdaq: BLUD), Adstar Inc. (Nasdaq: ADST), Alseres Pharmaceuticals (Nasdaq: ALSE), Exfo Electro-Optical (Nasdaq: EXFO), OMNOVA Solutions (NYSE: OMN), Rus Berrie (NYSE: RUS) and Telkonet (NYSE: TKO).

Wednesday

Starting on Wednesday, the economic community goes on employment watch, with the regular monthly bombardment of jobs data beginning. The first news will come from the Challenger Job-Cut Report before the market open. This data offers a look into the monthly planned layoffs of American companies. After starting the year mildly, the last two months of data have offered upward of 70K planned firings.

Also before the market open Wednesday, ADP will post its employment report that covers job market changes in the private sector. This data, which acts as a preview to the Labor Department’s pending news, turned negative last month, when 23,000 jobs were reported lost. Many of those recently unemployed folks held positions in the manufacturing sector. So, it should be no surprise then why economists expect factory orders to post a decline of 0.6% for the month of February.

Every Wednesday brings two regular reports. In the early morning, the Mortgage Bankers Association posts its take on weekly mortgage activity. After long-term rates declined sharply (0.24%) on the last fed funds rate cut (0.75%), mortgage applications came to life according to last week's data. Refinancings of course led the way, and that has to be a good thing. The Fed might have finally found critical threshold to help Americans lower their capital costs, and for a lucky few who may still have equity in their newly purchased abode, an opportunity to get out of difficult loan agreements.

Also reporting on a regular basis, the EIA Petroleum Status Report is once again important to traders. Speculation has left the building, and investors are now concerned about domestic consumption in a recessionary environment. Also, the strategic oil reserve has been topped out, so one special source of draw is off the table. In other words, all signs point to lower oil prices... except Iran, which looms as an ever present event risk. Oh, and then there's the dollar...

Just in time to take credit for mortgage activity, the Fed Chief will be in the spotlight a couple times this week. Bernanke will reach Capitol Hill on Wednesday, as he testifies before the Joint Economic Committee, addressing the economic outlook.

Wednesday earnings include Research in Motion (Nasdaq: RIMM), Best Buy (NYSE: BBY), Micron Technology (NYSE: MU), Monsanto (NYSE: MON), AngioDynamics (Nasdaq: ANGO), Blonder Tongue Labs (AMEX: BDR), CarMax (NYSE: KMX), Finlay Enterprises (Nasdaq: FNLY), Landec Corp. (Nasdaq: LNDC), Lululemon (Nasdaq: LULU), RegeneRx Bio (AMEX: RGN), Rex Stores (NYSE: RSC), Ruby Tuesday (NYSE: RT) and UniFirst (NYSE: UNF).

Thursday

The Fed concludes its public appearance parade on Thursday as Bernanke sticks around the Capitol in order to testify before Congress on the Bear Stearns (NYSE: BSC), JP Morgan Chase (NYSE: JPM) deal. Ben will be joined by JPM's Jamie Dimon for some must see TV. Fed bosses Yellen and Mishkin are both set for evening appearances on Thursday.

Thursday offers the Monster Employment Index, which measures job postings at some 1,500 websites. The data is considered more important than the Help-Wanted Index, now that everyone gets their news online. The Monster Index decreased slightly last month to 165.

Weekly initial jobless claims takes a backseat this week to all the other employment data, but offered no comfort last week when reported at 366K. We have noticed the Bloomberg consensus figure regularly predicting no change in new claims, so either economists find difficulty in predicting week-to-week change or there are in fact no significant forecasts.

ISM’s take on the non-manufacturing sector comes Thursday morning, and since the service sector is so important to American economic growth, this report carries weight. February’s data came in at a still expansionary reading of 50.8, but economists are calling for a drop to 49.0 for the March measure. EIA's Natural Gas report is set for its usual release at 10:30 a.m.

Thursday's earnings reports include Acuity Brands (NYSE: AYI), Constellation Brands (NYSE: STZ), Cascade Corp. (NYSE: CAE), Hooker Furniture (Nasdaq: HOFT), Lawson Software (Nasdaq: LWSN), Matrix Service (Nasdaq: MTRX), Rostelecom (NYSE: ROS), RPM Int'l (NYSE: RPM), Saba Software (Nasdaq: SABA) and Schnitzer Steel (Nasdaq: SCHN).

Employment Friday

As the drum rolls, Friday brings the highly anticipated Employment Situation Report. Before the market opens, we will discover if unemployment increased from last month’s level of 4.8%. Remember, the unemployment rate did not make sense last month, since we lost jobs during the period. The government noted a high degree of individuals leaving the workforce altogether. But, these people did not officially leave the workforce because they retired fat and wealthy. Rather, unemployment benefits ran out for a good number of them.

So, this seemingly positive data actually represented rather dire news. How are those people suppose to now pay their mortgages, fuel their vehicles and even eat... Economists expect the unemployment rate to return to 5.0% in the March reading.

Nonfarm payrolls dropped sharply last month, and traders will be on edge as we await this month’s data, with the economy deeper in what most believe is recession. The consensus of economists surveyed by Bloomberg expects jobs to have decreased by 50,000 in March. The report threatens to sober up antsy market pundits, and make some look like April fools.

Friday's short list of earnings reports includes A. Schulman (Nasdaq: SHLM), Family Dollar (NYSE: FDO), The Mosaic Company (NYSE: MOS), AZZ Inc. (NYSE: AZZ) and Blyth (NYSE: BTH). Markets in China, Hong Kong and Taiwan are closed Friday.

We hope you have again found value in our weekly market-moving event planner, and we look forward to providing your daily commentary each day. Please find our disclosure at Wall Street Greek.