By Rick Glaze

The markets are up one day and down the next as they work to digest the strong move higher following the summer dip. Professionals call this backing and filling. It is a necessary activity for a healthy stock market.

The bond market is steady and the 10-year Treasury bond is in a tight trading range around 4 percent to 5 percent. It remains below the short-term Federal funds rate of 5.25 percent, still in an inverted yield curve.

The president of California’s $6 billion stem cell institute announced his resignation after just six months. You may have thought the voters of California voted for a $3 billion project, but remember that the bonds to finance it have to be paid back with interest.

Meanwhile, the Los Angeles Times has lamented that, “Gone are the allusions to healing such afflictions such as spinal cord injuries and Parkinson’s and Alzheimer’s diseases that dominated the campaign for Proposition 71 in 2004.”

I believe the knee-jerk reaction of voters to support embryonic stem cell research with public bond funding defies sound thinking. But hey, nobody even knew what it was way back in 2004. According to reports, adult and umbilical cord research is receiving government and private money handily, and somewhere around 72 treatments have emerged as opposed to zero treatments from “the promise” of cures from embryonic research.

Remember that private money is different from public in that private investment demands results, while government money merely demands to be spent. In my opinion, it stands to reason that if the touted embryonic research were promising, private investors would flock there - but they have not.

Rick Glaze is president of Glaze Capital Management Inc. of Los Altos. He is a General Securities Principal, offering securities through First Allied Securities Inc. For more information, e-mail Rick@Glazecapital.com.