Einhorn bets on major currency 'death spiral'

Major institutions should be broken up if necessary, Greenlight manager says

 

"NEW YORK (MarketWatch) -- Greenlight Capital is betting on the possibility of a major currency collapse and a surge in interest rates, the hedge-fund firm's manager David Einhorn said Monday, citing ballooning government deficits in some of the world's most developed countries."

 

"No institution should be too big to fail, Einhorn contended. "The real solution is to break up anything that fails that test. Lehman shouldn't have existed in any size to threaten the financial system." The same applies to Citigroup and Bear Stearns, which J.P. Mortgage Chase & Co. acquired, as well as American International Group Inc. and "dozens" of other firms, he said."

http://www.marketwatch.com/story/einhorn-bets-on-major-currency-death-spiral-2009-10-19

Homes: About to get much cheaper

National home prices are forecast to shrink another 11%. Miami, Las Vegas and Phoenix will record steep declines, but a few cities will actually post gains.

 

"NEW YORK (CNNMoney.com) -- If you thought home prices were bottoming out, you may be wrong. They're expected to head a lot lower. Home values are predicted to drop in 342 out of 381 markets during the next year, according to a new forecast of real estate prices."

http://money.cnn.com/2009/10/20/real_estate/home_price_forecast/index.htm?cnn=yes

 

National home prices are forecast to shrink another 11%.

 

Is that with or with-out government intervention (ie the $8000 tax credit) ????

 

I predict that house prices will not fall that far, but only because I predict the gov't will take even more invasive steps to halt the slide.  Steps like expanding the house purchase tax credit and subsidizing states/cities to subsidize home purchases.

 

The article predicts that house prices will rebound some 3.4% in 2011 (if I recall correctly).  However, there is no mention in the article about what interest rates were used to create this prediction. 

 

Will mortgage rates still be this low in 2011?  If not, don't expect any increase in home prices absent even more gov't subsidies.

National home prices are forecast to shrink another 11%.

 

Is that with or with-out government intervention (ie the $8000 tax credit) ????

 

I predict that house prices will not fall that far, but only because I predict the gov't will take even more invasive steps to halt the slide.  Steps like expanding the house purchase tax credit and subsidizing states/cities to subsidize home purchases.

 

The article predicts that house prices will rebound some 3.4% in 2011 (if I recall correctly).  However, there is no mention in the article about what interest rates were used to create this prediction. 

 

Will mortgage rates still be this low in 2011?  If not, don't expect any increase in home prices absent even more gov't subsidies.

 

This brings up a good topic. I think a lot of the 'economist' or wall streeters (including myself) that have not painted rosy pics of the near future or even predicted worse conditions this year, are underestimating government intervention in the system. From the Dow, to home price declines, to interest rates, to GDP, these items are outperforming many predictions because the Feds are directly manipulating these economics and markets (by the trillions).

 

I think there will be a drop in home prices even with an extended or increased house credit, but not as big as predicted. To many jobs are being lost and to many foreclosures are happening not to affect home prices next year. I also think that interest rates are going to go up in the next year or so. External pressures from others governments, and major economic players are increasing by the day. The FEDs will only be able to keep this up for so long.

^ I agree that the Feds will try to hold back market forces but will ultimately not be able to completely do so.  Eventually, assuming we end up with something that resembles a free market, market forces will have to prevail.

 

However, I'm pretty sure the gov't will do all it can to slow the fall of prices.  I suspect house prices will eventually fall another 11%, but not nearly as quicky as they would without all the intervention.  It make take 3 years instead of 12 months to do so in real terms. 

 

But 3 years from now, inflation is likely to be a big issue.  And if it's not, then the economy will be in whole lot worse shape than I could ever imagine.

 

A quick look across the pond (both sides) to see how Europe and Japan are doing. Sometimes it makes everyone feel better if they know others are feeling their pain as well.

 

Sweden:

“Husqvarna slashes staff in Sweden as profits fall….Truck maker Volvo posts heavy losses….Riksbank keeps interest rate at 0.25 percent….Ericsson hit by falling profits….Credit loses dent profits at SEB….Swedbank’s losses worse than expected.”

http://thehousingbubbleblog.com/?p=5696#comments

 

Germany:

Bankers Stonewall Investigators in Crisis Probes

"The investigation into public bank BayernLB highlights the problems the German justice system faces in tackling the shortcomings that led to the financial crisis. Investigators are overwhelmed, and managers and supervisors have formed a wall of silence."

http://www.spiegel.de/international/spiegel/0,1518,655951,00.html

 

U.K. Economy Unexpectedly Shrinks in Longest Slump (Update2)

"Oct. 23 (Bloomberg) -- U.K. gross domestic product unexpectedly dropped in the third quarter as enduring slumps in services, manufacturing and construction kept the economy mired in its longest recession on record. The pound tumbled."

http://www.bloomberg.com/apps/news?pid=20601068&sid=aA4yuANivXCQ

 

Japan:

Land of Rising Debt: Falling Tax Revenue Forces Japan to Sell More Bonds

"Japan’s national debt accounts for 170% of its $5 trillion gross domestic product (GDP), and estimates say the figure will balloon to between 200% and 250% sometime next year."

http://www.moneymorning.com/2009/10/21/japan-bonds-debt/

ING to split banking and insurance operations

To sell discounted shares, repay half of state aid

 

"LONDON (MarketWatch) -- Citing pressure from the European Commission's antitrust enforcers, ING on Monday announced a sweeping plan to break itself apart as well as to repay some of the state aid that Holland has provided."

http://www.marketwatch.com/story/ing-to-split-banking-and-insurance-operations-2009-10-26

 

Trying to Rein In ‘Too Big to Fail’ Institutions

 

"A senior administration official said on Sunday that after extensive consultations with Treasury Department officials, Representative Barney Frank, the chairman of the House Financial Services Committee, would introduce legislation as early as this week. The measure would make it easier for the government to seize control of troubled financial institutions, throw out management, wipe out the shareholders and change the terms of existing loans held by the institution."

http://www.nytimes.com/2009/10/26/business/economy/26big.html

 

This is starting to get interesting. It just a shame we didn't/don't follow our current rules for controling monoplies. If we did we wouldn't need this type of government intervention in the business system. The fight for power is growing.

 

And on the topic of 'to big to fail'. Here is a look at the top five financial institutions derivative contracts (with a lot of it nothing more than toxic).

 

1. JPM0RGAN CHASE - $81 Trillion

2. BofA - $78 Trillion

3. G0LDMAN - $48 Trillion

4. M0RGAN - $39 Trillion

5. C1T1GROUP - $32 Trillion

 

Compare the toxic level with their current assets.

 

1. JPM0RGAN CHASE - $2 Trillion

2. BofA - $2.3 Trillion

3. G0LDMAN - $925 billion

4. M0RGAN - $626 billion

5. C1T1GROUP - $1.8 Trillion

(Source - http://www.occ.treas.gov/ftp/release/2009-72a.pdf)

 

If this leveraged market continues to imploded and/or is forced to show its real value, we won't be able to print our way out this one.

JPMorganChase as a 40:1 ratio.  Isn't that the same ratio of oil to gasoline used in my chainsaw?

 

Anyway, as the cental bankers begin to slowly withdrawl their 'quantitative easining', it will be interesting to see how the banks hold up. I bet the rate of easing (as in, FED buying toxic assets from banks) will end up matching the rate at which banks can report write-downs and still show a small profit.  Based in the numbers above, that could take many years.

 

 

JPMorganChase as a 40:1 ratio. Isn't that the same ratio of oil to gasoline used in my chainsaw?

 

Anyway, as the cental bankers begin to slowly withdrawl their 'quantitative easining', it will be interesting to see how the banks hold up. I bet the rate of easing (as in, FED buying toxic assets from banks) will end up matching the rate at which banks can report write-downs and still show a small profit. Based in the numbers above, that could take many years.

 

 

 

Slowly let the blood out over a long period of time and hope the patient is alive at the end.

Wake me up when we start seeing year over year increases. Until then the direction of US home prices continue to go down, at a slower declining slope.

 

U.S. home prices rise in August, Case-Shiller says

Prices down 11.3% in the past year in 20 major cities

 

"In the past year, prices are down 11.3% in the 20 cities. Prices in all 20 cities were lower in August 2009 than in August 2008, but in general, year-over-year declines have lessened."

http://www.marketwatch.com/story/us-home-prices-rise-in-august-case-shiller-says-2009-10-27

 

Confidence drops for second straight month in Oct.

Assessment of current conditions lowest in 26 years

http://www.marketwatch.com/story/confidence-drops-for-second-straight-month-2009-10-27

 

I thought the data had no place to go but up? The economist, FEDs, Wall Street, etc... all said so. Could they have just been blow smoke out of their butts? That would be a huge surprise, since they have accurately forecasted all of the economic events over the last 3 years so correctly and honestly. When does these groups finally lose all creditability in the eye of the American people? The world has started to figure this out, when will Main Street?

The world has started to figure this out, when will Main Street?

 

I think the economist, FEDs, Wall Street, etc... all  have figured out Main street will never figure out that they don't know what they are predicting.  All Main street hears is "things are likely to get worse before they get better", 'we're bottoming out", and "Things will be better by xxxx quarter".  If it's not one of these 3, Main street can't handle it.

 

We are no longer a nation of skeptics.  At one time, we were.  That kept big gov't in check for some 150+ years.  While many skeptics remain, the general population has lost it's fear of gov't and instead embraced it.  I'm not talking political parties here, as both major ones are similar.  I'm talking about a general lack of concern amoung the American people that gov't is not necessarily out for their (people's) best interest.  The old saying was "you can't fight city hall".  I think most people are never in a situation where they want to fight city hall on something, so they don't see how gov't can run over people if it so chooses.

 

Now, investors are a bit different when it comes to Wall street.  Investors can easily get skeptical.  I think the economist, FEDs, Wall Street, etc... all  are afraid of what happens when foreign investors stop believing them.  I suspect their game plan at that point is to sell everything and run for cover.

Here is a GREAT article to show just how much the American taxpayer has been fleeced. It's well worth the time to read this article. I think its time the American people know who got the $2 Trillion+.

 

The New York FED decided to pay 100% 'value' for these swaps. Guess who the chairman of the board of directors of the New York Fed was when this decision was made. Stephen Friedman, chairman of Goldman Sachs.

 

New York Fed’s Secret Choice to Pay for Swaps Hits Taxpayers

 

"Goldman Sachs"

 

"The deal contributed to the more than $14 billion that over 18 months was handed to Goldman Sachs, whose former chairman, Stephen Friedman, was chairman of the board of directors of the New York Fed when the decision was made. Friedman, 71, resigned in May, days after it was disclosed by the Wall Street Journal that he had bought more than 50,000 shares of Goldman Sachs stock following the takeover of AIG. He declined to comment for this article."

 

"The Federal Reserve has been reluctant to publish information on its efforts to stabilize the financial system since the crisis began. The Fed has loaned more than $2 trillion, yet it refuses to name the recipients of the loans, or cite the amount they borrowed, saying that doing so may set off a run by depositors and unsettle shareholders."

http://www.bloomberg.com/apps/news?pid=20601109&sid=a7T5HaOgYHpE

Why isn't this called fraud?????

Why isn't this called fraud?????

 

Because the FEDs, the Treasury and certain Wall Street firms are above the law or not held to the law by those appointed to enforce the laws of the land.

The world has started to figure this out, when will Main Street?

 

We are no longer a nation of skeptics.  At one time, we were.  That kept big gov't in check for some 150+ years.  While many skeptics remain, the general population has lost it's fear of gov't and instead embraced it.  I'm not talking political parties here, as both major ones are similar.  I'm talking about a general lack of concern amoung the American people that gov't is not necessarily out for their (people's) best interest.  The old saying was "you can't fight city hall".  I think most people are never in a situation where they want to fight city hall on something, so they don't see how gov't can run over people if it so chooses.

 

I think it's because many large corporations don't do anything for us except rob of us our livelihood. It used to be that GM was the company that put food on everyone's table and made cars that people wanted. Now they are known just as the ones that took away our transportation options, moved production outside the US, makes chintzy cars and gets "free money" form the government. The downtown department store that featured hours of fun an entertainment for shoppers, knowledgeable, fairly well-paid salespeople, a classy shopping experience and streetlife has been replaced by Wal-Mart, with bland stores full of white trash, crummy goods, a staff not expected by the store (or the customer) to know anything and products from Third-World countries. Nice restaurants have been ran out by chains full of fatty foods.

 

The overall trust of the government today is a byproduct of the complete mistrust of large corporations. We are in a time similar to Sherman's "Trustbusting" era of the 1890s.

The world has started to figure this out, when will Main Street?

 

We are no longer a nation of skeptics.  At one time, we were.  That kept big gov't in check for some 150+ years.  While many skeptics remain, the general population has lost it's fear of gov't and instead embraced it.  I'm not talking political parties here, as both major ones are similar.  I'm talking about a general lack of concern amoung the American people that gov't is not necessarily out for their (people's) best interest.  The old saying was "you can't fight city hall".  I think most people are never in a situation where they want to fight city hall on something, so they don't see how gov't can run over people if it so chooses.

 

I think it's because many large corporations don't do anything for us except rob of us our livelihood. It used to be that GM was the company that put food on everyone's table and made cars that people wanted. Now they are known just as the ones that took away our transportation options, moved production outside the US, makes chintzy cars and gets "free money" form the government. The downtown department store that featured hours of fun an entertainment for shoppers, knowledgeable, fairly well-paid salespeople, a classy shopping experience and streetlife has been replaced by Wal-Mart, with bland stores full of white trash, crummy goods, a staff not expected by the store (or the customer) to know anything and products from Third-World countries. Nice restaurants have been ran out by chains full of fatty foods.

 

The overall trust of the government today is a byproduct of the complete mistrust of large corporations. We are in a time similar to Sherman's "Trustbusting" era of the late 1890s.

 

Channeling EC?  LOL  ;)

Economy grows in 3Q, signals end of recession

By JEANNINE AVERSA AP Economics Writer

 

"WASHINGTON—The economy grew at a 3.5 percent pace in the third quarter, the best showing in two years, fueled by government-supported spending on cars and homes. It's the strongest signal yet that the economy has entered a new, though fragile, phase of recovery and that the worst recession since the 1930s has ended. Going forward, many analysts expect the pace of the budding recovery to be plodding due to rising unemployment and continuing difficulties by both consumers and businesses to secure loans."

http://www.denverpost.com/ci_13666896

 

So this is what we got for Trillions! I guess history will tell us if it was worth it and if it was enough to avoid bigger issues in the future. It concerns me that the bulk of the growth was in auto sales (cash for clunkers, 1.66 of the GDP), home ($8,000 credit) and other government spending. With cash for clunkers gone that number is going to drop significantly for the next GDP. But, the $8,000 for homes will continue and so will government stimulus spending. With the real economy and job lose still flat on its back it should be interesting to see how Holiday spending and 2010 go. It should also be interesting to see how this number is adjusted over time. If recent history is any indication, this number will end up being much lower in the future.

Just wait until oil is bought in Euro's instead of the dollar. I don't blame them for switching.

Yay, recession is over! Now where is my bailout?

 

As my ultra fabulous Aunt would say, "What recession?  Chulo, pass me those Jimmy Choo's."  LMAO

Yay, recession is over! Now where is my bailout?

 

It was waiting for you with C4C and is still waiting for you with $8,000 if you buy a house. What more do you want. Billions for an end of the year bonus. To get that you must first run you company into the ground and then ask for trillions from the taxpayer. Then you can have your billion+ dollar bailout. :wink:

U.S. Home Vacancies Rise to 18.8 Million on Defaults (Update1)

 

"The number of vacant properties, including foreclosures, residences for sale and vacation homes, rose from 18.4 million a year earlier and 18.7 million in the second quarter, the U.S. Census Bureau said in a report today."

 

"Sales of new U.S. homes fell 3.6 percent in September to an annual pace of 402,000, the Commerce Department said yesterday. That was lower than the 440,000 median forecast of 75 economists surveyed by Bloomberg News."

http://www.bloomberg.com/apps/news?pid=20601103&sid=aNQJ9BUq2_yM

 

'Up, up and away in my beautiful, my beautiful, balloon.'

layoff are up and for those who have jobs, the cost you pay for benefits has increased.

I think, though, that perhaps the economy is nearing an inflexion point.  The economic data coming out is a bit mixed these days. New home sales were down last month (look for 'used home' sales to be up).  However, Durable goods orders are up.  This pattern is being repeated weekly now.

 

Of course, the gov't is jerking certain sectors around these days, so that needs to be somehow adjusted for.

 

Overall, the US economy reminds me of the Russian sub the "Kirst".  Following an internal explosian and a gaping whole, it quickly sank to the ocean floor and sat there for some time.

http://money.cnn.com/2009/11/01/news/companies/cit_group/index.htm?postversion=2009110116

 

CIT Group Inc., one of the nation's leading funders of small and medium-sized businesses, filed for the fifth largest bankruptcy by assets in U.S. history Sunday as part of a reorganization plan that has the support of an overwhelming majority of debtholders.

Factory sector strengthens in October

ISM hits 55.7%, best since April 2006; production index at five-year high

 

"WASHINGTON (MarketWatch) -- The nation's manufacturing firms grew at the fastest pace in more than three years in October, according to a closely followed survey of top executives released Monday."

 

"One grey cloud in a sunny report was that the new-orders index fell in October, slipping to 58.5% from 60.8% in September, the ISM's data showed. This is the second monthly decline in orders."

http://www.marketwatch.com/story/factory-sector-surges-in-october-ism-says-2009-11-02

 

Hopefully this upswing will be sustainable. But, if new orders continue to fall it will only be time before it starts to show up in ISM data.

Pending home sales are up as well....

 

http://news.moneycentral.msn.com/provider/providerarticle.aspx?feed=OBR&date=20091102&id=10624330

 

National Association of Realtors showed the real estate group's Pending Home Sales Index, based on contracts signed in September, rose 6.1 percent to 110.1 -- the highest level since December 2006.

 

It was the eighth straight monthly rise in the index, the longest streak since the measurement started in 2001. Markets had expected pending home sales, which lead existing home sales by one to two months, to be flat in September after rising to 103.8 in August.

------------------------------------

 

I think there was only so much contraction that the economy could do and sustain itself.  The percent of Disposable income in American's housholds is a lot lower today than it was 30 years ago.

 

It appears that the economy is nearing a new, lower base line from which to expand. Yes, there is likely some new downward pressure here and there, but overall I think the economy has contracted about as much as it will.

 

I see this as a new "lower plateau" from which to grow, but I don't see anything beyond general population increase and gov't spending to help it grow.  I don't think the increase in manufacturing will save our economy. I suspect it's not sustainable either.

 

 

Buffett's Berkshire buys Burlington Northern

 

"NEW YORK (MarketWatch) -- Warren Buffett's Berkshire Hathaway on Tuesday said it is spending $44 billion to buy out railroad operator Burlington Northern Santa Fe, sealing the biggest acquisition in the company's history in what the famed investor called "an all-in wager on the economic future of the United States."

http://www.marketwatch.com/story/berkshire-buys-burlington-northern-2009-11-03

 

This is very interesting. Warren Buffett is not a idiot, he may not always be right, but this is a huge 'wager'. He is very well connected and I am sure has info the average person doesn't.

 

With that said, here is my little world take on this. He is preparing for inflation in oil prices and the increase demand to transport goods and people on rail in the future.

 

44 billion? How much more money does a guy want to make?

Is this our future? With Japan and Britian already in front. The default of one or both of these would send shockwaves throught the world financial system.

 

It is Japan we should be worrying about, not America

 

"Japan is drifting helplessly towards a dramatic fiscal crisis. For 20 years the world's second-largest economy has been able to borrow cheaply from a captive bond market, feeding its addiction to Keynesian deficit spending – and allowing it to push public debt beyond the point of no return."

 

"The rocketing cost of insuring against the bankruptcy of the Japanese state is telling us that the model has smashed into the buffers. Credit default swaps (CDS) on five-year Japanese debt have risen from 35 to 63 basis points since early September. Japan has suddenly decoupled from Germany (21), France (22), the US (22), and even Britain (47)."

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/6480289/It-is-Japan-we-should-be-worrying-about-not-America.html

Those countries have issues that go so far beyond America's it's pretty amazing. If you would like to see their future, I'd have them look at the Netherlands if they are hopeful and Venice and Genoa if not so hopeful.

Fannie Mae to rent out homes instead foreclosing

 

"WASHINGTON – Thousands of borrowers on the verge of foreclosure will soon have the option of renting their homes from Fannie Mae, under a policy announced Thursday.

 

The government-controlled company, through its new "Deed for Lease" program, will allow borrowers to transfer ownership to Fannie Mae and sign a one-year lease, with month-to-month extensions after that."

http://news.yahoo.com/s/ap/20091105/ap_on_bi_ge/us_foreclosures_rentals;_ylt=ArdHYkdJkvGw23fedY8k56JH2ocA;_ylu=X3oDMTNjMW83dnM0BGFzc2V0A2FwLzIwMDkxMTA1L3VzX2ZvcmVjbG9zdXJlc19yZW50YWxzBGNjb2RlA21vc3Rwb3B1bGFyBGNwb3MDNgRwb3MDNgRzZWMDeW5fdG9wX3N0b3JpZXMEc2xrA2Zhbm5pZW1hZXRvcg--

 

I say this is just more window dressing and will have very little impact on foreclosures.

 

 

Fannie Mae to rent out homes instead foreclosing

 

"WASHINGTON – Thousands of borrowers on the verge of foreclosure will soon have the option of renting their homes from Fannie Mae, under a policy announced Thursday.

 

The government-controlled company, through its new "Deed for Lease" program, will allow borrowers to transfer ownership to Fannie Mae and sign a one-year lease, with month-to-month extensions after that."

http://news.yahoo.com/s/ap/20091105/ap_on_bi_ge/us_foreclosures_rentals;_ylt=ArdHYkdJkvGw23fedY8k56JH2ocA;_ylu=X3oDMTNjMW83dnM0BGFzc2V0A2FwLzIwMDkxMTA1L3VzX2ZvcmVjbG9zdXJlc19yZW50YWxzBGNjb2RlA21vc3Rwb3B1bGFyBGNwb3MDNgRwb3MDNgRzZWMDeW5fdG9wX3N0b3JpZXMEc2xrA2Zhbm5pZW1hZXRvcg--

 

I say this is just more window dressing and will have very little impact on foreclosures.

 

 

 

True, but it does keep renters from ending up out on the streets and then later suffering the inconvenience and cost of moving involuntarily.

More green shoots (squirts) for Wall Street. We are not at the bottom yet.

 

Unemployment in U.S. Jumps to 10.2%, Payrolls Fall (Update3)

 

"Nov. 6 (Bloomberg) -- The unemployment rate in the U.S. soared to a 26-year high of 10.2 percent in October and employers cut more jobs than forecast, underscoring why Federal Reserve policy makers say interest rates will remain near zero.

 

Payrolls fell by 190,000 workers last month, compared with a 175,000 drop anticipated by the median forecast of economists surveyed by Bloomberg News, figures from the Labor Department showed today in Washington. The jobless rate gained from 9.8 percent in September and exceeded 10 percent for the first time since 1983."

http://www.bloomberg.com/apps/news?pid=20601087&sid=aM5vmVlHcV6A&pos=1

^

from the bloomberg article:

 

Construction jobs continue to fall.....

 

Payrolls at builders declined 62,000 after a loss of 68,000 in September.

 

Now it's time to finish that Sprinsteen song we started a month ago..

 

(our young hero had just gotten married to his pregnant girlfriend right out of high school...)

 

 

I got a job working construction for the Johnstown Company

But lately there ain't been much work on account of the economy

Now all them things that seemed so important

Well mister they vanished right into the air

Now I just act like I don't remember

Mary acts like she don't care

 

But I remember us riding in my brother's car

Her body tan and wet down at the reservoir

At night on them banks I'd lie awake

And pull her close just to feel each breath she'd take

Now those memories come back to haunt me

they haunt me like a curse

Is a dream a lie if it don't come true

Or is it something worse

that sends me down to the river

though I know the river is dry

That sends me down to the river tonight

Down to the river

my baby and I

Oh down to the river we ride

Thanks for putting the thread together.

October retail sales rise 1.4% on rebound in autos, U.S. says

Excluding cars, monthly sales increase by 0.2%

 

"Compared with last October, retail sales were down 1.7% to $347.5 billion, while sales excluding autos were down 2.6% to 288.5 billion. The figures are not adjusted for price changes."

 

"Through the first 10 months of 2009, sales have totaled $3.38 trillion, down 8.2% compared with the same period a year earlier."

http://www.marketwatch.com/story/retail-sales-rise-14-on-rebound-in-autos-2009-11-16

 

2008 Oct. $353.6B

This type of data continue to show the weakness in the retail industry. While its great to see small improvements over the last few months (they revised September down to get a big October up) we are still well below 2008 data and that data was in the heart of the deepest recession in US history. So how are we still not in a deep recession since retail makes up a large percentage of the US economy and its worse than last year? And this is with all the trillions from the stimulus? Nothing more than FED, Wall Street spin.

 

At this time last year the Dow was at 8,200 with better retail sales data. Now we have a Dow at 10,400 with worse retail sales numbers. Just thinking.

Companies have fewer costs due to all the layoffs and thus bigger profits.  Not to mention that companies often purposely understate their earning forecasts.  Not to mention our trade exports have been rock solid due to the falling dollar.  Not to mention people still lack fiscal responsibility.  And a whole ton of other reasons.  That's why we're over 10000.

 

Companies have fewer costs due to all the layoffs and thus bigger profits. Not to mention that companies often purposely understate their earning forecasts. Not to mention our trade exports have been rock solid due to the falling dollar. Not to mention people still lack fiscal responsibility. And a whole ton of other reasons. That's why we're over 10000.

 

 

So are you saying that companies in general are making better profits than they were in 2008? Because if you look at the spreadsheet of most companies that would not be true.

PRESS RELEASE

 

New USDA statistics confirm escalating hunger crisis in Ohio.

 

The USDA's Economic Research Services reported today trhat 13.3 % of Ohio's residents are "food insecure", meaning they lack consistent access to adequate amounts of nutritious food.

 

Demand at Ohio's 12 foodbanks and 3,000 member charities are up 21% over this time last year. The Feeding America study shows uniformity that its network of food banks witnessed an average increase need of nearly 30 percent this year.

 

----

 

Sorry, the press release is printed so I can't be bothered to transcribe it word for word.

 

I think these are far more accurate indicators of our current economic state than any bogus "unemployment rate" which is incredibly inaccurate due to our nation's tendency to hire part time workers and lock up millions of prisoners.

 

 

I don't doubt that data at all, though the big difference between this calamity and the 30s is that fact that the feds will keep the money flowing through the food stamp system. I'd imagine some folks find the experience of living on a very limited food budget to be very challenging for a couple months until you learn how to cook and eat more cheaply.

^They gotta switch from brand name Cheetos to Dan-Dee

Most U.S. Stocks Fall as Industrial Production Trails Estimates

 

“This industrial production number is pointing to weak manufacturing in the United States as well as weak demand,” said Chad Morganlander, a money manager in Florham Park, New Jersey, at Stifel Nicolaus & Co., which oversees about $98 billion in client assets. “This could put a wet blanket on the optimists for a day or two.”

http://www.bloomberg.com/apps/news?pid=20601087&sid=al0N.nHBofjU&pos=3

 

Nothing to see here, party on, party on.

China has now become the biggest risk to the world economy

 

"US unemployment is already 17.5pc under the broad "U6" gauge followed by Barack Obama. Realty Track said that 332,000 properties were foreclosed in October alone. More Americans have lost their homes this year than during the entire decade of the Great Depression. A backlog of 7m homes is awaiting likely seizure by lenders. If you are not paying attention to this political time-bomb, perhaps you should."

 

"The world economy is still skating on thin ice. The West is sated with debt, the East with plant. The crisis has been contained (or masked) by zero rates and a fiscal blast, trashing sovereign balance sheets. But the core problem remains. The Anglo-sphere and Club Med are tightening belts, yet Asia is not adding enough demand to compensate. It is adding supply."

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/6575883/China-has-now-become-the-biggest-risk-to-the-world-economy.html

 

This is far from being over, internally in the US or externally on a World stage.

 

The Anglo-sphere and Club Med are tightening belts, yet Asia is not adding enough demand to compensate. It is adding supply."

 

 

The same could be said about housing in the US - Overall we have a surplus.  But the NE and MW have stagnating populations, while the South and West continue to build, build, build.

 

There is a shift in location demand.  While not currently true, the past several decades have seen a shortage of housing in the South and West, despite all the building they have been doing.  There has been surplus of housing in the NE & MW, except in certain pockets.

 

It could be that for the first time in many decades, there is a surplus of housing in the South and West. 

 

As far as world manufacturing, there may be a surplus in the  high-labor cost areas, and a shortage in the low-labor cost area.  Without floating exhchange rates to compensate, that dynamic will continue for some time.

 

Panel votes to audit the Fed; cap its spending at $4 trillion

Measure would audit the Fed's monetary policies such as interest rates

 

"WASHINGTON (MarketWatch) -- Rep. Ron Paul, who has sought to audit the Federal Reserve for 26 years, has inched ever so much closer to his goal.

 

A key congressional panel on Thursday approved legislation introduced by the Texas congressman that - for the first time in the central bank's 95-year-history -- would require government audits of Federal Reserve monetary policy, as well as how much the central bank has lent and will lend to specific banks.

Fed Chief Ben Bernanke and other key members of the Obama administration, including Treasury Secretary Tim Geithner, had vigorously opposed the move."

http://www.marketwatch.com/story/panel-votes-to-audit-feds-balance-sheet-2009-11-19

 

This should be interesting to watch and could have significant inpacts on the way the FEDs do business in the future.

Paul has been itching to crack op the fed for years, decades even. It will be interesting to see how this all plays out. It's fascinating that most people do not know that the federal reserve is not a government organization.

 

 

Our cities already had thousands of abandonded properties and vacant lots before the depression even began. Couple that with the population shift to the South and West, and I think we'll be left with remarkable abandonment on a scale we've never seen before. I just hope it hits the sprawl harder than it hits the cities.

 

This is a curious thing, because the influential factors on this are all over the map. When the economy tanks, oil tanks, so mobility for Americans actually goes up a little. For a while. Nobody has any idea what a prolonged repression (recession + depression lol) will do to living patterns.

Paul has been itching to crack op the fed for years, decades even. It will be interesting to see how this all plays out. It's fascinating that most people do not know that the federal reserve is not a government organization.

 

 

 

All the more reason why it must be audited.

Paul has been itching to crack op the fed for years, decades even. It will be interesting to see how this all plays out. It's fascinating that most people do not know that the federal reserve is not a government organization.

 

 

All the more reason why it must be audited.

 

Well, yeah. I hope that's obvious to people. LOL

Unemployment rates rise in 29 states More states report rising unemployment rates, though fewer report joblessness above the national average in October. 

 

http://money.cnn.com/news/storysupplement/economy/gapmap/index.htm