Drop in consumer prices is most since 1932

Core CPI flat in the month as energy prices plunge

 

WASHINGTON (MarketWatch) - U.S. consumer prices fell in November at the fastest rate since 1932, the Labor Department reported Tuesday.

 

The U.S. consumer price index fell by a seasonally adjusted 1.7%, the Labor Department reported Tuesday, the biggest drop since the government began adjusting the CPI for seasonal factors in 1947.

 

On a non-seasonally adjusted basis, the CPI fell by 1.9%, the biggest decline since January 1932, at the nadir of the Great Depression.

 

...

 

http://www.marketwatch.com/news/story/Drop-consumer-prices-most-since/story.aspx?guid={45513693-102D-4A67-8859-C73778BF4777}

 

Energy down BIG but, housing, medical and food were still going up in overall cost. I think CincyDad was right that we would experience Stagflation. It should be interesting to see if stagflation holds or if we see deflation and/or a huge spike in inflation over the next year or two. I have seen cases made for both.

Best Buy eyes layoffs, slows U.S. expansion

No. 1 electronics seller says it may be forced to lay off some corporate employees amid 'historic slowdown in economy.'

 

By Parija B. Kavilanz, CNNMoney.com senior writer

Last Updated: December 16, 2008: 9:55 AM ET

 

 

NEW YORK (CNNMoney.com) -- Best Buy Co. announced Tuesday that a worsening sales environment could force it to lay off employees and significantly slow its new store openings in the United States.

 

Minneapolis-based Best Buy (BBY, Fortune 500), the No. 1 electronic seller, said it had already informed "nearly all" of its 4,000 corporate employees on Monday that they are eligible for a voluntary separation package in order to reduce its corporate expenses.

 

The company said the voluntary package provides an incentive for employees who choose to leave the company by offering a "significant increase in" the company's base severance offer.

 

http://money.cnn.com/2008/12/16/news/companies/best_buy/index.htm?postversion=2008121609

It is worth noting that the angle of the inflation bubble was really steep which logically means that the return to the mean will be just as steep.

The weak will be shaken out of the market(s). The strong will swoop in and pick up the good pieces at bargain basement prices.

 

I think that may be the very last thing western civilization needs right now.  But here it comes anyway.

Fed slashes key rate to near zero

Ben Bernanke & Co. cite weakness in economy and reduced inflation threat as justification for cutting rates below 1% for first time.

http://money.cnn.com/2008/12/16/news/economy/fed_decision/index.htm?postversion=2008121614

 

I guess this particular gun is now officially out of ammo. I sure hope the bow and arrows they were talking about a week or so ago can be lite on fire or have poison on the end of them.

That will do nothing to create more jobs. Without the jobs the economy will always be weak.

I was approved for a refinance loan on my house during my lunch break today.

 

I'm keeping an eye on interest rates with the thought to do the same.  Do you think rates for refinancing will be lower in a few months given how the FED has decided to actively engage in the longer-term lending market now?

nothing funny about losing our retirement money...but these are  :laugh:

 

a wall street / vegas strip mashup:

 

 

 

http://animalnewyork.com/news/2008/12/stereo-hell-moves-the-street-t.php

I was approved for a refinance loan on my house during my lunch break today.

 

I'm keeping an eye on interest rates with the thought to do the same. Do you think rates for refinancing will be lower in a few months given how the FED has decided to actively engage in the longer-term lending market now?

 

I just saw that Third Federal is offering 30-year fixed rate loans at 5%.  The rate dropped .1% overnight. 

I was approved for a refinance loan on my house during my lunch break today.

 

I'm keeping an eye on interest rates with the thought to do the same. Do you think rates for refinancing will be lower in a few months given how the FED has decided to actively engage in the longer-term lending market now?

 

For what its worth, I think rates maybe lower in the next month or two. It will take a little time for the new rate cuts to work through the system. I also think the 'hope' with Obama taking office and the new stimulus will give the entire system a short term bump.

I was approved for a refinance loan on my house during my lunch break today.

 

I'm keeping an eye on interest rates with the thought to do the same.  Do you think rates for refinancing will be lower in a few months given how the FED has decided to actively engage in the longer-term lending market now?

 

For what its worth, I think rates maybe lower in the next month or two. It will take a little time for the new rate cuts to work through the system. I also think the 'hope' with Obama taking office and the new stimulus will give the entire system a short term bump.

I'm not locking in a rate for a few weeks, but even compared to a year ago rates are quite low now. Too low to pass up IMO.

Chrysler to idle all factories for at least a month

By Shawn Langlois

Last update: 4:54 p.m. EST Dec. 17, 2008

 

"SAN FRANCISCO (MarketWatch) -- Chrysler said Wednesday that it will idle all of its manufacturing operations starting this Friday through at least January 19 in an effort to keep inventories more aligned with plunging U.S. demand for new cars and trucks. Due to customers' inability to obtain financing, Chrysler dealers said that their sales volumes have fallen as much as 25% from a year ago."

http://www.marketwatch.com/news/story/Chrysler-idle-all-factories-least/story.aspx?guid={20EA3667-4149-4E76-AF74-F873264CACA4}

 

Chrysler is sending a major shot across the bow saying, you better give me bailout money or its over. Interesting that the date goes to the day before Obama takes office.

 

We discussed teh affects of folks losing their homes, but I wonder how many people have had their vehicle reposed?

We discussed teh affects of folks losing their homes, but I wonder how many people have had their vehicle reposed?

 

I am sure there are some stats out there, I will see if I can find anything. I will say, this recession seems to building up to another big leg down. Not good!!!!

I know a guy living in his car in order to hide it from the repo man.  The other thing is when people are deciding whether to pay on a credit card or a car loan, no doubt the car payments are being made for this very reason. 

Dah, dah, dah, dah

dah, dah, dah, dah, dah, dah, dah

Dah, dah, dah, dah

Dah, dah, dah, dah, dah, dah, dah

Dah, dah, dah

 

Inflation no chance

To increase finance

 

The change in the credit card rules recently is an interesting development. The credit card folks won big a couple years ago with the re-write of the bankruptcy laws, but this rebalances it somewhat.

Wells Fargo economists see recession's end in late 2009

Minneapolis / St. Paul Business Journal - Atlanta Business Chronicle

Friday, December 19, 2008, 2:30pm CST

 

The deepest and longest recession since the 1930s will end in the second half of 2009, Wells Fargo & Co. economists predicted in their annual forecast.

 

The third quarter of next year will be “better than expected” by many, said Jim Paulsen, chief investment strategist. “It’s like you’re at a cookout and you’re trying and trying to get your charcoal going and you keep squirting on lighter fluid, and all of a sudden it goes ‘poof!’ ”

 

Paulsen said “fear mongering” by government officials who were trying to sell the $700 billion Troubled Asset Relief Program in the fall made the situation much worse, freezing everyone in their tracks and bringing on “economic paralysis.”

 

...

 

http://twincities.bizjournals.com/twincities/stories/2008/12/15/daily54.html

The next handout Pleaseeeeeeeeeeeeeeeeeeeeeeeeeeeeeeee!!!! The concept of accepting risk is dead.

 

Real-estate developers reportedly seeking U.S. relief

 

"NEW YORK (MarketWatch) -- Developers of large commercial real-estate projects are seeking access to government investment funds as at least $160 billion of debt comes due for refinancing next year and lenders are thin on the ground for the embattled industry, the Wall Street Journal reported Monday.

 

The paper said that developers of projects like malls, hotels and office complexes are seeking access to the recently announced Treasury plan to provide $200 billion of credit relief to borrowers on auto and student loans and credit-card debt.

 

Some of the developers have also reportedly suggested a separate program aimed solely at projects in commercial real estate. The Journal's report quoted a letter that a dozen developers recently sent to Treasury Secretary Hank Paulson, in which they say: "Right now, we believe there is insufficient systemic capacity to refinance expiring, performing commercial real-estate loans. For many borrowers, [credit] simply is not available."

 

...

 

http://www.marketwatch.com/news/story/Commercial-real-estate-may-next/story.aspx?guid={B8584A95-BB8F-4DB4-A3B3-C9B183F10C92}

For crying out loud!  When does it stop?!  This is exactly why I don't believe anyone needs a handout!

 

The real estate business has OVER CAPACITY now.  they don't need to build any new crap (especially if it looks like the crap in Solon or westlake) anytime soon!  Invest in inner-city projects.

 

NO MORE HANDOUTS!

That's just asinine. It really is a slippery slope. The only reason we were suppose to bail out the financial industry was so that credit could open back up. You can't open a business or expand it without credit. That was suppose to help the auto industry, home buyers, business owners, etc. Now they're all going to go "well you gave them money, what about us?"  Printing more money is just going to cause extreme inflation. If anything, we need to force the banks to extend credit to people who deserve it. It sounds like we're giving money to banks yet the banks aren't holding up their end of the deal by lending. The banks lack of confidence in each other exacerbated the recession, now they're making it worse by not lending after being given 700 billion dollars to make it better!

What David said.  We don't not need to build things, we need projects like the flats to get going again.  Bailing out the banks themselves was supposed to free up credit for that sort of thing.  If the govt has to bail out the banks and their customers too, then what are the banks doing with the money they already got?  We went from "everyone thought real estate was worth more than it was" to "there's no money in the world anymore."  That doesn't make sense.  Money didn't just catch fire and disappear.  The physical world is no different than it was before.

What David said. We don't not need to build things, we need projects like the flats to get going again. Bailing out the banks themselves was supposed to free up credit for that sort of thing. If the govt has to bail out the banks and their customers too, then what are the banks doing with the money they already got? We went from "everyone thought real estate was worth more than it was" to "there's no money in the world anymore." That doesn't make sense. Money didn't just catch fire and disappear. The physical world is no different than it was before.

 

No but the electronic money world has lost trillions and that is were the greatest 'wealth' was calculated.

No but the electronic money world has lost trillions and that is were the greatest 'wealth' was calculated.

 

I'm suggesting that the effect of said loss on the world is at least somewhat arbitrary.  Previously, people "had" lots of fake money that did not exist.  Currently, they no longer do.  But they never did.  Nothing has actually taken place.  We still have just as much productive capacity as we did a year ago.  People didn't die off or suddenly get dumber.  Equipment still works the same way.  Materials and fuels continue to exist.  If we spend a year doing nothing because a bunch of fake value disappeared, there is no dumber race of beings in the universe.   

 

The only real loss I see is among people who sacrificed actual labor/cash/stuff to buy real estate or securities at inflated prices.  I wouldn't mind seeing that rectified.  It isn't like their money vanished.  All of it was paid to someone.  Send them a bill.

Agreed. The world still works the same, the only difference is that the economic engine is less lubricated thanks to the banks. The fed has done all it can at this point. Practically zero interest rates. The only thing that will bring us back up at this point is confidence from the banks. They have the power to make things run more smoothly. They need to lower their credit standards. They need to understand that they might have to continue losing money for a while for the sake of their own future success. I guess it's hard for them to fathom since they're accustomed to the calculability/predictability of their lending process.

Agreed. The world still works the same, the only difference is that the economic engine is less lubricated thanks to the banks. The fed has done all it can at this point. Practically zero interest rates. The only thing that will bring us back up at this point is confidence from the banks. They have the power to make things run more smoothly. They need to lower their credit standards. They need to understand that they might have to continue losing money for a while for the sake of their own future success.

 

You can't be serious??!!  :wtf:  :wtf:  :wtf:

 

People who shouldn't have credit cards will be living on borrowed money they can't pay back.  Banks should learn for offering people who can't afford homes, zero down home loans.  Look at all those people who live out in places like tacky @ss Solon or Westlake who can't afford those tacky @ss houses.  They should suffer!

and

 

People need to learn a hard lesson about living about their means.  More people need "money management" classes.  That should be apart of every loan process!

 

Obtaining credit should be hard.  It's a privilege not a right.

Agreed. The world still works the same, the only difference is that the economic engine is less lubricated thanks to the banks. The fed has done all it can at this point. Practically zero interest rates. The only thing that will bring us back up at this point is confidence from the banks. They have the power to make things run more smoothly. They need to lower their credit standards. They need to understand that they might have to continue losing money for a while for the sake of their own future success.

 

You can't be serious??!!  :wtf:  :wtf:  :wtf:

 

People who shouldn't have credit cards will be living on borrowed money they can't pay back.  Banks should learn for offering people who can't afford homes, zero down home loans.  Look at all those people who live out in places like tacky @ss Solon or Westlake who can't afford those tacky @ss houses.  They should suffer!

and

 

People need to learn a hard lesson about living about their means.  More people need "money management" classes.  That should be apart of every loan process!

 

Obtaining credit should be hard.  It's a privilege not a right.

 

Since banks have less cash flow, less value in assets now, they have no choice but to RAISE their standards. That's what I meant. Standards are artificially high.

 

I'm not just talking about households, I'm talking about firms as well. I'm curious to know if anyone here has small business and whether or not they're able to get short term credit at the moment. Almost every business now has a shrinking amount of cash on hand and their assets are worth less. So unless a bank lowers its standards, how can they have access to as much credit as they normally would? With real estate it has a huge domino effect. Imagine being a RE developer. No financing for your project, yet you have a huge overhead. You don't need the planners, architects, lawyers, engineers, construction work. Those are all firms themselves, with their own overhead. So each on ends up laying off employees which decreases productivity in the economy. But look at it this way. Money being irrelevant, all of those firms could theoretically work to produce a product (skyscraper or whatever) that has a real value in the economy and society. It just doesn't come to fruition because the financing that smooths out each transaction between firms, was never there. The organization of monetary distribution was inefficient. Every firm is interlinked, and households are interlinked with firms. Without financing, they can't be linked properly and that causes inefficiency. Resources that you need, are blocked.

 

People who shouldn't have credit cards will be living on borrowed money they can't pay back.  Banks should learn for offering people who can't afford homes, zero down home loans.  Look at all those people who live out in places like tacky @ss Solon or Westlake who can't afford those tacky @ss houses.  They should suffer!

and

 

People need to learn a hard lesson about living about their means.  More people need "money management" classes.  That should be apart of every loan process!

 

Obtaining credit should be hard.  It's a privilege not a right.

 

I'm unclear as to the connection between bad exurban housing design and managing the money supply.  If you mean sprawl construction should stop, I'm all for that.  But it will leave us with a lot of unemployed people in the building trades.  That says to me that we should press forward with construction, just do it in different places and different ways.  No construction can take place if someone's bank or someone's boss is sitting on all of the money.  To the extent that productive activity is keyed to credit, credit needs to flow.  I don't think the world should grind to a halt so people can get a patronizing lecture about how to live.

And plenty of people bought urban homes/condos they couldn't afford as well.

I'm unclear as to the connection between bad exurban housing design and managing the money supply.  If you mean sprawl construction should stop, I'm all for that.  But it will leave us with a lot of unemployed people in the building trades. That says to me that we should press forward with construction, just do it in different places and different ways.  No construction can take place if someone's bank or someone's boss is sitting on all of the money.  To the extent that productive activity is keyed to credit, credit needs to flow.  I don't think the world should grind to a halt so people can get a patronizing lecture about how to live.

 

 

You mean to tell me those skilled workers can't rework/rebuild/retrofit homes in urban area's instead?

 

Real Estate needs to changed is MOO.

 

And plenty of people bought urban homes/condos they couldn't afford as well.

 

True.  But i'm talking about those people who moved because the claim to have needed more space or were "keeping up with the Jones'".

Exactly. I don't mean to put Cincy on blast but come on, a few years ago a 2000 sq. ft. victorian farmhouse with vinyl siding and a 1950s kitchen could have sold for 400k in Hyde Park. Even people with quite a bit of money bought houses for whatever they were qualified for. Some of the hardest hit areas are in the inner city.

 

You mean to tell me those skilled workers can't rework/rebuild/retrofit homes in urban area's instead?

 

 

That's what I'm saying they should do, that's what I meant by different places/ways.

 

You mean to tell me those skilled workers can't rework/rebuild/retrofit homes in urban area's instead?

 

 

That's what I'm saying they should do, that's what I meant by different places/ways.

 

The dollar has only been on the books since July 6, 1785. So it's still a new concept in the grand theme of things. It's kinda messed up that we ruined our system in a only a few short years simple because of greed. Let everything fail that's failing then things will correct itself.

The dollar has only been on the books since July 6, 1785. So it's still a new concept in the grand theme of things. It's kinda messed up that we ruined our system in a only a few short years simple because of greed. Let everything fail that's failing then things will correct itself.

 

Amen...preach on!

 

:clap:

Retailers' holiday sales plummet: Spending Pulse

 

"NEW YORK (Reuters) – Retailers' sales fell as much as 4 percent during the holiday season, as the weak economy and bad weather created one of the worst holiday shopping climates in modern times, according to data released on Thursday by SpendingPulse.

 

The figures, from the retail data service of MasterCard Advisors, show the 2008 holiday shopping season was the weakest in decades, as U.S. consumers cut spending as they confront a yearlong recession, mounting job losses and tighter credit.

 

"It's probably one of the most challenging holiday seasons we've ever had in modern times," said Michael McNamara, vice president of Research and Analysis at MasterCard Advisors."

http://news.yahoo.com/s/nm/20081226/ts_nm/us_usa_holidaysales_spendingpulse;_ylt=AhHFSZw6TR_Ogc5nI.Q2yOgJr7sF

 

Retail closings, downsizing and reduction in new store construction is going to increase significantly in the next 6 months. This will send even more shockwaves through the commercial construction and development market.

Maybe I should send a letter to my Congressman and ask for them to bail me out?  Why can't I just personally ask for a bailout?

Congress is stupid. Consumers are stupid. George Bush is stupid. Unions are stupid. I hate America. I'm getting some investors and I'm going to buy an island, plan and design it and set up my own government. No corporation can fire based off of lost revenue so the employment rate will be almost zero. Government will require a "flex-pay" system requiring all workers to be paid based on their company's performance as a percentage of the company's earnings. In other words, they'll have a stake in the company.  My country won't be prone to extreme economic cycles, and when hard times hit, the people will be protected because the rich will lose proportionally to everyone else.

Congress is stupid. Consumers are stupid. George Bush is stupid. Unions are stupid. I hate America. I'm getting some investors and I'm going to buy an island, plan and design it and set up my own government. No corporation can fire based off of lost revenue so the employment rate will be almost zero. Government will require a "flex-pay" system requiring all workers to be paid based on their company's performance as a percentage of the company's earnings. In other words, they'll have a stake in the company.  My country won't be prone to extreme economic cycles, and when hard times hit, the people will be protected because the rich will lose proportionally to everyone else.

 

Dont let the door knob hit you on your way out!

Congress is stupid. Consumers are stupid. George Bush is stupid. Unions are stupid. I hate America. I'm getting some investors and I'm going to buy an island, plan and design it and set up my own government. No corporation can fire based off of lost revenue so the employment rate will be almost zero. Government will require a "flex-pay" system requiring all workers to be paid based on their company's performance as a percentage of the company's earnings. In other words, they'll have a stake in the company.  My country won't be prone to extreme economic cycles, and when hard times hit, the people will be protected because the rich will lose proportionally to everyone else.

 

I knew a guy once that layed claim to a small island in the middle of a bay in Florida. He then contacted an 'internet' nation and offered to don't land on the island for their national offices. Needless to say once the state got wind of his effort to take public land (the island) his plan came to an quick end.

^Maybe it's because I'm tired but I can't make out what you're saying: "He then contacted an 'internet' nation and offered to don't land on the island for their national offices. "

^Maybe it's because I'm tired but I can't make out what you're saying: "He then contacted an 'internet' nation and offered to don't land on the island for their national offices. "

 

It sounds crazy but right. Their are people who claim to be leaders of 'nation(s)' that are purely internet based. This man contacted one of these 'nations' and offered his state owned island for their government headquarters.

 

Here is a link to something like what he contacted. It was very entertaining because I worked for the local government and we had to deal with him.

http://wirtland.agilityhoster.com/

This is hilarious. They even have a  "Miss Wirtland" contest. Look at the submissions. http://witizens.ning.com/photo/albums/miss-wirtland . I bet all of those pics are fake.

"Dont let the door knob hit you on your way out!"

 

The proper phrase is "Don't let the door hit ya where the good Lord split ya!". And with that:

 

In the spirit of The Office. . .

 

The current topic - "that's what she said."

 

As for actual information on this topic, I came here to find out because I don't know.

In the spirit of The Office. . .

 

The current topic - "that's what she said."

 

I thought the same thing. It sounds like a bad porno with terrible dialog starring Ben Bernanke or Alan Greenspan. Maybe by the same director as "Drill baby, drill" starring Sarah Palin.

^Definitely put James Kunstler in there for background commentary too and you would be set.

Fed to start buying mortgage securities in early January

 

"SAN FRANCISCO (MarketWatch) -- The Federal Reserve said late Tuesday it will begin buying mortgage securities backed by Fannie Mae, Freddie Mac, and Ginnie Mae in early January. The Fed said it "has selected private investment managers to act as its agents in implementing the program," which is "separate and distinct from the U.S. Treasury's program." The purchases will be financed through the creation of additional bank reserves, the Fed said."

http://www.marketwatch.com/News/Story/Story.aspx?guid={2FCC826E-D48B-4D18-8881-209269D2752C}

Steel Industry, in Slump, Looks to Federal Stimulus

 

"The steel industry, having entered the recession in the best of health, is emerging as a leading indicator of what lies ahead. As steel production goes — and it is now in collapse — so will go the national economy.

 

That maxim once applied to Detroit’s Big Three car companies, when they dominated American manufacturing. Now they are losing ground in good times and bad, and steel has replaced autos as the industry to watch for an early sign that a severe recession is beginning to lift.

 

The industry itself is turning to government for orders that, until the September collapse, had come from manufacturers and builders. Its executives are waiting anxiously for details of President-elect Barack Obama’s stimulus plan, and adding their voices to pleas for a huge public investment program — up to $1 trillion over two years — intended to lift demand for steel to build highways, bridges, electric power grids, schools, hospitals, water treatment plants and rapid transit."

http://www.nytimes.com/2009/01/02/business/02steel.html?_r=1&hp

^Scary Stuff