We can now say Greece has 'officially defaulted' and this will play out in a lot of ways financial. This also sets up bigger issues with Portugal, Spain, Italy, etc. The European problem is going to be around for a long time to come.

 

ISDA confirms Greece has defaulted, enacting CDS payouts

 

Debt crisis and Greek bond swap: live

"ISDA ruling means debt insurance payouts can begin, as Greek PM Lucas Papademos releases statement hailing the efforts of the Greek people to move the country away from 'quicksand'."

http://www.telegraph.co.uk/finance/debt-crisis-live/9132596/Debt-crisis-and-Greek-bond-swap-live.html

 

FITCH DOWNGRADES GREECE TO 'RESTRICTED DEFAULT' FROM 'C'

 

"Fitch Ratings-London-09 March 2012: Fitch Ratings has downgraded Greece's Long-term foreign and local currency Issuer Default Ratings (IDRs) to 'RD' ('Restricted Default') from 'C' following today's confirmation from the Greek government and eurozone officials that the exchange of Greek government bonds will proceed."

http://www.zerohedge.com/news/fitch-downgrades-greece-c-restricted-default-full-text

 

I thought Greece got a bailout last week. How they default in one week?

Well, if you decide to call whatever fits your mold a default, then the default can come whenever it is convenient to call it a default.

Solid growth for February in retail. Gas played a noticable roll and so does real inflation, but other items had decent growth as well.

 

U.S. retail sales climb 1.1% in February

Growth rates revised higher for January and December

 

"WASHINGTON (MarketWatch) — Retail sales climbed the fastest in five months in February, as rising gasoline prices weren’t enough to choke off U.S. consumers’ demand for cars, clothing and other goods, government data showed Tuesday.

 

But excluding autos as well as sales at gasoline stations, February’s sales climbed a strong but less impressive 0.6%. With average prices 20 cents a gallon higher at the pump than in January, gasoline stations were expected to have a banner month, and they did: Monthly sales jumped 3.3%, the best advance since March."

http://www.marketwatch.com/story/us-retail-sales-climb-11-in-february-2012-03-13

 

 

There will be more to come. It will not stop with Iceland and Greece.

 

Portugal Yield at 13% Says Greek Deal Not Unique: Euro Credit

 

"The good news is Greece won’t default on March 20, and 10-year borrowing costs for Spain and Italy have dropped below 5 percent. The bad news is similar- maturity Portuguese bonds still yield more than 13 percent."

 

"Unlimited European Central Bank loans to banks have halted a bond-market rout that prompted investors to drive German yields to record lows and yield premiums on the securities of its regional peers to euro-era highs. The Italian 10-year yield has dropped more than 150 basis points and the rate on similar- maturity Spanish debt is about 80 basis points lower since the ECB announced Dec. 8 it would offer loans to financial institutions through two longer-term refinancing operations.

 

“The ECB liquidity is life support,” said Robin Marshall, director of fixed income in London at Smith & Williamson Investment Management, which oversees about $18 billion. “They’ve bought time but they must use the time to implement proper reform. It’s hard to see there not being more defaults, more private sector involvement. It makes it more likely we’re going to get another market rout later in the year.”

http://www.bloomberg.com/news/2012-03-12/portugal-yield-at-13-says-greek-deal-not-unique-euro-credit.html

Well, if you decide to call whatever fits your mold a default, then the default can come whenever it is convenient to call it a default.

 

50%+ 'forced' write down of debt is a default in most books. It's like choosing chapter 13 bankruptcy over chapter 7 bankruptcy. One reduces the debt and the other eliminates it. But at the end of the day they are both bankruptcies and are a default on debt.

Quantitative easing and the investor

 

"Quantitative easing (QE) has been with us since early 2009. It has rendered many tried-and-true market indicators impotent since price/volume action in leading indices has become somewhat less reliable. Stock market timing techniques since 2009 have been more or less decimated with only the exception of this website and a couple of others, and that said, it has not been an easy environment."

 

"QE is an effective manner to manipulate the stock market higher, often on anemic volume, creating the illusion of wealth and an improving economy. And since people vote with their portfolio pocketbooks, such investors are more likely to buy stocks in such a stealth bull market environment, creating a further illusion of wealth. Meanwhile, the slow destruction of the dollar and other currencies ensues, as central banks around the world continue to print money."

http://www.marketwatch.com/story/quantitative-easing-and-the-investor-2012-03-14?dist=afterbell

 

"such investors are more likely to buy stocks in such a stealth bull market environment, creating a further illusion of wealth. Meanwhile, the slow destruction of the dollar and other currencies ensues"

 

But wouldn't it be better to put money into stocks than to keep it in cash if the PTB are destroying the value of curriencies?  In fact, wouldn't it be better to put your savings into metals, peanut butter, cars, even .... houses... ?

 

 

 

 

"such investors are more likely to buy stocks in such a stealth bull market environment, creating a further illusion of wealth. Meanwhile, the slow destruction of the dollar and other currencies ensues"

 

But wouldn't it be better to put money into stocks than to keep it in cash if the PTB are destroying the value of curriencies?  In fact, wouldn't it be better to put your savings into metals, peanut butter, cars, even .... houses... ?

 

 

 

 

I believe that one of the FEDs goal is to inflate all this debt away (the best they can). If they succeed in doing this then the stock market as well as other items may rise (dollar wise). The challenge the FEDs are facing is when does food and gas go to high on their inflation efforts and actually start cause the economy to experience more deflationary pressures in other areas (i.e. housing, car prices, demand, etc). They are walking a very delicate tightrope. Lets hope they don't fall off.

Drive until you qualify has become one of America's biggest social, environmental and economic issues.

 

How Housing Prices Burden the Economy

 

"Matthew Yglesias, the Moneybox columnist for Slate, is the author of “The Rent Is Too Damn High,” a short new electronic book. The title refers to an obscure political party in New York: The Rent Is Too Damn High Party. In the book, Mr. Yglesias argues that high rent — by which he means both rents and purchase prices — is a major drag on the American economy and society. “The real value of Yglesias’s book,” John Mangin wrote at The Washington Monthly’s Web site, “lies in its explanatory power, and in its potential to recast an important issue.”

 

High rent, Mr. Yglesias writes, is “bad for the environment; it promotes long commutes, traffic jams, misery and smog. What’s more, high rent is not a fact of nature. It’s the result of bad public policy, and it deserves to be taken seriously as one of the critical problems we face.”

 

"The national average masks enormous variation. Once bubble mania receded, we had a country that contained plenty of affordable places to live. The problem is that those places aren’t necessarily where the job opportunities are. Wages and incomes are generally highest in the big coastal metropolises where housing is scarce and prices are high. That leaves us with lots of people migrating to Sun Belt cities where wages are low and lots of newspaper stories about high-income individuals in big coastal cities who don’t “feel” rich, because the cost of living — which is driven by real estate — is so very high."

http://economix.blogs.nytimes.com/2012/03/20/how-housing-prices-burden-the-economy/

Weak PMIs underline euro-zone recession fears

 

"FRANKFURT (MarketWatch)—Weaker-than-expected purchasing managers' index readings from France and Germany on Thursday pointed to an accelerated contraction in private-sector activity across the euro zone, highlighting fears the region slipped into and remains in a recession.

 

The Markit composite purchasing managers' index, or PMI, fell to a three-month low of 48.7 from 49.3 in February. The services index edged down to 48.7 from 48.78 in February, while manufacturing PMI fell to 47.7 from 49.0. A reading of less than 50 indicates a contraction in activity."

http://www.marketwatch.com/story/weak-pmis-underline-euro-zone-recession-fears-2012-03-22

 

China factories slumping amid low demand

 

"HONG KONG (MarketWatch) — Chinese factory activity is slowing sharply, dragging on employment amid a deepening slowdown in global demand and aggravated by a stall in domestic consumption, according to March survey data showing new orders at a four-month low."

http://www.marketwatch.com/story/china-factories-slumping-amid-low-demand-2012-03-22

 

SocGen: “Sharp” Gold Rally As US GDP Surprises “Dramatically” to Downside

 

"Gold will have a “sharp” rally as the U.S. boosts monetary stimulus because of a faltering economy in the coming months, Societe Generale said in a report that was picked up by Bloomberg.

 

Data on U.S. gross domestic product in the first and second quarters will “surprise dramatically to the downside,” the bank said today in a report."

http://www.zerohedge.com/news/socgen-%E2%80%9Csharp%E2%80%9D-gold-rally-us-gdp-surprises-%E2%80%9Cdramatically%E2%80%9D-downside

 

U.S. jobless claims fall 5,000 to 348,000

Applications for benefits at lowest level since February 2008

 

"WASHINGTON (MarketWatch) — Applications for weekly unemployment benefits set a new four-year low, the government reported Thursday, in another sign that the U.S. labor market continues to gradually improve."

 

"Initial claims fell by 5,000 to a seasonally adjusted 348,000, the lowest level since February 2008, the Labor Department said.

Claims from the prior week were revised up to 353,000 from an original reading of 351,000."

http://www.marketwatch.com/story/us-jobless-claims-fall-5000-to-348000-2012-03-22

FedEx waves a yellow flag

Commentary: Weaker outlook gives the bulls something to chew on

 

"The Cliff Notes version of FedEx’s comments is that Europe, already a mess, is headed into recession. This is not surprising, given the toll Greece’s debt crisis took on the region. Just imagine Spain or Italy falling down the same drain, as some economists fear they might, and the strain that would put on their neighbors.

 

As for China, the latest data point to a further cooling of the world’s hottest economy.

 

Finally, there is fuel. Soaring fuel prices for a company totally dependent on trucks and planes can kill the bottom line. And there are plenty of reasons (Iran, for one) to believe oil prices have yet to peak.

 

None of this is good for FedEx. But it’s especially unnerving when FedEx, a bellwether stock sensitive to every little blip in parcel volumes worldwide, tells Wall Street analysts they’re being overly optimistic about 2012."

http://www.marketwatch.com/story/fedex-waves-a-yellow-flag-2012-03-22?dist=afterbell

Ben and the Muppets’ European adventure

Commentary: Few warnings get taken seriously in a bull market

 

"Yet his warnings on Wednesday that Europe’s crisis isn’t over went largely unheeded in the markets, almost to the point of being ignored. It can’t be that investors doubt his pedigree, like Smith. So it must be that the collapse of the euro is so widely expected that Bernanke’s comments are blindingly obvious.

 

The problem is that, like with Smith’s greed claims, nobody wants to hear it, especially when markets are rising. This is how history bumps us along from crisis to crisis, never really fixing anything when there is time and then rushing for the exits when the crisis finally erupts. The Glass-Steagall Act, which separated banks and investment banks in the early 1930s, only to be repealed in 1999 and setting up the latest financial crisis a decade later, was an exception. No such weighty regulation will arise this time."

 

"Bernanke and Treasury Secretary Tim Geithner’s warnings that European banks and sovereign debtors need to continue dramatic action to solve the debt problem shows that most people won’t listen to the folks at the top of the heap either. Not if the message is one they don’t want to hear."

http://www.marketwatch.com/story/ben-and-the-muppets-european-adventure-2012-03-22

Of course Case Shiller data is not showing this and their data has seemed to be more accurate over the last several years.

 

So prices go up and less people buy. Does that sound like a rebound? Plus last months numbers were adjusted downward noticably. Same story over and over, get the most out of the original headline then print the revision down the road when everyone is focused on the next original headline.

 

Sales of new homes dip 1.6%, while prices jump

 

"Sales of new homes fell 1.6% to a seasonally adjusted annual rate of 313,000 from a downwardly revised 318,000 in January."

 

"Median sales prices, which are not seasonally adjusted, jumped 8.3% to $233,700, which is the biggest one-month percentage rise in 14 months. That’s the highest level since June.

 

Compared with February 2011, median prices climbed 6%.

 

The price difference between a new and an existing home widened to $77,100 in February from $61,100 in January."

http://www.marketwatch.com/story/sales-of-new-homes-dip-16-while-prices-jump-2012-03-23?dist=countdown

Case-Shiller: Home prices fall in January

Index records fifth straight decline; prices lowest in nine years

 

"WASHINGTON (MarketWatch) — U.S. home prices fell for the fifth month in a row in January to the lowest level since early 2003, according to a closely followed index.

 

The S&P/Case-Shiller 20-city composite index dropped 0.8% in the first month of 2012. The three-month rolling index includes transactions that took place from November to January.

 

“Despite some positive economic signs, home prices continued to drop,” said David M. Blitzer, chairman of the index committee at S&P Indices.

 

Over the past 12 months, prices have fallen 3.8% even though the U.S. economy has shown increasing signs of recovery. Sixteen of the 20 metropolitan areas posted declines, while only Miami, Phoenix and Washington, D.C., saw increases."

http://www.marketwatch.com/story/case-shiller-home-prices-fall-in-january-2012-03-27

These economic downward vortexes get very hard to escape and more budget cuts will only add to the speed of the decline for the forseeable future.

 

Spain to slash spending as economy slumps back into recession

Spain’s fragile economy has fallen back into recession and the country faces a year of grinding economic decline as premier Mariano Rajoy slashes spending yet further to meet EU demands.

 

"The Bank of Spain said the “contractionary dynamic” in the economy continued into early 2012 for the second quarter in a row, with an “intensifying” pace of job losses. It expects GDP to fall by 1.5pc this year.

 

It is unclear how he can slash the budget deficit from 8.5pc of GDP last year to 5.3pc to meet the compromise target agreed with Brussels after a bruising confrontation."

 

“It is frankly impossible, given that it would aggravate the recession and this would crush state revenues,” said Jesús Fernández-Villaverde from the University of Pennsylvania."

 

"Fresh data from Spain’s treasury showed the deficit for January and February was worse than for the same period last year, even stripping out “one-off” costs stemming from excesses by the regional juntas."

http://www.telegraph.co.uk/finance/financialcrisis/9170309/Spain-to-slash-spending-as-economy-slumps-back-into-recession.html

While the numbers missed their projections at least most areas are up. Probably the biggest down part of this report is that actual shipments of goods fell again and inventories continue to rise. If those two trends continue there will be a pull back in the not to distant future. Year over year the numbers look much better.

 

Durable-goods orders up 2.2% in February

Airplanes, defense lead way as demand shows broad strength

 

"Economists surveyed by MarketWatch had expected durable-goods orders to increase a seasonally adjusted 2.9% on the month, snapping back from a sharp drop in January. It was the fourth increase in five months.

 

Shipments of all durable goods, meanwhile, fell 0.4% in February. Inventories of such goods rose 0.4% last month, however."

http://www.marketwatch.com/story/durable-goods-orders-up-22-in-february-2012-03-28

So we have, UK, Spain, Portugal, Greece, Italy, France (and other EU members) all now in recessions, with Germany and Japan on the edge. This will/is impacting the US. Look for QE3 some time this year in an effort to kick the can down the road a little farther.

 

UK is back in recession, says OECD

"Britain has plunged back into a recession, as the economy continued to shrink in the first three months of the year, according to a leading global authority."

http://www.telegraph.co.uk/finance/economics/9173199/UK-is-back-in-recession-says-OECD.html

 

General strike hits Spain - in pictures

http://www.telegraph.co.uk/finance/financialcrisis/9173687/General-strike-hits-Spain-in-pictures.html

 

France enters recession

"France is in recession according to the official INSEE statistics agency but it said that it will be short and shallow.

 

INSEE sees the economy contracting in the final three months of this year by 0.2 percent and believes it will shrink by a further 0.1 percent in the first quarter of 2012."

http://www.euronews.com/2011/12/16/france-enters-recession

 

Italy Officially Enters Recession

"Italy's economy entered recession for the first time since 2009 after registering two consecutive quarters of decline in GDP, final data from the statistical office Istat showed Monday."

http://www.turkishweekly.net/news/132381/italy-officially-enters-recession.html

I suspect there will be great bargains at French, Spanish and Italian retailers!  :clap:

I suspect there will be great bargains at French, Spanish and Italian retailers!  :clap:

 

It will all depend on the value of the dollar vs the Euro.

How long can they keep this game going? The demand for US debt from the private sector and foreigners has basically dropped off the cliff. Sooner or later the FEDs will not be able to continue to be the majority buyer of our debt. When this happens interest rates will rise significantly and housing prices and sales will begin another leg down and I think we have all learned what that means for the economy.

 

Demand for U.S. Debt Is Not Limitless

In 2011, the Fed purchased a stunning 61% of Treasury issuance. That can't last..

 

"The conventional wisdom that nearly infinite demand exists for U.S. Treasury debt is flawed and especially dangerous at a time of record U.S. sovereign debt issuance.

 

The recently released Federal Reserve Flow of Funds report for all of 2011 reveals that Federal Reserve purchases of Treasury debt mask reduced demand for U.S. sovereign obligations. Last year the Fed purchased a stunning 61% of the total net Treasury issuance, up from negligible amounts prior to the 2008 financial crisis. This not only creates the false appearance of limitless demand for U.S. debt but also blunts any sense of urgency to reduce supersized budget deficits."

http://online.wsj.com/article/SB10001424052702304450004577279754275393064.html?mod=googlenews_wsj

I suspect there will be great bargains at French, Spanish and Italian retailers!  :clap:

 

It will all depend on the value of the dollar vs the Euro.

It wont matter, i'm going to buy anyway!  LOL

I hope you take the time to watch this 8 minute video from the Daily Show.

 

Several times in the last year there has been discussion on this thread about bailouts for banks/wall street and how much was given, how much was paid back and who profited. I think this 8 minute clip on The Daily Show helps clarify that TARP was a very small amount of money that was given to the banks. I wonder how many programs are still happening with very little discussion in the MSM. We did find out about a week ago that the US Feds are starting to take on Euro debt even after the public was told that we would not participate in the Euroland bailout.

 

America's Next TARP Model

"A Bloomberg report reveals that the U.S. government loaned banks $7.7 trillion in secret bailout funds at no interest and then borrowed the money back at interest."

 

http://www.thedailyshow.com/watch/thu-december-1-2011/america-s-next-tarp-model

Stock futures, dollar sink after jobs data

Most markets closed Friday; job growth below expectations

 

"NEW YORK (MarketWatch) — U.S. stock futures and the dollar slumped Friday, while Treasury prices surged after government data delivered an unwelcome surprise on a day when most markets were closed: Only 120,000 jobs were created in March, well below market expectations.

 

Equity futures had been slightly higher, but turned sharply lower after the Labor Department report — the first time since November that job growth dropped below the 200,000 level. Economists surveyed by MarketWatch expected a rise of 210,000."

http://www.marketwatch.com/story/stock-futures-dollar-sink-after-jobs-data-2012-04-06

 

What is probably more telling on job growth in the US is not these monthly job growth numbers. Its the Labor Participation Rate (people that are working). So what is this data saying, that the amount of people in America that are working continues to decline.

 

Labor Force Statistics from the Current Population Survey

 

http://data.bls.gov/timeseries/LNS11300000

 

The boomer population reaching retirement age certainly factors in...both my parents fit that description

I've got the feeling that the Boomers aren't going to retire until their folks pass away, their house is auctioned off and the inheritances clear probate.

The boomer population reaching retirement age certainly factors in...both my parents fit that description

 

Acutally the Y Generation that should be entering the job market at this time and in the future is larger than the baby boomers (so we really should not be seeing a drop in the labor force numbers). Add in all the evidence that the Boomers are not retiring at the rate expected and you have a noticable issue with a decline in the Labor Force.

Insider information on Goverment data is being used by those in the 'know' to make a profit?  :-o

 

Bets on ZROZ, employment data smack of Wall Street inside job

 

"If you had known about the numbers that the Bureau of Labor Statistics was releasing Friday about employment, and wanted to bet on your information, there would have been no better place to turn than the PIMCO 25+ Year Zero-Coupon U.S. Treasury Index fund (ZROZ) the longest-duration Treasury ETF out there."

 

"Apparently, somebody or several somebodies made that bet.

 

The ZROZ traded 831,000 shares on Thursday, or roughly 25 times its average daily-trading volume. The fund only had moved more than 25,000 shares six times since the start of March, and never close to Thursday’s activity.

 

“With that much trading volume, nothing makes sense besides someone having inside information about what [the Bureau of Labor Statistics] was going to say,” said Michael S. Falk of Focus Consulting Group in Chicago. “If you had wanted to make that bet and it was not inside information given to you at the last minute, you would have averaged into it to avoid disrupting the bid-ask spread. … While you could make the same bet in the options market, it is more likely for the authorities to look for it or find it there.”

 

"Added Falk: “With a bet of that size made a day before a news announcement, it certainly gives the feel that the system is being rigged and gerrymandered. The only reason it doesn’t panic the market is that the average person — and probably the average regulator — doesn’t even know that stuff like this is going on.”

http://blogs.marketwatch.com/thetell/2012/04/06/bets-on-zroz-employment-data-smack-of-wall-street-inside-job/

Sounds like Clarence Beaks is still working for Randolph and Mortimer Duke.

Clarence Beaks of Lyndhurst Security?  Be careful what you post.... he might rip your eyes out and piss on your brain!

Clarence Beaks of Lyndhurst Security?  Be careful what you post.... he might rip your eyes out and piss on your brain!

 

He only says that to drunk railroad workers. And I quit drinking a decade ago.

 

Nice catch, BTW.

"Added Falk: “With a bet of that size made a day before a news announcement, it certainly gives the feel that the system is being rigged and gerrymandered. The only reason it doesn’t panic the market is that the average person — and probably the average regulator — doesn’t even know that stuff like this is going on.”

 

Indeed. I've studied PIMCO a bit, yet had never heard of ZROZ despite the fact that its catchy acronym makes it sound like The Boz's Soviet nemesis. It's not exactly an edgy security.

This chart helps show that the unemployment rate number is no longer connected to the actual amount of people employed. Both of these numbers historically have been closely connected until now. This helps show what is really happening, people are just falling off the unemployment roles (no longer counted) but it isn't because they are finding a job.

 

This feels a lot like 2008 (doesn't matter which party is in the White House). Wall Street was near these same levels, the FED was telling us there was no housing bubble bust, things are just fine, no recession, nothing wrong with the banks, blah, blah, blah. I guess Americans have short term memories. Of course as soon as the election was over we find out that housing was a bust, we had been in a recession for almost a year and Wall Street was really starting to come undone. Will we repeat these types of events again or will it be different this time?

 

We found all of that out before the election was over.

 

This helps show what is really happening, people are just falling off the unemployment roles (no longer counted) but it isn't because they are finding a job.

 

Does this account for those people working "under the table" who may or may not be recieving unemployment comp on top?  How about those who have been switched from unemployment comp to some other form of assistance like disability?

 

BTW, like most things in a society of 300 million+, it is a bit more complicated than what is being bantered about.  For those interested in an objective explanation of these varying statistics without the spin, check this out - http://www.factcheck.org/2012/02/whats-the-real-jobless-rate/.  The interesting note about the chart in that link is that, no matter which of the four methods of calculation you use, the trend remains the same.  It looks like the peak occured in late 2009 and has been slowly moving downward ever since.

 

I also will point out that, technically, if you work 39 hours a week, you are part-time and counted towards the U-6 calculation people (for whatever reason) gleefully rave about like they just got straight A's on their report card.

Serious question: Since i work 80 hrs a week on two jobs, can i count as double employed?

We found all of that out before the election was over.

 

This helps show what is really happening, people are just falling off the unemployment roles (no longer counted) but it isn't because they are finding a job.

 

Does this account for those people working "under the table" who may or may not be recieving unemployment comp on top?  How about those who have been switched from unemployment comp to some other form of assistance like disability?

 

BTW, like most things in a society of 300 million+, it is a bit more complicated than what is being bantered about.  For those interested in an objective explanation of these varying statistics without the spin, check this out - http://www.factcheck.org/2012/02/whats-the-real-jobless-rate/.  The interesting note about the chart in that link is that, no matter which of the four methods of calculation you use, the trend remains the same.  It looks like the peak occured in late 2009 and has been slowly moving downward ever since.

 

I also will point out that, technically, if you work 39 hours a week, you are part-time and counted towards the U-6 calculation people (for whatever reason) gleefully rave about like they just got straight A's on their report card.

 

Thank for your input and your link. Also nice to see more information.

 

As far as the comment 'we found all of that out before the elections' is incorrect.

 

December 1, 2008 (about 30 days after the election)

"NEW YORK (CNNMoney.com) -- The National Bureau of Economic Research said Monday that the U.S. has been in a recession since December 2007."

http://money.cnn.com/2008/12/01/news/economy/recession/index.htm

 

The FED didn't announce the purchase of mortgage securities backed by Fannie Mae, Freddie Mac, and Ginnie Mae until December 30, 2008. After the elections. This also was the first real moment when the FED showed how desperate the situation on housing and the remaining banks was.

 

The FED continued to dismiss the bank failures up to the late summer/early fall of 2008 (about 60 days before the elections). Housing cheerleaders were still calling for a soft landing during this time frame as well.

 

 

Quote from Hts121

"Does this account for those people working "under the table" who may or may not be recieving unemployment comp on top?  How about those who have been switched from unemployment comp to some other form of assistance like disability?"

 

Are you suggesting that these items are new to the system and/or are now being done to such a greater amount that they actually affect the data in a way never before seen?

 

It ashame the original Recession/housing bust thread is still not available. (I know it was huge and the cleaning of the thread that needed to be done was to much.) But, it would be an easy read of all the 'happy talk' society was feed going into the fall of 2008 before the elections.

 

As far as your comments about your link as an objective site, maybe or maybe not. One of the main supports of that site Annenberg, actually had Obama on its Chicago Annenberg Chellenge Board of Directors. I would ask that we try not to lable links as objective or unobjective just because of a personal or political view point. I have tried not to turn this into a political discussion and have worked to post most of my stuff from MSM sites.

I work in the Denver metro area and can tell you that the builders are showing some renewed confidence in housing starts. The price points and products types are much different (overall) than they where during the boom (smaller homes, smaller lots, lower prices and a lot of multifamily making up a bulk of the new growth). Of course the Denver metro area has had the largest growth in construction jobs over all the other metros. So we are probably seeing the top end of the growth with most other metros at lower rates. But, its clear there is some renewed interest in housing (from the builders and buyers). Is it the start of a long term turnaround or something less substantial. Time will tell. We have been at this downturn for half a decade now, hopefully a bottom is finally being established to build from.

 

Pulse, Lennar jump as survey shows housing rebound

 

"NEW YORK (MarketWatch) — Shares of U.S. homebuilders rallied on Wednesday after a Wells Fargo analyst’s research report said data from 20 select markets nationwide are showing strength across the board.

 

“For the third consecutive month, our survey points to an improvement in orders suggesting 2012 may be the long-awaited recovery year for housing,” the note said."

http://www.urbanohio.com/forum2/index.php?action=post;topic=17905.3540;last_msg=613201

As far as your comments about your link as an objective site, maybe or maybe not. One of the main supports of that site Annenberg, actually had Obama on its Chicago Annenberg Chellenge Board of Directors. I would ask that we try not to lable links as objective or unobjective just because of a personal or political view point. I have tried not to turn this into a political discussion and have worked to post most of my stuff from MSM sites.

 

My apologies.  I did not know there was some loose connection to Obama in the past.  I suppose you're right in that it can not, for that reason, be considered objective.  Was Bill Ayers on the Board as well?

 

As far as your objectiveness, I would use a thicker veil if you want to pass that off.  You're very informative, but your overall sales pitch is clear.

 

And your constant reference to zerohedge kind of belies your last point, no?

 

Lastly, I realize this is where you claim your expertise, but don't get so offended when you are challenged on some of the arguments you make.  This is a very debatable topic.  Experts and academics go back and forth on these very topics all of the time.  I only jump in when I think something is being misrepresented.  You can feel free to respond if you think I'm wrong.  But it's not your thread.  The ground rules are what they are.

As far as your comments about your link as an objective site, maybe or maybe not. One of the main supports of that site Annenberg, actually had Obama on its Chicago Annenberg Chellenge Board of Directors. I would ask that we try not to lable links as objective or unobjective just because of a personal or political view point. I have tried not to turn this into a political discussion and have worked to post most of my stuff from MSM sites.

 

My apologies.  I did not know there was some loose connection to Obama in the past.  I suppose you're right in that it can not, for that reason, be considered objective.  Was Bill Ayers on the Board as well?

 

As far as your objectiveness, I would use a thicker veil if you want to pass that off.  You're very informative, but your overall sales pitch is clear.

 

And your constant reference to zerohedge kind of belies your last point, no?

 

Lastly, I realize this is where you claim your expertise, but don't get so offended when you are challenged on some of the arguments you make.  This is a very debatable topic.  Experts and academics go back and forth on these very topics all of the time.  I only jump in when I think something is being misrepresented.  You can feel free to respond if you think I'm wrong.  But it's not your thread.  The ground rules are what they are.

 

I think you miss read my comment. Not offended at all. Just not wanting this to turn into a political discussion. I personally think both parties do what the FED and Wall Street wants (and I think they both have shown that very clearly by now).

 

With my post that come from zerohedge. I try to only use the data and charts that are provided there, I don't agree with many of their points of view and spin. But they do provide some charts and data points that are helpful in an economic discussion.

Fair enough.  Play on.

This is a strange time of the year for this data point to drop, right as we enter the spring selling season. I know that a lot of builders are constructing a lot of new homes in hopes of a good selling season. One observation that I noticed just last week, a lot of these new homes have available signs on them. Let hope things pick up in May/June/July before the core of the selling season ends.

 

On another note. It appears that the builders that are producing products that cater to the Y generation and boomers (smaller homes, single story, smaller lots, lower prices points, closer to amenities, mixed use) seem to be doing OK. The builders that are constructing the large two story models on large suburban lots and acting like its the 90s and early 2000 all over again are having some issues.

 

Builder sentiment drops in April; first fall in 7

 

"WASHINGTON (MarketWatch) — Home-builder sentiment dropped in April for the first time in seven months, as growing traffic at new-build sites hasn’t yet led to sales."

http://www.marketwatch.com/story/builder-sentiment-drops-in-april-first-fall-in-7-2012-04-16

 

N.Y. manufacturing gauge slows markedly in April

 

"WASHINGTON (MarketWatch) — A reading of New York–area manufacturing conditions pointed to a significant slowdown in April, as purchasing managers reported slowing shipment growth and falling unfilled orders."

http://www.marketwatch.com/story/ny-manufacturing-gauge-slows-markedly-in-april-2012-04-16?link=MW_story_insert

Home building slows, but March permits up

New construction could accelerate in months ahead

 

"WASHINGTON (MarketWatch) — U.S. builders started work on new homes in March at a sharply slower pace, but the number of construction permits jumped to their highest level in 3 1/2 years in a positive signal for the slump-ridden industry.

 

The Commerce Department reported that housing starts fell 5.8% to an annual rate of 654,000 last month, well below the MarketWatch forecast of economists projecting an increase to 703,000. The data are seasonally adjusted.

 

Housing starts in February were also revised down slightly, to 694,000 from 698,000."

http://www.marketwatch.com/story/home-building-slows-but-march-permits-surge-2012-04-17

 

 

I've said this before in this thread, but given that it's 119 pages and the topic has come up many times since the last time I made the point, it may bear repetition: Far, far too much attention and emphasis is given to the housing market as a marker of the health of the overall economy.  I actually think a permanently weaker housing market (as a result of more accurate public perceptions of the <a href="http://www.fool.com/investing/general/2011/12/23/robert-shiller-on-why-home-prices-could-fall-for-s.aspx">real return on investment in residential real estate over time</a> and a collective reassessment of the <a href="http://caps.fool.com/Blogs/buying-a-house-is-the-worst/714396">pros and cons of homeownership</a>) would be a very positive development for the country.

 

In the abstract, there are reasons to buy a house.  Mortgage payments (assuming fixed-rate term mortgages) don't go up; rent does.  And many good neighborhoods that one might want to move into (for the school district, for example) have few rental options available, especially at 3 beds and up, if you have a family.  However, the fact that there are some pros does not mean that homes are worth anything near what they're currently selling for, even after a decline from a historical peak to a historical average.  We're still nowhere near a historical trough.  I'd be content seeing us decline to a historical trough and then break through it, i.e., to a new threshold of affordability.

Home ownership equals neighborhood stability. Think of a business owner who owns the vast majority of his business compared to an owner who has relatively few shares and a  crazy salary. The second guy has no real personal stake in the company, and may make decisions at the company's expense to his benefit. Whereas the first guy has to be loyal,  has to make decisions that are best for the company,  else he's f-d.

 

Nothing good comes from foreclosed neighborhoods and uncaring renters. Homeownership helps remedy that.

 

Think of the business owner who owns a vast majority of his business?  That's hardly as stability-inducing (or growth-inducing) as you're suggesting.  Controlling shareholders have just as much ability to do mischief as executives--to think short-term instead of long-term.  Indeed, part of Mitt Romney's former employer's strategy was to acquire controlling interests in companies for precisely that purpose.  A manager who has some stake in his business is a good thing, but you can say that for employees, too.

 

Nothing good comes from "foreclosed neighborhoods?"  Well, that's true (putting aside the ambiguity in what's a "foreclosed neighborhood"), but how does that help your argument?  One of the reasons we have such significant foreclosures now is because of the cult of homeownership that encouraged people who were not financially ready (or ready for other responsibilities of homeownership) to buy homes at inflated prices.  After all, it's owners, not renters, who get foreclosed upon.  One's landlord may lose the property, of course, but that's rare in a property that's actually rented out.  And, of course, if the renter really likes it that much, he can buy it at the foreclosure auction at 2/3 of appraised value (and sheriff's appraisals are often fairly realistic, unlike those commissioned by realtors, or the auditor, who want high sales prices and high tax valuations).

I've said this before in this thread, but given that it's 119 pages and the topic has come up many times since the last time I made the point, it may bear repetition: Far, far too much attention and emphasis is given to the housing market as a marker of the health of the overall economy.  I actually think a permanently weaker housing market (as a result of more accurate public perceptions of the <a href="http://www.fool.com/investing/general/2011/12/23/robert-shiller-on-why-home-prices-could-fall-for-s.aspx">real return on investment in residential real estate over time</a> and a collective reassessment of the <a href="http://caps.fool.com/Blogs/buying-a-house-is-the-worst/714396">pros and cons of homeownership</a>) would be a very positive development for the country.

 

 

That's a big 10-4.

Philly Fed manufacturing index falls in April

Economic Report

Companies in region still expanding but at slower pace; hiring is up

 

"WASHINGTON (MarketWatch) — A closely followed report that measures the health of U.S. manufacturers fell for the first time in six months, the Philadelphia Federal Reserve said Thursday.

 

The bank’s index of business conditions in the Philadelphia region dropped to 8.5 in April from 12.5 in March. That was below the consensus of economists polled by MarketWatch, who expected the index to slip to 10.8."

http://articles.marketwatch.com/2012-04-19/economy/31365571_1_manufacturing-index-index-for-new-orders-jobless-claims

 

U.S. existing home sales fall 2.6 pct in March

 

"(Reuters) - U.S. home resales fell in March but the supply of properties on the market tightened and prices inched higher, giving mixed signals about the pace of recovery in the still-struggling housing sector."

http://www.reuters.com/article/2012/04/19/usa-economy-housing-idUSL2E8FIMW620120419

Here is a shock, the EU recession is lasting longer then the 'economist's' projected.

Manufacturing and services activity highlights eurozone's struggle

"Eurozone services and manufacturing output contracted more than expected in April, as the economy struggled to rebound from a fourth-quarter contraction, and powerhouse Germany saw manufacturing output fall close to a three-year low."

 

"April's PMI for the eurozone's dominant service sector slipped further below the 50 threshold that divides growth from contraction in April, falling to 47.9 from 49.2 in March."

 

"We were saying last month that we probably had a second consecutive quarter of decline (in business activity), making a recession - now that's extending into a third quarter," said Chris Williamson, chief economist at PMI compiler Markit."

http://www.telegraph.co.uk/finance/financialcrisis/9220628/Manufacturing-and-services-activity-highlights-eurozones-struggle.html

 

 

China manufacturing shrinks at slower pace: HSBC

"Initial PMI reading of 49.1 still marks contraction"

http://www.marketwatch.com/story/china-manufacturing-shrinks-at-slower-pace-hsbc-2012-04-22

 

 

Whoever thought Spain had left a recession was on something. Their unemployment rate is depressionary (20+ percent).

"Markets tumble on political uncertainty in France and the Netherlands, a raft of weak economic data from the eurozone and news that Spain is back in recession."

http://www.telegraph.co.uk/finance/debt-crisis-live/9220235/Debt-crisis-live.html

 

 

This should help boost current and future home sales. Good thing we have college loan deferment programs.

1 in 2 new graduates are jobless or underemployed

Note to Class of 2012: More than half of young college graduates now jobless or underemployed

 

"WASHINGTON (AP) -- The college class of 2012 is in for a rude welcome to the world of work.

 

A weak labor market already has left half of young college graduates either jobless or underemployed in positions that don't fully use their skills and knowledge.

 

Young adults with bachelor's degrees are increasingly scraping by in lower-wage jobs — waiter or waitress, bartender, retail clerk or receptionist, for example — and that's confounding their hopes a degree would pay off despite higher tuition and mounting student loans."

http://finance.yahoo.com/news/1-2-graduates-jobless-underemployed-140300863.html?l=1

 

This story on housing is far from over. This next wave will put more pressure on the housing market and economy and should start hitting the markets in the Spring of 2013. How long this next downturn last will depend on how fast or slow the banks move on selling this shadow inventory.

 

U.S. home prices fall to nearly decade low

February prices down 0.8% on the month

 

"WASHINGTON (MarketWatch) — U.S. home prices dropped sharply in February to hit the worst level in nearly a decade, according to a closely followed index released Tuesday.

 

The S&P/Case-Shiller 20-city composite fell 0.8% compared to January levels to take the year-on-year drop to 3.5%. The index is at its lowest level since October 2002. Of the 20 cities measured, 16 had negative readings and only three showed gains."

http://www.marketwatch.com/story/us-home-prices-fall-to-nearly-decade-low-2012-04-24

 

Foreclosure Crisis: Halftime

Three hidden costs of the foreclosure crisis

The country’s foreclosure problem is only halfway over: CRL

http://www.marketwatch.com/story/three-hidden-costs-of-the-foreclosure-crisis-2012-04-24

 

I think this spring and summer is going to be the best we have seen in housing in many years. Look for prices to go up some and sales to increase. After the election and next year not so sure.

 

Sales of new homes drop 7.1% in March

Purchases in U.S. in February revised sharply higher

 

"WASHINGTON (MarketWatch) — Sales of new U.S. houses fell 7.1% in March, but only because purchases in February were revised sharply higher, according to government data released Tuesday."

http://www.marketwatch.com/story/sales-of-new-homes-drop-71-in-march-2012-04-24?link=MW_story_insert

So we have been at this for half a decade now and have spent an untold amount of money and tried all kinds of 'unique' approaches to juice the system. But we are still not move forward with any real momentum. What is next and how many more bullets do they really have?

 

Fed struggles to spur slowest recovery in memory

 

"They’ve tried dumping $2 trillion in cash into the financial system, slashed overnight interest rates to zero and made an unprecedented promise to keep rates low for at least another two years."

 

"After each recession since World War II, housing has helped lead the subsequent recovery. But five years into the biggest housing bust since the Great Depression, another hoped-for spring revival in home sales is in doubt.

 

Following signs earlier this year that the market may have hit bottom, the National Association of Realtors said last week that sales of previously owned homes fell 2.6 percent last month to a seasonally adjusted annual rate of 4.5 million. That's well below the pace of about 6 million typically seen in a healthy economy."

http://economywatch.msnbc.msn.com/_news/2012/04/24/11357191-fed-struggles-to-spur-slowest-recovery-in-memory?lite