Posted on 04/03/2009 6:06:47 AM PDT by jmaroneps37
Watching the flow of financial news has become like watching a magic show at the circus. In the center ring we see an impressive daily slight of hand trick. It turns our attention from the truth to only what Obama wants us to see. Although this changes regularly it never focuses on hard data.
The schizophrenic Democrats can’t decide if they hate Wall Street ( while they are beating it up for their own purposes) or they love Wall Street - when the Dow goes up. Lately the Dow has been going up and of course the media and the Democrats are all bragging about its progress. Headlines giddily screamed, “Dow Jumps on Good news!” The truth these clowns are hiding is ugly and frightening.
The mortgage default rate is at record high levels.
The number of “seriously delinquent” FHA mortgages is up 1.5% in February year to year comparison.
FHA –insured mortgages (taxpayer paid for) for fourth quarter of 2008 were at 30% compared to only 2% in all of 2006! This is the largest jump in defaults EVER and doubles last year’s rate.
Don’t believe the slight up tick in new home sales means anything – it doesn’t.
The Commercial real estate market is still worse. Choice big city commercial asking rates are down 19% and the market is still sagging. The commercial vacancy rate has soared to 11.3% near double last year’s level.
When no new businesses are opening; no new employment opportunities are developed.
The employment picture is very discouraging.
Janet Yellen of the San Francisco Fed, recently said she predicts unemployment will grow straight through 2009 and on into 2010.
The socialists’ huge spending sprees will choke the life out of our country. This is a time to step up and fight. We have to…
(Excerpt) Read more at collinsreport.net ...
How long to you think the dead cat bounce will last?
ping
The economy will not rebound so along as there is a socialist in the White House and socialists controlling Congress.
THE EMPLOYMENT SITUATION: MARCH 2009
Nonfarm payroll employment continued to decline sharply in March (-663,000), and the unemployment rate rose from 8.1 to 8.5 percent, the Bureau of Labor Statistics of the U.S. Department of Labor reported today. Since the recession began in December 2007, 5.1 million jobs have been lost, with almost two-thirds (3.3 million) of the decrease occurring in the last 5 months. In March, job losses were large and widespread across the major industry sectors.
Unemployment (Household Survey Data)
In March, the number of unemployed persons increased by 694,000 to 13.2 million, and the unemployment rate rose to 8.5 percent. Over the past 12 months, the number of unemployed persons has grown by about 5.3 million, and the unemployment rate has risen by 3.4 percentage points. Half of the increase in both the number of unemployed and the unemployment rate occurred in the last 4 months.
(See table A-1.)
The unemployment rates continued to trend upward in March for adult men (8.8 percent), adult women (7.0 percent), whites (7.9 percent), and Hispanics (11.4
percent). The jobless rates for blacks (13.3 percent) and teenagers (21.7 percent) were little changed over the month. The unemployment rate for Asians was
6.4 percent in March, not seasonally adjusted, up from 3.6 percent a year earlier. (See tables A-1, A-2, and A-3.)
There's a line of thought that says "late summer/early fall".
The employment numbers just came out and it does not look good. Also, we have yet to see a big impact due to commercial real estate. The current bounce, IMHO, is nothing more than a temp thing. I look for much more downside on the DOW and NASDAQ....
The next leg down in this death spiral is the commercial balloons and the ARM resets.
Look for very bad news in late 2009 & 2010.
We are in a lull for resets and the next wave is bigger.
Even though we know that adjustable rate mortgages were a major cause of the financial crisis, the storm has not passed.
Just because the problem is obvious, doesn’t mean it is not a problem.
The chart from T2 Partners produced about one year ago shows that we are now in a lull for adjustable rate mortgage resets.
There will be another crescendo of resets in 2010 and 2011. When banks ask for more taxpayer money to sure up their balance sheets in 2010, Timmy Geithner will be wearing his best “shoulda guessed” face when he gets the call from Citicorp.
Commercial, non-residential real estate and construction loans total 40 percent of bank loan portfolios.
These loans will provide the next leg down in this death spiral.
Anyone who can’t see this coming is just not looking.
The Escalator of Life is Going Down
http://seekingalpha.com/article/126971-the-escalator-of-life-is-going-down-part-1
I am leary of these sudden bounces after a dramatic fall. In the past it has been a means for getting the rest of the assets they didn’t get the first time as people jump back in. JMHO.
663K jobs lost in March.
That’s more than the population of Baltimore.
If economists are right, it would mark a record four straight months that job losses topped 600,000.
Obama’s hope n change on full display.
The MSM has assiduously avoided reporting on the weakness is commercial real estate. OTOH, it's been discussed a lot on FR.
It's the next shoe to drop...
The market has mystified me as of late.
The gubmint says we reserve the right to take you pay and tell companys what to do and the market goes up?
I have been saying for months, its like a game of 3 card monte.
Then I suppose the death spiral will just simply be another opportunity for Barack and Company to declare another “crisis” and take the opportunity to spend some more “stimulus” and grow some more socialism.
From the intra-day low on March 10, to yesterday’s intra-day high, the Dow has jumped 26.2%. Quite a move in 3 short weeks!
Seems to me traders still think this is 2006 and we will be back to records in no time.
Very dangerous.
BTW, how is the auctioning of those bad assets that the banks hold going?
I bet they have buyers standing in line, right? /s
By taxing TRILLIONS of dollars they have taken the money out of our pockets and instead of us giving to charity they will decide who the politically correct charities are to be given to.
Instead of letting housing prices fall they want to prop up the fake values and "invest" in them.
Instead of letting the overpriced GM/Ford/etc... auto market succeed or fail by lowering prices they have NOT let the capitalist system correct to a better more efficient price and wage... so they are letting us all become Detroit, Newark , Chicago, Boston, New York,... and all the other rotting piles of democrat group think societies.
Taxes are sucking money out of the middle class and making them dependent on government in order to send their kid to college , pay their housing, pay their car, give to charity and save enough for retirement .
This is absolutely the fork in the road. The congressional elections are about the last chance and ACORN brown shirts are stealing election after election with fake votes, rigged counts and NOBODY is hearing the law abiding tax payer say, "ENOUGH!!" Stop the BS.
If the Iranians nuked DC while congress was in session with everybody in town.... I'd mourn for about 2 seconds, but would get over it quickly. I'd sure miss the Smithsonian, 8th and I, Iwo Memorial...... and that's about it.
although with the upswing it it tempting to jump back in i am holding off as i just do not trust it and watch each day for the freefall to begin again....this isn’t over by a long shot...
I remember during the last administration...we were told not to be fooled by small drops in the Dow.
exactly what i was thinking and about to say....
But, but, but, I thought socialism was going to make us all equal. I thought they were going to pay my mortgage for me!! I thought they said they would make everything better and life would be a utopia when they got in charge!! I thought they would make us all well!! They promised. They said they would FIX everything. They promised!!!!!!!!!!!!!!!!!!!!!!! massive sarcasm still dripping off my finger tips as I type
Damn, why don't we just give them their house. Obama is president, why do they have to make any mortgage payments?
Recently, you had a link, I think, about Meredith Whitney’s comments. Do you still have it?
History says about 4- 6 months but I'm more worried about the dead-cat splat at the bottom.
Bump for later
All this new money may well buoy the stock markets until the dollar falls off the table and inflation starts to hit.
This is absolutely the fork in the road. The congressional elections are about the last chance and ACORN brown shirts are stealing election after election with fake votes, rigged counts and NOBODY is hearing the law abiding tax payer say, “ENOUGH!!” Stop the BS.
The real problem is the average middle class american voter in middle America is now about 40% likely to vote democrat even in most conservative areas. Look at rural Indiana counties that voted 50/50 in last election or even for Obama!
We can blame ACORN all we want but the middle is no longer holding due to miseducation and lack of a clear conservative choice to straighten their heads out.
...several people have mentioned commercial real estate as the next shoe to drop....get a load of General Growth(one of the largest Mall operators in the country)....so long gold card shoppers; hello ghost town Malls.
http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=ggp&sid=0&o_symb=ggp&x=29&y=15
....ooops!...should have posted an “ugly chart ahead” warning.
If your gut isn't telling you something is SERIOUSLY wrong, just ask yourself this, what has changed from Sept? Discount the fact govt has put us all on the hook for another 12 trillion dollars. Discount that unemployment is starting to mimic a shuttle launch. What is telling you everything is all better?
The failed Obama Presidency owns this depression.
Obama is President. "The Poor" don't need to make payments on anything anymore. We have HopeyChange!
You are right about rural Indiana. There are increasing numbers that are waiting for a handout and if they vote, they vote for a liberal.
IMHO the current upswing (bear market rally) won’t last very long, and may be nearing the end now. Came up too far, too fast (once again, IMO). I would not be surprised if large pools of money (Soros, Sovereign Wealth) pushed things up temporarily. The object just might be to get the 0bama budget passed. Once that is accomplished it will be time for more “crisis” talk for Stimulus II. No real sustained market rally will be possible until we have the hope of gridlock looking forward to 2010 elections.
Wall Street is completely divorced from Main Street...due to globalization and stupid trade policies...what was once about 16% (financial)sector is now a 40 % sector...there is no underpinnings to this so called service economy which in my opinion is not sustainable- a role manufacturing once played...there is no easy answer to unemployment because many of the jobs lost are gone for good...the fact that tons of these jobs were well paying jobs with health benefits also makes it very likely that National health care will be enacted in the next year or two as well as other socialistic policies to deal with what may become a permanent underclass...this is certain to lead to social unrest...I have said for many years on this forum (and been beaten up for saying it) that free trade as practiced now would destroy our economy and lead to socialism...that the loss of good paying jobs in manufacturing and industries like tech which are being sacrificed on the alter of so called free trade and globalization (outsourcing) would destroy the American consumer market by destroying the middle class.How can you have a comsumption based economy when the buying power of average Americans is declining sharply with no end in sight? I take no joy in seeing my fears realized. The idea that we can remain an economic powerhouse when we make almost nothing and are depending on the financial sector to be the major player in the economy-they CAN NOT create wealth-is insanity and a form of national suicide...if we are not economically powerful, we will not remain militarily powerful for long.
I do not foresee going back in anytime soon.
Garde la Foi, mes amis! Nous nous sommes les sauveurs de la République! Maintenant et Toujours!
(Keep the Faith, my friends! We are the saviors of the Republic! Now and Forever!)
LonePalm, le Républicain du verre cassé (The Broken Glass Republican)
[How long to you think the dead cat bounce will last?]
That is the key question. I think from the charts I’m looking at that things could be somewhat rosy until even August. But there is nothing but bad economic entrails to auger the future. The inflationary spending and taxes don’t even really hit until next year.
I figure you have about 4 months to get your act together.
[Seems to me traders still think this is 2006 and we will be back to records in no time.]
We are hoping to bug out the last of our stock positions now. A lot of traders are Democrats who believe in Obama the Tooth Fairy.
“Ihave said for many years on this forum (and been beaten up for saying it) that free trade as practiced now would destroy our economy and lead to socialism...that the loss of good paying jobs in manufacturing and industries like tech which are being sacrificed on the alter of so called free trade and globalization (outsourcing) would destroy the American consumer market by destroying the middle class.”
.
You are absolutely correct. Because we now live in the age of ‘newspeak’. That which is presented as ‘free trade’ by the globalists who negotiated various ‘free trade’ agreements (Nafta, CAFTA, etc.) is probably not what most people think of as ‘free trade’.
In these agreements, US sovereignty, & national security are sacrificed to open borders needed for the unimpeded movement of goods and natural persons, i.e. units of labor.
US business (not global corporations) and US workers are placed at a severe disadvantage by onerous taxes, extreme environmental regulations, political correctness. Countries such as China and India are excused from even minimal environmental regulations,from what we would consider even minimal humane working conditions, and any semblance of political correctness.
In addition, most other countries have a VAT (Value Added Tax). If the VAT is say 15%, other countries refund that 15% when goods are exported here. These countries then add 15% to US goods imported there, putting US manufacturers at a 30% disadvantage.
When it comes to the elite who negotiate ‘free’ trade agreements in our names, both Republicans and Democrats have been bought and paid for by global corporations and global bankers.
The ultimate result is the destruction of our sovereignty, security, freedom, middle class, and way of life.
To paraphrase some one else who posts here ‘The Globalist understanding of “free trade” is to make us a milk cow for the third world and their pocketbooks’.
In the business park my office is in, there are entire buildings vacant. I estimate a total of 30-40%. Much added in the last 4 - 5 years. Someone is loosing money bigtime.
You said it much better than I ever could...you are absolutely correct...this free trade madness must end...balanced trade is the answer...for example if Japan continues to put a 30 % tax on us...they get the same treatment...we have become the laughingstock of the world with our trade policies...no other country would ever do such a thing. It reminds me of Gulliver when all the little folk tied him down...we must stop this and soon.
Your tag line is TOO TRUE!
There are none so blind ... as they that will believe the medias ...
Willing to trust the very ones walking them to disaster, ignoring the printing of money ... inflation is very close. I know a few that are having a great time playing the stock market everyday.
INSANE!
They do not consider that is part of the problem ... taking advantage of others ... a from of gambling ... nothing is produced. Some win ... some lose.
Obviously it has tipped over and is growing part of the world today in America.
We are going in the direction of increasing this factor daily. BIG MISTAKE!
Humans do not like to risk the known for the unknown ... even when the known is BAD! MO
Me too. I think it's going to be a real stinking corpse.
“Very dangerous.”
Yep. I have made a tidy sum the past 2 weeks with Bank Of America, PetSmart, Intel, HP, and Helmerich & Payne.
But its been with PURELY speculative money. Just like going to Vegas. I can lose it and walk away.
I've been noticing a trend for a few months now. Every time the market goes up, there's a sharp rise in the volume of trades. I've been wondering if somebody's manipulating the market. I wonder if it's our own government.
Go to http://finance.yahoo.com/ and play with the chart yourself. Every time the volume goes down, so does the DOW. Somebody's pushing it up.
There were a few days at the beginning of March where month-long trends started being broken up. The DOW had taken on a particular pattern as it fell. Suddenly, the day's trend was still normal, but at the end of the day, the volume of trades rose higher than in earlier days and every time that happened, the DOW rose.
At first I thought it was due to people buying in at the bottom of the fall, but I started noticing that this happened on days with particularly bad news. (The new unemployment numbers came out, housing numbers came out, bad news with the banking crisis, etc.) This made no sense to me. Traders aren't a stupid lot and the writing was on the wall. How was it that bad news could suddenly cause a spike that would've caused a drop just a week before?
I can't explain it any better, but I smell a rat. If I had more than a couple of hundred dollars in the market, I'd be using this bounce to get out now. I agree with you completely that it's going to crash again to give the gov't an excuse to grab more power. We're being played.
Commodity stocks making the big jumps could be a warning for inflation soon to come.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.