Tag: Economic Indicators

What The Hell Are We Thinking?

All the economic blocks came tumbling down by the greed and the avarice of a few nasty individuals….hence the OWS movement and governments response to those protests….we all know this…that is unless you are one of those Geico guys that lives under a rock…..

But last week we got just a pile of good news……EU deal to save Greece and the economy, good employment figures and great GDP report….and as predicted the speculators on Wall Street went on a total orgasmic run on the Markets….all is well in the world and the shining light of prosperity and the American way will once again return so that we Americans have no worries at all….right?

Over last weekend I was talking with a friend who has most of her money in different market accounts and after a horrible couple of years was breathing a shy of relief at all the good news she had seen recently…..of course being the bummer that I am ….I told her to not get too excited just yet….and told her to keep an eye on the European situation for it would influence her investments in the near future…..Of course, she thought I was just being a bummer because she knows of my left leaning views….I smile and said….”I WILL tell you, I told you so”…….

Let me be honest what lead me to say these things was a report in the Telegraph out of London….

As someone who works in financial services, I follow the markets – in the West, across Asia and the entire world – closer than most. Since the Bear Stearns collapse in March 2008, through the demise of Lehman Brothers and its ghastly aftermath, much of my professional life has been dominated by the angry flashing of those little lights on a Bloomberg screen.

In recent years, the violent gyrations on financial markets have been deeply discomforting, causing angst among market professionals, like me – but that is the least significant aspect. For those little lights represent, of course, the ebbs and flows of cash which, in turn, determines the fate of real businesses. It is at the sharp end of employment and livelihoods, dispossessed homes and broken families that the human impact of financial turbulence is most keenly felt.

So, yes, I want such turbulence, which will never be fully-eradicated, nor should it be in a free-market system, to now lessen to more manageable levels. Yet the responses of our politicians to recent financial troubles – hiding behind complexity and kicking the can down the road – have not only failed to temper the volatility, but have actually made it much worse.

Last week’s eurozone “agreement”, for all the related fanfare, was a case in point. Far from making the situation clearer, allowing investors to make considered assessments, this latest announcement made Western Europe’s grotesque debt crisis even more acute, sowing further infectious spores of confusion.

Read More…

I you are invested heavily in the markets, which most working Americans are with their 401ks, then keep an eye on the EU thing…..remember NO matter what happens Wall Street gets their cut out of your money….there is only ONE way to strengthen the retirement of Americans….a stronger Social Security that means more government involvement……like it or not……

P.S.  While this draft was waiting posting this bit of info came along…..

If Greek voters reject the unpopular bailout plan it could result in a “hard default”, which could force banks to take losses of about 75 percent on their Greek sovereign bonds, trigger payouts on credit default swap insurance contracts, and raise the threat of a systemic risk.

Like I said keep your eye on the EU……our future is tied to them!  IT IS NOT OVER!

Waiting For The End

When I came up with the title I immediately thought of the Doors……

Before I go on….over the weekend I heard Sen. McConnell when criticizing Obama’s new proposal, he said….”Tax on billionaires?  Who thinks this is a good idea”….I wished I would have been there in person for I would have said…..EVERYONE but the cowards in Congress!

Okay now to the meat of the post…….I know some will say that I am harping on the premise that the Middle Class is disappearing….I posted much on the subject….but this time I ran across an article that puts it all in perspective…..warning!  It is a long piece with many links……but if you want proof of the assertion then please read the article and the facts and then tell me that I am over-reacting……

http://bit.ly/nBMAUU

Like I have said….lots of info to digest….but the end is coming……and unless we, the American people, do something drastic then you can kiss the Middle Class….GOODBYE!

Three Cheers For The Recovery

From the VOMITORIUM

Who will be claiming responsibility for the slowdown in the economy, slowed to 1.8%, below the expectations of all the economic wiz kids in Washington….but it is still growth, just at a slower pace….we will hear the experts say on the tube….look, the will say, inflation is down or holding steady……good one….that is because they do NOT figure in gas prices of food….if you throw that in then our inflation is about to run wild….every quarter we hear how well the economy is doing….then explain to the millions at are unemployed…..we hear that the markets are doing well,  so good that we have not seen growth like that since 2008….then explain it to the people who have lost their homes in the last month…..go ahead I will pause here for your explanation………(waiting…..waiting……)

Wait!  They have an answer!

The first-quarter increase reflected growth in personal consumption expenditures, private inventory investment, exports and nonresidential fixed investment. Federal, state and local government spending fell. Imports, which negatively affect the calculation of GDP, increased.

See told you there was good news (sarcasm, in case you missed it)……

But there are few questions that need to be asked of Bernanke or Geithner or whatever Wall St. insider is at the helm of our economy…… American labor has issued a couple of questions they would like to be answered….and I think they have some excellent questions….

1. Where are the jobs and why are the implications of the Fed’s actions so far not leading to sufficient job creation?2. How is the Fed going to respond to continuing weak economic growth?

3. How is the Fed taking into account in its decisions the powerful headwinds facing the economy, including falling housing prices, rising energy prices and large-scale layoffs and wage freezes for public employees?

4. How will the Fed’s policies address the inadequate public investment in the United States?

5. What is the Fed’s plan for closing the gap between economic growth and job creation? Between productivity growth and wage stagnation?

6. Can we have a healthy economy until we deal with rising inequality?

7. Is there anything the Fed can do to revive our economy if government at every level persists in irresponsible, job-destroying budget cuts at a time of economic weakness?

We will know just how f*cked we are…these questions will Not be asked by anyone in the media….and there will be NO answered offered up by the government….so we will continue to be subjects of the elaborate con job that is economic recovery……

And the disconnect does not stop there…..a recent poll shows that majority of the people feel that the economy is going badly…..the disconnect is that the media reports on macro-economics and Main street lives with micro-economics….and Main Street could give 2 shakes in Hell about the debt…..their personal debt concerns them…food prices concerns them…..being unemployed concerns them…..macro-economics concerns them not…they do not care that Samuelson basically invented the study of the macro field…they do not care…their only concern is their family and their livelihood……

Germany: Miracle On Life Support

College of Political Knowledge

International Studies Group

European Desk

Last Friday, Aug.13, 2010…the economic news brought us a good picture of Germany and Europe…all the economic pundits on the airwaves were jumping and jerking off at the news that the economy in Germany rose by 2.2 percent, which helped the EU rise by 1%….all in all good news right?

I got to think about the US and all the “good” news in the US….that about earnings and growth and……I just had to do some research on what was really happening in Germany…..

The German figures have been greeted with euphoria and self-congratulatory pronouncements by bankers, government officials and sections of the German media, but as Financial Times columnist Wolfgang Münchau pointed out recently, the German economic recovery is more “mirage” than “miracle.”

Germany was able to regain some economic ground in the early part of this year due to stimulus subsidies made available to employers by the government. But as is the case in France and many other European countries, these subsidies, such as short-time working, have largely come to an end.

Germany’s export industry also benefited in recent months from the fall in the value of the euro, which at one point declined to near 1.20 per dollar. In recent weeks, however, with concern growing over the prospects for the US economy, the euro has risen toward the 1.30 per dollar mark. The strengthened euro makes German exports less attractive on world markets.

The strength of the German economy is also its Achilles heel. Germany’s relatively expensive exports can find buyers only under conditions of expanding markets. But urged on by the German government, one European nation after another has introduced drastic austerity programs, which will inevitably depress economies and choke off consumer demand, with far-reaching longer term implications for German exports.

Recently, the US was lectured by the EU, at least some in the EU, to get our run away spending in check or we could suffer the same as Greece….there has even been some US pundits that has said similar stuff….the truth is….that most of Europe would just sh*t if the US stopped spending….the rest of the damn world dependsw on the spending habits of the US, both private and public.

In other words….Germany’s miracle on the economic front is NOT such a miracle.  Makes good copy and makes good fodder for some politicos but in reality…… Germany needs the US to continue spending and spending…if the US becomes serious about its deficit then the rest of the world go into the crapper….what to do?….what to do?

Economic Reasons To Vote In 2010

The primaries are in full swing as we speak, but the real test will be in November when the many general elections will take place…..there are many reasons to vote….smaller government, the deficit, hatred of a Rep….many reason….but I believe that the main reasons for voting this year will be the economy and its solutions…..

Eavon Javers of Politico has put together a very fine list of economic reasons to vote…..

1. August jobs report

August jobs report — which comes out September 3rd — will likely set the tone for the fall political campaigns. A strong, upward trending number will mean the Obama administration and congressional Democrats can hit the campaign trail bragging that their policies are working. An anemic report, and House Minority Leader John Boehner (R-Ohio) and other Congressional Republicans can — credibly — continue to complain, “Where are the jobs, Mr. President?”

2. Third round of stimulus reporting

News from the first reporting period last fall was anything but reassuring: jobs reported in non-existent congressional districts, bogus zip codes, and a debate over the meaning of “saved or created” jobs. The Obama administration’s protests that some amount of human error is inevitable in such an unprecedentedly large transparency effort notwithstanding, stimulus critics had a field day. The Obama administration says it has fixed the reporting problems that bedeviled the first data rollout.

Now, with the federal budget deficit and Obama’s spending serving as rallying cries for an increasingly potent conservative tea party movement, the numbers due to be submitted to the government by a July 10 deadline are going to be watched more closely than ever, as Obama’s critics seek any evidence to show that the stimulus isn’t working, and Democrats sift for data that prove it is.

3. Second quarter GDP report

But just how much growth will be the key question. The first-quarter number showed the economy expanded at 3.2 percent in early 2010, which was less robust than the 5.6 percent growth that it saw at the tail end of 2009. That gave political bears (that is, Republicans) a chance to argue that Obama’s policies weren’t achieving traction, and the U.S. might be headed for a “double dip” recession.

The second-quarter number will establish a trajectory — and let both bulls and bears know whether a double dip is in our future or not.

4. Third quarter trends

Many economists estimate that the economy will begin to tail off in the third quarter of 2010 as federal stimulus spending begins to taper off, too. So the months of August and September — which will help set the public’s impression of the economy ahead of the election — will be crucial. If the estimates are right, watch for the White House to argue that the economic softening is less than expected — and for Republicans to pounce on any evidence that the economic recovery is faltering.

5. Bernanke’s choice

The Fed has injected more than a trillion dollars of liquidity (read: cash) into the U.S. economy in the wake of the crash of 2008, and as the economy recovers, Fed Chief Ben Bernanke & Co. will be under increasing pressure to pull back and raise interest rates to stem nascent inflation.

Interest rates have been at close to zero for a year and a half, and some in Fed land are beginning to openly talk about raising rates. During a speech June 3rd, for example, Atlanta Fed chief Dennis Lockhart said, “The time is approaching when it will be appropriate to consider recalibrating interest rate policy.”

There are many choices that can be made when one stands in the election booth, but it is my opinion that none of it will matter if the economy is still in the crapper…..

Are You Economically Confused?

Daily Agitator

If you do not have a degree in economics or finance and try to listen to the “experts” on TV then you are so confused that you would agree to anything just to get these people to shut the hell up……

For instance, the US gain 290,000 jobs in April but yet the unemployment rate went from 9.7% to 9.9%….if you gain jobs how does the unemployment rate get larger?  Easy if you listen to the “experts”……it seems that more people went back to looking for work because the jobs market is looking better……that is the official announcement……but if the people were unemployed in April and are looking for work then they are still unemployed…so how does the rate expand?  It is all in the metrics of the science…that would be the science of bullsh*t…….all reporting is that the “real” unemployment rate is more like 15+%….but yet they have come up with a way for the dismal unemployment rate to appear more optimistic……it is all for the investor to get them excited about using their cash……never is it about the true outlook of the recession….

If you feel totally confused, then you are what I call an average person and NONE of the economic reports are for you….NONE of the economic reports take your life into account……..remember….YOU ARE the back bone of this economy and if your life is in recession then the rest of the country is in recession…..the investors and speculators will ALWAYS make their money, whether you are employed or not…

The problem is that they are gambling with YOUR money…the cash of the taxpayers is used in this casino called Wall Street….

Recovery Well On Its Way!

Daily Agitator

May I see a show of hands from all those that see a clear path forward in the economic situation we are fighting these day?  If you raised your hand please write down why you feel the recovery is doing well…..

Gross domestic product, the broadest measure of economic activity, rose at a 3.2 percent annual rate in the first three months of the year, the government said Friday. That was the third straight quarter of increase, driven by a rise in spending by American consumers and increased business investment.

Good news, right?  Well yes and no…yes, it means that Americans are spending, but if they are spending they are not saving…..which is good if you want the economy to recovery…but then are they spending “real” money or their plastic?  If the later then a personal recovery is NOT going to happen and this could start yet another recession or at least feed it….to my mind this is “plastic” spending and in NO way shows that the rest of the economy is in good shape.

Unemployment remains steady at 9.7% or so and that is just those applying for benefits, nothing is said about the many that are gone from the rolls and may have stop looking for work……even this supposed “good news” economically if it stays kind of consent will mean only about a .5% drop in unemployment at the end of the year…

Once again the “good news” is for investors not those that actually work for a living……..

drags on the economy this year are residential and commercial real estate. In the first quarter, both declined, with residential investment falling at a 10.9 percent rate and investment in business structures dropping at a 14 percent rate.

As much as some do not want to admit…if it were not for the stim plan….we would be under a huge pile of crap…….the stim plan has done a lot to slow the recession, for without we would be standing in a soup line…..I know it is government spending…but if not them…then who?

There is only so much crap that they can spread on the economy and believe me….they lay it on thick!  Look into your wallet……is the recession getting better?  Is the recovery effecting you?

The 10.2% Solution

No!  I am not talking about the cocaine injection used by the great Sherlock Holmes!

It is the latest figures released on the unemployment in the US….but if we figure in those who have come off the rolls or have just gave up on the prospect of having a job, then the figure would be closer to 20% or more.

Let me see….we threw money at banks….most are now stable…..most are once again giving those great bonuses to the idiots that cause this recession…..then the auto makers got their piece of the pie….although it was a smaller piece than the banks got….they are doing sort of okay….and now the rise in home starts….existing home sales….yada yada….we are being told, in some circles, the recession is over and that we must be patient and all will be good…….

How nice….but all is NOT good…..unemployment is still rising…foreclosures are still rising…..bankruptcies are still high…..consumer spending is still almost non-existent….but things are getting better….

I think that the banks have had enough good fortune….maybe the admin needs to come up with a 10.2% solution….it would solve a lot of the problems we “real” people have….we have had enough of “banks…banks” we need “jobs…jobs”!  Maybe some of that cash that has not been spent on the thieves could be spent creating jobs…just a thought!

One of my fav comments was made by the CEO of Goldman-Sachs, who makde about $68 million last year, that the bank is doing God’s work……think about that for damn minute…..doing GOD’S work….I bet you did not know that God was a capitalist did you?

Does that not sound a bit pretentious?  These banks are NOT creating anything but wealth for themselves…they are helping NO one out in this recession.  Actually, they are still making the same types of trades they did in the past that blew up in their face, but this time they are betting on the government again to cover their losses.

YOU are covering their losses and YOU a getting nothing in return….GET MAD!

So we need a 10.2% solution…it can begin with YOU….burn up the phone lines….reload their emails…..write a damn letter….let Capitol Hill know that it is time for them to get off their butts and STOP covering for the banks….YOU CAN DO IT!  But are you a wimp?  Stop bitching about everything and DO SOMETHING….even if it is wrong…at least you tried…..

However, please do not try to sell us the tired old argumnent that cutting taxes will create jobs…..if there is NO demand for products there will be NO jobs……the only demand that has been created so far is a credit demand with first time home buyers and cash for clunkers….the problem with those is if there is NO job…there will be little buying…..again…the creation of demand should be priority one.  For demand will create jobs and jobs will create more demand…..pretty straight forward stuff….

Jobs!….Jobs!….Jobs!…..

The news is not good on the job markets…..we keep losing job after job, but yet the recession is over……well that is crap to begin with….it may be over for investors but if you work for a living it still very much a threat to your life.

Sorry…I digress…….since the GOP has absolutely nothing to counter any Dem proposal on health reform, they have jumped head long into blaming Obama for the jobs lost and immediately equate that with a failed stim plan that he, Obama, had passed in the early days of his presidency.

Bloomber is reporting”

Republicans said the jobs data are evidence Obama’s $787 billion stimulus plan and the administration’s other economic recovery programs are failing. The report put Obama on the defensive after previous economic reports signaled a recovery was gaining traction.

Within minutes of the release of the government’s report, Republicans began e-mailing statements faulting Obama’s policies.

“President Obama can either acknowledge that his economic experiments have failed and change course, or continue down this path and see even more Americans lose their jobs,” Michael Steele, chairman of the Republican National Committee, said in a statement.

House Republican leader John Boehner, who criticized Obama for traveling to Copenhagen, said Democrats’ pledges that the stimulus package would create jobs are proving false.

bama may soon suffer the political fallout from the recession, said political scientist Bruce Buchanan at the University of Texas in Austin. The president and his party would pay a price in next year’s congressional elections if the numbers continue to disappoint.

Democrats at this point aren’t in danger of losing their majorities in Congress, he said. The political damage will be limited, “barring some peg to hang repetition on.”

When Obama took office in January, the U.S. unemployment rate was 7.6 percent. September’s unemployment figure would have reached 10.4 percent if hundreds of thousands of Americans hadn’t opted out of the labor force because jobs are so hard to get, Rupkey said.

Unfortunately, the voter does not realize nor care that any job losses began a year before Obama took office….all they know is that their neighbors and friends are unemployed and the sitting president will have to suffer the consequences of someone else plunders.

The Repubs will attack and attack the Obama admin, and eventually they will hit on something that will resonate with the voter, whether it is true or not, the voter will take heed….and it appears that jobs may just proves to be that position that actually works and not backfires on the GOP.

Was It As Bad As They Said?

It has been a year since the massacre of last October, economic massacre that is…..but was it as bad as they all said it was?

The AP has published a pretty good list of then and now sort of stuff:

• $11.2 trillion: Total losses in the stock market from the Dow’s peak in October 2007 to the March 2009 bottom.

• $4.6 trillion: Total gains in the stock market since March 9.

• 6: The number of the 10 worst point drops in the 113-year history of the Dow that occurred in 2008. The 777-point drop on Sept. 29, 2008, ranks No. 1.

• 3: The number of the 10 worst percentage drops that occurred in 2008. The Sept. 29 decline of 9 percent is the third-biggest behind 22.6 percent on Oct. 19, 1987, and 10 percent on April 14, 2000.

• 92 percent: Decrease in Citigroup Inc.‘s share price from Oct. 10, 2008, ($13.90) to March 9 ($1.05).

• 341 percent: Increase in Citigroup‘s share price from March 9 to Friday’s close of $4.63.

• 18-20: The historical average for the Volatility Index of the Chicago Board Options Exchange, also known as the VIX, or “Fear Index.”

• 89: Where the VIX peaked last October.

• 23: Where the VIX was on Friday.

• 16 percent: The amount by which the Dow’s closing level on Friday was higher than its average close the previous 200 days. Earlier this month the number hit 20 percent, the highest since the early 1980s.

• $6.5 trillion: Value of assets in stock mutual funds at end of 2007.

• $3.7 trillion: Value at the end of 2008.

• $4.5 trillion: Value at the end of August.

• -$72 billion: Net cash flow (money put in minus money taken out) for stock mutual funds in October 2008.

• -$25 billion: Net cash flow in March.

• $4 billion: Net cash flow in August.

• $9: The amount, out of every $10 investors put into mutual funds in August, that went into bond funds.

• $855.40: The price of an ounce of gold on Oct. 10, 2008.

• $1,048.60: The price of an ounce of gold on Friday.

• 6.2 percent: Unemployment rate a year ago.

• 9.8 percent: Unemployment rate today.

• 95.2: Consumer confidence two years ago. Reading above 90 means the economy is on solid footing; above 100 signals strong growth.

• 25.3: Consumer confidence in February — record low.

• 53.1: Consumer confidence today.

• 2.8 percent: Decline in retail sales in October and December 2008.

• 2.7 percent: Increase in retail sales in August.

• 4.75 percent: Federal funds rate two years ago.

• 1 percent: Fed funds rate last October.

• 0 – 0.25 percent: Fed funds rate today.

• 4.81 percent: London interbank offered rate (LIBOR), the amount banks charge each other to borrow money for three months, at its peak, on Oct. 10, 2008.

_0.28 percent: Three-month LIBOR rate Friday.

• -0.5 percent: Personal savings rate in 2005 as home prices were soaring.

• 6.9 percent: Personal savings rate in May.

• $975 billion: Credit card debt held by Americans last September.

• $899 billion: Credit card debt held at the end of August, down 8 percent.

• 7 million: Home resales in 2005, a record year.

• 4.5 million: Home resales in January at annual rate.

• 5.1 million: Home resales in August at annual rate.

• $245,000: Median price of homes sold in 2006 — record high.

• $213,000: Median price of homes sold last October.

• $195,000: Median price of homes sold in August.

Like I said a pretty good list….but what does it all mean?  If you are rolling in money then all this means that you will probably make more money to bath in….but if you are human and have lost your job or are worried about your job then none of this means CRAP!  So they make the news for people with money….the rest of us know that it is unrealistic to say the recession is over…..go shopping and tell the world just how much you appreciate all the good economic news….