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11.20.09- Housing Recovery Built on Sand
With the $8,000 tax credit originally set to expire, housing starts plunged nearly 11% in October, to a seasonally adjusted annual rate of 529.000 units. That put new home construction back to the dismal levels of last spring before a temporary blip lifted housing activity during the warm-weather months. Even though the home-buying subsidy was extended through next March and expanded beyond first-time buyers, there's little evidence that these giveaways are working. Applications for mortgages for home purchases, for instance, fell to a 12-year low last week even with a 30-year mortgage going for well under 5%. Read More
11.19.09- The Partnership Between Wall Street and the Government Will Continue Until the System Collapses
Well, the boom is over, so what about now? The current notional value of derivatives on US commercial banks' balance sheets is $203 trillion. 97% of these ($196 trillion) sit on FIVE banks' balance sheets, according to a recent report from that very same Office of the Comptroller of the Currency. Read More
11.18.09- Let's Get Fiscal
11.17.09- Fallacy of recovery
The mainstream media is full of reports of economic recovery and an end to the recession of 2008, even though the Business Cycle Dating Committee of the National Bureau of Economic Research has not yet spoken its official word on the matter. The significant rise in the stock markets and a single advance GDP report has been enough to convince nearly every economist and financial analyst that the worst is past, that 10.2 percent unemployment is a lagging indicator, and that the primary concern at hand is now too much monetary and fiscal stimulus leading to inflation. Read More
11.16.09- Four Reasons Hyperinflation Hasn't Hit the U.S. Economy Yet
But we're not...yet. Classic economic theory says that money supply can be used to stimulate the economy and our central bankers seem to agree. That's why they've pumped more than $1 trillion dollars into the economy, engineered countless bailout bonanzas for zombie institutions, put Detroit on life support, and delivered a bunch of financial Band-Aids to the trauma ward - all in a desperate bid to make Americans feel better about the global financial crisis. Read More
11.14.09- Job Losses Demystified
11.13.09- Hard Times and Bad Behavior
More specifically, I (and others) asserted before the unraveling began that challenging economic conditions would lead to an uptick in illegal activity, particularly opportunistic crimes, among formerly law-abiding citizens. While that might seem obvious to some, there has in the past been some debate about the issue among criminologists. Read More
11.12.09- Risk Aversion Creeps Back into the Currencies
11.11.09- FedSpeak Translation -
In separate speeches, Janet Yellen, president of the Federal Reserve Bank of San Francisco, and Dennis Lockhart, president of the Federal Reserve Bank of Atlanta, warned that rising unemployment could crimp consumers, restraining the recovery. Consumer spending accounts for about 70 percent of economic activity. That's because there is no real economic recovery at all. So why is the stock market up so much? More than happy to show 'ya. Read More
11.10.09- De Nile is not just a river
in Egypt
...wait until you see what's in the cards for commercial real estate. That's right, the next train wreck will be in commercial real estate. Couldn't be worse than last year's residential market crash? That remains to be seen. But it's coming soon, probably as early as the second quarter of next year, and there's nothing that can prevent it. The government will intervene, trying desperately to delay the day of reckoning, and may even succeed. For a while. But make no mistake about it, that train is going off the tracks no matter what. Read More
11.09.09- At The Margin
11.07.09- The Truth About Jobs That No One Wants to Tell You
In other words, ten percent unemployment really means twenty percent underemployment or anxious employment. All of which translates directly into late payments on mortgages, credit cards, auto and student loans, and loss of health insurance. It also means sleeplessness for tens of millions of Americans. And, of course, fewer purchases (more on this in a moment). Read More Copyright © 1996-2009
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The only real surprise in the latest disastrous batch of data on housing is that anybody is surprised. 
"Hindsight is a wonderful thing," said Timothy W. Long, the chief bank examiner for the Office of the Comptroller of the Currency. "At the height of the economic boom, to take an aggressive supervisory approach and tell people to stop lending is hard to do." 
There's no reason why a sharp-witted politico like Barack Obama can't survey the wreckage around him and draw the same conclusions as FDR. The unemployment crisis should be the president's first order of business; Job 1. Instead, Obama is paralyzed by indecision, unable to settle on a policy that he's willing to stick with through Hell-or-high-water. His lack of resolve shows that he's got his priorities mixed up and that he's getting bad advice from his lieutenants. The economy needs more jobs to get back on track and make up for flagging demand. Those jobs are not going to come from the private sector which is struggling just to stay afloat. They'll have to be created by the government; major public works programs expressly designed to put millions of people back to work. These are precisely the kind of programs that conservatives and Libertarians despise, which is important, since it lays the groundwork for a national debate on the role of government. This is a debate that Obama can win, provided he stops waffling and shows some moxie. 
Everything we know about classic economic theory suggests the U.S. economy should be experiencing Zimbabwe-like hyperinflation right now, thanks to the nearly $2.2 trillion the U.S. Federal Reserve has pumped into the system.
As the unemployment rate crossed the double digit barrier for the first time since Michael Jackson learned to moonwalk, President Obama announced that he will convene a "jobs summit" to finally bring the problem under control. Using all the analytic skill that his administration can muster, the President is determined to figure out why so many people are losing their jobs and then formulate a solution. That's a relief; for a while there, I thought we were in real trouble! In fact, the absolute last thing our economy needs is more federal government interference. If Obama really wants to know what's behind entrenched joblessness, he should start by looking at the man in the mirror. 
Although scientists or statisticians might disagree, I reckon that if certain trends are now apparent in countries and cultures around the world that were not really in evidence before the financial crisis struck, then it's probably a good bet that the circumstances are somehow related.
Last night I was doing some writing, and before I put the laptop to bed for the night, I checked the currencies, and while they had drifted in the early Asian session, the Big Dog, euro (AUD) had set a 15-month high of 0.9368... But when I turned the currency screens on this morning after arriving to a pitch-black office, the euro had given back about 0.5 cents, and so had the Aussie dollar. So, it was my mission to find out what caused this slippage. 
Yet more BS Fedspeak, 
If You Thought the Housing Meltdown
Was Bad
How can the stock market continue to set new rally related records week in
and week out? Answer: As per our discussion 
Unemployment will almost certainly hit double-digits next year - and may remain there for some time. And for every person who shows up as unemployed in the Bureau of Labor Statistics' household survey, you can bet there's another either too discouraged to look for work, or working part-time who'd rather have a full-time job or else taking home less pay than before (I'm in the last category, now that the University of California has instituted pay cuts). And there's yet another person who's more fearful that he or she will be next to lose a job.
