The horn tooters have to wait at least another month before the recession is over judging from the non-manufacturing ISM numbers.
Please consider the July 2009 Non-Manufacturing ISM Report On Business®.
The report shows the NMI (Non-Manufacturing Index) dropped .6% in July to 46.4, contracting for the 10th consecutive month at a slightly faster rate.
The table shows that 8 out of 10 Non-Manufacturing components are worse this month than last month. Only deliveries are in the green while inventories are contracting at a slower rate.
Yesterday we detailed the different between this current economic contraction, and your usual run of the mill plain vanilla recessions. We also went over the MASSIVE consumer credit contraction that needs to occur before American households have finished de-leveraging.
Today, we’re detailing why stocks will Crash this coming fall. As you know the media is rife with folks calling the end of the recession and the beginning of a new bull market. It’s clear to me that this is a load of nonsense. Today I’ll show you why.
Because a lot of the alleged “analysis” that is backing up the bulls’ claims of a new bull market comes from technical analysis and charts, I’m presenting the below chart from David Rosenberg of Gluskin Shef. It charts today’s bear market over that of 1929-1932.
ABC Weekly Consumer Confidence has flatlined, and not only is it down to -49 from last month's reading of -47, it is at exactly the same place it was two months ago.
Declining levels of consumer comfort usually accompany any fall in income and wages and precede drops in consumer spending. A low or falling ABC Consumer Comfort value is considered an early indicator of an economic downturn. As a result, investors, retailers and traders alike all watch the figure for insight into the general health of the economy.
Note: The index incorporates the most recent week's data with the results of the past three weeks, yielding a rolling four week average. Results are calculated as the difference in percent of positive and negative numbers.
It is thus my position that even if you are well under FDIC limits you must move money around now so you have multiple bank accounts and thus if your withdrawals and access to your funds are "rationed" in a similar fashion you will be able to access what you need to pay your electric bill, put gas in your car and buy your food.
Remember, getting your money back doesn't mean getting it all right now, and government agencies can be very inflexible when what they have decided to do conflicts with what you want.
Since the government is not going to do the right thing with regard to these financial institutions and their alleged "assets", say much less crooked accounting and disclosures - a fact that now, two years into this mess, should be the inescapable conclusion reached by anyone with a brain in their head - you need to protect yourself.
Our phony economy is being propped up by the stimulus and artificially low interest rates, and all of that has to come to an end if we want to stop the dollar from collapsing."
Unless the Ponzi can be maintained in perpetuity, when the house of cards falls, the double whammy from savings increase will have a dramatic adverse impact on the economy.
GMAC Inc., said Tuesday it posted a wider second-quarter loss of $3.9 billion as it shifted from being primarily an auto and mortgage loan company to an online, retail bank. In the year-ago period, the company posted a loss of $2.48 billion.
The seizure by the FDIC will hit the regulator’s budget to the tune of at least $5.3 bil according to sources within the OTS. This, on top of what’s going on with Colonial bank failing, should wipe out what’s left of the FDIC’s budget
G.M. said Monday that about 6,000 hourly workers had left as of Saturday. That means the company still has about 48,000 hourly workers, which is 7,500 more than its year-end goal of 40,500.
Left alone, it is going to be a long time before federal tax revenues recover. The implications on state spending, services, and taxes on productive members of society are ominous.
The U.S. will resemble a "banana republic" in 10 years if its fiscal situation stays on the same track, Sen. Judd Gregg (R-N.H.) warned Tuesday.
Gregg, the ranking member of the Senate Budget Committee, asserted that programs like "cash for clunkers" would pile up to as much as 80 percent of the total U.S. economic output because of federal spending.
"We're going to be like a banana republic in 10 years!" Gregg said during a panel discussion on CNBC. "Sure, Americans want the program. But if you stop and think about it, is it right to do for our children?"
Dear Fellow Patriots I hope you always consider the source when reading anything our government puts out. Keep in mind they have revised the manner in which they report so the reality is things are worse then they say. On to the story...
Personal incomes of U.S. residents fell 1.3% in June, reversing the 1.3% gain in May that was due to a one-time stimulus payment to Social Security recipients, the Commerce Department reported Tuesday.
Excluding the one-time payment in May, incomes fell 0.1% in June after a decline of less than 0.1% in May. Incomes are down this year despite the on-going prop to incomes from the stimulus, including tax credits and expanded unemployment benefits.
Half dozen economists who are very concerned about Federal Reserve independence what they thought about Rep. Ron Paul’s bill to audit the Fed.
This was my specific question: “Given that Congress can already grill
the Fed chairman during Humphrey-Hawkins (and occasional other
congressional appearances), how would a GAO really threaten Fed independence in practical terms?”
The GAO audit proposal is from Ron Paul, who
has advocated abolishing the Fed and returning to the gold standard.
Maybe people think that this is his foot in the door, a first step in
the plan. When King Louis 16 called for a meeting of the Estates
General in France, it led to a chain of events that resulted in his
beheading! [how is this on subject ED]
My view is that there is a major difference between general economic questions from Congress to a Fed that isn’t open to a GAO audit and that doesn’t get its budget from Congress, versus a detailed audit
b
Just as banks from JPMorgan Chase & Co. to Deutsche Bank Securities Inc. rushed to raise their forecasts for U.S. growth in coming quarters, Nobel laureate Edmund Phelps warned the economy is in for a “long slog.”
The divergence emerged after the Commerce Department said July 31 the economy has now contracted the most since the 1940s. Benchmark revisions to the department’s National Income and Product Accounts also showed consumer spending has tumbled 2 percent since the end of 2007, a magnitude unseen since the 1980 slump that ushered President Jimmy Carter out of office.
The deeper decline sets the stage for a faster recovery in the second half of the year, said Bruce Kasman at JPMorgan and Joseph LaVorgna at Deutsche Bank. It’s what comes later that worries Phelps and others, including Mark Gertler, the New York University economist who was a research partner of Ben S. Bernanke before he became Federal Reserve chairman.
“The increase of social wealth is not accompanied by a
diminished number of capitalist magnates, but by an increasing number of capitalists
of all degrees.” Eduard Bernstein “The interventionist policy [big
government] provides thousands and thousands of people with safe, placid and
not too strenuous jobs at the expense of the rest of society.” Ludwig Von Mises “There is a profound
contrast between the effect of foreign aid and of voluntary private investment:
Foreign aid goes form government to government.
It is therefore almost inevitably statist and socialistic.” Henry Hazlitt
Markit Group Ltd., the data provider majority-owned by Wall Street’s largest banks, is under Justice Department scrutiny for potential anticompetitive practices ranging from requiring customers to buy bundled services to restricting which trades can be cleared in the $26 trillion credit-default swap market.
The Justice Department said July 15 it was investigating users of credit-default swaps as U.S. lawmakers seek to regulate the $592 trillion over-the-counter derivatives market, which helped worsen the biggest financial calamity since the Great Depression. Trading in OTC contracts provides as much as 40 percent of profits for Goldman Sachs Group Inc. and Morgan Stanley, according to research firm CreditSights Inc.
“Markit has been informed of an investigation by the Department of Justice into the credit-derivatives and related markets,” spokeswoman Teresa Chick said July 13 in an e-mailed statement in response to questions from Bloomberg News. Chick declined to comment last wee
Friday’s GDP release was a sight for sore eyes. After experiencing sharp declines in the US economy for three consecutive quarters, the data for Q2 showed a decline of only 1% compared to the 1.5% that analysts were expecting. The news was enough to cause a number of economists to increase their forecasts regarding the “economic recovery” and was helpful in pushing stocks higher throughout most of the trading day.
A 1% drop is significantly better than the 6.4% drop we had in the first quarter right? Actually, the answer is NO! A drop is still a drop. Consider the fact that we had the worst decline in 27 years for the first quarter, and that in the second quarter we were still declining. It’s tough to find a silver lining with this dark cloud, but that doesn’t keep analysts from spinning it in order to attempt to prop up the equity markets. As Mark Twain so eloquently said, “There are three kinds of lies: lies, damned lies and statistics.” The point is that you can make statistics i
Other figures in an Associated Press analysis underscore the recession's impact: Individual income tax receipts are down 22 percent from a year ago. Corporate income taxes are down 57 percent.
Usually I don't talk about
this. About all I can do is watch events, recognize, identify,
and bite my tongue. Right now a war is raging,
a war over 100 years old, a war to suppress specie (gold and
silver) money and replace it with bank money.
It's easy to write off someone
like me as a monetary crank. After all, the federal government
was after him and there was a long trial and he was acquitted,
but you know, where there's smoke, there's fire. And then there
was a state trial, and he was convicted. Besides, doesn't he
know the economy and finance have progressed so much that they've outgrown silver and gold?
Unless you have ever been the
victim of a US government persecution (sic -- I did not
write prosecution), you cannot even dimly appreciate the
bloodthirsty viciousness of the US criminal justice system and
its thugs. They identify a victim,
What does all this mean? It means the consumer is down-for-the-count. His credit lines have been cut, his home equity eviscerated, and his checking account swimming in red ink.
The Extendees — which consists of soon-to-be-Exhaustees — gained 25k, raising the total unemployed receiving extended benefits to about 2.66 million people. One year ago, there were only 127 thousand receiving extended benefits.
Cash-strapped older Americans are racking up credit card debt faster than other consumers amid dwindling retirement portfolios and rising medical costs, a study shows.
But we do not have to go to Youtube to enjoy the Jackass genre. We have only to read the news. All over the world the authorities are strapping on their absurd parachutes…and climbing to very high places.
When job losses are severe enough, as they most definitely are now, the loss in purchasing power to the economy is so great that employment becomes a coincident and even a leading indicator. Simply put, people can't spend until...
The 0.5% GDP beat comes on top of a 0.9% downward revision. Hence, the net surprise was a compounded negative 0.4%. And that’s before the likely downward revisions to Q2 . . .
California's budget debacle holds a lesson for America, but one we will probably ignore. For years, state leaders papered over the contradiction with loans and modest changes. By overwhelming these expedients, the recession triggered an inevitable reckoning.
Here's the national lesson. There's a collision between high and rising demands for government services and the capacity of the economy How to produce the income and tax revenue to pay for those demands. That's true of California, where poor immigrants and their children have increased pressures for more government services. It's also true of the nation, where an aging population raises Social Security and Medicare spending. California is leading the transformation of politics into a form of collective torture: pay more (higher taxes), get less (lower services).
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