The pathetic notion set forth by the National Bureau of Economic Research group that the recession has been over since 2009 can't even be taken seriously.
While they attempt to say they took other things into consideration, the key factor was the GDP. The problem and joke with that is throwing of money at the problem via the stimulus is included in the jacked up numbers of the GDP, giving the illusion of a recovery.
That's why when the gimmicks and money ran out, the naked economy was revealed to be what it continues to be: recessionary, and possibly heading to a depression.
The usual attempt to slap this type of garbage down by pointing to the obvious in relationship to no jobs being created is largely ignored, and simply identified as historically being a "lagging indicator." That was also said concerning the depressed housing market as well, among other lagging indicators.
Bizarrely they said the continuing downturn in the US could inflict long-term damage on the economy, resulting in long-term unemployment. All of this with no recession. Amazing how bad things can get in a "recovery."
One thing I do like that these people publicly stated was if there is an economic downturn, it'll be a new recession, not a continuation of the one that allegedly is over.
What time will surely tell - and hopefully will result in the removal of these people who aren't anybody from being taken seriously as economists - is the recession in fact never ended, and covering their rearends by saying if there is a new recession it's not connected to the old one, will expose their agenda and intentions.
That statement that if there is another recession it's a new one, is meaningless. We must accept their conclusion they're telling us, and they're actually trying to control the future outlook for the ongoing recession by saying it will be a new one.
In other words, it's an attempt to protect Keynesianism. If the stimulus is said to have failed, and the recession has continued on, it blows away the anemic economic theory on the spot, leaving even more confusion and needed explanations as to what is really going on.
The answer to economic weakness isn't the government or central banks, it's the removal of barriers to businesses and allowing the free market to thrive.
There can be no doubt we're still in a recession, and no manipulation of the numbers or data can change that fact. Happy days aren't here again, and there is no yellow brick road to follow. As a matter of fact we can rightly say, "goodbye yellow brick road."
Showing posts with label Housing Market. Show all posts
Showing posts with label Housing Market. Show all posts
Tuesday, September 21, 2010
Wednesday, August 25, 2010
Goldman Sachs (NYSE:GS) Says More Fed Stimulus Coming
According to Chief U.S. Economist at Goldman Sachs Jan Hatzius, the Federal Reserve will attempt to stimulate the economy as it continues to show it weakness.
Unsurprisingly, sales of previously owned homes in the U.S. in July, plunged to their lowest level in fifteen years, with a record drop of 27.2 percent. That works out to 3.83 million units sold annually.
June sales were downwardly revised to a 5.26 million-unit pace.
As a result, Hatzius said, “The Fed will eventually move to additional monetary stimulus via asset purchases or other unconventional measures.”
Probably one of most incredible statements made economically, is the casual assertion on what the figure should be. Hatzius concluded, “The Fed will eventually move to additional monetary stimulus via asset purchases or other unconventional measures.” In his mind, there is “no point in doing anything less than” $1 trillion.
Just a casual reference to throwing another $1 trillion of money the government doesn't own for taxpayers to have to pay in the future?
If the prior approximate $1 trillion didn't do anything, how will throwing another $1 trillion at the problem work? It won't, but it'll bring America all the closer to economic collapse than it already is.
It's no different than giving booze to an alcoholic to solve his problem. An addict can't be freed from addiction by imbibing more alcohol.
The outrageous hiring of more government workers and paying all those government employees over double what the private market makes is criminal. After all, who do you think ultimately pays for these high wages? Those who are productive.
How does the idea of adding stimulus play out within those parameters?
We must understand that the government can create nothing as far as wealth and productivity go. So when they spend, they're either taking from existing productive workers or from the productivity of future generations, which will in no way be able to pay back the spending excesses of this administration.
There will be a stimulus for sure, as the Federal Reserve has already stated they're ready to intercede again if the economy continues to weaken.
They must do that because the reasons behind their failure will be exposed, which is stimulus doesn't work, and only robs from the people of the country doing the stimulating.
If a trillion dollars hasn't already exposed that to you, I don't know how you'll ever be convinced until the word depression replaces the word recession as far as the reality we're all experiencing.
We're still in a recession, and the reason that's so is the GDP includes stimulus spending by the government, which is like taking a loan out and using it to buy stuff which produces nothing but consumption, but nothing in the business sector which will help in a sustainable manner.
The inclusion of stimulus in the GDP hides and masks this reality, the reason we hear people say the so-called recovery is slowing, when all it is is returning to its original condition before the stimulus.
Hatzius adds more bleakness to the economic scenario, saying unemployment will increase to 10 percent in 2011, up from the 9.5 percent now.
That seems to say the stimulus will be worthless, which would be true. It's best to let the market take care of these things, as it's much more efficient and will allocate financial resources to areas which will do the most good. Stimulus money doesn't do that, as the $1 trillion already spent testifies to.
Unsurprisingly, sales of previously owned homes in the U.S. in July, plunged to their lowest level in fifteen years, with a record drop of 27.2 percent. That works out to 3.83 million units sold annually.
June sales were downwardly revised to a 5.26 million-unit pace.
As a result, Hatzius said, “The Fed will eventually move to additional monetary stimulus via asset purchases or other unconventional measures.”
Probably one of most incredible statements made economically, is the casual assertion on what the figure should be. Hatzius concluded, “The Fed will eventually move to additional monetary stimulus via asset purchases or other unconventional measures.” In his mind, there is “no point in doing anything less than” $1 trillion.
Just a casual reference to throwing another $1 trillion of money the government doesn't own for taxpayers to have to pay in the future?
If the prior approximate $1 trillion didn't do anything, how will throwing another $1 trillion at the problem work? It won't, but it'll bring America all the closer to economic collapse than it already is.
It's no different than giving booze to an alcoholic to solve his problem. An addict can't be freed from addiction by imbibing more alcohol.
The outrageous hiring of more government workers and paying all those government employees over double what the private market makes is criminal. After all, who do you think ultimately pays for these high wages? Those who are productive.
How does the idea of adding stimulus play out within those parameters?
We must understand that the government can create nothing as far as wealth and productivity go. So when they spend, they're either taking from existing productive workers or from the productivity of future generations, which will in no way be able to pay back the spending excesses of this administration.
There will be a stimulus for sure, as the Federal Reserve has already stated they're ready to intercede again if the economy continues to weaken.
They must do that because the reasons behind their failure will be exposed, which is stimulus doesn't work, and only robs from the people of the country doing the stimulating.
If a trillion dollars hasn't already exposed that to you, I don't know how you'll ever be convinced until the word depression replaces the word recession as far as the reality we're all experiencing.
We're still in a recession, and the reason that's so is the GDP includes stimulus spending by the government, which is like taking a loan out and using it to buy stuff which produces nothing but consumption, but nothing in the business sector which will help in a sustainable manner.
The inclusion of stimulus in the GDP hides and masks this reality, the reason we hear people say the so-called recovery is slowing, when all it is is returning to its original condition before the stimulus.
Hatzius adds more bleakness to the economic scenario, saying unemployment will increase to 10 percent in 2011, up from the 9.5 percent now.
That seems to say the stimulus will be worthless, which would be true. It's best to let the market take care of these things, as it's much more efficient and will allocate financial resources to areas which will do the most good. Stimulus money doesn't do that, as the $1 trillion already spent testifies to.
Friday, August 6, 2010
Consumer Credit Drops as US Economy Falters
Government interference in the marketplace has hidden the true weakness of the U.S. economy, and the release of the census workers from their temporary jobs, underscored the reality of the ongoing recession, as 131,000 workers were laid off.
The so-called jobless recovery that never was, has caused consumer credit to drop for the fifth month in a row, this time by 0.7 percent in June, or $1.3 billion.
In April U.S. consumer credit plunged 6.4 percent, and in May it dropped another 2.6 percent.
The lack of job creation in the private sector continues to be the impetus behind consumers pulling back on going into debt, and there is nothing in the short term that indicates this will change; as a matter a fact it'll probably get a lot worse before it begins to turn around.
Picking and choosing the economy data to focus on no longer cuts it, as even at that it brought mixed outlooks, while those that understood knew it was far from mixed, but an outright sham as far as cherry picking what the media chose to emphasize when they reported.
Not only are payrolls weak, but the housing market is almost assuredly going to go into recession again, debt levels remain high, and we haven't even heard much lately about the projected disaster of commercial real estate for the second half of 2010, which could begin at any time, as far as focusing on the issue.
With a job market that could take years to turn around, and the same with housing and commercial real estate, one does have to ask what the optimism is all about.
I think we're going to find out the economic optimism is much ado about nothing.
The so-called jobless recovery that never was, has caused consumer credit to drop for the fifth month in a row, this time by 0.7 percent in June, or $1.3 billion.
In April U.S. consumer credit plunged 6.4 percent, and in May it dropped another 2.6 percent.
The lack of job creation in the private sector continues to be the impetus behind consumers pulling back on going into debt, and there is nothing in the short term that indicates this will change; as a matter a fact it'll probably get a lot worse before it begins to turn around.
Picking and choosing the economy data to focus on no longer cuts it, as even at that it brought mixed outlooks, while those that understood knew it was far from mixed, but an outright sham as far as cherry picking what the media chose to emphasize when they reported.
Not only are payrolls weak, but the housing market is almost assuredly going to go into recession again, debt levels remain high, and we haven't even heard much lately about the projected disaster of commercial real estate for the second half of 2010, which could begin at any time, as far as focusing on the issue.
With a job market that could take years to turn around, and the same with housing and commercial real estate, one does have to ask what the optimism is all about.
I think we're going to find out the economic optimism is much ado about nothing.
Thursday, June 17, 2010
Copper Prices Under Pressure
Copper prices are going to remain under downward pressure as housing markets in the United States and China are slowing down, causing copper demand to shrink some.
Companies like Freeport-Mcmoran (NYSE:FCX) will be under pressure as well, as those with heavy copper exposure won't have anything to celebrate for some time to come, as there's nothing to suggest new housing starts in the U.S. will start to rise any time soon, as the tax credit has now ended.
And the Chinese property market is being cooled off in order to battle a potential bubble in the urban areas of the country, making copper demand there slower than expected not too long ago.
So for now, copper prices should fall, or at best, remain level, as there's nothing to indicate demand will rise in the near term.
Companies like Freeport-Mcmoran (NYSE:FCX) will be under pressure as well, as those with heavy copper exposure won't have anything to celebrate for some time to come, as there's nothing to suggest new housing starts in the U.S. will start to rise any time soon, as the tax credit has now ended.
And the Chinese property market is being cooled off in order to battle a potential bubble in the urban areas of the country, making copper demand there slower than expected not too long ago.
So for now, copper prices should fall, or at best, remain level, as there's nothing to indicate demand will rise in the near term.
Monday, May 3, 2010
Australia the Next Housing Bubble?
Australia has been sitting down under on its own seemingly basking in it financial glory, as commodities drove the nation to solid performance while most other countries struggled.
That could soon end as housing prices in Australia grew to their highest levels in at least 7 years for the first three months of the year.
Ben Jarman, an economist at JPMorgan Chase (NYSE:JPM) in Sydney said this, “Today’s result will unnerve Reserve Bank officials, and if nothing else, add to the media fervor suggesting that a bubble is building in the housing market."
Thoughts are that will almost guarantee the central bank will increase interest rates at its meeting tomorrow.
Adding the 4.8 percent increase in house prices in the first quarter to the 5.2 percent increase in the prior quarter point to a very real threat, and now one solely fanned by the media. That gain equals about 20 percent on an annual basis, a cause for genuine concern.
Australia has attempted to successfully slow down the rise in housing prices by increasing interest rates at a steady pace, but that hasn't done the trick, although they hope that will change in the months ahead.
Add to this the increasing mood from China that they may be doing the same thing for the same reasons, which will result in lowering demand for some domestic goods and raw materials, and Australia could quickly go from a strong financial position to a very shaky one quickly.
That could soon end as housing prices in Australia grew to their highest levels in at least 7 years for the first three months of the year.
Ben Jarman, an economist at JPMorgan Chase (NYSE:JPM) in Sydney said this, “Today’s result will unnerve Reserve Bank officials, and if nothing else, add to the media fervor suggesting that a bubble is building in the housing market."
Thoughts are that will almost guarantee the central bank will increase interest rates at its meeting tomorrow.
Adding the 4.8 percent increase in house prices in the first quarter to the 5.2 percent increase in the prior quarter point to a very real threat, and now one solely fanned by the media. That gain equals about 20 percent on an annual basis, a cause for genuine concern.
Australia has attempted to successfully slow down the rise in housing prices by increasing interest rates at a steady pace, but that hasn't done the trick, although they hope that will change in the months ahead.
Add to this the increasing mood from China that they may be doing the same thing for the same reasons, which will result in lowering demand for some domestic goods and raw materials, and Australia could quickly go from a strong financial position to a very shaky one quickly.
Thursday, April 15, 2010
Labor, Housing Data Show Economy Still a Disaster
Data released concerning labor and housing confirm if we're in a recovery, it's now one that's sustainable, as another 24,000 applied for unemployment benefits for the first time and 35 percent more homes were foreclosed upon than in the same quarter last year.
So now we have a so-called jobless and foreclosure recovery.
As far as the jobless claims, every time we hear the numbers now the inclusion by the mainstream media is that it was unexpected. Well how come it's not unexpected to me and others, and I state it before it happens to confirm that.
Either productivity is so high with businesses that it's unprecedented, or the numbers are again being massaged to say what the Obama administration wants them to say.
Foreclosures reflect the weak housing and job market, while the job market reflects the fact that there is little hiring going on, if any at all, other then isolated instances.
I'm not convinced we're even out of a recession, let alone started on the road to recovery. Just because we hear some positive earnings reports doesn't mean a thing in relationship to the state of the U.S. economy, all that means is a lot of company continue to cut costs, not that they're able to raise margins to generate more profits from increased business.
There's nothing unexpected about any of this, and it will continue on for at least a year or more before there is really an turnaround, if it comes at all within that timeframe.
So now we have a so-called jobless and foreclosure recovery.
As far as the jobless claims, every time we hear the numbers now the inclusion by the mainstream media is that it was unexpected. Well how come it's not unexpected to me and others, and I state it before it happens to confirm that.
Either productivity is so high with businesses that it's unprecedented, or the numbers are again being massaged to say what the Obama administration wants them to say.
Foreclosures reflect the weak housing and job market, while the job market reflects the fact that there is little hiring going on, if any at all, other then isolated instances.
I'm not convinced we're even out of a recession, let alone started on the road to recovery. Just because we hear some positive earnings reports doesn't mean a thing in relationship to the state of the U.S. economy, all that means is a lot of company continue to cut costs, not that they're able to raise margins to generate more profits from increased business.
There's nothing unexpected about any of this, and it will continue on for at least a year or more before there is really an turnaround, if it comes at all within that timeframe.
Tuesday, March 16, 2010
NAHB/Wells Fargo (NYSE:WFC) Housing Index Drops
Housing Index Drops
Competition from low-priced foreclosures resulted in the monthly NAHB/Wells Fargo (NYSE:WFC) falling by two points to 15 in March so far, crushing analysts' expectations it would rise to 18 rather than fall.
Expected sales dropped from 27 to 24; buyer traffic fell from 12 to 10; and current sales plunged from 17 to 15, of the three components used to track the home builders' health.
This follows in the footsteps of the February report which enjoyed a temporary increase.
Housing Index Drops
Competition from low-priced foreclosures resulted in the monthly NAHB/Wells Fargo (NYSE:WFC) falling by two points to 15 in March so far, crushing analysts' expectations it would rise to 18 rather than fall.
Expected sales dropped from 27 to 24; buyer traffic fell from 12 to 10; and current sales plunged from 17 to 15, of the three components used to track the home builders' health.
This follows in the footsteps of the February report which enjoyed a temporary increase.
Housing Index Drops
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