A survey released by the National Association of Business Economists found a strong majority of rear-view economists believe we have seen the worst of it: "The great recession is over", NABE President-Elect Lynn Reaser told Reuters. The report adds that the US dollar has lost about 5.8 percent of its value against a basket of currencies so far this year. I guess it is all downhill from here. Put your worries in the recycle bin. On the other hand ...
A September report from the Center on Budget and Policy Priorities shows a cumulative FY 2010 budget gap for all states at 24.3 percent. Since the recession is over, consumers will bridge that gap. California leads the nation with an astounding 49.3 difference between projected revenue and spending. Florida's gap is only 22.8 percent. Get out there and spend; isn't that the message? "California’s problems, while somewhat unique and self- inflicted, are really America’s problems,” said Bill Gross, co-chief investment officer of the world’s biggest bond fund wrote on Oct. 1. State and federal lawmakers, unable to comprehend the extent of consumer borrowing, “reflect a lack of vision to perceive that the strong growth in revenues was driven by the same excess leverage and the same delusionary asset appreciation that was bound to approach cliff’s edge.”
In the New York Times on Sunday, business writer Gretchen Morgenson approached the same issue, from a different place on the cliff; questioning the lack of integrity in municipal bond rating agencies, like Moody's, that rarely review initial judgments on bonds. "The increased complexity of municipal issuers' financing methods also makes it tough to analyze their bonds." Morgenson singles out the use of derivatives to insure municipal bond debt: Keeping track of which issuers are using such derivatives "would be a Heruclean task." In other words, it is not getting done any more than states or municipalities are balancing their budgets.
But never mind: with unemployment rising into double digits, the homeless popping up in droves, and housing markets bumping along a bottom thanks to sales of homes in foreclosure, the good news is that the recession is over. The Dow is pushing to 10,000. Phew, I was waiting for that.
Question: is the rising price of gold correlating with increasing homeless, a lagging economic indicator?
10 comments:
We live in the age of big lies. Rather than deal with the economy at the foundations (debt) just talk it up. Pass off bogus "Stress tests" and suspend key FASB rules. Create the illusion of prosperity and recovery to convince the huddled masses of "consumers" (no citizens needed) that they're now ready to go out and take on more debt. Then, manipulate key economic data (unemployment, GDP, inflation) to show what you want it to show, knowing full well that the otherwise unemployable liberal arts innumerate J-School idiots in the media will pass the numbers to the consumers without any criticism. Focus on the DOW as an indicator of economic health and pump trillions of monopoly money into equity markets to force the DOW up (in nominal terms). Dollar is down 16% against a trade weighted basket of currencies since March 9th. Oh, never mind. Lots of nations have printed their way to wealth.
This works until it doesn't. Alt-a and option-arm blowup is in the pipeline, and CRE is a slow moving disaster. This will work until it doesn't.
Sounds right to me.
http://www.shadowstats.com/article/consumer_price_index
Listen -- why worry?
When have these economists ever been wrong?
For the unemployed this is a depression.
It's nothing more than a confidence game. Economists at the higher end of government will never go against the grain.
We will continue with our depression when firemen with high school diplomas make $300,000 per year and school teachers and social wokers who made $33,000 per year are now unemployed.
Buy LOW. Sell HIGH. Follow Finance 101 & you will make a killing!
It takes about 10-20 hours to read Finance books to understand asset cycles. LIKE DUH? I have a degree in Finance & 2nd Major is Real Estate. Took 4 semesters of Calculus! All wasted. Just be an expert of IRR and FMRR via Hp financial calculators & then study the "asset cycles" of real estate in your state. I made on average 1165% gross profit per deal in the last 198 escrows from 2000 to 2007. But you can make $ if you use the calculator and cycle charts for your state and city.
Buy low? Not a problem.
Sell high? Problem.
While governments pay $1 of every $4 to $5 they take in on employee pensions we will remain in a depression.
When elected officials are too weak to say No! we will remain in a depression.
Post a Comment