Retail sales:+0.6% in June to $342.1B, slightly better than +0.5% consensus, but -9% vs. a year ago. May unrevised at +0.5%. [View news story]
And even in the case of autos, the increase seems to have occurred in parts since the car sales were down from 9.9 (May) to 9.7 millions (annual rate).
Ongoing, Stealthy Deterioration of Asset Quality [View article]
Yes, deflation might result due to Americans saving a large portion of their earnings. However, we can also have inflation due 1) to the government's desire to placate high-cost organized labor constituencies and 2) the foreign lenders realizing that they are swapping their hard goods for the worthless dollar bills and the treasury bonds and refusing to lend further at reduced rates and 3) The general feeling among us that we all deserve (in salary and fringe benefits) much more than what we are really worth in this global competitive environment (All the government give aways via extended unemployment benefits, free medical care etc. are extending that myth!). The stock market still could go up as the extra money not going into government bonds might find its way there (and we are seeing the commodities play already).
Unemployment Data: Exhaustion Rate Will Soon Lead To False Green Shoot Chatter [View article]
Also, a free software called NetworkMiner lets you capture data that comes from the network as individual files.
On Jun 05 10:32 AM market mojo wrote:
> MWSnap is a free softare that you can use to take a "snapthot" of > anything on your screen including images on websites. > > You might be able to use it to snap the graphs from the Department > of Labor website.
Some Odd Stats in Pending Home Sales [View article]
Your alarms about debt as a GDP should become more louder when you realize that good part of our GDP has become so useless (like Realtors and their companies walking away with 6%; so much useless closing costs; retail jobs pushing Chinese made products; govt. and health care Or normalizing to purchase parity) that what is left to sell abroad to reduce our debt load is very small. I wonder how our children and their children would react when they get the bill!
On Jun 02 07:06 PM foobar wrote:
> > bankers selling our childrens futures..for more bailouts? the disgrace. > it's horrible. too big to fail needs to fail. we neeed LESS bailouts. > If you fail U fail. > > Total credit market debt as a percentage of GDP has risen from 130% > of GDP in 1952 to 350% of GDP today. The various bailout and stimulus > schemes enacted in the last year will drive this percentage above > 400% in the near future. When a country allows this much debt to > accumulate versus its GDP, they have done something seriously wrong. > The country’s politicians, business leaders, and citizens have all > contributed to this disaster. > > good articles: fly2.ws/9SdkpLU
It perhaps is good news for China and others that hold our Govt. debt and perhaps demanded by them (by increasing the existing bond value, we are giving them a short term opportunity to exit from our debt without making their value and the dollar plummet. Once that is accomplished, even if partly, they can think of letting their currency appreciate and hence get paid better for their merchandise). The savers in this country (via their retirement funds etc.) would be the buyers of these funds at reduced interest rates. In the long run, when inflation takes hold (foreigners not selling their goods for less price, our currency depreciation etc.), these bonds as well as our dollar would be worth less and we have to confine ourselves to our borders and U.S. made merchandise (at very high cost). Welcome to the future Communist U.S.A.
This may or may not be the bottom (markets don't go up or down monotonically, but is like a under-damped system, of course more complex nonlinear and time-varying, that keeps oscillating), but all the reasons given can be challenged easily: 1. This is not 74, 82 or 87 to use the PEs from those times. During those times, the country was relatively affluent (was it 1982 when we moved from most prosperous nation to the net debtor nation status?), had better industrial and man-power base and very little outside competition. Now a majority of us seems to be working in retail, hamburger flipping or serving coffee, housing and related activities (how many times your house title got verified or insured or paid closing costs and real estate agent commissions?) and health-care, none of which adds to true wealth that could be sold to outsiders. 2. The stock market might be cheaper with respect to the GDP, but a big chunk of it on useless work (you polish my shoe and I will polish yourself and both get paid. Perhaps I should not put this in writing and give new idea for the politicians to get extra tax - We should calculate the efforts by the housewives or husbands who work at home in terms of managing the house and bringing up the children, attach the proper cost to their efforts, and add it to our GDP!) and due to politicians with a law education (and who can't understand real manufacturing or economics) dictating that thou shall be paid a minimum of $8.00 per hour along with all the fringe benefits. 3. Gold is higher with respect to the stock market perhaps because folks realize that a) we might not go back to the mass production (that reduces cost and increases profits) and consumption binge that we were in during the last 25 years, b) the politicians want to avoid pain when it is due (they did not want to interfere in the market when the bubbles were developing and everyone went on an orgy), and c) the enormous printing of paper money that is taking place (many argue that since so much money is lost, this is fine. But this makes the assumption that the rest of the world would be foolish for ever to trade their real goods of hard labor for our paper). I will be personally happy if we can recover from this mess and avoid a possible civil unrest (it is always easy to accept going from poverty to richness, but the reverse is not). As a professor of engineering, I tell my students that perhaps the 1970-2000 was the golden period of this country and they got to work their butts off so that their children when they grow up can talk of a similar period in the future. Perhaps I am wrong and we all can have a good time doing the easy things.
As an Indian (in my previous life!) and as one who keeps an eye on what is happening there from USA (a bird's eye view), I agree that the higher price might be keeping them away from buying, but I feel that it could only be temporary (hope that the price will come down). On the other hand, the country is becoming richer (at least the 30% or 300 million as compared to USA where 80% seems to be living on loans which are getting scarce) and hence their expectations and purchases are going higher (for example, 30 years ago, 5 Oz of gold was deemed essential for a bride from middle class whereas now folks talk about buying 15 to 20 Oz for their wedding). Add to this the recently introduced American concept of buying with little down payment (NINJA loans! No, not there yet) or leverage, the demand has only to go up. Further, the rich have stashed away good part of their wealth (mostly stolen) in western banks or as western currencies (under their pillow - note that approximately 30% of U.S. dollars used to disappear from circulation here until recently) and once they realize the true value of these currencies, there will be a run to alternate means to store the stolen wealth and gold happened to be an excellent storage for long time for them and it may not change to soon.
When folks compare ourselves with Japan and declare we are better off based on the debt/GDP ratio, they forget an important point. Our economy has become too much of a hamburger and shoe polishing economy and to fat to make others interested in what we make. There is not much that we can sell to the outside world from this economy to pay down our debt (Look at our trade deficit which keeps hovering around 600 B$ per year; think of products that we can sell at the price the others want to close that gap. Not much). When the foreigners wake up to this fact, they will start running away from our currency and our bonds.
Twenty-Two Years of Job Creation Wiped Out in a Single Day [View article]
It is funny the author Mr. Fred Wilson is mentioning something I pointed out to the NSF management while a program director (a venture capitalist) 30 years ago. I used the export / import chart to show that the so called high tech had a surplus of 20+ billion even in good period whereas the non-high tech had a deficit of 200+ billions and pointing to south with an ever increasing slope and high tech alone cannot save the country. Of course, the folks were not willing to listen since they had a vested interest in pushing too ivy league / elitist solutions! I still have that chart on my computer of anyone wants to take a look at it.
Citigroup's Derivatives Reduce Bailout to a Non-Event [View article]
So, some one who is long on the stock can write positive articles about the company as it happens 90% of the time?
On Jan 04 11:50 AM joshchn wrote:
> why is someone who is SHORT on citibank allowed to publish an aritcle > bashing citibank ??? > > regardless of weather they disclose the fact-- its unfair and unethical. > > > he needs to stick to writing articles on other sectors- this man > gains by trying to get citibank lower-
You mention that the exports have increased by 16.1%. Still, our trade deficit goes down by a paltry 3% or so. At this rate it would require the dollar to fall by 50% to wipe out the deficit. Perhaps we have become too much of a hamburger economy that no one wants we produce!
The problem is not due to derivatives per se, but because of the way they are (poorly) designed. I am a senior Electrical Engineering Professor and let me explain using system theory concepts. When we design systems (like an airplane), we make sure that the system is inherently stable (under most strenuous circumstances). In a stable system, when something goes wrong, a counterforce(s) will come into effect to correct the situation. Unfortunately most (if not all) of the derivatives were not designed to such stringent engineering standards even with the presence of high caliber folks. A derivative based system is nonlinear (the response is not proportionate to the input magnitude), time-varying (users perceptions change fast), sampled-data or discrete system (where the required inputs or the real information is not coming continuously and timely fashion and hence confusion and wrong responses). Under such circumstances, it is very easy for such a system to crash (like 1987 or 1988 etc.). The engineers have not yet completely solved the problem of designing synthetic (I used the word synthetic to imply that we at least have control over such systems in terms of our expectations; we can make it simpler if that is all we can do) nonlinear, time-varying systems because of the complexities and hence try to solve one small problem at a time. The same thing could be said of medicine where the system (human body) is very complex and treatment for one ailment leads to some other problem (side effects). Then came these so called financial engineers with limited knowledge in complex NLTI systems but good access to real money and designed for quick bucks the so called derivatives. Add to it all the insider information that the average joe doesn't see. Bingo, we have a system which seems to work fine for some time (like Enron profit creation) and disintegrate quickly. In a stable system, for every loser there would be a gainer and it would be a zero sum game. Here with all the melt down, it looks like everyone is a loser.
Retail sales: +0.6% in June to $342.1B, slightly better than +0.5% consensus, but -9% vs. a year ago. May unrevised at +0.5%. [View news story]
Ongoing, Stealthy Deterioration of Asset Quality [View article]
Unemployment Data: Exhaustion Rate Will Soon Lead To False Green Shoot Chatter [View article]
On Jun 05 10:32 AM market mojo wrote:
> MWSnap is a free softare that you can use to take a "snapthot" of
> anything on your screen including images on websites.
>
> You might be able to use it to snap the graphs from the Department
> of Labor website.
Some Odd Stats in Pending Home Sales [View article]
On Jun 02 07:06 PM foobar wrote:
>
> bankers selling our childrens futures..for more bailouts? the disgrace.
> it's horrible. too big to fail needs to fail. we neeed LESS bailouts.
> If you fail U fail.
>
> Total credit market debt as a percentage of GDP has risen from 130%
> of GDP in 1952 to 350% of GDP today. The various bailout and stimulus
> schemes enacted in the last year will drive this percentage above
> 400% in the near future. When a country allows this much debt to
> accumulate versus its GDP, they have done something seriously wrong.
> The country’s politicians, business leaders, and citizens have all
> contributed to this disaster.
>
> good articles: fly2.ws/9SdkpLU
Friday Outlook: Commodities, Global Markets [View article]
The Fed Must Be Crazy [View article]
Barron's Calls a Bottom [View article]
1. This is not 74, 82 or 87 to use the PEs from those times. During those times, the country was relatively affluent (was it 1982 when we moved from most prosperous nation to the net debtor nation status?), had better industrial and man-power base and very little outside competition. Now a majority of us seems to be working in retail, hamburger flipping or serving coffee, housing and related activities (how many times your house title got verified or insured or paid closing costs and real estate agent commissions?) and health-care, none of which adds to true wealth that could be sold to outsiders.
2. The stock market might be cheaper with respect to the GDP, but a big chunk of it on useless work (you polish my shoe and I will polish yourself and both get paid. Perhaps I should not put this in writing and give new idea for the politicians to get extra tax - We should calculate the efforts by the housewives or husbands who work at home in terms of managing the house and bringing up the children, attach the proper cost to their efforts, and add it to our GDP!) and due to politicians with a law education (and who can't understand real manufacturing or economics) dictating that thou shall be paid a minimum of $8.00 per hour along with all the fringe benefits.
3. Gold is higher with respect to the stock market perhaps because folks realize that a) we might not go back to the mass production (that reduces cost and increases profits) and consumption binge that we were in during the last 25 years, b) the politicians want to avoid pain when it is due (they did not want to interfere in the market when the bubbles were developing and everyone went on an orgy), and c) the enormous printing of paper money that is taking place (many argue that since so much money is lost, this is fine. But this makes the assumption that the rest of the world would be foolish for ever to trade their real goods of hard labor for our paper).
I will be personally happy if we can recover from this mess and avoid a possible civil unrest (it is always easy to accept going from poverty to richness, but the reverse is not). As a professor of engineering, I tell my students that perhaps the 1970-2000 was the golden period of this country and they got to work their butts off so that their children when they grow up can talk of a similar period in the future. Perhaps I am wrong and we all can have a good time doing the easy things.
12 Reasons to Short Gold [View article]
This Is Just the Beginning [View article]
Twenty-Two Years of Job Creation Wiped Out in a Single Day [View article]
Citigroup's Derivatives Reduce Bailout to a Non-Event [View article]
On Jan 04 11:50 AM joshchn wrote:
> why is someone who is SHORT on citibank allowed to publish an aritcle
> bashing citibank ???
>
> regardless of weather they disclose the fact-- its unfair and unethical.
>
>
> he needs to stick to writing articles on other sectors- this man
> gains by trying to get citibank lower-
Keep An Eye On the Dollar [View article]
A Demon Of Our Own Design [View article]