ken3602

U.S. Economic Recovery and the Housing Sector Mirage

You've received some money from your parents(US gov), and they say everything will be alright, so you feel better enough to buy a new TV and even a new car which, by the way, seem to be a steal with current prices. Everything seems going well again right?

Please.

Consumers are not coming back. They are just.. stimulated and spending money they really shouldn't. This is practically what's got all of us here at the first place. Doing same thing all over again will never bring a different result.


On Nov 24 02:49 PM Annualgain wrote:

> "During the Great Depression it would have been plausible for the
> economy to “recover” even if employment, housing and consumer spending
> were all still in decline (as they are in the United States, today).
> However, the current U.S. economy is built entirely atop a housing-bubble,
> and a level of consumption which can only be maintained by ever-increasing
> consumer debt."
>
> Mr. Nielsen:
> The last time I commented on one of your articles, you responded
> and I think the tone between us became contentious. That is not my
> intention here, I really just want to learn from you and others.
> So here's my comment:
>
> How is the recent housing bubble so different from the credit bubble
> that brought on the great depression? Whether the borrowing was backed
> by houses or stocks, when the assets declined in value, all the loans
> were under water. Right?
>
> Now, here's where I think you and I might really differ in our views,
> i.e. the consumer debt vs. spending balance. Not only is consumer
> revolving debt down recently, total consumer borrowings are down
> in aggregate. At the same time consumer spending is increasing, albeit
> at an anemic rate.
>
> How can consumers pay down debt and increase spending at the same
> time? Well, despite the fact that the U.S. has more unemployment,
> personal income is increasing in aggregate. The reason we are going
> to have very very muted recovery in the U.S. is that consumers are
> putting some their income increase towards spending and some towards
> debt reduction.
> Consumer Loans: research.stlouisfed.or...
>
> Personal Income: research.stlouisfed.or...
>
> Personal Consumption Expenditures: research.stlouisfed.or...
>
>
> I don't disagree with the housing stats you provide in your article.
> I guess I just disagree with the interpretation.
>
> AG

Why a Market Crash Doesn’t Matter

Believing what used to work will work again is as dangerous as predicting what will happen in the future. It is very naive if someone thinks Lehman is the worst thing that could ever happen. If most of investors survive, that is not the worst thing after all. The worst is still yet to come. Fear is a good thing when the possibility of a disastrous thing to happen in a near future is quite high because you will prepare yourself for it rather than ignoring it completely.

Obama's Plan A Failed, But Plan B Looks Promising

You still live in 80s.... Consumers in Asian countries with a real purchasing power (e.g. China, Japan, Korea, etc) don't prefer goods made in USA simply because the goods are not superior anymore. With a couple of exceptions, the only way US can sell its products in Asia successfullly is by selling them in QTY at dirt cheap prices. Sound familiar?? So Obama's plan B is for US and China to switch their roles... Wonderful thinking.

What Happens If Roubini Is Right?

And, now is the perfect time for Tim and Ben to start strengthening dollar. They need good numbers (at least better than expected...) on consumer spending for the coming holiday season, and pulling gas price down is the easiest way to do so. If they fail to bring oil down below 60 anytime soon, they are in a big trouble.

Market: Spooked Today, But Panic Attack Is Likely Temporary

The market has been politically manipulated, and since this government needs a big holiday consumer spending so badly, Tim and Ben will pump up the dollar big time to bring gas price down for at least two months. If oil stays around $80, this holiday sales will be a horror movie, and it is the last thing Obama Administration would want. Dollar up, equity down.

Why Today's Stock Markets Are All About Confidence and Gullibility

That Abby Cohen's bold prediction is either a call which is similar to GS call of $200 oil when oil reached near $150 (last big push before dumping) or she lives with a very different sense of time (like her each second is much longer than others) which would make her feel last 5 months almost like 5 years.

Should Bernanke Be Reappointed?

"Here's the question I ask myself. If I were to suddenly come down with the same disease, would I want the current group with it's current leadership in charge of bringing me back to health, or would I want a different group led by someone new who thinks they know what to do, but has never actually been through it? I'd want this group, the one with experience."

With this logic, shouldn't we bring back all those CEOs of Countrywide, Bearsterns, Wamu, Merill, AIG, Citigroup, and Paulson (possibly Madoff too)? They have great experiences with current crisis. Why don't we give them a second chance to fix it??

Stocks Are Overvalued and Overbought

and the market keeps going up... I am personally fine with that since my long positions doing well with that, but it seems the time to seriouly build protection / hedging positions.

CIT Prepares to File for Bankruptcy

Please go back to yahoo.


On Jul 12 10:51 AM User 445849 wrote:

> Mr Durden-- What are your qualifications for writing investment articles?
> What is the rate of return on your portfolio over the past 1, 3,
> 5 years?

Bankers, The Spooks Want You!

Or... I have a second thought.
They will all pass the most vigorous lie detector test with no sweat, and everyone in CIA will start questioning the test. The result is same. No banker is hired for the moment...

Bankers, The Spooks Want You!

CIA will not be able to hire any of the formerly wall street bankers because 100% of them will fail the very first simple question on a lie detector test:

Would you work for your country in any circumstances?

Consumer Confidence Fading

I thought it would peak in May, but it did in June... It will tank from here to at least October.

Populism vs. Bernanke, Round Two

Problem with Bush was simple. His brain was simply not capable of processing/understanding complex issues. On the other hand, our current President Obama seems to fully understand core issues of many complicated problems we are facing. The only problem with him is that he is too smart (and even seems enjoying) in playing political games. This gifted ability to strategically place his next moves to win each game is unfortunately not necessarily the thing we need to solve this massive economic failure we are facing at this moment. His several smart moves could end up creating another catastrophe in a near future. I just hope he can foresee that doing the right things (and losing couple of games) will increase a possibility of bringing this country back on right track even if it could harm his political power of this day.

A Surprisingly Weak Market

I don't short individual stocks, but RIMM seems to be a good one to short.

Why the Recession Is Over

I can understand people who really believe that the recession is over now. They think it is another usual rainstorm while the fact is that we are in the eye of a massive hurricane.