Show-me Account Talk

[Show-me]

http://www.youtube.com/watch?v=zEuAVgmWt0U

 

[Show-me]

In "This Time Is Different," economic professors Kenneth Rogoff (Harvard) and Carmen Reinhart (Maryland) examine eight centuries of financial crises, demonstrating how the credit crunch of 2008 wasn't so unique, after all. That's the good news.
The bad news is Prof. Reinhart believes the current environment most closely resembles the Great Depression, specifically because of the global nature of the downturn and its severity. To keep the nascent recovery alive and avoid a similarly prolonged economic malaise, policymakers must refrain from "declaring victory prematurely" and reign in the stimulus too soon, says the former IMF economist. "That's a real danger here."


As to the question of whether policymakers really have learned the lessons of financial history, Reinhart gave a two-part answer:

• Monetary policy: She gives high marks to Ben Bernanke's Fed for acting aggressively in responding to the crisis - at least after Bear Stearns' collapse in March 2008. (As an aside, Reinhart was Bear's chief economist in 1985-1986.)
• Bank restructuring: Here, Reinhart gives policymakers "low marks" for failing to deal head on with toxic assets. There's "a lot of denial" in the approach to the banks, she says, seeing comparisons to Japan's post-bubble policies of delaying write-downs, which created zombie banks. "I'm not seeing a great deal of learning," the professor says, suggesting the policy response recalls Einstein's definition of insanity: Doing the same thing over and over and expecting a different outcome.

http://finance.yahoo.com/tech-ticke...Z,EWJ,BAC,C&sec=topStories&pos=9&asset=&ccode=

 

[Show-me]

Study: Amtrak loss comes to $32 per passenger

Analysis indicates that Amtrak understated losses on passenger service for most routes

• By Kevin Freking, Associated Press Writer
• On 6:14 am EDT, Tuesday October 27, 2009

WASHINGTON (AP) -- U.S. taxpayers spent about $32 subsidizing the cost of the typical Amtrak passenger in 2008, about four times the rail operator's estimate, according to a private study.

Amtrak operates a nationwide rail network, serving more than 500 destinations in 46 states. Forty-one of Amtrak's 44 routes lost money in 2008, said the study by Subsidyscope, an arm of the Pew Charitable Trusts.

Stephen Van Beek, president of the Eno Transportation Foundation, a think tank, said the analysis could help guide decisions on how to spend $8 billion set aside for high-speed and intercity rail in a $787 billion economic stimulus bill. Rail planners may decide that spending the funds on high-speed rail makes more sense than slower intercity rail, which the Amtrak numbers show need higher subsidies.

http://finance.yahoo.com/news/Study...84.html?x=0&sec=topStories&pos=8&asset=&ccode=

 

[Show-me]

Gov't may say recession over but not job losses

The recession may be officially over, but recovery is fragile and job losses still mounting

• By Tom Raum, Associated Press Writer
• On 6:24 am EDT, Tuesday October 27, 2009

WASHINGTON (AP) -- It's about to become official: The recession is over -- but not the pain.


The government will release figures this week expected to show that the economy has awakened from its deepest slump since the 1930s and is in the early stages of a recovery. But the following week, the government will issue another set of figures expected to show unemployment continuing to rise toward and possibly above a clearly recessionary 10 percent.

How can both be possible?

The government releases third-quarter Gross Domestic Product figures on Thursday. Many forecasters say they will show GDP growing at an annual rate of about 3 percent, validating a widely held belief among economists that the recession ended in June or July.

But try telling that to the more than 15 million still unemployed, the small businesses and individuals who can't get loans and the people whose homes are worth less than their mortgages.

http://finance.yahoo.com/news/Govt-...88.html?x=0&sec=topStories&pos=7&asset=&ccode=

 

[Show-me]

US Steel posts 3rd straight quarterly loss

US Steel reports another quarterly loss amid continuing weak demand, forecasts better results

• By Daniel Lovering, AP Manufacturing Writer
• On 7:40 am EDT, Tuesday October 27, 2009

PITTSBURGH (AP) -- United States Steel Corp. said Tuesday it lost money for a third straight quarter as the global economic downturn continued to dampen demand for the metal.



But the company said its steel production and shipments rose significantly, and that it expects improved results in the fourth quarter. Still, it forecast another loss for the October-December period.
The loss highlights an industrywide slump in demand that began when the world economy faltered late last year. That undermined key customers in the construction, auto and industrial equipment industries. Steel makers like U.S. Steel, based in Pittsburgh, responded by winding down production and laying off thousands of workers.

http://finance.yahoo.com/news/US-St...html?x=0&sec=topStories&pos=main&asset=&ccode=

 

[Show-me]

Really look at the balances and how much the payment are going to jump. Look at how the middle and top tiers are moving up. The top tier is spiking. Look at the cash Wells has on hand. What does that tell you?

 

[Show-me]

Whore it out!

Treasury prices rose Tuesday as the government prepares to offer $44 billion worth of 2-year notes as part of a record weekly debt sale.



The government is selling $123 billion worth of Treasurys this week to help fund its economic stimulus efforts and service a growing budget deficit.

http://finance.yahoo.com/news/Treas...09.html?x=0&sec=topStories&pos=4&asset=&ccode=

 

[Gumby]

Treasury prices rose Tuesday as the government prepares to offer $44 billion worth of 2-year notes as part of a record weekly debt sale.

Relax....That is only an annualized rate of 2.28 Trillion $$$$$$.
How sustainable is that.
But what the heck...when you are able to use freshly printed money you can buy all the treasuries you want at any price.:nuts:

 

[Show-me]

U.S. Foreclosure Rates Surge as Unemployment Continues to Rise

U.S. Foreclosure Rates Surge as Unemployment Continues to Rise

The top states with the highest foreclosure rates continue to be Florida, Nevada and California, although some areas within these states did see some foreclosure filing decline. Still, that’s increasingly being seen has a very temporary situation based on loan modifications, which is only prolonging the pain of many because the economy isn’t improving at all and unemployment continues to grow.

This is only going to get worse because of the legally mandated resets of mortgages about to come due over the next couple of years, and which will really hit hard in the first part of 2010. The report already confirms this has began to happen, as 50 of the metropolitan areas with the highest foreclosure rates have already experienced sharp rises in filings over the last 90 days, and that shows no signs it will abate any time soon.

Some of these cities include Salt Lake City and Boise City-Nampa, Idaho area, which had the largest increases in foreclosures of the top 50 metro regions.

With rising unemployment and mortgage resets about to hit in big way, the pain for the American people will continue on, no matter what the government line on being in a recovery maintains. This doesn’t even take into account the coming fallout of commercial loans which are projected to be huge and to explode in the second half of 2010.

For the banking industry, it remains to be seen who is most vulnerable and how it will effect the bottom line. But any way you look at it, the hoopla of record profits and all of that isn’t going to last long, and the reality will hit hard as the story of the real condition of the banking industry emerges in 2010, and it isn’t going to be pretty.

http://www.americanbankingnews.com/...ates-surge-as-unemployment-continues-to-rise/

 

[Show-me]

I missed the entire days action and I'm glad. I fell through my ceiling today right before I started blowing in 80 bags of insulation. Only took out one full sheet of drywall, my good knee with shin, my pride, and the family jewels, which saved me from hitting the floor. Just thought I'd share, I felt like a idiot and needed a good confession. :nuts:

If you go to my pics and look at the one of me having a cup of coffee. That is about where I landed. lol

Not looking good for the charts folks. Look out below.

 

[Gumby]

I missed the entire days action and I'm glad. I fell through my ceiling today right before I started blowing in 80 bags of insulation. Only took out one full sheet of drywall, my good knee with shin, my pride, and the family jewels, which saved me from hitting the floor. Just thought I'd share, I felt like a idiot and needed a good confession. :nuts:

Show-me

Glad you didn't get hurt seriously. My dad always told me the fall won't hurt...but that sudden stop will.

 

[Show-me]

Gumby,
My shin bore the brunt of the sudden stop. Everything will heal but the drywall, it died at 0900 this morning. lol

 

[Buster]

Most importantly..How are the Jewels?

 

[Show-me]

Just slightly grazed, just enough to cause very noticeable pain.

 

[Show-me]

http://stockcharts.com/h-sc/ui?s=$TRAN&p=D&yr=0&mn=6&dy=0&id=p26694867262

Double top?

 

[Show-me]

Catching Argentinian Disease by John Mauldin

Let's look at some quotes from Ferguson (emphasis mine):

"The economic history of Argentina in the twentieth century is an object lesson that all the resources in the world can be set at nought by financial mismanagement... To understand Argentina's economic decline, it is once again necessary to see that inflation was a political as much as a monetary phenomenon...

"To put it simply, there was no significant group with an interest in price stability...

"Inflation is a monetary phenomenon, as Milton Friedman said. But hyperinflation is always and everywhere a political phenomenon, in the sense that it cannot occur without a fundamental malfunction of a country's political economy."

Look at the chart below. Using realistic assumptions, It suggests that the annual US government fiscal deficit will approach $2 trillion in 2019. How can we come up with what looks to be about $15 trillion over the next ten years? The Argentinian answer was to print the money.

http://www.safehaven.com/article-14891.htm

In the US, the short answer is that unless the US consumers become a massive saving machine, to the tune of 8% or more of GDP and rising each year, and willingly put their savings into US government debt, it's not going to happen. So sometime in the coming years, interest rates are likely to start to rise in order to compensate bond investors for what they perceive as risk. That will bring us to some very difficult and painful choices.

As I wrote a few weeks ago, this scenario could be averted IF the Obama administration produced a credible plan to lower the deficit over time and stuck to it. But today's thought process is about what happens if they don't.

Ferguson pointed out in the quotes above that hyperinflation is always and everywhere a political decision. Governments have to choose to print money. In theory and in practice, what would happen if the Fed decided to accommodate a politicized US government that wanted to spend money on favorite projects and support groups, maybe even deserving programs like health care or defense or pensions or Social Security? Money they could not borrow?

Then Peter Schiff and like-minded thinkers would be right. Once you start down that path, it is hard to stop short of the brink. Brazil got to 100% inflation per month and has really lowered that level over time, but it is not easy.

In such a scenario, you want to own hard assets. Gold. Foreign currencies. Stocks. Almost anything other than the currency that is being printed.

 

[Bullitt]

Unless the US consumers become a massive saving machine, to the tune of 8% or more of GDP and rising each year, and willingly put their savings into US government debt, it's not going to happen.

But can any politician afford to be the one who allows this to happen? "Not on my watch!" is the best leadership quote these guys can think of. This administration has pretty much told the consumer, "You spend your money on buying 'stuff' and we'll spend our money buying up treasuries." The US Government has been the market for treasuries in 2009. Most people believe that this trend cannot be sustained and that higher interest rates lie in the near future.

You figure, we're at what, .5% right now? If we were to raise interest rates a mere 1%, that would be over a 100% increase in the cost to borrow. Can Joe the Plumber afford such a thing? Keeping up with the Joneses is killing us.

 

[Show-me]

Hi Bullitt,

It is a tight walk for politicians. They like having the people totally dependent on government and need to at least make the economy look like it is improving. They keep digging the hole deeper to appease the voter and the contributers. The problem is they will run out of other people's money and the printing press at Treasury has major repercussions.

 

[Show-me]

Geithner: Recovery could be 'a little choppy'; real test is unemployment coming down


On 12:50 am EDT, Sunday November 1, 2009

WASHINGTON (AP) -- Treasury Secretary Timothy Geithner says the economic recovery "could be a little choppy" and it's going to take a while.

Geithner told NBC's "Meet the Press" that bringing back jobs and the confidence of investors will be the real test of recovery. He declined to say whether the recession is over, saying economists will figure that out years from now.

Recent encouraging news in the economy "shows that -- when you act with force -- you can stabilize a crisis like this," he said in the interview that will air Sunday.

"But this is going to be a different recovery than in the past because Americans are going to have to save more. A lot of damage was caused by this crisis. It's going to take some time for us to grow out of this.
"It could be a little choppy. It could be uneven. And it's going to take awhile."

He noted, however, that he's seeing encouraging signs.

An excerpt of the interview was released Saturday night.

Don't care for the man, but +1 for the comments in red. It was the first time I felt like one of the folks at the top was not cheer leading and spinning.

 

[Show-me]

http://www.bloomberg.com/apps/news?pid=20601103&sid=a3.t_GrxbL2U

CIT took a dump on the shareholders and taxpayers.