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However, with domestic light truck sales down nearly 60,000 units and truck imports up just over 10,000, it's more accurate to describe this as a drop in big-vehicle sales overall.
I'd say he has it pretty much 'right on' with that. The only question would be how well are say the Toyota big trucks doing against 'plan' vs domestic mix. My guess is all are off but I don't know that, just guess.
Dave Altig is cheered by the June ISM report and is looking ahead to a better second half of the year. But the quarter just ended is unlikely to be a good one.
Gee, where ahave I heard that one before? The tech sector the last 3 years?
pennies on the dollar
FT.com / UK - Buyers avoid Bear Stearns' cut-priced sale
Anonymous' FT article..
"Investors in the worse-hit of two stricken Bear Stearns hedge funds are offering to sell their holdings for as little as 11 cents on the dollar but still finding no buyers, according to unfilled trades on Hedgebay, a secondary market for funds.
Vulture funds and others have been quick to bid for holdings in the two funds, but the best bid for Bear Stearns High-Grade Structured Credit Strategies Enhanced Leveraged Fund, the more geared of the two, is just 5 cents on the dollar."
...
"Bankers said initial valuations of the Enhanced Leverage Fund's assets indicated a strong chance that investors' cash had been wiped out. Estimates for the less-geared older fund suggest it has enough to underpin the $1.6bn rescue loan and leave about $400m for investors." ...
Ouch. Looks like Hedge Fund investors are about to get their investments trimmed. So much for risk free investment.
I wonder how long we'll need to wait to see how many of these investments are from pension and mutual fund managers. Three to six months before the losses start showing up on the fund reports?
OT: Ripple effect from subprime borrowing spotted on the horizon.
From the San Jose Mercury News:
Lower taxes for 17,758 Santa Clara County property owners - San Jose Mercury News
" Nearly 18,000 property owners in the county will receive tax breaks this year - nearly three times the number who got them last year - because their real estate values have fallen, even though the total assessed value of property in Santa Clara County rose.
As the residential real estate market cooled and the commercial sector heated up, the total assessed value of property in Santa Clara County has grown 8.25 percent this year, to a record $283.51 billion, county Assessor Larry Stone said Tuesday.
The county's assessed value includes the worth of more than 450,000 parcels of residential and commercial/industrial real estate as of Jan. 1, as well as the value of "business personal property," which includes things such as companies' machinery, computing equipment and office fixtures. Stone said this year's growth rate exceeded his projection, which was for an increase of up to 7.5 percent. Last year's increase was about 9 percent.
But a rising property value for the county as a whole doesn't mean all homeowners fared as well.
Many home buyers who purchased homes at the top of the market in 2005 using no-down-payment adjustable-rate mortgages, for example, have little equity in their homes and cannot refinance under the same loose criteria that many lenders were using two years ago. Those in distress need to sell. But many first-time buyers either are unwilling to buy in a soft market or can't qualify for no-money-down loans - and the slack
demand further diminishes home values.
Against that backdrop, Stone's office reduced the assessed values of 17,758 properties this year, up from just 6,503 in 2006. Of the properties identified for lowered assessments - known as Proposition 8 reductions - 95 percent were residential parcels.
"These were properties that were bought at the top of the market," Stone said. "An additional impact was the subprime lending activity.""
And if commercial real estate starts to cool down, too, it is trouble for local tax bases. Double trouble in California, where the legacy of Prop 13 severely limits the ability to raise property tax rates.
If these people would just read calculated risk this would not have been a surprise-
U.S. consumers are struggling; signs are all around Capitol Report - MarketWatch
China-made Chryslers by 2010
The first cars made by Chery could hit North America, Europe and other major automotive markets within three years.
CNNMoney.com: 404 Page Not Found
The first exports will be a Dodge model, but will not be to the U.S. or Europe.
"The first product within one year, and then into the United States and Western Europe within two to three years," Chrysler Group Chief Executive Tom LaSorda told reporters Wednesday at a ceremony marking the strategic alliance.
And on Friday, the government will report on job growth in June. All the indications point to another healthy increase of about 130,000 in nonfarm payrolls, while the jobless rate is expected to remain at a very low 4.5%.
As long as consumers are working, they'll keep spending.
All prior data conveyed earlier in the article aside.
So what's the over/under on all these "jobs" coming from the B/D model, 125%? I'll take the over.
This is just beyond comprehension-
"The margin losses mean that investors not only lost their funds, but could owe money that was borrowed to trade in their accounts. Blum said he talked with one client Tuesday who has about $12 million in margin losses."
Topic Galleries -- South Florida Sun-Sentinel.com
More from the above (Brookstreet debacle) "Fisher initially invested $410,000, then $50,000 and later $60,000. Her father invested $50,000. She was receiving monthly income of about $4,000. Fisher now thinks that money was being paid out of her principal and that the vast majority of her investment is gone."
"Now, Dr. Minsky, could you explain once more why you decided to name this phase of the economy "Ponzi" finance...
rc,
So, who are the bagholders on all that margin debt? Certainly not Brookstreet, and I doubt their investors have it. Even if there are deep-pocketed investors, everything would likely be tied up in lawsuits indefinitely.
losses start showing up on the fund reports?
--Andrew | 07.04.07 - 4:30 pm | #
CENSOR ALERT
pls refer to the OCC
And.....
another hedge fund is down!
This is starting to get nasty-
Funds Accelerate Subprime Exit Strategy - WSJ.com
As long as consumers are working, they'll keep spending.
Yep. But with the MEW gone they'll be spending their money on monster mortgage payments, not plasma TVs and dinners at the Cheesecake Factory.
It's nice that cheap corporate credit is causing business sector activity to pick up, but with cheap consumer credit disappearing, I wonder who's going to buy the stuff they make.
The only people who pay attention are in the bond world:
LBO Debt Alarms Fidelity, Lehman, TIAA-CREF Managers (Update2) - Bloomberg.com
Ten-Year Bonds `Not a Happy 4th July Picture,' Says Citigroup - Bloomberg.com
I am surprised by the tone in Yal's Bloomberg articles. This is spilling into CLOs quite readily.
A friend stood in line for 3 hours Monday to get his Iphone. The lady in line tells him that her son just turned 21 and she wanted to get him something very special but she didn't have any spare cash....problem solved with a quick withdrawal from her Roth IRA. Stunned but not surprised.
On March 15, federal agents raided his home in an affluent section of the capital. There they found about $205 million in CASH
those are some stupid agents
or,
they really found 300 million !
The New York Times - Breaking News, World News & Multimedia
only Zhenli Ye Gon knows for sure
Car sales down, isn't that good news? Doesn't that mean prices will decline and inflation is thus tamed?
What am I missing here?
yal, nice links.
was wondering if LBO was a play on stick it to the saver (bond buyer)...in inflationary outcome (w/dollar weakened) would make that deal a good deal. Those ~2/3 rd of borrowed dollars would lose real value fast in this play.
only Zhenli Ye Gon knows for sure
CB - the Federales making 'that find' wouldn't dare touch a penny (or centavo) of that loot without prior permission... If they stumbled on a small find (say a few hundred thou or so) from a non-influential crook, sure they take it, but not that much, not that visible. It would be missed, folks would notice. Important folks too.
Something weird is going on. No way a guy like Zhenli moves that much product (raw material like pseudophed that requires further processing no less) & sits on that much cash does so without high placed officials being in on it. VERY high placed officials too.
So why bust him?
I can guess why they might want to 'roll him up'... he's probably creaming too much & they want a more responsible 'manager' in place.
But if so - why let him run & talk? He should already be quietly swimming with the fishes... There must be more than one group looking for him & looking out for him else he'd already be dead and no lawyers (whether in NYC or MC) would take interest in being his spokesman.
Also note how the article says Zhenli wasn't there at the time of the raid & not in custody? But family members were taken instead. They got hostages. Before he talks he'll have to think carefully.
There is a lot more to this story than what's in print.
OT but interesting.
"Car sales down, isn't that good news? Doesn't that mean prices will decline and inflation is thus tamed?"
Price inflation is not the same thing as inflation of the amount of money in the world.
You can have price deflation and increases in the amount of money in the world.
This is not a mysterious relationship.
If prices decline and recession becomes likely more money is created to allow credit to be easier to soften the blow of the developing recession.
The world is awash with easy credit and consequently awash with easy money or liquidity. Money is not tight.
Price Inflation is therefore the predominant policy concern simply because of the amount of money that is being created to avoid a deflationary event which is happening anyway and spilling out of the areas where easier money is helpful. Hyperinflation beckons.
what to do?
Credit was expanding at a reckless pace because it was perceived that in no circumstances would there be sufficient tightening of money that lending would become risky.
It was then indicated that credit was going to tighten and an overinflated ballon began to deflate.
You now have the situation of a more or less still fully inflated balloon that cannot be pumped up any higher unless structural changes happen to allow the balloon to enlarge. This balloon is beginning to deflate even as more money is being pumped into it. This more or less equilibium position can be maintained or be controlled providing lenders are happy to carry on lending.
So lenders need to feel confidant that in no circumstances will there be further deflation of the money supplies ability to stimulate the economy in an expanding direction.
Are falling car prices a good sign?
Depends. If you take out a premium rate car finance loan and the car falls in value you might not think so at all. Neither might the lender.
Goldman Sachs Group Inc., the world's biggest securities firm, yesterday said the value of its collateralized debt obligations, securities backed by bonds and loans, dropped $1.56 billion, or 29 percent, to $3.79 billion in the second quarter. Goldman's fixed-income revenue fell 24 percent because of home loan delinquencies, the New York-based firm bank said in its quarterly filing with the Securities and Exchange Commission.
Bond Risk May Soar in Europe on Subprime Losses, UniCredit Says - Bloomberg.com
Is this Goldman news an earthquake ?
29%, 24% sounds a lot.
This is another drop in the subprime ocean
minimalizing
brushing off
disregard