40-6B \t[html][text] 1 KB \t[Paper]Application for exemption from all provisions of The Investment Company Act of 1940 by an Employee's Investment Company
Acc-no: 9999999997-08-029304 (40 Act)
Bailout driven equities market. Think the market likes this ?
[Sen. Christopher J. Dodd, D-Conn., the Banking Committee chairman, said that could be the death of the measure.
"Getting back on the floor again with a matter like this gets hard," Dodd said. "If you don't seize the moment when you have the opportunity to get something done like this, you can lose it."]
Inventory of 10.9 months, the same as for new homes. My feeling is that by the end of this year, we're going to be seeing over 12 months supply, as shadow inventory begins to appear.
4.49 million homes for sale, down very slightly from the all-time high of 4.561 million in July 07, and 4.552 last month (Apr 08).
Obscene that the media still reports MOM increases as headlines when YOY sales are cliff diving.
I agree. And I also remember when this thing was just getting rolling that they used the YoY comparison when the MoM were showing the beginnings of a downturn.
I was reflecting on something related this morning... A market analyst I admire once remarked that back in early 1982 - right before the great two decade bull market in U.S. stocks began - a friend told him, "If you're looking to put your money in something, do not put it in stocks. Put it in anything but stocks."
That's a bottom. Only when your friend you run into and haven't seen for a while tells you, "Whatever you do, don't buy a house!", only then will housing be at a bottom.
Chrysler says no basis to bankruptcy rumor Expired
A spokesman for Chrysler LLC on Thursday said market rumors of a bankruptcy filing by the privately held automaker were "without merit," saying the company had ample liquidity.
Chrysler Financial's first-lien term loan fell about 4 points to 81.375-82.375, according to Loan Pricing Corp.
Those loan prices don't seem like a vote of confidence in Cerberus.
Anonymouse writes:
Only when your friend you run into and haven't seen for a while tells you, "Whatever you do, don't buy a house!", only then will housing be at a bottom.
What percentage of these sales will actually close? Many sales are contingent on the buyer selling their current house. In a lot of markets the odds of that happening would look to be microscopically small.
ipodius has an interesting idea that oil will tank and drag rapidly everything else down with it so that explicit wealth-destruction is realized and not masked by infaltionary energy & food...but various saber-rattling (IRAN for example, or "instability in Nigeria) can prop markets up still...
...I'm not sure it matters however because underlying food prices are about to sky-rocket (again) in the absence (this time) of petro prices staying or going high (fertilizer, equipment fuel, shipping, etc...)...food is being destroyed (bad yields, blight, hoarding protectionist policies (Japan), million plus acres drowned in the mid-west...GD was proceeded by 5 years (at least) of progressive crop failures, floods, & dust-bowls...in addition to financial melt-down...I doubt the "system" has enough slack in it to remain resilient to present and future shocks, so the underlying result is IMO wealth-destruction, deflation...now that housing inventory & FCs are over-shooting the GD levels...Welcome Formerly known as home-owner society...
BB writes: "They're all saying houses are cheap now."
I'm listening to an NPR program this morning about house prices and of the three guests, Karl Case of Case-Schiller is the least bullish. They're all talking about a bottom nearby.
I think Brian Pretti put it best: The bottom in a market occurs only when nobody's talking about a bottom.
As someone else pointed out to me, we are talking about "bottoms" in historical terms. We are in un-chartered territory now, so we may be far from a bottom, like 7 to 10 years away. GD was officially 1929 into 1946 (with GDP growth resuming)...that's a generation...
They can be the first to go BK, and the last in-line to get capital in a credit crunch...buyer beware...
...you could lose hundred-percent of the value of a company that goes by-by, but 70% if oil,gold,silver, whatever goes through the floor...it'll never go to zero...just a thought...
I'm not sure it matters however because underlying food prices are about to sky-rocket
Yes, but that, again, is a temporary phenonenon. Oil prices are the source of all the agnst in the economy at this point. And I do honestly think they are going to take a swan dive as demand is going to get destoyed more than anyone thinks. When you have 1 in 7 planes being grounded, that alone is going to cause a huge demand reduction. Add in the miles not drive, boats not in the water, and developing country economic malaise as we hit the skids here and our consumption slows...
Believe me, I weigh your opinion strongly. I think the net result will be realized loss-of-value across the board, along with a high unemployment rate...I think it is more likely than not that China & India will slow down along with Europe and that net demand "ought" to drive prices down rapidly. "Ought" ... I'm just considering some distortions to this possibility (is peak oil more likely than not and knocking at the door, is instability of a major supplier more likely than not, will the US engage in additional foreign adventurism)...on this last paranthetical...IRAQ sucks 2mill bpd off the global market...how about another conflict geographically distant from America...again, not sure about the details...speculation ensues...
No burnside, but I'm going to read that now, thanks for the link. Her analysis is usually very very good and on the mark.
And BB I think that is why the central banks are being a bit circumspect at the moment. They know if oil tanks all they have to do is sit back and watch for a bit as prices recede and that problem corrects itself. Which, btw, is going to put egg on Trichet's face when the eurozone buckles under the high rates he is (erroneously) forcing on them. He needs to cool his jets before he sends them down the tubes for no good reason.
(OT) Anonymouse said: "...I think they're with Seb, O-Joe, aheadofthecurve, etc, buying up the small caps at bargain basement prices."
I can't speak for anyone else, but for me that's pretty close. I've been waiting for a condition of climax-type panic selling in the face of a positive economy, and this looks like it could be it. All I need now is an indication that the broad market is stabilizing and I'll jump back into small caps with both feet.
FYI,I know a couple of farmers away from the flooding and they both tell me it looks to be a record year. Think going from 150-160 bu/acre to 200+ in corn this year. Good rains at the right time. I will wait for this years crops to come in before getting excited.
For those of you that haven't read MOM's post on oil linked by burnside above, you should. It hits the nail on the head and is what I've been saying for a while now.
The moment is coming...and just in time for the elections, I might add.
I am waiting for MoM's scenario to occur however what it does not account for is the coming issue with Iran and Syria (via our bought and paid for friends in Israel)...
Totally agree with the post but am waiting for the spike caused by that guaranteed event.
I just can't believe that bushco will just walk away without action that drives oil to over $200.....
ipodius said: "For those of you that haven't read MOM's post on oil linked by burnside above, you should. It hits the nail on the head and is what I've been saying for a while now...."
After reading this (which is better researched and documented, no offense), I'm not so sure.
Sebastian, these two posts are talking about two different things. One is demand destruction, and the other is speculation. Is this how you interpret normal economic data? By comparing apples to oranges?
The points in Yves and MOM's posts are the fundaments of price and demand destruction. Speculation is besides the point. Or do you think that we'll just keep paying the money for higher fuel with no major demand destruction?
"I'm listening to an NPR program this morning about house prices and of the three guests, Karl Case of Case-Schiller is the least bullish. They're all talking about a bottom nearby."
So, you're saying houses will "bottom" at permanently unaffordable levels, which will go nicely with a crumbling job market and run-away inflation in needs?
Somehow, I just don't think so.
Houses will bottom when people can afford them... and even then, they will overshoot to the downside.
ipodius said: "The points in Yves and MOM's posts are the fundaments of price and demand destruction. Speculation is besides the point. Or do you think that we'll just keep paying the money for higher fuel with no major demand destruction?"
I agree that speculation is beside the point, but also that so-called "demand destruction" is, too, if it's accompanied by lower supply.
...daily output of crude oil and products peaked in *August, 2005, nearly three years ago!!
So, clearly, we are willing to keep paying higher prices for fuel, and for a considerable period of time, with the "demand destruction" argument obviously having no effect on bringing down prices.
Sebastian, clearly there is a limit to the curve here, and that's what the subject is. Or do you think that everyone will just keep paying? What about the 1 in 7 aircraft now grounded? The miles driven decline?
What these articles talk about is the limit here, cause, you know there is one. Unless you think that everyone can just use up all their earnings on fuel.
I've heard a different explanation of part of the disparity of oil prices of late
There are different types of crude. There is the "light sweet" crude that comes out of West Texas and England... then there's the medium to heavy sour stuff that comes out of the Middle East.
The prices quoted usually are the WTI or Brent prices (so light sweet). this can be processed by any plant in the world.
The problem is that the oil sent to refineries is increasingly of the medium to heavy grade stuff... and also sour. Only certain refineries are able to refine this. (like Valero I believe). This heavier/sour crude always trades/is delivered at a discount.
thus, one of the problems is that we have skyrocketing Brent/WTI crude prices because that's what we "need" for refineries... whereas the increase in production of late has been increasingly heavy or sour... basically unrefinable... at this point in time.
this partially explains the iranian tankers filled with unrefined oil while the posted crude prices continue to rise.
A key reason why oil prices have been going up is that Asia and the oil producing countries are consuming more while global oil production has stagnated. That means Europe and America had to consume less, and a very high price proved necessary to accomplish that.
From ipod:
The points in Yves and MOM's posts are the fundaments of price and demand destruction. Speculation is besides the point. Or do you think that we'll just keep paying the money for higher fuel with no major demand destruction?
Short answer - both.
If prices fall to much - demand will jump right back up. So in effect we & the world are in price discovery at what price can demand cope with the available supply? My guess is there will be demand destruction & price decline but my guess is the price won't fall precipitously - not unless demand falls even more than we anticipate (very severe recession). Chalk it up to oil's relative inelasticity of demand - other stuff will have to give a lot more first.
Like food demand, and other damned thing that requires fuel to get to market, or oil to manufacture grow. Like plastic packaging, polyester, nylon, fertilizer...the list is friggin' endless.
Prices down 6.3% YOY
Sales down 15% YOY
Sales always up May to June, this year only up 2% is bad news
Obscene that the media still reports MOM increases as headlines when YOY sales are cliff diving.
*April to May
Some consolation.
Any word on the supply figures? (I'm sure CR's graphs will be lovely)
So, anything going on in the markets today?
Nemo writes:
So, anything going on in the markets today?
GM looks like a good buy.
NAR is slow to release the data online again
They must be thinking we will forget about it or something like that.
GM looks like a good buy.
BB
BB, please use spellchecker.
it is spelled goodbye
REBear, this is the 2nd month in a row that they didn't release the data online right away. Weird. There site is having all kinds of problems.
I think you are correct - maybe they are thinking if they don't release the data, no one will realize how bad the housing situation is!
Best Wishes.
sandystructures Auto Group writes:
BB, please use spellchecker.
I got a dyslexic heart.
along the same lines as the 10Q that has not appeared for LEH......from over a week ago.
Ciao
MS
IIRC the new home sales numbers lead the used home sales, so the recent decline in new home sales is more relevant going forward, right?
but they filed this instead:
40-6B \t[html][text] 1 KB \t[Paper]Application for exemption from all provisions of The Investment Company Act of 1940 by an Employee's Investment Company
Acc-no: 9999999997-08-029304 (40 Act)
Cheeky it ain't
Ciao
MS
Freddie Mac: 30-year fixed rate average rises slightly
Bailout driven equities market. Think the market likes this ?
[Sen. Christopher J. Dodd, D-Conn., the Banking Committee chairman, said that could be the death of the measure.
"Getting back on the floor again with a matter like this gets hard," Dodd said. "If you don't seize the moment when you have the opportunity to get something done like this, you can lose it."]
Inventory of 10.9 months, the same as for new homes. My feeling is that by the end of this year, we're going to be seeing over 12 months supply, as shadow inventory begins to appear.
4.49 million homes for sale, down very slightly from the all-time high of 4.561 million in July 07, and 4.552 last month (Apr 08).
oil up, market down,...rinse, wash, repeat. 11,000 by August.
Young 12th Percentile to parents: "they aren't going to have report cards this quarter...too bad because I did really well"
12th's Parents: "interesting...you will be doing hard manual labor anyway. It builds character"
Of the total sales, 38.4% (12,648) were foreclosure resales.
Last year foreclosure resales were only about 5% of total sales.
Mr. Mortgage’s Guide to the TRUTH! » Mr Mortgage – May Existing Home Sales Preview
Obscene that the media still reports MOM increases as headlines when YOY sales are cliff diving.
I agree. And I also remember when this thing was just getting rolling that they used the YoY comparison when the MoM were showing the beginnings of a downturn.
I was reflecting on something related this morning... A market analyst I admire once remarked that back in early 1982 - right before the great two decade bull market in U.S. stocks began - a friend told him, "If you're looking to put your money in something, do not put it in stocks. Put it in anything but stocks."
That's a bottom. Only when your friend you run into and haven't seen for a while tells you, "Whatever you do, don't buy a house!", only then will housing be at a bottom.
Chrysler says no basis to bankruptcy rumor
Expired
A spokesman for Chrysler LLC on Thursday said market rumors of a bankruptcy filing by the privately held automaker were "without merit," saying the company had ample liquidity.
Chrysler Financial's first-lien term loan fell about 4 points to 81.375-82.375, according to Loan Pricing Corp.
Those loan prices don't seem like a vote of confidence in Cerberus.
Anonymouse writes:
Only when your friend you run into and haven't seen for a while tells you, "Whatever you do, don't buy a house!", only then will housing be at a bottom.
They're all saying houses are cheap now.
blackhat writes:
"oil up, market down,...rinse, wash, repeat. 11,000 by August."
Will be below 11,000 within days, and lucky to bounce as high as 11,000 in August.
What percentage of these sales will actually close? Many sales are contingent on the buyer selling their current house. In a lot of markets the odds of that happening would look to be microscopically small.
vtcodger writes:
What percentage of these sales will actually close?
You hit the nail on the head. However, perception is everything nowadays.
ipodius has an interesting idea that oil will tank and drag rapidly everything else down with it so that explicit wealth-destruction is realized and not masked by infaltionary energy & food...but various saber-rattling (IRAN for example, or "instability in Nigeria) can prop markets up still...
...I'm not sure it matters however because underlying food prices are about to sky-rocket (again) in the absence (this time) of petro prices staying or going high (fertilizer, equipment fuel, shipping, etc...)...food is being destroyed (bad yields, blight, hoarding protectionist policies (Japan), million plus acres drowned in the mid-west...GD was proceeded by 5 years (at least) of progressive crop failures, floods, & dust-bowls...in addition to financial melt-down...I doubt the "system" has enough slack in it to remain resilient to present and future shocks, so the underlying result is IMO wealth-destruction, deflation...now that housing inventory & FCs are over-shooting the GD levels...Welcome Formerly known as home-owner society...
BB writes: "They're all saying houses are cheap now."
I'm listening to an NPR program this morning about house prices and of the three guests, Karl Case of Case-Schiller is the least bullish. They're all talking about a bottom nearby.
I think Brian Pretti put it best: The bottom in a market occurs only when nobody's talking about a bottom.
We deserve a break today: how about down 510 to 11,302?
dow 30 to become dow 35, adding undertakers to the index, analysts say index to stabilize
Anonymouse writes:
I think Brian Pretti put it best: The bottom in a market occurs only when nobody's talking about a bottom.
Agreed. It's a bottom.
peAkcredit writes:
We deserve a break today: how about down 510 to 11,302?
I Don't expect capitulation today.
Am waiting for Trichet.
Anonymouse,
As someone else pointed out to me, we are talking about "bottoms" in historical terms. We are in un-chartered territory now, so we may be far from a bottom, like 7 to 10 years away. GD was officially 1929 into 1946 (with GDP growth resuming)...that's a generation...
CR update: NAR still hasn't released the data online.
I think they're with Seb, O-Joe, aheadofthecurve, etc, buying up the small caps at bargain basement prices.
BB: U.S. surrenders to France?
peAkcredit writes:
BB: U.S. surrenders to France?
That would be a little too much even for this mess.
BB, is that nice or civil, mentioning 'capitulation' and a Frenchman in the same post?
Bad thing about these down days on the market is that it kills my productivity.
Dang, I have a lot to do today, too.
ote on "small-caps":
They can be the first to go BK, and the last in-line to get capital in a credit crunch...buyer beware...
...you could lose hundred-percent of the value of a company that goes by-by, but 70% if oil,gold,silver, whatever goes through the floor...it'll never go to zero...just a thought...
Ok, DOW broke its January lows; let's see if it holds to a new closing low - (my forecast - it will).
"Dodd said. "If you don't seize the moment when you have the opportunity to get something done like this, you can lose it."]"
A good ass poking while everyone has their back turned is more like it. Hope that thing goes down in a ball of flames along with Mr. Dodd.
jg writes:
Bad thing about these down days on the market is that it kills my productivity.
Resistance is useless. You have been assimilated to CR.
I'm not sure it matters however because underlying food prices are about to sky-rocket
Yes, but that, again, is a temporary phenonenon. Oil prices are the source of all the agnst in the economy at this point. And I do honestly think they are going to take a swan dive as demand is going to get destoyed more than anyone thinks. When you have 1 in 7 planes being grounded, that alone is going to cause a huge demand reduction. Add in the miles not drive, boats not in the water, and developing country economic malaise as we hit the skids here and our consumption slows...
Seb where are you??
ipodius writes:
Yes, but that, again, is a temporary phenonenon. Oil prices are the source of all the agnst in the economy at this point.
That's what the ECB and UK counterparts are thinking too.
I just wonder if there is a huge enough demand destruction for prices to tank. If not am afraid it'll probably come right up again.
ipodius,
Did you read MoM yesterday? She has her own way of arriving at your precise conclusions regarding oil pricing/futures.
MaxedOutMama: And Nothing Ever Changes?
ipodius,
Believe me, I weigh your opinion strongly. I think the net result will be realized loss-of-value across the board, along with a high unemployment rate...I think it is more likely than not that China & India will slow down along with Europe and that net demand "ought" to drive prices down rapidly. "Ought" ... I'm just considering some distortions to this possibility (is peak oil more likely than not and knocking at the door, is instability of a major supplier more likely than not, will the US engage in additional foreign adventurism)...on this last paranthetical...IRAQ sucks 2mill bpd off the global market...how about another conflict geographically distant from America...again, not sure about the details...speculation ensues...
GM announces first car in their new fall line-up: "The Small Cap"
Thank you Ben.
Thank you for confirming my faith in you.
blackhat,
Although I'm willing to look at peak oil, I'm fairly sure it's not significantly in play at the moment.
Let me see if I can find the Yves Smith post from a day or two ago - it's far better than anything I could whip up.
OK. Here:
Thomas Palley: "Beating the Oil Barons" (And the Misunderstood Role of Inventories) « naked capitalism
Anyone have a copy of O-Joe making fun of CR as being a counterindicator for stock market lows?
O-Joe
is a no show
when there's a new low
so he can't eat crow
Did you read MoM yesterday?
No burnside, but I'm going to read that now, thanks for the link. Her analysis is usually very very good and on the mark.
And BB I think that is why the central banks are being a bit circumspect at the moment. They know if oil tanks all they have to do is sit back and watch for a bit as prices recede and that problem corrects itself. Which, btw, is going to put egg on Trichet's face when the eurozone buckles under the high rates he is (erroneously) forcing on them. He needs to cool his jets before he sends them down the tubes for no good reason.
(OT) Anonymouse said: "...I think they're with Seb, O-Joe, aheadofthecurve, etc, buying up the small caps at bargain basement prices."
I can't speak for anyone else, but for me that's pretty close. I've been waiting for a condition of climax-type panic selling in the face of a positive economy, and this looks like it could be it. All I need now is an indication that the broad market is stabilizing and I'll jump back into small caps with both feet.
Sebastia
blackhat | 06.26.08 - 11:22 am |
FYI,I know a couple of farmers away from the flooding and they both tell me it looks to be a record year. Think going from 150-160 bu/acre to 200+ in corn this year. Good rains at the right time. I will wait for this years crops to come in before getting excited.
Chris
For those of you that haven't read MOM's post on oil linked by burnside above, you should. It hits the nail on the head and is what I've been saying for a while now.
The moment is coming...and just in time for the elections, I might add.
It will be a bottom when Seb capitulates. No sooner. It is going to be a while and many of us will be far richer when it occurs.
I am waiting for MoM's scenario to occur however what it does not account for is the coming issue with Iran and Syria (via our bought and paid for friends in Israel)...
Totally agree with the post but am waiting for the spike caused by that guaranteed event.
I just can't believe that bushco will just walk away without action that drives oil to over $200.....
Ciao
MS
ipodius said: "For those of you that haven't read MOM's post on oil linked by burnside above, you should. It hits the nail on the head and is what I've been saying for a while now...."
After reading this (which is better researched and documented, no offense), I'm not so sure.
Econbrowser: How big a contribution could oil speculation be making?
Sebastia
Sebastian,
Try Yves Smith, cited above. Better still. And no offense taken.
"Chrysler says no basis to bankruptcy rumor"
A rumor isn't true until it is officially denied.
Sebastian, these two posts are talking about two different things. One is demand destruction, and the other is speculation. Is this how you interpret normal economic data? By comparing apples to oranges?
The points in Yves and MOM's posts are the fundaments of price and demand destruction. Speculation is besides the point. Or do you think that we'll just keep paying the money for higher fuel with no major demand destruction?
"I'm listening to an NPR program this morning about house prices and of the three guests, Karl Case of Case-Schiller is the least bullish. They're all talking about a bottom nearby."
So, you're saying houses will "bottom" at permanently unaffordable levels, which will go nicely with a crumbling job market and run-away inflation in needs?
Somehow, I just don't think so.
Houses will bottom when people can afford them... and even then, they will overshoot to the downside.
ipodius said: "The points in Yves and MOM's posts are the fundaments of price and demand destruction. Speculation is besides the point. Or do you think that we'll just keep paying the money for higher fuel with no major demand destruction?"
I agree that speculation is beside the point, but also that so-called "demand destruction" is, too, if it's accompanied by lower supply.
According to this:
Natural Gas and Petroleum Navigator Error Page
...daily output of crude oil and products peaked in *August, 2005, nearly three years ago!!
So, clearly, we are willing to keep paying higher prices for fuel, and for a considerable period of time, with the "demand destruction" argument obviously having no effect on bringing down prices.
Sebastia
Sebastian, clearly there is a limit to the curve here, and that's what the subject is. Or do you think that everyone will just keep paying? What about the 1 in 7 aircraft now grounded? The miles driven decline?
What these articles talk about is the limit here, cause, you know there is one. Unless you think that everyone can just use up all their earnings on fuel.
I've heard a different explanation of part of the disparity of oil prices of late
There are different types of crude. There is the "light sweet" crude that comes out of West Texas and England... then there's the medium to heavy sour stuff that comes out of the Middle East.
The prices quoted usually are the WTI or Brent prices (so light sweet). this can be processed by any plant in the world.
The problem is that the oil sent to refineries is increasingly of the medium to heavy grade stuff... and also sour. Only certain refineries are able to refine this. (like Valero I believe). This heavier/sour crude always trades/is delivered at a discount.
thus, one of the problems is that we have skyrocketing Brent/WTI crude prices because that's what we "need" for refineries... whereas the increase in production of late has been increasingly heavy or sour... basically unrefinable... at this point in time.
this partially explains the iranian tankers filled with unrefined oil while the posted crude prices continue to rise.
please excuse my very poor rehasing of the idea.
From Econobrowser link:
A key reason why oil prices have been going up is that Asia and the oil producing countries are consuming more while global oil production has stagnated. That means Europe and America had to consume less, and a very high price proved necessary to accomplish that.
From ipod:
The points in Yves and MOM's posts are the fundaments of price and demand destruction. Speculation is besides the point. Or do you think that we'll just keep paying the money for higher fuel with no major demand destruction?
Short answer - both.
If prices fall to much - demand will jump right back up. So in effect we & the world are in price discovery at what price can demand cope with the available supply? My guess is there will be demand destruction & price decline but my guess is the price won't fall precipitously - not unless demand falls even more than we anticipate (very severe recession). Chalk it up to oil's relative inelasticity of demand - other stuff will have to give a lot more first.
ipodius,
Here's the agent that sold me it.
YouTube -
dryfly,
"other stuff will have to give a lot more first."
Like food demand, and other damned thing that requires fuel to get to market, or oil to manufacture grow. Like plastic packaging, polyester, nylon, fertilizer...the list is friggin' endless.
Cheers,
ipodius,
Try this,
YouTube -
Cheers,