This is probably because of the economy of course and the automobile industry speculations.

Best regard,
Michael Fridman
The “MAN” Experience

Yes, but with more houses, there will be more need for "stuff".

CR,

Your chart expresses it better, but here are the CU numbers from Dec thru May
72.7 71.2 70.7 69.4 69.0 68.3

There may have been moderation in deterioration, but this measure is still declining at a cliff-diving rate.

So non-Residential Investment keeps getting postponed, correct?

But now that Chrysler is restarting the Viper plant, this number should improve dramatically!

Ouch. Let's see how they spin this one.

Private property rights...wait til you see what Sotomayor does to those...she expanded on the Kelo vs New London case in a land grab with crooked pols...

The Taking of Port Chester - Forbes.com

More evidence of hyperinflation!

The new service economy will save us.

Rob Dawg,

Who will be servicing? And doesn't Thailand already have a corner on that market?

This is what happens when you keep interest rates low- it creates the deflation that you are trying to prevent by allowing capacity to remain operating. Higher interest rates would force the liquidation of capacity which will lead to higher prices. Supply /demand can be brought into balance either through increasing demand or destroying supply. If the only way to increase demand is through aggressive borrowing it only postpones the day but even more important results in a REDUCTION in aggregate demand determined over several years.(income that would have been used to purchase stuff is now used to pay interest).

Escanaba, MI attorney general's office -21

UCLA forecast: CA state worker layoffs could top 60,000

Marvel Manufacturing -65

Palm Springs, CA school district -120

Lansing, MI Community College -19

Springfield, MA area schools -74

Salida, Ca area schools -13

Redwood City, CA layoffs -11

Illinois Governor: 10,000 layoffs needed to balance budget

City of Tallahassee, FL -80

City of Petaluma, CA -10

Texas Regional Girl Scouts offices -11

Portage, MI area schools -23

City of Visalia, CA issues furloughs to 575 city workers

City of New York budget agreement reached -2,000

Massive layoffs looming in Minnesota due to budget crisis

City of Cincinnati, OH -47

"Horrific" budget cuts, layoffs coming to the Univrsity of California system

Watson Pharmaceuticals -275

Fall River, MA additional layoffs possible -200

The supposed recovery in picutres

Untitled Document

second yogi--citation?

--bh

BH,

Yes, it appears deflation is still prevailing in the near term.

Crazyv,

Listened to a Bloomberg radio interview with Barry Ritholz from last week where he quoted someone saying " Capitalism without failure is like religion without sin." His point being that we HAVE to let failing firms fail in order for the market to be efficient. As it is we have chosen poorly - the long slow grind down.

@JD - leverage?

OK, it's Didden v. Port Chester. Didden v. The Village of Port Chester [Summ. Ord.] - U.S. Court of Appeals for the 2nd Cir. - April 05, 2006, Federal Circuits, Docket 04-3485 - vLex

It was decided on Statute of Limitations grounds. In dicta, the Court en banc said that they are bound by ___Kelo which holds that there can be a condemnation for private use in conjunction with a redevelopment plan. There is no expansion of Kelo at all.

"Retard economic growth"--

apt phrase from article on CA economy applied to the rest of the economy.

We are all "retard economic growth" now.

--bh

@blackhat

Reacceleration of UE in the second half is what I've expected to happen all along as companies that held onto key employees for the second half V-2 (non)recovery. Didn't a lot of those early rockets explode on the pad?

CR:

Curious about something:

At what point does disutilized capacity fall off the chart?

On Sotomayor and Kelo vs. Port Chester...

"Judge Sonia Sotomayor will doubtless be questioned about Kelo at her confirmation hearings next month. But her answers will be complicated by her participation in a 2006 decision applying and extending Kelo.

Bart Didden, the property owner on the losing side of that decision, Didden v. Village of Port Chester, said in an interview that he had been contacted by aides to Republicans on the Senate Judiciary Committee who seemed eager to explore Judge Sotomayor’s views on property rights.

The ruling in Didden is not popular among some property rights and constitutional law professors. Eight of them filed a brief in 2006 unsuccessfully urging the Supreme Court to hear an appeal.

“This is the worst federal court takings decision since Kelo,” said Ilya Somin, who teaches property law at George Mason University and helped write the brief. “It’s very extreme, and it is significant as a window into Judge Sotomayor’s attitudes toward private property.”

NYTImes, June 15, 2009

Link to the Didden vs Port Chester article

Issue of Property Rights Is Likely to Arise in Sotomayor's Confirmation Hearings - NY Times

In addition to the weakness in industrial production, there is little reason for investment in new production facilities until capacity utilization recovers

CR,

That's exactly the kind of logical thinking that we have to change. We need to do something, anything to get credit expanding again. We're in the steep part of the exponential credit growth curve man. We need massive amounts of foolishness here. There's no time for logic. Just ask Krugman.

Chainsaw,

You just made one of the best points about capitalism and free markets I've seen made among the rhetoric about those two subjects proffered on this board.

"Without failure, you don't have capitalism or free markets."

All of the people blaming free market ideology for our current woes need to read and reread that statment over and over. We don't have free markets in this country. We haven't had them for a long time. To blame this problem on "capitalism" is to commit intellectual dishonesty.

/rant off

Isn't it interesting how far back into the woodshed the Wide Elephant Party (only a few of the faithful dare question Rush's ad hoc leadership of...) has become?

crazyv (profile) wrote on Tue, 6/16/2009 - 9:43 am

This is what happens when you keep interest rates low- it creates the deflation that you are trying to prevent by allowing capacity to remain operating. Higher interest rates would force the liquidation of capacity which will lead to higher prices

That's crazy talk. Allowing firms to fail would lead to Malthusian collapse.

As many of the advocates can tell you, the crisis they posit to have arisen from forced liquidation would have been so much worse that what did happen, that whatever happens from this extraordinarily irresponsible bailout and intervention, it is a resounding success.

JD wrote: "Hyperdevaluation is what's coming, not hyperinflation."

The gov't is only interested in CPI for the masses. IMO we are seeing a split in price movements between essentials (inflation) and non-essentials (deflation). The fact that CPI hasn't shown 10% or more deflation given plunging prices on high volume non-essentials (TVs, Furniture, Clothes) demonstrates they are being more then offset by increasing prices for essentials (Milk, Eggs, Bread).

Even though the iPhone is probably not in the CPI basket, it is indicative of what I'm talking about. The original 8GB iphone was $600 while two years later a more powerful, faster 8GB is only $100. Given the CPI use of heuristics in the CPI I'm sure they conclude this decrease is about an 80% price "deflation". Imagine the price increase necessary some essential that is need to offset this deflation to average out to flat prices.

Anyone who argues we will see either deflation or inflation is wrong, both are a certainty. (

"...Appellants, however, brought suit in January 2004, more than three years after the date their claims accrued, and thus their claims are time-barred. We reject Appellants' contention that their injury actually accrued in November 2003 when G&S and Wasser "first utilized their de facto eminent domain power against [them] in an effort to exact a cash payment or partnership interest" in the pharmacy project.

Moreover, even if Appellants' claims were not time-barred, to the extent that they assert that the Takings Clause prevents the State from condemning their property for a private use within a redevelopment district, regardless of whether they have been provided with just compensation, the recent Supreme Court decision in Kelo v. City of New London, 125 S. Ct.2655 (2005), obliges us to conclude that they have articulated no basis upon which relief can be granted....

The district court properly dismissed the complaint on the ground that the Appellants' claims are time-barred. Accordingly, the judgment of the district court is hereby AFFIRMED."

The moreover paragraph is not caselaw and could not expand Kelo even if it said so, which it doesn't.

TCA, that is a great link.

Krugman's always so certain he knows what's what, and anticipates all consequences. He talks about the economy like it's a board game only he and a few others are capable of understanding. He has a facile answer to everything.

Dick Fuld has a high-paying job. There's failure right there.

Monetary history is chock-full of instances of what's happening now, but the ruse used to be metallic or paper in scope, which is why it's so hard for people to relate to systematic computerized fraud, hidden away from prying eyes...

U.S. Rejects California Aid Request

Somebody mentioned yesterday that they saw empty spots in San Pedro, where there used to be football fields of new cars going nowhere fast previously.

Where'd they go?

creditcriminalsoverlap: "Milk is down 25% or more from last year...."

Not where I shop, BJ's wholesale...in a bad neighborhood

I keep track of various items from time to time (in a very unprofessional manor, I might add), but it has been much more reliable then CPI for the last eight years.

I know, I shouldn't believe my lying eyes.

Infllation in the things you need, deflation in the things you cannot afford.

Dawg, I got pigged. Again.

I used to hold that view. But it's not happening, at least in my life. Things I want are definitely going down. Way down in many instances. But the things I need such as food, energy, shelter, insurances are no longer increasing as quickly. In fact, many of my needs are decresing in cost.

Is this permanent? I don't know. But looking at the behaviour of those around me, I don't see people rushing to spend their money in order to beat price increases. Just the opposite. People are economizing in all area - needs and wants.

Demand is on the ropes imo. That's not inflationary against a backdrop of over-capacity.

That would be hedonics.

When arguing about a judicial ruling, read the actual opinion--as yogi did. Indirect sources such as news articles are valueless.