All is right in the world - gold up, oil up, markets down.

it would look something like an “L” with a gradual upward tilt of the base.

Oh great. A "Castration Hook Recovery."

Empirical evidence suggests Yellen's personal target for inflation is "anything north of five percent".

I think it was cut off on the last sentence:
".... thus paving the way for the resurgence of disco."

Seriously, in addition it seems we've just begun to see the impact of municipal and school job cuts. It's hard to be optimistic about employment and spending for any reason.

Rob Dawg wrote:

Oh great. A "Castration Hook Recovery."

Castration Hook?

"First, it may take quite a while for financial institutions to heal to the point that normal credit flows are restored.
Serious question: How does define "normal credit flows"?"

The FED defines normal credit as J6P being able to get an IO loan on their home and immediately refi to purchase a Cadillac Escalade with 94" chrome rims.

CalculatedRisk wrote:

I'm a little surprised by the pickup in activity ...

Who is it that says that "there's nothing about oversupply that price adjustments won't fix", or something to that effect?

"...it would look something like an “L” with a gradual upward tilt of the base. With such a slow rebound, unemployment could well stay high for several years to come."ed.

Like a parking stub, I'm validated! Lost decade, here we come!

That may be the case CR however she knows the basic math (70% of GDP is buying crap and having it serviced) and to say it's "cloudy" is an understatement on an entirely different level. Yellin is like the analyst who tries to say that she's different without having anything to back it up. But I understand the political nature of having opposing views...at least have one that makes sense. After-all if these things are so "troubling" then why do we get unanimity at Fed meetings?

Just sayin'

Ciao
MS

"I've been seeing much more activity in my neighborhood (houses selling, some new construction) and this mirrors what Professor Krugman wrote this morning..."

Anecdotal: It's getting worse here, outside Portland. More cars, trucks, boats, RVs for sale by the side of the road. More foreclosures, more price cuts on everything from housing to food. Broccoli at 68 cents per pound. My carpenter friends reduced to any kind of handyman work they can scrape up.

And the Understatement of the Year award goes to...

• The credit crunch hasn’t entirely gone away
• Prospects for consumer spending are cloudy
• Some of the advance reflects temporary government support

Janet Yellen!

I'm a little surprised by the pickup in activity ...

I believe the word you are looking for is "bounce".

Cinco-X wrote:

Perhaps a massive prison building program will drive "the recovery"?

A certain left coast state is under FedGov mandate to free 40,000 prisoners.

creditcriminalslovetarp wrote:

pomo is done...what say you Yellen? more to come?

When the call for POMO is "MOMO!" you can bet your JOJO on the return of their MOJO

I see more trucks on the road. Some of them are the name brand freight lines. I am also seeing more trades vans out. Yeah, there may well be some activity. I am just wondering how uneven it is. I live in the lowest UE area in the country so that may skew it.

nova wrote:

I live in the lowest UE area in the country so that may skew it.

Montana?

"Lenders ran hard to stay in place? If they did any running, surely it was to get to Washington, DC."

it's hard to run with knee pads. More like shuffling.

A certain left coast state is under FedGov mandate to free 40,000 prisoners.

A gross misstatement, if I recall the case.

California was not ordered by a Federal Court to release a single prisoner. It was ordered to provide enough breathing room for the prisoners it holds.

Maybe you think the US Constitution shouldn't apply to the left coast?

1 currency now -yogi wrote:

It was ordered to provide enough breathing room for the prisoners it holds.

Since CA is bust and broke, how should they provide enough breathing room sans prisoner releases? The Law has a funny way of trying to force its way on others without really providing the means to do it. Should the petitioners just get the symbollic 1 USD and call it even?

Maybe you mean: shambolic?

CR, don't forget that Krugman is on the hook regarding the benefits of Keynesian pumping. I consider him hopelessly biased right now.

Cinco-X wrote:

You DO realize I was snarking, right? Should I return to putting a snark/no snark at the end of every post
BTW Rob, have you done any work with green (as in eco friendly) building?

Of course I know you were snarking but the problem is there are some who think prison building is a productive enterprise.

As to green architecture, I am very familiar with passive particularly residential techniques including land use, terrain and biological influences. This more recent fad of LEEDS is more of a school of thought in architecture than a true sustainable practices methodology. For that I rely on my niece who is a USC Arch grad in high demand for her designs in so called sustainable commercial/retail.

,rads y apparatchicas,

I am going pining for gold in the guise of Black Oak leaves @ around 5,000 feet above the sea, or in other words, i'm going to see the forest for the trees...

Raise taxes? Cut spending? We're so broke now we can't do either w/o precipitating the long overdue depression and collapse of the dollar. Plus, is it no wonder we have a difficult time borrowing from foreigners now and have had to print? So what should we do for income? We definitely need an income to pay for our prolific spending. What we need is a reliable corporation to replace AIG to insure our debt owed to foreigners (48% of our national debt is owed to them right this moment and going higher) and allow them to sleep at night worry free. What we need to do is collect insurance premiums FROM foreigners @ a 30% per annum rate on the debt owed. We should be able to demonstrate to them that we can provide the insurance, I mean, afterall, the debt is denominated in our currency. Ha, ha, ha, ha.

falminia,

Do you trust this realtor? I work with realtors every day and I can tell you that they constantly "distort" the truth. The data tells the unvarnished reality (not saying that LA couldn't be seeing some activity).

Rob Dawg wrote:

Of course I know you were snarking but the problem is there are some who think prison building is a productive enterprise.

Really!? Any names you'd be willing to divulge? I was under the impression the libertarian leaning commentariat was in general in favor of letting minor offenders, particularly those incarcerated for marijuana, out of prison to free up room for the "real" criminals.

So the Constitution is void if the State claims to be broke? Did California lose its taxing power?

We can't afford enough courtrooms so Habeas Corpus and speedy trials are out the window. Grand juries are a waste of time. Warrants are a waste of time.

t r orwell wrote:

Raise taxes? Cut spending? We're so broke now we can't do either w/o precipitating the long overdue depression and collapse of the dollar.

Neither raising taxes nor cutting spending would result in a dollar collapse. It might hammer the economy immediately and be very painful for most, but the subsequent debt clearing would rapid set the stage for a "real" recovery, something we haven't seen around these parts for a long time.

1 currency now -yogi wrote:

We can't afford enough courtrooms so Habeas Corpus and speedy trials are out the window. Grand juries are a waste of time. Warrants are a waste of time.

Miami-Dade County is probably violating Due Process since everything seems to be filed in boxes and the backlog grows longer by the day. It seems like resources are necessary to enforce the Constitution...

poic wrote:

"There is no relief other than a prisoner release order that can remedy the constitutionally inadequate medical and mental health care," the panel led by Court of Appeals Judge Stephen Reinhardt, wrote.

Isn't the 9th U.S. Circuit Court of Appeals the court that is most often overturned by the SCOTUS, or is that the 5th?

"reservoirs of slack" I really like that term. If there was a band named Reserviors of Slack, I would definitely go see them. Their first album might be Turning Japanese, or Deeper and Deeper.

Yancey Ward wrote:

I thinks lots of people are pining for gold these days.

Until (unless), again, Glod is legal tender for all debts public and private, having glod in your gun safe or under your BBQ pit is kinda useless. You can't eat it, you can't buy beer and bread with it, and it is subject to confiscation (again) at whatever price the gov't chooses.

And small denominations are needed. $1,000 coins are not going to be used for buying gas and groceries.

That statement by the panel is obviously false. There must be a level of adequate care that meets constitutional standards, if California chooses instead to supply it.

It seems like resources are necessary to enforce the Constitution...

That is so, and the Constitution can not be fairly enforced by Wall Street. Government workers must do it, paid for by taxes.

JimPortlandOR wrote:

Until (unless), again, Glod is legal tender for all debts public and private,

I would personally accept it as payment in lieu of electrons.

Small denominations, that's what silver's for.

High unemployment, weak job growth, and paltry wage increases are a recipe for sluggish consumer spending growth and a tepid recovery.

Yes, we have high unemployment. High and still rising. Do we have job growth? I hadn't seen that. Thought the statistics reflected a net loss of jobs. Paltry is a good word for wages - are they positive over the past year? I didn't think they were, and would like a citation before granting the use of the phrase "wage increases".

As to consumer spending - an awful lot of people were recently forced to examine just how exposed they are to all but the most favorable conditions. While any number of them have been spared immediate problems, I'd be surprised to learn that, even among the fortunate, there haven't been a lot of sleepless nights. They've had quite a scare. While they may return to the marketplace, it won't be with the same sense of mindless expenditure and absent consequence.

Cinco-X wrote:

Who is it that says that "there's nothing about oversupply that price adjustments won't fix", or something to that effect?

That's Jim the Realtor. Of course, he's not Jim from Detroit.

JP wrote:

Serious question: How does one define "normal credit flows"?

bank loans money - borrower repays the loan????

must be all greenish. ashleymadison is now advertising on tv...

shill wrote:

Dodd unveils bank reform bill without GOP support

Barney and the WH don't support his view on restructing the oversight of FIs, either.

NervousRex wrote:

Argument 3a, followed by rote responses 501, 502, and 509 with options on the 400 series of snarky responses.

I know of folks who deliberately put grammatical and spelling errors in their rote answers to make them "appear" to be written "off the cuff". Just an FYI

some investor guy wrote:

That's Jim the Realtor. Of course, he's not Jim from Detroit.

Right- they say that memory is the second thing to go-

It would also be a good time to confiscate peoples 401k's as was suggested by one of BO's EVIL minions.

"Teresa Ghilarducci, professor of economic policy analysis at the New School for Social Research in New York, testified before Congress last month, proposing that 401(k)s and IRAs be confiscated and converted into universal Guaranteed Retirement Accounts (GRAs) managed by the Social Security Administration."

Healthcare is just the beginning... ( Working on a link )

Cinco-X wrote:

I was under the impression the libertarian leaning commentariat was in general in favor of letting minor offenders, particularly those incarcerated for marijuana, out of prison

Ha.

The Libertarian view is that they'd make good slave labor.

Median home prices fell nationwide in 3Q
Median home prices fell in 80 percent of US metropolitan areas in third quarter of 2009

A real estate group says home prices fell in eight out of every 10 U.S. cities in the third quarter of this year as heavily discounted distressed sales made up 30 percent of all deals.
But home sales continued their climb, with quarterly sales outpacing the second quarter and the previous year's figures, the National Association of Realtors said Tuesday.
The median sales prices of existing homes declined in 123 out of 153 metropolitan areas compared with the same period a year ago. Prices rose in the other 30 cities.

broward wrote:

The Libertarian view is that they'd make good slave labor.

Truly? Back when I knew them, the Libertarians were closer to anarchists who believed that people were angels and could be trusted to deal well with each other without gov't if they were well conditioned libertarians.

Shill --- Nice find!!

Booyyaaahahhahahahah

one way or the other, SS funds are going into the hands of the to buy stock!

Cinco-X wrote:

Isn't this the guy that torpedoed it when it was originally offered by the Republicans,

Yeah right. How quickly the true-believers forget that their own Party are scumbags too. Or did we forget the mantra of deregulation that got us here and the likes of "Chainsaw Phil Gramm". It might be a good idea review the brain's past dogmas.

When ECRI's Lakshman Achuthan came around here to tout their leading indicators, one of the ways I responded was to point out the record divergence between the leading and coincident indices, and that for a host of reasons it is more likely for the leading index to come down to meet the coincident.

Well the ZEW index in Germany is a bit further along that path, EconomPic: Germany: Improving Economy, Idea of Fast Turnaround Fading
edit: the zew doesn't prove me right,... yet. the stock market will have to fall for the leading sentiments to fall

What happens to the "L" when the US government goes bankrupt?

1 currency now -yogi wrote:

Guess what: the States have no Constitutional duty to speedily perform foreclosures, or perform them at all. The right to throw someone off his property because he owes you money is a limited common law right not necessarily involving Constitutional Due Process.

Guess what: the tax revenues that provide the revenue to drive the government wagon at the local level comes from property taxes. Mix in the various transaction taxes for the counties and states too. The current insolvency problem we have is driven by RE concerns which foreclosures are a major part. You are right from an academic perspective, but in the real world, RE/Foreclosure is a major part of the reason that the system is strained via its resources to give you the Constitutional rights you can trumpeting.
.
If you want to work for free to enforce your ideals, you can have at it. However there is the point where the tire meets the road, and right now, the majority of us are more roadkill than safely crossing that road.

Go read Mish.
He's big on privatizing prisons.

re: chainsaw / medicare part d
PCE and PCE less Healthcare as % of GDP via Macro Man

ac wrote:

What happens to the "L" when the US government goes bankrupt?

Are you worried about their printing presses seizing?

Third quarter sales at 338 S&P 500 , reporting, non-financial companies are down 16.5%. So even with the massive global, govi stimulus, sales are down quite significantly. I'll pass on the Kool-Aid.

I suspected as much, sportsfan, but I don't have time to follow the case.

Yagij wrote:

If you want to work for free to enforce your ideals, you can have at it. However there is the point where the tire meets the road,

Yeah, that's my point. Why do you think those boxes are sitting there, the underwater borrowers have more political clout than the banks looking to foreclose? Courts don't run for free; private prisons are a disaster. Been tried.

burnside wrote:

Bob Dobbs,

I'm seeing a similar wave of relocations in SW Florida - retail, office and residential rentals. Business and services are regrouping in the best parts of the city.

As it should be: to the survivors go the spoils.

I like the new use of italics in quoted comments Ken.

Actually, I love the entire comment system. If I was a women I would offer to bear your children.

Are you worried about their printing presses seizing?

Well... inflation is a form of default. Severe inflation is essentially bankruptcy, and has the same effect as bankruptcy -- nobody makes long-term loans anymore, etc.

ac wrote:

seems like a lot of the libertarians I know are otherwise left-leaning drug users

I think these would be the old-school liberals who used to distrust government also. They've pretty much dropped out of politics as there's no place for them to go. (Political Type #4's) Old-School Liberals and real Libertarians generally distrust authority.

They keep developing new flavors and the peoples continue to drink.

some evidence of carry via foreign financial commercial paper issuance via FRB: Commercial Paper Rates and Outstandings

Taken from the Argentine playbook...

Likely to bring out the torches and pitchforks if seriously considered by Congress.

ac wrote:

Well... inflation is a form of default. Severe inflation is essentially bankruptcy, and has the same effect as bankruptcy -- nobody makes long-term loans anymore, etc.

Good point; default without the default. Too bad we're experiencing deflation. Those 1s and 0s just don't seem to have the same impact as crisp Benjamins

shill wrote:

Repeat After Me.... "There Is No Carry"

Yes there is. Until there isn't.

The unwinding of massive volumes of carry trade positions is simultaneously fascinating and terrifying to watch.

China tossed in enough stimulus to grow appreciably. They are in trouble as we are no where near pre-crash levels.

The debt based growth is over!

There is a debate as to whether there is carry trading going on ?? ... please.

Allen C wrote:

The debt based growth is over!

Stimulus spending--at a certain point--will become a drag on growth. Then the fun will start.

I'm a little surprised by the pickup in activity ...

So how was that roast beef any way?

t r orwell wrote:

the dollar bulls are getting so desperate for an excuse to defend the buck that they are using the line that our dollar should be strong because we have the best military in the world.

These folks like the status quo; we need the dollar to be valued more reasonably in order to provide jobs and benefits for people. Their approach is for the benefit of the top 1%.

the dollar carry trade is having an interesting effect in Europe as the Chinese continue to maintain the floating peg.

"will become a drag on growth."

Look at what they are doing. They are basically handing out cash to replace the shortage of income. The cash comes from more debt! How long can this go on? No more than 15 months in my estimation.

"As part of their efforts to promote economic recovery, some central banks have announced they will not raise policy rates for specified time periods. Other central banks have not been as explicit, though they have provided guidance. A comparison of the effects of the Bank of Canada's conditional promise to hold rates steady through the second quarter of 2010 with the Federal Reserve's less explicit guidance finds no evidence that market participants make distinctions between these statements."

FRBSF Economic Letter: Talking about Tomorrow’s Monetary Policy Today (2009-35, 11/9/2009)

Comrade Rally Monkey wrote:

call it a green name like" plantation" , would that be wrong?

Angola anyone? ^shudders^

t r orwell wrote:

Cinco-X, the dollar bulls are getting so desperate for an excuse to defend the buck that they are using the line that our dollar should be strong because we have the best military in the world.

Most dollar bulls, at least on CR, are bulls only in a very short-term sense. The trade starts to become unstable when everyone starts betting against the dollar, and it'd only take a small burp in equities market to create a wicked short-squeeze in treasuries. I'm figuring that'll happen at least once more...and the resulting (artificial) treasury demand will convince Washington that yet another Stimulus package will be warranted.

And that'll be the tipping point between the enhancing and dragging effects of excessive stimulus spending.

Allen C wrote:

Look at what they are doing. They are basically handing out cash to replace the shortage of income. The cash comes from more debt! How long can this go on? No more than 15 months in my estimation.

It's like running out of wood and setting fire to the house to keep warm during the fall. Just wait until winter.

it may take quite a while for financial institutions to heal to the point that normal credit flows are restored.

It would be interesting to get her definition of normal credit flows- liar loans, 105% mortgages, credit card lines to people with no income. Seriously, what evidence is there that current lending conditions are not normal based on historic standards of conservative banking. Kraft has had no problem getting credit to finance its Cadbury purchase, Buffet got money for BSNF

Please post the positive........

Nov. 9:
"About 21 percent of owners of mortgaged homes were underwater, down from 23 percent in the second quarter, the Seattle-based real estate data provider said today in a report. “The decline in the percentage of homeowners with negative equity is a positive sign, and is directly attributable to the stabilization of home values from the second quarter to the third,” Zillow Chief Economist Stan Humphries said in a statement. “It is also attributable to many homeowners who were previously underwater on their mortgage losing their homes to foreclosure.”

Fewer U.S. Homeowners Owe More Than Properties Are Worth - Bloomberg.com

Hmmm... everything down except gold. Is gold even trading today?

Dow 10,206.08 -20.86 -0.20%
Nasdaq 2,144.20 -9.86 -0.46%
S&P 500 1,088.60 -4.48 -0.41%
10 Yr Bond(%) 3.4590% -0.0270
Oil 78.15 -1.28 -1.61%
Gold 1,100.80 0.00 0.00%

crazyv wrote:

It would be interesting to get her definition of normal credit flows

I believe it means innovative financial products which can cause the entire system to crash when someone does something stupid like ask "so how much are these things worth ?".
~splat

splat wrote:

I believe it means innovative financial products which can cause the entire system to crash when someone does something stupid like ask "so how much are these things worth ?".

Why you hates 'Merica?

Nov. 9:
"About 21 percent of owners of mortgaged homes were underwater, down from 23 percent in the second quarter, the Seattle-based real estate data provider said today in a report. “The decline in the percentage of homeowners with negative equity is a positive sign, and is directly attributable to the stabilization of home values from the second quarter to the third,” Zillow Chief Economist Stan Humphries said in a statement. “It is also attributable to many homeowners who were previously underwater on their mortgage losing their homes to foreclosure.”

Fewer U.S. Homeowners Owe More Than Properties Are Worth - Bloomberg.com

BS!!!!!!!!! AND YOU KNOW IT!. Of course 21 percent are no longer underwater!...THEY NO LONGER LIVE IN THE DAM HOUSE!!!!!!!!!!!!!

Good article in the Washington Post today - shows how unsustainable our economy is still becoming, examples show production workers now getting service jobs (air conditioning install, doctors office work). We make less and we change to jobs that produce nothing.

Economy still going downhill. Globalization is not helping us at all. Its only helping the top 1% who buy congress.

Globalization brings a world of hurt to one corner of North Carolina - washingtonpost.com

CalculatedRisk wrote:

To some people that means I'm a pessimist, to others an optimist. I just think it is the most likely outcome.

A Goldilocks Blogger?

CalculatedRisk wrote:

I don't see enough pickup in private final demand to have a strong recovery.

Exactly - no 'pull through'. Until the stuff moves off the shelves [or lines start backing up behind service providers] it isn't really 'growth' and really isn't a 'recovery'... just inventory restocking. And anyone suggesting that is growth hasn't experienced 'constipation'. There is a big difference between inventory accumulation & 'pass through'.

Someone needs to articulate the long term replacement of negative credit growth. If only we used most of the debt for real investment. None of these characters discusses the core issue. Many of us know the reason. There is no easy solution.

Controlled liquidation is the only viable solution. Reflating the un-reflatable is a fool's experiment.

the trade surpluses of the peg-countries are too large, essentially the entire adjustment has been borne by floating currencies as the pegs have devalued against the USD during the crisis. I think the current wave is dependent on a rally in oil, which encourages the bubble in emerging market funds. Then I think we unwind a lot of things. Then there will be more stimulus, and at some point in the medium term the pegs will be forcibly broken. If they keep trying to boost purchasing power of floating countries, all that will happen is for the hot money within floating countries to go into decreasing the peg-countries' domestic purchasing power by boosting the price of anything they need to import (namely food, fuel, basic materials). At that point they can raise their domestic interest rates, reserve requirements, stamp taxes, and it won't help because they are a peg country they have to absorb the domestic/pegged-country interest rate differential. This sorting-out should happen within 1 more year, or 2 years at the outside chance. When it's done, they'll have loads of loan losses, wiped out their reserves, wiped out household savings, loads of spare capacity, wrecked environment, and a few resented people will remain very rich or become increasingly rich through forced consolidation greased by corruption.

Allen C wrote:

Reflating the un-reflatable is a fool's experiment

Why? Who's going to tell the peasants the truth?

noob, congress, our politicians, and the federal reserve have delusions of grandeur about the almighty dollar. They should never rely on the kindness of strangers, but they do. In the meantime, more prime roast beef for da noob also.

Yagij, the Constitution is not taken lightly in the US, despite all you hear. In fact, the reason you hear all the noise is because we take the First Amendment seriously. Of course a military strongman could dissolve Congress and the Supreme Court in a crisis. Andrew Jackson may have come closest.

I have extensive experience in State Court; Housing Court was most of the volume. It's easy to cut the unions' pay, even after you signed a deal. Gov. Christie has the power. But the judge can't go through those boxes very fast, and he won't file the papers or enforce his order. Hire bankers to process their own court papers and you get serious trouble.

I'm not being technical. You say property taxes pay for State labor. Presumably mass foreclosures will magically result in greater property tax revenue. Actually, when the majority of voters no longer own their homes you'll find tax law quite fungible.

We make less and we change to jobs that produce nothing.

our pR0n industry is still the best in the world ! It'll be years before the rest of the world can catch up to our technical dominance in this market.

~splat

EvilHenryPaulson wrote:

the trade surpluses of the peg-countries are too large, essentially the entire adjustment has been borne by floating currencies as the pegs have devalued against the USD during the crisis. I think the current wave is dependent on a rally in oil, which encourages the bubble in emerging market funds. Then I think we unwind a lot of things. Then there will be more stimulus, and at some point in the medium term the pegs will be forcibly broken. If they keep trying to boost purchasing power of floating countries, all that will happen is for the hot money within floating countries to go into decreasing the peg-countries' domestic purchasing power by boosting the price of anything they need to import (namely food, fuel, basic materials). At that point they can raise their domestic interest rates, reserve requirements, stamp taxes, and it won't help because they are a peg country they have to absorb the domestic/pegged-country interest rate differential. This sorting-out should happen within 1 more year, or 2 years at the outside chance. When it's done, they'll have loads of loan losses, wiped out their reserves, wiped out household savings, loads of spare capacity, wrecked environment, and a few resented people will remain very rich or become increasingly rich through forced consolidation greased by corruption.

EHP,
A very nice synopsis. That's really the whole ball of wax isn't it; The peggers buggered the market and as a result, the peggees made bad choices because they "made sense" in the buggered market-

dum luk wrote:

Someone needs to articulate the long term replacement of negative credit growth.

Credit Won't Lead The Recovery - The Atlantic Business Channel

Better yet, see EHP's response above:
Comment by EvilHenryPaulson from thread 'Fed's Yellen on the Economic Outlook'

CalculatedRisk wrote:

I think we will see a decent 2nd half and sluggish / choppy growth next year. To some people that means I'm a pessimist, to others an optimist. I just think it is the most likely outcome... When the stimulus starts to wane in 2010...

I absolutely agree but with one caveat. This only works if we dodge a new stimulus effort. This summer I would have agreed the meddling was played out but it appears more and more that sans negative consequences that FedGov is determined to continue to distort until something breaks. On top of that we've seen both continuing deterioration in States balances and a failure to act on their part. Despite decades of power devolving to a central authority we are still the United States of America and lots of those sovereign entities are on the brink and lacking the power of the press to delay the consequences.

basel too, in the long past, i too lost on nearly all my trades. i gave that game huge amounts of money. that was then. then i quit, did the instrspection work, and started in '04 with a different philosophy. It was the prior pressure on self to win in a time frame I chose to expect, and even responses to foolish comments by others. Now, I know my game. I play it rarely and I only play when I believe the game is in my favor. Missing out on a move means nearly nothing to me. That's why I can say I don't lose. I've posted all my trades since '05 at 2 other blogs, and I post in real time as after the fact, it's just a lie. My postings speak for themselves.

American Apparel, which makes a huge deal about being 'made in the usa', had to layoff 1,300 'undocumented workers' recently. but they didn't announce any hiring at the same time, so maybe that's just their right-sizing to the new normal

I'm inclined to agree with CR's view of the economy, but hasten to add that the financial system presents a very high risk and will continue to do so for the foreseeable future.

I think we have a negative feedback loop. Commission sales are in the crapper and a lot of those cocaine fiends liked to spend money. Everyone below that is basically like selling to fixed income retirees. There is very little hope for workers for raises. They've been lied to for 10 years now, and not everyone works for GS.

I leaned up against the V shaped recovery and fell right off a cliff.

Is that where you've been lately? Well, claw you're way back up to the L. We've saved you a spot.

The physical plants have been sold, disassembled and shipped to China.

Don't forget the environmental laws. Producing anything results in CARBON which is more deadly than dioxins, asbestos and plutonium in the new-green-world-order. Fortunately in China you can just dump any old shite into the rivers or air just make sure the local politico is paid off. It's been well documented that although China has environmental standards enforcement is simply never applied. You can't compete against that.
Couple that to the spike in energy costs with the soon-to-be-law environment bill and we'll be really uncompetitive.
~splat

Just " wow" on this statement by Krugman. I linked a piece yesterday that showed convincingly (with awesome charts like CR does!) the drop in jobs in the FIRE segment at only 6.6 percent. I wouldn't be surprised if it's even better news on Wall Street.

And on the other end of the bail outs, Federal employment in DC is relatively good times with jobs. And that's why businesses are still opening around me in the Columbia Heights area with the housing rental market pretty tight.

Lower job losses, higher profits, increase in pay. I'll fill in the details, Paul. Call me.

Appearances could be deceiving. Also, both NYC and Princeton are likely beneficiaries of the return of big Wall Street bonuses, making them unrepresentative.
Still, there’s the observation: walking around, things look better than I expected.

creditcriminalslovetarp wrote:

Mr. Slippery...your not to far from CR....Salt Creek...good waves even better place to night dive for bugs....

Salt Creek is seriously my favorite surf spot. Never been diving. Bugs?

What exactly does a decent 2nd half entail? 3rd quarter was basically carried by government spending. 4th quarter looks to be not much better than last year. Is that enough to qualify as a decent 2nd half?

I guess it comes down to China is not special, one way or the other.
Having a lot of poor people is not an economic recipe. Look at Africa.
Having a free hand to administrate is not magical. Look at South America.
Having excess investment is only not knowing when to give up on a bubble. Look at Japan.

"deleveraging continues as we speak. "

Yes...and the deleverging bill continues to grow. So far for Q1/2010, we have govi support of FDIC and GSE losses; The end of govi MBS support is folly; and the govi has to once again support the states. This is all before any stimulus and other bailouts.

noob goldberg wrote:

I finally appreciate the appeal of the Amish lifestyle

The Amish can use the internet as long as it's not in their homes (I think). It would give you an excuse to ride the horse to the local cafe and relax with some CR for a hour or two.

You could probably move to the Cook Islands right now, btw, and experience an Amish like lifestyle without all the freezing weather you've got to put up with.

lobster....especially out on the reef and point up the beach...its season right now....

You could probably move to the Cook Islands right now

Island of South Georgia, that makes the cook islands look like Vegas on a saturday night....
~splat

rb wrote:

And on the other end of the bail outs, Federal employment in DC is relatively good times with jobs. And that's why businesses are still opening around me in the Columbia Heights area with the housing rental market pretty tight.

Well, Columbia Heights is still a gentrifying area. I live in a more "established" area of the District (Cleveland Park/Forest Hills) and the rental market here is wide open. Every large building has a sign out front with balloons tied on advertising vacancies. There are many vacant storefronts, even within a block or two of the red line Metro stops.

As for the federal jobs, good luck getting one. I've been unemployed for 8 months now, competing with 300-500 people for every position that comes open. I've got damn good credentials and great experience, but it's not enough given how much competition there is for jobs.

dryfly wrote:

The weak dollar is a good thing - both for us and for the world - folks don't like discomfort but sometimes discomfort is the remedy... but in this particular case it won't fix all ills. It won't produce a lot of jobs here in the US.

I'd only add that any substantial increases in domestic manufacturing capacity would probably need some level of calm in the markets. The volatility in bond, forex, and commodity markets would need to be reduced somewhat before anyone is going to pony up a great deal of their own capital. Otherwise it's simply too easy to stick your neck out at the wrong time--even once--and have it lopped off by the blades of volatility.

I have no data to support this, just my own intuition.

"As a salesman at Moon Valley, Mike Fugitt’s job includes making sure the laborers don’t come into the nursery’s parking lot, because their presence draws complaints from some customers."

I hope "mike" was a large boy growing up.....

Ciao
MS

See http://raphaelkahan.blogspot.com/2009/11/gdp-forecast-update.html and http://raphaelkahan.blogspot.com/2009/10/2010-outlook.html

noob goldberg wrote:

I have no data to support this, just my own intuition.

Its accurate I believe BUT for now 'new' capital isn't required - its out there in spades already. Just needs to be reallocated. The hold up there is that the folks holding the capital won't sell because the bid-ask is too wide. So it sits stranded. And when those holding the capital [hedgies & PE primarily] start to feel pressure they get bailed via Alphabet Soup [WS banks to Hedgies & PE: "Sit tight - this too shall pass..."].

So it isn't just comm & res RE that isn't seeing a 'market clearing' - the whole industrial sector needs to see the same kind of clearing and reshuffle of capacity before output can be expected to increase greatly.

Still won't result in a lot of jobs though - the new players will automate & fixture more aggressively than the old players - I see it first hand everyday.

dryfly wrote:

The plants are getting more & more lights out every day... and it is spreading both ways... down the supply chain and up through distribution. Also fewer bodies required in 'support' [offices]. Fewer bodies needed everywhere.

So the endgame of productivity is no jobs.

Fool me once (1999) shame on you
Fool me twice (2007) shame on me
Fool me thrice (2009)... and I am such a f***ing idiot.

MarketWatch.com

MS wrote:

"As a salesman at Moon Valley, Mike Fugitt’s job includes making sure the laborers don’t come into the nursery’s parking lot, because their presence draws complaints from some customers." I hope "mike" was a large boy growing up.....

We have that here, too, at the local lumberyard; but the cops enforce it at the merchant's complaint. The "laborer's pool" has become an informal street institution here, knows it, and minds its Ps and Qs.

It has always been a Latino institution, too, illegals and out-of-work farmworkers. Read an article out of Vegas that Anglo faces were beginning to pop up in the laborer crowds outside their Home Depots, so I slowed down when I passed by the lumberyard the other day and did a count. Sure enough... 5-10 percent.

yagij wrote:

Isn't that the affair gal?

Think of her more as an employment guarantee for the family law practitioner...

shill wrote:

Unless of course someone know's of another planet upon which we can build on and some Alien population wants to finance the building process.

I do, but to get there would require a significant public investment in technology, R&D, academia, and infrastructure. A few hundred billion or so should do it. Maybe we can build a space elevator and mine the moon for He3 while we're at it.

Ambac warns it may file for bankruptcy

Just " wow" on this statement by Krugman. I linked a piece yesterday that showed convincingly (with awesome charts like CR does!) the drop in jobs in the FIRE segment at only 6.6 percent. I wouldn't be surprised if it's even better news on Wall Street.

And on the other end of the bail outs, Federal employment in DC is relatively good times with jobs. And that's why businesses are still opening around me in the Columbia Heights area with the housing rental market pretty tight.

This morning - primarily because I was curious - I went back and charted private-sector employment as a percentage of the labor force, using the BLS seasonally-adjusted household data going back 30 years. If I were Obama, or in his cabinet, this is how I would demand the "employment" picture be drawn ... i.e. include farmers and small business owners, but exclude gub'mint bureaucrats.

In October, 74.7% of the labor force were employed in the private sector.

By way of comparison, this number was 75.2% in September, 78.1% last October, and 80.3% when the recession began in Dec. '07.

It's already at lows we haven't seen since 1983 and is falling at an unprecedented - and still increasing - velocity. We got as low as 72.1% in Dec. '82, but unless the economy pulls up we'll blow through that figure by early next year.

Krugman's statements are meaningless - he might as well base those observations on a day spent riding the Metro between Chevy Chase and Federal Triangle.

The private sector continues to bleed to death.

Now here is some good news.....good for FORD

Ford note sale raises $2.9 billion

Ford note sale raises $2.9 billion - Business First of Louisville:

mp wrote:

If anyone saw my risk matrix, they'd probably sit down and weep.

I thought I was the only one left doing risk matrices.

Anyway, This is where casual readers get confused about the attitudes in the comments. Many of us are belt and suspenders types and don't hesitate to speculate on "what's the worst that could happen?" Too often that gets misconstrued as prediction and not as its true function as limits.

Right now my largest concern is an apparent failure to learn amongst the leadership. There's a reason you get three strikes in baseball. What I don't see is any willingness to revisit original assumptions and that is what can trip us up.

burnside wrote:

So the endgame of productivity is no jobs.

or whatever jobs there are can demand higher pay in real terms. Whatever we produce, it's just a matter of what the share between capital and labor is. Probably going to swing back to labor since the system needed accelerating debt to balance the books by the end. Mind you that share should be a time varying number, dependent on the demographics of labor force:population

So the endgame of productivity is no jobs.

No, the end game of productivity is illustrated in the movie The Terminator (except without the happy ending).

The individual Brit who did the most valuable work fighting WWII was arguably the guy who cracked the Germans code. Probably a math geek of not much use on the battlefield (nothing to do with his homosexuality, for which he was later vilified), how do you price his "labor"?

"Jobs" are useless if they don't add value.
A healthy, sheltered, literate population is valuable to a nation, as is competition for bonuses awarded to those that add more value.

Executive summary time:

1) The places Krugman (and myself and CR) hang out are looking up.
2) The places THE LOSERS are, aren't.
3) The falling dollar won't help short term, but when effect does kick-in it won't help unemployed because of automation (which isn't much help, really)
4) The peasants are LOSERS!!!! GET A JOB YOU HIPPY, AND GET A HAIRCUT.
5) TPTB are doing what they know how to do.
6) Noob is going Amish on us.

energyecon wrote:

Isn't that the affair gal?

Think of her more as an employment guarantee for the family law practitioner..

http://ashleymadisonbio.com/

Rob Dawg wrote:

Right now my largest concern is an apparent failure to learn amongst the leadership.

What is for them to learn? You learn by failure. Have any of THEM failed yet?

Edit: The dumbasses keep electing THEIR glorious political leaders over and over and over and over and over again.

bonuses are good for shift-work, usually decreases performance for non-robotic tasks

dum luk wrote:

“It is also attributable to many homeowners who were previously underwater on their mortgage losing their homes to foreclosure.”

now that is a !

The Lew Rockwell Show - 142. Is the US Government Too Big To Fail?

woof!

That's "Ruff"

Comrade Misean is Dope wrote:

I think will have a post Grinch Whoville Christmas without the singng and dancing around the missing Christmas tree

Been missing you around here, Misean...nice to have you back, sunshine

Bob Dobbs wrote:

stand up well to strong nationalistic movements,

Actually the lesson of the decline of the British Empire is what happens when you allow a few right wing jingoists to drive policy. The Jewel in their empire would have settled early on for Dominion status and home rule. Much like I believe the Irish would have. However, rather than reaching an accommodation with moderates the imperialists brushed them aside leaving the field open to the ultra nationalists who would settle for nothing less than independence.

However, interestingly in most of the Empire they ceded they never sent of with a hail of bullets and until Britain decided to throw her lot in with Europe the Commonwealth meant something. (BTW why in American English is it learned but not learnt but meant but not meaned ?)

The British Empire was an empire on a budget; there weren't many of them, they depended on co-opting a particular class or ethnic group to be their straw-bosses -- that, and mercenaries and colonial levies. That sort of empire doesn't stand up well to strong nationalistic movements, because the illusion of power evaporates quickly if the locals stop cooperating. The Brits' policy of backing one ethnic group to rule over the others also brought tensions that bred unreset. And bloody civil wars/holocausts as the governed got their own back against the former strawboss class -- Sri Lanka, Rwanda, Nigeria, others.

That Tainter guy IIRC had some interesting stats on the British Empire in his book regarding the scalability of bureaucracy. It seemed like part of the story was that cost of bureaucracy increased at a faster rate than the size of the empire and began to have trouble paying for itself, which suggests that management overhead doesn't scale linearly with size.

Studying now defunct Soviet bureaucracies seems to reveal a similar relationship between sheer size and management overhead (think about how at small companies the CEO often interacts directly with most of the staff, but at very large multinationals communicates only indirectly via multiple tiers of management prone to miscommunication and overabstraction).

yuan wrote:

http://www.ritholtz.com/blog/wp-content/uploads/2009/11/State-Tax-Revs-Economic-Changes.png
The discrepancy between UE and state tax revenue suggests (to me) that our government is lying to us on an unprecedented scale.

That, or perhaps it's the dark side of a progressive tax scheme.

burnside wrote:

dryfly, I'm a musician. Very flattering. Thanks.

I actually said that to my sister last summer [she was liberal arts - now writes history... both her kids are liberal arts... theater & chinese history]. I told her we'll need more of them and fewer engineers & factory workers like me & my kids if the trends I see continue - her jaw about hit the floor... because it was a complete 180 from what I had been saying for the previous two decades.

But hell - we'll be nearly totally lights out in some of the firms I work with - people just get in the way - some have even put plants out on the floor because they are so empty - so when customers tour they aren't freaked out - seriously.

What else are the people gonna do? Watch reality TV all day?

yuan wrote:

The discrepancy between UE and state tax revenue suggests (to me) that our government is lying to us on an unprecedented scale.

I don't know if they are lying but whether the statistical gathering process is just out of kilter. As some have remarked the strong chain store sales maybe not a reflection of underlying strength but just the elimination of the mom and pop stores with their sales gravitating to the chains. This version is certainly backed up by the sales tax receipts. Since this whole economic slow down is a credit related event something that we haven't witnessed in 80 years it is almost certain that the statistical sampling will not cover what is unique about it.

crazyv wrote:

All those forecasts are based on the fact that the income of those still employed has gone up in 2009 offsetting to a large extent the decline in employment.

OK, clarification please...you are saying raises for those who still have jobs (in aggregate)?

wally wrote:

Rob Dawg always wanted to be a veterinarian.

Who knows what I'll be if I grow up.

yuan wrote:

The discrepancy between UE and state tax revenue suggests (to me) that our government is lying to us on an unprecedented scale.

Report shows states' revenue sources

ac wrote:

Fortunately Krugman and his ilk "saved the cancer patient from having chemotherapy".

My concern is that they have saved the tumor (financial sector) and let the patient go hang (real economy).

Gee, people don't have jobs, so it may be hard to spend...I know, I know - Why don't we just lend people money, whether they can pay it back or not???
O...yeah....we tried that ...and it didn't work.