-"Something different to economy this time" - Greenspan
-Lowest consumer confidence since 1996 and sharpest downturn with back to back quarters that have been seen in 50 years.
-Lending - tightens at fastest rate in a decade.
-Fed 100pt cut steppest since deep recession in 1981 to 1982.
-Layoffs - in Jan. 270,000, up some 678% over Jan. 2000. 'ISI Group'
-Default rate amongst speculative grade bond issues is approaching 9.5%, that would be the highest rate since 1990, when defalts surged in a recession.
-For investors, the only important question is how much of the bad news, present and still to be accounted for, is in the market? Not very much, say Jay and David Levy, father and son and a really bright and perceptive pair of economy watchers. In their Levy Institute Forecast, they contend that "investor expectations and where profits are headed" are at considerable remove from from each other. They anticipate earnings will be worse than expected in the first quarter and will 'in all probability nosedive in the second half." And, for good measure they add that "2001's fourth-quarter earnings decline could be the steepest in postwar history. And 2002 may be scary." 'Barrons,02/12/01'
-During the first week of January, investors poured $67.7B into money-market funds. That's the largest increase in three years and brings the total assets sitting in money-market funds to an all-time high. $49B of that money came from institutions. 'Investment Company Institute (ICI)'
-Caught some statistic that new home mortgages were for upwards of 85% of purchase price, in addition there were record numbers of refinancing to pull equity out of real estate investment. Try to find the article later, but interesting trend. Saying something to the tune that consumers have become accustomed to utilizing stock market gains to pay bills and fuel their spending.
Anyway, just more tidbits to ponder. Short, live long and prosper.
West |
