Mish:
As he so frequently does, Richebacher took the recent US employment numbers and shredded them. Putting it nicely, those numbers are as bogus as the GDP numbers. Just to touch on one point,..... the total number of hours worked in the period was DOWN! Say what? The rascals used the birth-death ratio to weave a bit of badly needed magic. Ho, ho, ho.
At this end, I think we are on the verge of "the great US consumer melt down" and I am betting accordingly. Many times in the past, I have commented on the importance of keeping track of real employment and consumer lending. Employment has been in linear descent mode for a couple of years now and the general population has crossed over from not worrying enough about it to worrying a great deal. Employment worries equate directly with reduced consumer spending. At the same time, the gigantic contribution provided to continuing consumer liquidity by the "refi game" is now at an end. With most of last year's tax benefits also long since spent, where does the indebted consumer dredge up a new source of dollars? Methinks he is (finally) "tapped", and when he reaches that point, the urge to try to climb out of the debt cellar gets underway...... via "saving" (hope I spelled that word correctly), which is the Fed's worst nightmare come true. I think the current insane stock market valuations have reached that proverbial "nipple in the wringer" stage, which means that the current pain is nothing compared to what's coming.
Best, Earlie |
