Heinz looking for consumer led recession possibly starting NOW
Date: Thu May 27 2004 12:40
trotsky (the housing bubble) ID#377387:
Copyright © 2002 trotsky/Kitco Inc. All rights reserved
judging from the recent ominous combination of data ( steep plunge in new home sales, coupled with a record supply of new homes on the market - what happened to the fabled 'shortage'? ) , it is time to consider the possibility that the housing and mortgage credit bubble has finally begun to burst. if so, then the consumer recession is beginning RIGHT HERE AND NOW. it should be far worse than the business recession that preceded it, at least in terms of the popular economic data. it also means there won't be more than one rate hike, if there is one at all.
it has however also other, far-ranging implications, e.g. for the bubble economy of China, and with it the recovery of Japan, and commodity prices. gold should reassert its 'safe haven' role in this scenario, as opposed to its 'reflation hedge' role.
Date: Thu May 27 2004 12:45
trotsky (something else to consider....) ID#377387:
Copyright © 2002 trotsky/Kitco Inc. All rights reserved
while the demise of the housing bubble isn't yet a done deal, assuming that it IS beginning, one must also consider what that would do to the stock market. imo it would pulverize it in no time at all. the relevant historical example is the Nikkei when Japan's real estate bubble bit the dust. a year's worth of recovery rally was given back in the space of a few weeks.
Date: Thu May 27 2004 12:10
trotsky (OZN) ID#377387:
Copyright © 2002 trotsky/Kitco Inc. All rights reserved
yet another batch of stunning drill results:
biz.yahoo.com
Date: Thu May 27 2004 10:05
trotsky (frustrated@jobs data) ID#377387:
Copyright © 2002 trotsky/Kitco Inc. All rights reserved
you're fogetting that a huge number of jobs in the payroll survey data that BLS publishes once a month are simply invented. there are several methodologies being brought to bear, inter alia the one that pumped up the last number by a cool 270,000 jobs - namely an assumption as to how many new businesses are created ( vs. those lost in bankruptcy ) in the alleged recovery. if indeed more new businesses are founded than lost, then one would assume that they'd create additional jobs. however, it's all estimates...none of it is in any way shape or form provable.
'seasonal adjustments' are another statistical feature distorting the numbers. see, the hoi polloi in the financial markets are not to be trusted with their ability to comprehend that there is e.g. less construction in winter than in summer. no, they need the govenment to fudge the numbers in such a way that these seasonal features of the labor market are 'smoothed out' of the published figures. of course this is an open invitation to mischief, i.e. an incentive to produce more pleasing ( to the political masters ) numbers. what is however certain is that the true state of unemployment remains a mystery...one can only guess, my rule of thumb is to take their percentage and multiply it by two.
btw., they obviously do NOT take the record high bankruptcies into account. it's not so much about producing a correct number, but rather a 'nice' one. similarly, the practice of using 'owner-equivalent rent' for the shelter component of the CPI is a blatant deception that is downright shameful. isn't the government often heard trumpeting the fact that over 70% of households pretend to own their own home? so why then would a wild house price bubble not be deemed a worthy addition to the CPI?
it really has gotten to the point where practically ALL government data have to be either discounted, or laboriously reinterpreted. they simply make no sense ( although almost everybody seems to be convined that they do ) . of course, this is not without consequences. by dint of this false image of reality, economic decision making is impacted to some degree. especially the bureaucracy ( i.e., e.g. the Fed ) will be prone to even more error than it is already prone to by its nature.
as for the history of this boondoggle, th politicization of economic data began in earnest under Bush senior, was perfected under Clinton, and happily inherited by Shrubco. |
