Reality Bombs Vs. Greenshoots....
From Alan Greenspan, the best Central Banker Money Can Buy...
bloomberg.com;
May 21 (Bloomberg) -- Former Federal Reserve Chairman Alan
Greenspan signaled that the financial crisis has yet to end
even as borrowing costs tumble, warning that U.S. banks must
raise “large” amounts of money.
“There is still a very large unfunded capital requirement
in the commercial banking system in the United States and
that’s got to be funded,”
Greenspan said in an interview yesterday in Washington. He
also said that “until the price of homes flattens out we
still have a very serious potential mortgage crisis.”
Greenspan’s comments suggest he sees a bigger capital shortfall
in the banking system than reflected in regulators’ stress
tests on the 19 biggest U.S. lenders.
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Translation: Geithner's Stress Test Is A Complete Joke.
And more reality bombs from the LEI (Leading Economic Indicators)...
We have yet to see the ripples in the economic pond from
the bankruptcies of Chrysler and GM.
And those are two large assed butterflies about to flap
their wings...
Anyone want to bet the farm that Ford is out of the woods,
and won't come calling for TARP money?
Then there's this news on Japan from the RGE Monitor...
rgemonitor.com
"Q1 2009: Japan's GDP posted an epic contraction of 15.2% y/y
and 4% q/q - the largest drop since records began in 1955 and
the fourth straight quarter of negative growth. Being the most
trade-dependent, Japan suffered the worst contraction among
major industrialized nations in Q1 2009."
Then there's California.
The State is in economic free-fall and is asking that you and
I bailout public employees who make what a good family physician
makes, and who retire with the fattest pensions in America,
with gold-plated benefit packages for life.
Ain't no #@%$ way.
I didn't get those cool ocean breezes.
I didn't get 325 days a year of 70 degree sunshine.
I didn't get a quadrupling in my home price since the 1990's.
And I'm not going to bail out you, your Disneyland lifestyle,
or your runaway illegal immigrant welfare state and public
employee golden slop trough.
And after California, you can count on Michigan, Illinois,
New York and others soon to follow.
And I will repeat:
The biggest story in 2010 will be collapsing tax revenues
and state & local governments in crisis.
Message 25619884
"... another HUGE shoe that's going to drop like a lead
balloon in 2010 - collapsing city and state budgets.
Tax revenues are cratering. Cities and States got Fed bailouts
and tapped reserves this year. I've talked to a couple of
well placed people locally, and they are already telling their
city & county employees... "we can not guarantee you that
you'll have a job in 2010. You're fine through year end...
but, make plans for 'the worst' next year, because there will
be substantial cut backs and layoffs."
State & Local governments are among the largest employers
in many communities. I believe one of the biggest stories
in 2010 is going to be the catastrophic budget and job cuts
for state and local workers.
People are getting tired of government employees getting
cost of living, or automatic 4% annual pay raises with
generous pensions and gold-plated benefit packages.
Try passing another $800 billion dollar stimulus next year to
bail out state and local governments that are raising taxes
and nickel and dimeing the citizenry already."
SOTB |
