Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: SouthFloridaGuy who wrote (99747)	7/16/2009 11:36:23 PM
From: Little Joe	Read Replies (1) \| Respond to of 116555

You may be right. On the other hand it might be a good idea to review the charts after 1929. lj

To: SouthFloridaGuy who wrote (99747)	7/17/2009 12:28:20 AM
From: mishedlo	13 Recommendations Respond to of 116555

Odds of a V-shaped economic recovery are zero. The stock market is not the economy no matter how much you might think that. Unemployment will be rising for months to come and will probably come close to 11% if not exceed it. Your laid off friends do not constitute the economy. Mish

To: SouthFloridaGuy who wrote (99747)	7/17/2009 12:40:09 PM
From: Dan3	5 Recommendations Read Replies (1) \| Respond to of 116555

Re: My laid off friends on the Street are now being picked up very quickly There was a $700 Billion government stimulus. A little over $600 Billion of that went to wall street. It's not a shock that some of the laid off wall street workers are being re-hired. But the rest of the economy and the rest of the unemployed? Forget it... (you know, like congress did).

To: SouthFloridaGuy who wrote (99747)	7/17/2009 4:37:06 PM
From: gregor_us	11 Recommendations Read Replies (2) \| Respond to of 116555

As the next leg down in California real estate unfolds, and it has indeed already started and it's going to be very painful, I think the state unemployment rate has a very good shot of reaching 15.00%. Only 3.4 points to go. So, my call is hardly aggressive. While there may be enough liquidity in the system now to push up prices of certain global assets, I see US real estate--especially from current levels which remain quite high--as being the least likely of potential recipients. Like many, I have studied very carefully the structure and the trajectory of the decline, especially in places like Michigan. Starting earlier this year, I began to wonder if the horrific type declines seen in MI could be visited upon certain places in the West. I now think the risk of that happening is high. The disease has now busted out from the Central Valley, and has moved and crept right into places like the Bay Area. Take a look at Concord, CA which have already seen bread and butter ranches fall from 500K to 200K. I predict they're going even lower. What you realize is that a ranch house in Concord, CA even near BART offers the following: zero. There's no job growth in CA and there won't be for a long long time. The source of the problem is actually much broader than the ravages of the burst bubble. Alot has to do with the classical structure of collapse, and how diminishing returns has now set in fully on most of CA's post-war infrastructure. Simply put, CA was built out in the fattest part of the cheap oil era. It's not that different than AngkorWat that was built on top of an elaborate water-pipe system. Give California 25 cent gasoline for two years, and the core-structure on which it depends would be profitable. As it stands, CA is almost perfectly the wrong scale, the wrong size, and is built in all the wrong ways to get out of its current hole. Though, it would help alot if they legalized marijuana, and also drilled for oil--not to use the hemp or oil but to raise the capital proceeds from each. No V shape recovery is possible with energy prices where they are, and, the amount of debt still out there. Though, if FED would simply credit every tax paying American 150K against a submitted schedule of current debt, we might have a shot at reviving demand. My most benign outcome for the US next 12 months is an export surge that hits the interior of the country on the back of a weak dollar. Aggie and Light Manufacturing exports (electronic components) could get the juice flowing a bit. In this scenario we do a kind of replay of 2H 07 and 1H 08, with terrible jobs and housing conditions rolling onward beneath an export pop. Then the mix of inflation and deflation, which imo has been the reality all decade, crashes again in 2H 2010 in much the same fashion as it did last year. Only this time instead of Lehman Bros what goes down in the Federal Reserve. I know that is all awfully gloomy and terrible, but, the current situation is quite unusual. Though, in the longer-cycle view of societal and systemic collapse, what the US faces is fairly standard. Given that we went into overshoot nearly 9 years ago, the idea that the Federal Reserve will not--cannot--survive this situation is frankly rather unsurprising. G