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Politics : Liberalism: Do You Agree We've Had Enough of It? -- Ignore unavailable to you. Want to Upgrade?

To: Kenneth E. Phillipps who wrote (114612)	10/4/2011 4:18:37 PM
From: Jorj X Mckie	5 Recommendations Respond to of 224750

A sinking tide lowers all boats. The Democrat mantra and strategy to achieve equality for all.

To: Kenneth E. Phillipps who wrote (114612)	10/4/2011 7:01:14 PM
From: Hope Praytochange	2 Recommendations Respond to of 224750

The Bear Market is Made in the U.S.A. Greece's situation is hopeless, but not serious. U.S. stocks reflect the weakness of the U.S. economy. Sell in May and go away" is the hoary cliché that proved prescient this year for stock traders. The Standard & Poor's 500 peaked around May Day, along with Odumbama's popularity with the termination of Osama bin Laden, and it's been downhill for both since. The S&P 500 closed within a percentage point of the conventional definition of a bear market Monday, down 19.4% from the April 29 high. Other measures are off much more, such as the Russell 2000 index of small-capitalization stocks, which is down nearly 30%. The putative reason for the declines has been the political wrangling on both sides of the Atlantic, fought mainly over fiscal matters, that would qualify as farce if it weren't so deadly serious and indeed tragic. America saw the loss of top triple-A credit rating following the unfunny spectacle of the debt-ceiling bluster talk during the summer while Europe remains enveloped with the never-ending efforts to stave off a default by Greece and a debacle of the Continent's banks. But the proverbial observers from outer space, agnostic in their expectations or presumptions about economies and markers, would likely have come to a simpler explanation for the gyrations in financial markets. The decline in U.S. stock prices (and in bond yields) has roughly paralleled the slowing in the American economy, as measured by the gauges from an outfit that has reliably called turns in the business cycle. The Economic Cycle Research Institute Friday declared that a U.S. recession was all but unavoidable, as reported in the Current Yield column of this week's print edition of Barron's. ECRI's call is based on a compilation of measures from the firm founded by the late Geoffrey Moore, who was called the father of leading indicators. ECRI's Weekly Leading Indicator plateaued last April and began to show serious signs of deceleration in May, coincident with the peak in the stock market, which itself is supposed to be a leading indicator. Of course, stocks supposedly have forecast something like nine of the past five recessions, according to the quip by the late economist, Paul Samuelson. This time, however, stocks' slide has been corroborated by the sharp drop in industrial commodities, notably copper, and the action in the bond markets. The plunge in Treasury yields, with the benchmark 10-year yield cut by more than half, from 3.74% in February to 1.77% Monday, anticipated the continued torpor in the economy. That contrasted with the conventional wisdom earlier in the year that a smart rebound would be under way by now. Moreover, credit spreads -- the extra yield on speculative-grade bonds to compensate for their greater risk -- also have widened to levels associated with a significant downturn in the economy. Even though the near-bear market in U.S. stocks is entirely consistent with the deterioration of growth prospects in the American economy, the connection is denied. The S&P 500 no longer moves in lock-step with U.S. gross domestic product, which is the result of nearly half of those companies' revenues coming from overseas. But the bigger decline in the Russell 2000 small-cap stocks, whose business comes primarily from within U.S. shores, would seem to reflect more accurately the state of the domestic economy. i