Tuesday, August 11, 2009

SAR #9222

Calling 'em 'consumers' don't make it so.

Don't Say You Weren't Warned: Back in the day, PE ratios of 20 or so were high, 10 and below low, and 14 about right. The S&P 500 is currently above 140. No wonder CEOs and their friends are selling every share they can: the score: Buyers $13 million, Sellers $1 billion. And it's damned near the last inning.

Death and Taxes: By their actions, it's obvious that conservatives believe that taxation is more immoral than allowing people to die for lack of health insurance. Tens of millions of people have no insurance, tens of millions more have useless insurance that's only good until they need it. The Obama reforms would mean everybody get could comprehensive insurance at a price they could afford. And the GOP is against this idea - what's the point of being rich if you can't live better and longer than the unwashed?

New Indoor Record: There were 126,434 consumer bankruptcy filings in July, up 34% y/y and 8% m/m, The most since the GOP made bankruptcy nearly impossible in 2005. The 2009 total is expected to be about 1.4 million - pretty close to the 1.5 million unemployed who will exhaust their benefits by year's end.

Parts Is Parts: The UK Food Standards Agency says that organic food offers no nutritional value over other sources. Poisons are another matter, as is taste. But your basic nutrients can come from pills - and cheaper than organic tomatoes, too.

And Then There Were None: If there were 100 workers and you've already fired a bunch of them, there simply are fewer of them to let go next week, so of course the number of people losing their jobs goes down. There are 6.6 million fewer people employed than two years ago, so the pool is shrinking.

On Balance: Exxon, DuPont, Peabody Coal - the fossil fuel and chemical giants and their friends in the GOP have decided that saving us, our civilization and the planet is not in their best interests. Get some sunscreen.

Another Shoe: At the end of July, 3% of US commercial mortgage-backed securities were delinquent. Delinquencies are expected to nearly double to over 5% by December and over 6% in 1Q2010.

Automatic Theft Machines: When you step up to the ATM swipe your card and withdraw $100, the bank knows if you have $100 in your account. But even if you don't, or especially if you don't, they are happy to give you the money. Because they make $38 billion a year from overdraft fees. They could flash a warning that continuing with the transaction will cost you 5,000% interest, but that would cut into their profits. And then they'd have to ask Tiny Tim for more bailout money.

Survival of the Fit: Columnist Ben Stein claims the NY Times fired him because he is a Creationist. Works for me.

That Sinking Feeling: Greenpeace is planning to sink over 150 1 to 2 ton boulders into two protected areas off the Swedish coast, to discourage cod fishermen from trolling in the sanctuaries. The fishermen complain this will keep them from fishing in these waters. Dhuh.

Succinct: Traders Brace For September Collapse


Demetrius said...

Way way back, well ten years or so, I asked my tame software engineer how come P/E ratios in all this internet/computer stuff were so high, nearly 100, and people were still buying. Especially in a trade with high technology turnover and low bars to entry. He told me the buyers were clinically insane. Turned out he was right.

OSR said...

I'm not sure that clinical insanity is relevant to the current market. Whether it's toilet seats or AIG shares, the government has a long history of overpaying for its purchases.

fajensen said...

Earnings does not matter because the government/FED is willingly swapping turd holdings into fresh cash for another go at the Ca$ino.

Market behavior is quite rational too: Given infinite money the probability of winning the lottery is exactly 1!

"New Economy" reincarnated. Indeed - all we need now to complete the cycle is economists explaining why this can go on for ever ...