Even prophets are occasionally right.
That? Oh, That: That hissing sound you hear off to the left, that's the Japanese sun setting in the far west. How far west? Down about 13% and falling. The stereo effect on the right is coming from Germany.
Takes One the Know One: Why did Wall Street executives who knew about Bernie Madoff's fraud keep quiet? Maybe because Bernie knew about theirs.
Preprivatization: The step formerly known as nationalization, phrased so Republicans can support it. This gilding of the lily is necessary because the 4 big banks (BofA, Citi, WF & JPMorgan) need about $450 billion and have a market capitalization of $200 billion. The US can either (a) give current shareholders a $250 billion gift, or (b) nationalize the banks. But it can't do (a) without a taxpayer revolt or (b) without a Wall Street/GOP revolt. What's behind door #3?
Headline: The war in Iraq isn't over. The main events may not even have happened yet.
Global Hamburger: Scientists report that growing and grinding and getting that hamburger to you causes as much global warming as driving your car for a couple of days. So walk to the burger joint, would ya? Else we're doomed.
Devil/Details: Deals on new cars are falling through because the value of used cars has plunged to where trade-in values are often much less than the remaining loan balances. Just like their houses.
Export/Import Fever: Net oil exports from Canada, Mexico and Venezuela (prime suppliers to the US), 5 mbd in 2004, have dropped to 3.9mbd in 2008. That is an ongoing annual decline of 6%, which is not good news for it means the US has about 10 years to find another supplier or do without.
The Day the Money Died: Thursday, Sept. 18, 2008, Bernanke and Paulson told the Congressional leadership that the US economy was in grave danger of a complete meltdown within a matter of days. We have been moving ever further into a command economy ever since.
Ponzis R US: The Fed's latest study of household weath says (a) there isn't any and (b) there hasn't been since 2000 and that all those notices we got from the Bush economy were about as valid as Bernie Madoff's, and that we cannot actually spend our way to riches. I hope a copy of this report gets to Congress soon.
In the Cards: Customers are using their credit cards less frequently and their average purchase amount has declined by 5.2% in the US. Payments on outstanding balances have also stalled.
Bigger than Madoff: The US Special Inspector General for Iraq Reconstruction is investigating the role of 'senior military officers' in the misuse of $125 billion in Iraqi reconstruction funds. This may turn out to be the greatest monetary fraud in US history. The invasion itself was the biggest fraud in recent history.
Reminder: Jonh McCain, GOP Senator from Airizona, lost the presidential election to the other guy by very big margins. Some one should tell him.
Census Consensus: Why is the GOP making such a fuss over the next census? Because they are afraid an honest count will weaken them in that minority of districts where the ditto heads are now in the majority. They've always thought they were an oppressed minority, even when they were in the majority. Now their paranoia is at panic level, and they really don't want all those potential Democrats counted.
Porn O'Graph: Real retail sales declines.
1 comment:
Re: Devil/Details on why interested, but underwater, car buyers walk out of dealer showrooms.
http://treas.gov/initiatives/eesa/agreements/auto-reports/GMRestructuringPlan.pdf
From Page 50 of GM's "homework" assignment, which even no self-respecting dog would eat, is its assessment, once again, of WHY IT'S NOT OUR FAULT:
"Many potential buyers are not able to buy due to credit conditions, so once credit market returns (sic) to normal, the release of pent up demand will actually increase sales."
(Yes, they actually used the word "actually.")
If by "normal," GM means the halcyon days until 2008 when GMAC and others would lend 120+ percent of a new-car sticker price for 72 months to any "underwater" buyer with a credit score north of 3, knowing they could package the dreck and sell it to small towns in Norway, they may be waiting a long time.
120+ percent loan-to-value credit terms, like so many vestiges of our golden era of finance, now are historical artifacts to be studied intently by future economic archaeologists.
It is no wonder the auto industry was able to distribute more than 50 million vehicles between 2005 and 2007, aided and abetted by what GM, apparently in all seriousness, describes as "normal" credit markets.
Those of us who will remain lucky to be employed, so as to continue making current car payments, likely have one-to-five years remaining on our auto loans, so GM's make-believe forecast of U.S. auto sales in 2009 and 2010 of 10.5 million units and 12.5 million units, when the final three months of 2008 fell off the 9 million units cliff, is pure comedy.
And once these loans are paid, assuming we own free-and-clear, still-functioning vehicles, how quickly will any of us want to re-enslave ourselves for another 5-6 years just to get that new-car smell?
Stick a fork in these guys, they're done, but just don't stick in any more taxpayer dollars borrowed from China.
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