i remember when these used to have themes

[solarbird]

Good evening. Remember when 1% was considered a big move in equities and stuff wouldn't happen for a day or two or even a week? Yeah, I do too. That's when these had themes and I wrote little mini-essays sometimes on single topics. Ah, well. Maybe again someday.

Minyanville's Kevin Depew has an article on the Federal Reserve Bank's actions w.r.t. issuing its own debt. On page two of that article is the latest in their long-running series on attitude change prompted by economic implosion; recommended. You're also seeing a return of local currencies in several cities. This is something fourth generation warfare researchers support, by the way, as a locally stabilising factor in the event of major crisis. They tend to pop up in bad economic times. Mostly, they don't last.

Stock indices bounced off the same moving average trendline that I pointed out last post for the third straight day. Stocks are still in "oversold" territory, however, so at least a fourth attempt will almost certainly be made tomorrow. Still, real news matters more than fake news technicals, and Mish's economic potpourri for the 10th includes projections of a 1% drop in consumer spending in 2009, the worst result since 1942, along with projections of S&P 500 lows going down as far as 400 some time after this bear market rally.

The Baltic Dry Index - which rose a little today, heading back up into the upper-600s - does not lie: Brad Setzer has hard numbers on shrinking global trade. The Economist's story on this is atypically dire and shows the breakdown is in all sectors with all regions. The Wall Street Journal reports major cutbacks by trucking and other freight hauling companies.

In get-your-rage-on news, semi-nationalised insurer AIG wants Another US$10 Billion in taxpayer money from the Federal government. Why? More bad investments. Meanwhile, they just keep looting the company, with individual upper management "retention" payouts now reaching US$4 million. And the auto bailout programme could trigger a whole new set of credit-default swap payouts.

Over in government instrument news, two months into Fiscal Year 2009, and the US budget deficit has already broken US$400 Billion with a B. And the Treasuries situation is being described routinely now as a bubble; watch out for that popping soon. The dollar is establishing a trendline down towards 85, and appears to be likely to test its mid-November recent lows; the current actual Fed Funds Rate at the discount window is .12%, not even close to the 1.00 target.

Finally, at the local level, Goldman Sachs is recommending credit-default swaps against several US states. That's fun! Too bad you can't use local currencies to pay taxes, ne?

Comments

[maellenkleth]

Hmm, our local currency (which was big during the crash of the early eighties) has come back into play again.

What we're seeing here on the ground (and so, of course, no linkies and you may therefore feel free to ignore all of these observations):

Crash fire sales now on substitutable goods, as being aggressively advertsised in the local newspapers. Serious crazy-low prices on basically-useless cheap consumer trinkets brought over in quantity from China by retailers (like Canadian Tire and Zellers) who must have thought they could unload them like they did last year. Really: how many sets of cloth-lined wicker baskets does anyone need or want?

Of note, perhaps: Wal-Mart has not bulked-up on this stuff, and they have scaled-back their print advertising. One suspects that they have on staff, and take seriously, some good economists and forecasters.

Also observed, continued rises in the prices of non-substitutable goods. Basic food [ingredient] costs way up (my guess, now, is up 40% year over year), whereas for the middle-of-the-store prepared food items the prices are staying stable. Demand must be crashing for them.

Housing starts down 26% year-over-year here, quelle surprise that the crash would extend north of the border, neh qua? but it has.... All but one major commercial real-estate development here is either announced as cancelled or now on hold: the only exception is that the Wal-Mart on the Campbell River Rez is being completed although its opening date has been pushed-back three months.

[triadruid.livejournal.com]

I added you yesterday because you seem to have a good grasp on the situation(s) going on, and can translate it to a level that I can (mostly) understand. Came here through gamera_spinning, just wanted to give you a head's up who the 'new guy' was.