a bit more data-driven
Sep. 26th, 2009 05:39 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
solarbirdSo I've been catching up a bit on data. Please enjoy this information on this pleasant late summer weekend. (Yes, it's officially fall. That it was sunny and warm today in Cascadia is no excuse to be lazy and rely on the calendar! This is clearly more summer.)
The "Up Up UP!" drumbeat seems to be catching on in consumer perceptions about the economy, with consumer sentiment about the economy rising sharply in September. However, that was mostly in their overall opinion, stating that the economy overall is improving, but their personal situation has degraded, with "record number of consumers report[ing] income declines in September." So there's a perception that things are improving for other people, but not for themselves.
Durable Goods orders fell unexpectedly in August, 2.4%, the biggest drop since January. More interestingly, extract defence spending, and new orders fell 7.1%, a substantial move down. Excess capacity remains very high. New home sales also fell, also unexpectedly, against unrevised numbers (apples to apples). (I mention unrevised vs. unrevised as vs. revised data from last month, the numbers rose a tiny amount, tho' significantly less than expected. That will probably change when these numbers are also revised.) Existing home sales also fell, also unexpectedly.
While on real estate, readers may want to notice that banks are requiring borrowers who execute a negotiated short-sell to continue paying the mortgage on the shortfall. That's always been possible, but is reported as historically atypical - but with the problems in bank balance sheets being so extensive, there's a lot more incentive to go after every nickel.
Really, all kinds of loans are degrading. "Problem" loans are up 174% year-to-year. "[C]riticized assets rated 'special mention', 'substandard', 'doubtful' and 'loss', touched $642 billion," which is big goddamn money for anyone, even governments. Nonperforming (amalgam) is up to US$172B. Total confirmed losses are triple their previous record high, at $53B so far in 2009.
In the midst of this, the Fed is shifting money around. The mortgage-related bailout - guarantees, backings, promises, actual money - is "down" to around $11.6T in total, mainly through cutting out a couple of the older, nonfunctional programmes, like the TAF. Various defenders of these programmes say these numbers aren't real, these are all secured loans, backed against assets. Yeah, assets like those described in the previous paragraph. Let's hope that works out!
There is one "buy" recommendation of note in banking, however; Meredith Whitney upgrades Goldman Sachs to buy. Evil pays well!
Still, despite all this, the stock market has mounted a sustained rally. Tyler Durden at Zero Hedge finds certain ongoing Congressional testimony to be particularly fascinating on this topic, with Rep. Alan Grayson (D-FL) suspecting market manipulation by the Federal Reserve through primary dealers. Robert Reich asks for RGE monitor why this is happening, and notes, well, it's massive government intervention, duh. However:
So, let's look at shipping. Shipping indicates a lot about future economic activity, in a "globalised" world. The Baltic Dry Index has been trending consistently down, indicating that even when ships being intentionally laid up, bulk materials shipping continues to decline. The recovery caused by China's buying binge was substantial, but has been largely erased. Japanese export numbers - meaning, production goods - fell dramatically in August, particularly in automobiles, which fell by half.
Christmas selling is starting early this year, by the way. Yes, earlier. As in, now. Back-to-school was a non-event, sales are still terrible, and if import/export is any indicator, won't be improving soon. Oh, did I mention anywhere that the US dollar index fell below 76 earlier this week? It's recovered a little, but the US dollar looks like it may be becoming the carry-trade currency of choice. That wasn't real fun for Japan in the 90s, what with the absorption of available liquidity by overseas investors reducing credit availability at home. Various countries - Germany, Switzerland, Venezuela, others - have been announcing dollar-denominated debt issuances. They're betting on a further fall in the US dollar. That's been working out pretty well for them so far.
Internationally, Spain has entered semi-official depression, with an expected 11% loss in GDP. There's not a formal definition for "depression" in the way that there is "recession;" I tend to term a "deflationary recession" a "depression" and an "inflationary recession" a regular "recession," but the more common informal definition is a 10% drop in GDP.
Finally - last post, you got some unsupported bull pr0n, so here's some corresponding bear pr0n: permabear Marc Faber says this whole thing has been just the precursor to a larger collapse. He calls the next wave the "total breakdown." Welcome to October. OooooooooooOOOOoooooOOoo.
The "Up Up UP!" drumbeat seems to be catching on in consumer perceptions about the economy, with consumer sentiment about the economy rising sharply in September. However, that was mostly in their overall opinion, stating that the economy overall is improving, but their personal situation has degraded, with "record number of consumers report[ing] income declines in September." So there's a perception that things are improving for other people, but not for themselves.
Durable Goods orders fell unexpectedly in August, 2.4%, the biggest drop since January. More interestingly, extract defence spending, and new orders fell 7.1%, a substantial move down. Excess capacity remains very high. New home sales also fell, also unexpectedly, against unrevised numbers (apples to apples). (I mention unrevised vs. unrevised as vs. revised data from last month, the numbers rose a tiny amount, tho' significantly less than expected. That will probably change when these numbers are also revised.) Existing home sales also fell, also unexpectedly.
While on real estate, readers may want to notice that banks are requiring borrowers who execute a negotiated short-sell to continue paying the mortgage on the shortfall. That's always been possible, but is reported as historically atypical - but with the problems in bank balance sheets being so extensive, there's a lot more incentive to go after every nickel.
Really, all kinds of loans are degrading. "Problem" loans are up 174% year-to-year. "[C]riticized assets rated 'special mention', 'substandard', 'doubtful' and 'loss', touched $642 billion," which is big goddamn money for anyone, even governments. Nonperforming (amalgam) is up to US$172B. Total confirmed losses are triple their previous record high, at $53B so far in 2009.
In the midst of this, the Fed is shifting money around. The mortgage-related bailout - guarantees, backings, promises, actual money - is "down" to around $11.6T in total, mainly through cutting out a couple of the older, nonfunctional programmes, like the TAF. Various defenders of these programmes say these numbers aren't real, these are all secured loans, backed against assets. Yeah, assets like those described in the previous paragraph. Let's hope that works out!
There is one "buy" recommendation of note in banking, however; Meredith Whitney upgrades Goldman Sachs to buy. Evil pays well!
Still, despite all this, the stock market has mounted a sustained rally. Tyler Durden at Zero Hedge finds certain ongoing Congressional testimony to be particularly fascinating on this topic, with Rep. Alan Grayson (D-FL) suspecting market manipulation by the Federal Reserve through primary dealers. Robert Reich asks for RGE monitor why this is happening, and notes, well, it's massive government intervention, duh. However:
The problem is, our newly expanded government isn't doing much for average working Americans who continue to lose their jobs and whose belts continue to tighten, and who are getting almost nothing out of the rising Dow because they own few if any shares of stock. Despite the happy Dow and notwithstanding the upbeat corporate earnings, most corporations are still shedding workers and slashing payrolls. And the big banks still aren't lending to Main Street.NYSE chief Duncan Niederauer has a similarly difficult time seeing a real economic recovery in all this, noting in particular, "It's difficult for anyone but those with pristine credit ratings to get reasonably priced capital... Money's not flowing into areas of the economy where we want to see it invested." Mish Shedlock has some commentary on the resulting debt load, as you'd expect. Dr. Roubini calls it time to be looking desperately for an exit strategy for the policies that he feels have prevented a Depression, but must be unwound to prevent disastrous consequences.
Trickle-down economics didn't work when the supply-siders were in charge. And it's not working now, at a time when -- despite all their cries of "socialism" -- big business and Wall Street are more politically potent than ever.
So, let's look at shipping. Shipping indicates a lot about future economic activity, in a "globalised" world. The Baltic Dry Index has been trending consistently down, indicating that even when ships being intentionally laid up, bulk materials shipping continues to decline. The recovery caused by China's buying binge was substantial, but has been largely erased. Japanese export numbers - meaning, production goods - fell dramatically in August, particularly in automobiles, which fell by half.
Christmas selling is starting early this year, by the way. Yes, earlier. As in, now. Back-to-school was a non-event, sales are still terrible, and if import/export is any indicator, won't be improving soon. Oh, did I mention anywhere that the US dollar index fell below 76 earlier this week? It's recovered a little, but the US dollar looks like it may be becoming the carry-trade currency of choice. That wasn't real fun for Japan in the 90s, what with the absorption of available liquidity by overseas investors reducing credit availability at home. Various countries - Germany, Switzerland, Venezuela, others - have been announcing dollar-denominated debt issuances. They're betting on a further fall in the US dollar. That's been working out pretty well for them so far.
Internationally, Spain has entered semi-official depression, with an expected 11% loss in GDP. There's not a formal definition for "depression" in the way that there is "recession;" I tend to term a "deflationary recession" a "depression" and an "inflationary recession" a regular "recession," but the more common informal definition is a 10% drop in GDP.
Finally - last post, you got some unsupported bull pr0n, so here's some corresponding bear pr0n: permabear Marc Faber says this whole thing has been just the precursor to a larger collapse. He calls the next wave the "total breakdown." Welcome to October. OooooooooooOOOOoooooOOoo.
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no subject
Date: 2009-09-27 05:44 pm (UTC)In addition, the banking/investment industry have been spending over 1 million per day lobbying Congress to pass weak reforms that will allow them to do it all over again. Some are even issuing CDOs.
I don't expect things to get much better for a very long time.