I’m mostly out of pocket today (holidays and all that), but a quick look at the papers reveals that the US is still on target for a decaying economy and eventual hard landing:

Slowing Is Seen in Housing Prices in Hot Markets
http://www.nytimes.com/2005/10/04/realestate/04reals.html
sigh . . . old news

Bankruptcy Filings Soar As Tougher Law Nears   http://online.wsj.com/article/SB112839161016359261.html
This one is going to be nasty

Big S.U.V.’s Lag in Sales, Hindered by Gas Cost  http://www.nytimes.com/2005/10/04/automobiles/04auto.html

In September, industrywide sales of large S.U.V.’s were down 43 percent from a year earlier.  
(See also: Sales of SUVs Fall Sharply
http://online.wsj.com/article/SB112810411178056944.html

Oil Producers Gain Global Clout From Big Windfall http://online.wsj.com/article/SB112838919128959188.html
There’s a security issue, here, as well as an economic one.

Home Builders’ Stock Sales: Diversifying or Bailing Out?    http://www.nytimes.com/2005/10/04/business/04builders.html

A friend observes: Don’t you know why the bigwigs are blowing out in size? Simple: Because they think the stock is gonna’ trade higher.
(Ha!)

I have a few words here: 
•  If housing slumps, how safe are you?   
http://www.msnbc.msn.com/id/9582621/
Housing now infects everything 

Lastly, PIMco’s Bill Gross opines that "If real housing prices decline in the U.S. in 2006 or 2007, a recession is nearly inevitable."
http://www.pimco.com/LeftNav/Late+Breaking+Commentary/IO/2005/IO+October+2005.htm

I am all too well aware of my own biases and selective perception; As of now, this remains a minority viewpoint. By the time it becomes the dominant meme, I will (hopefully) be looking to go long . . .

 

Have an informed, happy and healthy New Year!

Category: Economy

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

5 Responses to “Some Headlines of Interest”

  1. Blackwood says:

    Typo, or Freudian Slip commentary on the auction price mentality fueling the housing price mania?

    “If the housing bubble bursts, you may be more exposed than you think, especially if you won financial-services and consumer stocks.”
    http://www.msnbc.msn.com/id/9582621/

  2. sek says:

    How about emerging and European markets? Do you suppose their correlation with US markets will decrase, or will a hard landing in the US take everything down everywhere?

  3. fatbear says:

    And A Happy, Healthy & Prosperous New Year to you too!

  4. gary lammert says:

    1932-2006 – The Second 74 Year SubCycle of the US
    Second Grand Fractal? A Replay of 1858-1932?

    As the United States enters the possible turbulent time frame
    of its second major decay fractal since 1858, its government,
    corporations, and people are not in good fiscal shape. The first major
    decay cycle ended in 1932 for a total of 74 years. By recent fractal
    analysis the second cycle may likewise end in an additional 74 years
    or in 2006. A nearly unimaginable asset and economic deflationary
    collapse is possible.

    The imbalances in the world’s leading GDP economy are profound. Since
    1982 America’s GDP has been stimulated by a general trend of falling
    long term interest rates -set at the high bar by Mr. Volcker. Before
    1982, the US GDP was stimulated by post World War II European
    rebuilding, real smoke stack and factory mass production, interstate
    highway building, social spending, Vietnam war spending, and cold war
    military spending. In the last few years massive tax rebates and ultra
    low interest rates combined with imprudent and unregulated lending
    practices have created historical personal debenture spending
    resulting in housing overvaluation and secondary debt accumulation
    from second mortgages. Unlike the 150 years prior to 1948 where nearly
    half the years were contracting GDP’s, the post 1947-48 years have had
    all positive GDP growth – a historical anomaly. The breaking branch
    today is so much higher than the one perched on in 1929.

    The severity of America’s occult economic illness may be judged by the
    trends in total federal revenues since 1966. Total tax revenues have
    historically doubled every 7-10 years. From the CBO’s historical
    tables, there was doubling in revenues in the following years from
    1966: 1974,1980,1990, and 2000. Since 2000, total revenues have
    actually decreased with a loss of several trillion dollars of
    traditional revenue growth.

    Without the borrowed social security funds from the empty ‘lock box’,
    governmental borrowing would tax even the abilities of the ‘world glut
    of foreign dollar saving recipients.’ Social security tax revenue
    nearly matches personal income tax revenue and has come to represent
    merely an additional tax that offsets the summation of all federal
    expenses. There is no money in the social security trust fund;
    interest earned in the trust fund is an accounting mirage; and the
    fallacy of depicting future solvency based on assets and interest
    earned in that trust fund is likewise, purely an illusion. Solvency
    and future payments to a growing number of retirees will be based on a
    dwindling ratio of predominately US service-type workers with their
    lower wages and increased personal income taxes to maintain needed
    discretionary spending. For linear thinkers a look at the US CBO
    report for the out years is instructive. Where is the projected growth
    in GDP coming from? The maximum economic stimulation has been spent.
    Likewise a look at the past CBO report from 2000 with its forward
    projection of budgetary surpluses in 2001-2010 is instructive on the
    effects that an equity collapse has on projected surpluses.

    The macroeconomy is efficient. Asset deflation does occur and occurs
    in discrete fractal patterns. It is not chaotic. A look at the DJIA
    from 1929 to 1932 is instructive.

    The last major monthly growth fractal pattern for US equities started
    in late 1994. The monthly pattern was:

    14/32-34/28; a low occurred 1.5x later at month 21 for nearly a
    perfect x/2-2.5x/2x/1.5x pattern.

    The 28 months at the top which incorporates the March 2000 peak
    becomes the base for the
    major decay fractal with an expected end at 2.5x or 70 months. The
    equities are currently in their 60th month of this 70 month evolution.
    Since October 1998, this month and week completes a maximal 15/37/37
    monthly fractal growth cycle and a maximal 59/157/157 weekly fractal
    growth cycle.

    The timing for the end of the 70 month devolution matches the end of
    an ideal 1.5x weekly decay fractal for the completed 30/75/60 week
    growth cycle. 1.5x of the 30 month base would be 45 weeks. The
    Wilshire is currently in week 2 of this potential 45 week decay
    fractal.

    If this interpretation is correct, a most interesting and elegant
    defining daily decay pattern is possible dating from the ideal peak of
    of third growth fractal 12/30/24 on 28 July 2005 with a base beginning
    16 trading days earlier on the fateful day of 7/7/2005.

    A defining fractal cycle beginning on 7/7/2005 would add to the
    coincidences and ironies of the two years of devasting hurricanes
    that have ‘punished’ the swing state in the 2000 Presidential election
    and America’s corporately owned oil refineries
    Gary Lammert http://www.economicfractalist.com/

  5. gary lammert says:

    1932-2006 – The Second 74 Year SubCycle of the US
    Second Grand Fractal? A Replay of 1858-1932?

    As the United States enters the possible turbulent time frame
    of its second major decay fractal since 1858, its government,
    corporations, and people are not in good fiscal shape. The first major
    decay cycle ended in 1932 for a total of 74 years. By recent fractal
    analysis the second cycle may likewise end in an additional 74 years
    or in 2006. A nearly unimaginable asset and economic deflationary
    collapse is possible.

    The imbalances in the world’s leading GDP economy are profound. Since
    1982 America’s GDP has been stimulated by a general trend of falling
    long term interest rates -set at the high bar by Mr. Volcker. Before
    1982, the US GDP was stimulated by post World War II European
    rebuilding, real smoke stack and factory mass production, interstate
    highway building, social spending, Vietnam war spending, and cold war
    military spending. In the last few years massive tax rebates and ultra
    low interest rates combined with imprudent and unregulated lending
    practices have created historical personal debenture spending
    resulting in housing overvaluation and secondary debt accumulation
    from second mortgages. Unlike the 150 years prior to 1948 where nearly
    half the years were contracting GDP’s, the post 1947-48 years have had
    all positive GDP growth – a historical anomaly. The breaking branch
    today is so much higher than the one perched on in 1929.

    The severity of America’s occult economic illness may be judged by the
    trends in total federal revenues since 1966. Total tax revenues have
    historically doubled every 7-10 years. From the CBO’s historical
    tables, there was doubling in revenues in the following years from
    1966: 1974,1980,1990, and 2000. Since 2000, total revenues have
    actually decreased with a loss of several trillion dollars of
    traditional revenue growth.

    Without the borrowed social security funds from the empty ‘lock box’,
    governmental borrowing would tax even the abilities of the ‘world glut
    of foreign dollar saving recipients.’ Social security tax revenue
    nearly matches personal income tax revenue and has come to represent
    merely an additional tax that offsets the summation of all federal
    expenses. There is no money in the social security trust fund;
    interest earned in the trust fund is an accounting mirage; and the
    fallacy of depicting future solvency based on assets and interest
    earned in that trust fund is likewise, purely an illusion. Solvency
    and future payments to a growing number of retirees will be based on a
    dwindling ratio of predominately US service-type workers with their
    lower wages and increased personal income taxes to maintain needed
    discretionary spending. For linear thinkers a look at the US CBO
    report for the out years is instructive. Where is the projected growth
    in GDP coming from? The maximum economic stimulation has been spent.
    Likewise a look at the past CBO report from 2000 with its forward
    projection of budgetary surpluses in 2001-2010 is instructive on the
    effects that an equity collapse has on projected surpluses.

    The macroeconomy is efficient. Asset deflation does occur and occurs
    in discrete fractal patterns. It is not chaotic. A look at the DJIA
    from 1929 to 1932 is instructive.

    The last major monthly growth fractal pattern for US equities started
    in late 1994. The monthly pattern was:

    14/32-34/28; a low occurred 1.5x later at month 21 for nearly a
    perfect x/2-2.5x/2x/1.5x pattern.

    The 28 months at the top which incorporates the March 2000 peak
    becomes the base for the
    major decay fractal with an expected end at 2.5x or 70 months. The
    equities are currently in their 60th month of this 70 month evolution.
    Since October 1998, this month and week completes a maximal 15/37/37
    monthly fractal growth cycle and a maximal 59/157/157 weekly fractal
    growth cycle.

    The timing for the end of the 70 month devolution matches the end of
    an ideal 1.5x weekly decay fractal for the completed 30/75/60 week
    growth cycle. 1.5x of the 30 month base would be 45 weeks. The
    Wilshire is currently in week 2 of this potential 45 week decay
    fractal.

    If this interpretation is correct, a most interesting and elegant
    defining daily decay pattern is possible dating from the ideal peak of
    of third growth fractal 12/30/24 on 28 July 2005 with a base beginning
    16 trading days earlier on the fateful day of 7/7/2005.

    A defining fractal cycle beginning on 7/7/2005 would add to the
    coincidences and ironies of the two years of devasting hurricanes
    that have ‘punished’ the swing state in the 2000 Presidential election
    and America’s corporately owned oil refineries
    Gary Lammert http://www.economicfractalist.com/