Posts filed under “Think Tank”

Income/Spending/Savings Rate

May Personal Income rose 1.4%, well above expectations of a .3% gain and April was revised up by .2% with the influence being “the increased government social benefit payments associated with the” stimulus plan. Disposable income as a result rose 1.6% BUT ex these special factors, disposable income rose just .2% as wages and salary’s fell by .1%. Due to the steroid shot into incomes, the savings rate rose to 6.9% after Personal Spending rose .3%, in line with forecasts. Because headline PCE rose .1%, REAL spending rose .2%, the first real gain since Jan. Bottom line, analyzing the savings rate has become more difficult in light of the one time special government transfer payments and with spending rising more than disposable income this month, the real savings rate likely would have fell a touch.

Category: MacroNotes

Bernanke Dodges Bullet; Markets Celebrate

Good Evening: As Thursday dawned, market participants were a little on edge. Yesterday’s FOMC statement was found a bit wanting by most investors, leaving them concerned about not only the Fed’s exit strategy from Quantitative Easing but also Chairman Bernanke’s exit strategy for a successful escape during today’s Congressional hearings on the BAC-MER deal. Those…Read More

Category: Markets, Think Tank

7 yr note auction

The $27b 7 yr note auction and last of the week was solid (as were the prior two this week) as the yield was about 1-2 bps below where the when issued was priced right before and the bid to cover of 2.82 was the highest since they were reintroduced in Feb and above the…Read More

Category: MacroNotes

Commercial paper outstanding

Commercial paper outstanding for the week fell by a sharp $47.5b and totals $1.15 trillion, the lowest since at least Nov ’00 that data is out and down from the record high of $2.22 trillion in July ’07. The decline was led by a $44.3b decline in nonfinancial CP to $108.7b, a 29% drop from…Read More

Category: MacroNotes

Bernanke testimony

Ahead of Bernanke’s 10am testimony on the Bofa-Merrill deal where he and Paulson are being accused of strong arming Ken Lewis to follow thru with the deal on its original terms, it hit me the striking similarity in looks that Bernanke has with Frank Pentangeli (without the beard), the character in Godfather II that went…Read More

Category: MacroNotes

Goldman Sachs: The Great American Bubble Machine

Try this PDF: Goldman Sachs: The Great American Bubble Machine ~~~

Category: Bailouts, Psychology, Think Tank

New Home Sales

May New Home Sales, a measure of contract signings of new homes, totaled 342k annualized, 18k less than expected and down a touch from 344k in April. Mortgage rates remained below 5% for most of the month so this data doesn’t reflect the recent rise but it does take into account the government’s $8,000 home…Read More

Category: MacroNotes


The FOMC began with talk on the economy that was very similar to the April one. “The pace of economic contraction is slowing.” It followed with the caveats of constrained household spending due to job losses, lower housing wealth and tight credit and also referenced businesses cutting back on fixed investment and staffing and they…Read More

Category: MacroNotes

King Report: Second Stimulus?

> Yesterday President Obama said a second stimulus package is not needed, for now. Do you think Ben Bernanke and the Fed will refute the president’s claim in its communiqué today? Not bloody likely! Obama’s ‘not yet’ on a second stimulus package is intended to assuage China and Japan’s concern over the US budget and…Read More

Category: Think Tank

Durable Goods

New orders for May Durable Goods unexpectedly rose both headline and ex transports. Headline rose 1.8% vs a forecasted drop of .9% while ex transports rose 1.1% vs an expected fall of .5%. The prior month was revised lower by a touch. Non defense capital goods ex aircraft, the pure cap ex component, rose a…Read More

Category: MacroNotes