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Essential Weekend Reading - September 26-27, 2009

by Chris Martenson
Saturday, September 26, 2009, 1:38 PM

Here's your essential weekend reading.  As usual, I collected a large number of articles all week and these are the ones the stuck with me.

» Read more

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Housing Market Update

by Chris Martenson
Friday, September 25, 2009, 1:44 PM

The prior Martenson report on housing covered inventory (supply) and prices.  Lots of news has recently come out that I want to add to the story.  The breaking news in this area is coming a furious pace these days.

This first is an estimate of shadow inventory, and it's something of a shocker.  Where I had suspected that inventory was being understated "by a few million," I did not think that it was as high as 7 million. » Read more

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Jobless Claims Fall, Mass Layoffs Rise - Which Is Right?

by Chris Martenson
Thursday, September 24, 2009, 12:15 PM

One of the harder things to do these days is to try and make sense of all the contradictory statements and data.

Earlier this week, we found out that mass layoff actions were up sharply in August.  But today we found out that unemployment claims have been trending down for months.  Which is right?  Can they both be right?

First, the mass layoff data: » Read more

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Decoding the Fed

by Chris Martenson
Thursday, September 24, 2009, 8:06 AM

The Federal Reserve policy statement yesterday was a masterful blend of contradictory words and ideas.


Nonetheless, the markets reacted with great volatility to these words, as though there was some useful information within them.   You can read the entire statement for yourself here at this link. 


To save you the trouble, what I've done is chopped the whole statement up into smaller sections and translated them (with tongue in cheek, but only slightly): » Read more

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The Liquidity Flood

by Chris Martenson
Tuesday, September 22, 2009, 8:56 PM

I don't know what else to say at this point, other than that everyone had better be ready for massive inflation..

For the record, I do not ascribe to the simplistic views of "either/or" when it comes to the great inflation vs. deflation debate.  When I am asked about which outcome I favor, I say "yes."

What I mean by this somewhat flippant comment is that I can easily envision some assets declining in price (worthless CDOs anyone?  McMansions?) even as I see other things rising dramatically in price.

I've alluded to this before, and now the evidence for a liquidity flood is presented below: » Read more

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Housing and Wealth - Part I (Supply and Prices)

by Chris Martenson
Tuesday, September 22, 2009, 11:07 AM
Tuesday, September 22, 2009

Executive Summary

Tracking the housing market helps us see where the economy is headed.  Two categories of data that are useful to focus on are house prices and housing supply.

House Prices

Measuring the value of housing is critical, because the amount of foreclosures and the economic fallout from them are both tightly linked to the difference between the current value of a house and the mortgage held on it.

Housing Supply

To appreciate housing supply, there are three things we need to track:

  • Total number of existing homes for sale (expressed in either a raw number or in “month's supply,” which takes the raw number and divides it by the current sales pace)
  • Total number of new homes for sale (expressed the same as above)
  • Amount of “shadow inventory,” which are homes that are on the books of the banks but have not been released into the market for sale

This is Part I of a two-part report.

» Read more
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Treasury Purchases: Foreigners Can't Get Enough

by Chris Martenson
Monday, September 21, 2009, 8:03 PM

Aside from a critically important family meeting I attended this weekend, I spent the rest of the time this weekend, and through today, working on the latest Martenson Report, which should be out by tomorrow morning at the latest.  The report will be on housing and where we stand with respect to prices, inventory, liquidity, and demand. In terms of where we are headed economically, housing ranks as one of the most vital issues of the day. » Read more

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Insider Essential Weekend Reading - September 19-20, 2009

by Chris Martenson
Friday, September 18, 2009, 3:17 PM

Here's your essential reading for the weekend.  I will be off at a family meeting in VT this weekend, so my ability to check in and post at the site will be limited.

» Read more

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Flow of Funds Analysis - Big Declines in Credit Market Debt (Except for Government)

by Chris Martenson
Thursday, September 17, 2009, 1:52 PM

The Flow of Funds report, covering the second quarter of 2009 (through June), was released today by the Federal Reserve.  It revealed yet another retreat in total credit, despite the heroic levels of state and federal government borrowing.

One of the better windows available into the macro credit and borrowing universe is a quarterly report put out by the Federal Reserve called the "Flow of Funds" report.   While it is a bit dated already (the report covers through the end of June), it is a great snapshot of the big trends and can tell us much about the general direction in which we are headed.  This report was released today (9/17/2009) at 12:00 p.m.

Here are a few of the fascinating findings… » Read more

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Another Huge Miss - Money Floods Out of the US in July

by Chris Martenson
Wednesday, September 16, 2009, 10:39 AM

The Treasury International Capital data for July came out this morning, and it once again revealed a far larger outflow of money than anyone expected.

In fact, for a country borrowing as much as the US, anything less than a few hundred billion to the positive every month is a really big problem.  If you've been wondering why the dollar has been going down, here's part of your answer….money is flooding out of the US. » Read more