- Financial Sense News hour 3, June 6 (Repost, Audio)
- Predictions of $250 a barrel on fears for oil reserves, hopes of economic recovery and hedging against weak dollar
- The Economic Recovery Decoy: Bank Refuge and Auto and Home Sales Plummet. Two Largest Purchases for Americans still Treading Water. Number of Renters Increases by 748,000 in one Quarter.
- A housing recovery? Not even close.
- An urgent Message from Jim Sinclair. Re: GOLD and SILVER
- Keep in mind that whenever we’re talking “bonds” or “Treasuries,” what we’re really talking about, of course, is DEBT
- California [World’s 8th Largest Economy] Controller Releases May Cash Flow Figures…“Fifty days from a meltdown of State government.”
- Z.1 Flow of Funds: Total Debt Still Growing
- Foreclosures Up 18% (Chart)
- I/O Mortgages Hit Commercial Real Estate
- * * * * ABBY NORMAL (Repost)
- ****6:04 Minsky, Bubbles, 5 Steps of: 1.) A Displacing Event 2.) Credit Creation/Fuel/Expanding Money Supply 3.) Captivates Investors Euphoric State 4.) Critical Stage, Financial Distress 5.) Revulsion
- 9:00 copper and oil, India and China
- 11:30 Insolvency, 100 trillion
- 15:00 60% tax or 10% per year inflation needed to balance budget
- 23:00 School kids laugh at Geithner
- 30:00 (Can’t read notes)
- 31:00 USD falling
- 33:00 Geithner Image
- 34:00 Kid for an auto Czar
- 37:00 Unfunded liabilities
- 41:00 Oil
- 48:00 Electricity
- 52:00 Demand
- 56:00 A or B, EV’s or War for oil
- 1:01 Reverse Globalization
- Part 2 of 3rd Hour: 2:00 How Ben How?
- 4:30 Inflation
- 6:30 (Can’t read notes)
- 14:00 Second wave up
This was a good listen, I’d make it a point to catch it.
The pundits on CNBC who appear every morning proclaim that things are returning to normal. It amazes me that such supposedly intelligent people have no idea what normal means. Since 80% of the people interviewed on CNBC manage other people’s money, I’m guessing they are just trying to stay in business by lying to the average investor. If they were honest, they would say they have no idea what the future holds. If they were outspokenly honest, they would say that a Frankenstein’s Monster is loose in the countryside and will wreak havoc on the American economy for years.
Despite the 2008 rise in coal consumption, the BP data showed growth in the use of the fuel continued to decline compared with 2007 when it rose 5% and five years ago when it went up by 8%.
But the coal figures will alarm environmentalists and increase the calls for companies and governments to speed up trials on "clean coal" technology and the use of carbon capture and storage.
China has promised to increase its use of renewables: Zhang Xiaoqiang, vice-chairman of the China’s national development and reform commission, says the country may produce as much as 20% of its energy from wind and solar by 2020.
When I hear about the banks and Wall Street returning TARP money to the government I can’t help to think of a successful Trojan Horse hitting our economy from within. The initial rush to back an unprecedented bailout for the sake of the economy actually turned out to be a strategic looting of the American taxpayer. The exercise of AIG being used as a conduit to funnel billions of dollars to firms such as Goldman Sachs was merely a diversion on the breaking backs of the American people. And to what end?
Do we measure success by having 26,000,000 unemployed and underemployed Americans who are now destined to take jobs making half of what they once did?
When we hear the deep pain of our average citizens, they are told with a round about manner that there is no more money. We are broke. This is true. Yet over and over banks and Wall Street get hand out after hand out and policy that is conducive to their well being. Not from a current savings account since there is none to be found but from future generations and the sustainability of our country. The public was mislead to believe that Wall Street survival in its current form was the only way to assure the prosperity of America. This has turned out to be a ruse of historical proportions. If we even think about the two biggest purchases Americans make, that of the automobile and home they are no where near their historical peaks:
Zillow.com said that overall, the number of borrowers who are underwater climbed to 20.4 million at the end of the first quarter from 16.3 million at the end of the fourth quarter. The latest figure represents 21.9% of all homeowners, according to Zillow, up from 17.6% in the fourth quarter and 14.3% in the third quarter. There are 75 million homes in the United States. One third of homeowners have no mortgage, so that means that 41% of all homeowners with a mortgage are underwater. With prices destined for another 10% to 20% drop, the number of underwater borrowers will reach 25 million.
You know that information that comes to me has been reliable. You also know that the entire purpose of all of working here at JSMineset has been to get you through this safely. You also know that if we had not been here hundreds of thousands of people now holding gold would not be.
So please pay attention to the following.
This week alone the Fed had to convince “investors” to buy up $150 billion worth of OUR debt! That has now created a Historic CRASH of the bond market with TLT, the 20 year bond fund, losing almost 30% of its value. The ten year rose to 4% and that will take 30 year mortgages well over 6%. While that may not sound like much compared to historic rates, and it’s not, because we are so saturated with debt and have financed a huge portion of our debt with short term financing, resetting to higher rates will be very painful indeed. The more debt in the system, the more painful rising rates will be.
Today at 1:00 Eastern the 30 year bond auction will take place. Yesterday’s 10 year auction didn’t go so well. So, while the greenshoot crowd is pointing out what amounts to nothing I can see, we have crashing bond markets which are a HUGE, GIGANTIC WEED in our economic garden! Here’s a daily chart of the 10 year futures on the left, and long bond on the right since Christmas:
"Without immediate solutions from the Governor and Legislature, we are less than 50 days away from a meltdown of State government. This presents a terrible threat to California’s economy and to the State’s delivery of basic public services,” said Chiang. “A truly balanced budget is the only responsible way out of the worst cash crisis since the Great depression.”
Personal income taxes were $475 million below (-23.0%) estimates in the May Revision. Corporate taxes were down $84.4 million (-25.8%), and sales taxes fell by $109 million (-3.3%).
The Fed published the Z.1 Flow of Funds at noon.
The key takeaway: Total debt continues to grow, albeit more slowly.
Since Q3 ‘08 households have cut their debt (slightly), but the federal government is borrowing so rapidly, overall debt continues to expand.
“The worst is yet to come. Typically there’s a lag between when the economy softens and when the defaults actually occur.”
-Steven Kandarian, MetLife Inc. Chief Investment Officer
Ahhhhh, its nice to see that sophisticated professionals make the same mistakes that Mom & Pop did during the credit bubble: Interest-Only Mortgages: