Monday, June 01, 2009

Mish's Global Economic Trend Analysis - "Mortgage Meltdown, More Pain To Come" (5-31-09)

"Does it matter much if home prices are bottoming across vast sections of the farm belt with low density houses if the big cities are still declining rapidly? Certainly we are closer to a bottom than two years ago but I am betting the bottom is still years away although the rate of decline is slowing."

USA Today - "Leap in U.S. debt hits taxpayers with 12% more red ink" (5-31-09)

"
Taxpayers are on the hook for an extra $55,000 a household to cover rising federal commitments made just in the past year for retirement benefits, the national debt and other government promises, a USA TODAY analysis shows. The 12% rise in red ink in 2008 stems from an explosion of federal borrowing during the recession, plus an aging population driving up the costs of Medicare and Social Security."

The Barricade - "Why We Are Not In For A 'Recovery'" (5-31-09)

"Commercial real estate is headed for a depression just as prime loans and jumbo loans blow up. Meanwhile, oil is being bid up by speculators (mostly TARP-receiving financial institutions) and the electronic economy is ignoring fundamentals. This all bodes for a summer crash. Expect higher unemployment as small and large businesses go bankrupt–further weakening spending and consumption. Consumer confidence may be reported as high, but their actual spending will not be. Pressure will increase on the Dollar, as the Fed buys debt so the Treasury can sell debt. Alas, foreclosure deserts will continue to spread across much of the Sun Belt suburbs, as business gradually grinds to an even slower pace than what we already see. The Rust-Belt slouches towards Thunderdome."

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