More "green shootin' fun": 3 facts not mentioned by MSM

[c1ue]

1) Prime delinquencies in mortgages now 6.4% (these are 'good to great credit') vs. subprime 25.4% delinquencies.

Overall delinquency rate now 9.24% for ALL mortgages

http://www.marketwatch.com/story/tro...wsj-2009-09-04

2) Manpower survey of employers show lowest hiring plans since 1982

http://www.marketwatch.com/story/hir...wer-2009-09-08

A net -3% of employers said they'll hire in the fourth quarter, down from -2% in the third quarter, on a seasonally adjusted basis, according to the Milwaukee-based firm's survey of more than 28,000 employers. Before this year, the survey's previous low point was a net 1% hiring outlook for the third quarter of 1982.

3) Workers' hours still very near record low as of August 2009

http://www.bloomberg.com/apps/news?p...d=aN8Zh1qEkeSw

The average workweek held at 33.1 hours, six minutes from the 33 hours in June that was the lowest since records began in 1964, the Labor Department said yesterday. The report also showed that while payrolls fell by the least since August 2008, the unemployment rate rose to a 26-year high of 9.7

[D-Mack]

Re: More "green shootin' fun": 3 facts not mentioned by MSM

even the bankers see it

Meanwhile, bankers are reporting rising delinquency rates across all categories of loans.

http://online.wsj.com/article/SB125251848881396401.html

[santafe2]

Re: More "green shootin' fun": 3 facts not mentioned by MSM

Overall delinquency rate now 9.24% for ALL mortgages

I don't see how this resolves well over the 6 month slow season in real estate. I would imagine that many who are behind are also under water. Whatever hope the summer uptick brought will not be continued this winter as job loses continue to climb and real estate sales slow.

[c1ue]

Re: More "green shootin' fun": 3 facts not mentioned by MSM

I don't see how this resolves well over the 6 month slow season in real estate. I would imagine that many who are behind are also under water. Whatever hope the summer uptick brought will not be continued this winter as job loses continue to climb and real estate sales slow.

Yet another reason why the 'temporary' Fed mortgage buying will be extended and enlarged, and America's creditors socked in the nose again.

Since clearly the Fed/Treasury will continue its water torture of existing creditors, the likelihood of BoP crisis a la iTulip grows...

p.s. did you get the yaozhuang reference? :rolleyes:

[ThePythonicCow]

Re: More "green shootin' fun": 3 facts not mentioned by MSM

Since clearly the Fed/Treasury will continue its water torture of existing creditors, the likelihood of BoP crisis a la iTulip grows...

I thought Balance of Payment (BOP) crises occurred when a nation could not export enough stuff to obtain enough dollars to pay its foreign debt.

If there's one thing the United States has, it is an unlimited supply of dollars. Moreover it has more or less zero foreign debt.

When there is a water shortage in California, it does not mean that there is a water shortage on this planet. It means there is "too much" (salty) water in the Pacific Ocean and too little (fresh) water in the snow pack or lakes of the Sierra Nevada mountains.

The United States is the Pacific Ocean of the world's reserve currency.

[touchring]

Re: More "green shootin' fun": 3 facts not mentioned by MSM

Perhaps you are looking at the wrong place for shoots.

http://www.nytimes.com/2009/08/28/bu...bal/28icc.html
http://www.nuwireinvestor.com/articl...ace-53562.aspx

1) Prime delinquencies in mortgages now 6.4% (these are 'good to great credit') vs. subprime 25.4% delinquencies.

Overall delinquency rate now 9.24% for ALL mortgages

http://www.marketwatch.com/story/tro...wsj-2009-09-04

2) Manpower survey of employers show lowest hiring plans since 1982

http://www.marketwatch.com/story/hir...wer-2009-09-08



3) Workers' hours still very near record low as of August 2009

http://www.bloomberg.com/apps/news?p...d=aN8Zh1qEkeSw

[c1ue]

Re: More "green shootin' fun": 3 facts not mentioned by MSM

I thought Balance of Payment (BOP) crises occurred when a nation could not export enough stuff to obtain enough dollars to pay its foreign debt.

If there's one thing the United States has, it is an unlimited supply of dollars. Moreover it has more or less zero foreign debt.

I think you have a slight misapprehension:

The United States has relatively little debt in foreign currencies, but it has massive debts in its own currency to foreigners.

So if your intention is to emphasis the differences of other balance of payments crises, then the letter of the distinction is correct.

But the spirit of the distinction is not: while the US might not owe lots of foreign money to foreign creditors, the US pays plenty of money every day to foreigners in return for material goods as well as carry payments on existing debt. Or in other words, in continuing to borrow more.

Why does this matter? Because if the US were magically to Suddenly Stop, the effects of the existing debt and reliance on new foreign lending would immediately become apparent besides the act of immediately balancing debts and income itself being a Sudden Stop.

Even the illusion that owing debt in your own currency (a fiat reserve one) is somehow safer is untrue: the float which the rest of the world has conducted much of its outside-US trade has subsidized US standards of living via a stronger than normal purchasing power.

Were the BoP to not occur, even the reversal of this reserve currency/trade float/purchasing power subsidy would itself have severe negative effects on the US.

A glance at the July 2009 trade numbers give a hint:

July 2009
Trade Numbers

Balance: -$32.0 Billion
Exports: $127.6 Billion
Imports: $159.6 Billion

Should the US dollar's role as reserve currency be significantly supplanted, the fall in the dollar itself will cause great dislocation: an iTulip USDX of 60 means the existing negative trade balance would shift a minimum of 1/3 up: instead of a $32B deficit with $127.6B outgoing and $159.6B incoming, all things being equal the result would be a $43B deficit with $170B outgoing and $213B incoming.

But of course in reality what is much more likely to happen is that imports fall to match a rising volume but similar dollar value export level.

In turn that means $127.6B in exports (25% increase in unit volume) matched by a 44% fall in import unit volume.

Do you think a 44% fall in unit volume of imports would have an effect on this nation? Even if it were excluding oil?

[snakela]

Re: More "green shootin' fun": 3 facts not mentioned by MSM

I don't know about you guys but I can't take the cognitive dissonance anymore.

These problems are plastered all over the internet, its not like they are secret just because they aren't blared out over CNBC but the market keeps marching higher. About everything I saved by staying out of the market since early 2008 I've lost a little at a time trying to short these various pieces of sh*t (Yes MM I know, but I didn't know about iTulip then).

There's got to be a better explanation. How about this: The present value of a cashflow in perpetuity is A/r right? Well, I guess we expect r to be zero for some long time or until the dollar is only good for toilett paper. Either way P/E ratio expansion baby!

[flintlock]

Re: More "green shootin' fun": 3 facts not mentioned by MSM

Is there a fund yet to go long P/E ratios?

[ThePythonicCow]

Re: More "green shootin' fun": 3 facts not mentioned by MSM

Even the illusion that owing debt in your own currency (a fiat reserve one) is somehow safer is untrue:

Oh yeh -- it still blows up real good. But it's still a blow up with U.S. characteristics. I may look back on this after it is all over and recognize that your description, or EJ's descriptions, or someone else's descriptions, nailed it dang near perfectly. But so far my understanding of just how this blows up amounts to little better than hand waving in a general direction.

[dummass]

Re: More "green shootin' fun": 3 facts not mentioned by MSM

I thought Balance of Payment (BOP) crises occurred when a nation could not export enough stuff to obtain enough dollars to pay its foreign debt.

If there's one thing the United States has, it is an unlimited supply of dollars. Moreover it has more or less zero foreign debt.

When there is a water shortage in California, it does not mean that there is a water shortage on this planet. It means there is "too much" (salty) water in the Pacific Ocean and too little (fresh) water in the snow pack or lakes of the Sierra Nevada mountains.

The United States is the Pacific Ocean of the world's reserve currency.

It's my understanding that a BOP crises will happen if the US is unable to continue borrowing the funds needed to fund it's massive deficit. This would result in the Federal Reserve printing every dollar required to fund the US Treasury's obligations. At which point, a full scale repatriation of dollars would cause hyperinflation of the US dollar.

Just something I heard from some guy ;)

(P.S. the US currently exports debt to balance its payments)

[ThePythonicCow]

Re: More "green shootin' fun": 3 facts not mentioned by MSM

It's my understanding that a BOP crises will happen if the US is unable to continue borrowing the funds needed to fund it's massive deficit. This would result in the Federal Reserve printing every dollar required to fund the US Treasury's obligations. At which point, a full scale repatriation of dollars would cause hyperinflation of the US dollar.

I think you're right. I seem to have had to narrow a definition of a BoP crisis, referring only to other countries who couldn't get enough dollars to meet debt payments. The U.S. has its own special form of a BoP, as you describe. The U.S. problem will be too many dollars, not too few.

Just something I heard from some guy ;)

You should be careful what you read on those internets, you know .

[santafe2]

Re: More "green shootin' fun": 3 facts not mentioned by MSM

p.s. did you get the yaozhuang reference? :rolleyes:

是，谢谢...I was still laughing when I read the above.

Here's a c1ue: Plug the characters into babelfish, simple Chinese.