Rosenberg: Economy Caught in Depression, Not Recession

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Rosenberg comes in around the 6.30 mark.

Courtesy of CNBC: David Rosenberg, Gluskin Sheff & Associates chief economist, discusses his belief that we are in a depression despite the government’s best efforts.

…Rosenberg points out that the “overall economic malaise” has come despite aggressive efforts by the Federal Reserve to stimulate the economy through rate cuts. The central bank itself has scaled back its economic projections, has held steady on its balance sheet, and could be announcing another round of quantitative easing measures at its Jackson Hole summit this week.

“How’s that for a reality check,” Rosenberg said. “It’s not too late, by the way, to shift course if you have stayed long this market.”…

Rosenberg: Economy Caught in Depression, Not Re…, posted with vodpod

August 25, 2010. Tags: , , , , , , , , . Economy, Finance, Foreclosures, Housing, Obama Administration, Politics, Taxes, Unemployment Statistics, Wall St. Comments off.

Is MS’ QE2 refi for all on the way or is Ben blowing sunshine up our axxes?

So is QE2, (the quantitative easing not the ship), on the way or is Ben blowing sunshine and/or smoke up our axxes again?

CaculatedRisk:

From Fed Chairman Ben Bernanke: Challenges for the Economy and State Governments

On the economy:

While the support to economic activity from stimulative fiscal policies and firms’ restocking of their inventories will diminish over time, rising demand from households and businesses should help sustain growth. In particular, in the household sector, growth in real consumer spending seems likely to pick up in coming quarters from its recent modest pace, supported by gains in income and improving credit conditions. In the business sector, investment in equipment and software has been increasing rapidly, in part as a result of the deferral of capital outlays during the downturn and the need of many businesses to replace aging equipment….

UHHH come again? Exsqueeze me? Increased consumer INCOME???? consumer spending?? Have you SEEN the savings rate and the PCE?

Memo to Ben: Wishin’ and hopin’ and thinkin’ and prayin’ is NOT an economic strategy! Give us Growth or tell the SOOPERGENIUSES in the WH to get the hell out of the way!

Ben continues~(…) To be sure, notable restraints on the recovery persist. The housing market has remained weak, with the overhang of vacant or foreclosed houses weighing on home prices and new construction. Similarly, poor economic fundamentals and tight credit are holding back investment in nonresidential structures, such as office buildings, hotels, and shopping malls.

Importantly, the slow recovery in the labor market and the attendant uncertainty about job prospects are weighing on household confidence and spending. After two years of job losses, private payrolls expanded at an average of about 100,000 per month during the first half of this year, an improvement but still a pace insufficient to reduce the unemployment rate materially. In all likelihood, significant time will be required to restore the nearly 8-1/2 million jobs that were lost over 2008 and 2009. Moreover, nearly half of the unemployed have been out of work for longer than six months….

Why  yes!!!, that pesky LACK OF FRAKKIN JOBS is holding us back, just a WEE bit, mighty white of Ben to notice, pardon the pun, my days in the Bronx…

Let’s hope QE2 the MS way is coming (see excerpts and linky below), BTW guess who suggested this 1 pg refi for all??? JOHN MCCAIN IN 2008. yep.

The ONLY WAY IN HELL Ben’s forecast for ‘increased consumer spending and income!!!’ will materialize is if plans are in the works or about to be to launch the MS QE2 plan in which all Americans paying on time get an ‘instant 1 pg refi’ drop in their mortgages to market rates (which, following another buying binge by Fed would be 2.99% let’s say) in CONJUNCTION with cutting principle on the defaultees (this way the foreclosures will stop and the prices will stop dropping in housing) with the new rates for all! the larger group who pay on time wont be so pixxed since they get theirs too…

From the MS PDF-If it were possible to inject a significant amount of stimulus into the US household sector, and this stimulus had zero impact on the budget deficit, did not require an exit strategy, did not distort the markets, and took effect almost immediately, wouldn’t it seem like a slam dunk?
Such an option actually exists in the form of a change to
mortgage refinancing requirements. The Fed and
market forces have pushed mortgage rates to historic
lows, yet many homeowners are unable to take
advantage because they are blocked from refinancing.
This problem could be addressed if the Government
merely recognized its existing guarantee on the principal
value of a large part of the mortgage market – the
mortgages that are backed by Fannie, Freddie and
Ginnie – and acted to streamline the refi process.
There are 37 million mortgages outstanding whose
principal value is backed by the Federal government.
When these homeowners apply for a refinancing, the
application is subject to a standard underwriting process
that involves an LTV test (requiring a property appraisal),
an analysis of the borrower’s FICO score, and income
verification.
We estimate a potential average rate reduction of 125 bp on 50% of the outstanding volume of agency-backed mortgages. In the aggregate, the savings amounts to $46 billion per year. That’s more than the cost of the latest extension of unemployment benefits and more than taxpayers saved under the Make Work Pay tax
credits in the 2009 fiscal stimulus legislation.
The bottom line is that market conditions have created a
potential costless windfall that is not being used. There
is no need for a case-by-case analysis of a borrower’s
credit quality when the principal value of the mortgage is
already backed by the government.

…How Many Borrowers Could Be Impacted?
As seen in Exhibit 3, roughly half of all US households have a
mortgage. Of these 55 million households, 37 million have
mortgages whose principal value is already guaranteed by the
Federal government. Yet, when these homeowners apply for a
refinancing, the application is subject to a standard
underwriting process that involves an LTV test (requiring a
property appraisal), an analysis of the borrower’s FICO score,
and income verification. Obviously, the drop in home prices

during the past few years means that many borrowers will notmeet the LTV requirement – especially since there has been a significant tightening in the appraisal process according to press reports. Indeed, our housing analyst Oliver Chang estimates that more than one-third of all agency-backed mortgages outstanding now have an LTV above 80% (see Exhibit 2). Looking at the principal value of these mortgages, the proportion is even greater (a little above 40% of the total) because an outsized share are located in California, where property values are higher than the national average. There are probably an additional 10% or so of borrowers who don’t qualify for refinancing because of job loss or a low FICO score.
Thus, we believe that perhaps 50% of the outstanding principal value of agency mortgages may not be refi-able at present. As seen in Exhibit 4, this estimate is broadly consistent with actual versus predicted prepay9(ment speeds that currently prevail in the mortgage market. (go read the entire paper and how they propose this be addressed, seems a win/win to me)

but if they do not plan to do this then he is either totally disconnected or full of shxt and lying to us, neither is good…

August 2, 2010. Tags: , , , , , , , , , , , , , , . Economy, Finance, Foreclosures, Housing, Politics, Popular Culture, TARP, Taxes, Unemployment Statistics, Wall St. 2 comments.

Richard Fisher, Dallas Fed President on QE2 and double dip

Vodpod videos no longer available.Fisher makes it quite clear the Fed has done all they can do (and I would argue more than they should have) and that the reason private investment is not picking up the ball is UNCERTAINTY CREATED BY THE POLITICAL PROCESS, ie CONGRESS and OBAMA. If they would just STOP we could all move forward. I think people are STILL deluding themselves into thinking Obama will stop the coming end of the Bush tax cuts. He won’t. They will expire and we will double dip in ’11.

Richard Fisher, Dallas Fed President on QE2 and…, posted with vodpod

July 7, 2010. Tags: , , , , , , , , , , . Economy, Finance, Obama Administration, Politics, TARP, Taxes, Unemployment Statistics, Wall St. Comments off.

Meredith Whitney – Housing double dip is here, Middle Class Squeeze to get worse…

This Congress is killing the middle class.

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CNBC:

…Whitney also said financial regulation reform and policy-making that is not friendly to the middle class will hurt growth.

“The populist incumbents argue that we’ve got to get money to redistribute wealth,” she said. “This squeezes the middle class further down the food chain. The unintended consequences of this are maddening.”..

Meanwhile back in DC our HUD secretary is either deluded or spinning like a top:

…”There is no question that today’s housing market is in significantly better shape than anyone predicted 18 months ago,” he told reporters, adding, “Seventeen months after President Obama took office our housing market is stabilizing.”

To support the claim, the HUD chief released a scorecard on the housing market that showed after 30 straight months of decline, home prices have leveled off and are expected to begin adjusting upward.

It also showed that since April 2009, 2.8 million homeowners have received restructured mortgages through Obama’s loan modification programs, and more than 2.5 million families used the First-Time Homebuyer Tax Credit to purchase a home. The credit was a part of the first stimulus bill Obama signed into law shortly after taking office….

BWAAAAHAA!!! ROTFLMAO!!!!! HAMP and the Tax Credit worked he says!! BWAAAAHAAFRAKKINHAAAA!~!!! ZOMG! Ahh man they really slay me.

more about “Meredith Whitney – Housing double dip…“, posted with vodpod

June 21, 2010. Tags: , , , , , , , , , , . Economy, Finance, Foreclosures, Housing, Obama Administration, Politics, Taxes, Unemployment Statistics, Wall St. Comments off.

RealtyTrac: More Foreclosure Trouble Ahead

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Courtesy of WSJ:

The foreclosure crisis is far from over, according to RealtyTrac’s Rick Sharga. The company will release its year-end report on Thursday showing foreclosures rose 20% over the previous year. He talks with Dawn Wotapka about some trouble spots and the outlook for 2010.

more about “RealtyTrac: More Foreclosure Trouble …“, posted with vodpod

January 13, 2010. Tags: , , , , , , , , , , , . Economy, Finance, Foreclosures, Housing, Obama Administration, Politics, TARP, Unemployment Statistics, Wall St. Comments off.

Martin Feldstein on the Economic Outlook

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Double Dutch bus Dip recession coming down the street…Marty sees Q1 10 down too….need organic growth baby…Marty was invited to Jobs Summit but not attending, he says we need to give people confidence taxes not going up and to do that we should put health care on hold and stop spending. Imagine that! Remember when Obama kept citing Marty’s support as a sign of his moderate nature. I do.

more about “Martin Feldstein on the Economic Outlook“, posted with vodpod

December 3, 2009. Tags: , , , , , , . Economy, Finance, Obama Administration, Politics, Unemployment Statistics, Wall St. Comments off.

Obama mentions possibility of double dip recession in interview with Major Garrett!!!

Funny how he goes to see our bankers in China and is suddenly oh so concerned about overspending and a double dip aint it? yeah. Maybe next Tea Party we should write our signs in Mandarin and he will pay attention?

Our sign at the Tax Day Tea Party April 15th, next time maybe we should try Mandarin, that seems to work for Obama a bit better...

Update: Obama ‘Too much debt could fuel double dip recession’ ANOTHER keeper for the NO SHXT SHERLOCK FILES!!!!! But keep ramming that health care bill through fer shure, frakkers.

…It is important though to recognize if we keep on adding to the debt, even in the midst of this recovery, that at some point, people could lose confidence in the U.S. economy in a way that could actually lead to a double-dip recession,” he said. Fox News, which released a transcript of the interview, showed that comment by Obama on Wednesday morning and said the full discussion would be broadcast later in the day.

A-HA!!! J-accuse!! Knew it, Dammit!! MiM has been all over this double dip for A YEAR!! Arrgle!! and the fools KEEP SPENDING!!

Fox and friends played a snippet of tonights interview with Major Garrett and Obama in China and Obama mentioned the double dip! this can only mean IMO that they have already told him we WILL have a double dip.

dammit! they should NOT BE PASSING THIS HEALTHCARE BILL!!! AND China has CLEARLY laid down the law on the deficit! Are YOU ready for higher taxes?!?! They are going to pass this trillion and then raise all our taxes to keep China happy!!! ARRRRRRGGGLLEEE!!!!

Lookee where we will be BEFORE the new taxes to keep China happy and holding our debt:

Here is the team of GENIUSES who got us here, including Timmeh Geithner who People Magazine actually voted one of the top 100 best looking people, a frakkin CLUE there was a mass delusion in the media:

Obama Economic Team Vogues last November

November 18, 2009. Tags: , , , , , . Cabinet, Economy, Finance, Obama Administration, Politics, Taxes. Comments off.

Meredith Whitney: “I am the most bearish I have been in a year”

Meredith Whitney agrees with MiM and thinks we will have a double dip. She echoed the sentiments of this morning’s post. “I don’t know what’s going on in the market right now because it makes no sense to me,” she said.

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Airtime  Mon. Nov. 16 2009   1:11 PM ET

CNBC: Stocks are overvalued and the US economy is likely to fall back into a recession next year, well-known analyst Meredith Whitney told CNBC…The banking index has advanced some 136 percent but the sector may have been at least fairly valued, says Meredith Whitney, Meredith Whitney Advisory Group CEO. In a wide-ranging interview, Whitney, CEO of the Meredith Whitney Advisory Group, also said:

“I haven’t been this bearish in a year,” she said in a live interview. “I look at the board and every single stock from Tiffany to Bank of America to Caterpillar is up. But there is no fundamental rooting as to why these names are up—particularly in the consumer space.”

  • She was disappointed that Fed Chairman Ben Bernanke didn’t spell out how the Federal Reserve planned to exit “the biggest Fed program to date, which is the mortgage-backed purchase program.” In a speech earlier Thursday, Bernanke said the central bank was watching the dollar’s decline but is likely to keep interest rates low.
  • The US consumer was going through the biggest credit contraction ever—even bigger than that during the Great Depression. “That credit contraction is accelerating,” she said. “There’s nowhere to hide at this point.”
  • The banking sector is not adequately capitalized and will need to raise more capital in the coming year.
  • The residential real estate market is likely to worsen and remains a much bigger threat than the commercial property market. The government’s mortgage modification program won’t result in any major improvement in homeowners’ ability to stay above water, she added.

“I don’t know what’s going on in the market right now because it makes no sense to me,” she said.

“The scariest thing about the Fed’s program is that the money on the sidelines isn’t going to support that asset class,” she added. “So the trillion dollars of Fannie (Mae), Freddie (Mac) and mortgage-backed securities that the Fed is holding—there’s no substitute buyer there.”

more about “Meredith Whitney: “I am the most bear…“, posted with vodpod

November 16, 2009. Tags: , , , , , , . Economy, Finance, Foreclosures, Housing, Unemployment Statistics, Wall St. Comments off.

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