El Erian: the contagion of the Greek debt crisis and insolvency of sovereign debt

Changed post title, CNBC had a bad title there, El Erian did not say it was frightening, he said we have serious concerns over the contagion and solvency…

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Yesterday’s interview, which CNBC tried to blame for the market plunge, lol:

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May 7, 2010. Tags: , , , , , , , , , , . Economy, Finance, Politics, Taxes, Unemployment Statistics, Wall St. Comments off.

Bill Gross: ‘this recovery will be different’

Bill Gross, PIMCO, reiterates the new normal, the recovery, the end of stimulus, the consumer continuing to deleverage and the impact on the American economy

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…Speaking just after the government said January saw the loss of another 20,000 jobs even as the unemployment rate fell to 9.7 percent, the Pimco co-CIO said the jobs weakness will make for a difficult transition to prosperity.

“We think that it’s substantially different this time, based upon the fact that instead of levering we’re delevering and instead of deregulating we’re regulating,” Gross said. “Both of those conditions in combination produce a very weak economy, very slow growth and ultimately have effects on asset markets that depend on asset appreciation.”

…”Four percent growth in the first quarter is probably a reasonable expectation,” he said. “But the unemployment is a long-term structural problem.”…

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February 5, 2010. Tags: , , , , , , , , , . Economy, Finance, Labor Department, Obama Administration, Politics, TARP, Taxes, Unemployment Statistics, Wall St. Comments off.

More happy talk from Bill Gross: “The standard of living in the US is likely to go down with the dollar, as “we’ve spent too much” over the past 20 years…


October 28, 2009. Tags: , , , , , , , , , , , , , , . Economy, Finance, Housing, Obama Administration, Politics, Unemployment Statistics, Wall St. Comments off.

El-Erian: More job losses, sluggish growth in 2010…

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“We think that the second half of 2009 will be turbo charged by the stimulus and there will be a hand off to the consumer and that’s what you want,” El-Erian said. “But it’s going to be challenging. We worry that 2010 is going to have sluggish growth and high unemployment and lower valuations.”

As for the run up in gold prices, El-Erian said it’s not a good sign for the US economy.“I worry when I see gold doing what it’s doing and the dollar doing what it’s doing,” El-Erian said. “It’s an indication that the world is starting to worry about the US and we have to take these signals seriously.”

As for the run on corporate bonds, El-Erian said caution should be exercised. “It’s been a wonderful run but most recently, money is being pushed into the sector,” El-Erian said. “I would focus on high grade companies, companies that have their financials and operating leverage under control.”

El-Erian also said now is not the time for risk in the stock market. “I would reduce risk and wait for a better time,” said El-Erian. “I think there are a lot of people chasing risk assets now for a lot of reasons, but the long term investor can be patient because the economy is likely to face strong head winds in 2010.”

At 4:17 in El-Erian notes he is concerned about ongoing govt involvement in the markets..him and 130 million Americans on Main St are worried about it too!!

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October 6, 2009. Tags: , , , , , , , , . Economy, Finance, Obama Administration, Politics, Unemployment Statistics, Wall St. Comments off.

‘Barney Fife’ Stock Market Ready for a pullback: Bill Gross

LOL, Axelrasputin and TOTUS practice the preamble? BWAAAHAAAAAA!!!

When PIMCO speaks, the Fed listen, lol. ‘With nearly $1 trillion assets under management, Gross runs the largest bond fund in the world at Pimco.’

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William Gross, of Pimco; Robert Doll, of BlackRock; and Daniel Tishman, of Tishman Construction, share their market insight.

“We’ve got a Barney Fife market. Not sure what Barney would say about the market—you could imagine some sort of goofy, speculative market running far too high,” Gross said in a live interview. “We think the market…is due for a pullback or setback only because it’s gone so far and economic growth cannot go so far.”

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Andy Griffith Show courtesy of hd95

September 22, 2009. Tags: , , , , , , , , . Economy, Finance, Obama Administration, Politics, Unemployment Statistics, Wall St. 2 comments.

Economy: Marty Feldstein says we may see second dip; what about that housing data?

There you go. Now Feldstein is on board with the W shaped recovery (like we under edumacated consumers who actually buy the stuff we import and produce!) . This comes weeks after Geithner and Summers were off the rez talking about the possibility of tax hikes for the middle class. Buffet (another person TOTUS liked to wave around as proof of his moderateness in the primaries) is also calling for caution calling Hey Big Spender to D.C. in editorials and is expecting the dollar to drop…

Bernanke and the Fed seem to be expecting a long flat bottom to the L shape. PIMCO is on record with 1-2% GDP growth for a generation. Now we have Feldstein and Buffet on record the spending has to stop and TOTUS still clinging to his tax promises which are written in smoke….

The only way I see to avoid the double dip is for Team TOTUS to start governing as moderates and staunch the bleeding of the red ink and the pillaging of the drivers of GROWTH (ie private capital and comfy consumers who feel safe spending)…

What about the housing data today? We had a 7+% jump in existing home sales. Break it down with Diana Olick on CNBC

U.S. Existing Home Sales Yr/Yr
$0 – $100,000 Up 38.8%
100,000 – $250,000 Up 8.7%
$250,000 – $500,000 Down 6.2%
$500,000 – $750,000 Down 8.9%
$750,000 – $1,000,000 Down 10.6%
$1,000,000 – $2,000,000 Down 23.3%
$2,000,000 + Down 32.4%
Source:  National Association of Realtors

Averages rallying on the surface data DOW up 135 to 9486; S&P up 16 to 1023 and NAS up 23 to 2012. But the drill down data is not as rosy as the topline number would appear. We have short sales, foreclosures on the very bottom end homes <100k jumping almost 40% but the mid to top end is flat to negative..WSJ:

A survey found that one in eight U.S. households with mortgages was in foreclosure or behind on its mortgage payments during the second quarter, putting added pressure on programs aimed at preventing foreclosures.

While foreclosure starts have slowed on the subprime loans that ignited the mortgage and banking crisis, loans extended to borrowers with good credit are deteriorating at a faster clip as falling home prices and mounting job losses weigh on more households.

The Mortgage Bankers Association said its latest survey, released Thursday, showed that 13.2% of mortgages on homes with one to four units were at least a month overdue or in the foreclosure process in the April-to-June period, up from 12.1% in the first quarter and 9% a year earlier.

As home sales have picked up in recent months, some were expecting foreclosures and delinquencies to ease. But Jay Brinkmann, chief economist at the MBA, said foreclosures weren’t expected to peak until later in 2010 when the economy improves.

“Just because we see prices level off doesn’t necessarily mean we’ll see a big reduction in foreclosures,” said Mr. Brinkmann, in part because many homeowners would still owe more than their homes were worth…

WSJ - Nick Timiraos

WSJ - Nick Timiraos

The foreclosure numbers are rising along with unemployment. This is a long shallow bottom if the anti capitalistic interventions in the markets and economy at large stop.

It is the first leg down on a ladder to Carterville if they ignore the public sentiment (we being 70% of our economy and the impetus for inventory buildup and job creation) which is expressing itself not just at townhalls but in the weak consumer sentiment and spending data….

Leave the economy alone! Leave it alone!

Sweet Charity courtesy of jwsnowden

August 21, 2009. Tags: , , , , , , , , , , . Economy, Film, Finance, Foreclosures, Healthcare, Housing, Immigration, Labor Department, Obama Administration, Politics, Taxes, Unemployment Statistics, Wall St. 2 comments.

Market on ‘Sugar High,’ Economy Still Asleep: El-Erian – CNBC.com

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The stock market spent July on a “sugar high,” rising to levels not justified by an economy that is still limping along, Pimco’s Mohamed El-Erian told CNBC. Despite proclamations from some that the recession is over, El-Erian, co-chief executive officer of the largest bond fund manager in the world, said much more needs to happen before the economy registers real growth.

“The July part of the rally is a bit of a sugar high,” he said in a live interview. “We need final demand. We need a feeling that deleveraging in the private sector has run its course, that people feel confident now to engage in consumption, investment.” It’s not happening yet on the national level, it’s not yet happening at the global level.”El-Erian stuck with predictions from various Pimco executives recently that the economy would be mired in gross domestic product growth of about 1 to 2 percent for the foreseeable future.”We’re not going to go back to where we’ve come from,” he said.

While the banking sector has taken much of the focus during the current recession, El-Erian said it’s now about the real economy, particularly wages and unemployment. Those two areas must recover, and that will take a while, he added.

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July 29, 2009. Tags: , , , , , , , . Economy, Finance, Labor Department, Unemployment Statistics, Wall St. Comments off.

Markets & Mortgage Rates, monetizing the debt and PIMCO’s El-Erian on the Treasury markets..- CNBC.com

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Discussing the importance of keeping mortgage rates low, with Andy Serwer, Fortune; Frederic Mishkin former Federal Reserve Board governor; CNBC’s Rick Santelli & Steve Liesman

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Last week’s spike in the unemployment rate combined with rising bond yields and oil prices has created a headwind on the nation’s course to economic recovery, with Mohamed El-Erian, Pimco CEO/co-CIO.

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June 9, 2009. Tags: , , , , , , , , , , , , , . Economy, Finance, Foreclosures, Housing, Obama Administration, Politics, Unemployment Statistics, Wall St. Comments off.

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