Saving Money is Bad for the Economy: Personal Savings Rate Higher, Consumption Slightly Up, Banks get new American Express, and Markets Begging for Money.
Last month the savings rate hit the 5 percent mark. That makes two months over 4 percent and for the first time in a decade that Americans have actually saved more than 4 percent for two consecutive months. Saved 4 percent of what? Of their personal income. You would think that most people would be [...]
Dow and S&P 500: Is 2009 a Redux of 1938 and 1939? Powerful Spring through Summer Rallies. Market on Track for best Month in Decades.
The recent market rally is going down in the record books. The S&P 500 is up 21 percent in a matter of 3 weeks, which is one of the strongest short-term rallies in the books. In fact, we are on track for our best month since 1987. Yet this rally has the ominous signs of [...]
Banking Transparency Gone: The Federal Reserve has been Slowly Moving to more Archaic Forms of Creating Credit. New Plan Will Subsidize Casino Loans for Investors with Taxpayer Money.
While the public is exercising a Freudian fixation on the A.I.G. scandal, misguidedly thinking that A.I.G. is an American company in the sense of G.M. or Ford (it is not although many Americans see a Rorschach American company), the Federal Reserve just decided to increase its balance sheet by $1.2 trillion. This unprecedented action was [...]
The Ports of America: Long Beach and Los Angeles Ports see Massive Drops in Cargo. The Concrete Mouth of Consumerism.
The port of Los Angeles and Long Beach are the two busiest ports in the United States. The port of Los Angeles is located in San Pedro Bay which is only a few miles away from the port of Long Beach. Make no mistake, these two ports are incredibly busy ports that provide the spine [...]
The Long Depression of 1873: Parallels and Comparisons. Are we Missing Economic Information from an Important Piece of American Financial History?
There have been many comparisons to the Great Depression with our current economic crisis. Massive speculation, rampant problems in the banking system, and exponential jumps in unemployment. Yet we may have a lot to learn by looking at the former Great Depression known as the Long Depression. The Long Depression lasted 65 months starting in [...]
Where the Jobs Are and Baby Boomers: Healthcare Growth and the Feeding of a Graying Population. Is a Post-Baby Boomer Society good for our Economic Competitiveness?
Seventy-six million American babies were born between 1946 and 1960 and we call this group the baby boomer group. Many trends can be seen coming with this group. Major toy sellers including Mattel came about this time. In fact, much of their success included this right timing since Mattel was founded in 1945, just in [...]
The Red, White, and Blue Queen’s Race: The Economy Reverts to Historical Inflation Patterns: Stock Market and Real Estate Fall back in Line with Inflation. Working Harder Just to Stay in the Same Spot.
The Red Queen’s race is a situation that appears in Lewis Carroll’s Through the Looking-Glass where one has to run faster and faster just to remain in the same spot. Imagine a treadmill that increases in speed every 10 minutes yet you don’t burn calories at the higher rate. Many Americans are feeling as if [...]
Stock Market Volatility Back Again: The S&P 500 has had 3 Major 10+ Percent Moves to Downside Already in 2009: -13.8%, -14.4%, and -11.1%. Market Volatility a Sign of Unhealthy Markets, and We’ve only gone through 2 Full Months.
The S&P 500 has lost 26% of its value in 2009 and we are only in March. This comes on the back of the S&P 500 losing 36% of its value in 2008. Market volatility is typically a sign of major uncertainty and while we did have a slightly stable period once we bounced off [...]
Major Trends in Employment: College Graduates Now Facing Higher Unemployment, U-6 Rate now at 14.8%, and 4.3 million jobs lost during this Recession.
The BLS has put out its monthly employment report and the data is once again showing weakness in the U.S. employment market. What we are now seeing is conformation that this will in fact be the deepest and longest recession since the Great Depression. What is more troubling is in light of the multiple bailouts [...]
Gas Prices going up and Bailing out a Hedge Fund: Why the Average American is Getting Bailout Fatigue. TALF a bailout for Corporations under guise of Lending for Average Americans.
Most Americans are having a challenging time digesting the bitter fruit of all the financial news coming from Wall Street and D.C. It is hard for many to wrap their brains around what is going on. In fact, today Ben Bernanke just stated that AIG was operating like a hedge fund. Which of course begs [...]