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drbubb

Getting out of Depression, a Challenge. Even as stocks break out.

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Getting out of Depression - First, you admit you are in one...

 

Here's Webster Tarpley's Plan:

I find it hard to listen to anyone who says anything good about Paul Krugman, but I did like parts of Tarpley's ideas. And the overall discussionw as worthwhile.

 

Webster G. Tarpley on The Jeff Rense Program February 6, 2013

VIDEO

 

 

Beyond Fiscal Stimulus and Monetary Stimulus: How to Force the Fed to Finance an Infrastructure-Led Recovery Using Credit Stimulus

 

YT comment

==

Terrence Moonseed 1 week ago

I like Tarpley and Ron Paul. Tarpley just thought Ron Paul was wasting his time with repuplicans, and he was right, they thwarted him and lost him the election, Tarpley knew he would never win, but he still likes his principals, and he gave him credit for at least trying. I follow Tarpley and Paul, theyre both quite active in the infowar

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Tarpley talks often about SPENDING MONEY ON INFRASTRUCTURE

 

transportdubai-882x300.jpg

 

But it matters a great deal on HOW you spend it !

 

Spending a great deal of it on highways, pumping up the failing Suburban experiment,

would be an unmitigated disaster - it would plunge the US deeper into its crazy Cash-drain Economy.

 

Spend it on Urban Metro rail projects, backed up by sensible Urban Planning, with new zoning laws,

encouraging densification around the rail stations (with taxes on property appreciation), and

you have real formula for success.

 

===================

 

The Four Cash-Drains, dragging down the US economy ... Estimated annual cash drain*:

 

1. Car-dependency and the Suburban economy / Oil imports: $500 billion. p.a.

 

2. Foreign military entanglements / Foreign wars and overseas bases; $500bn - $1trillion p.a.

 

3. Disease maintenance and drug pushing / Unneeded legal and illegal drugs: $250 billion p.a.

 

4. Predatory financial system / Extra fees and unneccesary borrowing : $250 billion p.a.

 

===================

 

Maybe $2 Trillion per annum, American wealth, wasted on unnecessary spending

 

 

*these are very preliminary estimates, which I will refine when I get more data.

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I want to watch XLF as a Bellwether for the next downturn in stocks

 

XLF / Financials - A Bellwether to track ... All Data-D-chart : Xyrs-chart

 

xlf.gif

 

99269389.gif

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(RECEIVED BY EMAIL):

 

20 Signs That The U.S. Economy

Is Heading For Big Trouble In The Months Ahead

 

"Like 2008 before the Crash"

 

By Michael, on February 20th, 2013

 

Is the U.S. economy about to experience a major downturn? Unfortunately, there are a whole bunch of signs that economic activity in the United States is really slowing down right now. Freight volumes and freight expenditures are way down, consumer confidence has declined sharply, major retail chains all over America are closing hundreds of stores, and the "sequester" threatens to give the American people their first significant opportunity to experience what "austerity" tastes like. Gas prices are going up rapidly, corporate insiders are dumping massive amounts of stock and there are high profile corporate bankruptcies in the news almost every single day now. In many ways, what we are going through right now feels very similar to 2008 before the crash happened. Back then the warning signs of economic trouble were very obvious, but our politicians and the mainstream media insisted that everything was just fine, and the stock market was very much detached from reality. When the stock market did finally catch up with reality, it happened very, very rapidly. Sadly, most people do not appear to have learned any lessons from the crisis of 2008. Americans continue to rack up staggering amounts of debt, and Wall Street is more reckless than ever. As a society, we seem to have concluded that 2008 was just a temporary malfunction rather than an indication that our entire system was fundamentally flawed. In the end, we will pay a great price for our overconfidence and our recklessness.

 

So what will the rest of 2013 bring?

 

Hopefully the economy will remain stable for as long as possible, but right now things do not look particularly promising.

The following are 20 signs that the U.S. economy is heading for big trouble in the months ahead...

 

#1 Freight shipment volumes have hit their lowest level in two years, and freight expenditures have gone negative for the first time since the last recession.

#2 The average price of a gallon of gasoline has risen by more than 50 cents over the past two months. This is making things tougher on our economy, because nearly every form of economic activity involves moving people or goods around.

#3 Reader's Digest, once one of the most popular magazines in the world, has filed for bankruptcy.

#4 Atlantic City's newest casino, Revel, has just filed for bankruptcy. It had been hoped that Revel would help lead a turnaround for Atlantic City.

#5 A state-appointed review board has determined that there is "no satisfactory plan" to solve Detroit's financial emergency, and many believe that bankruptcy is imminent. If Detroit does declare bankruptcy, it will be the largest municipal bankruptcy in U.S. history.

#6 David Gallagher, the CEO of Town Sports International, recently said that his company is struggling right now because consumers simply do not have as much disposable income anymore...

 

"As we moved into January membership trends were tracking to expectations in the first half of the month, but fell off track and did not meet our expectations in the second half of the month. We believe the driver of this was the rapid decline in consumer sentiment that has been reported and is connected to the reduction in net pay consumers earn given the changes in tax rates that went into effect in January."

 

#7 According to the Conference Board, consumer confidence in the U.S. has hit its lowest level in more than a year.

#8 Sales of the Apple iPhone have been slower than projected, and as a result Chinese manufacturing giant FoxConn has instituted a hiring freeze. The following is from a CNET report that was posted on Wednesday...

 

The Financial Times noted that it was the first time since a 2009 downturn that the company opted to halt hiring in all of its facilities across the country. The publication talked to multiple recruiters.

The actions taken by Foxconn fuel the concern over the perceived weakened demand for the iPhone 5 and slumping sentiment around Apple in general, with production activity a leading indicator of interest in the product.

 

#9 In 2012, global cell phone sales posted their first decline since the end of the last recession.

#10 We appear to be in the midst of a "retail apocalypse". It is being projected that Sears, J.C. Penney, Best Buy and RadioShack will also close hundreds of stores by the end of 2013.

#11 An internal memo authored by a Wal-Mart executive that was recently leaked to the press said that February sales were a "total disaster" and that the beginning of February was the "worst start to a month I have seen in my ~7 years with the company."

#12 If Congress does not do anything and "sequestration" goes into effect on March 1st, the Pentagon says that approximately 800,000 civilian employees will be facing mandatory furloughs.

#13 Barack Obama is admitting that the "sequester" could have a crippling impact on the U.S. economy. The following is from a recent CNBC article...

 

Obama cautioned that if the $85 billion in immediate cuts -- known as the sequester -- occur, the full range of government would feel the effects. Among those he listed: furloughed FBI agents, reductions in spending for communities to pay police and fire personnel and teachers, and decreased ability to respond to threats around the world.

He said the consequences would be felt across the economy.

"People will lose their jobs," he said. "The unemployment rate might tick up again."

 

#14 If the "sequester" is allowed to go into effect, the CBO is projecting that it will cause U.S. GDP growth to go down by at least 0.6 percent and that it will "reduce job growth by 750,000 jobs".

#15 According to a recent Gallup survey, 65 percent of all Americans believe that 2013 will be a year of "economic difficulty", and 50 percent of all Americans believe that the "best days" of America are now in the past.

#16 U.S. GDP actually contracted at an annual rate of 0.1 percent during the fourth quarter of 2012. This was the first GDP contraction that the official numbers have shown in more than three years.

#17 For the entire year of 2012, U.S. GDP growth was only about 1.5 percent. According to Art Cashin, every time GDP growth has fallen this low for an entire year, the U.S. economy has always ended up going into a recession.

#18 The global economy overall is really starting to slow down...

 

The world's richest countries saw their economies contract for the first time in almost four years during the final three months of 2012, the Organisation for Economic Co-operation and Development said.

The Paris-based thinktank said gross domestic product across its 34 member states fell by 0.2% – breaking a period of rising activity stretching back to a 2.3% slump in output in the first quarter of 2009.

All the major economies of the OECD – the US, Japan, Germany, France, Italy and the UK – have already reported falls in output at the end of 2012, with the thinktank noting that the steepest declines had been seen in the European Union, where GDP fell by 0.5%. Canada is the only member of the G7
currently on course to register an increase in national output
.

 

#19 Corporate insiders are dumping enormous amounts of stock right now. Do they know something that we don't?

#20 Even some of the biggest names on Wall Street are warning that we are heading for an economic collapse. For example, Seth Klarman, one of the most respected investors on Wall Street, said in his year-end letter that the collapse of the U.S. financial system could happen at any time...

 

"Investing today may well be harder than it has been at any time in our three decades of existence," writes Seth Klarman in his year-end letter. The Fed's "relentless interventions and manipulations" have left few purchase targets for Baupost, he laments. "(The) underpinnings of our economy and financial system are so precarious that the un-abating risks of collapse dwarf all other factors."

 

So what do you think is going to happen to the U.S. economy in the months ahead?

===

Source: http://theeconomicco...he-months-ahead

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(My response to that article was):

 

It looks to me, like we are set for another big downturn in stocks starting this month.

 

I am getting many warnings from my indicators

Like this one:

 

DrBubb's "Early Warning System"

 

Leading Ratio ... LQD:TLT-Weekly-3yrs : Copper : HG price : CU price : SPY-10/11 : SMH-6mos

 

lqdetc.png

 

I reckon that the LQD-to-TLT ratio should move in harmony with stocks, or maybe lead stock moves. If they are moving in different directions, then one should be cautious.

 

It is the RATIO of Liquid Corporate Bonds (LQD) to Treasury Bonds (TLT) and usually leads Stocks lower.

In effect, it shows that credit is tightening for Corporations, relative to the US Treasuries - and also shows a flight to safety (away from the "Risk On" trade - being long equities.)

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...

The Four Cash-Drains, dragging down the US economy ... Estimated annual cash drain*:

 

1. Car-dependency and the Suburban economy / Oil imports: $500 billion. p.a.

 

2. Foreign military entanglements / Foreign wars and overseas bases; $500bn - $1trillion p.a.

 

3. Disease maintenance and drug pushing / Unneeded legal and illegal drugs: $250 billion p.a.

 

4. Predatory financial system / Extra fees and unneccesary borrowing : $250 billion p.a.

...

 

4. is the only problem here.

 

1-3 are consequences that would not otherwise be possible.

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I never liked The Readers Digest.

 

Yeah. Me too.

These items are a bit more serious:

 

#14 If the "sequester" is allowed to go into effect, the CBO is projecting that it will cause U.S. GDP growth to go down by at least 0.6 percent and that it will "reduce job growth by 750,000 jobs".

#15 According to a recent Gallup survey, 65 percent of all Americans believe that 2013 will be a year of "economic difficulty", and 50 percent of all Americans believe that the "best days" of America are now in the past.

#16 U.S. GDP actually contracted at an annual rate of 0.1 percent during the fourth quarter of 2012. This was the first GDP contraction that the official numbers have shown in more than three years.

#17 For the entire year of 2012, U.S. GDP growth was only about 1.5 percent. According to Art Cashin, every time GDP growth has fallen this low for an entire year, the U.S. economy has always ended up going into a recession.

===

 

Perhaps that is why we are beginning to get these CLUES of a possible Rollover in stocks.

Here's another - a composite of the above, I suppose

 

Here is a chart showing the RATIO of XLF-Financials to TLT-Bonds

xlftotlt.png

 

What I see in this chart, is the beginning of a possible shift from financial stocks into bonds, despite the very low yield in those bonds.

 

Let's see if this emerging shift picks up speed.

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The Fed's Fighting a Depression, says Jim Rickards

 

http://www.youtube.com/watch?v=JwssgNDIwGI

 

"The US is an importing nation.

The real story is that the US wants to import inflation, through higher import prices."

 

(The UK too, I suspect... given the weak currency there.)

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More Than 30% of U.S. Population Unemployed

 

Date: Monday, 11-Mar-2013 01:35:57

 

A World’s Record: More Than 30% of U.S. Population Unemployed

March 8th, 2013

The number of Americans designated as “not in the labor force” in February was 89,304,000, a record high, up from 89,008,000 in January, according to the Department of Labor. This means that the number of Americans not in the labor force increased 296,000 between January and February.

The Bureau of Labor Statistics (BLS) labels people who are unemployed and no longer looking for work as “not in the labor force,” including people who have retired on schedule, taken early retirement, or simply given up looking for work.

 

The increase marks the second month in a row, after rising in January from 88.8 million in December. Those not in the labor force had declined in December from 88.9 million in November.

http://cnsnews.com/n...mployed-january

89 million not in the labor force = 29%, give or take, assuming the US population is 310,000,000 + official unemployment 7.7%

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bankers-what-now-249.jpg

 

(From Tom Heneghan):

U.S. Treasury vs Federal Reserve It Is Getting Ugly

 

This sounds scary:

 

Speaking of JPMorgan and Goldman Sachs, last Friday the U.S. Treasury did a preemptive strike against the criminal privately owned Federal Reserve when they leaked the real stress tests on JPMorgan and Goldman Sachs.

 

The stress tests proved negative.

 

The stress tests detailed that the two aforementioned banking gangsters have massive exposure to derivative debt and have record over margined positions using illegal cross-collateralized derivatives on the corrupt London LIFFE exchange utilizing naked options in the rigging of foreign currency, precious metals and stock index future contracts that are traded on worldwide financial markets.

 

Note: The U.S. Treasury is now in position of 'smoking gun' evidence that proves that JPMorgan and Goldman Sachs current spread sheets are 85% worthless derivatives and only 15% cash.

 

... But I have no idea what he means by "Derivative Debt" (?), and I am a genuine expert in that field.

From his comments, it is very clear to me that he lacks any genuine expertise in derivatives.

 

SO: Let's take his comments, with a Big GRAIN OF SALT !

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Resistance Broken !

 

bankvault.png

 

Now that (expected) resistance has been broken... I have to take the Bull Case more seriously.

And a Bull who has been accurate, is getting ...

 

 

MORE BULLISH !

 

Tony C. has just RAISED his target for the Stock Bull Market

 

spxweekly1.png

 

...the SPX has already reached our minimum upside target range of 1536-1556. Considering the wave structure, the Time Cycle analysis below, and taking into account QE 3, we are now raising the upside target to SPX 1650-1700 by Q1 of 2014. Details below.

 

TIME CYCLES

This week the DOW broke out to all time new highs in a perfect wave location: Int. iii of Major 3 of Primary III, or 3 of 3 of 3. For comparison purposes we took a look at the last ‘breakout to all time highs’ in 2006. We then adjusted the wave count of that bull market as if it too were a Cycle wave. Under that wave count the previous ‘breakout’ was also at Int. iii of Major 3 of Primary III. A perfect fit, but there is more.

During the 2002-2007 bull market it took exactly 48 months of bull market activity before the breakout occurred. Then the market topped exactly 12 months later. That bull market began in Oct02, broke out in Oct06, and topped in Oct07. This 2009-2013 bull market has also taken exactly 48 months before the ‘breakout’. The bull began in Mar09, broke out Mar13, which now suggests a bull market top in Mar14.

===

/more: http://caldaro.wordpress.com/

 

I have to admit: His track record has been excellent, since I have started following him.

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"Austerity Fatigue is colliding with Bailout Fatigue"

 

VIDEO:

 

Roubini Says Austerity Backlash Big Economic Risk

 

http://www.bloomberg...Vs~pADzx~Q.html

 

March 8 (Bloomberg) -- Nouriel Roubini, co-founder of Roubini Global Economics LLC, talks about the European sovereign-debt crisis, the outlook for central bank monetary policy and risks of an asset "bubble." He speaks with Bloomberg Television's Mark Barton from the sidelines of the Ambrosetti workshop in Cernobbio, Italy. (Source: Bloomberg)

 

"ECB could cut the discount rate to negative."

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I recommend this video

 

 

Published on Mar 13, 2013

Jeremy Grantham, Chief Investment Strategist of Grantham Mayo Van Otterloo

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