Browse by Tags

Forecasts & Trends

Blog Subscription Form

  • Email Notifications
    Go

Have You Seen This?

Have You Seen This?

  • Economic Recovery vs. Rising Unemployment

    This Thursday, all eyes will be on the 'advance' estimate of 3Q GDP, and most analysts expect it to be positive and confirm that the US economy emerged from the recession in the July-September quarter. Yet even if the GDP report is positive on Thursday, we all know that the unemployment rate (currently 9.8%) continues to rise and is likely to go up for at least several more months.

    If the government counted everyone who is unemployed, or is working part-time because they can't find a full-time job, the real US unemployment rate was 17% as of the end of September. So even if the recession 'officially' ended in the 3Q based on this Thursday's GDP report, this economy is far from out of the woods. And if the dollar continues to fall, even more dire consequences (ie - a double-dip recession) are likely to follow. It's a lot to cover in one letter, so let's get started.

    ...
  • The Economy & the Commercial Real Estate Bust

    This week, we take a fresh look at the latest economic reports, most of which have been positive and suggest that the recession is over and the economy is rebounding. Still, I expect that economic growth will only be mild in 2010, as I discuss in this week's letter.

    Our larger topic this week is the huge problem with commercial real estate debt, which could be the next shoe to drop in the credit crisis. Commercial real estate values have plunged apprx. 39% nationwide since the recession began, and some sources believe prices could fall another 20% or so before stabilizing. This is huge, but we don't hear a lot about it, even though banks are failing at an alarming rate as a result. This is a major problem you need to be aware of, so let's get right to it.

    ...
  • Second Stimulus - Good Money After Bad

    We will touch several bases in this week's E-Letter. First, we take a close look at the latest economic data which has a few 'green shoots' but remains mostly negative, and further supports my view that we will not be out of this recession for some time to come. Second, I share my thoughts on why a second major stimulus package is not a good idea, and my thoughts on what the government should do instead. And finally, I share with you the best article I've seen on why the official monthly government 'unemployment rate' report is so under-stated. It all should make for interesting reading.

    ...
  • Have We Turned The Corner On The Recession?

    While the global recession and credit crisis are still in full swing, at least we have finally seen a few positive economic reports of late. Specifically, we have seen some good news in the housing sector where new and existing home sales actually increased nicely in February, following months and months of decline. We also saw an unexpected jump in durable goods orders for last month. These reports, along with the nice jump in the stock markets, have led several noted forecasters to suggest that we've seen the bottom in the recession and the worst of the credit crisis. I am not so convinced.

    We will also take a close look at Treasury Secretary Geithner's latest bank bailout plan that would partner government and private investors in a scheme to take toxic assets off of the banks' books, but there is no guarantee that this new plan will work. We'll also examine the Fed's latest plans to buy Treasury debt and more toxic assets from banks. Next, we'll examine the latest report from the Congressional Budget Office regarding President Obama's record large budget for 2010, which the CBO says will result in a massive $2.3 trillion deficit. Can I say, I told you so?

    It's a lot to cover in one letter, but I trust you will find it interesting....
  • Obama's Tax Policy: None Dare Call It Welfare

    We have recently learned the details of President-elect Obama's massive income tax overhaul, and the plan is much worse than we had anticipated. Obama's liberal tax plan would give annual tax rebates to millions of Americans who already pay NO income taxes whatsoever. Giving government tax rebate checks to those who already pay zero income taxes is nothing short of expanding the welfare state (or socialism as I prefer to call it). Worst of all, if Obama gets his massive tax plan approved, it will mean that a majority of Americans will pay little or no income taxes, while the so-called "wealthy" will foot the rest of the bill. If we reach such a point, there will be little to no chance of true tax reform for the foreseeable future. Read what follows very carefully....
  • Economic & Investment Outlook For 2009

    As we kick off the New Year, let's review the latest dismal economic and financial data and the consensus views of what lies ahead in 2009 for the economy, the credit crisis and the markets. As you might expect, most of my trusted sources believe that the recession will be with us for a while, but there is hope that the economy will begin to bottom out sometime late this year - aided by more huge government bailouts that President-elect Obama has in store for us....
  • It's Official - 2008 Was A Very Bad Year

    As we draw a much welcomed close on the year 2008 tomorrow, it makes sense to review what will certainly be one of the most significant years in our nation's history. I am on vacation this week, but I have reprinted two very interesting articles that reflect on what we have witnessed this year and what it may mean for the future. I trust they will make you stop and think. I'll be back to my usual writing schedule next week. I wish a very Happy New Year to you and yours!...
  • The Recession & More Government Bailouts

    Well, the 'R' Word (recession) can now be officially used to describe the US economy since the National Bureau of Economic Research (NBER) declared that we have been in a recession since December of 2007. Considering the back-dated nature of NBER's announcement, we find ourselves in the midst of the third longest recession since the Great Depression, with no end yet in sight. No wonder the Treasury and Fed are pulling out all of the stops to bail out the economy. This week, I'm going to discuss the current bleak economic picture, the Fed's latest bailout and the possible long-term consequences of the Fed's printing money....
  • Credit Crisis: Do Bush & Paulson Have A Clue?

    The latest about-face by Treasury Secretary Hank Paulson - abandoning the plan to buy up troubled assets from banks, and shifting to more large equity infusions - has lawmakers and investors wondering if President Bush and the Treasury have any clue as to how to solve the financial crisis. But before we get into that, we look at the latest analysis from Stratfor.com on the financial crisis we are in. And finally, we take a look at the current state of the economy and the recession. News continues to worsen, especially forecasts for 4Q GDP, which many economists and analysts now believe could be negative 4-5%. All of this continues to weigh on the stock markets, which as this is written, are threatening to make new lows....
  • The Democrats' Plan To Highjack Your 401(k)

    Well, election day is upon us. While the mainstream media would have us believe that the results are a foregone conclusion in Obama's favor, recent polls have indicated a narrowing of his lead over McCain in some battleground states. Obviously, we'll all just have to wait and see how the votes turn out. In the meantime, I think it's important that we conservatives notice some of the trial balloons that are being floated by the Democratic leadership. One recent proposal that would eliminate the favorable tax treatment of 401(k) plans shows us that, no matter how the election turns out, we have plenty to fear from the liberals who are already in office....
  • Uncle Sam's $700+ Billion Toxic Securities Fund

    The credit crisis has led to gridlock in the financial markets, and the stock markets have dropped like a stone. On Saturday, the Treasury Dept. and the Federal Reserve requested a massive $700+ billion bailout package that would allow the government to buy up troubled mortgage-related assets from banks and financial firms that are in trouble. Congress is reluctant to go along, but I expect they will provided they also get some money to help struggling homeowners and more oversight than the government offered initially. This week, we take a look at the latest enormous bailout plan and the latest government guarantee of money market funds. I also tell you why I believe we are now headed for a recession, and why I believe this huge financial mess will likely make Barack Obama our next president....
  • Category 2 Hits Texas, Cat 4 Hits Wall Street

    While Hurricane Ike ravaged the Gulf Coast over the weekend, there was a major financial storm on Wall Street on Saturday and Sunday. Lehman Brothers, the fourth largest US investment bank, announced on Sunday that it was filing for Chapter 11 bankruptcy. Shortly thereafter Bank of America announced that it was gobbling up brokerage giant Merrill Lynch for a mere $45-50 billion in stock. If that weren't enough, insurance giant AIG is in serious financial condition and is requesting $70-75 billion in new loans to stay afloat. These latest developments are the next chapter in the subprime mortgage/credit crisis, and they took a heavy toll on the stock markets yesterday. I will sort it all out for you in the pages that follow....
  • The Economy, The Electoral Map & The United Nations

    This week we hit several topics, beginning with the latest economic news which suggests we will not fall into a recession this year - but 2009 could be another story. Next, we ponder the stock market and whether the July lows were a bottom. We then move on to the latest analysis of the Electoral Map and pinpoint the key states McCain has to win if he is to be elected president, and I also offer my thoughts on McCain's surprising choice for VP. Finally, and most importantly, we take a close look at the Democrats' new Party Platform which contains several very troubling intentions. You need to read this article from AIM and pass it on! Let's get started....
  • Thoughts On China, The Olympics & Investing

    This week, I turn our attention to this year's Summer Olympics which will be held in China beginning this Friday, August 8 and running through the closing ceremonies on August 24, assuming all goes as planned. China has long been a mystery to the rest of the developed world, and the Olympics will no doubt shed much light on China, its communist government and its culture. Our friends at Stratfor.com offer an interesting analysis of China from a political perspective and what that might mean for the Olympics. With their permission, I have reprinted that analysis in the pages that follow - enjoy. Finally, if you are invested in China, you might consider taking some profits this week, just in case anything bad should happen during the Olympics....
  • On The Economy, The Fed & President Obama

    This week we begin by taking the pulse of the US economy, which is holding up better than most analysts have expected. 1Q growth was better than forecast, and it now looks like the 2Q will be better than expected as well. The bad news is that inflation is on the rise, and there are fears that the Fed will begin to hike interest rates soon - but then maybe not - I'll give you my take on it. Finally, we focus on the presidential race which seems to be tightening according to the national polls. I will highlight Obama's background and his positions that bother me, and why I think he is the most arrogant candidate in a long time. Finally, we will take a detailed look at the 11 "battleground" states where the race could go either way. Feel free to share this analysis as you see fit....