FT.com / Comment / Opinion – Exploding debt threatens America

FT.com / Comment / Opinion – Exploding debt threatens America

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Crisis spurs spike in ‘suburban survivalists’ – Yahoo! Finance

Crisis spurs spike in ‘suburban survivalists’ – Yahoo! Finance

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Is-Your-Home-a-Good-Investment: Personal Finance News from Yahoo! Finance

Is-Your-Home-a-Good-Investment: Personal Finance News from Yahoo! Finance

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Slumping Treasury bond prices send stocks lower – Yahoo! Finance

Slumping Treasury bond prices send stocks lower – Yahoo! Finance

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Nothing Will Stop House Prices From Tanking But Low Rates Help: Tech Ticker, Yahoo! Finance

Everyone agrees that the economy won’t recover until house prices stop falling, and the government is frantically trying to find ways to make that happen. Alas, there’s nothing that can be done to stop the fall, says Whitney Tilson, author of More Mortgage Meltdown: 6 Ways To Profit From These Bad Times.But the government’s decision to aggressive reduce mortgage rates is helping, Tilson says. The artificially low rates (produced by the Fed buying mortgage securities) have reduced the impact of violent mortgage-rate “resets” that were driving many homeowners into foreclosure. They’re also allowing families to refinance at a lower rate and thus have more money to spend.Some worry that creating artificially low rates is just “kicking the can down the road”–delaying the inevitable foreclosures and thus dragging out the housing cycle. In some cases, Tilson says, this is in fact what is happening. But overall, low rates are allowing the country and economy to absorb the body-blow of tanking house prices more gradually. And because the real “subsidy” is coming from those who are lending money to the US government at startlingly low rates, this bailout (unlike most of the others) is not coming at the expense of the taxpayer.

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Credit Crisis Watch – John Mauldin’s Outside the Box – InvestorsInsight.com | Financial Intelligence, Advice

Credit Crisis Watch – John Mauldin’s Outside the Box – InvestorsInsight.com | Financial Intelligence, Advice & Research / Investment Strategies & Planning for Individual Investors.

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Buy SPDR Gold Shares (GLD)

Gold ETF - "GLD"

Gold ETF - "GLD"

Bank of America-Merrill Lynch continues to recommend gold to its clients.

In its May 21, 2009 report to clients, the bank wrote:  “Gold has long been used as a hedge in times of heightened geopolitical instability, rising trade protectionism, 0% central bank target rates, and both inflation and deflation.

So, when we see headlines like this pop up on our Bloomberg – ‘Ahmadinejad Says Iran Successfully Tests Missile’ or ‘Arms Sent by US May Be Ending Up in Taliban Hands’ in yesterday’s New York Times, we believe it is important that we reiterate our view.

In the interim, we see that the dollar has been shaky in recent weeks, having dropped nearly 9% since early March, and that just bolsters our case for gold.”

5/21/09 Bank of America-Merrill Lynch, “Morning Market Tidbits”.

“The Worst Is Yet to Come” If You’re Not Petrified You’re Not Paying Attention: Tech Ticker, Yahoo! Finance

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The green shoots story took a bit of hit this week between data on April retail sales, weekly jobless claims and foreclosures. But the whole concept of the economy finding its footing was “preposterous” to begin with, says Howard Davidowitz, chairman of Davidowitz & Associates.”We’re in a complete mess and the consumer is smart enough to know it,” says Davidowitz, whose firm does consulting for the retail industry. “If the consumer isn’t petrified, he or she is a damn fool.”Davidowitz, who is nothing if not opinionated (and colorful), paints a very grim picture: “The worst is yet to come with consumers and banks,” he says. “This country is going into a 10-year decline. Living standards will never be the same.”This outlook is based on the following main points: * With the unemployment rate rising into double digits – and that’s not counting the millions of “underemployed” Americans – consumers are hitting the breaks, which is having a huge impact, given consumer spending accounts for about 70% of economic activity. * Rising unemployment and the $8 trillion negative wealth effect of housing mean more Americans will default on not just mortgages but student loans and auto loans and credit card debt. * More consumer loan defaults will hit banks, which are also threatened by what Davidowitz calls a “depression” in commercial real estate, noting the recent bankruptcy of General Growth Properties and distressed sales by Developers Diversified and other REITs. As for all the hullabaloo about the stress tests, he says they were a sham and part of a “con game to get private money to finance these institutions because [Treasury] can’t get more money from Congress. It’s the ‘greater fool’ theory.””We’re now in Barack Obama’s world where money goes into the most inefficient parts of the economy and we’re bailing everyone out,” says Daviowitz, who opposes bailouts for financials and automakers alike. “The bailout money is in the sewer and gone.”

Obama and Geithner Are Bigger Scammers than Madoff

If the goal of Tim Geithner and other regulators was “to rip off the American taxpayer for the benefit of the least-deserving wealthiest people you can imagine, well – mission accomplished,” Black says. While much of the focus is on the stress tests and banks’ efforts to raise cash, the real story is Geithner’s Public-Private Investment Program (PPIP), says William Black, an Associate Professor of Economics and Law at the University of Missouri – Kansas City.The PPIP is the “greatest boondoggle in the history of the world,” says Black, a former bank regulator who was counsel to the Federal Home Loan Bank Board during the S&L crisis. As occurred during the S&L era, Black says the PPIP will allow banks to exchange “trash for cash” and turn “real losses into faulty gains.”

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Jim Rogers says “The Dollar is Doomed”

Jim Rogers says “The Dollar is Doomed”