US says, “Where’s MY Bailout?” – One Year After Near Financial Collapse, Americans Are No Better

Rewind to Inauguration Day in January. President-elect Obama ushered in a new administration with much fanfare and hope for C-H-A-N-G-E. Now 12 months later, it’s business as usual. Take a trip down memory lane as we recall some of the highlights (and lowlights) of 2009 in the accompanying clip. We have a problem with that! Enormous bonus payouts for executives. Toxic, dangerous assets that remain on banks’ balance sheets. The same executives running firms they took to the brink with risky investment choices. The “too big to fail” institutions took the global economy to the precipice — but were saved with hefty rescue packages thanks to American taxpayers — are now bigger than ever.As summarized by one of our most popular Tech Ticker guests Howard Davidowitz, “I have a problem with that!” So do many Americans as populist outrage rises.In fact, it’s anything but business as usual for American workers who are grappling with 10% unemployment — the highest level in 26 years — and no guarantee the economic bottom is in place for 2010. While the $787 billion stimulus package has yet to filter down to local communities, it’s no wonder Americans are asking: “Where’s MY bailout?”Empire falling? Detroit is a city under siege. While Ford avoided bankruptcy, sales are down sharply. Chrysler was strong-armed into an alliance with Italy’s Fiat. The government ousted GM’s CEO Rick Wagoner. With nagging questions about America’s competitiveness and debts mounting, it’s no wonder historians like Niall Ferguson of Harvard University are contemplating the rise and fall of empires.”If you’re trying to borrow $9 trillion to bail out your financial system and your economy, and already half your public debt is owned by foreigners, it’s not really the conduct of a rising empire is it?” Ferguson asks.Stock mark rising. Sure the market has staged a phenomenal recovery off the March bottom, the lowest levels since 1997. The Dow today is firmly above 10,000. But among the bulls and bears, the debate continues on the recession’s definitive end. What the recovery will look like from here — V-shaped, W, square root? Take your pick from the alphabet, recovery soup.But as Columbia University professor and economist Joseph Stiglitz points out, for most Americans the question is: “Can they get a job?” The likelihood of a big improvement on that front anytime soon is “very remote,” Stiglitz says.Here’s a selection of Tech Ticker’s 2009 coverage: * Do the markets have no faith in Obama? * Geithner’s stress tests are ‘a complete sham’, former regulator says * Who kiled Wall Street? The Bloget-Spitzer interview * Wall Street is winning, Elizabeth Warren says * Audit the Fed then abolish it, Jim Rogers says * U.S. empire in decline, Niall Ferguson says * We need a second stimulus, Galbraith says

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Barry Ritholtz is Yahoo Tech Ticker’s Guest of the Year

On March 10, Barry Ritholtz, CEO of Fusion IQ, came on Tech Ticker and said the “mother of all bear market rallies” was upon us.Given the appearance was within 24 hours of what proved to be a historical market bottom, that call alone would have put Ritholtz in the running as our top guest of 2009 and winner of the coveted (and fictitious) “Purple Microphone” award. Ritholtz’s call was more notable because, until then, he’d been steadfastly bearish on the market, meaning he was one of the few pundits to successfully navigate the downturn of 2008 and play the upside of 2009.But unlike many other bears who turned bullish last spring, Ritholtz didn’t abandon bullishness as the rally continued through the rest of 2009: * In May he said: Don’t Call It a Suckers Rally * In mid-September he said: The Rally May Only Be in 6th or 7th Inning * And as of last week, he was still saying you have to give the rally the benefit of the doubt, suggesting the S&P could hit 1300 before faltering. While other Tech Ticker guests were bullish on stocks in 2009, many did so because they believed a V-shaped recovery was afoot and that the housing market had bottomed. Ritholtz was able to walk the intellectual tightrope between being bullish on stocks and being skeptical about a robust recovery, especially in housing. As 2009 comes to a close, both calls are looking prescient.Still, nobody’s perfect. In mid-June, Ritholtz dismissed the “second-half recovery” story and said stocks were more apt to retest the March lows in the fall vs. hit new high, although he subsequently reverted back to the bullish (and right) side.

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Howard Davidowitz is Yahoo Tech Ticker’s Best of 2009: Fan Favorite

Tech Ticker conducted hundreds of interviews this year with dozens of guests on numerous topics. But one guest consistently garnered massive amounts of excitement and (for the most part) positive reaction from you, the audience.Without question, Howard Davidowitz of Davidowitz & Associates is the audience’s favorite guest of the year.Davidowitz is a straight shooter who always tells it like he sees it. Whether it’s his bearish predictions on the economy or his criticism of the government’s bailouts, Davidowitz is always an impassioned observer. His ‘end of the world’ forecasts haven’t exactly panned out, but what he lacks in fortune telling skills he makes up for in entertainment value.Editing the ‘Best of’ clips was not easy but it sure was fun.Hope you enjoy his appearance as much as I do.

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Good Riddance to this Past Decade

Though it ended badly for some (i.e., Lehman Brothers, Bear Stearns and the U.S. taxpayer), the first decade of the new millennium ushered in a new Gilded Age on Wall Street. The last 10 years saw the rise of hedge funds, $100 million bonuses and bundles of billionaires from as near as Park Avenue and as distant as Siberia.Unfortunately, for the average American investor it was “deca horribilis,” to paraphrase the Queen of England.Overall, the last 10 years were the worst on record for U.S. stocks, dating all the way back to 1820s. Stocks on the New York Stock Exchange fell on average 0.5% annually. The S&P 500 was even worse, losing an average of 3.3% a year. And the Nasdaq, after eclipsing 5,000 in the first quarter of 2000, lost about half its value throughout the decade.This secular bear market was especially cruel to many retail investors, who came to expect 10% annual returns after the raging bull markets of 1980s and 1990s when stocks rose on average 16.6% and 17.6%, respectively.Yet, it wasn’t a total loss. Commodity investors made a fortune. Gold rose more than 15% per year and oil prices, though extremely volatile, proved to be a brilliant bet.And, let’s not forget the emerging markets. Many of the best performing stock markets over the last 10 years hail from the former Soviet Union. Russian stocks are up more than 700% and the Ukraine has gained more than 900%. Hong Kong’s Hang Seng Index, which has benefited from the rise of China, is up 545%.History suggests another bull market for U.S. stocks is coming and the ‘10s will likely be better than ‘00s. There have never been two consecutive decades of negative returns in U.S. stocks. Unfortunately, as Tom Petty once said, “the waiting is the hardest part.”

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Drug Cartel Violence in Mexico

The United States and Mexico face systemic challenges in efforts to secure their shared border from drug cartel violence. In Part 1 of a special report, STRATFOR examines the geographic and political issues that weaken Mexico’s central government and contribute to the strength of the cartels.

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Howard Davidowitz Sees Our Future And It Is Japan – We have 2 Decades of Recession

Many economists draw comparisons between the United States now and Japan in 1990.For those who aren’t familiar with Japan’s recent economic history, this is not a good thing. Japan’s stock market peaked in 1989 at about 40,000. It now trades around a quarter of that level, or 10,000. GDP, meanwhile, has barely grown at all.Economists used to refer to Japan’s malaise as “a lost decade.” Now they’re saying “lost decades.”Our guest Howard Davidowitz sees a similarly horrific future in store for the U.S. He calls America’s current path, rich in deficit spending and weak in currency a “road to nowhere.”He also doesn’t buy the arguments of those who reassure us that Japan’s problems are “cultural” and “demographic”–and, therefore, that it’s different here. Japan’s problems are the same as our problems (artificially low interest rates and a bailout culture), Davidowitz says. The only difference is that we’re about 20 years earlier into the collapse.If we are Japan, what is the outlook for the stock market (and your retirement savings)? Not good.If the DOW behaves the way Japan’s NIKKEI has, the DOW will trade at about 4,000 in 2025.

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Howard Davidowitz Says, What Recovery? U.S. Consumers Getting Dramatically Worse

According to the National Retail Federation, retail sales over the Thanksgiving holiday weekend were $41.2 billion, up slightly from a year ago, while about 195 million consumers shopped, up from 172 million last year.Meanwhile, Coremetrics says the average online shopper spent 35% more on Black Friday vs. a year ago, while robust sales were predicted for Cyber Monday.Against that backdrop, you might expect Howard Davidowitz of Davidowitz & Associates to backtrack from some of the bearishness he’s professed on Tech Ticker (and elsewhere) in the past year. But you’d be wrong.”The consumer is in worse shape since I was here last” in August, Davidowitz says, citing the following: * Unemployment has exploded: “We’ve lost a ton of jobs since I was here last,” Davidowitz says, noting the “real” unemployment rate is 17.5%. “That’s an astounding number.” * Housing continues to sink: “The consumers’ biggest asset is down trillions” in value while “foreclosures are exploding” and a huge percentage have negative equity — 23% according to CoreLogic. * Record numbers of consumer bankruptcies: The American consumer has “never been further behind…never defaulted more” on mortgages, student loans, auto loans, and credit card bills, he says. * Poverty on the Rise: One in eight Americans and one in four children are receiving food stamps, as The NYT reported this weekend.”A lot of people were out on Black Friday — you’re always going to spend some money because it’s Christmas,” he says. “[But] the consumer continues to get dramatically worse.”Davidowitz predicts “the noise will be taken out” about “strong” Black Friday sales in the coming weeks and a sobering reality will settle in: “People will look a stores closing and a rash of bankruptcies after Christmas. People will start to look at this and say ‘wow, this is terrible,'” he says.

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