Saturday, May 16, 2009

Trampled Green Shoots

I like lists of things. Here is one from Jim Willie...

2009-05-15: Trampled Green Shoots
What follows is a laundry list that puts the USEconomy halfway between the Intensive Care Ward and the National Morgue:

  • Endless War spending could subsidize every household in America with $1000 per year
  • Income is trending down in the United States, England, and Japan
  • US banks loan loss reserves are at a 20-year low while profound losses continue
  • Of the nearly 9000 US banks, 1575 of them posted a Q1 loss
  • Bernanke claims $2 trillion is needed by the big US banks, but they pass the Stress Test
  • Municipal bonds and state finances are disasters, as they each appeal for USGovt aid
  • A shocking 20% of US homeowners have loan balances greater than their home values
  • Half of modified loans result in foreclosure within several months
  • Jobs report for April revealed jobless level at 8.9% (massaged) and 15.8% (actual)
  • Jobs Report for April included 66k worse revised job losses for March and February
  • Continuing jobless claims at 6.56 million, grew 220k just last week
  • CALPERS pension fund is insolvent, USGovt pension PBGC guarantee fund in deep deficit
  • FDIC requested $500 billion in additional funds to cover bank failures (giant failure coming)
  • Car sales still down 40% annually, with steep Japanese car sales declines also
  • Detroit carmakers are closing down plants, with huge ripples through entire supply chain
  • GM & Chrysler restructures are extremely likely to result in Chapter 7 liquidation in time
  • GM burned $1.3B in Q1, burns $113 million per day, unable to transition to green cars
  • Business investment down 38% in Q1, a RELIABLE LEADING INDICATOR
  • Durable goods up 9% in Q1, but only after Q4 was pushed down from bank shock
  • Inventory reduction not key, but rather inventory/sales ratio, since sales way down
  • Economic contraction despite lower energy costs from crude oil, natural gas, gasoline
  • Housing was false foundation since 2002, now in stubborn decline, the Giant Albatross
  • Distress sales make up 40% of all housing sales, led by underwater sales and foreclosures
  • Cramdown Law rejection means open season on foreclosures, more huge bank losses
  • Banks admit that home loan are not modified after all, a revolving door to foreclosure
  • Option ARMs, Jumbos, and Commercial mortgage defaults are ramping up fast
  • Commercial mortgage bonds have $70-100 billion that cannot be refinanced, sure to default
  • Staggering decline in consumer credit, -80% in Q3, minus $31.7B in Q4/Q1

No comments: