Friday, August 14, 2009

US Stocks Close Lower As Consumer Companies Pace Slide

Some of the more economically sensitive sectors and companies, including consumer company Nordstrom, energy giant National Oilwell Varco and industrial Boeing, paced a stock market decline Friday.

Still, traders noted was activity was particularly light during the session, as is typical for a Friday in August. Volume had been relatively high in the last few weeks on the flood of corporate quarterly reports, but had slowed down in the last two days. For Friday, NYSE Composite volume was about 5.1 billion shares, compared with average volume of about 6 billion this year.

"It's safe to say that after the Fed meeting, a lot of people took the rest of the week off," said Richard Gatto, an equities and derivatives trader with Meridian Equity Partners. (more)

Gerald Celente: The “Second American Revolution” Has Begun

The natives are restless. The third shot of the “Second American Revolution” has been fired. History is being made. But just as with the first two shots, the third shot is not being heard.

America is seething. Not since the Civil War has anything like this happened. But the protests are either being intentionally downplayed or ignorantly misinterpreted.

The first shot was fired on April 15, 2009. Over 700 anti-tax rallies and “Tea Parties” erupted nationwide. Rather than acknowledge their significance, the general media either ignored or ridiculed both protests and protestors, playing on “tea bagging” for its sexual innuendo.

Initially President Obama said he was unaware of the tea parties. The White House later warned they could “mutate” into something “unhealthy.” (more)

Smart Money - September 2009

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There is No Recession, This is Planned Financial Demolition

Credit is not flowing. In fact, credit is contracting. That means things aren't getting better; they're getting worse. When credit contracts in a consumer-driven economy, bad things happen. Business investment drops, unemployment soars, earnings plunge, and GDP shrinks. The Fed has spent more than a trillion dollars trying to get consumers to start borrowing again, but without success. The country's credit engines are grinding to a halt.
Bernanke has increased excess reserves in the banking system by $800 billion, but lending is still slow. The banks are hoarding capital in order to deal with the losses from toxic assets, non performing loans, and a $3.5 trillion commercial real estate bubble that's following housing into the toilet. That's why the rate of bank failures is accelerating. 2010 will be even worse; the list is growing. It's a bloodbath.

The standards for conventional loans have gotten tougher while the pool of qualified credit-worthy borrowers has shrunk. That means less credit flowing into the system. The shadow banking system has been hobbled by the freeze in securitization and only provides a trifling portion of the credit needed to grow the economy. Bernanke's initiatives haven't made a bit of difference. Credit continues to shrivel. (more)

Consumers not feeling a recovery

Two key reports Thursday showed one thing: happy days are not here again for American consumers.

Retail sales fell in July after two straight months of gains, the government reported Thursday, a drop that surprised economists. Without car sales from the "Cash for Clunkers," the numbers would have been even worse.

And Wal-Mart (WMT, Fortune 500), the world's largest retailer, reported an unexpected decline in its key measure of U.S. sales.

"From a consumer finance position, people are still struggling," said Scott Hoyt, senior director of consumer economics for Moody's "Wages have fallen from the previous year and consumers don't [still] have alternative sources of cash." (more)


The nation quickly descending into chaos

A very dangerous thing occurred last Thursday and Friday. The Federal Reserve monetized roughly 40% of the nation's enormous debt. This means that the Fed printed money to flow into the economy in order to cover over 40% of the debt burden the U.S. now carries.

Within days the U.S. government quickly sold off this portion of the debt, creating even more debt, leading Treasury Secretary Timothy Geithner to request from Congress a lifting of the debt ceiling so that we could cover our obligations. That, of course, will create even more debt.

This economic shop talk may sound like gobbledygook to most average citizens, like myself. But the bottom line is that what the Fed did last week will create what is known as 'hyper-inflation.' The cost of goods and services rises so fast that average citizens can't afford the basic essentials of living. (more)

Pressure (Countdown) Toward Breakdown

......The Paradigm Shift continues to displace the power centers and introduce new ones. Those bright souls who ignore the shift will be well prepared for systems that soon do not stand. The Americans are the last to know, oblivious to the global shift in progress. They continue to seek a return to normalcy, when old conditions are as gone as a baby’s innocence during teen years. The crux of the matter is that the United States is no longer in control of its fate. Meetings with creditor nation leaders result in new orders given, and new policy directives enacted. Comparisons are made to China, but they too are a distraction. China can embark on its own path, can stimulate with huge sums of money, since they have actual savings. The US has massive debts, as insolvency has infiltrated to destroy systems pertaining to banking, home mortgages, federal operations, and industry. The nation is as hollowed out as its leaders are compromised. The major theme of this decade is USGovt leaders working hidden agendas. To be sure, tremendous stress is at work within USGovt agencies, ministries, and elsewhere. My focus is primarily on the financial impacts, never to be swayed by official stories and pronouncements. (more)

Americans working much harder – for less pay

Feel like you’re working a lot harder these days, putting in longer hours for the same pay — or even less? The latest round of government data on worker productivity indicates that you probably are.

The Labor Department said Tuesday that the American work force produced, at an annual rate, 6.4 percent more of the goods they made and services they provided in the second quarter of this year compared to a year ago. At the same time, “unit labor costs” — the amount employers paid for all that extra work — fell by 5.8 percent. The jump in productivity was higher than expected; the cut in labor costs more than double expectations.

That is, despite the deep job cuts of the past year, workers who remain on the payroll are filling in and making up the work that had been done by their departed colleagues. In some cases, that extra work came with a smaller paycheck. (more)

The Big Picture: An Economic Forecast for Coming Times (Interview with George Green)

George Green
George Green

eorge Green is a former investment banker (Registered Financial Principal with the N.A.S.D. and a Broker/Dealer, Securities Underwriter, Real Estate Developer, Insurance Broker and Publisher, who was invited into the power elite. Faced with a moral and ethical dilemma, he turned his back on his former associates to walk an entirely different path.

In the first of our two interviews with George, we discuss the financial and economic times ahead in 2007 and beyond. You may not agree with his outlook but this is information that comes with more than a sprinkle of inside information so it might be worth listening to be prepared.

George has published several books and is offering all our viewers a free downloadable copy of his book 'Handbook for a New Paradigm' - all you have to do is click here or below to get the inside scoop.

Watch the video here

Faber: Central Banks Blowing Huge New Bubble

Investing guru and publisher of the Gloom, Boom and Doom Report Marc Faber remains a bear, predicting a stronger dollar, tightening in global liquidity and another correction in asset prices.

When the S&P bottomed in March, the dollar was weak, notes Faber, who expects the next few months will be a period of dollar recovery and “a correction time in asset markets” as the dollar strengthens.

“The strong dollar means global liquidity tightening,” Faber told CNBC.

“In a scenario where growth will be disappointing, I think emerging markets will be kind of vulnerable.”

The worse the global economy, the more stocks could go up, Faber says, because the world’s central bankers have become nothing more than money printers. (more)

Is Goldman Sachs Evil?