Important News - Oct. 15 update 1
By Daniel at 15 October, 2009, 11:29 am
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1) Foreclosures: ‘Worst three months of all time’
Despite signs of broader economic recovery, number of foreclosure filings hit a record high in the third quarter - a sign the plague is still spreading.
2) Capital One credit card defaults rise in September
In a regulatory filing on Thursday, Capital One said the annualized net charge-off rate — debts the company believes it will never collect — for U.S. credit cards had risen to 9.77 percent in September from 9.32 percent in August.
3) Companies Aren’t Using Borrowing to Spend
One of the biggest questions facing the U.S. economy is when businesses will feel confident enough to do the kind of investment and hiring that could sustain a recovery. If you believe the reasons they list when they borrow money, the outlook isn’t too good.
In the first nine months of 2009, companies around the world borrowed about $2.3 trillion by issuing investment-grade corporate bonds — more than in any entire year on record, according to data provider Dealogic. When they issue the bonds, they typically tell investors why they’re doing it, valuable information that Dealogic records.
4) Commentary: It’s time for the banks to pay
“The holes in the banks’ balance sheets are probably much bigger than most of the estimates made by official institutions. This is why the belief that the massive capital injections to US banks would be translated to more credit for the real market turned out to be false. The banks needed all this money just to fill up the holes in their balances, and nobody can really tell if this was enough. ”
5) When Money Is Worthless (Claire H.)
The Financial Times on October 6 noted a disturbing new trend - hedge fund and other investors are increasingly seeking to invest in physical commodities themselves, rather than in futures. Given the excess of global liquidity, this is not entirely surprising. It does, however, raise an ominous possibility of a supply shortage in one or more commodities, caused by investor demand that exceeds available mine output and inventory. That could potentially produce a collapse in economic activity similar to that from the 1837-41 and 1929-33 liquidity busts, but with the opposite cause.
6) TIPS: Fed mortgages future of great-grandkids, Dorothy and now, Toto too (Claire H.)
BlackRock Inc., Pacific Investment Management Co. and Vanguard Group Inc., which together manage $3.45 trillion, say investors are pouring money into inflation-linked debt even as consumer prices post the longest series of contractions since Dwight D. Eisenhower was president in 1955.
7) Ponzi Finance (Douglas A.)
This is an excerpt from a letter I got from Mauldin. He reprinted this quarterly report from the Quarterly Outlook from Hoisington Investment Management. The inflation outlook from the monetary and fiscal standpoint looks truly deflationary, yet some believe that dollar weakness will reverse this circumstance and create inflation. This is unlikely.
Unfortunately, It’s Screw the Shareholders! (David M.)
“Unfortunately it’s screw the shareholders!!” Charles K. Gifford wrote to a fellow director in an e-mail exchange that took place during the call. “No trail,” Thomas May, that director, reminded him, an apparent reference to the inadvisability of leaving an e-mail thread of their conversation. The e-mail messages, reviewed by The New York Times, were handed over to the House Committee on Oversight and Government Reform this week as Bank of America opened a collection of documents that it has kept secret about the ill-fated merger.
9) 2012 forecast: Food riots, ghost malls, mob rule, terror
Trends chief says people should brace for ‘the greatest depression’
10) From the London Independent , Demise of the Dollar ;
” Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars.”
” The plans, confirmed to The Independent by both Gulf Arab and Chinese banking sources in Hong Kong, may help to explain the sudden rise in gold prices, but it also augurs an extraordinary transition from dollar markets within nine years. ”
11) Why is Wall Street Rallying , Paying Banker / Fascists Bonuses Generated from Laid Off Taxpayers ?
” We should not be sentimental for the dollar. It makes economic sense for world trade to be conducted in a variety of currencies. Relying on one only has the advantage of clarity, but it also creates instability if the economy that underpins it faces uncertain prospects”.
12) Investors Favored Bond Funds as Dow Average Rallied Past 10,000
“A net $254.6 billion was added to bond funds during the first nine months of 2009, compared with $14.5 billion for stock managers, according to Chicago-based Morningstar. Almost $3.45 trillion remains in U.S. money-market accounts, data from Washington-based Investment Company Institute show.”
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