The new economic storm could start as early as February.
By Daniel at 31 January, 2010, 11:55 pm
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each individual event will have no visible effect, but combined will crash the economy:
these are all pending events, many listed on MW as individual events, but no one looks at them all together - but that is how we will feel them in our wallets
financial:
- the next wave of ARMs will start to reset, Alt-A and Option ARMS resets to begin in March 2010.
- mortgage rates will go up, After Record Lows, Mortgage Rates Headed Up in 2010
- the next wave of foreclosures will hit, Fannie Mae, Freddie Mac delinquencies rise
- the default on holiday expenditures will cause more chapter 7 and 13 filings,
- retailers will know how little they made, and many will go chapter 11, or just close
- With $300B of delinquent loans, Fannie (FNM) and Freddie (FRE) are checking files for underwriting flaws and forcing banks to repurchase those loans.
taxes:
- the fed will start seeing how little revenue they got from business because of COBRA extensions and funding, and push for new taxes
- states will start locking in on the lower incomes from wage taxes, and looking to raise taxes,
employment
- Euro-zone unemployment hits 10%
- employer hiring will slow even more, as the employer tax mandates for health care kick in
- employers will see the new unemployment tax rates which will come due, and lay off or not hire to be able to meet those expenses
- seasonal job losses will be posted as the holiday labor surge ends
- this also be when the numbers are issued for the “new” unemployment extension enrollment and it will “true” the unemployed picture,
- ‘Underemployment’ Tops 20% In 3 States ‘
health reform effect:
- consumers will see the effect of the new FICA rates and cut spending even more
- the 40% luxury tax on those fine health plans will kick in, and families will see a 20 - 30 % drop in disposable income
- the insurance companies will pass on the taxes they have under the new health bill, and that will cut another 5 - 10% off of each person’s disposable income
- the manufacturers of medical products (tampons, bandages, medical wipes, chairs etc) will pass on the tax they were given, further affecting disposable income
- the Fed will have published the health bill details - and states will see how much they will have to pay, forcing tax increases
- insurance company rates will climb as a result of the new health plan taxes, effective immediately
banking:
- FDIC will collect next 3 years worth of fees to cover the depleted funds from the bank failures
- banks will tighten lending even more, as they scramble to meet the FDIC “tax”,
- 10% of banks will become financially unstable because of the depleted reserves and will be taken over by the newly funded FDIC
- US banks face risks, could spark downgrades -S&P
- Greece, Portugal Debt Concerns Start to Infect Companies, Banks
Inflation fear raised, Countries forced to tighten up
- China, Taiwan keep tightening, fearing asset bubbles
- India RBI begins tightening cycle, ups banks’ reserve ratio
- Fed Lays Ground for End to Stimulus With Recovery Declaration
- China: Rates already went up!!!
Sovereign Debt Crisis Expands
- the Greek (and Euro) financial crisis is worsening
- Greek Debt Swap Counterparty Risk May ‘Spook’ Market
- Funds Flee Greece as Germany Warns Of “Fatal” Eurozone Crisis
- Spain Goes On Offensive, Cuts Everything To Combat Debt Crisis
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