PALOOKAVILLE FINANCIAL stardate : capitulation day+73
...monday mornin here in palookaville and it aint lookin good...
opkin : yo painty!...how come yo aint been postin no stuff much lately?
perplexedly : shucks...mousey dude!..ahm lost man...evva thang gone pear shape innit!...
merryn : ..."Look at the speed at which the high street is going bankrupt; at the huge rises in unemployment; at the ongoing contraction of credit; the collapse of sterling (which suggests the rest of the world isn’t too optimistic about the UK); at the house price crash; and at the falls in consumer confidence.
Then ask a small business owner how he feels. According the Tenon Forum, more than 70 per cent of owners say that the recession has had a negative effect on their business and 26 per cent have cut staff as a result. Only 53 per cent feel positive – down from 86 per cent a year ago. Add it all up, and deflation combined with a long recession looks to be more than just a passing threat to be dealt with by chucking £60 at the odd pensioner.
Finance ministers and central bankers around the world know this. Hence the state bailouts, the frantic cutting of interest rates, the huge rises in public spending and the talk of tax cuts. They’re all aimed, not so much at helping “hard working families” in the short term, but at preventing long-term Japan- style deflationary recession.
For now, none of these measures is likely to make the slightest bit of difference: the scale of the deleveraging of the economy is just too huge. That means sensible investors should still be steering well clear of all risk. So no new exposure to much in the way of equities, holiday villas in Estonia or commercial property – regardless of the bear market rallies that are doubtless on the way (the run-up to Christmas is usually good for equities and it is easy, if slightly wrong-headed, to argue that they are cheap).
Instead, stick with gilts in anticipation of further big falls in interest rates. It might seem that all the misery the world could face is priced in but, in the UK, there is still 3 per cent to go before rates hit zero. We may well get there. more FT
zooneh : whahoppen ta a rally man?
armageddony : " 'Gone, Over, Toast.'
It's interesting how short-sighted many so-called experts are when it comes to understanding the pace and path of forces swirling through the economy.
Even when it was apparent to everyone that the bubble had burst in housing, for example, some forecasters were predicting that municipal finances would not be seriously affected.
Aside from wishful thinking, one reason for the cognitive dissonance appeared to stem from the fact that people were not getting immediate reports from state and local officials that budgets were being wracked by falling revenues and rising costs.
Yet that should not have been a surprise to anyone. There are in-built delays, such as the time it takes to build a house or the grace period allowed for tax receipts to be remitted to authorities, that would postpone the moment of reckoning for months -- or longer.
The same holds true in terms of the state of the overall economy. The optimists seem to be saying that since today's data are not so bad, fears about a serious downturn are overblown.
As it happens...
Charles Hugh Smith : ..."Breadlines didn't form in November 1929--the structural damage took years to play out then, and it will take years to play out now. So don't rush things, Peggy--we'll get to a visible Depression soon enough..."The Coming Great Depression: Leaving Fantasyland."
petey : evvaboddy know they aint no sanity clause...
beulah : well if n thats all ya gotta say...bellyachin an stuff...i wish ya had stayed...
...shut up an dumb...
...stupid painty git don know is ass fromma el;bow...innit!