US hell bent reliving 940's-50's--the importance of new homes, prices need to increase to create the illusion of prosperity at the expense of the value of the dollar, masked by the dollar role as cream of the #$%$ paper currencies.
But here's a thought I hadn't represented well in past. I cynically couched the illegal legal immigrant "thing" as the major substitute for the under 40's avoiding parenthood, along with boomer longevity, holding up the real estate bubble.--
It's really is-- and why the urgency of immigrant legislation, and that has made the under 40 crowd, get this now, LARGER by 10% the baby boom generation. +TEN PERCENT and growing.
That changes things demonstrably, there is opportunity for real estate growth past the the foreclosure overhang. Keep watching that space.
Next week we bottom out on the Bennie bond blast and bounce. GLTA
Jun 25 8:30 AM Durable Orders May - 4.5% 3.0% 3.5% 3.3%
Jun 25 8:30 AM Durable Goods -ex transportation May - -0.6% -0.5% 1.5% 1.3%
Jun 25 9:00 AM Case-Shiller 20-city Index Apr - 10.5% 10.5% 10.9% -
Jun 25 9:00 AM FHFA Housing Price Index Apr - NA NA 1.3% -
Jun 25 10:00 AM Consumer Confidence Jun - 72.0 74.9 76.2 -
Jun 25 10:00 AM New Home Sales May - 470K 460K 454K -
Jun 26 7:00 AM MBA Mortgage Index 06/22 - NA NA -3.3% -
Jun 26 8:30 AM GDP - Third Estimate Q1 - 2.4% 2.4% 2.4% -
Jun 26 8:30 AM GDP Deflator - Third Estimate Q1 - 1.1% 1.1% 1.1% -
Jun 26 10:30 AM Crude Inventories 06/22 - NA NA 0.313M -
Jun 27 8:30 AM Initial Claims 06/22 - 345K 345K 354K -
Jun 27 8:30 AM Continuing Claims 06/15 - 2975K 2958K 2951K -
Jun 27 8:30 AM Personal Income May - 0.1% 0.2% 0.0% -
Jun 27 8:30 AM Personal Spending May - 0.4% 0.4% 0.2% -
Jun 27 8:30 AM PCE Prices - Core May - 0.2% 0.1% 0.0% -
Jun 27 10:00 AM Pending Home Sales May - 1.5% 1.5% 0.3% -
Jun 27 10:30 AM Natural Gas Inventories 06/22 - NA NA 91 bcf -
Jun 28 9:45 AM Chicago PMI Jun - 52.0 55.5 58.7 -
Jun 28 9:55 AM Michigan Sentiment - Final Jun - 81.0 82.6 82.
Claims declined a non event statistical blip, but the market assumed over 300K an issue for Bent Bernorkle to keep buying bonds, and the whole market is off to bubble land. SLW took off like a stock immaterial the price of silver, and that has me very nervous. This is not going to be fun about four weeks out from the next meeting of the Fed where they FOMC at the mouth about stopping bond buying, which makes mortgage rates go up because the bonds lose demand and go down. Higher interest, less interest in silver as safe haven, let alone gold, and the dollar improves, and PM?--we're off on a virulent, not virtuous cycle. This could get very overdone on the downside very early, YDM said the next 350 basis points the rise in overnight rates would come out of your pockets about the time mortgage rates popped a quarter to a half point, hey kids, we're there.
That doesn't mean these three days of market irrational exuberance won't be followed by many more, it's just we're really in no man's land. The wall of worry used to be the great wall of China, it still is, China's crumbling and the cracks suspected all along are starting to show.
Most of the US is still mired in real estate hell, especially the East/NE part of the US--California may be back to 2006 prices, but they're not representative of the rest of the country (in many many ways). Britain is entering its second recession, about the only respite over here is for those with adjustable mortgage rates dependent on libor London rates, looks like those have about three years to run at rock bottom.
But silver and gold and the miners and the miner banker? I am waiting for the turn to go long, and if I miss the bottom so be it.
Good eco is bad, and bad is good, the economy is addicted to the appearance of stimulatum excretatum. Claims better come in lousy to give the market the poparoonie, and even silver's dead cat has another electric prod up its a.........s........s.... this morning in the wee hours. It's up a whopping one percent after a 6% debacle I don't need to mention and SLW is at its April 2010 price.
Silver is strictly playing its currency side, it becomes problematic to SLW if it sinks below $9 an ounce. If it gets to $12 SLW will see single digits. Breakeven for SLW is $9.50, and the last deal the new administration made was no bargain.
Silver should be about $25 an ounce compared to the 1973 price. Deflation followers have discounted the metal by 30%. These bargain prices should be stabilizing, but many said $22 was the bottom.
YDM said three years ago, if irates popped the market would discount the entire rise to 5.75% mortgage rates in months--not waiting, anticipating.
The market most affected by that eventuality, thanks to Ben wrong way Bernanke, is silver and gold.
YDM nailed home numbers boosting the market after the market misread Fed "support" for Bernanke tightening and China waffling about "seasonal volatility" as if that supported loose money--it doesn't. Just the opposite. Tomorrow the blood bath follows today's dead cat bounce, and silver is already taking another 40 cents haircut early evening hours.
I smell about two percent off the top of the market by the end of the week. Silver is oversold at anything less than 10X 1973 prices. BUT--that's $2.54--it should be $25.40 cents.
Is this a place to start nibbling? Mebbe--but it sure is a place to start studying.
Housing and sentiment, not a couple Fed statements about overcooked markets overreacting to tapering, will rule the opening bell. At best, a stack of Fed Chairman saying don't worry be happy is all that stands between status quo pullback and stagnation--who'll be brave enough to follow Bernanke henchmen over the Wizard of Bonds? Institutions? Joeretail?
Where's the teeth inside any reflex rally? I think there is another 7.5% downside coming as long as good news is bad (earlier tapering) and bad news is bad (struggling economy). It's head's you lose, tails you lose.
A flat day would be a victory.
No US eco news is not good news, the Chinese seem to be having conniptions about increasing "liquidity" selling to Walmart--and the market is in the tschittter. SLW off as much as 7%.
I'm bleeding through newly developed orifices.
The IMF isn't in a bond buying mood Sunday morning, which leads one to believe the world wide conspiracy to keep rates low suddenly isn't popular anymore. I can't explain it with common sense and logic, just popularity. We now squander the time of low "inflation" with high interest rates, leading to less money for joesixpac to spend on whammy games on the internet, and the whole economy to trough back to the toilet.
Bennie hasn't been right yet on the major turns, just the handling of the steering wheel of the economy, and now it's hands off and the market is wallowing side to side in wider circles till it derails. That's why the general investment public, mostly institutions, is diving out the back door.
We've five to ten percent to go down before it settles, as the market is keen on taking the four percent rate and discounting it now to 5.75%.
YDM was right.
At one time just a couple of years ago the "undocumented" residents in this country were estimated to be 20 million. Unfortunately, with the economic downturn, many of those illegals returned to their motherland, Mexico. Perhaps 15 million remain...most of which may be hard workers but are under educated. So if those 15 million attain citizenship with any proposed congressional legislation, what is the chance that most of these minimum wage workers with substantial family numbers will actually pay taxes. Most of them will not. They will not earn enough. In fact, most will qualify for subsidized government services that must be funded by those more fortunate....that earn enough to pay taxes....mostly the middle class (a shrinking breed).
Undocumented workers are human beings like the rest of us and deserve the dignity of trying to make their way in the world. And how can any country round up 15 million humans and escort them to a border. But if these new residents are granted legal status in this country, I can't help but believe there will be an incredible increase of taxpayer spending to support the needs of this economically underclass (a term not intended to disparage Hispanics).
Unfunded liabilities are forever growing. Just like Medicare with it's promise to provide tax revenue based medical benefits to seniors as well as the Bush enacted Prescription Drug benefits, Obamacare's true cost to taxpayers is yet to be calculated and added to the rest of the growing unfunded liability cancers. So just imagine the added expense of providing public subsidies to another 15 million new citizens hanging out on the lower rungs of the economic ladder.
Something tells me the expense side of the Federal ledger is about to accelerate way faster than the revenue side. And how does government expect to pay for these services? Just add a printing press or two.
Got silver? Got gold?
“…I can't help but believe there will be an incredible increase of taxpayer spending to support the needs of this economical underclass (a term not intended to disparage Hispanics). …”
Are many of you forgetting that persons legally residing in the country are fast becoming THE “underclass”?
Why should this country provide a better life for those who came here illegally from Mexico or any other country? If they came here illegally to better their lives, and in all probability have, are you forgetting that Americans that came before us gave up a great deal, including their lives and fortunes, such as the signers of the Declaration of Independence.
Aren’t those who came here illegally shirking their responsibilities to correct the conditions that led them to take the easy route and come here? Of course that is the objective of the One Worlders, to destroy the United States in their quest for power by encouraging a growing “underclass” that they will have dominion over.
The solution is simple, were it not for what has become the corrupt nature of the nation’s Federal Government. It’s all about cheap labor provided by illegal immigrants, which is against the law even though eVerify (not mandatory) is in place to discover whether job applicants are here legally. Employers have long fought successfully to bribe politicians to prevent any real sanctions against them for hiring illegal aliens, opting instead to increase the chances that legal citizens/residents would end up on the welfare rolls, thus calling legal job seekers “lazy” or any other pejorative that justifies the position of employers to reduce labor costs.
Rather than feel sorry for illegal aliens they need to return to their homelands and foment revolutions that will bring their expectations for a better life in line to what the Founders of this country hoped for when they wrote the Declaration of Independence. Are you afraid they might die in the process? What about those who fought and died for the USA?
as for all the home sales being reported,about 80% of them are Investment Co's, buying them for rental purposes. And when a bank forecloses on a home, it is COUNTED as a SALE. We live in the U.S. of L (lies)
DEADMEAT,are you still holding SLW? HAVE YOU LOOKED AT the 5-yr. chart and noted the monster head-and shoulder pattern? We are not far from the 5-yr. low.
All those Gov't statistics dog-doo-doo. All lies. If they help you make a buck,then fine.
But I just believe in the charts as my aide.
What good is any type of tech. analysis when the Fed is active ? Everything is just so crazy now. Think Ill have to keep things in cash as much as I hate too. Maybe invest in Smith & Wesson stock as gun making should do well.. Cant think of anything else with any safety ..