Unemployment Hits 8.1%

Friday, March 6, 2009

Submitted without comment.

From CNBC:

U.S. employers axed 651,000 jobs in February, pushing the unemployment rate to its highest in 25 years, as companies buckled under the strain of a recession that is showing no signs of ending, according to a government report.

“Since the recession began, the rise in unemployment has been concentrated among people who lost jobs, as opposed to job leavers or people joining the labor force,” said Bureau of Labor Statistics Commissioner Keith Hall


GDP Dropped 6.2% in Q4

Friday, February 27, 2009

Ouch.

Who wants to take a swing at Q1?

Previously, I said a 6% drop. Do I hear 10%?


Buy Now

Sunday, February 22, 2009

Ok, I hesitate to write this one because I believe that the economy is still heading down and we are on the verge of a global depression.

But…

The stock market has just reached near its 10-year low and I believe this mark is roughly the floor. That is not to say that the market won’t test this bottom again and that we are going to have years of, on average, a flat return.

But…

I’m going to buy now.

There are global stimulus efforts afoot, which will create a temporary boost, and there will be opportunities for both active trading gains and, if you’ve got thirty or forty years, tremendous long-term returns.

This is a dark moment. Maybe the darkest yet.

But…

That’s the time to buy. Just don’t do it if you need the money soon and/or can’t stomach the roller coaster. I also warn you that I, like everyone else, have no idea what’s going to happen. I’m going on gut and a sense that you stay calm when everyone else is panicking.

Remember, Cassandra was right.

In this case, I’m just betting – and it is a bet – that I can make money while she screams.


Punishing Wall Street

Tuesday, February 3, 2009

You may have noticed a slightly angry tone on this blog in recent days.

I can’t help it. I’m furious.

It’s not just that Wall Street greed (in the most negative, irresponsible sense) has catapulted the world into a depression (if it’s not here yet, it’s coming), it’s that there has been, to date, no repercussions. A few CEOs have stepped down. A few executives have missed bonuses.

But these actions should be expected when companies post losses of billions of dollars. Anyone (in my mind, this is not debatable) can manage in the boom times, but if your company collapses in the bad times, you are a bad manager and should be fired (and certainly receive no bonus or golden parachute).

No. What bothers me is that Congress somehow thinks they can get away with holding a few hearings. Obama thinks he can get away with a scolding. Cuomo thinks he can get away with a few threats and withheld bonuses.

But that is not enough. There must be serious, lesson-teaching punitive measures meted out to Wall Street. Many must go to jail. Lavish pay must be curbed. Bankers must lose their homes and wives. Their children must be forced to attend public school.

And it must happen on, in relative terms, a Maoist scale. Thousands must pay the price.

The reason for this is simple: They must pay because they are the architects of global suffering on a level that hasn’t been seen in a century (or longer).

Two more arguments:

a) gains are illusory – what I had two years ago, I no longer have – but bonuses are real.
b) bankers were paid obscenely when times were good and should suffer in inverse proportion when times are bad.

The bottom line is that it is truly an age of privatized profit and socialized losses, with “top talent” making out like bandits.

The reason why a man like Captain Sullenberger is such a champion to the people is because he is a man of ethics; a man of honor and responsibility who understood that his duty extended beyond the self.

Is there any banker in the world about whom we can say that?

In another age, these men (and a few women) would be strung up in the public square and burned.

Then the point, in many cases, was to allay a restive public; to give the people a show of blood and vengeance. We live in a more civilized age, but the need for catharsis lives on and grows stronger now.

The people want blood.

I want blood.

Who (and how many) will pay the harsh, public price for their malfeasance?


GDP Shrinks by 3.8% in Q4

Friday, January 30, 2009

From CNBC:

The economy shrank at a 3.8 percent pace at the end of 2008, the worst showing in a quarter-century, as the deepening recession forced consumers and businesses to throttle back spending.

But, as Clusterstock points out, the drop in real final sales was greater at 4.9%.

The country made up the difference by stuffing unwanted goods onto store shelves

No surprise, but still not pleasant to see. What do you think about Q1? I’m going with 6% drop in GDP. Who wants to go lower?


Dow Has Worst Start to a Year Ever

Wednesday, January 14, 2009

From CNBC:

The Dow and the S&P are actually having their worst opening to a new year ever: The Dow is down 6.6 percent since the ball dropped; the S&P is off 6.7 percent.

Did anyone expect otherwise?


Why Isn’t Bernie Madoff in Jail?

Tuesday, January 13, 2009

From Andrew Ross Sorkin:

Welcome to the two-tiered system of justice: one for the super-rich, the other for the rest of us.

Judge Ellis’s explanation is not very satisfying. He says that to be remanded to jail, a defendant must pose a flight risk or be at risk of obstructing justice.

The guys shipped millions in jewels and watches to his kids and his wife is paying for his security and monitoring with ripped off money. You’re telling me this guy isn’t a risk of obstructing justice?

BOOOOOOOOO!