{"id":193221,"date":"2009-01-08T18:19:00","date_gmt":"2009-01-08T23:19:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2009\/01\/08\/economics-update-307\/"},"modified":"2009-01-08T18:19:00","modified_gmt":"2009-01-08T23:19:00","slug":"economics-update-307","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2009\/01\/08\/economics-update-307\/","title":{"rendered":"Economics Update"},"content":{"rendered":"

Initial claims for unemployment fell unexpectedly to 467,000<\/a>, but continuing claims increased to 4.6 million<\/a>, the highest number since 1982.<\/p>\n

We also saw Monster.com’s Online Job Index Stumbles falling in December<\/a>, which is another indication that we are nowhere near the bottom.<\/p>\n

In retail, holiday sales were grim<\/a>, with even Wal-Mart missing sales predictions.<\/p>\n

This is far from surprising when you consider the fact that consumer credit fell by a record amount in November<\/a>.<\/p>\n

People are not buying, they are paying down debt.<\/p>\n

Surveys in Europe are showing a precipitous drop in sentiment too<\/a>.<\/p>\n

We are also seeing a rather precipitous drop in port traffic in 2008<\/a>, it looks to be about 8%, to the lowest level since 2004, according to the National Retail Federation (NRF)<\/p>\n

Consumers are buying less, and domestic manufacturers are drawing down inventories, and both of these reduce the demand for imports.<\/p>\n

As such, it is no surprise that the Bank of England cut its benchmark rate by 50 basis points<\/a> (\u00bd%), the lowest since its founding…..In 1694<\/span><\/span>.<\/p>\n

Interest rates are still trending down here, with the 30-year fixed mortgage rate hitting a record low<\/a>.<\/p>\n

I’m not sure how long the low rates will last though, as Moody’s is reporting that the Federal Home Loan Banks (FHLB) are experiencing serious losses in mortgage backed bonds<\/a>, and may fall below required capital minimums as a result.<\/p>\n

While failure is not imminent, the spreads between their bonds and treasuries are rising as a result.<\/p>\n

BTW, we are also seeing holes in one of the panglossian predictions of real estate professionalw, residential rents are dropping too<\/a>, “apartment rents fell in 54 out of 79 U.S. metropolitan areas in the fourth quarter of 2008.”<\/p>\n

We are also getting rumblings that the Chinese are losing their appetite for US debt<\/a>, though Brad Setser says that this article is bogus<\/a>, and he has the number to show this.<\/p>\n

Really, the important thing here is not that people are not investing in US debt, it’s that they are talking about not investing, in the New York Times<\/span> no less, which is the first step to a drying up of foreign lending.<\/p>\n

The only foreign lending that does not seem to be decline is that of central banks to commercial banks. Case in point: the Bank of Japan decided to shovel $13 Billion to banks in the hopes of jumpstarting their lending<\/a>.<\/p>\n

In currency, the dollar fell today<\/a>, largely because the 50 basis point cut of the BoE was less than had been predicted.<\/p>\n

In energy, oil fell again<\/a>, on the expectation that the recession would continue to suppress demand.<\/p>\n","protected":false},"excerpt":{"rendered":"

Initial claims for unemployment fell unexpectedly to 467,000, but continuing claims increased to 4.6 million, the highest number since 1982. We also saw Monster.com’s Online Job Index Stumbles falling in December, which is another indication that we are nowhere near the bottom. In retail, holiday sales were grim, with even Wal-Mart missing sales predictions. This …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[973,975,1004,1088,1089,985],"tags":[],"class_list":["post-193221","post","type-post","status-publish","format-standard","hentry","category-economy","category-employment","category-finance","category-real-estate","category-recession","category-regulation"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/193221"}],"collection":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/comments?post=193221"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/193221\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=193221"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=193221"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=193221"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}