{"id":193652,"date":"2008-11-26T18:36:00","date_gmt":"2008-11-26T23:36:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/11\/26\/economics-update-334\/"},"modified":"2008-11-26T18:36:00","modified_gmt":"2008-11-26T23:36:00","slug":"economics-update-334","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/11\/26\/economics-update-334\/","title":{"rendered":"Economics Update"},"content":{"rendered":"<p>Well, it looks like today was the day for all the stuff you wanted to dump before a 4 day weekend.<\/p>\n<p>First, <a href=\"http:\/\/money.cnn.com\/2008\/11\/26\/news\/economy\/personal_income_spending\/index.htm\">consumer spending fell 1%<\/a>, well beyond the prediction of 0.7%.<\/p>\n<p>Remember that these days, the Christmas season starts in October for a lot of people.<\/p>\n<p>This is a crushing figure, and it&#8217;s not just due to falling energy prices, because people are paying down debt too.<\/p>\n<p>The <a href=\"http:\/\/www.cnbc.com\/\/id\/27925978\">consumer confidence numbers reinforce this<\/a>.  The index is at 55.3, the lowest number since 1980, though still above the record of 51.7 in May, 1980.<\/p>\n<p>Confidence not any better on the business side of things, with<br \/><a href=\"http:\/\/www.nytimes.com\/aponline\/washington\/AP-Durable-Goods.html?_r=1&amp;oref=slogin\">durable goods orders falling 6.2% in October<\/a>, and no, that&#8217;s not an <span style=\"font-weight: bold;\">annual<\/span> rate, that is the shrinkage <span style=\"font-weight: bold;\">for the month<\/span>.<\/p>\n<p><a href=\"http:\/\/img155.imageshack.us\/img155\/5043\/weeklyclaimsnov262008nk1.jpg\"><img decoding=\"async\" src=\"http:\/\/img155.imageshack.us\/img155\/5043\/weeklyclaimsnov262008nk1.jpg\" style=\"margin: 0px 20px 10px 0px; float: left; cursor: pointer; width: 400px;\" \/><\/a>The unemployment stats say that <a href=\"http:\/\/www.reuters.com\/article\/businessNews\/idUSTRE4AP3UJ20081126?feedType=RSS&amp;feedName=businessNews\">weekly jobless claims fell last week<\/a>,  but I&#8217;m taking that with a grain of salt for the following reasons:<\/p>\n<ul>\n<li>Initial claims for state unemployment insurance benefits were a seasonally adjusted 529,000 in the week ended November 22 from an <span style=\"font-weight: bold;\">upwardly revised 543,000<\/span> the previous week&#8230;..Meaning that you compare lower initial numbers versus the later ones from the previous week, and it&#8217;s a &#8220;drop&#8221;&#8230;.yeah right.<\/li>\n<li>The 4 week moving average, which smooths out the noise, <a href=\"http:\/\/calculatedrisk.blogspot.com\/2008\/11\/weekly-initial-unemployment-claims-4.html\">hit a 25 year high<\/a>. (click for full size pic)<\/li>\n<\/ul>\n<p>Just in case you are wondering how bad this will get, note that <a href=\"http:\/\/www.cnbc.com\/\/id\/27923469\">Fitch just cut its ratings on Toyota&#8217;s bonds to AA from AAA<\/a>.<\/p>\n<p>Seriously this is a Stay-Puft Marshmallow Man news.<\/p>\n<p>The credit markets are freezing up, though <a href=\"http:\/\/www.cnbc.com\/\/id\/27923432\">applications for mortgages are up<\/a>, largely on insanely low interest&#8230;.I wonder how many applications are rejected though.<\/p>\n<p>I would also note that <a href=\"http:\/\/online.wsj.com\/article\/SB122771251156859761.html?mod=rss_whats_news_us\">new home sales declined to the lowest level since 1982<\/a>, so its not like there are a sh^%load of buyers out there.<\/p>\n<p>As a result of all this, we are seeing a number of rescue packages world wide, with the <a href=\"http:\/\/news.bbc.co.uk\/2\/hi\/business\/7749382.stm\">European Commission announcing a \u20ac200 stimulus plan<\/a>, <a href=\"http:\/\/news.bbc.co.uk\/1\/hi\/business\/7749741.stm\">]China&#8217;s central bank cutting rates<\/a>.<\/p>\n<p>These are probably what <a href=\"http:\/\/money.cnn.com\/2008\/11\/26\/markets\/dollar\/index.htm\">drove the dollar up today<\/a>, and it also <a href=\"http:\/\/money.cnn.com\/2008\/11\/26\/markets\/oil\/index.htm\">drove oil up<\/a><\/p>\n<p>That being said, I think that the most troubling indicator is the fact that the <a href=\"http:\/\/money.cnn.com\/2008\/11\/26\/markets\/bondcenter\/bonds\/index.htm\">10-year Treasury yield fell below 3%<\/a>, a new record, and this indicates that the flight to the relative safety of US Treasuries is continuing unabated.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Well, it looks like today was the day for all the stuff you wanted to dump before a 4 day weekend. First, consumer spending fell 1%, well beyond the prediction of 0.7%. Remember that these days, the Christmas season starts in October for a lot of people. This is a crushing figure, and it&#8217;s not &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[973,1135,984,1004,1088,1089],"tags":[],"class_list":["post-193652","post","type-post","status-publish","format-standard","hentry","category-economy","category-energy","category-europe","category-finance","category-real-estate","category-recession"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/193652"}],"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=193652"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/193652\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=193652"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=193652"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=193652"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}