{"id":194074,"date":"2008-10-27T17:35:00","date_gmt":"2008-10-27T22:35:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/10\/27\/economics-update-356\/"},"modified":"2008-10-27T17:35:00","modified_gmt":"2008-10-27T22:35:00","slug":"economics-update-356","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/10\/27\/economics-update-356\/","title":{"rendered":"Economics Update"},"content":{"rendered":"<p>While it&#8217;s generally known that the Fed will cut rates, it is news when <a href=\"http:\/\/bloomberg.com\/apps\/news?pid=20601068&amp;sid=azcLXzBlhXDY&amp;refer=home\">European Central Bank President Jean-Claude Trichet says that it&#8217;s likely that they will do the same<\/a>, it is a bit of a surprise.<\/p>\n<p>In terms of interest rate spreads, it&#8217;s not looking good, with <a href=\"http:\/\/www.bloomberg.com\/apps\/news?pid=20601087&amp;sid=aCGGtun4eNOY&amp;refer=home\">the spreads for Fannie Mae and Freddie Mac hitting the highest level since March<\/a>.<\/p>\n<p>In real estate we have Journalistic bullsh%$ good news, with reports that <a href=\"http:\/\/bloomberg.com\/apps\/news?pid=20601068&amp;sid=a4aBhfS9axuA&amp;refer=economy\">new home sales increased in September<\/a>, but as Barry Ritholtz of the <a href=\"http:\/\/bigpicture.typepad.com\/comments\/2008\/10\/new-home-sales.html\">The Big Picture notes<\/a>, these are bad numbers:<\/p>\n<blockquote style=\"color: rgb(0, 0, 153);\"><p>One other thing to note: Note the monthly 2.7% increase was based in part on last month&#8217;s being revised downwards, making the differential look bigger (this month is also likely to be revised downwards). Annualized sales for the month was 464k; Actual unadjusted monthly new home sales are about 35-45k, down from 100-120k (before they get annualized).<\/p><\/blockquote>\n<p>Year over year, house sales <span style=\"font-weight: bold;\">fell by 33%<\/span>, and prices fell by 9%.<\/p>\n<p>Meanwhile, it looks like the tax payers have <span style=\"font-weight: bold;\">already<\/span> sent a significant chunk of change to the banks <a href=\"http:\/\/business.timesonline.co.uk\/tol\/business\/industry_sectors\/banking_and_finance\/article5024323.ece\">$63 billion to 15 banks<\/a>:<\/p>\n<ul>\n<li> PNC Financial Services ($7.7 billion)<\/li>\n<li> Capital One Financial ($3.55 billion)<\/li>\n<li> Regions Financial ($3.5 billion)<\/li>\n<li> SunTrust Banks ($3.5 billion)<\/li>\n<li> KeyCorp ($2.5 billion)<\/li>\n<li> Comerica ($2.25 billion)<\/li>\n<li> State Street ($2 billion)<\/li>\n<li> Northern Trust ($1.5 billion)<\/li>\n<li> Huntington Bancshares ($1.4 billion)<\/li>\n<li> First Horizon National ($866 million)<\/li>\n<li> City National ($395 million)<\/li>\n<li> Valley National Bancorp ($330 million)<\/li>\n<li> UCBH Holdings ($298 million)<\/li>\n<li> Washington Federal ($200 million)<\/li>\n<\/ul>\n<p>Oh&#8230;me bad&#8230;I forgot that <a href=\"http:\/\/www.marketwatch.com\/news\/story\/bbt-get-31-bln-treasurys\/story.aspx?guid=%7B4316D354-DB69-4174-BBEE-F5F4887C89F4%7D&amp;dist=msr_2\">BB&amp;T is in for $3.1 billion too.<\/a><\/p>\n<p>Well, at least <a href=\"http:\/\/www.cnn.com\/2008\/US\/10\/26\/gas.prices\/index.html?eref=rss_topstories\">gas prices<\/a> and <a href=\"http:\/\/money.cnn.com\/2008\/10\/27\/markets\/oil\/\">oil prices<\/a> are continuing to fall.<\/p>\n<p>In currency, we have<br \/><a href=\"http:\/\/money.cnn.com\/2008\/10\/27\/markets\/dollar\/index.htm\">the dollar and yen pounding the Euro and Pound<\/a> to the degree that <a href=\"http:\/\/www.bloomberg.com\/apps\/news?pid=20601087&amp;sid=avchlotubF5g&amp;refer=home\">the bank of Japan is considering an intervention to keep the Yen form spiking too high<\/a>.<\/p>\n<p>It also looks like the Australian dollar is at serious risk of falling off a cliff, see <a href=\"http:\/\/www.cnbc.com\/id\/27408520?__source=RSS*tag*&amp;par=RSS\">here<\/a> and <a href=\"http:\/\/bloomberg.com\/apps\/news?pid=20602081&amp;sid=aybu4WkiW1ac&amp;refer=benchmark_currency_rates\">here<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>While it&#8217;s generally known that the Fed will cut rates, it is news when European Central Bank President Jean-Claude Trichet says that it&#8217;s likely that they will do the same, it is a bit of a surprise. In terms of interest rate spreads, it&#8217;s not looking good, with the spreads for Fannie Mae and Freddie &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1112,1080,973,1135,984,1004,1188,1088],"tags":[],"class_list":["post-194074","post","type-post","status-publish","format-standard","hentry","category-australia-and-new-zealand","category-currency","category-economy","category-energy","category-europe","category-finance","category-japan","category-real-estate"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/194074"}],"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=194074"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/194074\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=194074"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=194074"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=194074"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}