{"id":196497,"date":"2008-04-22T16:38:00","date_gmt":"2008-04-22T21:38:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/04\/22\/economics-update-475\/"},"modified":"2008-04-22T16:38:00","modified_gmt":"2008-04-22T21:38:00","slug":"economics-update-475","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/04\/22\/economics-update-475\/","title":{"rendered":"Economics Update"},"content":{"rendered":"

It’s official, we’re in a recession, because Bush is denying that we are in a recession – Apr. 22, 2008<\/a>.<\/p>\n

For more direct evidence of a recession, we have American drivers cutting back on driving and gasoline usage<\/a>. When Americans stop driving, it means that the recession is here…big time<\/span>.<\/p>\n

<\/p>\n

In energy, oil broke $119\/bbl<\/a>, $110\/bbl now appears to be the new $100\/bbl<\/p>\n

Across the border, Canadian Central Bank cut rates by 50 basis points<\/a>, but even so, the Canadian dollar is still above parity with the US dollar, but they are definitely seeing the fallout from the US downturn.<\/p>\n

In other currency matters, the dollar weakened to above $1.60:\u20ac1.00<\/a>, though it’s now about $1.5992.<\/p>\n

At the beginning of the year, it was $1.48 or so.<\/p>\n

In things related to banking and real estate, we have to start with the elephant in the room, that GSEs Fannie Mae and Freddie Mac are looking increasingly at risk<\/a>, and a potential bailout would run to over $1 trillion, which might threaten the US government’s AAA rating.<\/p>\n

Generally, bank profits are tanking<\/a>, so it should come as no surprise that banks are retrenching.<\/p>\n

Notably, Bank of America will be ending subprime operations<\/a>, and tightening generally on mortgage standards, which makes it hard to understand why it’s buying Countrywide.<\/p>\n

Citi needs more capital, so it’s offerring $6.2 billion in hybrid bonds<\/a>, at 8.4%<\/span>, with an A2 rating.<\/p>\n

Hybrid bonds are….are….Ummm, a sort of hybrid between preferred stock and bonds…I’m confused, and they are described as “innovative”. I’ll try to get more information, but in the meantime, run away.<\/p>\n

Finally, the Fed bailout of banks continues apace, reaching $360 billion with the sale yesterday<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

It’s official, we’re in a recession, because Bush is denying that we are in a recession – Apr. 22, 2008. For more direct evidence of a recession, we have American drivers cutting back on driving and gasoline usage. When Americans stop driving, it means that the recession is here…big time. In energy, oil broke $119\/bbl, …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1080,973,1135,1004,1089],"tags":[],"class_list":["post-196497","post","type-post","status-publish","format-standard","hentry","category-currency","category-economy","category-energy","category-finance","category-recession"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/196497"}],"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=196497"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/196497\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=196497"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=196497"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=196497"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}