{"id":197020,"date":"2008-03-07T17:39:00","date_gmt":"2008-03-07T22:39:00","guid":{"rendered":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/03\/07\/economics-update-506\/"},"modified":"2008-03-07T17:39:00","modified_gmt":"2008-03-07T22:39:00","slug":"economics-update-506","status":"publish","type":"post","link":"https:\/\/www.panix.com\/~msaroff\/40years\/2008\/03\/07\/economics-update-506\/","title":{"rendered":"Economics Update"},"content":{"rendered":"<p><a href=\"http:\/\/money.cnn.com\/2008\/03\/07\/markets\/oil_prices.ap\/index.htm?postversion=2008030711\">Oil hits another record<\/a>, breaking $106\/bbl, and the <a href=\"http:\/\/money.cnn.com\/2008\/03\/07\/markets\/bc.dollar.ap\/index.htm\">Dollar falls again<\/a> another record against the Euro, and a 3 year low against the Yen.<\/p>\n<p>As I&#8217;ve noted before, these are tied together.  The expectation of a falling dollar pushes up the dollar denominated cost of oil to maintain the same global purchasing power.   <\/p>\n<p>Closer to home, the US <a href=\"http:\/\/bloomberg.com\/apps\/news?pid=20601087&amp;sid=aG6e0kEzgR5E&amp;refer=home\">lost 63,000 Jobs in February<\/a>, which was an unexpected 5 year high.<\/p>\n<p>Not surprisingly, this is accompanied by <a href=\"http:\/\/biz.yahoo.com\/ap\/080307\/consumer_confidence.html\">consumer confidence at a six year low<\/a>.<\/p>\n<p>Luckily for us, the Fed is riding to the rescue, and <a href=\"http:\/\/money.cnn.com\/2008\/03\/07\/news\/economy\/Federal_liquidity.ap\/index.htm?postversion=2008030709\">printing up more money to give to the jerks who screwed this up in the first place<\/a>.  The March money sales have been increased from $60 billion to $100 billion.<\/p>\n<p>Carlyle Capital is being to forced to liquidate securities, one would assume <span style=\"font-weight: bold;\">well<\/span> below purchase price, to <a href=\"http:\/\/www.nytimes.com\/2008\/03\/07\/business\/worldbusiness\/apee-carlyle.html\">meet its margin calls<\/a>. <\/p>\n<p>That&#8217;s what 32:1 leverage gets you.<\/p>\n<p>The lenders are getting skittish, and they are starting to <a href=\"http:\/\/online.wsj.com\/article_email\/SB120485290396718251-lMyQjAxMDI4MDA0NzgwNTcyWj.html\">ask for some or all of their money back<\/a> from hedge funds and other speculative entities. <\/p>\n<p>And why shouldn&#8217;t they as <a href=\"http:\/\/online.wsj.com\/article\/SB120485071664018195.html?mod=hps_us_whats_news\">the housing crash is chewing up their balance sheets like a great white shark<\/a>.<\/p>\n<p>So we have <a href=\"http:\/\/www.bloomberg.com\/apps\/news?pid=20601087&amp;sid=aYYI8yE9Hme0&amp;refer=home\">money fleeing to the safe haven of US treasuries<\/a>, because they are expecting another shoe to drop, like, for example, the possibility that, <a href=\"http:\/\/money.cnn.com\/2008\/03\/07\/markets\/bc.apfn.fitch.alta.ap\/index.htm?postversion=2008030709\">Fitch Ratings might downgrade $160 billion in Alt-A mortgage backed securities<\/a>, which is rumored to be imminent.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Oil hits another record, breaking $106\/bbl, and the Dollar falls again another record against the Euro, and a 3 year low against the Yen. As I&#8217;ve noted before, these are tied together. The expectation of a falling dollar pushes up the dollar denominated cost of oil to maintain the same global purchasing power. Closer to &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1080,975,1135,1004],"tags":[],"class_list":["post-197020","post","type-post","status-publish","format-standard","hentry","category-currency","category-employment","category-energy","category-finance"],"_links":{"self":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/197020"}],"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=197020"}],"version-history":[{"count":0,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/posts\/197020\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/media?parent=197020"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/categories?post=197020"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.panix.com\/~msaroff\/40years\/wp-json\/wp\/v2\/tags?post=197020"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}