WHAT IS BEING PEDDLED AS RECOVERY

 

Highlights

• New home sales fell from a downwardly revised 369,000 (from 389,000) in September to 368,000 in October. The Briefing.com consensus pegged the number of new homes sold at 388,000.

Key Factors

• It was disappointing to see such a stark downward revision to the September data. Even though the new housing market may not be as solid as once thought, the trends in the sector continue to be favorable.
• A lack of inventories of distressed properties has limited the negative effect of foreclosures on existing home prices. That has caused existing home prices to increase over the past few months. As a result, the price premium between a new home and an existing home has shrunk considerably, making new homes relatively cheaper than before and in more demand.
• Absolute inventory levels of new homes remain near historical lows. Builders will need to continue to boost production in order to meet the newfound demand.
• Median new home prices increased 5.7% y/y to $237,700.

 

 

Read more: http://www.briefing.com/Investor/Calendars/Economic/Releases/newhom.htm#ixzz2DdfisyIX

 

Consumer confidence current is at 60???? last recovery peaked at 140 !!! WTF are they peddling here as a recovery?

 

You can see above chart of housing, coud you choke somebody when they continue to chirp about this recovery?

 

Now headlines say every time a single word is uttered about the "FISCAL CLIFF" and a DEAL is near......is reason for stocks to rally. BS

It's the time of year.....stocks tend to be bullish end of year into XMAS.

 

The real trouble may not show until well into 2013....or who knows, maybe people wake up sooner.

 

D

FUTURE GROWTH PROSPECTS

The Five-Year Funk: OECD Slashes Global Growth Estimates

Breakout Three mediocre years after the last recession ended, one of the world's leading economic policy advisers is warning that another may be on the way, as dawdling leaders in Europe and the U.S. fail to deliver the comprehensive solutions needed to restore growth.

DISTORTIONS TO A SOUND ECONOMY

"It is inaccurate to blame the 2008/09 financial crisis for the lagging U.S. recovery. Poor post-Bubble economic performance instead relates directly to previous boom-time excesses. And there should be little debate that loose Federal Reserve policies played prominently throughout the mortgage finance Bubble period. A system just doesn't almost double total outstanding mortgage Credit in about six years without unleashing major distortions in the allocation of resources and spending/investing patterns throughout the real economy. And surely no one can argue that four years of zero rates and massive federal deficit spending have fostered sound resource allocation and significant economic wealth-creating investment."
http://www.safehaven.com/article/27802/follwing-weidmann-lacker-takes-a-stand

Mis-allocation of resources, lack of real investment dollars, a fostering of more credit excesses in attempt to revive a financial mania, no wonder the economy is not creating enough jobs and wages continue to fall to stagnate, not keeping up with the rise in costs of things we need.

SOUND MONEY. Growth is fostered by sound money policies and rewards for real investment. With a ZERO FED interest rate policy, governments spending well beyond what they can afford to spend in efforts to revive the economy have not put us on a path to recovery.

A one sided approach will not bring us to a soft landing. The stock market being targeted by the FED specifically goes against their doctrine, but desperate times call for desperate measures?

D

RECENT SPX ACTION

All this to retest the 50 DMA?

ELEVATED CLAIMS

Revised up last report 20,000 more to 459,000, this week down to 410,000. Is this an abheration because of storm? WHERE then are the seasonal hires we expect this time of year? Have these figures been adjusted to reflect small business hiring that usually occurs this time of year whether it does or not?

D

HOUSING RECOVERY? NOT COMPLEX

http://finance.yahoo.com/news/yes-housing-starts-surge-rentals-203912363.html

The recovery is almost all due to a surge in apartment complex building.

D

SPX ACTION

Excerpt from Doug Noland Essay "WHERE MONEY DIES"

"There was talk this week of the need for larger monthly QE from the Fed. The markets also anxiously await the firing up of Dr. Draghi's bazooka. A new Japanese government could see the Bank of Japan further crank up their white-hot electronic printing press. With new leadership in China, perhaps they'll be ready to push further on the accelerator. It all seems rather "late-cycle" to me. And, I'll suggest, a loss of confidence in all these electronic journal entries - the global financial system more generally - is this historic cycle's greatest vulnerability. As we witnessed not many years ago, one day everyone is so enjoying the dance party and the next they're fighting for the exits. It's a spiking the punch rather than removing the punchbowl dilemma."

http://www.safehaven.com/print/27730/when-money-dies  New home for Doug Noland

JUMP IN UNEMPLOYMENT CLAIMS

A HUGE jump in claims to over 430,000 this week, much of this is blamed on Sandy weather event, but that was 3 weeks ago.

WMT posts LOWER revenues, another sign of the weakening Consumer, especially lower to middle class citizens.

Wages are still falling, another .2, couple with WMT data, it is pretty obvious the avg American is finding it harder and harder to keep up.

Europe declares another Recession. We have the FISCAL CLIFF worries, but with that being repeated every day, is that already reflected in stock prices?

The market is clearly oversold, so it's important to see if it can mount some kind of rally from exhausted sellers. I plan on CHARTING the action this weekend to show you what has been happening.

D

VIXEN

Similar complacency bottoming pattern to 2007 MARKET TOP. And IMHO that is where we are headed or already got there. It's amusing how the expert players come here and dis me for not seeing ONLY blue skies and forever BULL MKTS.....and more amusing when they scurry back under their rocks when the shit hit the fan....and I get accused of being a broken record?

Well, those who have been following me I've been writing ever since we began this SECULAR BEAR phase, so as far as I can see......we have piled more crap on top of existing crap and the natural balance of things has been fought tooth and claw, so things have not been allowed to go their course and then we heal.....the idiots have made it worse! FED IDIOTS caused the issues and have added insult to bloody injury....

We hear those cheers from those that like what has gone down the last 4 years, but and it's great that pre-existing conditions dont mean you cannot get insured, but NOWHERE in the 2500 pages of this monstrosity of a bill, does it do anything to help CONTAIN COSTS! Insurance companies will raise rates on all to cover the changes made in the bill.

The market is now a might bit oversold, so I expect a bounce of some kind to begin shortly. ALL you see are CLIFF CLIFF FISCAL CLIFF...ow ow ow. Just some of the problems ahead.
WHAT IF a cliff dive is averted? delayed? bulls and bear get trapped in this ugly mkt.

SEE you at SPX 800 or below.

D

"FOOD STAMP NATION"

http://market-ticker.org/

WHAT GOES UP......

http://www.minyanville.com/business-news/markets/articles/stock-market-stock-market-patterns-s2526p500/11/9/2012/id/45706

Interesting chart from Zero Hedge

http://www.zerohedge.com/news/2012-11-09/most-important-chart-consider-weekend-or-tom-lees-nightmare

SUGAR HIGH?

"The stock market will suffer over the 12-month period, which always happens the year after an election," said Len Tannenbaum, CEO of Fifth Street Finance in New York.
Tannenbaum said the effects of the Federal Reserve's quantitative easing debt-buying program will fade this year after helping boost equity performance throughout Obama's first term.

"The market has been propped up by these sugar highs," he said. "QE half-trillion a year is not sustainable in the long run. The sugar high is going to end because Barack Obama is going to raise revenue and cut entitlements. The combination of the two cannot be good for the economy."
Indeed, economists have been busy cutting numbers for future growth in the wake of Hurricane Sandy as well as the drag effects from whatever solutions are devised to avoid the fiscal cliff.
Goldman Sachs on Wednesday cut its fourth-quarter gross domestic product forecast from 1.9 percent growth to 1.5 percent. The cuts were based on the likelihood that Obama will kill the George W. Bush-era tax cuts for those making above $250,000, and the drag that Superstorm Sandy will have on the economy."
http://finance.yahoo.com/news/why-stocks-may-keep-falling-140750592.html

MARKET SELL OFF

Market selloff. APPL is off over 20% since it made highs at $705, you damn sure DO have to TIME the market....what does this all mean? Businesses do not like uncertainty, the certainty is 4 more years like we've had, maybe that is a problem...FISCAL CLIFF talk is that.....I think its in the soup...its something else..

I am not screaming chicken little, what I AM saying is there is a ton of complacency out there, the makret is overvalued, and things tend to recvert to the mean, which in past corrections is plain fact for those who bother to look or ask.

Not dividend yields nor PE ratio of the SPX 500 is anywhere near a true reckoning bottom, IMHO.

WTF do I know? just one dude talking here to myself?

D

POST ELECTION BLUES

http://seekingalpha.com/article/990091-so-much-for-certainty-explaining-yesterday-s-market-plunge?source=yahoo

KISS OFF

Interesting day AFTER? The market has been working UNDER the 50 DMA and has kissed off it several times.

Now the lower boundery (dashed line) and the 200 DMA are potential support and targets.

Possible rebound for a few days after this 300 pt loss.

D

VICTORY WILL BE BITTER SWEET

U.S. Futures Fall, Dollar Slips; Global Shares Gain After Obama Win

" World shares and gold rallied while the dollar fell and U.S. futures fell on Wednesday after President Barack Obama was re-elected for a second term, signaling no dramatic shift in U.S. economic policy."
 
Isn't this what the market wanted as it rose yesterday in anticipation of Obama victory? IMHO, was the victory ever in doubt with such a weak opponent?

This victory is a gift to the other party/s....there is nothing that can stop the deflationary debt deleveraging going on, it is not the 9th inning there, more like in the middle, most of the reductions in household debt have come from defaults on mortgages. A SPARK to set off a worse outcome would be...a RISE IN TAXATION, and a pronounced AUSTERITY move....not now...now is not the time for that. But with fiscal cliff talk...and now a TEFLON President with a mandate against "the rich" the JOB PRODUCERS....2013-2014 could turn mucho ugly, IMHO

CYCLE FORECAST

http://www.safehaven.com/print/27598/why-bernanke-cant-stop-the-kress-cycle-tsunami

BLACK SWAN EVENTS

http://prudentbear.com/index.php/creditbubblebulletinview?art_id=10725

"Politicians, central bankers and governments are trapped in “do whatever it takes” late-cycle reflationary measures. You can bet on it. Many have. And the global Credit Bubble dynamic will ensure that the world remains short-sided and blind to myriad serious risks until it’s too late.

We’re today in the midst of the manic financial Bubble phase. Especially here in the U.S., the markets will finance virtually anything. There’s hardly a junk bond the market doesn’t love. CDOs are back. Relatively higher-yielding municipal debt induces salivation. There are, then, no worries regarding the ability to finance Sandy recovery and rebuilding efforts. Costs really don’t matter. 
Wealth destruction is basically irrelevant. If it’s “money” that’s needed, well, we’ve got the Bernanke Fed. And why not just rebuild on the water’s edge and buy cheap federal flood insurance. “Broken windows,” broken subways, broken transformers, broken communication hubs, and broken neighborhoods are sure to incite a borrowing and spending boom. Dr. Bernanke’s “mopping up” strategy in action."