Every time I turn on the tv, I hear that the recession is over. We even have people on this forum predicting the next boom!
Here’s an article that brings a little REALITY to the hype.
…and an excerpt:
“The labour force contracted by 661,000. This did not show up in the headline jobless rate because so many Americans dropped out of the system. The broad U6 category of unemployment rose to 17.3pc. That is the one that matters.”
great article Mike…thanks for posting.
Have you ever seen any of David Rosenberg’s interviews?
I think he’s up in Toronto now…after having been with Bear Stearns. Good, hard nosed economist.
-Mike
:bobble You are so on point Propertymgr. No one seems to be paying any attention to the real hard numbers like: those who have exhausted their unemployment benefits, the small business owner who has closed their doors rather than renew their lease, and the other small home businesses that have no clients left as a result of this. Business owners and the self employed aren’t even factored in to that equation. This 10% figure hasn’t moved since last summer yet jobless claims continue. So how in the hell can we still have only 10% unemployment? I got family and friends who would love to know where this rebound is. Maybe they can move there and find work? Because it sure isn’t working for them where they are know.
This entire administration is nothing but blue smoke and mirrors for sure. Unless you’ve been living in a cave you can’t ignore the cold hard facts anymore. There isn’t one person in this county who either hasn’t been affected or doesn’t know of someone who hasn’t sustained a deep income loss in addition to the lower value of the dollar. My state just raised the unemployment withholding taxes on the businesses are still left. BTW I heard inflation was reported at less than .01%. Are you kidding me? The smoke screens the media is reporting is getting so thick very few can even separate the truth from the fiction. :banghead
Honestly Mike, I think it has much to do with what industry a person is in. Some industries are thriving and others are shrinking. I’ll give you some examples from personal experince.
I know multiple people and some friends, who are flipping homes and just had the best ever since being in realestate.
I have a relative who is working in the gun manufacturing industry and they have multiple shifts going with overtime, if they want it, with no site of layoffs and are hiring.
I have a sibling who got layed off from being in management in the retail industry last year. He looked for a job for 3 months, found another job being a ditrict manager in the retail maintenance business (overseeing flooring and other contracted maintenance items that are taken care of for big retail chains by contract employees) and the company is growing, paying bonuses, provides a company car, laptop, meal allowence and cell phone.
A major layoff went on where I currently work( IT Healthecare) where they layed off half the staff. Almost a year later most have have found new jobs in the same field, and some ended up getting better jobs than what they had. The only ones that I know of that didn’t get a job are the ones who are riding out their unemployment and I see them logged into facebook posting daily B.S. threads all week long, becasue they have too much time on their hands. I always see them complaining they can’t find a job, and yet, when anyone asks how they have all this time on their hands talking about the new game they are trying to “beat”, and why they haven’t found work when most have, their excuse is they must be unlucky. :banghead
I know guys who are in computer repair and/or IT consulting busines who either got layed off from IT jobs or have had their businesses for a while and they tell me they are thriving, with record year profits. They say they are busier now than ever and NEED to hire. Reason is, most people are not buying new computers and just repairing. They are also busy with small and med sized businesses showing them how to cut costs and impliment technology to make their businesses more efficient.
I haven’t heard of any doctors, nurses or hospital staff being layed off and work OT all the time.
My electrician is busier than ever.
I don’t doubt those numbers posted in the artcle at all, but it all depends on the industry and skills the individuals have and are in.
zerohedge.com does some pretty good investigative work…
good read:
related Bloomberg article:
http://www.bloomberg.com/apps/news?pid=20601082&sid=agHoPTbTklVI
and Mike…I want you to know that I looked far and wide for that article title:
“U.S. ECONOMY IS A PONZI SCHEME”
and for the data backing it up…(see page 2/4 of Sprott’s “Markets At A Glance”).
Just because you stick to your guns…literally and figuratively… :smile
-Mike
[actually…good dose of self-serving interest also…]
Good articles Mike. A key point is that the FED is printing money to buy treasuries, because the US can’t find anyone to buy its debt. That’s huge! Another key point is that Bill Gross, one of the worlds most powerful bond investors, is SELLING US TREASURIES!!! Bill Gross also has called the US Economy a ponzi scheme.
This is BAD, VERY BAD! Unfortunately, that’s just the tip of the iceberg. The banks are another example. They claim they’re making money, but they’re not. They’re getting a handout of FREE MONEY from the Fed and then getting a guaranteed return from the treasury. IT’S A SCAM! The government is simply giving money to the banks via this scam and calling it profit! The same with Freddie and Fannie - they now have an unlimited government blank check to cover their continuing losses. Again - there’s no profit here OR EVEN SOLVENCY - it’s a ponzi scheme. Autos? Another transfer of money from taxpayer, not only in the form of loans to GM and Chrysler that will NEVER be repaid, but also the cash for clunkers program which artifically boosted sales. Ditto housing and the government first time buyer programs. The biggest joke of all is that the money that “paid” for all of this DOES NOT EXIST - it’s just being printed out of thin air. IT IS THE LARGEST PONZI SCHEME IN THE HISTORY OF THE WORLD and as the article stated, all ponzi schemes collapse sooner or later!
As you can see, the above issues demonstrate that the USA is broke and in danger of collapse. However, that’s just the tip of the iceberg! The real issue is the more than $100 TRILLION dollars in unfunded liabilities going forward for welfare, medicaid, medicare, social security, etc, etc, etc. THESE PROGRAMS ARE ALL BROKE! Worse yet, the government is encouraging ever larger numbers of people to be lazy and sit on their butts. THERE IS NO WAY THAT FEWER AND FEWER TAXPAYERS CAN SUPPORT MORE AND MORE DEADBEATS! It simply won’t work.
At this point, TODAY, the game is up. WE ARE BROKE AND CAN NOT FINANCE OUR NATIONAL DEBT AND SPENDING! Real unemployment is 17.3% PLUS ALL THE DEADBEATS THAT THE GOVERNMENT IS PAYING NOT TO WORK (that no-body accounts for) - in other words - FAR, FAR ABOVE 30%! I’ve tried to find a report that discloses the true number of people on welfare, Section 8, etc, but the government is doing a masterful job of hiding this information. I did see a report that 21% of people in Ohio are receiving government handouts (and that does NOT include unemployment, which is not a handout). We’re in far deeper than the great depression and the con-men of the government have done a masterful job convincing the sheople that everything is ok by printing money to keep the ponzi scheme going!
Autos? Another transfer of money from taxpayer, not only in the form of loans to GM and Chrysler that will NEVER be repaid, but also the cash for clunkers program which artifically boosted sales.
Don’t forget the blue oval:
http://www.qualitymag.com/CDA/Articles/Industry_Headlines/BNP_GUID_9-5-2006_A_10000000000000619021
-Mike
Bill Gross also has called the US Economy a ponzi scheme.
I follow Bill Gross religiously as its part of my job as you know…Could please post the link to where Bill Gross calls the US Economy a “Ponzi scheme”…tia…
http://www.infowars.com/bill-gross-weve-got-a-ponzi-style-economy/
That’s just one link. If you google it, there are many more.
Propertymanager,
Great points…
“A key point is that the FED is printing money to buy treasuries, because the US can’t find anyone to buy its debt. That’s huge!”
Could also be why they are keeping interest rates low… Did anyone notice the Fed had a record-profit year also?
Social Security, Medicare and Medicaid are ALSO Ponzi-schemes… one where everyone is FORCED to participate… these programs are BROKE… and now we are getting ready to add ANOTHER ONE! Must be based on their EXCELLENT track record… :rolleyes
It is GUARANTEED to go broke AlSO…
Now NONE of the above take into account the ADDITIONAL $12+TRILLION in national debt, that will NEVER be paid off…
But lets just keep giving them more money and power… :banghead
But lets just keep giving them more money and power...
I know. I just don’t get what’s so difficult to understand. You’ll notice that no-one has argued any of this on the merits. Yes, it’s a ponzi scheme. The government knows it. Bill Gross knows it. We know it. How do they think it’s going to end???
Propertymanager,
“I know. I just don’t get what’s so difficult to understand. You’ll notice that no-one has argued any of this on the merits. Yes, it’s a ponzi scheme. The government knows it. Bill Gross knows it. We know it. How do they think it’s going to end???”
They know how it’s going to end, which is why I believe we are being undone from within…
Like I said…Tyler, Marla and crew……are doing a very good “Woodward & Bernstein” over at zerohedge.com.
Their readership also brings to light some more in-depth discussion, (referring back to the charts I found from a reader…see “Don’t Miss The Bus” post).
Sure beats the yipping and yapping puppetry over at CNBC….makes you wonder why Radigan left.
What’s the point?
At least from my perspective, it helps to identify trending tradeables to focus on.
With this much fiscal manipulation…it’s only logical to consider a diversified basket to hedge against whatever repercussions play out.
Pain in the ass to set it up….but what’s the alternative?
-Mike
http://www.youtube.com/watch?v=2hxlCUm_tVA
NJ….17th state…tax coffers must be really hurting
Allagash. Its interesting you mention Radigan leaving. I was think the other day that “Fast Money” was a better show with him on. I believe he left over a contract negotiations… :deal
much better…
he was always at or ahead of the curve.
-Mike
I agree with prop manager’s thread…the news wants to tell all about the increase in volume of sales, but the only thing that is selling is tax deeds, short sales, distressed properties, foreclosures, bank owned, etc…
I believe the market has not yet hit bottom, andwill not until we stop bailing the banks out…once we stop this, we will hit bottom and then quickly be able to start having the market come back…probably not for another 3-5 years…I think maybe even closer to ten like here is Florida which has been hit pretty hard…
From an economic standpoint I feel that there will not be a significant “boom” for quite sometime. It is interesting that so many people think our economy will just bounce back and be fine. The real estate market was stressed so thin and abused for so long by so many people. This is not to say that our economy could steadily grow to get better. But like almost all good things it is going to take a lot of time.
Karen Whitman
last thing I feel is that the economy will just bounce back and be fine…But there is tons of opps out there right now…if you have available capital…If you rely heavily on the banks and try to do the no money down route I can see the frustration…But IMHO we are in unprecendented times to make money…Atleast thats the way I see it…Im benefitting in a huge way from the banks closing their doors and I was discussing with fdjake via PM about deals and we both are like kids in a candy store…Its never been better to be in the real estate business…I bidded on a bank property today that sold in 2008 for 175k and the bank is letting it go to me for 19k…3 bedroom…2 bath condo…fdjake has the address and he verified it on zillow so im not making this up as I go…Im buying the property all cash for client and I have the buyer (at 27,900) putting %30 down and Im holding the balance at HM rates for 6 months until he can go conventional…These deals are everywhere…let it stay like this for a while…The bubble real estate market didnt benefit me as much as this downturn…
...let it stay like this for a while..
It’s going to be like this for a LONG time. The only change will be that the prices will get even lower. We currently have the largest supply of property on the market in history (16+ months) and it’s going to get much bigger.
I not only verified Rookies property but even talked to the realtor in Florida handling some of these sales…He is EXACTLY RIGHT.
Here’s what you need to remember…
THIS is EXACTLY how INVENTORY GETS ABSORBED…TAXMAN correctly pointed out that the majority of sales are Foreclosures, tax sales, ROE’s…OF COARSE THEY ARE…That’s what makes up the majority of the INVENTORY!!!
This is a MARKET REPAIRING ITSELF…OVER BUILDING LEAD TO OVER PRICING and OVER INVENTORIES…WHICH ALWAYS LEADS TO PRICE DROPS WHICH IN TURN LEAD TO PANIC and then PRICE
O V E R R E A C T I O N S!!!
When you can buy a COMPLETELY FINISHED CONDO for LESS than the cost to REHAB the KITCHEN and BATHROOMS in that same CONDO???
THAT IS CLASSIC MARKET OVER REACTION!!! CLASSIC!
The deals I’m seeing out there now are UNBELIEVABLE!!! MIND BOGGLING…I will make more money THIS YEAR than I have in any single year during my entire real estate career…the DEALS are everywhere IF you have CASH!!!
But the BEST part is EVERYONE thinks REAL ESTATE IS WORTHLESS…4 years ago everyone thought their property was worth a fortune…NOW they’re GIVING IT AWAY!!!
This is a GIANT SALE…BUY NOW…or kick yourself in the @ss for the next 20 years…
Mike says prices are going even LOWER…TO WHAT??? $17,000 for that condo Rookie just grabbed??? It ain’t EVER going to ZERO…The COPPER and METAL are worth something. WAITING for the BOTTOM is a SUCKERS BET…Always has been, always will be.