Official "Recession"
Downgrades... UBS downgrades IBM, EMC & Dell, forecasts lower spending on server's and PC's in 2008.
Best Buy downgraded to Underperform from Outperform at Bear Stearns
McBaristas and McLatte... McDonald's will be adding coffee bars in nearly 14,000 restaurants.
Refuting the Mantra.... Ol Hanky sure has changed his tune of late....
U.S. Treasury Secretary Henry Paulson said the immediate goal is to minimize impact of the housing downturn on the economy...
but emphasized no single policy or action will undo the "excesses" of recent years.
Paulson also expressed that people should not surprised or disappointed to see financial institutions announce more asset write-downs. Really? Do ya think Hank?
Odd's are, two years behind... Harvard University economist Martin Feldstein...
said the odds of a recession have risen to more than 50 percent after a report showing unemployment jumped in December.
"We are now talking about more likely than not." Feldstein, president of the NBER or National Bureau of Economic Research.
Negatives gaining... Atlanta Fed Head Dennis Lockhart said negatives in the U.S. economy may be gaining momentum,
and market contacts have serious concerns about more market deterioration and spill over.
He also said the continued depreciation of the dollar is a risk. Really? Debauchery of the dollar? What does Jim Rogers have to say about all this?
Mister Roger's Neighborhood... "It's going to be one of the worst recessions we've had in a while because we had so many excesses going into it.
It's going to be bad for all of us as currencies come under more and more stress and we have more inflation in the world.
The U.S. and U.K. governments have been lying about inflation." The government LYING??? NO! NEVER!
"I hope by the end of this year all of my assets will be out of the U.S. dollar.
The dollar is a currency that's terribly flawed and it's going to be under duress for many years to come.
If you're worried about a recession, you might think about buying agricultural commodities.
I suspect agriculture is going to do well no matter what happens to the world economy.
All commodities are going to be in much shorter supply for another decade. So even if the dollar goes up, commodities are going to go higher."
Notes on a recession...
Merrill Lynch's cheif North American economist David Rosenberg has some notes for his clients...
At no time in the past sixty years has the unemployment rate risen 60 basis points from the cycle low without the economy slipping into recession, and here we now have the jobless rate hitting 5% in December versus the March/07 trough of 4.4%.
Aggregate hours worked contracted for two straight quarters. Back to back declines in total hours worked ALWAYS has been associated with a recession.
ISM fell under 50%, household employment contracted, YOY unemployment has increased by double digits, all showing the bleed from housing into other sectors of the economy that are now just starting to layoff.
"Friday's employment report confirmed our suspicions that the economy was transitioning into an official recession towards the end of last year. Friday's employment report strongly suggests that an official recession has arrived.
The recession dating committee at the National Bureau of Economic Research (NBER) will be the final arbiters, but since it waits for conclusive evidence, including benchmark revisions, it may be at least two years before we are notified."
Validation... Rosenberg's assessment was validated in another Wall Street research note posted this morning.
Richard Berner and David Greenlaw, economists for Morgan Stanley, wrote:
"Incoming data suggest that tighter credit has pushed the US economy to the brink, and we reiterate our call for a mild U.S. recession in the first half of 2008.
Weak employment data and slowing in export orders reported by purchasing managers undermine the case that a healthy consumer and strong global growth would forestall a downturn.
Moreover, the ongoing housing recession is deepening, declines in capital goods bookings hint that business equipment spending will contract, and inventory liquidation seems likely."
The Nattering One muses... thats just warm rain falling on us right?
Rosenberg is generous in giving the NBER a two year window. When they tell you downturn, its a recession, when they tell you recession, its a depression.
Its official, we have been in a recession since 2002 and we are now heading into a depression.
Best Buy downgraded to Underperform from Outperform at Bear Stearns
McBaristas and McLatte... McDonald's will be adding coffee bars in nearly 14,000 restaurants.
Refuting the Mantra.... Ol Hanky sure has changed his tune of late....
U.S. Treasury Secretary Henry Paulson said the immediate goal is to minimize impact of the housing downturn on the economy...
but emphasized no single policy or action will undo the "excesses" of recent years.
Paulson also expressed that people should not surprised or disappointed to see financial institutions announce more asset write-downs. Really? Do ya think Hank?
Odd's are, two years behind... Harvard University economist Martin Feldstein...
said the odds of a recession have risen to more than 50 percent after a report showing unemployment jumped in December.
"We are now talking about more likely than not." Feldstein, president of the NBER or National Bureau of Economic Research.
Negatives gaining... Atlanta Fed Head Dennis Lockhart said negatives in the U.S. economy may be gaining momentum,
and market contacts have serious concerns about more market deterioration and spill over.
He also said the continued depreciation of the dollar is a risk. Really? Debauchery of the dollar? What does Jim Rogers have to say about all this?
Mister Roger's Neighborhood... "It's going to be one of the worst recessions we've had in a while because we had so many excesses going into it.
It's going to be bad for all of us as currencies come under more and more stress and we have more inflation in the world.
The U.S. and U.K. governments have been lying about inflation." The government LYING??? NO! NEVER!
"I hope by the end of this year all of my assets will be out of the U.S. dollar.
The dollar is a currency that's terribly flawed and it's going to be under duress for many years to come.
If you're worried about a recession, you might think about buying agricultural commodities.
I suspect agriculture is going to do well no matter what happens to the world economy.
All commodities are going to be in much shorter supply for another decade. So even if the dollar goes up, commodities are going to go higher."
Notes on a recession...
Merrill Lynch's cheif North American economist David Rosenberg has some notes for his clients...
At no time in the past sixty years has the unemployment rate risen 60 basis points from the cycle low without the economy slipping into recession, and here we now have the jobless rate hitting 5% in December versus the March/07 trough of 4.4%.
Aggregate hours worked contracted for two straight quarters. Back to back declines in total hours worked ALWAYS has been associated with a recession.
ISM fell under 50%, household employment contracted, YOY unemployment has increased by double digits, all showing the bleed from housing into other sectors of the economy that are now just starting to layoff.
"Friday's employment report confirmed our suspicions that the economy was transitioning into an official recession towards the end of last year. Friday's employment report strongly suggests that an official recession has arrived.
The recession dating committee at the National Bureau of Economic Research (NBER) will be the final arbiters, but since it waits for conclusive evidence, including benchmark revisions, it may be at least two years before we are notified."
Validation... Rosenberg's assessment was validated in another Wall Street research note posted this morning.
Richard Berner and David Greenlaw, economists for Morgan Stanley, wrote:
"Incoming data suggest that tighter credit has pushed the US economy to the brink, and we reiterate our call for a mild U.S. recession in the first half of 2008.
Weak employment data and slowing in export orders reported by purchasing managers undermine the case that a healthy consumer and strong global growth would forestall a downturn.
Moreover, the ongoing housing recession is deepening, declines in capital goods bookings hint that business equipment spending will contract, and inventory liquidation seems likely."
The Nattering One muses... thats just warm rain falling on us right?
Rosenberg is generous in giving the NBER a two year window. When they tell you downturn, its a recession, when they tell you recession, its a depression.
Its official, we have been in a recession since 2002 and we are now heading into a depression.
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