American Research Group has a survey on 2008 Holiday Shopping, and it has the predicting a 50% drop in sales vs 2007.
| Year | Average Spending | Percent Change |
| 2008 | $431 | – 50% |
| 2007 | $859 | – 5% |
| 2006 | $907 | – 4% |
| 2005 | $942 | – 6% |
| 2004 | $1,004 | + 3% |
| 2003 | $976 | – 6% |
| 2002 | $1,037 | -1% |
| 2001 | $1,052 | + 9% |
| 2000 | $968 | + 3% |
| 1999 | $939 | + 1% |
| 1998 | $928 | + 34% |
Considering the fact that 70% of the US economy is consumer driven, this is mind boggling.
We now have the following repors from the Times of London:
With Russian tanks only 30 miles from Tbilisi on August 12, Mr Sarkozy told Mr Putin that the world would not accept the overthrow of Georgia’s Government. According to Mr Levitte, the Russian seemed unconcerned by international reaction. “I am going to hang Saakashvili by the balls,” Mr Putin declared.
Mr Sarkozy thought he had misheard. “Hang him?” — he asked. “Why not?” Mr Putin replied. “The Americans hanged Saddam Hussein.”
Mr Sarkozy, using the familiar tu, tried to reason with him: “Yes but do you want to end up like [President] Bush?” Mr Putin was briefly lost for words, then said: “Ah — you have scored a point there.”
Bush has become the Bogeyman for the world.
He is now Homer Simpson, the stupid pathetic avatar of all that is stupid and pathetic, without the charm.
Well, most importantly it appears that Obama dodged a call from Lieberman to congratulate him on his election victory, and so Lieberman talked to Biden instead.
Not sure if it means anything, but fact that Senators Patrick Leahy and Bernie Sanders have both now publicly come out and said that his chairmanship should be pulled is significant.
Both Klobuchar and Bayh have said that they think that he should be allowed to keep his chairmanship if he apologizes for his behavior, but you will never, ever, see contrition from Joe, so I’m not sure if that means that they are creating an way to support him, or to oppose him.
Dodd, is still working very hard to keep Lieberman in the tent.
Retail sales are imploding Down 2.8% from September, and down 4.1% year over year,
Here is a historical data, courtesy of Calculated Risk, just so you know how bad these numbers look.
Of course, the financial press always has to find a silver lining, so they make note of the fact that consumer confidence rose from to 57.9 from 57.6, the article attributes this to falling gas prices, but I ascribe it to three words, “Buh Bye Bush.” With the election, they realize that Bush will soon be gone, and so the number goes, though the number still reflects major suckage.
In the overseas economy, yesterday, it was Germany, well today, it’s been confirmed that it’s actually the whole Euro Zone that is in recession.
Also, we have automotive news from that side of the pond, with the three major credit insurers in Europe pulling insurance coverage to suppliers of Ford and GM. Basically this means that if either of the auto makers default, the suppliers are on their own.
They have basically decided that the risk of a default is too much for them to cover.
And in domestic bad news cast as good news, we make note of the fact that banks and bank like institutions borrowed less from the Fed this week. Only an average daily borrowing rate of 95.4 billion, down from $110 billion.
Down to an average of 95.4 average daily borrowing list week. Let’s run the numbers 95.4 billion/business days * 250 days a year = 28.85 trillion…$23,850,000,000,000.00…By comparison, the US GDP in 2006 was 13.6 trillion.
We also have Freddie Mac tapping a $100 billion bailout fund that was not counted in the above.
As Calculated Risk notes, “Remember Fannie and Freddie have much lower default rates than the loans packaged by Wall Street. If conditions worsened dramatically for Freddie and Fannie, imagine how bad it is for Wall Street MBS and loans held by lenders like Wachovia (Wells Fargo) and WaMu (JPMorgan Chase).”
As to energy, oil is down on demand concerns, and and retail gasoline is down almost $2/gallon from peak.
There is a part of me that wonders if the swing in oil/gas was some sort of electioneering, but it clearly did not work.
In currency, the dollar rose, because when people are frightened, they still flee to the dollar for safety…for a while at least.
According to some well “placed sources”, yes Hillary is on the short list for Secretary of State.
This raises some interesting questions:
I’m not sure what numbers 1 and 2 mean, but what number 3 means is that the Clintonistas on the transition team cannot keep their damn mouths shut.
This is a good reason to keep former Clinton staffers to a minimum in his administration.
Go read the whole thing, it’s an inventory of how corruption, self dealing, stupidity, and lack of moral created the Wall Street debacle.
Upton Sinclair put it best when he said, “It is difficult to get a man to understand something when his salary depends upon his not understanding it, though in the case of Wall Street, it is more the year end bonuses than the straight salary.
Here is a typical quote:
That’s when Eisman finally got it. Here he’d been making these side bets with Goldman Sachs and Deutsche Bank on the fate of the BBB tranche without fully understanding why those firms were so eager to make the bets. Now he saw. There weren’t enough Americans with sh$#ty credit taking out loans to satisfy investors’ appetite for the end product. The firms used Eisman’s bet to synthesize more of them. Here, then, was the difference between fantasy finance and fantasy football: When a fantasy player drafts Peyton Manning, he doesn’t create a second Peyton Manning to inflate the league’s stats. But when Eisman bought a credit-default swap, he enabled Deutsche Bank to create another bond identical in every respect but one to the original. The only difference was that there was no actual homebuyer or borrower. The only assets backing the bonds were the side bets Eisman and others made with firms like Goldman Sachs. Eisman, in effect, was paying to Goldman the interest on a subprime mortgage. In fact, there was no mortgage at all. “They weren’t satisfied getting lots of unqualified borrowers to borrow money to buy a house they couldn’t afford,” Eisman says. “They were creating them out of whole cloth. One hundred times over! That’s why the losses are so much greater than the loans. But that’s when I realized they needed us to keep the machine running. I was like, This is allowed?”
People should be going to jail.
Lots and lots of people should be gong to jail.
So the Baltic Dry Index, a measure of the costs of shipping bulk cargo, have have dropped to 826 points on November 5, down from its high of 11793 in May:
Put simply, the cost of shipping has dropped through the floor. Sending a tonne of iron ore from Brazil to China in early June would have set you back more than $100 (£62) per tonne, or around $15m per voyage. But freight rates have now dropped to only slightly over $10 per tonne, or just $1.5m for the 70-90 day journey.
As if that wasn’t dramatic enough, the drop in daily charter rates is even sharper. At the peak of the market, a 170,000-tonne Capesize bulk carrier was hired out at the eye-watering daily rate of $234,000. At the beginning of this week, it was $5,611 – a fall of nearly 98 per cent.
Obviously, shipping has not fallen 90%, but the world has gone from serious shortage of shipping capacity to serious surfeit of shipping in about 6 months.
While that is concerning as an indicator of economic activity, what might be more concerning is the likelihood that a significant portion of world shipping, may simply shut down completely, because they are unable to get letters of credit from financial institutions.
Letters of credit are essentially guarantees that once cargo goes out to sea, that the value of the cargo will be delivered to the purchaser, and like other forms of insurance, it’s becoming increasingly hard to get, and so there is unshipped cargo sitting on docks for want of a letter.
I’ve been thinking about the case of MyColo Corp., which got shut down, and about 2/3 of all spam stopped.
Think about this: one server farm, operated by one bad actor, was, at least in the short term, responsible for the majority of the spam on the internet.
In the world of internet spam, phishing, and other bits of the dark side, a remarkably small number of people, possibly fewer in number than the fingers on Rahm Emanuel’s hand, are responsible for most of it.
This problem is thus more manageable than I would have thought.
Here is some sanity on trademark:
Lego has failed in its bid to register the shape of its play bricks as trade marks. A European court said that the brick shape was functional and that it had to be that shape to operate as it did, so could not be registered as a trade mark.
The Court of First Instance (CFI) of the European Communities backed a 2004 decision of the EU’s trade marks office the Office for the Harmonisation of the Internal Market (OHIM) to cancel Lego’s trade mark registration.
You heard right….The Lego Corporation was trying to trademark a brick.
McColo Corp. has been pulled off the internet.
It’s connectivity providers have disconnected it.
So, you don’t know McColo Corp.?
The servers are operated by McColo Corp., which these experts say has emerged as a major U.S. hosting service for international firms and syndicates that are involved in everything from the remote management of millions of compromised computers to the sale of counterfeit pharmaceuticals and designer goods, fake security products and child pornography via email.
But the company’s web site was not accessible today, when two Internet providers cut off MoColo’s connectivity to the Internet, security experts said. Immediately after McColo was unplugged, security companies charted a precipitous drop in spam volumes worldwide. E-mail security firm IronPort said spam levels fell by roughly 66 percent as of Tuesday evening.
(emphasis mine)
Funny name, but she is a serious regulator. In the late 1990s, she was head of the CFTC, and she warned that the unregulated CDS market was a disaster waiting to happen. For this she was vociferously attacked, and now Bloomberg news has an article about how she has been vindicated.
And who went after her for attempting to regulate Credit Default Swaps (CDS)?
Alan “Bubbles” Greenspan and Larry Summers, who the very serious people inside the beltway are suggesting would be a perfect Secretary of the Treasury.
I had concerns about their survival when they pulled out of the AOPA air show to save cash, but now we have reports that Eclipse just told employees that they would not be paid for their previous 2 weeks work.
It appears that they cannot raise enough capital to continue operating.
To quote Charles Maurice de Talleyrand-Périgord, there are reports that Democrats in the Senate, and Barack Obama, are now scrambling to find a way to do let Joe Lieberman keep hisposition as Chairman of the Senate Homeland Security Committee.
You know the old saying, better to be inside the tent pissing out, than outside pissing in, but Joe Liberman will be in the tent, and he will continue to piss inward.
Joe has been acting out of vindictiveness and ego ever since his Presidential bid crashed and burned in 2004, and his primary loss in 2006 only made this worse.
He does not care about policy, all he cares about is puffing himself up and hurting those who he believes have slighted him.
There is now a report on Rollcall (paid subscription required) that strongly implies that Obama is making calls in support of Lieberman.
If true, and this could be (I hope it is) some sort of head fake, it does now bode well with regard to how Obama, or the Senate Democrats intend to govern.
It feeds straight into the meme that Democrats are wimps. If they don’t stand up for themselves, how can we expect them to stand up for us.
Weekly initial unemployment claims are at 516,000, up from 484,000, well above the estimate of 479,000, and the highest number since 2 weeks after the 911 attacks.
With the caveat that weekly unemployment figures have a lot of noise, I would like to segue to a much noisier indicator, the Dow Jones Industrial Average, when fell below 8,000, though it rallied and ended up for the day.
Yean, I know, stock gyrations are really completely noise, but crossing 8K is a big deal for the markets, even if the Dow ended the day up 500+ points.
A better indicator of what is going on in the world is the fact that Germany is now officially in a recession, having experience two consecutive quarters of negative growth.
Calculated Risk’s regular post of credit crisis indicators, a very useful collection of interest rates and interest rate spreads really did not do much today.
That being days, CR does have a nice chart of spreads between 30 Year corporate bonds and treasuries, and it is not pretty: 
Of course if you want to be scared, the fact that foreclosures are up 25% year over year, and that Ranieri’s Franklin Bank has filed chapter 7 (liquidation).
They are the 3rd largest lender to fail this year.
Speaking of failures, there is already General Motors, and Goldman Sachs has suspended its rating of the auto maker, which is a polite way of saying, “Absent a bailout, it’s done.”
In the meantime, oil rose at the end of the day, along with the rising Dow, which indicates that oil traders are complete morons who trade on chicken entrails and other spooky omens.
The dollar was mixed today.
Well, it now appears that the lamest lame duck since Nixon announced his resignation 18 hours hence is now warning about the dangers of over regulation of a free market economy.
It appears that he is concerned that the G-20 meeting will result in calls for additional regulation to keep the Harvard Business School types from raping the general public.
So, George W. Bush, a man who was born on 3rd base, and thought that he had hit a home run,* can kiss my shiny metal ass.
*Yes, I know that I am mixing my metaphors. So sue me.
Well, Mark Begich just took an 814 vote lead over Stevens. I guess those folks who said that the late votes would break for him were right.
This is probably a relief for Senate Republican leaders, who were just served notice by Senator James Demint (R-SC) that he would move to expell him from the Republican caucus.
In Minnesota, the Secretary of State has laid out the process for a recount:
Secretary of State Mark Ritchie announced the formation of a five-person statewide canvassing board today that will oversee the mandatory recount in the U. S. Senate race. Minnesota Supreme Court Chief Justice Eric Magnuson and Ramsey County Chief Judge Kathleen Gearin, along with two other judges, will join Ritchie on the panel.
He appears to be doing all the right things, though Norm Coleman and His Evil Minions&trade are doing their level best to cast him as the 2nd coming of Katherine Harris.
Oh, chill out….He’s resigned from the Senate, effective November 16.
Governor Blagojevich will pick his successor.
This is yet another example as to why the IMF is fundamentally an evil and criminal organization that needs to be shut down:
However, the board will not in practice approve the loan until Iceland resolves a conflict with European governments over how foreign savers will be compensated for billions of dollars in losses suffered on their deposits in Icelandic banks, mainly at Landsbanki’s Icesave unit.
Translation, “We will make the loan, but all the money has to go to foreign creditors.”
I may have not given the IMF enough credit earlier.
I thought that they would treat Icenlanders better, because they are white, but not it appears that they are treating Icelanders like N*gg*rs.
I expect a deal for a Russian naval base, along with a Kremlin loan, in the next few months.
In a just world, people would leave when he walked into the room, because anyone who would say this:
A roomful of academics erupted in angry boos Tuesday morning after political analyst Michael Barone said journalists trashed Alaska Gov. Sarah Palin, the Republicans’ vice presidential nominee, because “she did not abort her Down syndrome baby.”
Is not a functioning member of humanity.
He later claimed that it was a joke, which makes it worse, because if he actually believes that, he is sick, and if it’s a joke, he’s just evil.
It’s nice to know that the Pentagon’s Defense Business Board is calling for real and deep cuts in weapons procurement spending.
I don’t think that it will amount to much though. I think that Obama will largely be rolled by the Pentagon, just like Clinton was.