Study shows that Western economies displayed the same manic behavior as psychologically disturbed people in the runup to the 2008 credit crisis, which could be repeated. In the two decades to 2008, Western bankers, economists and politicians shared a manic culture of denial, omnipotence and triumphalism over the collapse of communism, as they escalated risky
READ MORE... →Predictions: Goldman Sachs lowered Q2 growth estimates to 1.6 percent from 1.8 percent, Morgan Stanley to 1.8 percent from 2 percent, Credit Suisse to 2.2 percent from 2.5 percent. JP Morgan’s expects more Fed action because Bernanke is far from achieving his economic mandate. Median forecast of 70 economists expects the economy to expand at
READ MORE... →Rising truck shipments show economic expansion is intact. The for-hire truck-tonnage index shows 29 months of growth – the economy has never contracted without tonnage turning negative first. The FTR’s index of U.S. truck loadings increase in April from a year earlier, the highest since 2008, shows the economy is expanding. Read the
READ MORE... →Salient to Investors: Home equity in the first quarter rose to the highest level since 2008 as homeowners refinance to pay down principal. Half the mortgages refinanced in the fourth quarter reduced loan size, a record.Predictions: About 23 percent of mortgage holders are underwater on their loans. Predictions: Median forecast
READ MORE... →The financial crisis wiped out 18 years of gains for the median U.S. household net worth, across almost every demographic group, which may hurt retirement prospects for middle-income families. The proportion of families with retirement accounts decreased 2.6 points to 50.4 percent during the period. Read the full article at
READ MORE... →German insistence that EU support be directly to Spain’s government and not its banks had two fatal consequences. Adding to Spain’s public debt and possible subordinating existing bondholders. German taxpayers didn’t want the euro in the first place, correctly fearing it would become a transfer system for other countries’ profligacy. The choice is no longer
READ MORE... →Salient to Investors: Bank of America survey said optimism among global asset allocators has fallen back to the lows of autumn 2011:, equity holdings have been reduced to underweight for the first time in seven months, cash raised to the highest level since 2008 and third-highest level on record. Predictions: RBC Capital
READ MORE... →Decline of shadow banking together with government moves to rein in a national property bubble are crippling small business. Seven out of 10 businesses in the Wenzhou rely on exports, in labor-intensive industries, leaving it vulnerable to Europe’s crisis. Property in Wenzhou remains out of reach for thousands even after home prices slumped 12.3
READ MORE... →Goldman Sachs expects the economy to continue to struggle for the next few months as business owners wait for the national election before making investments. Read the full article at http://www.bloomberg.com/news/2012-06-12/blankfein-says-u-s-economy-in-tough-position-next-few-months.html
READ MORE... →Salient to Investors: Moody’s John Lonski says G-7 bond rates indicate the markets don’t expect economic growth to exceed 3 percent. Blackrock’s Jeffrey Rosenberg says the greed that produces bubbles is absent. Pimco’s Bill Gross says global bond markets are turning ‘Japanese’. UBS’ George Magnus says we are replicating the Japanese experience. Bianco Research’s James
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