Post by unlawflcombatnt on Jul 19, 2007 16:10:09 GMT -6
Once again, Corporate media spin has trumped reality. The Dow finished at 14,000, an all-time closing high, despite the the abundance of negative economic news.
Leading Indicators declined -0.3%, worse than the -0.1% predicted at the beginning of the week. The Leading Indicators index has a cumulative 6-month decline of -0.7%. ( a 6-month decline of over -1.0% is 1 criteria for for a recession alarm).
The Philadelphia Manufacturing Index declined much more than predicted, declining from 18 in June to 9.2 in July. (The prediction was for a decline to only 13).
Below is a modified copy of the downward trend in Leading Indicators, taken from Briefing.com
The subprime meltdown is only getting worse. Holders of securities backed by subprime loans have already experienced major losses, and those losses will only worsen as the downgrading of the ratings of those securities has only just started.
The Housing Industry is already in severe recession, with no bottom in sight. Home equity extraction, and the spending financed by it, is only beginning to decline. This decline will only get worse.
The recent expansion of consumer credit, due in part to expanded credit card limits, will come to an end as credit tightens and subprime financing of anything will end. Consumer credit expansion has largely obscured the spending decline from falling home equity extraction.
Real wages are declining, reducing aggregate consumer spending power. And there is nothing on the horizon to put upward pressure on American wages or employment. With declining real wages, and declining borrowing ability, there is nowhere for consumer spending to go but down. And with 70% of our economy being consumer spending, there is nowhere for our economy to go but down.
Despite the obvious, the delusional optimists continue to espouse an alleged "strong" economy, and continue to dump their money into the stock market.
This truly is a faith-based, hot air economy. Eventually, however, reality will trump faith and hot air. And our "faith-based" economy will become a "fate-based" economic disaster.
Leading Indicators declined -0.3%, worse than the -0.1% predicted at the beginning of the week. The Leading Indicators index has a cumulative 6-month decline of -0.7%. ( a 6-month decline of over -1.0% is 1 criteria for for a recession alarm).
The Philadelphia Manufacturing Index declined much more than predicted, declining from 18 in June to 9.2 in July. (The prediction was for a decline to only 13).
Below is a modified copy of the downward trend in Leading Indicators, taken from Briefing.com
The subprime meltdown is only getting worse. Holders of securities backed by subprime loans have already experienced major losses, and those losses will only worsen as the downgrading of the ratings of those securities has only just started.
The Housing Industry is already in severe recession, with no bottom in sight. Home equity extraction, and the spending financed by it, is only beginning to decline. This decline will only get worse.
The recent expansion of consumer credit, due in part to expanded credit card limits, will come to an end as credit tightens and subprime financing of anything will end. Consumer credit expansion has largely obscured the spending decline from falling home equity extraction.
Real wages are declining, reducing aggregate consumer spending power. And there is nothing on the horizon to put upward pressure on American wages or employment. With declining real wages, and declining borrowing ability, there is nowhere for consumer spending to go but down. And with 70% of our economy being consumer spending, there is nowhere for our economy to go but down.
Despite the obvious, the delusional optimists continue to espouse an alleged "strong" economy, and continue to dump their money into the stock market.
This truly is a faith-based, hot air economy. Eventually, however, reality will trump faith and hot air. And our "faith-based" economy will become a "fate-based" economic disaster.