Empiric Student Property Share Discussion Threads

[briarberry] 11/6/2009 16:26

The U.S. Census Bureau said Retail Sales improved a bit more than expectations in May, recording a 0.5% monthly gain, compared with the market forecast of +0.4%.. Since May 2008, retail sales have fallen 9.6%.

Some analysts said the details were less optimistic than the headline, which was lifted in part from rising gas prices.

[briarberry] 10/6/2009 14:16

US exports still falling

worldwide demand contracted further as exports fell 2.3 percent from last month

[briarberry] 09/6/2009 14:33

Could California become the first state in the nation to do away with welfare?

That doomsday scenario is on the table as lawmakers wrestle with a staggering $24.3 billion budget deficit.

[briarberry] 09/6/2009 14:33

strange might be a mistake ?


Redbook reports a colossal plunge in same-store sales for the June 6 week, down 4.4 percent year-on-year and down 4.3 percent compared to the full month of May. The 4.4 percent plunge is not comparable to anything Redbook has been posting this cycle. And the magnitude of the week-to-week change in the year-on-year rate, to -4.4 percent vs. +0.1 percent in the May 30 week, is also unprecedented. The removal of Wal-Mart from Redbook's sample may be behind the movement (Wal-Mart's gone into hiding) as is no doubt year-on-year comparison problems with last year's tax rebates. The latter factor, however, doesn't explain the -4.3 percent comparison with the full month of May. The text is very mild, citing cooler weather for the decline as well as the stimulus checks. It will be interesting to see Redbook's report next week.

[briarberry] 09/6/2009 14:10

German exports fell 28.7% in April compared with April 2008, according to the Federal Statistics Office.

Exports fell to 63.8bn euros ($88.5bn; £55bn) from 89.5bn euros in the same month last year. Imports fell 22.9% to 54.4bn euros.

It was the biggest fall since the recession began

[briarberry] 08/6/2009 22:32

Commercial Loans to Bear Brunt of Future U.S. Bank Losses

McKinsey expects the US banking and securities industry to incur losses averaging $125 billion per quarter through 2010, with the bulk of it concentrated in commercial banking loans.

McKinsey research estimates that total credit losses on US-originated debt from mid-2007 through the end of 2010 will probably be in the range of $2.5 trillion to $3 trillion, given the severity of the current recession. Some $1 trillion of these losses has already been realized, McKinsey says in a review of the banking industry.

[briarberry] 08/6/2009 18:15

still buying US$s...


June 8 (Bloomberg) -- The BRICs are buying dollars at the fastest pace since before credit markets froze in September, protecting exports even as leaders of the biggest emerging markets consider alternatives to the U.S. currency.

Brazil, Russia, India and China increased foreign reserves by more than $60 billion in May to limit currency gains as the first global recession since World War II restricted exports, data compiled by central banks and strategists show. Brazil bought the most dollars in a year, India's reserves gained the most since January 2008 and Russia added the most foreign exchange since July.

While Russian, Chinese and Brazilian leaders suggest substituting the dollar, the central bank purchases show just how dependant they remain on the world's reserve currency. Russia is proposing the BRICs consider creating a new unit of exchange when they meet in Yekaterinburg on June 16. China and Brazil said last month they may look at ways of dropping the dollar for trade between the two countries.

[briarberry] 08/6/2009 02:03

I wonder if it's really him...

Eliot Spitzer is the former governor of the state of New York.

[briarberry] 06/6/2009 23:22

Benefit spending soars to new high, highest since 1929...


The recession is driving the safety net of government benefits to a historic high, as one of every six dollars of Americans' income is now coming in the form of a federal or state check or voucher.

Benefits, such as Social Security, food stamps, unemployment insurance and health care, accounted for 16.2% of personal income in the first quarter of 2009, the Bureau of Economic Analysis reports. That's the highest percentage since the government began compiling records in 1929.

In all, government spending on benefits will top $2 trillion in 2009 - an average of $17,000 provided to each U.S. household, federal data show. Benefits rose at a 19% annual rate in the first quarter compared to the last three months of 2008.

...
We're not seeing the hunger we saw in the 1930s (people starved in the 1930s)

Food stamps. Enrollment hit a record 33.2 million people in March, up 5.2 million from last year. The stimulus law boosted the size of the benefit. Average March benefit: $114 per person.

[briarberry] 05/6/2009 20:11

3:00 U.S. April consumer credit down $15.7 billion
3:00 Decline in consumer debt 2nd largest on record

Heavily underscoring the trouble is a steep downward revision to the prior month, now down $16.6 billion vs. an initial $11.1 billion decline

(consumption is 70% of GDP, I guess this means the recession is getting worse)

[briarberry] 05/6/2009 16:08

initial and continuing claims...


I have a feeling that in the not too distant future the continuing jobless claims numbers are going to start "improving" due to a negative effect - let me explain. Unemployment benefits are limited: the standard is for up to 26 weeks of insurance benefits. There are currently Federal programs offering an extension of 13-20 additional weeks.

The markets like to focus on the jobs report, which releases two main numbers:

The number of first time jobless claims - this is a measure of new unemployment - how many people are filing for unemployment for the first time in the week in question.
The number of continuing jobless claims - this is the total number of people collecting unemployment.

Well, it seems obvious to me that as we extend our fiscal problems, many people will exhaust their unemployment benefits - they will drop out of the continuing claims number NOT because they have found a job and are going back to work, but because things are so bad that they have used up their benefits and will no longer be counted in the statistics. Of course, this makes the continuing claims number smaller, and leads to chatter of "green shoots" in the job force.

The United States Department of Labor publishes statistics on the "exhaustion rate" - this is a measure of the number of people who have used up their benefits, and will no longer be receiving unemployment checks. I took it upon myself to run some numbers based on their data, and produced the chart below



I'm not sure if "parabolic" is a strong enough word to describe the current upswing (a record!) in the exhaustion rate. Again - this is why economists who refer to what "typically happens in a recession" are spouting nonsense - this is clearly not a typical recession.




continuing claims are already at a record high

This graph shows weekly claims and continued claims since 1971.

Continued claims declined slightly to 6.73 million after increasing for 19 consecutive weeks. This is 5.0% of covered employment.

Note: continued claims peaked at 5.4% of covered employment in 1982 and 7.0% in 1975. So this isn't a record as a percent of covered employment.

[briarberry] 05/6/2009 13:38

Total Nonfarm Birth/Death Adjustment + 220,000 jobs

U.S. NONFARM PAYROLLS DROP 345,000; JOBLESS RATE OF 9.4% HIGHEST SINCE 1983

However, the unemployment rate surged to a slightly higher-than-expected 9.4 percent from 8.9 percent in April.

[briarberry] 05/6/2009 00:24

Sweden is preparing to part-nationalise banks exposed to the economic collapse in Baltic states

It is unclear whether Sweden's bank troubles are the first sign of broader strains for West European banks, which have lent $1.6 trillion to the former Communist bloc. Sweden's exposure to the region at 22pc of GDP is not the highest. Austria's exposure is 70pc of GDP, with $246bn outstanding in Central Europe, Ukraine and the Balkans.

[briarberry] 05/6/2009 00:22

GM

The Center for Automotive Research estimates that even if the GM and Chrysler bankruptcy processes go as smoothly as possible, there will be 63,000 permanent job losses this year related to the bankruptcies, followed by another 179,000 next year.

And if GM and Chrysler have trouble emerging from the bankruptcy process, 1.3 million more jobs could be lost this year and an additional 446,000 in 2010, according to the study.

...
Millions of jobs still tied to Detroit

The auto industry doesn't employ as many people as it did during the Big Three's heyday. But even after years of plant closings and downsizing, the industry is still a major source of U.S. jobs.

There are 677,000 people working in auto plants and auto parts plants in the United States, according to the government's April reading. Another 1.1 million work in auto dealerships.

While the 1.7 million working directly for the industry is down 23% in just the last two years, it's still more than employed by many "healthier" industries, such as software development, computers and semiconductor manufacturing or legal services.

In addition, many other industries also depend heavily on the auto business. Tech companies manufacture semiconductors used in car engines, for example. Truckers move parts and finished cars while carpeting companies make interiors for vehicles.

Many of those indirect suppliers will probably not get paid due to the bankruptcy filings, which in turn could result in cutbacks in employment beyond auto plants, according to experts.

[briarberry] 04/6/2009 22:54

quote


In this version, Latvia appears to be leading the way, much as Thailand did (IIRC).

Pretty much the whole Warsaw Pact will see devaluation, the same way East Asia saw it a decade ago. It may take time to play out, but it's inevitable. Both regions accumulated excessive debt denominated in foreign currency that they discovered they cannot earn and service. Same story for Latin America in the early 1980s. Same story for Argentina a decade ago. Same story... same story... same story.

[briarberry] 04/6/2009 22:24

The new printonomics, bailout bubble economy...


from SyHardingBlog.com

General Motors has filed for bankruptcy this morning, with the government providing an additional $30 billion in loan guarantees. The U.S. government will wind up owning 60% of 'Government Motors', the Canadian government owning 12%, when GM eventually emerges from bankruptcy hugely downsized.

In its current euphoric mood, the market now thinks this giant bankruptcy is a positive for the economy, along with soaring job losses, soaring mortgage foreclosures, the return of spiking oil and gasoline prices, rising inflation, etc.

More than 1,300 car dealers have gone out of business voluntarily over the last 12 months due to the hardships created by the recession, contributing to the huge losses of jobs. And now GM will permanently close 11 of its manufacturing plants, and temporarily close 3 more, while dropping more than 1,000 of its dealers.


Banks owe investors a huge thank you.

The Wall Street Journal reports this morning that the major banks involved in the government stress tests have raised at least $85 billion in just the last four weeks by selling additional shares to investors.

The Journal quotes one executive at a bank that recently raised capital through a public stock offering as saying, "It's easy to raise capital now. Investors are happy to gobble it up."

They also quoted William Mutterperl, a former vice-chairman of PNC Financial Services Group, as saying, "I'm an optimist by nature, but it's perplexing because there are still problems out there. No one has suggested foreclosures are going down, and I don't think anyone is saying loan quality is getting any better."

[briarberry] 04/6/2009 22:02

Overall, retailers' May same-store sales fell 4.8% from last year.

Wal-Mart Stores Inc. was conspicuously absent from the May sales figures. As expected, the world's biggest retailer is no longer reporting monthly numbers. This impacts consensus data that tracks overall consumer sentiment in the sector. (sign of weakness)

Macy's also reported total sales of $1.74 billion for the four weeks ended May 30, a decrease of 9.5% compared with total sales of $1.92 billion in the four weeks ended May 31, 2008.

Costco said that same-store sales fell 7% while total sales fell 5% to $5.47 billion from $5.77 billion in the year-earlier month.

Children's Place Retail Stores Inc. reported a 9% drop in same-store sales.

...
American Eagle reports its same-store sales fell 7% in May, Abercrombie & Fitch sales down 28%, BJ's Wholesale Club down 6.8%, Dillard's down 13%, The Gap down 6%, Nordstrom's down 13.1%, The Limited down 7%, JC Penney down 8.2%, Saks down 26.6%. Target down 6.1%.

(70% of GDP)

[briarberry] 03/6/2009 15:43

May ADP Employment Change -532K, April revised to -545K from -491K
April Factory Orders +0.7%, prior revised to -1.9% from -0.9%

[briarberry] 03/6/2009 01:22

Foreign Central Banks - The fears that FCBs will abandon the Treasury market continue to prove unfounded. FCBs again pumped cash into the US markets last week, adding to both their Treasury and Agency holdings for a third week in a row. However, the amount was much less than the average of recent months. Total Fed FCB custodial holdings of Treasuries and Agencies rose by $4.4 billion in the week ended 5/27, on top of rises of 22, 35, and $13 billion in the 3 prior weeks. Treasury holdings were up by $7.9 billion. Agency holdings were down by $3.5 billion.



but yields are still rising, and even more debt is to be sold next week

[briarberry] 02/6/2009 00:33

The Fed's total MBS holdings are now $427.5 billion.

[briarberry] 01/6/2009 21:39

give us your money...

American Express selling $500 mln in new stock
J.P. Morgan plans to raise $5 bln in common equity

June 1 (Bloomberg) -- The 19 largest U.S. banks will have to demonstrate they can sell new shares before they are allowed to repay their government stakes, the Federal Reserve Board said today.

[briarberry] 30/5/2009 22:07

the quality of loans is deteriorating at the fastest pace ever, according to statistics released this week by the FDIC

an unprecedented volume of old-fashioned loans going bad

Of the entire book of loans and leases at all banks - totaling $7.7 trillion at the end of March - 7.75 percent were showing some sign of distress, the F.D.I.C. reported. That was up from 6.9 percent at the end of 2008 and from 4.1 percent a year earlier. It also exceeded the previous high of 7.26 percent set in 1990 and 1991, during the last crisis in American banking.

The F.D.I.C. has been collecting the figures since 1984.

...
Over all, 8.77 percent of real estate loans are troubled, but some types of such loans are in far worse shape than others. Construction and development loans are in the worst shape, with 17.68 percent of loans troubled, and loans secured by farmland are in the best shape, with only 2.98 percent of such loans reported as having problems.

One area that could get much worse is loans on commercial buildings, including stores and offices. Just 4.01 percent of such loans are troubled, less than half the peak of the early 1990s. A large number of those loans will need to be refinanced in the next few years, however, which could be impossible where real estate values have fallen sharply.