Saturday, November 29, 2008

- Barry Ritholtz "The Big Picture"

Friday, November 28, 2008

Housing as of September! - things have turned worse - Since September

Year over year means the prior 12 months 31.9% Phoenix
3.5 the latest month could equal 42%. So, it appears to be
rising at an increasing rate, as it peaks, it should continue
to rise at a decreasing rate - maybe overall, Phoenix will
be -60 to 70% before the blood clots.

Back in 1929 crash, it was said that some Wall Street stockbrokers and Bankers, Jumped from their office windows - committing suicide. People felt sorry for them. In 2008, they had their drivers pick them up, take them to their private planes and holiday for awhile.

Thanks, JLK

Thursday, November 27, 2008

Happy Thanksgiving

This holiday has the most significance of all the holidays for me. Most others are either Religious or celebrating an individual or so. It is so simple a a celebration, that serves nothing else, but the joys of friendship and family. At best the only present given is brought to the table.

"The Pilgrims made seven times more graves than huts. No Americans have been more impoverished than these who, nevertheless, set aside a day of thanksgiving."
~H.U. Westermayer

We are currently going through some very interesting times, the outcome, of which, is uncertain. (uncertain, that's all.) ........"Cowboy up!"

Monday, November 24, 2008


"I sincerely believe that banking establishments are more dangerous than standing armies, and that the principles of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale."
Thomas Jefferson

hat-tip to Brian @ AlphaTrends

How do things look pre-Thanksgiving

This is as of now:
There will be a longer list pre-Christmas
and a very large list post- Christmas

Circuit City (filed Chapter 11)
Ann Taylor- 117 stores nationwide closing
Lane Bryant, Fashion Bug ,and Catherine's to close 150 stores nationwide
Eddie Bauer to close 27 stores and more after January
Cache will close all stores
Talbots closing down specialty stores
J. Jill closing all stores (owned by Talbots)
Pacific Sunwear (also owned by Talbots)
GAP closing 85 stores
Footlocker closing 140 stores more to close after January
Wickes Furniture closing down
Levitz closing down remaining stores
Bombay closing remaining stores
Zales closing 82 stores and 105 after January
Whitehall closing all stores
Piercing Pagoda closing all stores
Disney closing 98 stores and will close more after January.
Home Depot closing 15 stores 1 in NJ ( New Brunswick )
Macys to close 9 stores after January
Linens and Things closing all stores
Movie Galley Closing all stores
Pep Boys Closing 33 stores
Sprint/Nextel closing 133 stores
JC Penney closing a number of stores after January
Ethan Allen closing down 12 stores.
Wilson Leather closing down all stores
Sharper Image closing down all stores
K B Toys closing 356 stores
Loweʼs to close down some stores
Dillard's to close some stores

Saturday, November 22, 2008

So, what's the problem with Deflation?

I write this for my Children:

Businesses will reduce wages - that's not an easy process- it takes time, so for now price deflation will increase borrowing power.For companies with fixed-rate debt, price deflation makes debt more onerous - a fall in the price they can charge for their products lowers their revenues and makes it harder for them to make their loan payments.

We can spiral down the above, what falls first, what falls last, who survives, who fails, what are real interest rates (as inflation is taken out and deflation sets in - probably, and actually, higher) siphon it all down, let all the talking heads do a "work out" on the what ifs - the answer is simple.

The net result is positive (at this time... in our economy...for the survivors.) Wages falling slower than prices result in increased buying power for the consumer - temporarily - 6 to 18 months, maybe. You see... Government Monetary Policy - is not working...not working! Lowering interest rates, flooding the markets with money, boosting up financial businesses, increasing unemployment time limits...not working!

Unintended consequences...a bit of deflation that boosts real wages may be the best way to get American households out of the hole. Remember, reduced wages will take time and resistence, price reductions will be quick and immediate.

Who will survive? Individuals and Businesses who get their houses in order - actually, a cleansing process - a painful result for those who live in disorder, with excesses of one kind or another. - A chapter of Survival of the Fittest. Unpaid Credit Card Balances will fill the morgues with people who loved "poisoned candy" - to an excess.

How to practice. Clean your houses, live with what you have, do without what you want, Look at your money coming in and going out - one is suppose to be greater than the other! Those three will become the foundation of survival.

Did I mention patience? This first decade of the 21st century is now being defined in its 8th year. The "turn" might slowly be recognized in early 2011 and our economy might start to "show" in 2012 -2015. By that time, The Country and The World will look entirely different - let's hope, not like the story (in the book) "The Road" by Cormac McCarthy.

Other Must reads:-
"How We Know What isn't So" - Thomas Gilovich
"The Black Swan: The Impact of the Highly Improbable" -
Nassim Nicholas Taleb

Friday, November 21, 2008

Early Morning in an New Society

"As the cold autumn NYC winds are whistling outside, the hobos roast marshmallows over flaming barrels of garbage. While everyone sleeps in NYC, the sound of sanitation workers spitting on the cold cement run rampant. Janitors are busy mopping the floors of the NYSE, while listening to meringue music—ignorant to what had transpired there the day prior.

In the NYC subways, young criminals are riding the train looking for a few iPods to steal. God willing, they may find someone stupid enough to flash an iphone, if only life were that good.

All around NYC, people scrounge around with hunched backs, worrying about margin clerks and how they will be able to retire off of such little capital. The drug dealers in Washington Heights are upset over the sudden lack of rich white kids, who once flooded their neighborhood in BMW’s, looking for blow.

The mood is somber and the times are desperate.

Once well to do Wall Street bankers find themselves without pay for the 6th consecutive month. And fledgling stock brokers, with an arrogant book of business, are suddenly saddled with large losses and several meetings with the frolicking faggots from FINRA.

In some dark corners of the city, old Asian men sell gremlins to old white guys, in order to put food on the table. And at the local sperm bank, the lines are long and the literature appears worn.

There is a certain seriousness to the city, as men with ski masks flash 357’s on liquor store cashiers and pundits, with oversized heads and undersized brains, crowd the studios of Fox news to say NO to more government bailouts.

At the 24 hour Pathmark, men with bad habits and a lot of debt stock the shelves with peanut butter jars and make sure the produce section is stocked with fresh bok choy, for the old Asian men who enjoy eating it with dinner.

Inebriated single, middle aged, women hurry themselves home, following another night of nothingness. And, at the zoo, the retarded nice goat, named Leonardo, pecks away at Lester the monkey, as if he were made from grass.

And in a far away land, many miles away from where indigenous marshmallow lovers knife each other in the scrotum, over the “nice flaming barrel of garbage,” men eating bok choy are putting a bottom in the world equity markets " The Fly

Thursday, November 13, 2008