Archive - May 22, 2009

Submitted by John Bougearel of Structural Logic

Structural Logic 5.22.09 -

One of the core macroeconomic themes that Zero Hedge has been expounding on since inception, which mirrors some of the major concerns of David Rosenberg, has been the evaporation of consumer wealth, income and equity as a function of both declining stock and real asset values and persistently high consumer debt. In an economic paper, the San Francisco Federal Reserve confirms that these concerns are not unfounded, and could be the very core of the processes that undermine the administration's attempts to restore economic growth.

One of the core macroeconomic themes that Zero Hedge has been expounding on since inception, which mirrors some of the major concerns of David Rosenberg, has been the evaporation of consumer wealth, income and equity as a function of both declining stock and real asset values and persistently high consumer debt. In an economic paper, the San Francisco Federal Reserve confirms that these concerns are not unfounded, and could be the very core of the processes that undermine the administration's attempts to restore economic growth.

[youtube=http://www.youtube.com/watch?v=2IU3iE8nC2M&hl=en&fs=1]

Barbara Ehrenreich, blogger and author of This Land is Their Land, has added her name to the list of 3,270 people endorsing Ron Paul's and Alan Grayson's campaign to audit the Federal Reserve.

Also adding their names are:

The Bureau Of Labor Statistics' Mass Layoff Events statistic indicates that the wholesale firing by corporations is accelerating once more again after a small respite in the January to March period. The BLS defines a Mass Layoff Event as one that occurs when an establishment has at least 50 initial unemployment compensation claims filed against it within a five-week period and the layoff lasts longer than 30 days.

The Bureau Of Labor Statistics' Mass Layoff Events statistic indicates that the wholesale firing by corporations is accelerating once more again after a small respite in the January to March period. The BLS defines a Mass Layoff Event as one that occurs when an establishment has at least 50 initial unemployment compensation claims filed against it within a five-week period and the layoff lasts longer than 30 days.

And, as always, the VWAP is the low intraday bound.

And, as always, the VWAP is the low intraday bound.

And, as always, the VWAP is the low intraday bound.

Quantitative Easing is dead and buried. The bond curve just hit a steepness that was last seen in October... not of last year but of 2003. The rush for near duration is accelerating as investors are running away from the 10 year like a herd of rabid buffaloes. If this continues it will destroy any plans for providing cheap 30 year mortgages. The alternative: make near durations unattractive to the point where banks start losing money from the curve flattening.

In a flagrant example of chasing the marginal buyer as others offload their shares, Morgan Stanley just came out with a research piece which upgrades the price targets of virtually all banks by 33% on average (better known as stratospheric escape velocity).

In a Detroit Free Press article, long suffering Delphi has been reported to be in active negotiations with the auto task force over its own upcoming June 2 deadline to emerge from bankruptcy.

An attorney for Delphi says talks with members of President Barack Obama's automotive task force continue in hopes of reaching a deal to lift the auto supplier out of bankruptcy protection.

Treasuries tumble (but wait, there was nothing to fear in the rating agency posturing we thought... or maybe there was)

Gold takes off (this is not the hedge fund driven wholesale plundering you are looking for)

Treasuries tumble (but wait, there was nothing to fear in the rating agency posturing we thought... or maybe there was)

Gold takes off (this is not the hedge fund driven wholesale plundering you are looking for)