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Americans’ urge to shop is overriding anxiety about the economy.
Today’s Data & journal links
Data sheets describing major market metrics, news and a journalling area for trading records in the centre of the pdf.
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News and Views in brief
Economy
Americans’ urge to shop is overriding anxiety about the economy.
While household-sentiment measures are at levels typically observed during a recession, an increase in spending during the third quarter boosted growth to the highest level of the year, Commerce Department figures showed Oct. 27. The schism partly reflects consumer ire with the government’s failure to reduce 9.1 percent unemployment or stem rising deficits, said James Paulsen, chief investment strategist at Minneapolis-based Wells Capital Management.http://www.bloomberg.com/news/2011-10-30/economy-improving-as-u-s-consumer-shows-what-s-done-refuting-what-s-said.html
European governments are running into initial resistance as they seek to use this week’s Group of 20 summit to turn early praise for their revamped crisis- fighting strategy into financial support.
The G-20 leaders convene Nov. 3-4 in Cannes, France, a week after euro-area authorities pledged to magnify the capacity of their rescue fund to 1 trillion euros ($1.4 trillion) and look beyond their borders for help in doing so as they combat the debt turmoil posing the biggest threat to global growth.
While the help of China and cooperation of the International Monetary Fund were immediately sought, pledges of hard cash are proving hard to come by as G-20 members press for more details of the plan. In an indication Europe may eventually prevail, Brazilian and Russian officials said their governments may be willing to provide assistance. http://www.bloomberg.com/news/2011-10-31/europe-seeking-crisis-fighting-funds-faces-resistance-before-cannes-g-20.html
Hopes for a bounce in Britain's ailing economy were dealt a blow on Monday after data showing a slowdown in mortgage lending alongside a modest pick-up in unsecured lending highlighted the tough conditions faced by hard-pressed consumers. http://uk.reuters.com/article/2011/10/31/uk-mortgage-approvals-idUKLNE79U01O20111031
Indexes –
U.S. stock futures fell, indicating the Standard & Poor’s 500 Index will trim its biggest monthly rally since 1974, on concern European leaders will struggle to raise funds to contain the region’s debt crisis.
Morgan Stanley and Citigroup Inc. dropped more than 1.8 percent, following declines in European lenders. Alcoa Inc. and Ford Motor Co. slumped at least 1.1 percent to pace losses in companies most-tied to economic growth. Chevron Corp. erased 1 percent, while SanDisk Corp. decreased 2.5 percent after analysts slashed their recommendations for the shares.http://www.bloomberg.com/news/2011-10-31/u-s-stock-futures-drop-as-europe-woos-china-for-bailout-fund.html
European stocks dropped, paring their biggest monthly gain since July 2009, as some investors remain reluctant to buy equities before the euro area’s leaders explain how they will fund their expanded bailout facility. U.S. index futures and Asian shares fell.
The Stoxx Europe 600 Index slid 1.1 to 246.19 at 12:21 p.m. in London, paring its monthly gain to 8.8 percent, the largest advance in more than two years. The gauge slipped 0.2 percent on Oct. 28, having rallied 3.6 percent the previous day, after the euro area’s leaders said they will boost the European Financial Stability Facility’s capacity in a bid to stem the debt crisis. The gauge jumped 4.2 percent last week, its fifth straight weekly gain. http://www.bloomberg.com/news/2011-10-31/european-u-s-stock-futures-decline-vestas-may-drop-barclays-may-move.html
Currencies
Currency markets were in risk aversion mode on Monday, but investors were limited in their choice of havens after intervention to weaken the yen by Japan left the dollar as the only safe bet. Indeed, the US currency was up 1.1 per cent to $1.3987 against the euro and gained 0.7 per cent to $1.6006 versus the pound.
Riskier currencies saw deeper losses. The Australian dollar, sought out under conditions of stronger risk appetite for its higher yield, fell 1.5 per cent to $1.0552. The dollar index, a measure of the dollar’s strength relative to a basket of six other currencies, gained 1.3 per cent to 76.037.http://www.ft.com/cms/s/0/7193770a-03ac-11e1-bbc5-00144feabdc0.html?ftcamp=rss#axzz1cMZhGdji
The US Dollar Index was broadly under pressure on account of overall optimism over the solution to the European debt crisis. Better recovery from the United States too was favourable for high-yielding currencies.
The European banks were downgraded, which hardly shocked market participants as investors knew very well that European banks are poorly placed due to the mounting debt on their balance sheet.
Despite risk aversion, the markets rallied as all this news was fairly priced-in and the greenback was under immense pressure throughout the fortnight.
http://www.moneycontrol.com/news/rupee/fortnightly-outlook-for-currencies-nirmal-bang_607944.html
Commodities: -
World equities fell on Monday after commodity shares were hit by a stronger dollar which jumped in the wake of Japanese intervention to weaken the yen, while returning doubts over the EU's plan to solve the debt crisis added to the cautious tone.
U.S. crude futures also fell, by 0.8 percent, as the dollar hit a three-month high, making commodities priced in the greenback more expensive for investors holding other currencies, cooling demand.http://www.reuters.com/article/2011/10/31/us-markets-global-idUSTRE79N45620111031
Oil fell in New York on speculation demand will falter after the biggest monthly gain in more than two years and a surge in the dollar. Brent’s premium to U.S. crude was near its lowest in almost four months.
Futures fell as much as 1.2 percent after Japan took steps for the third time this year to weaken the yen against the dollar, making commodities priced using the U.S. currency less attractive to investors. Crude prices at $80 to $100 are “reasonable,” the United Arab Emirates’ energy minister said in Singapore today. Oil is up 17 percent in October, the biggest monthly increase since May 2009. http://www.bloomberg.com/news/2011-10-31/oil-declines-paring-biggest-monthly-increase-since-may-2009.html
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I love my wool
What he said...plus barbed wire,radios, bear traps, body armor, solar set ups etc.
...got Militia?
Can any economy comprising 70% consumer consumption (Mostly cheap shit manufactured in China with jobs exported from the US by the United Corporatocracy), and, based on credit which is now deleveraging, be expected to be sustainable in the longer term?
Perhaps if America would actually do something or make something that the rest of the world might actually be interested to buy (Other than cheap shit manufactured in China with most of the profits shifted by the United Corporatocracy to offshore tax havens to avoid paying any taxes in the US), the future might actually be brighter?
We make military and then blow some other bitchez up with it.
True, and I suspect most people liked your repetition of "cheap shit manufactured in china", because let's face it, it's easier to kid yourselves and demonize somebody else's slaves than reflect on your own faults. Cheap shit, expensive shit, whatever shit from China are manufactured by joint ventures, and the vast majority of the profits on each unit American consumers buy, end up in the pockets of American importers, American wholesalers, American distributors, and American retailers. Over the past 25 yrs, the slaves of China have made more millionaire Americans in the supply chain than at any other time in its history, and as a consequence the disparity between the haves and have-nots have also rocketed at the same time. It isn't all in finance. As for manufacturing, the military industrial complex is doing a roaring trade - where do you think much of that $14T GDP is coming from? I'd bet the Arms fairs and the new cyber warefare agencies in the private sector will be rolling in the money this year and the next.
There's an awful lot of hateful crap flung at the Chicoms on ZH, almost daily, and the comments are getting more inflammatory. As the economy worsens, I am pretty sure the animosity will get even worse until some American-Chinese guy in SF whose ancestors built the continental railroad is beaten to death or has his home torched by a nutjob who is incited daily by the msm and the internet racists. In the late 19th and early 20th centuries, there were mobs of white Californians who ethnically cleansed So-Cal of Chinese people, even rewarding murderers with bounties. In the SF earthquake of 1906, the government reports of casualties did not include the hundreds or even thousands (Nobody knows) of Chinese dead, because nobody gave a shit. It looks like things have not changed much. Human nature. We are often more cruel to those we have wronged.
Driven out: The forgotten war against Chinese Americans
http://www.ucpress.edu/book.php?isbn=9780520256941
A recent article on ZH noted that consumer spending rose 2.4% during the third quarter, yet at the same time the Bloomberg Consumer comfort index fell to -51.5, meaning that 95% of those asked had negative opinions on the economy. Here's what I had to say about that, and it is still pertinent to this article:
"So they are still shopping, just not enjoying it.
The American has historically been the most vociferous devotee of consumerism the world has ever seen. Habits and conditioning are very hard to break, so they are still going to the malls to spend money they neither have nor earned on goods they neither need nor use. The mall rats have become the mall zombies, wandering the empty aisles often dragging their screaming spawn in search of that-thing-we-saw-on-tv, to fill their shopping bags with ipods and itampons that are poor substitutes for the gaping holes in their empty hearts and empty minds. "
I don't think the average American dislikes Chinese people, I think they fear China. They probably assume the average Chinese is much like them, concerned with family and work. But Americans see videos of Chinese cooking cats and dogs, boiling them alive and stripping their skin. They hear about Chinese eating all manner of endangered animals in order (usually) to stimulate libido. Unborn kids are eaten. Women with a single child who become pregnant again are hunted down and have forced abortions (rape and murder?) Mobile 'death vans' are used, with summary judgment. There are millions of people in gulags, many for thought crimes. Religious persecution is rampant. The Chinese government is communist and has never abandoned the doctrine - what's happening there now is part of the historical inevitability of things, part of the path to the all-powerful state. They murdered or caused the starvation (same difference) of millions of their own people. And there's a warranted suspicion that they're busy cooking up whatever they can in their genetics labs, creations unrestrained by any moral or social standards. They're a police state and an alien culture which does not seem to respect many of the things we do, such as basic freedoms and many advanced forms of life. So they're scary, and anyone who says otherwise is a fool. That doesn't mean we can't commerce with them, and share wisdom with them, but I think we are crazy to have intertwined our destinies to such a degree.
awesome
Agreed without hesitation.
Absolutely most of the profits go to americans rather than the.chinese laborers.
There is a perception among most of the world now that china doesnt play fair, with poison toothpaste in panama, poisoned milk, poisoned baby formula, plastic rice, lead painted toys, and most fake medications and faked mechanical parts that intentionally dont meet specs come.from china. The chinese steal from everyone their business secrets and engages in rampant copyright and patent abuse and see nothing wrong with it.
The majority of emerging markets and developed markets have at least one trade complaint against china. My Vietnamese friends tell me that in vietnam as well as most of Asia shoddy chinese goods are despised.
The chinese now have to hide country if origin for many products or they wont sell. They have justifiably earned the worlds wrath as thieves and cheaters who would poison your kids milk and toothpaste for a profit.
Nonetheless no one promotes bashing individual chinese who have nothing to do with the system. China needs to work on their business reputation not just with the usa but the entire world.
TY +10
second that. THe largest threat to the American way of life, is the American way of life.
Can any economy comprising 70% consumer consumption
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No. US economics are one hundred per cent consumption. No conservation in it. Even what is labelled conservation is only consumption in disguise.
You are confusing the value attached to the various acts of consumption.
Alas for you, that US citizen perception is just as biased as most US citizenish things.
Consumption is consumption and it is not because you value that 30pc consumption share more it means it is sustainable consumption.
Good luck then. Keep on keepin on consuming and borrowing 40 cents on every dollar spent. But of course you would contend that the dollar will always be there. It just might not be worth very much?
Putting words in other's mouth. US citizen favourite sports...
Remain in your US citizen group and all will be well. Dont fall on the wrong side of the US world order, you will be immediately eaten by your former US citizen chums...
One other factor I noticed when I was in the United States, is that Americans have little confidence that if they save, the money will be there in the future. There was a feeling that, if they don't spend it now, someone will steal it or seize it, perhaps some lawyer in America's legal mafia, in a divorce case or lawsuit; some sudden medical emergency for which they have to pay; some asset confiscation as part of some legal or police trouble.
The feeling of Americans I noticed, is that it is better to spend it now, and enjoy it; if 'saved' it just might get seized or stolen or grabbed, and there will be no enjoyment at all.
In 'socialist' Europe, people feel much more secure long-term about savings and assets, surprisingly enough.
"that Americans have little confidence that if they save, the money will be there in the future. There was a feeling that, if they don't spend it now, someone will steal it or seize it"
I would disagree. They simply believe the good times will roll on forever. If they had no confidence in US currency, they would be saving in PM's and other tangible assets, and would have built up savings in non-dollar assets so when the dollar tanked they had something to draw on. The bottom line is that the majority of americans are simply stupid. End of story.
"if 'saved' it just might get seized or stolen or grabbed, and there will be no enjoyment at all."
Then why do they put money in 401Ks, IRAs and buy into company pension plans?
"In 'socialist' Europe, people feel much more secure long-term about savings and assets"
Huh? What planet are you living on, Or was this an attempt at sarcasm? Since the Sovergn debt crisis has unfolded, PM sales have been very strong in the EU. Why are the majority of Europeans rioting in the streets in virtual every EU nation, if they are feel much more secure?
One other factor I noticed when I was in the United States, is that Americans have little confidence that if they save, the money will be there in the future.
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No. US citizens have lauched a game of consumption and are well aware of it.
In a game of consumption, when the goal is to consume as much and as fast as you can, immediate consumption is much better than postponed consumption.
The feeling is not that they are going to be robbed of it, it is simply that US citizens know that there might nothing left to consume if they dont consume immediately in a game of consumption.
Events like Black Fridays (with no Black Saturdays following) show that US citizens are perfectly aware of the rules of the game they are playing. Nothing to do with the government seizing their assets or something. On the contrary, the US government has fully supported and enabled US citizens in their little game of consumption.
Why does your ftard country keep subsidizing US consumption? Surrounded by bitching cowards, are you?
hee hee
http://www.salon.com/2011/10/31/is_chinas_bubble_bursting/
There is some of that to be sure. For example, the costs of sending your kid to college is a function of whether you have saved any money to send your kid to college. Universities have a baseline tuition that is reduced by a variable amount of financial aid and/or grants from the Government and the university itself. The amount of aid you receive goes up if you have no assets (being unemployed is even better).
UT Austin tuition+fees+books now $24000+. That's a state school, and that's in-state. Out of state: $47000+. Lunatic looting on a massive scale.
Maybe it's because they don't have a pot to piss in? In regards to irresponsible taxpayer spending, I'm not sure American and Europe are distinguishable. When you throw firebombs on cops to keep your pensions and free lunches, I'm not sure how secure you really feel about your savings and assets...
To err is human, to shop is divine
or perhaps:
To shop is human, to return it is divine.
I had a friend who when young indulged frequently in shopping therapy, having grown up poor and fatherless, she would buy things she didn't really need or could afford, just to be in the crowd; to bask in the warmth of salespersons attention.
Buyers remorse would soon engulf her as she knew her credit card debt was already out of control, and she would feel immense relief when she returned her purchases the next day.
If by "shopping", they mean buying gold and silver, then yes, my anxiety over the economy has caused me to "shop" more.
is unallocated like layaway?
If this is the definition of shopping, since last year my shopping increased +infinity%. United as one, divided by zero.
Probably because of the new iPhone coming out........amazing to see folks line up in mass to get them at the mall yesterday. Do chicks blow you if you have one or something? Is this the new status symbol? Back in my day, it was a Benz or Bentley, or Rolex or some shit like that.
Do chicks blow you if you have one or something?
There's an app for that.
LOL. Best post of the day.
Americans are always encouraged to shop after every terrorist attack...
Total bullshit. Margins have been crushed and inflation is now grossly under-reported. People are paying more, not buying more.
And some people are stocking up. I know people that are adding $600/month in food to their stocks. Spam ('long pork') sales way up.
old habits die hard.
Ever heard about price inflation?
They're buying more? Really? Or are they just paying more? And what are the stats on savings and foodstamps again?
Oh well, another lemming falling for fancy official stats and propaganda. Bullish on bullshit.
Even the ironies have less metal in them
Rice and beans are going up considerably.
As is Peanut Butter!!