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Guest Post: Consumers Are Confident Of Recession

Tyler Durden's picture




 

Submitted by Tony Pallotta of MacroStory.com

Consumers Are Confident Of Recession

And that my friends is the nail in the economic "recovery." August consumer sentiment was just reported at 54.9 from 63.7 in July. This is the lowest level since May 1980. The chart below shows the correlation with sentiment and the consumer component of GDP which is about 70% of the economy and why I say the "recovery" is over.

In Q2 the consumer component of GDP was 0.07% from 1.46% in Q1. Based on historical correlations and today's sentiment data the Q3 consumer component will contract much further in the (2%) range. This will bleed into the fixed investment and inventory components of GDP causing further contraction.

 

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Fri, 08/12/2011 - 10:27 | 1554084 Bam_Man
Bam_Man's picture

I say that comparing "confidence" now with 1980 is apples & oranges.

How many "consumers" were taking anti-depressants in 1980?

Fri, 08/12/2011 - 10:29 | 1554095 Angel Face
Angel Face's picture

I wasn't then....I am now.

Fri, 08/12/2011 - 10:40 | 1554156 Fish Gone Bad
Fish Gone Bad's picture

Comparing apples to oranges is easy.  I generally eat apples when given a choice.

Fri, 08/12/2011 - 10:45 | 1554184 gall batter
gall batter's picture

I'm not taking them.  Just wallowing in my depression and in the depression.

Fri, 08/12/2011 - 17:09 | 1555623 Pay Day Today
Pay Day Today's picture

Part of the healing process. And when you are good and ready, snap out of it and re-engage with life. The world needs more people to do that, the times require it.

Fri, 08/12/2011 - 20:31 | 1556028 samslaught
samslaught's picture

How is it that the democrats get away with saying that a balanced approach is raising taxes and raising spending by nearly 10 trillion over the next 10 years?

As an American I would draw the centrist line at a spending freeze and no tax increase.  I would say leaning to the right would be cutting spending (not reducing from the baseline but actually spending less next year than we did this year) and lowering taxes.  I would say that leaning to the left would be raising taxes and increasing spending.

What Barrack Obama calls for as a balanced approach is actually a leftist dream outcome.  The republican alternative is a leftist dream light.  The mainstream republicans are either too dumb to see this or they are actually in on the scam to increase the size of government while pretending to be fiscally conservative.  In today's enviroment I tend to believe the latter.

Fri, 08/12/2011 - 10:31 | 1554101 SheepDog-One
SheepDog-One's picture

Xanax economic model.

Fri, 08/12/2011 - 10:46 | 1554183 V in PA
V in PA's picture

Didn't have to. You could smoke on planes and at work. Remember kids, smoking is bad. Now take this pill.

Fri, 08/12/2011 - 11:06 | 1554269 eurusdog
eurusdog's picture

 Had not yet discovered the 420 in 1980. Now.......

Fri, 08/12/2011 - 11:11 | 1554275 Don Birnam
Don Birnam's picture

Consumer Confidence the lowest since Jimmy Carter's last summer in the White House. Well done.

The Isley Brothers. Billboard R&B Singles Chart, #1...May, 1980. Prime groove...

http://youtu.be/fj8wufqK59Y

Fri, 08/12/2011 - 11:59 | 1554453 NotApplicable
NotApplicable's picture

Does drinking count?

Fri, 08/12/2011 - 10:29 | 1554091 Aductor
Aductor's picture

How many times must I explain this to you.

1) It is transitory.
2) Conensus was too high.
3) The time period chosen was unfavorable.

Seasonally adjusted, consumer confidence was 99.6. At least.

Fri, 08/12/2011 - 10:48 | 1554200 JPM Hater001
JPM Hater001's picture

Excellent list.  Let me add a few more:

1) Besides earthquakes the Astroid ELEnin also pulled consumer confidence in an unnatural way.

2) Tea Partiers flooded the survey.

3) The college kids were far smarter in 1980...the data is bad.

Fri, 08/12/2011 - 21:07 | 1556118 StychoKiller
StychoKiller's picture

4) The sun was in the poll-takers' eyes!

Fri, 08/12/2011 - 12:05 | 1554466 MacGruber
MacGruber's picture

+QE3

Fri, 08/12/2011 - 10:30 | 1554096 SheepDog-One
SheepDog-One's picture

So whats the market doing now then, last designed hurrah pump before the HUGE Jackson Hole dump within a few hours/days?

Fri, 08/12/2011 - 10:38 | 1554141 glenlloyd
glenlloyd's picture

looks to me like it's trying to establish a holding pattern until JH, that is unless something in Europe implodes.

Fri, 08/12/2011 - 10:53 | 1554218 Oh regional Indian
Oh regional Indian's picture

Indeed SD1, next week is the one it seems. Perhaps a massive break in the eastern markets on Monday morning open, followed by a slew of announcements, measures, interventions, circuit-breakers..... till the US opens that is.
Then, we'll see something incredible. As I'd pointed out before, strong rhymes with August 15th 1971 (also a Monday to boot). And Gold, no good feelings about Gold going into next week.

Moonday morning, it's going to be something.

ORI

http://aadivaahan.wordpress.com/2011/08/04/many-drafts/

Fri, 08/12/2011 - 11:07 | 1554272 SheepDog-One
SheepDog-One's picture

Yea....just incredible to see how totaly controlled and manipulated it all really is. Bankrupt Europe, bankrupt USAA+, but all is well for today while we figure out how to do it all again another day. How about a meteor the size of a school bus slams directly into Manhattan? Sure would cure a lot instantly.

Fri, 08/12/2011 - 11:03 | 1554255 Ratscam
Ratscam's picture

come on guys and girls this news is bullish!

Dealer Broadcast

12 Aug 2011 at 14:49:28 (GMT) Futures Margin Update: With effect on 17 August 2011 @ 2:00PM CET the initial and maintenance margin for D.J. EURO STOXX Bank Index Future(FESB) will increase by 7%, ECX CER Future(CER) by 5%, D.J. EURO STOXX 50 Index Future(FESX) by 18% and SPI 200 Index Future(AP) by 17% and D.J. EURO STOXX Insurance Index Future(FESI) by 2%.

Fri, 08/12/2011 - 11:16 | 1554310 Ratscam
Ratscam's picture

more bullish news

Dealer Broadcast 12 Aug 2011 at 15:15:32 (GMT) Important news 1/2: Following recent market events, the European Securities and Markets Authority (ESMA) have requested a suspension on short-selling on equities in the financial sector from August 12th 2011 for 15 days, covering credit institutions and insurance companies. So far Italy, Spain, Belgium and France have decided to enforce the ban. Sure as hell will I short Reggies French banks next week. 

Fri, 08/12/2011 - 11:18 | 1554321 Ratscam
Ratscam's picture

12 Aug 2011 at 15:16:29 (GMT) Important news 2/2: With immediate effect, it will not be possible to open new short CFD positions in affected companies during this period. Note: existing short CFD positions will be permitted and do not need to be closed. Please refer to your trading conditions in the account menu.

Fri, 08/12/2011 - 11:22 | 1554335 Ratscam
Ratscam's picture

Greece CFDs: Also the Greek securities regulators Hellenic Capital Markets Commission have banned short-selling on the Athens exchange for a period of two months with immediate effect. Clients will not be able to short Greek CFDs until this ban has been lifted. Note: existing short CFD positions will be permitted and do not need to be closed.

 

Why not include the entire world? Or lets ban all leveraged instruments

Fri, 08/12/2011 - 10:30 | 1554097 paul mansfield
paul mansfield's picture

I was wondering if zero hedge stand by their '$2000 quote for gold in less than a month - with near 100% certainity'?

think you lot are top notch,

thanks

Fri, 08/12/2011 - 10:33 | 1554112 SheepDog-One
SheepDog-One's picture

Um, well Zerohedge didnt make that statement, that was a statement from someone else that was posted here.

And that article did not say 'Gold to $2,000 within 1 month', it said some options trades suggest someone believe gold would be that high next year.

Fri, 08/12/2011 - 10:35 | 1554122 Bam_Man
Bam_Man's picture

You sound like an astute investor who may be in a bit of a hurry.

Fri, 08/12/2011 - 10:43 | 1554136 Debt Rolling
Debt Rolling's picture

Zerohedge doesn't make this kind of predictions, it's often just play on the words. 

By the way, if you buy gold to make money, you shouldn't, because you don't understand this product. It's a tool to preserve capital, not to increase it. You will have a bigger purchasing power in wage-dependent products and services, because most people will have become poorer, but it will stay exactly the same (which is already fine) in incompressible things like apples and bread. 

And that's why all the people who comment or rejoice on gold reaching "new highs" are incredibly stupid. Gold does not make new highs. Paper money makes new lows. 

Against gold, but also against wheat or oil. Strangely, I have seen many people talk about a "gold bubble" on forums (even generalist ones), but very few (if any) talk about a CHF bubble or a corn bubble. 

The sheeple has always the same memes, suggested by the medias... 

Fri, 08/12/2011 - 10:58 | 1554233 gdogus erectus
gdogus erectus's picture

Yes, but, but - how about if you park your hard earned money in gold, plant potatoes and store rice in buckets?  Then when deflation hits levered assets such as real estate, you roll your gold over to hard assets at reduced prices?  This will feel like you made an investment rather than just preserved capital.  At this point it becomes semantics.

Fri, 08/12/2011 - 11:36 | 1554370 Debt Rolling
Debt Rolling's picture

Like I said. You become richer relatively (i.e. because the other people become poorer), not absolutely. So you'll be able to purchase far more wage-dependent assets (land, boats, stocks, etc.) but the same number of incompressible assets (i.e. electricity, gasoline, apples, pears, things made by robots, very low margin products, etc). 

You don't "make money", beause in my (very strict and schumpeterian conception of the thing) it would mean being able to buy more incompressible assets also. For example, at the beginning of the month, you have $10 and can buy 10 apples. At the end of the month, you earn your pay of $200 and can buy 210 apples. You have made money. You have more units of currency in your pocket. 

When you put your capital in gold, it's in order to keep the same number of units of currency, not to increase it. 

If you keep your 2011 $210 and decide not to buy apples with it, but rather gold, you'll still have $210 in your pocket (of 2011 value) when you sell it in 2013. 

Which is already incredible: in a negative growth world, the challenge is to preserve your K and not lose it like the rest of the people. 

To "make money", you need to take further steps, and, indeed, buy wage-dependent assets when there is "blood in the streets". But it takes intelligence and guts (you need to buy when everything around you screams apocalypse), and only a few of the current gold bugs will be able to become millionnaires (in today's dollars) through gold. 

Fri, 08/12/2011 - 12:21 | 1554512 The Hawk
The Hawk's picture

So wait... I get what you're saying, but (speaking apples here) I'm thinking since Jan 2004 (random date , $400) apples haven't increased in price by OVER 4x.  I could be wrong, but thinking not... What about banans? over 4x? So instead of $.69/lb now, they were $.16/lb?  Does this mean gold is overpriced?  I own both g and s btw...

Fri, 08/12/2011 - 13:00 | 1554617 Debt Rolling
Debt Rolling's picture

That's because gold has already priced the coming inflation, in anticipation. It's up to you to see if the potential inflation will be higher than what has already been priced in.

Fri, 08/12/2011 - 13:13 | 1554661 Variance Doc
Variance Doc's picture

"When you put your capital in gold, it's in order to keep the same number of units of currency, not to increase it."

I think there is an error in your reasoning.  The idea is that gold is money (ignore what Benoccio claims - he is lying to keep the ponzi going), i.e a store of value, which the USSA dollar is not; it has decreased in purchasing power.  So, you do not in fact have the same number of units of currency at exchange (in the future), but you have increased the number of units.

For example, say in 2010 you have $1 and buy gold with it.  In 2010-2011, the dollar has lost 15% of it's value.  In 2011, you exchange your gold for USSA dollars and get 1.18 back.  It is important to note that we are talking about money and not goods.

Now look at purchasing power.  Let's say that an apple costs $1 in 2010.  In 2011, that apple costs $1.18.  If you held cash, you cannot afford an apple - you're 18 cents shy.  However, if you held gold, you can purchase an apple by exchanging gold for ben/clown bux; thus the presevation of capital.  So, when you put your capital in gold, you preserve the PURCHASING POWER of your capital and not to keep the same number of units of currency.

Fri, 08/12/2011 - 13:56 | 1554858 Strider52
Strider52's picture

Now, lemme get this straight. If I buy a ton of apples NOW, cook them and preserve them using canning methods, they will be worth more a few years down the road? [end stupid comment tag]

Fri, 08/12/2011 - 11:03 | 1554252 youngmanU2
youngmanU2's picture

Spot on

Fri, 08/12/2011 - 11:09 | 1554278 Clearly_Irrational
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Although acting as a store of value is one of the large benefits of owning gold, you'd be mistaken if you think that makes up 100% of the current price.  It's also a fear trade instrument that is negatively correlated with the stock market.  When things go badly people flee stocks and even bonds to gold and treasuries.

Fri, 08/12/2011 - 11:31 | 1554360 Variance Doc
Variance Doc's picture

What DR is referring to is found in the trend and not in the volitility (square root of the 2nd centered moment - the standard deviation) which you speak of.  The trend is the loss of purchasing power of the USSA dollar which is shown in the increase in the price of gold.  You're right if you look at the variation around the trend.

@ DR

Excellent observation!

Fri, 08/12/2011 - 10:40 | 1554157 fuu
fuu's picture

Well I have found that taking the advice of random people on the internet is a great way to make money. I would go all in if I hadn't already spent my money on Lulu, Netflix, Amazon, and LinkedIn like that RoboTrader guy suggested. I just gotta stay long and strong till 8/26 then all of you will be drooling on my Porsche.

Fri, 08/12/2011 - 10:31 | 1554102 JW n FL
JW n FL's picture

There is No! Recession!

BTFD's! Look at BAC! LOOK! AT!! IT!!!

Party on Wayne!

Party on Garth!

People are losing money! by not accepting the new normal training! see the Market go lower! BUY!!

and when the training of the sheep / retail is complete! the FED will NOT! have to add liqudity! the Idiot, Sheepish, Consumers will do it for the FED!

Fri, 08/12/2011 - 10:35 | 1554121 SheepDog-One
SheepDog-One's picture

JW there never was any actual recession, all created chaos by world banksters to soon bring everything back up under their total control with 1 world currency. This is all simply a farce.

Fri, 08/12/2011 - 10:45 | 1554180 JW n FL
JW n FL's picture

I am trying to encourage the blind from participating in the BTFD program!

But yes One World sounds Great too!

where can I sign up??

http://www.youtube.com/watch?v=gTB-LDWoETA

never mind the wigger already signed U.S. ALL up!

But? isnt him being there against the Constitution?

Fuck Me!

Fri, 08/12/2011 - 10:50 | 1554206 V in PA
V in PA's picture

Where do you buy your coffee?

Fri, 08/12/2011 - 11:03 | 1554253 SheepDog-One
SheepDog-One's picture

NAH, I'm trying to encourage them to participate MORE in the FED's 'BTFD program'!

Fri, 08/12/2011 - 17:01 | 1555594 JW n FL
JW n FL's picture

i think we all just want austerity so that the burning starts sonner than later..

better to get this shit over with.

dragging it out is boring!

Fri, 08/12/2011 - 11:51 | 1554422 Max Hunter
Max Hunter's picture

JW there never was any actual recession

Hmm.. reminds me of a conversation I just had with a friend.  I told him trouble on the horizon. He said; "but everywhere I go people are busy". I said; "yeah, they were busy in 08' before the credit crisis too, right?"

Even though we do have fundamental problems, the triger is completely controlled..

Fri, 08/12/2011 - 17:03 | 1555600 JW n FL
JW n FL's picture

i was only funnin! my bad fellow brothers in arms! my bad! i will tone down my crazy fishing posts some. lol

Fri, 08/12/2011 - 10:34 | 1554103 Debt Rolling
Debt Rolling's picture

The "recession" (hate that modern term) itself is not a big event. 

The big event, which would have lasting -- and in fact irremediable -- consequences on the world economy and Zeitgeist is when this recession will, finally, trigger defaults of >medium importance, defaults which would have already happened in 2008 without the tens of trillions USD of government guarantees. 

That's when some real action will start, before that, it's background noise.

Fri, 08/12/2011 - 10:39 | 1554146 BurningFuld
BurningFuld's picture

+1  When governments finally run out of taxpayers money and give up keeping this whole thing afloat.....the real fun begins. Could be a ways off yet...or not.

Fri, 08/12/2011 - 10:34 | 1554118 digalert
digalert's picture

This calls for a Barama/CONgress vacation...

Oh, they're on vacation. Never mind.

Fri, 08/12/2011 - 10:36 | 1554129 SheepDog-One
SheepDog-One's picture

Did you read the article saying AIPAC funds all these politicians vacations? 

Fri, 08/12/2011 - 10:38 | 1554143 Cognitive Dissonance
Cognitive Dissonance's picture

Well, there is always a vacation from their vacation. Don't laugh. I've seen the idea openly discussed.

Fri, 08/12/2011 - 11:56 | 1554440 Max Hunter
Max Hunter's picture

It should be more widely discussed that 81 traitors (I mean Congress clowns) are vacationing in Israel paid for by AIPAC

http://www.youtube.com/watch?v=gGhpQi2JVRE

but of course, all you see on the news is how bad Israel is.. Right?.. Give me a break,,  Sorry to use your comment CD to get this point in open..

Fri, 08/12/2011 - 12:56 | 1554596 RKDS
RKDS's picture

I read another forum where just mentioning that  got some people labeled as anti-semitic.  The next day, they were complainging about Ron Paul and calling him anti-semitic too.  To think, we're supposed to be electing an American president to solve America's problems and some idiots are going to make that decision based on how much the candidate cares or doesn't care about Israel?

Fri, 08/12/2011 - 13:20 | 1554696 Max Hunter
Max Hunter's picture

Always remember, the anti-Semitic term is used to defend what cannot be defended with logic or reason.

Many of the Christians (not most) are far too eager to hate/destroy Muslims. The Jews know this, and use this.  Also, they (the Jews) know how the West is on a guilt trip from the crimes of WWII..  Well.. this is quite the combination. All of this along with a strong presence in controlling public opinion through media and entertainment, well, you have the perfect storm.  And you have people being elected based on their allegiance to Israel.

I should note that the word Zoinist may be a better choice to describe these people. But, in the end, I will be called a racist either way.

Fri, 08/12/2011 - 13:00 | 1554618 citta vritti
citta vritti's picture

fwiw, O stopped by NYC’s lower west side yesterday evening (I guess before heading to MV) for a $40,000/plate fundraising dinner, or so I heard from two of the many, many of NYC’s finest on duty by the barricades. We shared a laugh (easier I think for them) on who was picking up the policing tab for this working vacation visit.  

Fri, 08/12/2011 - 10:36 | 1554126 Cognitive Dissonance
Cognitive Dissonance's picture

I bed to differ. I am confident of a long term depression filled with major and minor recessions and recoveries.

Fri, 08/12/2011 - 10:38 | 1554139 SheepDog-One
SheepDog-One's picture

Im confident that the world central bankster cabal designed every bit of this and is squeezing us into the final solution- 1 world govt, 1 world currency, under central bankster total control.

Fri, 08/12/2011 - 10:37 | 1554134 Kokulakai
Kokulakai's picture

Party like it's 1980?

Fri, 08/12/2011 - 10:39 | 1554145 Long-John-Silver
Long-John-Silver's picture

Party like it's 1929.

Fri, 08/12/2011 - 10:52 | 1554217 V in PA
V in PA's picture

1860

Fri, 08/12/2011 - 10:54 | 1554224 Pchelar
Pchelar's picture

Party like it's July 1914...

Fri, 08/12/2011 - 12:33 | 1554546 caerus
caerus's picture

oct 1929

Fri, 08/12/2011 - 10:37 | 1554135 dwdollar
dwdollar's picture

Rally on bitchez!  Rallyyy on!!!

Fri, 08/12/2011 - 10:49 | 1554165 SheepDog-One
SheepDog-One's picture

WOOT! Wow look at the markets go! And ust think, only a few days ago everyone was convinced there was some dire need for QE! The only debate was how many $trillions it would be to rescue the poor markets and bank stocks higher.

Now, no need at all for QE, WHEE look at em go! Markets FINE, pre-launch checklist A-OK, to the MOON!!!

Fri, 08/12/2011 - 11:00 | 1554249 Oh regional Indian
Oh regional Indian's picture

Monday is Moon Day SD1.

I think everything will run into a giant cheeseball.

At a 100 mph, even water is hard as steel.

ORI

Fri, 08/12/2011 - 10:37 | 1554137 VyseLegendaire
VyseLegendaire's picture

They missed the 2 trillion dollar error.

Fri, 08/12/2011 - 10:38 | 1554142 Long-John-Silver
Long-John-Silver's picture

Lets call this what it really is, a full blown Economic Depression.

The mirrors quit working when the smoke blows away. Welcome the whirlwind.

 

Fri, 08/12/2011 - 10:49 | 1554203 SheepDog-One
SheepDog-One's picture

Sure we're definitely in a depression, but a depression the bankers created.

Fri, 08/12/2011 - 11:12 | 1554288 Clearly_Irrational
Clearly_Irrational's picture

Government created actually, but the bankers happily leveraged it 9:1 with derivatives.

Fri, 08/12/2011 - 10:39 | 1554149 miker
miker's picture

I feel fairly certain that this downturn will be much more severe than the first.  I think most people now have a pretty good idea that the game's up.  After the financial crisis in 08, alot of people put their trust in the 'experts' and government leaders and bought into a recovery of sorts.  But as more and more people have been laid off and tons of small businesses have folded, most people can't stay in denial much longer. 

The only people we know that might still be in denial are secure retirees (government pensions, etc.) that don't have any fingers in the economy except consumption, but any that have grown children are seeing reality through their kids.

Another big difference even over 1980 and certainly the 30's is the internet and availablity of information and analysis that offers much different perspectives and conclusions than the government's story.  This is a signficant factor that I believe has gradually eroded the government's story.  Probably the main reason why the Treasury extended an olive branch to bloggers last year.  They had hoped to build some trust and perhaps influence the tone of the debate.  To no avail though. 

Overall spending can ratchet down hugely from here.  There is still so much "fluff" in our economy.  People can learn to cut back on power usage.  We hang our clothes out to dry and easily save $25-30/month in gas usage.  Vacation cutbacks will happen, school supplies and clothes can be cut even further.  People will start making their own lunch, etc.  There is a huge consumer spending downturn just waiting to happen when folks realize that frugality can be as interesting and challenging as making and spending money.

Fri, 08/12/2011 - 11:04 | 1554262 Oh regional Indian
Oh regional Indian's picture

Very very well put Miker. Excellent!

ORI

Fri, 08/12/2011 - 11:22 | 1554331 BandGap
BandGap's picture

Agreed, Mike.

At street level people are really hunkering down for the long haul.  And the ones who appear to be "secure" are really just part of the glass ALWAYS half full crowd.  I can't tell you how many of my friends have a shoot the messanger attitude when I point out the way the train is heading over the cliff. Blinders.

Personally I will be doing more hunting and fishing, as well as planning for a garden next year.

 

 

Fri, 08/12/2011 - 10:39 | 1554150 paul mansfield
paul mansfield's picture
for the sheepdog: CME Hikes Gold Margins By 22% And Gold Drops by....0.4%, Resumes Climb

 

Just after hitting a new all time high of above $1815 in spot gold, the CME immediately sent out a notice to members advising that gold margins for Tier 1 members were increasing by 22% for both initial and maintenance positions, from $4,500 to $5,500. Unfortunately for the CME, this predetermined move was telegraphed to the market weeks ago, and with rumor 57 out of 22 finally turning out correct, this latest move only managed to push gold down modestly, and at last check was once again trading above $1,800. Just like all central bank interventions, which now have a half life between 1 hour and 4 days max, so this latest exchange attempt to subdue prices will fail spectacularly. Naturally, just like in the case of silver, this will merely embolden the CME to proceed with hike after hike, which in turn will kill speculative elements while merely reinforcing the strong hands. End result: in one month gold will be above $2,000 with almost 100% certainty.

Fri, 08/12/2011 - 10:44 | 1554176 SheepDog-One
SheepDog-One's picture

OK still this is an article observing option activity like I said, and today is the 12th! BTW I never listen to ANY 'on this date in the future, the price of something will = this number'...youd have to be crazy.

Fri, 08/12/2011 - 10:40 | 1554154 Rainman
Rainman's picture

It seems ongoing wealth destruction has a funny habit of ruining people's mood to spend.

Sincerely, Captain Obvious

Fri, 08/12/2011 - 10:40 | 1554155 paul mansfield
paul mansfield's picture

please see above sheepdog.

Fri, 08/12/2011 - 10:44 | 1554179 SheepDog-One
SheepDog-One's picture

Already blew it out of the water buddy. 

Fri, 08/12/2011 - 10:46 | 1554187 AwlDone
AwlDone's picture

Well played, sir. 

Fri, 08/12/2011 - 10:41 | 1554160 ZeroPower
ZeroPower's picture

Markets are pricing in 100% of a mild recession and about 54% for a harsher one - JPM

Fri, 08/12/2011 - 11:09 | 1554276 Rikki-Tikki-Tavi
Rikki-Tikki-Tavi's picture

Really? So there is only about 15% difference in S&P500 between full steam forward and a very gloomy scenario - for a second I feared the impact could have been larger - puh!

Fri, 08/12/2011 - 11:58 | 1554448 ZeroPower
ZeroPower's picture

Its from their proprietary macro & trends insights, but they seemed a bit more gloomy than normal... was on a global strat call a few hours back and they said while company earnings are indeed high (noone can dispute this, simply a fact) - the fact that most sell side shops had 1500 targets on their SPX eoy is way too optimistic. With $100 earnings for the SPX, that slaps a 15 multiple on it. Clearly not a rational target considering the current situation.

Fri, 08/12/2011 - 10:41 | 1554161 LawsofPhysics
LawsofPhysics's picture

Tyler,

 

Don't get distracted by the bad news. Please provide more trading insight.  How do we play this temporary levitation in equities (especially financials) ahead of Jackson Hole?  Do you see the opportunity for some puts in financial equities on the current levitation?  More please.

Fri, 08/12/2011 - 10:41 | 1554163 orangedrinkandchips
orangedrinkandchips's picture

One word...REDEMPTIONS!

Fri, 08/12/2011 - 10:44 | 1554173 digalert
digalert's picture

Oh I'm confident alright.

Democrat CONgress staffers go to Maui on taxpayers dime!!!

http://dailycaller.com/2011/08/12/democratic-hill-staffers-head-to-maui-...

SUCKERS

Fri, 08/12/2011 - 10:46 | 1554189 SheepDog-One
SheepDog-One's picture

The american people dont give a shit while they sit under the tyrants now blatantly ass raping them, they couldnt care any less. thats OK they soon will care when theyre in their new home a FEMA forced labor camp, and no IPhone.

Fri, 08/12/2011 - 10:53 | 1554221 MachoMan
MachoMan's picture

If they really knew what the fuck they were doing, they would have headed to Kauai...  but, if it's on someone else's dime, Maui would do just fine.

Fri, 08/12/2011 - 12:45 | 1554578 I Got Worms
I Got Worms's picture

Hopefully every last one of them inhales a "hot" plutonion particle while sipping umbrella drinks.

Fri, 08/12/2011 - 10:44 | 1554175 Dinho360
Dinho360's picture

Tyler, lay Manufacturing ISM over michigan number. You get the same result.

Fri, 08/12/2011 - 10:44 | 1554177 paul mansfield
paul mansfield's picture

p.s. I think the zero hedge team are outstanding.....just wanted to know their thoughts - they could still be right.  I'll be adding to phy gold position soon enough

sheepdog please get facts right or don't bother.

Fri, 08/12/2011 - 10:47 | 1554194 SheepDog-One
SheepDog-One's picture

'Facts'? Oh, so the month is officially over, and what....youre crying because gold isnt $2,000 yet as you demand? Whatever.

Fri, 08/12/2011 - 10:44 | 1554178 MacroStory
MacroStory's picture

Investment grade debt and swaps would put the SPX at 700-800 right now - http://macrostory.com/?p=6173

Fri, 08/12/2011 - 10:45 | 1554182 Irish66
Irish66's picture

Can you give us a bullet point list of everything, I can't read fast enough.

Awesome job and thank you

Fri, 08/12/2011 - 10:57 | 1554235 V in PA
V in PA's picture
  • Gold
  • Guns
    • ammo
  • Food
  • Fuel
  • Alcohol
  • Etc..
Fri, 08/12/2011 - 11:00 | 1554244 Irish66
Irish66's picture

Ready except need more whiskey aka. moonshine

Fri, 08/12/2011 - 11:00 | 1554248 SheepDog-One
SheepDog-One's picture

Buy lots of Jagermeister, booze always does real well in collapses. I'll keep some dollar bills around in a Ziplock bag for good fire starting material.

Fri, 08/12/2011 - 10:45 | 1554185 GiantWang
GiantWang's picture

If there is a liquidity crisis in Europe which sucks up USD causing a short squeeze in our currency (the least bad option), won't that be very bad for gold?

If the dollar is the least bad option and we face serious issues that require money and a flight to dollars for safety, won't DX go through the roof as gold falls through the floor?

I'm still learning here, guys . . . I own gold and love it, just trying to get a glimpse from different perspectives.

Fri, 08/12/2011 - 10:59 | 1554241 SheepDog-One
SheepDog-One's picture

I guess, as long as you look at gold as just another thing to day trade. Theyll print the dollar to oblivion soon and the dollar will be worthless, and also by then gold will likely be illegal for peasants to hold and trade.

Fri, 08/12/2011 - 10:47 | 1554195 Silver Dreamer
Silver Dreamer's picture

Recession, depression, or whatever you want to call it, none of it matters.  As someone else posted already, it is all background noise.  Until the debt and out of control spending are fixed, things will, without fail, continue to get worse.  Prepare for the worst and hope for the best, right?

Fri, 08/12/2011 - 10:55 | 1554225 SheepDog-One
SheepDog-One's picture

Yep a dead body bounces a little up and down while washing down the river bottom. All just noise. But Im really wondering what Bernank does now going into 'Jacksons Hole'...certainly he cant have a wildly rallying market to make the case for QE3, that BTW has already been cooked into the markets a few times over at least. What will he do? Seems to me this is likely the last big sucker rally before a big plunge in days or hours from now.

Fri, 08/12/2011 - 10:51 | 1554209 pods
pods's picture

Now is this confidence of a recession within the Greater Depression?

Finally people are getting it!

Oh wait, nevermind.

pods

Fri, 08/12/2011 - 10:51 | 1554210 Sandy15
Sandy15's picture

Either way, buy dollars or buy gold WE ARE in a DEPRESSION. It's all going down.  It has been covered up and bloated into government stimulus, bailouts etc....... umm, ultimate kick the can down the road.  As gold goes down, I will buy more.  Only real currency along with silver.

Fri, 08/12/2011 - 10:53 | 1554219 Kina
Kina's picture

This is the only fact that matters now:

 

http://i.telegraph.co.uk/multimedia/archive/01962/gold_1962975b.jpg

 

Fri, 08/12/2011 - 10:54 | 1554222 Byte Me
Byte Me's picture

Confidence you can believe in.

Fri, 08/12/2011 - 10:55 | 1554230 Kina
Kina's picture

Fri, 08/12/2011 - 11:06 | 1554270 teolawki
teolawki's picture

Consumer sentiment plummeting into the abyss just in time for the holiday season. Wonder what those retailer balance sheets are going to look like Q1 2012? Mass layoffs on the way?

Fri, 08/12/2011 - 11:11 | 1554284 Cammy Le Flage
Cammy Le Flage's picture

Why are we all referred to as consumers all the time? And who writes this shit? Better more truthful headline: People know the state of things in the USA friggin sucks. Period. And it is more than just the economy.

Fri, 08/12/2011 - 11:16 | 1554311 Sambo
Sambo's picture

Double dip?

it is now a sliding depression. MSM is just fooling the crowd.

Fri, 08/12/2011 - 11:30 | 1554356 sbenard
sbenard's picture

Consumer CRASHfidence! Sentiment exactly!

Fri, 08/12/2011 - 11:31 | 1554361 youngmanU2
youngmanU2's picture

You want to know the real problem and where it's going? Imo, it's not about the bankers - it's about the government. The reality is, cuts cannot come because the largest voting block in the U.S. is rapidly becoming reliant on government spending: Government employees + welfare recipients (including SS & Medicare).

More likely there will be more Big Government empowerment by increasing taxation with marginal reductions in Gov't spending. And, either way (Big Cuts in Gov't spending or Big Increases in taxes), there will be increased anger in the U.S. and there will come days like London had the last couple of weeks (though our police will have a bit more firepower and, one can only hope, willpower). 

Sorry for the cliche' but, it's a snowball effect.An avalanche of Big Gov't and there really is no stopping it. WFB's "standing athwart history yelling stop" comes to mind. And, of course, there will always be (as there was in the Soviet Union) those who will get around the laws, or manipulate the laws to their advantage (as the evil bankers have done on Wall St.) for short term gains. 

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