Use access key #2 to skip to page content.

alstry (36.32)

Alstrynomics leads the way......

Recs

12

January 24, 2009 – Comments (7)

Over a year ago.....Alstrynomics was warning you about the pending explosion in unemployment.

As we look back at what has transpired over the past couple years we see the following:

Auto sales DOWN 40%.

New Home Sales DOWN over 66%.

Japansese Exports DOWN over 35%.

Steel Production at one of Japan's key producers DOWN over 40%.

What is amazing about these numbers is that they are absolute.  After having conversations with a number of individuals in the past few weeks......a few trends are becoming very clear.

Travel will be REDUCED dramatically in 2009.

Salaries will be FROZEN or REDUCED in 2009.

Bankruptcies will EXPLODE in 2009.

Vacancy rates will be double digits in 2009.

The most misleading statistic will be the REPORTED unemployment rate.  We learned from the NYTimes that only 270K people were counted as unemployed but over 600K dropped out of the workforce due to extent of time looking for a job.  That means that almost 3X as many people who would have been considered unemployed are now no longer counted.

Extrapolating it to its reasonable conclusion....that means if we used traditional methond of counting unemployed....we would be well into the double digits right now probably approaching 15%.

Again, based on industry after industry shrinking by 30, 40, and 50%.  Nobody should be surprised by a 25-30% unemployment reading BEFORE the end of the year.

Under Obama new tax plan, 52% of Americans will not pay any income tax.  That means the burden of tax responsibilty will be focused on fewer and fewer.  The problem is that those fewer are now making less so even they will be paying less taxes.  Government will simply not be able to generate enough revenues to make up for Americans losing their jobs.  As a matter of fact, despite what Obama is saying, jobs will likely have to be cut by government at EVERY level.

Fools used to make fun of the Alstrynomic projections....now even the recession resistent sectors are cutting jobs by the thousands day after day......round and round she goes.....where she stops nobody knows.......but at this point we are not even close.

For those of you Fools that think the government is printing money....you are dead right.....for those of you that think TOTAL money supply is growing......you don't know how to count TOTAL money.  M1, M2 and M3 is only a small fraction of TOTAL money.  I know what they taught you in school, but your professors missed a lot.  That is why I developed Alstrynomics.  There is a much larger percentage of money that is never counted in those figures that is evaporating at a much faster rate than the government is printing. 

As soon as government printing starts to exceed money evaporation, Alstrynomics will make an INFLATION projection......until then it is DEFLATION as far as the eye can see.

 

7 Comments – Post Your Own

#1) On January 24, 2009 at 11:01 PM, alstry (36.32) wrote:

California will lead the way.  It is about 10% of the total US population.  The state is basically broke.  It can't afford to pay taxes refunds it owes its citizens and will likely run out of money by the end of next month.

As more and more employers contract workforces, fewer and fewer will be left to pay taxes.  It is a double edged sword as those without jobs will not be paying taxes and simutaneously taking funds through unemployment.  The rate of contraction will only accellerate as the revenue shortfall gap rips wider and wider.

From the WSJ:

California's unemployment rate jumped to 9.3% in December -- the state's highest level in 15 years -- as employers in the nation's most populous state cut 78,200 jobs during the month.

California's jobless rate rose from 8.4% in November, according to the state Employment Development Department report, released Friday. More than 1.7 million of the state's 37 million residents were unemployed last month, up by 650,000 since December 2007.

Construction took the biggest hit but job losses were across the board, said Howard Roth, chief economist for the state Department of Finance. California's jobless rate, which has been among the highest in the country, could hit 11% this year, Mr. Roth said. "We're hoping see some signs of stabilization by the end of the year, and not much sooner than that," he said. "We're still going to be pretty weak in the first half of 2010."

Friday's report underscores the severity of the recession in California, where the housing market has been in the tank for more than a year. The news comes as Gov. Arnold Schwarzenegger and state legislators feud over plans to close a projected $42 billion deficit, caused largely by decline in tax revenues. Mr. Roth said the rising unemployment rate aggravates the budget deficit, which will rise "if we keep getting [unemployment] reports like this."

The budget crisis has already forced a state board to freeze funding for more than $3 billion in construction projects. The state controller said that, starting Feb. 1, it will begin delaying, for 30 days, payments of tax refunds and welfare checks, among other things, unless state leaders quickly reach budget solutions.

Those people waiting for their tax refunds or welfare checks will not be able to spend further exacerbating the slowdown.  At some point, as revenues continue to shivel away, all you FOOLS will realize that the whole country is broke and we need to restructure.......the only question now is how will we be restructured????

Report this comment
#2) On January 24, 2009 at 11:29 PM, racer675 (< 20) wrote:

What the heck are alstrynomics? I'd be interested in reading more.

Report this comment
#3) On January 25, 2009 at 12:56 AM, kaskoosek (37.09) wrote:

Alstry

 

I think the economy is in very bad shape.

I just hope you are right regarding deflation, but I wouldn't bet on it.

Report this comment
#4) On January 25, 2009 at 1:04 AM, boiler1117 (< 20) wrote:

racer675   -->  You don't know what alstrynomics is?  Unfortunately for you, alstry did not include his definition in this particular post, which he does in 95% of his posts.     He pitches it in a very childish way most of the time too.   Not saying I disagree with aspects of his comments, just that you can read other gloom and doom analysts and get more out of it.   

Report this comment
#5) On January 25, 2009 at 1:21 AM, alstry (36.32) wrote:

Kas,

Here is a blogger that actually gets it......and I think he is a gold bull as well.......

http://globaleconomicanalysis.blogspot.com/2009/01/is-big-inflation-coming.html

Report this comment
#6) On January 25, 2009 at 5:35 AM, mliu01 (< 20) wrote:

alstry, my friend.

 I have this article to share with you.

 

http://www.safehaven.com/article-12403.htm

my friend. good luck. Open your mind a little.

 to have meaningful deflation, us dollars has to worth more.

it is impossible when most in US are broke. it is impossible when us govt is broke and owe massive debt to foreigners.

Deflation means americans have to worke their butt off to pay back the debt owed by foreigners.

Inflation means Americans will make the debt worthless. And inflation is great for americans

Only good thing about this is that american owe the debt in USD not in yen or yuan or eve euro. Meaning we control out destiney. That means we can make USD worthless. I am sure we will do it.

Report this comment
#7) On January 25, 2009 at 7:58 AM, kaskoosek (37.09) wrote:

mliu01

Do not even bother. Reason will not work with Alstry.

He has too much pride for that.

Currencies have easily fallen prior to the gold and silver standard. Now that they are backed by hot air and no longer by production, shiny rocks seem much more attractive.

It will take some time, but people will realize that currencies are no longer safe havens.

 

Report this comment

Featured Broker Partners


Advertisement