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alstry (35.42)

How Bad Is It? "Ridiculous"

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March 15, 2008 – Comments (3)

Banks At or Near Insolvency

Hedge Funds Insolvent and Liquidating

Major Real Estate Deals Defaulting

Residential  Home Foreclosures at Record Highs

Corporate Executives Bonused after Eliminating Shareholder's Dividend and Destroying SH Value

Govt says CPI flat when Gas at $4.00 p/gal, milk at $5.00 p/gal, and bread at $4.00 p/loaf  wheat

Municipalities on the verge of Bankruptcy

Counties on the verge of Bankruptcy

State Tax Revenues Declining Rapidly Forcing Cutbacks

Retailers Shutting Down Stores Around the Country

Commercial Vacancies Rising

Home Prices Crashing

Layoffs and Unemployment Increasing

Oil Over $110 per Barrell

Doller Below 100 Yen

Euro Over $1.56 Dollar

Import Prices Exploding

American Median Income Declining

Population Aging-Pension Funds Under Funded

Over 40 Million Americans Uninsured

Animal Shelters Overflowing with Abandoned Animals

Food Shelves Overflowing with Needy People-Especially in Suburbs

Our President Says We are NOT in a Recession

On Monday the CEO of Bear Stearns said it was "ridiculous" that anyone would think it was facing a liquidity issue.  On Friday.......enough said.  Think about the above facts as symptoms of a patient presenting with an illness.  America has never had this much of a debt burden, especially at the individual and governmental levels, supported by soooooooooo little income.  

What happens to a nation when its thinks its economy is booming simply because of a credit bubble from borrowing so much money?   Not only that, during the illusion the nation spends trillions prosecuting foreign wars, allows its infatructure to deteriorate, ships jobs and manufacturing overseas, and is left with a service economy importing goods and servicing each other.  It seems Mr. Spitzer took advantage of the situation.....but all in all, at least he had pretty decent taste.

Maybe President Bush is right, America is not heading for Recession.  This could be the first time history that America goes straight from Boom to Depression. 

 

3 Comments – Post Your Own

#1) On March 15, 2008 at 3:50 PM, Tastylunch (29.29) wrote:

1929 sure seemed like Boom straight to depression.

 Bush=the new Hoover. will clinton or Obams be the new FDR? 

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#2) On March 15, 2008 at 11:01 PM, alstry (35.42) wrote:

As some of you know, I have been sounding off on HBs overbuilding spec homes and the consequential damage dumping those homes is doing to our citizens and nation.  Those builders that are responsible and have stopped building specs and not dumping, then no problem.  It appears the main stream press is starting to take notice on the theme and consquences.

 

Is Suburbia Turning Into Slumburbia?

What do all these places have in common? Suburbs upon sprawling new suburbs. Does this suggest that the American dream of the large-lot single family home is doomed? Some experts think so.

"Over the last few decades we've structurally overinvested in fringe real estate," explains Christopher Leinberger, a visiting fellow at the Brookings Institute and a former developer.

 "Builders are experts in overbuilding, in terms of cyclical overbuilding, like lemmings to the sea. But this time it's different. It's not just a cycle. It's going to take more than two or three years to recover from this."

Newer suburbs are also financially vulnerable: They depend on developers' fees and property taxes to pay for the communities. "When the growth stops and the property values fall," says Leinberger, "suddenly you're going to have this wicked situation where social costs are rising as funding dries up, but without any other tax sources from commercial or industrial activity."

http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2008/03/14/carollloyd.DTL

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#3) On March 15, 2008 at 11:31 PM, alstry (35.42) wrote:

My Headline:

Margin Calls Everywhere

March 14, 2008

 

WSJ Headline the next day:

Debt Reckoning: U.S. Receives a Margin Call

March 15, 2008; Page A1

The U.S. is at the receiving end of a massive margin call: Across the economy, wary lenders are demanding that borrowers put up more collateral or sell assets to reduce debts.

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