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New Vehicle Sales “Collapse” And Pending Home Sales “Plunge” As America’s Economic Slowdown Accelerates

September 28, 2018

New Vehicle Sales “Collapse” And Pending Home Sales “Plunge” As America’s Economic Slowdown Accelerates

In late 2018, the bad economic news just keeps rolling in.  At a time when consumer confidence is absolutely soaring, the underlying economic numbers are clearly telling us that enormous problems are right around the corner.  Of course this is usually what happens just before a major economic downturn.  Most people in the general population feel like the party can go on for quite a while longer, but meanwhile the warning signs just keep becoming more and more obvious.  I have been hearing from people that truly believe that the economy is “strong”, but if the U.S. economy really was in good shape would new vehicle sales be “collapsing”?…

According to the latest estimates released by Edmunds, new vehicle sales for September are expected to collapse both on a monthly basis and year-over-year basis. The company predicted that 1,392,434 new cars and trucks will be sold in the U.S. in September, which makes for a estimated seasonally adjusted annual rate (SAAR) of 17 million. This will be a 5.4% decrease from last month and an 8.3% drop from September of last year.

Those are absolutely terrible numbers.

And this news comes after all of the major automakers had already revised earnings guidance lower.  The following comes from Zero Hedge…

The drop in sales capped another rough month for the auto industry during which Detroit’s carmakers all revised their earnings guidance lower and Ford embarked on a five-year restructuring plan. Earlier this week, we reported that Ford’s CEO claimed that President Trump’s auto tariffs had cost the company $1 billion in profits.

Sadly, this may just be the very beginning of the auto industry’s troubles.

…click on the above link to read the rest of the article…

Peter Schiff: ‘We Are Seeing A Lot Of Warning Signs’ Of A Financial Crisis

August 16, 2018

Peter Schiff: ‘We Are Seeing A Lot Of Warning Signs’ Of A Financial Crisis

Just like the financial crisis of 2008 which investor Peter Schiff accurately predicted, there are warning signs again that are being ignored.  “We are seeing a lot of warning signs people should be worried about, but again they’re dismissing them, much the way they did 10 years ago,” Shiff said.

Schiff is known for his “doom and gloom” market predictions, yet he’s been spot on in the past.  And our current debt-based system is unsustainable to the point that asevere global economic crisis is imminent – we just don’t know when the global bubble will burst. Once again, Schiff is trying to warn people, because the signs are there, but who’s listening?

“We’re seeing a lot of warning signs people should be worried about, but again they’re dismissing them, much the way they did 10 years ago. You know, we’re getting close to the 10-year anniversary of the 2008 financial crisis. Remember, the whole thing started in August of 2008. Here we are August 2018, 10 years later. I think we’re heading for an even bigger crisis and the same people are even more clueless.” –Peter Schiff

A big problem that could compound the next financial crisis is one Schiff continues to point out: Americans are flat broke. Wages have been stagnant especially in the face of inflation. Rising interest rates will also harm those already living paycheck to paycheck.  There are a lot of people buying stuff on credit. In fact, the entire economy is built on working-class debt and a system which transfers wealth to the elites from the workers. 

…click on the above link to read the rest of the article…

Van Halen, M&Ms, And The Next Market Downturn

September 3, 2017

Van Halen, M&Ms, And The Next Market Downturn

How watching the right indicators will avoid disaster

The planet-sized egos of rock & roll performers are legendary.

Few things symbolize this better than the outrageous requests they often make when on tour.

These requests are referred to as “riders”, and appear in the contract a tour venue receives in advance of the artist’s arrival. These contract riders specify the physical conditions that the singer/band requires to be in place before arriving to perform. Stage lighting settings, sound equipment, furnishings, etc — that kind of stuff.

And these rider requests can get pretty funky – often extremely so — when it comes to backstage perks the performers want.

For example: A wooden pond filled with koi carp (Eminem). A driver who will not speak or make eye contact (Katy Perry). 20 white kittens and 100 doves (Mariah Carey). Seven dwarves (Iggy Pop). 50,000 bees (Slayer). A sub-machine gun (Mötley Crüe). And, yes, even a great white shark (Hank III).

The practice of making these kind of outrageous demands stems from a rider Van Halen inserted into the contract for its 1982 world tour, which insisted on a bowl of M&Ms to be provided backstage, but with all of the brown M&Ms removed.

As this image below of the actual rider shows, the band was very explicit in its seriousness about this:

Once the media got whiff of this, it had a field day roasting the band’s narcissistic chutzpah. A new high-water mark of diva capriciousness had been established, which quickly became legend. A feat of prima donna pampering that subsequent performers have been trying to top ever since.

But as crazy as it sounds, Van Halen’s “no brown M&Ms” rider had nothing to do with caprice. There was a solid rationale behind it.

In fact, it was quite brilliant.

 

…click on the above link to read the rest of the article…

This Bubble’s Days Are Numbered—–Market Tops Are Sprouting Up Everywhere

September 26, 2015

This Bubble’s Days Are Numbered—–Market Tops Are Sprouting Up Everywhere

I have an important update regarding how far we could see the market drop in the short days and weeks ahead…

I’ve been warning for months that it looks like this bubble may finally be peaking.

I’ve warned that it’s best to get out of stocks a little early rather than a bit late. That’s because, when bubbles finally break, they burst rapidly – as much as 40% in the first few months. It can make markets very volatile, up and down, hence harder to predict and adjust to. If this is indeed the end, we’ve only taken the first step down a long ladder.

In retrospect, the odds keep going up that we saw a major long-term top on May 19.

The first warning sign was that, as stocks made little progress from late December into May, we saw a series of major tops around the world. And that to me is no small matter.

Dow Transports peaked in late November and are down 20% since.

Dow Utilities peaked in late January and are down 18%.

The German DAX and British FTSE both peaked in April and are down 24% and 19%, respectively.

The Dow and S&P 500 appear to have peaked in late May. The Dow’s down 16% since then.

Then in June came China’s Shanghai Composite index – one of the leading dominoes to fall – and it’s crashed 42%. The Russell 2000 index also peaked in June and is down a little more than 12%.

And finally, our Nasdaq, which peaked in late July, is recently down 21%.

Four of those are undeniably in bear territory. The Shanghai, DAX, Nasdaq and Dow Transports have crossed that 20% threshold that literally defines a bear market. A drop like that only raises the chances that a bubble is finally over. But thus far technical indicators only show that the Shanghai and DAX have peaked for good.

And all of this is just the first warning sign…

 

…click on the above link to read the rest of the article…

Deflation, Debt and Gravity

August 6, 2015

Deflation, Debt and Gravity

Far too many people have already used lines like “We Are All Greeks Now” for the words to hold on to much if any meaning by now. But it’s still a very accurate description of what awaits us all. Just not for the same reasons most who used it, did.

No, I don’t really want to talk about Greece again. I want to talk about where you live. And about how similar the two will be not too long from now. How Greece is holding up a lesson and a big red flashing warning sign for all of us.

Greece is the mold upon which all of our futures will be based. Quite literally. Greece is a test tube baby rat.

Greece will never “recover” to our North American and Western European economic levels (if ever they were there). Instead, it’s us who will descend, “uncover” so to speak, to the levels Greece is at today. That is baked into the cake, that is inevitable, and that is therefore what we need to be ready for.

If we wake up in time to this new reality, we may, and that’s still only may, be able to prevent the worst, prevent something akin to the same punitive measures the Troika has unleashed upon Greek society, fully wrecking it in the process, its healthcare system, the safety nets for its most needy.

We may find a way to make a smoother transition from here to there if we prepare in time. But that’s the best we can do. As societies, that is; individual fates will vary.

…click on the above link to read the rest of the article…

 

 

6 Warning Signs That the Economy Is in Trouble

August 5, 2015

6 Warning Signs That the Economy Is in Trouble

On July 14, I wrote about the danger developing in the transportation sector, and things are looking even worse today. Here’s what I mean:

Look Out Below #1: Royal Dutch Shell reported its quarterly results last week—$3.4 billion, down from $5.1 billion for the same quarter a year ago—and warned that “today’s oil price downturn could last for several years.”

In anticipation of tough times, Shell slashed its 2015 capital expenditure budget by 20% and is going to lay off 6,500 high-paying jobs (not Burger King-type jobs) this year.

Look Out Below #2: UPS is a very good barometer of the consumer end of our economy: It’s the largest component of the Dow Jones Transportation Average both by sales and market valuation.

And UPS isn’t very confident about the US economy. Here is what UPS CEO David Abney said in a recent conference call with analysts:

If you just look at in [sic] January, the GDP forecast we thought was going to be about 3.1%. Now the thinking in July is about 2.3%, so let’s say a pretty significant decrease.

Why so glum?

The continued strength of the US dollar and I think this impending rate hike by the Fed appears to be holding back some US growth.

Abney has good reason to complain: UPS’s revenue fell 1.2% over the last 12 months. Not good.

Look Out Below #3: Rolls Royce may be best known for its luxury limousines, but the heart of its business is making engines for jet airplanes. Along with General Electric, the company dominates the aerospace engine business.

Business isn’t so good. Rolls Royce just issued its fourth profit warning in the last year and a half and is shutting down its $1.56 billion share buyback, introduced a year ago, to conserve cash.

 

 

…click on the above link to read the rest of the article…

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