Doesn't it seem some days we HP'ers know what's going to happen before it happens?
As we've discussed for months and months, the housing crash and it's associated issues will now crash the US economy and GDP.
Millions of REIC will go unemployed, the debt spigot will be turned off, wild spending via HELOC's will dry up, the negative savings rate will reverse, and the consumer-based US economy will now dramatically slow, first into recession and then into who knows what to call it.
Are you ready?
Housing market hinders economic growth
Economic growth slowed to a crawl in the third quarter, advancing at a pace of just 1.6 percent, the worst in more than three years.
The latest snapshot of the economy, released by the Commerce Department on Friday, showed that the slumping housing market figured prominently in the economy's dramatic loss of momentum. Investment in homebuilding was cut by the biggest amount since early 1991.
The reading on gross domestic product was weaker than the 2.1 percent pace many economists were forecasting.
"The housing bubble burst and that really knocked down growth," said Joel Naroff, president of Naroff Economic Advisors.
Treasury Secretary Henry Paulson struck a similar note. He said the housing boom over the last five years was "clearly unsustainable".
36 comments:
The dependence of foreign central banks on the dollar will defer its crash, but it won't prevent it. Today's snowdrift will become tomorrow's avalanche. The masses of snow are already accumulating at breathtaking speed. The avalanche could happen tomorrow, in a few months or years from now. Much of what people today think is immortal will be buried by the global currency crisis - perhaps even the leadership role of the United States
Next up...Fed Rate Cuts...
TJ,
Inflation is a worry still and growth of the economy comes in second behind that.
How do y'all feel about deflation?
Dear Blogger:
It's sounds like your joyous about what is happening to America.
People are insane if they think the worst is behind us. This is just beginning.
I feel no joy, I am pissed that bad leadership got us here. Again no joy in Mudville.
"It's sounds like your joyous about what is happening to America.
"
Yeah, sure am! And about time too!
Next...
The only joy I have is that Hastert was just touting how wonderful the economy is and how the stock market is up and this is the current news. Can't wait for that fat crooked dork to be getting his but investigated when the Dems are in charge.
Can't wait for that fat crooked dork to be...
You can't say fat crooked dork on this blog, there might be chitlins reading this.
metro,
yah man. cuz we know if kerry and the dems were in charge they would be perfectly honest about the state of the economy.
/end sarcasm
did you even read the article?
the dems are blaming it on bush's tax cuts...lol.
they are just as clueless man.
McGraw Hill WSJ says construction to pull down economy. . .hey - we coulda told them that one year ago!!!. . .Alls I know
(as they love to say in Canton OH
) is that people are still out at the shopping centers, but it is beginning to look like George Ramero's "Dawn of the Dead" (by the way, one of the greatest parable movies ever made. . .Keith - maybe find a video clip of "dead people" out shopping. . .
Mike I read it. Where's the problem. As for Kerry at least democrats are competent, not like these guys wait for the investigations, Sunlight is the best disinfectant. "republican" will be used as an epithet like "liberal" is now.
"The avalanche could happen tomorrow, in a few months or years from now. "
Or twenty years from now. Like Keynes said "In the long run, we are dead". Somebody else said that markets can stay irrational far longer than we can stay solvent.
Our culture is conditioned by 15 second TV commercials and 90 minute "epic" movies that tie everything up in a neat ending. The real world operates on a different schedule. The Fed and other central banks have proven conclusively that they are experts at muddling through so-called financial crises. I personally am hedging my bets so that I'll preserve some capital come doom or boom.
2008 will be very interesting.
The housing market is definitely past Denial and full on into Fear.
About the rest of the economy, the vapid talking heads like Larry Kudlow and George "sunny nobility" Bush crowd are still firmly swimming upstream in Denial River.
They watch those logs swimming by and think "boy, those pessimistic bubble-blogger liberals see crocodiles behind every Bush!'
2008 will be very interesting.
-----------------
your correct, we should be in the "Mission Acomplished" phase of the things.
Clinton & Bush 2 of the worst presidents ever to flatuate in the oval office.
borkafatty -The avalanche -Great article at lifeaftertheoilcrash.net entitled "America and the Dollar."
Everyone on this site should look it up and read it. We're screwed -BIG TIME!!!
Borka,
I think Clinton did a way better job than this guy but history will tell. All I know is that if Hillary runs in 2008 the talk is that her husband might be on the ticket as VP. I think that would get her elected, because as all those conspiracy nuts in the Clinton Crazy Camp "know" he could have her whacked like Vince Foster.
I did not have sex with that cadaver... (really, not lying this time, wags finger)
But former Federal Reserve Chairman
Alan Greenspan told a Washington audience on Thursday that the economy will rebound after going through a "very weak patch" this summer.
"Most of the negatives in housing are probably behind us but we still have a way to go" before hitting bottom, Greenspan said. "We have too much inventory still."
Inventories of both existing and new homes did drop slightly in September but remain close to all-time highs.
------------------
Is this guy on crack or what?...anyway Clinton, yes was a much better motivational speaker of sorts, but he also sold the house to China, and North Korea, so Bush did inherit that mess.
And we can blame Bush for the current Fiscal mess we are in right now...and it is folks an F"EN mess. Those Bush Tax cuts did not and have not worked, to late to roll them back tho, we are still in Political Denial.
When the sheep wake from their stoop, then and only then will the masses realize what has happend.
Personally over and above the obvious, I am more worried about the layoff's that are coming..look what has happend over the course of 2006, and fast, faster than we all realized..read some of the back logs, 07, is for sure going to be a major MAJOR! transition.
Again this is hoping We do not have any kind of military confrontation..then as Keith has noted with his Pic art, the roller coaster is one big hill downward.
The GDP was in fact inflated by auto sales- and will be weaker when revised. Also the 4th quarter will be weak now- soft landing? We shall see.
---------------
I bet those HELOC bought Big screen Tv's and Haley Davidsons, and closet full of unworn shoes and clothes are looking pretty shitty right about now..whats that saying?
"No why the Fu@k did i do that"
But hey Exxon is having a Helluva quarter: Thank You SHEEP!
Exxon posts second-biggest profit ever
Second-largest quarterly gain ever posted by public company.
http://www.msnbc.msn.com/id/15426390/
Shawn of the Dead is better.
JUST WAIT FOR THE FIRE HOSES TO
GO FULL BLAST. WE SHOULD START
A POOL FOR WHEN THE DOLLAR BREAKS
80.0. I'M IN FOR DEC 15. YOU
HEARD IT HERE.
-MAHA
Metroplexual said...
TJ,
Inflation is a worry still and growth of the economy comes in second behind that.
Friday, October 27, 2006 6:21:24 PM
....
Yeah, and if you believe that one, I have a few pre-construction condos to sell ya. The Fed's job is to "manage" inflation, not stop it, but "manage" it. Which basically is a code word for create it.
Inflation is a debtor's best friend. And I have an uncle who owes about $44 trillion...
Got Credit?
TJ,
I saw what they did in 1982 in the name of killing inflation. Alot of people were unemployed because of it.
Oh---that 1.6% GDP growth (much below 'expectations') was jimmied up artificially by the blowout at cheap prices of craptastic US trucks at cheap prices.
Last quarter's annualized 26 percent increase in auto production shocked Joe Carson, now director of economic research at AllianceBernstein LP in New York. Without the gain, the economy would have grown at an annual rate of 0.9 percent, not the 1.6 percent the Commerce Department reported today.
The reported increase in output came despite cutbacks announced by General Motors Corp., Ford Motor Co. and others. A drop in the wholesale price of SUVs and light trucks as the automakers cleared leftover 2006 models made production look stronger than it actually was, said Carson. The economic fallout from the auto-industry cutbacks will instead come this quarter, he said.
http://www.bloomberg.com/apps/news?pid=20601087&sid=ad2YPx3XGEW4&refer=home
metroplexual,
Ahh yes, Volcker's rate increases. That could happen again, but not in an environment of stalled wage inflation and slowing economic growth like we have now. And, even with Volcker raising rates to double digits, they were still increasing the M3 money supply the whole time, which is the prime driver behind the inflation they were supposedly fighting.
GDP growth has been in the negative for few years if you take inflation into account. It's now harder to show growth with housing going dow, RE related jobs getting axed, and inflation. brace.
Get rid of legal tender laws and you will get rid of inflation. The government should not choose our currency.
But, the populace is debased, so why shouldn't the currency be debased as well. It happened in Ancient Rome and it's happening in the Western World today.
See the pretty green dollar?
You 'w a n t' the pretty green dollar... don't you?
Now shut up, drink the %^&$ Kool-Aid, and go buy a house or something!
Thank you,
I.N. Cumbent
David M. Walker - head of the Government Accountability Office, an investigative arm of Congress that audits and evaluates the performance of the federal government...if the United States government conducts business as usual over the next few decades, a national debt that is $8.5 trillion could reach $46 trillion or more, adjusted for inflation.
A hole that big could paralyze the U.S. economy; according to some projections, just the interest payments on a debt that big would be as much as all the taxes the government collects today.
And every year that nothing is done about it, Walker says, the problem grows by $2 trillion to $3 trillion.
http://tinyurl.com/tohtt
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