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B4 the Bell, Moonday, July 12, 2004


Guest yobob1

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Guest yobob1

Beadrech>> " ..cash register with windows." :lol: "wait for the moss on the for sale signs". Might be a long wait in Arizona. If the Western drought, or the resumption of a more normal long term water pattern if you will, continues and indeed accelerates, then much of the Southwest cannot be maintained as it is. All of the dams, canals and pipes won't do a damn bit of good if it just quits falling out of the sky. There was probably a damn good reason that there weren't large populations of Native Americans in that region before the white folks showed up. And that reason was likely the natural carrying ability of that area determined by rainfall.

 

Doc>> Buy with an ARM when rates are high and prices are low. Sage advice for normal times. IMO these and future times are and will be anything but normal. I think multiple magnitudes of super cycles are coming into synch and geared for a long sustained down slope. I'm not talking purely financial here, but on all levels of humanity.

 

Personally, I sold my house in October of 2002 when I felt that the resale potential of my particular adobe (location, condition, size, price range) was near it's peak. So far I haven't been wrong. In our market there is a constant supply of new developments of what I refer to as "Vinyl Blight", priced right in where the majority of the resales live. That in itself pretty much caps resale values. Rents in our market are still stagnant to falling when the incentives are considered, and I don't think a mass exodus from foreclosures will do anything to change that. You need better credit to rent than you do to buy. Why? Likely because the people who own the rentals are far more concerned with getting their money than the schmuck at the mortgage center is, since all he really cares about is finding a market for your loan so he can collect his fees, no matter what it takes, legal or otherwise.

 

Will I buy again? Yes. When? When I can buy the house I want to live in long term can be bought with a small percentage of my cash. When will that be? Hey I'm psychotic, not psychic. :P

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The next retail sales report is expected to show sales are down. What happened to all the hype we were hearing only a week or two ago about the economy being strong and getting stronger or the Fed is increasing rates because the economy is so strong?

 

A Recovery Trying to Keep Its Legs Suddenly Feels Woozy

By EDUARDO PORTER

Published: July 12, 2004

 

Retail sales slowed in June. Auto purchases declined. Several technology companies warned about weak software and hardware spending at the end of the second quarter.

 

Less than three years since the United States emerged from a recession, a patchwork of unexpectedly soft economic reports is raising doubts about the vigor of the recovery.

 

"At every client meeting I have,'' said Ethan S. Harris, chief United States economist at Lehman Brothers, "I'm asked whether a slowdown has hit the U.S. economy."

 

 

http://www.nytimes.com/2004/07/12/business/12slow.html

 

VP Cheney says deficits don't matter. We are about to find out if he is right.

 

Today there is also a smaller, but more hair-raising, deficit threat that is receiving increased attention from some economists: that the investors who finance our deficits by buying Treasury bonds and bills, especially the foreigners who buy a larger share of them than ever, will question our ability to repay them, and balk at lending more -- triggering a big drop in the dollar and much higher interest rates.

 

This is not a new concern. In his 1986 book, "The Triumph of Politics," former Reagan budget director David Stockman warned that deficits eventually would scare off investors and send the dollar plunging and inflation and interest rates soaring, bringing on a recession. Of course, he was wrong: Foreigners happily continued financing U.S. deficits, and while the dollar did go on a roller coaster, inflation stayed low. When recession finally arrived in 1990, it was mild.

http://online.wsj.com/article/0,,SB1089583...e_whats_news_us

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How Much Recovery

 

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Anybody here that would consider shorting Seagate ?

 

 

That High-Tech Balloon Is Going Ssssssssss

 

GRETCHEN MORGENSON

NyTimes

July 11, 2004

 

""This industry is hopelessly optimistic," Mr. Hickey said. "They always overproduce."

 

None of this would matter if technology shares were cheap. But they are not. The price-to-earnings ratio on both Dell and Cisco is 32. Texas Instruments' is 30, and Intel's is 26."

 

 

http://www.nytimes.com/2004/07/11/business...ey/11watch.html

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On "Morning Call," around sixish.

 

Serious-looking guy (I think he was from WSJ) telling the blonde info babe that yes, actually, federal deficits do matter:

 

** He said that, unlike the Reagan years, now 40% of federal debt held by foreigners.

 

** Retirement of baby boom generation could make things worse as federal expenditures for entitlements climb.

 

** Our foreign creditors might lose their appetite for purchase of more Treasuries if they come to doubt fedgov's ability/willingness to pay.

 

Blonde info babe registered mild surprise, even a faint little bit of amusement at the thought that foreign investors would ever question US sovereign debt.

 

And rightfully so. I mean, after all, what does "flight to safety" mean, besides buying US Treasuries?

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wish i understood cycles

 

simplistic look at charts (based on 26yrs exp) says

 

imminent collapse in yields

subsequent dive in stocks

accompanied by explosive updside on gold,oil

 

soon

 

bwtfdik

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**  Retirement of baby boom generation could make things worse as federal expenditures for entitlements climb.

This situation would cause a crisis by itself. Entering this period with huge deficits makes it a nightmare scenario.

 

This book is a very scary read :

 

In 2030, as 77 million baby boomers hobble into old age, walkers will outnumber strollers; there will be twice as many retirees as there are today but only 18 percent more workers. How will America handle this demographic overload? How will Social Security and Medicare function with fewer working taxpayers to support these programs? According to Laurence Kotlikoff and Scott Burns, if our government continues on the course it has set, we'll see skyrocketing tax rates, drastically lower retirement and health benefits, high inflation, a rapidly depreciating dollar, unemployment, and political instability. The government has lost its compass, say Kotlikoff and Burns, and the current administration is heading straight into the coming generational storm.

 

http://www.invest-store.com/cgi-bin/capita...gi?item=2097539

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AM radio news: FBI is warning that they've been picking up a lot of "chatter" to the effect that terrorists are going to "hit Wall Street."

 

Omitted details: who said it to whom, physical location of persons doing the "chattering," who heard or overheard it, and how.

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AM radio news: FBI is warning that they've been picking up a lot of "chatter" to the effect that terrorists are going to "hit Wall Street."

 

Omitted details: who said it to whom, physical location of persons doing the "chattering," who heard or overheard it, and how.

NWD,

Maybe the FBI has been monitoring this site? :unsure:

After all, short sellers might be deemed "terrorists" in this day and age! :D

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Re Orvack's post above about the coming generational storm ...

 

Yesterday Icky Twerp posted this quote from an Az. Republic article:

 

From widespread forest fires to reservoirs at historic lows, the warning signs are gathering. Climate experts are saying the "drought" may be the more normal cycle for this desert. In other words, we laid down an artificial metropolis of 3.5 million people on false expectations.

 

I guess we can survive without Phoenix. But what if we "laid down an artificial economy of 300 million people on false expectations"?

 

Soylent green ... :(

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