More Evidence The Economy Is Deteriorating

Discussion in 'Economy' started by McRocket, Aug 27, 2018.

  1. McRocket
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    McRocket VIP Member

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    '“Financial-market and economic prospects remain far shy of the hype and headlines, amidst tanking consumer optimism and negative revisions to recent reporting.” – John Williams, Shadowstats.com

    The economy may seem like it’s doing well if you are part of the upper 10% demographic. Though, in reality, for most of the upper 10%, doing “well” has been a function of having easy access to credit. NASA Federal Credit Union is offering 0% down, 0% mortgage insurance for mortgages up to $2.5 million.

    Someone I know suggested the tax cut stimulus had run its course. But the narrative that the tax cuts would stimulate economic activity was pure propaganda. The tax cuts stimulated $1 trillion in expected share buybacks and put more money in the pockets of corporate insiders and billionaires. The average middle class household spent its tax cut money on more expensive gasoline and food. Since the tax cut took effect, auto sales and home sales have declined. Retail sales have been mixed. However, it’s difficult to distinguish between statistical manipulation and inflation. I would argue that, net of real inflation and Census Bureau statistical games, real retail sales have been declining.

    As an example, last week Black Box Intelligence released July restaurant sales. While comparable store sales were up 0.54% over July 2017, comparable restaurant traffic was down 1.8%. On a rolling three months, comp sales are up 0.46% but comparable traffic is down nearly 2%. With traffic declining, especially a faster rate relative to the small increase in sales, it means the sales “growth” is entirely a function of price inflation. If Black Box Intelligence could control it’s data for price increases, it would show that there is no question that real sales are declining. I have been loathe to recommend shorting restaurant stocks because, for some reason, the hedge funds love them.

    On Wednesday last week, the Government reported July retail sales, which were “up” 0.5% vs June. However, June’s 0.5% “gain” was revised sharply lower to 0.2%. Revising the previous month lower to make the headline number for the reported month appear higher is a mathematical gimmick that the Government uses frequently. As an example of the questionable quality of the retail sales report, the Government reports that sales at motor-vehicle and parts dealers rose 0.2% from June to July. But the auto industry itself reported a 4% decline in sales from June to July. I’ll leave it up to you to decide which report is more reliable…

    Housing starts for July, reported last Thursday, showed an 8% decline from June’s number. June’s number was revised lower from the original number reported. No surprise there, at least for me. The report missed the Wall Street brain trust’s expectations by a wide margin for the second month in row. The downward revision to June makes the report even worse. Additionally, housing starts are now down year-over-year for the second month in a row.

    This report followed last Wednesday’s mortgage applications report which showed a decline in purchase applications for the 5th week in a row.The housing starts number continues to throw cold water on the “low inventory” narrative. While there still may some areas of housing market strength in the $500,000 and below price bucket, the mortgage purchase applications data has been mostly negative since April, which reflects deteriorating home sales. This reality is “magnified” by the fact that home sales have declining during what should be the strongest seasonal period of the year for home sales.'


    More Evidence The Economy Is Deteriorating


    What is obviously apparent is what most knowledgeable people on Wall Street said before the tax cuts...that they would not help the middle/lower classes and that just about the only thing the corporations would do with the extra money would be to instigate even more stock buybacks (which is what they have been doing since 2009).

    Once again, I am neither Dem nor Rep.
     
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  2. Dale Smith
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    Dale Smith Gold Member

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    I don't support either bought and paid for political party but Trump has done more to boost the economy by taking away unfair restraints on job growth while killing the TPP. The bottom line is that you don't have the faintest clue.

    BTW, you are a leftard...if it walks like a duck, quacks like a duck...has webbed feet and a yellow bill? Then it's a fucking duck.....
     
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  3. Slade3200
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    Slade3200 Gold Member

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    Quack quack... did somebody say duck?! ;-)
     
  4. fncceo
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    fncceo Gold Member

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    Maybe deteriorating for you ...

    [​IMG]
     
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  5. Dale Smith
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    Dale Smith Gold Member

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    LOL! I am sure there was a point that you were trying to make.....guess it flew past me?? :eek:)
     
  6. DOTR
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    DOTR Gold Member

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    Yet you spout Dem propaganda. And you vote Dem. So you may as well be.
     
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  7. DOTR
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    DOTR Gold Member

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    The OP, like all leftists, is praying for a bad economy.
    But until then I’ll enjoy this great one.
    Winning.
     
  8. waltky
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    waltky Wise ol' monkey Supporting Member

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    Does this mean Granny gonna have to...

    ... get out an' sell apples onna street corner...

    ... to get by?
     
  9. Erinwltr
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    Erinwltr VIP Member

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  10. McRocket
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    McRocket VIP Member

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    Of course, as per usual, they have zero links to any data that disputes the facts posted.

    Just empty-headed words taken from the mouth of POTUS Man-Child.

    I bet you most of them neither read the OP and of those who did...I am quite sure most of them did not even fully understand it.

    They are so funny. Flopping around, saying 'everything is wonderful'...when most of them obviously have no clue what they are even saying.
     
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    Last edited: Aug 27, 2018

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