Wednesday, October 12, 2011

Morning Update/ Market Thread 10/12 - Getting Involved in the Bill Still for President Campaign Edition!

Good Morning,

Equity futures are higher again this morning, with the dollar, of course, paying the price, bonds lower, oil higher, gold & silver higher, and food commodities adding onto yesterday’s large move higher.

The hypocritical Mortgage Banker’s Association reports that Purchase Applications rose 1.1% over the past week, and that Refinancing Activity also rose by 1.3%. Of course their numbers are meaningless and I would contend fraudulent, however, we know that they are still close to all-time lows. Here’s Econoday reporting on these numbers as if they are real and not conflicted:
The purchase index is extending its recent firm run into October, up 1.1 percent in the October 7 week. The gain in this index is a positive indication for underlying home sales. The refinance index is up 1.3 percent. Both indexes are getting a boost from low interest rates, at 4.25 percent for conforming 30-year loans under $417,500 and at 4.59 percent for jumbo loans over $417,500. Purchase demand is also getting a boost from continued discounting in home prices, indicated in this report by a fall in the average loan size to $210,863 in September vs $212,736 in August.

You mean that you can track the average loan size the week after a month? Gee, how come that metric hasn’t been getting attention? I would think that this is a quick read on the reality of home price pressures.

Speaking of unusual reads on the economy, Econoday has begun publishing the “Ceridian UCLA Pulse of Commerce Index (PCI)." What is the Ceridian UCLA PCI?
The Ceridian-UCLA Pulse of Commerce Index (PCI) is based on real-time diesel fuel consumption data for over the road trucking. Ceridian is a global business services company providing electronic payment services and human resources solutions. By tracking the volume and location of fuel being purchased, the index closely monitors the over the road movement of raw materials, goods-in-process and finished goods to U.S. factories, retailers and consumers. The PCI serves as an indicator of the possible future direction of the U.S. economy. Working with economists at UCLA Anderson School of Management and Charles River Associates, Ceridian provides the index monthly.

Hmmm, that might be a good metric to watch, so what is the Ceridian UCLA Index doing now?
The Ceridian-UCLA Pulse of Commerce Index fell 1.0 percent in September on a seasonally and workday adjusted basis, following a 1.4 percent decline in August and a 0.2 percent decline in July. In the last three months, the PCI has declined at an annualized rate of 10 percent per year. This rate of decline has been exceeded only in the deep recession of 2008/09, and equaled only once outside of a recession in March 2000. In other words, since June, trucking activity has been receding at a pace that would be expected to show up in other economic measures soon. According to report's statistical analysis, two or three more months like this would confirm an official recession.

And there you have it, measured in something REAL, in this case diesel fuel consumption, the economy has been contracting at the rate of 10% per year! Of course if you measure your metric in dollars, then you may be able to create the appearance of “growth” by monkeying with the supply of money and credit. Note this metric is measuring VOLUME of fuel purchased, not the dollar value of the fuel that is purchased. Frankly I’m surprised Econoblueskies let this out, this is a metric I will follow and report on later.

I have been talking with Bill Still regarding his Libertarian run for President and have agreed to get involved in the campaign in a capacity yet to be decided – one that must work with my business venture. I will be busy over the next few days and weeks, therefore, helping Bill build a platform and team to take his message to the people and to the Libertarian party in hopes of getting him on their Presidential ballot, something Bill and I believe is achievable. But we’ll need YOUR HELP to do it!

We will need people to show up at the state conventions to help Bill gather Libertarian “tokens.” There are 700 of these tokens nationwide, it takes 30 to make it onto the ballot and it is considered a very strong showing if you possess 100 or more which is our goal.

Daryl Klein has agreed to act as Treasurer for the campaign and together we will be activating the SWARM in an effort to get the word out and to garner support for Bill’s run. We will also be building Bill a new website and we’ll be calling for volunteers and for donations to help run the campaign – stay tuned.