Tuesday, December 20, 2011

Morning Update/ Market Thread 12/20 - Narcissistic Asshats Edition...

Good Morning,

Equity futures are zooming this morning and overnight as Europe laughably advances with the media touting a “strong” Spanish bond sale. Complete joke on several fronts, the least of which is that neither the equity markets, the bond markets, nor the media are even close to real. In the current central banker paradigm, they own all of the above… all it takes for a “good” or a “bad” bond issue is for them to step in or out with their money made from nothing. That’s it, that’s all it takes. The people have no vote on their actions, no say whatsoever, and that’s exactly why the notion of an “elected democracy” is simply just a fantasy at this point.

Of course our dollar is falling to allow the ramp in equities, bonds are falling from extreme heights, oil is zooming, gold & silver are bouncing, and most importantly to the majority of people on the planet, food commodities are also zooming on the dollar debauchery.

Amazingly, the Greek government announced that due to widening deficits it is stopping all outgoing payments – pensions, all government payments, everything! Yet of course they are not stopping revenue collection! Talk about broken, queue the next level of rioting.

Meanwhile, completely unconcerned about the “majority,” Jamie Dimon, Economic Edge Asshat of the Year Award Winner and CEO of JPMorgan, once again puts his foot into his narcissistic mouth:
Bankers Seek to Debunk ‘Imbecile’ Attack on Top 1%

Jamie Dimon, the highest-paid chief executive officer among the heads of the six biggest U.S. banks, turned a question at an investors’ conference in New York this month into an occasion to defend wealth.
“Acting like everyone who’s been successful is bad and because you’re rich you’re bad, I don’t understand it,” the JPMorgan Chase & Co. (JPM) CEO told an audience member who asked about hostility toward bankers. “Sometimes there’s a bad apple, yet we denigrate the whole.”

Dimon, 55, whose 2010 compensation was $23 million, joined billionaires including hedge-fund manager John Paulson and Home Depot Inc. (HD) co-founder Bernard Marcus in using speeches, open letters and television appearances to defend themselves and the richest 1 percent of the population targeted by Occupy Wall Street demonstrators.

If successful businesspeople don’t go public to share their stories and talk about their troubles, “they deserve what they’re going to get,” said Marcus, 82, a founding member of Job Creators Alliance, a Dallas-based nonprofit that develops talking points and op-ed pieces aimed at “shaping the national agenda,” according to the group’s website. He said he isn’t worried that speaking out might make him a target of protesters.

“Who gives a crap about some imbecile?” Marcus said. “Are you kidding me?”

Mr. Marcus makes a very typical narcissistic statement, echoing much of what Dimon has said in the past. This article, from a source that is complicit and owned by another famous narcissist (Bloomberg), also only mentions Dimon’s base salary, always downplaying what fellow “club” members really make. The fact is that Dimon is heading the world’s largest holder of derivatives, a company that wrongly stole the ability to produce money from the people. He and his company then use that ability to buy their own special rule of law that allows them to rob the American people. The issue is not genuine success, I don’t think anybody denies the genuine successful businessman – but Jamie Dimon is NOT one, he is a cheater and a fraud who has an unfair and illegal advantage (read the Constitution, Article 1, Section 8) over the rest of the people on the planet. And since he has no sympathy for those who don’t have or want his unfair advantage, that is what makes him the king of the narcissists.

This morning Housing Starts data supposedly came in better than expected, largely due to “multi-family” housing – that is apartments for the 99% who are being evicted from their single family homes en masse (thank you, Mr. Dimon, for helping to create the largest housing bubble in history [and then profiting from its collapse] – Asshat!).

Remember, building inventory into an oversupplied and price descending market is not a good thing, in fact bringing on inventory too soon is a bad thing as it will continue to suppress prices. Building apartments is a speculative phenomena by individuals and funds that have too much money and not enough places to put it to work that is REAL. Here’s Econoplicit:
New housing construction is showing signs of life in November-although the pulse is still weak. Housing starts in November rebounded 9.3 percent after slipping 2.9 percent in October. The November annualized pace of 0.0.685 million came in higher than market expectations for 0.636 million units and is up 24.3 percent on a year-ago basis. The gain in November was led by a 25.3 percent jump in the multifamily component, following a 15.2 percent decrease in October. The single-family component improved 2.3 percent after a 3.6 percent rise the month before.

By region, the boost in starts was led by a 53.8 percent jump in the Northeast. Other regions showing increases were the West, up 22.6 percent, and the South, up 4.1 percent. The Midwest declined 18.2 percent.

Homebuilders are a growing in optimism although still to a modest degree from low levels as housing permits advanced 5.7 percent after jumping 9.3 percent in October. The November rate of 0.681 million units annualized topped the consensus forecast for 0.645 million. Permits in November are up 20.7 percent on a year-ago basis.

The November gain in permits was led by a 13.9 percent jump in multifamily permits after a 22.7 percent surge in October. Single-family permits rose 1.6 percent, following a 3.6 percent increase the prior month.

Today's housing starts report is consistent with yesterday's report of a rise in the National Association of Home Builders' housing market index. There are signs that the level of activity in single-family home sales is picking up, but the real action clearly has shifted to the multifamily sector as high unemployment and still tight credit are constraining home sales.

Just to put this depression era number into perspective, below is the long term chart of Housing Starts:

Housing Starts:

Yesterday the “Housing Market Index” came out… rising from 20 to 21, what fun! However, since the prior month was revised down to 19, LOL, Econoday touted a 2 point rise! No, I won’t even reproduce that tripe. I’m bringing it up because I want to point out that this Index, and the Housing Starts data are brought to you buy… wait for it… wait for it… the National Association of Home Builders (NAHB – no self-interest there) along with… wait for it… Wells Fargo! I’m laughing so hard I’m spewing coffee that anyone would believe any of this “data.”

So, what else should you know about the “Housing Market Index?” Well, not only does it come from a completely biased group, but it is simply “based on a survey in which respondents from this organization are asked to rate the general economy and housing market conditions.”

Uh huh. In other words, not in the least bit scientific. So, what’s it for, you may ask? Its purpose is to implant perceptions in your mind, perceptions that the special interests control. That’s it. Usually the special interests don’t like it when their own data looks bad, so what they do is either just stop comparing it to historical data, or they change the methodology to make past comparisons difficult, like what the Mortgage Bankers did with their “data.” In this case, the media like Econoday, stops disseminating charts when the data isn’t favorable. But if you dig a little deeper on the NAHB site, you can still find the data in chart form, and here it is:

Housing Market Index vs. New Single Family Starts:

Clearly depression era numbers, only about a third of the normal historic level. Is that what we get when reading the Econoday reports? Why is that?

Merry freakin' Christmas Jamie Dimon. Self-Delusion can be a dangerous thing.

Here's a sample of reality. In Washington State over the past decade, the number of firms offering their employees health care benefits declined from 76% to just 54% today!
Decade sees steep drop in companies with employee benefits

The percentage of Washington companies offering employee benefits has declined markedly in the last decade, a new report from the Economic Opportunity Institute shows.

In 2002, 76 percent of firms in Washington provided health insurance to full-time employees, while in 2010, that figure was just 54 percent, according to the institute’s Washington’s Working Women 2012.

The percentage of firms offering retirement benefits to full-time employees fell from 60 percent in 2002 to just 36 percent in 2010. And the percentage of firms offering paid sick leave to full-time employees shrank from 56 percent in 2002 to 44 percent in 2010.

For part-time employees — the majority of whom are women, according to the report — only 15 percent of businesses offered retirement benefits, 22 percent provided vacation, and 11 percent offered health benefits.

The report also found that women made only 63 percent of what men did in 2010, a decrease from 1991, when the figure was 65 percent. Men outearned women at every level, making $7,000 more a year at the high-school graduate level and $27,500 per year among those with a professional or graduate degree.

“State budget cuts, declining workplace benefits, and a widening wage gap are putting Washington’s women at risk for more economic instability and poverty in 2012,” the institute commented in a press release.

Did someone say "poverty?" Well, here's the latest chart from the Census Bureau showing the number of people they consider in poverty. Note the trend, but also keep in mind that they adjust the figures for the income level considered "poverty" and that those adjustments don't account for the loss of benefits (see above) that aren't counted as income for these poverty measurements:

Ho, ho, ho, Jamie "Scrooge" Dimon, Merry Freakin' Christmas!

Since this is the week for housing data, I do want to revisit the Option-Arm reset chart. We are now well on the back side of peak, so again I do expect that the pressure on upper end homes will slowly begin to abate in the coming months:

Option-Arm Resets:

No, this is not a bottom call, just that the pressure is coming off a little, the same thing that happened post Subprime. There is another danger wave to housing, that being the artificial low nature of manipulated interest rates.

The markets are now zooming absolutely straight up. Why? I’m sure the media will find the reason, but it will certainly have nothing to do with this:

M1 Money Supply:

I, Nathan Martin, no longer consent to the lies.