Pepe Escobar: Daesh, Creature Of The West
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World View & Market Commentary.
Forest first; Trees second.
Focused on Real & Knowable facts that filter through the "experts" fluff and media hyperbole. Where we've been, what the future may hold and developing a better way forward.
It turns out that the economy at the end of 2010 was about as strong as most had expected all along. Fourth quarter GDP growth was bumped back up to 3.1 percent annualized growth from the second estimate of 2.8 percent. The latest estimate came in slightly higher than the consensus forecast for 3.0 percent. As with the prior estimate, the fourth quarter was still stronger than the third quarter pace of 2.6 percent.
The upward revision to fourth quarter growth primarily reflected stronger inventory investment, nonresidential structures, equipment & software, and residential investment. Downward revisions were seen in net exports and government purchases.
Demand numbers were little changed. Final sales of domestic product were unrevised net from the second estimate of 6.7 percent. Final sales to domestic purchasers (takes out net exports) were revised up marginally to 3.2 percent from the second estimate of 3.1 percent for the fourth quarter.
Year-on-year, real GDP in the fourth quarter is up 2.8 percent, compared to 3.2 percent in the third quarter.
On the inflation front, the GDP price index was unrevised compared to the second estimate of 0.4 percent. Analysts had expected 0.4 percent.
The latest estimates for GDP and components indicate that the economy had moderately strong forward momentum at the end of 2010. More recent monthly numbers show overall momentum continuing but very mixed by sector with manufacturing, export, and consumer sectors leading growth and with housing, commercial real estate, and state & local government sectors weighing on growth.
On the news, markets were little changed.
NEW YORK (CNNMoney) -- The average American family's household net worth declined 23% between 2007 and 2009, the Federal Reserve said Thursday.
It is time to get real. The fact is, we are now in a housing market depression. Almost every economic recovery in this nation's history has been started by the housing industry. That is not happening at this time. Just the opposite, Housing is disintegrating into the Great Housing Depression. Check out these numbers: First of all, housing prices have fallen 26 percent since their peak a few years ago, the largest price decline ever in our nation, worse than what occurred during the Great Depression of the 1930's. We just learned this week that New Home Sales fell 17 percent month over month in February 2011 versus January 2011. The gross number of New Home Sales in February 2011 annualizes to 250,000, which is the worst on record, ever. This number is less than half the number of sales in 1963, which saw 560,000 New Home sales - but with 120 million fewer people then than now live in the U.S. Think about that. February's number is abysmal. Families dependent upon the Housing Industry are headed for economic ruination. The construction industry is going to see a ton of small builders go belly up. When we consider the February 250,000 sales figure, we need to understand that 700,000 annual sales is normal for a healthy economy. Up to this point, the worst sales year ever still had 323,000 New Home sales. This February figure is dreadful. Banks have tightened lending standards, making it so difficult to qualify for a mortgage that a third of all sales are now 100 percent cash deals. In other words, a third of all sales are occurring without a bank. Collateral values are sinking. Short sales are rising. This is a spiraling black hole of coming economic devastation, a contagion that will spread throughout the entire economy (except of course the protected Wall Street folks, who get to enjoy the Fed's fraud on America, taking all the liquidity the Fed can print and trading markets with the printed cash for self-gain, a corruption right up there with Nero fiddling while Rome burned). Existing Home Sales were no better, falling 10 percent in February, with prices plunging on existing homes that get sold. All the above will contribute toward significant increases in the value of precious metals as folks flock to a financial instrument that has no counterparty, is real and physical, and not subject to corporate mismanagement.
Fewer and fewer Americans are claiming unemployment benefits in a developing trend that will boost expectations for accelerating payroll growth. Initial jobless claims fell 5,000 in the March 19 week to 382,000 (prior week revised to 387,000). The four-week average edged lower to 385,250 to show a more than 15,000 month-ago improvement. These are the best readings of the recovery.
Continuing claims are also posting the best readings of the recovery, down 2,000 to 3.721 million in data for the March 12 week. The four-week average of 3.755 million shows a nearly 150,000 month-ago improvement. A total of 8.766 million claimed unemployment benefits in data for the March 5 week, an improvement of more than 187,000 from the prior week.
Today's durables report is a quandary relative to all of the good news in earlier released manufacturing surveys. New durables orders were unexpectedly down and with just over half of the major industries declining for the month. Overall durables orders in February dipped 0.9 percent, following a revised 3.6 percent rebound in January (previously estimated at up 3.2 percent). Excluding transportation, new orders for durable goods decreased 0.6 percent after a 3.0 percent drop in January.
Transportation led February's drop, slipping 1.9 percent after a huge 29.6 percent jump in January. The decrease was primarily due to an 18.4 percent fall in defense aircraft orders. On the positive side within transportation, motor vehicles rose 1.9 percent while nondefense aircraft & parts increased 26.7 percent.
Outside of transportation, the numbers were mixed. Declines were seen in primary metals, down 2.1 percent; machinery, down 4.2 percent; and in "other," down 0.6 percent. Gains were seen in fabricated metals, up 2.1 percent; computers & electronic parts, up 0.6 percent; and in electrical equipment, up 2.6 percent.
Business investment in equipment has softened after strength late last year. Nondefense capital goods orders excluding aircraft in February decreased 1.3 percent, following a 6.0 percent drop the month before. Shipments for this series edged back up 0.8 percent, following a 2.3 percent fall in January.
The durables orders series is one of the most volatile that there is on a monthly basis and that may be the focus of analysts as the worst-than-expected number was outweighed by a marginally lower-than-forecast number for initial jobless claims. On the news, equity futures edged up on the jobless claims.
Chernobyl Cleanup Survivor's Message for Japan: 'Run Away as Quickly as Possible'
What message do you have for Japan?
Run away as quickly as possible. Don't wait. Save yourself and don't rely on the government because the government lies. They don't want you to know the truth because the nuclear industry is so powerful.
Plus 2.7 percent is wild for March 18 mortgage applications data, a gain posted for the purchase index, the refinance index, and of course the composite index. The purchase index is still below levels at year end but is showing month-to-month strength that hints at improved home sales for March. The refinance index is tangibly higher reflecting favorable mortgage rates, averaging 4.80 percent in the week for 30-year fixed loans.
Low radiation levels from Japan detected in Washington; no health risk
OLYMPIA - A Department of Health air monitor in Seattle has detected trace levels of radiation in connection with Japan’s nuclear emergency. The minuscule amounts of radioactive iodine are millions of times lower than levels that would be a health concern. Despite these very small amounts, the state’s overall background radiation levels haven’t risen.
The positive results are consistent with findings reported by federal and Canadian partners, and by independent researchers. As expected, because of the distance from Japan and air mixing, radiation reaching our state is so diluted there is no health risk here, making protective action unnecessary.
People in Washington shouldn’t take potassium iodide, also known as KI, because of what’s happened in Japan. Only people who work in or around nuclear power plants during an emergency, or who live near such a plant and can’t get away, should take KI.
The housing sector may be suffering another setback, at least based on the February report for existing home sales which fell nearly 10 percent to a lower-than-expected annual rate of 4.88 million. Year-on-year, sales are down 2.8 percent. Declines are evenly split between single-family homes and condos and are also evenly split across regions.
The bad news continues: supply is up and prices are down. Supply rose 3.5 percent to 3.488 million homes in what is 8.6 months of supply at the current sales rate, up from 7.5 months in January and even above year-ago February supply of 8.4 months. The median price fell 1.1 percent February to $156,100 with the average price down 1.4 percent to $203,000. Year-on-year, the decline for the median price is deepening, at minus 5.2 percent, but is steady for the average price at minus 2.7 percent.
Distressed sales made up a very heavy 39 percent of all transactions with cash transactions at 33 percent, a very heavy proportion pointing to bottom fishing by investors but also reflecting still tough credit conditions for ordinary home buyers. The economy, unlike other cycles, has been able to recover nicely even without the housing sector. New home sales data will be posted on Wednesday.
The Chicago Fed's national activity index slipped to minus 0.04 in February from minus 0.01 in January (revised from minus 0.16). Continued weakness in the consumption & housing component during February offset positive contributions from the index's other three components. The three-month moving average rose to plus 0.11 from January's plus 0.05 (revised from minus 0.10).