Sales of previously owned homes in the U.S. unexpectedly rose from a record low, propelled by the biggest slump in prices since the Great Depression as foreclosures surged.
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The index of leading economic indicators unexpectedly increased in December as the money supply expanded, a report from the Conference Board, a New York-based research group, showed today. The 0.3 percent increase was the first gain in six months and masked signs of a worsening recession.
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The number of previously owned unsold homes on the market at the end of December represented 9.3 months’ worth at the current sales pace, down from 11.2 months’ at the end of the prior month.
The supporting data normally cited in the welter of economic commentary suffers from an important limitation. Almost all of those indicators date from the 1950s and 1960s onward. That is to say, they cover a period where there was not even one single deflationary event. All of their reliability comes from a period of waxing and waning inflation -- but always inflation. As we are experiencing the most significant deflationary recession since the Great Contraction of 1929-32 and the Post World War 1 deflation of 1920-21, the applicability of these indicators is very suspect.
This point was driven home to me when I saw a graph of one such very reliable post-war indicator -- the yield curve -- dating from 1929. The graph re-posted below, shows a relentlessly positive yield curve (short term rates are in green, long term rates in red).
If one were ignorant of history, one would have expected that with the exception of a couple of brief bumps, the economy would have been expanding nicely throughout the entire period from 1929-1950! Even during most of the "great contraction" of 1929-32, the yield curve was positive.
Britain is planning to ban advertising jobs overseas due to economic meltdown, a process which could hit Indian professionals aspiring for employment opportunities in the UK.
The government is mulling an idea to ensure that existing jobs go to British workers. The employers are being forced to notify vacancies in employment agencies within Britain to prioritise local candidates.
Indians are among the largest foreign professionals working in Britain. Every day, thousands of jobs are being cut across the sectors in Britain. Official figures suggest that unemployment figure is reaching the 2 million mark, for the first time since the mid-1990s.
As previously discussed, the devil always resides in the details of a large appropriations bill from Congress and the Stimulus is no exception.
Now Congress is trying to ascertain which jobs would be ready to go, shovel ready or quickly created from the upcoming Stimulus package.
Aha! Earmarks are banned you say? No problem say the lobbyists!
It won't be in legislative language that overtly sets aside money for them. That's the infamous practice known as earmarking, which Obama and Democratic congressional leaders have agreed to nix for the massive stimulus package, expected to come up for a House vote this week.
Well, as we all know insolvent banks need to be fed even more money to operate and instead of plain nationalizing them we have Speaker of the House Nancy Pelosi considering even more financial bail out TARP money!
The actual numbers from the Commerce Department are not out until January 30th. Yet both Bloomberg and Marketwatch are reporting a 5.5% annual rate drop in GDP for Q4.
Gross domestic product contracted at a 5.5 percent annual rate from October through December, the biggest drop since 1982, according to the median estimate in a Bloomberg News survey ahead of Commerce Department figures due Jan. 30.
Real economic activity fell off a cliff during the fourth quarter, producing a sharp drop in employment, output and spending," wrote economists at Wachovia.
And the worst part is that it's not over. Economists expect another huge decline in the first quarter, with a smaller contraction in the second quarter
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