This morning the Census Bureau reported housing starts for December 2008. The number, 550,000 units, was considerably worse than the already expected number. Which means we have passed a milestone. We are now officially in the worst housing slump since the Great Depression.
Almost exactly a year ago, I wrote a diary entitle, The worst housing slump since the Great Depression? which noted that, at that point, the housing decline was on par with the worst since World War 2, and was likely to worsen.
Here's the data I cited:
In December 2007, an annual rate of 604,000 new single family houses were started. This is a dramatic decline of (-56.5%) from the all time high of 1,389,000 annual rate of starts only 17 months ago in July 2005.
One cannot argue the Chinese really don't mess around on corporate crime. Death over Chinese Milk:
Death penalty over Chinese milk
Breaking News
One man has been given the death penalty and another a life sentence for their involvement in China's contaminated milk scandal.
Zhang Yujun and Zhang Yanzhang were accused of involvement in producing a melamine-laced powder that enabled milk to appear higher in protein.
The so-called "protein powder" was then sold to dairies, and led to the deaths of six children and made 300,000 ill.
Several other businessmen and executives are due to be sentenced.
The death sentence of Zhang Yujun was the first to be handed down by Shijiazhuang Intermediate People's Court in northern China, where the Sanlu dairy, which was at the centre of the scandal, is based.
You know, I am glad I'm on pain pills and other meds today, because frankly if I weren't I would need it as my heart would be even further break when I see things like this. Frankly, if future generations cursed our names, surprise would be the least thing on my mind. Recently read a post from Seeking Alpha . The article, or where you should go is from the blog mentioned in that blog, East Coast Economics. But before you go there, read the comments on Seeking Alpha, more folks like us than I figured.
On Monday the UK government declared total war on the economic crisis, and not a moment too soon. A long phony war ended abruptly with the financial system’s near-meltdown in October. Now, in the next phase of the crisis, the government is thankfully using a full arsenal of ammunition.
Ten days remain before California will begin defaulting on its obligations.
...
The state is spending so much money that Governor Schwarzenegger could fire every single California civil servant and still not come close to balancing the budget! Even if he also fired the other 149,000 legislative aides and people who work for the state’s courts or university systems (people not directly under the state’s control), he still couldn’t eliminate the deficit.
Lawmakers are spending so much money that California could become a state without employees and still not balance its books.
Alternatively, Schwarzenegger could close every single state prison, fire the guards, release all the prisoners—plus cut off all funding for health care across the entire state—and still be billions in the hole.
Listed were issues from sounding like Fredo, not giving specifics on what to do on the financial crisis, the fact that many of these failures happened while Geithner was New York Fed President, the fact he was in on the original bail out, did not pay his taxes, even used Turbo Tax on his taxes (at least he now knows that program sucks!)...
but more that Sheila Bair understands we need "bottom up" stimulus and must stem foreclosures to having a much stronger regulatory philosophy.
Then, Cramer claims Geithner, while wrong and weak must be approved.
What is Nationalization? It means to put under government ownership and/or control a private sector institution.
Like a grassroots tsunami wave, the blogs are now a buzz with the concept of nationalization of the banks. But we pointed out, months ago, by nationalization, Sweden had the best result and least pain during their financial crisis.
Tony has made a list of some of the nationalize now blog posts sprouting up like mushroom clouds in a nuclear implosion.
First it was Bear Stearns. Then it was the Countrywide and the mortgage lenders. Then it was Lehman and AIG.
Now we have another banking crisis brewing, but this one is different because it's not from America. This one is from the other side of the Pond.
Jim Rogers, chairman of Singapore-based Rogers Holdings, said the “U.K. is finished” and investors should sell the currency.
...
“I would urge you to sell any sterling you might have,” said Rogers. “It’s finished. I hate to say it, but I would not put any money in the U.K.”
In Do Nominal GDP Numbers Mean Anything (Very Much)?, Chris White has some stern words for how useless a measure Gross Domestic Product has become, and excoriates some "progressive" economists who recently used GDP "in a nominally uncritical way." And he takes aim at some of the results of economists' unwillingness to accept the need for normative judgements:
Update: The quoted paper is the Latin American Herald Tribune. But there is a comment left by a supposed GM representative here which I highlight:
GM is NOT using U.S. Government Loans to Invest in Brazil
Re: Robert Oak's post on 1/19/09, "GM using Bail Out Money to Invest in Brazil"...The claims that General Motors is planning to invest $1 billion of U.S. federal aid money in its Brazilian operations is unequivocally wrong and without any basis in fact. No monies from a U.S. government loan would be allocated to investments in Brazil. In the case of Brazil, GM has $1 billion in investments that have been announced over the last two years. These investments are fully financed by GM's Brazilian operations through local sources. GM's operations in Brazil are fully self-funded.
Laura Toole
GM Latin America, Africa, Middle East Communications
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