The strongest economy in the world

**barbaro** · 03-01-2014, 01:03 AM

Things be goin' bad....

**barbaro** · 03-01-2014, 11:54 AM

Here are some charts. I like charts if done well and accurate because if sums up info so quickly. Do they illustrate the causes? Not really. But we can draw our own conclusions.

Edit in: sorry, click the link at bottom to actually see the charts.

America in 2013, as Told in Charts
By STEVEN RATTNER
Published: December 30, 2013

Looking back on 2013, many of the economic and political themes seemed familiar: a weak economy. Growing income inequality. Gridlock in Washington. Partisan wrangling over fiscal policy. But others, like the disastrous rollout of the Affordable Care Act HealthCare.gov website and the government shutdown, were new or at least revivals. Below are 10 charts to illustrate a depressing first year of President Obama’s second term:
Graphic
Not only did trends of recent years continue in 2013 – particularly the diverging fortunes of the rich and everyone else — but in some ways they accelerated. The stock market, as measured by the Standard & Poor’s index, was up a stunning 32 percent (through Dec. 27). Corporate profits rose to a record $2.1 trillion. Meanwhile, incomes remained nearly flat and jobs tallies grew slowly. Through Oct. 30, earnings were up just 1.4 percent, an even smaller increase than in 2012. The only relative bright spot for the average American was housing; thanks in part to the aggressive efforts by the Federal Reserve to hold down interest rates, sale prices of homes were up by 13.3 percent in September, compared with a year earlier.

Graphic
Economic growth — a likely increase in gross domestic product of just 1.8 percent in 2013, after adjusting for inflation — was also unbalanced in other ways, particularly the impact of the government. The nation’s quickly falling deficit (it dropped from $1.09 trillion to $680 billion in a single year) cost dearly in economic activity. Spending by cash-strapped consumers and investment by skittish businesses both grew at slightly below customary rates. A flat-lining Europe dented President Obama’s pledge to double American exports by 2015. On the other hand, home building and related residential activity, depressed since the onset of the financial crisis, provided a second annual lift to the economy.

Graphic
Employment remained an overarching problem. While job growth has picked up steam in the last few months, the fall’s higher pace of job creation – around 200,000 per month – would still not be nearly enough to bring unemployment down to pre-recession levels. According to calculations by the Brookings Institution’s Hamilton Project, even if the 200,000 jobs per month rate were maintained, the unemployment rate would not fall to the November 2007 level of 4.7 percent for another five years.

Graphic
Not only has the job recovery been sluggish, but also a disproportionate number of those that have been created have been in lower wage occupations, such as retail clerks and fast-food workers. And that trend is projected (by the Bureau of Labor Statistics) to continue; using a simple average, the 10 job categories expected to add the most jobs during the current decade boasted a collective median wage of $32,386 in 2010, roughly $15 per hour and far below the United States median of $51,892 at the time. Seven of the 10 categories pay below this average. Note the conspicuous absence of manufacturing; it may be recovering, but it isn’t what is driving new jobs.

Graphic
Wage increases haven’t been paltry because the efficiency of the American worker has flagged; indeed, productivity has continued to chug along. But those productivity gains have simply not been passed on to workers. Between 2000 and 2012, productivity rose by 22 percent while wages increased by 7.7 percent. The divergence was particularly great over the last three years of that period – productivity up 4.6 percent and real wages down 1.1 percent. For this failure of the American worker to be rewarded for his growing output, blame a variety of factors, perhaps most important, globalization, which has allowed companies to move production to whatever part of the planet offers the lowest cost labor. In that respect, American workers remain in a race to the bottom.

Graphic
The troubles with the Affordable Care Act’s HealthCare.gov rollout sure grabbed daily headlines this fall. But throughout the commotion, little mention was made of the most fundamental aspect of the law: the way in which it raises nearly $2 trillion over the next decade — mostly from wealthy individuals and health care providers — and uses the money to fund the largest expansion in insurance coverage since Medicare was created nearly 50 years ago. As shown above, the end result should be better health care options for those closer to the bottom end of the income scale, through the Medicaid expansion and creation of exchanges with subsidies for most participants. The intended result: 25 million fewer uninsured Americans. Yes, this is redistribution on a grand scale, and we should all be very proud of it. But as evidenced by Obamacare’s consistently poor poll numbers, most Americans are not feeling charitable toward the less well off.

Graphic
Trust in many American institutions has been declining, but few institutions have fallen so far out of grace as Congress. Last year, I showed that the previous Congress was the least productive Congress in modern times, including the famous Do-Nothing Congress of 1947-48, passing just 238 laws, 37 percent of the average of the 32 Congresses that preceded it. In 2013, the first year of this Congress, the number of new laws passed fell further, to 55 (as of Nov. 30), seven fewer than during the same period in 2011. As a result, Congress now stands dead last in approval rating among key American institutions – far below other braches of government, below news outlets, below banks and even below big business.

Graphic
Congress well deserves that poll standing, in significant part because of the damage that it has done to the federal budget. The combination of Republican determination to cut spending and Democratic insistence that none of the entitlement programs (such as Medicare and Social Security) be meaningfully affected has resulted in the utterly inane policy of starving key domestic programs, including education, infrastructure and research and development. The recent budget fight and subsequent agreement did nothing to change that trajectory. As shown by the red line above, all that resulted was avoiding the worst two years of forced budget cuts to these programs; for the 10 years beginning in 2008, this important spending will rise slightly in nominal numbers but will fall by 5 percent, after adjusting for inflation.

Graphic
The dysfunction in Washington has taken its toll in other important ways. Not only has business confidence been shaken, but each new political battle has also been terrifying for consumers. Back in the summer of 2011, when the United States had its AAA credit rating removed by S.&P. after it flirted with default, consumer confidence recorded the second biggest two-month drop ever, behind only the aftermath of Hurricane Katrina. A smaller decline occurred at the end of 2012 when Congress nearly went over a fiscal cliff. Beginning this past July, consumer confidence dropped to its lowest level in nearly two years as a result of the government shutdown, the A.C.A. problems and related battles. Now, a two-year budget nearly in hand, Americans’ moods seem to have improved. At a time when we need consumers to spend (prudently), these periods of faltering confidence have real economic consequences.

Graphic
In contrast to the mood in most of the country and the still slow economy, Silicon Valley is partying again, albeit not quite like 1999. The Facebook initial public offering in May 2012 helped usher in a resurgence of excitement among investors for anything that looks like a sexy new high-tech service. This year’s poster child I.P.O. was Twitter, which set a new record of one kind among recent major technology I.P.O.’s: its valuation of more than 28 times its revenues. That didn’t daunt investors; the stock promptly more than doubled and now trades at 65 times revenues. (Of course, there are no profits.)

Entire; http://www.nytimes.com/2013/12/30/op...nted=all&_r=2&

**Boon Mee** · 05-01-2014, 08:46 AM

Originally Posted by barbaro

Here are some charts. I like charts if done well and accurate because if sums up info so quickly. Do they illustrate the causes? Not really. But we can draw our own conclusions.

Too bad the Obama Administration lies about their charts, eh?

Like this one:

Fails to mention how many are minimum wage service jobs, part-time, or temporary. (Or offsetting the 8.1 million by the number of jobs lost in the first 15 months.)

**barbaro** · 05-01-2014, 11:32 AM

^ Yes, these Mcjobs that are created are overwhelmingly low paying, cash pay, service sector jobs.

**Dream Over** · 05-01-2014, 12:06 PM

You can do everything cheaper overseas and by using cheap labor overseas or brought to the US. American workers are going to see their wages for most jobs stagnate for a long time as long as we live in a globalized economy. If you are an average joe and want longterm security get a government job or government supported job in the oil industry or military industrial area. These jobs have proven to last and often they give priority to hiring Americans over other nationalities. The real free market won't give you what these areas do. Unless you work in these areas, you'll really have to work for your money.

**barbaro** · 05-01-2014, 10:05 PM

1/01/2014
Why American Companies Are Holding Onto $5 Trillion In 'Cash'

Quite frequently, articles will be published with titles like, “Why Are U.S. Firms Holding $5 Trillion in Cash?” or, “Why Millionaire Investors Are Holding On To Cash.” These articles generally imply that there is something strange or unusual going on, and/or that the people and organizations should be “doing something” with all of this cash.

As a public service, Unconventional Logic will answer the “Why so much cash?” question that is being asked so frequently and breathlessly by the financial and economic press.

Here is the answer.

People and companies are holding more cash because there is more cash to hold.

When financial reporters talk about “cash,” they aren’t referring to Federal Reserve Notes, but to highly liquid, risk free, dollar-denominated assets. Things of this description are what corporate treasurers mean when they use the term, “cash.”

The federal government’s “Debt Held by the Public” (DHBTP) can be used as a proxy for the total amount of “cash” (at least, U.S. dollar cash) in the world. Over the past six years, U.S. DHBTP increased by $7.2 trillion, or 140%, to $12.3 trillion. Because this “cash” exists, every time you look, someone, somewhere will be holding it.

Mystery solved.

Moving right along, financial reporters seem to believe that the presence of large amounts of cash on corporate balance sheets means that the companies aren’t investing, or that they should be investing more.

While it is true that real, productive investment is far below the levels needed for robust economic growth, you can’t tell this from the size of corporate cash balances. Investment is “flow.” Cash balances are “stock.”

By one accounting, big companies are holding about $5 trillion in “cash.” If they spent all of it tomorrow, the day after tomorrow, these companies’ cash balances would probably total close to the same $5 trillion. This is because, from the point of view of the private economy, cash cannot be created or destroyed; it can only be moved around.

We can confidently expect that the rate of cash accumulation will slow down. This is because cash production is slowing down. During the past year, federal DHBTP increased by less than $0.8 trillion, or 6.7%.

The amount of (dollar) “cash” that the world holds is determined by the actions of the U.S. government. Decisions made by the private sector can’t impact the total. So, it is best not to assign any great meaning to how much cash is being held, or by whom.

Happy New Year to all.

Why American Companies Are Holding Onto $5 Trillion In 'Cash' - Forbes

**OhOh** · 07-01-2014, 08:57 PM

^Why sell your assets (cash) and be held responsible for possibly a dud investment decision when your share price is going up anyway? The managements bonus depends on the share price going up, not spending money is often seen as a good thing.

**thairanat** · 07-01-2014, 09:28 PM

Ok I'm going to get a slap from the little thai wife........
she told me... never talk about politics, or religion.....talk about beaver, and big bahum, boobies......u will have a lot more friends.

American (world) policies are run by big business, wall street, and the vatican...
I'm sure all the experts will have no comment. back to beaver, boobies, and, and I'll have to move again.

**OhOh** · 08-01-2014, 02:30 PM

Of course all the !New! jobs created are high tech and require multiple degrees, MBA or PHd's."

Of all the case studies in our "it is easier to get into Harvard than to get a job at X" series (flight attendants, Goldman summer interns, McDonalds, etc), this one may be our favorite because it captures at its core, just how "strong" the US economic "recovery" truly is for all those who don't have a spare million or two in financial assets to throw at the levitating, centrally-planned markets.

As the WaPo reports, when a Maryland ice cream plant, shut down in 2011 and subsequnetly was brought back to life when a Co-op of dairy farmers purchased it in the summer of 2013 to process milk and icream, sent out "jobs wanted" notices to fill some three dozen open job positions, it got a surprise: 1,600 applicants (and counting) "a deluge" - 44 applicants for every position - or nearly three times more difficult than getting into Harvard to get a simple job... To make ice cream!
But that's not the punchline. The punchline: the name of the ice cream plant? "Good Humor."
Indeed, how can one possibly doubt that the US recovery is in full swing after reading the following:

Continues at Tuesday Trivia: How Many Americans Applied For 36 Ice Cream Maker Jobs? | Zero Hedge

**barbaro** · 22-01-2014, 06:25 AM

We've seen the adult population to work ratio. Bad numbers. And....

Wall Street adviser: Actual unemployment is 37.2%, 'misery index' worst in 40 years
BY PAUL BEDARD | JANUARY 21, 2014

....former President Ford issued "WIN" buttons, short for "Whip Inflation Now." The campaign failed.
40 years ago, former President Ford issued "WIN" buttons, short for "Whip Inflation Now." The...
Don't believe the happy talk coming out of the White House, Federal Reserve and Treasury Department when it comes to the real unemployment rate and the true “Misery Index.” Because, according to an influential Wall Street advisor, the figures are a fraud.

In a memo to clients provided to Secrets, David John Marotta calculates the actual unemployment rate of those not working at a sky-high 37.2 percent, not the 6.7 percent advertised by the Fed, and the Misery Index at over 14, not the 8 claimed by the government.

Marotta, who recently advised those worried about an imploding economy to get a gun, said that the government isn't being honest in how it calculates those out of the workforce or inflation, the two numbers used to get the Misery Index figure.

Sign Up for the Paul Bedard newsletter!
“The unemployment rate only describes people who are currently working or looking for work,” he said. That leaves out a ton more.

“Unemployment in its truest definition, meaning the portion of people who do not have any job, is 37.2 percent. This number obviously includes some people who are not or never plan to seek employment. But it does describe how many people are not able to, do not want to or cannot find a way to work. Policies that remove the barriers to employment, thus decreasing this number, are obviously beneficial,” he and colleague Megan Russell in their new investors note from their offices in Charlottesville, Va.

Entire: Wall Street adviser: Actual unemployment is 37.2%, 'misery index' worst in 40 years | WashingtonExaminer.com

**barbaro** · 23-01-2014, 10:58 AM

Geared towards Americans and Westerners from some places, it's worthy for many:

Ten Pillars of Financial Independence

Dennis Miller
January 21, 2014

Young folks can usually digest a difficult message more easily when it comes from someone who is not: (a) their parent; (b) their teacher; nor (c) anyone else whose lectures they are sick of hearing. In that spirit, we're starting out 2014 with 10 ways people of any age can safeguard their financial independence. Please feel free to pass it along to anyone in your life who could use a nudge in the right direction from someone other than Mom and Dad.

Wealth is not gauged by how much money you make, but rather how much you keep. Accumulating wealth, regardless of your age, gives you options and independence. It's sad when people toil in jobs they hate because they need the money. Anyone in that position finds their employer controls their time and, sad to say, much of their happiness (or lack thereof).
We all want to be free to enjoy our lives in the manner we choose. Those who manage to achieve this state of nirvana have internalized these 10 pillars.

Pillar #1: Do Not Make Debt a Way of Life

Debt is enemy number one of financial independence. Let's take a look at the most common form of debt, a home mortgage.
Joe and Suzy are in their late 20s with a young family. They're tired of paying ever-increasing rent and want to buy a home. They sacrifice and save $50,000 for a down payment on a $250,000 home.
Joe and Suzy chose from two mortgages, both charging 5% interest. One is based on a 20-year amortization, and one has a 30-year amortization. How much will the home really cost them?

If they choose the 20-year mortgage, their payments are $1,319.91 per month. If they choose the 30-year mortgage, their payments are $1,073.64 month—$246.27 lower. By choosing the lower payment, they're adding $69,732.00 to the cost of their house. Why did it cost so much more? Because of the rent they paid on the money they borrowed for another decade. Had they been able to make the higher payments, they would have 10 years with no house payments to accumulate wealth for retirement.
If, instead of paying the mortgage, they saved $1,319.91 a month for the next 10 years after they're done with the home loan and earned 5% interest on their savings, they'd end up with $204,958.63 in savings at the end of the tenth year.
Therefore, their choices are to sacrifice a bit now so that in 30 years they have a home paid for and $204,958.63 in the bank, or a slightly smaller house payment and a home paid for without a good start on their nest egg. Many of the choices you make 10-20 years ahead of retirement can pay off very well when you want to retire.
I'm a firm believer in paying for your home as soon as possible. Unfortunately, beginning with a starter home and moving up to McMansion after McMansion has become commonplace; this habit can make it practically impossible to pay off your home in a timely fashion.

Pillar #2: Saving and Wealth Accumulation Are Different

Some of the happiest folks at our 50th high school class reunion still lived in modest homes in nice neighborhoods which they had bought in their 20s and 30s. These homes had been paid off for years, and they managed to accumulate a lot of wealth when they no longer had to make house payments.
On the other hand, those who bought McMansions were trying to sell and downsize in a down market. They needed equity from their homes to enjoy financial independence in their golden years.
Financial independence and happiness comes to those who live within their means and make wealth accumulation a major priority. Financial independence is relative, and your attitude plays a big role. For some, financial independence means living in a doublewide in a 55-plus community; for others, it means million-dollar homes and five-star travel. My wife and I have friends in both camps, and it makes no difference: they have all put themselves in a position to enjoy a lifestyle they can afford without major financial worry.

Pillar #3: Never Go into Debt to Buy a Toy

This is a personal favorite. Whatever your toy of choice—a boat, motorhome, four-wheeler, you name it—if you want it badly enough, save the money to buy it. Interest rates on toys are exorbitant because they depreciate so rapidly. I have too many friends who borrowed thousands of dollars for a boat, made extra payments, and still had to write a check to the loan company when they sold it. I get it! It's damn tempting, but just don't do it.

Pillar #4: Consider the True Cost, Not the Monthly Payment

This is tough when you have the hots to buy something. If you cannot purchase something outright, its true cost includes the price of renting someone else's money, plus the depreciation.
Thinking in terms of monthly payments can keep a person in economic slavery for life. We've all seen folks get a nice raise and immediately buy more cool stuff because they now can afford more monthly payments. This is nothing more than a treadmill of earning income and making payments, with little chance of real wealth accumulation.
We're investors in Lending Club and see hundreds of loan applications from people who've finally realized that financial independence requires accumulation of wealth, not stuff. They borrow money to consolidate their debt, cut up their credit cards, and try to get back on track. This can easily take 5-10 years for folks with massive debt. If they finally get it at 50, they may have to set retirement back a full decade or more.

Pillar #5: Wants Are Not Needs

Wealth accumulation and financial independence must trump the "need" for stuff. Throw off the economic shackles! Financial freedom is attainable if you free yourself from stuff.

Pillar #6: You Are Responsible for Your Own Behavior

If you've ever been the parent of a teenage driver, at one point or another that teenager likely received a speeding ticket. The commonsense solution: make the teenager pay the ticket and any increase in the insurance. He who creates the problem should create the solution.

Pillar #7: Behavior Has Both Short- and Long-Term Consequences

By our 50th class reunion, we'd lost many classmates to lung cancer. These were the same kids who'd laugh as they lit up a cigarette and call them "cancer sticks." They were quite right. Incredibly, many of them, knowing the risk, smoked right up until the end; they didn't change their behavior and suffered the consequences.
It's not like big spenders don't know the consequences of not saving; they've heard the message before. Yet they continue the same behavior and end up with a predictable result: little to show for their efforts at the end of their working career. Some people justify their behavior by thinking they can live on Social Security post-retirement. The few I know who are in that situation are not financially independent; they're back working at lower-paying jobs they can ill afford to lose.

Pillar #8: No One Owes You Squat!

If you think anything is owed to you, prepare yourself for a rude awakening. Yes, that means you are responsible for your own retirement, health care, and everything else you need. While you may have a pension or guaranteed healthcare plan today, check the promises made by the government or your employer. Many of those promises are impossible to keep.
Too many people retired counting on their pensions—public and private. These folks kept up their end of the bargain, but that makes little difference when there's no money to pay them. Future generations need to learn from those mistakes.
Some friends recently told us their children got jobs at the police and fire departments. They were pleased because they thought they could work hard, earn a decent living, and have a nice pension waiting for them in a few decades. Ask anyone who worked for the City of Detroit what they think about that plan.
Don't spend your money thinking you can count on others to support you in your old age. They might, but you'll lose your independence and probably not be happy. Too many people in this situation have never learned to save; they allowed someone else to do it for them. Save more than the minimum. You will never regret it.

Pillar #9: Something for Nothing Teaches a Bad Lesson

We've all heard stories of people winning millions in the lottery and quickly going broke. Ever heard of "Sudden Wealth Syndrome?" There is such a thing, and it's completely related to a huge (often unearned) windfall.
Why do seemingly intelligent people who suddenly have a lot of money blow it? Their first reaction is to look at all the cool stuff they can buy. If you win $10 million and buy a $2 million home, you still have $8 million left. Then again, if you also bought a $1 million boat you still have $7 million left, much more than you ever had before. That rationale soon leads people right down the drain, and the money is gone.

Pillar #10: Live off the Interest and Never Touch the Principal

I saved the most important pillar for last.
In the case of lottery winners going bust, it's almost always the same: If you won $10 million and invested it wisely, you could easily net $500,000 a year while your portfolio grew ahead of inflation. In most cases, the income from their winnings could provide a phenomenal lifestyle. And they could pass along the money and sound financial principles to their children.
I recall Johnny Carson discussing having a lot of money with Bert Reynolds. Carson commented, "Having money means you never have to worry about money." While that contains some truth, it's an oversimplification. You also don't have to worry about all the things you have to do to earn money. That's what causes stress and takes years off of our lives.
Having money is important, but it's only part of the puzzle. Understanding what money means, what it can do for you, and prioritizing wealth accumulation are also critical pieces.

If I have to make a choice between leaving my children and grandchildren with money or the basic principles of growing and maintaining wealth, I'd choose the education every time. It will make them hell-bent on keeping the money they earn and educating the next generation to do the same.

http://www.millersmoney.com/editoria...l-independence

**barbaro** · 29-01-2014, 08:37 AM

Announcements have already benn made. Retails jobs being cut by Target and other stores will close. Vid is in the link. It's a quickie.

A 'tsunami' of store closings expected to hit retail

Big retailers to close stores: Pro
Wednesday, 22 Jan 2014
John Kernan, Cowen & Co. vice president, discusses if turning retailers like Sears and J.C. Penney into a REIT-like entity is an alternative.

Get ready for the next era in retail—one that will be characterized by far fewer shops and smaller stores.

On Tuesday, Sears said that it will shutter its flagship store in downtown Chicago in April. It's the latest of about 300 store closures in the U.S. that Sears has made since 2010. The news follows announcements earlier this month of multiple store closings from major department stores J.C. Penney and Macy's.

Further signs of cuts in the industry came Wednesday, when Target said that it will eliminate 475 jobs worldwide, including some at its Minnesota headquarters, and not fill 700 empty positions.

Experts said these headlines are only the tip of the iceberg for the industry, which is set to undergo a multiyear period of shuttering stores and trimming square footage.

Shoppers will likely see an average decrease in overall retail square footage of between one-third and one-half within the next five to 10 years, as a shift to e-commerce brings with it fewer mall visits and a lesser need to keep inventory stocked in-store, said Michael Burden, a principal with Excess Space Retail Services.

Entire: A 'tsunami' of store closings expected to hit retail

**barbaro** · 30-01-2014, 11:44 PM

I'm changing my view on Schiff slowly but surely, and I've been following him for a few years.

Please watch and comment:

**barbaro** · 01-02-2014, 08:16 AM

This cannot be good.

Dow Jones Industrial Average, S&P 500: NYSE Margin Debt Hits An All-Time High
January 29th, 2014

Doug Short: The New York Stock Exchange publishes end-of-month data for margin debt on the NYXdata website, where we can also find historical data back to 1959. Let’s examine the numbers and study the relationship between margin debt and the market, using the S&P 500 as the surrogate for the latter.

The first chart shows the two series in real terms — adjusted for inflation to today’s dollar using the Consumer Price Index as the deflator. I picked 1995 as an arbitrary start date. We were well into the Boomer Bull Market that began in 1982 and approaching the start of the Tech Bubble that shaped investor sentiment during the second half of the decade. The astonishing surge in leverage in late 1999 peaked in March 2000, the same month that the S&P 500 hit its all-time daily high, although the highest monthly close for that year was five months later in August. A similar surge began in 2006, peaking in July 2007, three months before the market peak.

The latest data puts margin debt as at an all-time high, not only in nominal terms but also in real (inflation-adjusted) dollars.

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The next chart shows the percentage growth of the two data series from the same 1995 starting date, again based on real (inflation-adjusted) data. I’ve added markers to show the precise monthly values and added callouts to show the month. Margin debt grew at a rate comparable to the market from 1995 to late summer of 2000 before soaring into the stratosphere. The two synchronized in their rate of contraction in early 2001. But with recovery after the Tech Crash, margin debt gradually returned to a growth rate closer to its former self in the second half of the 1990s rather than the more restrained real growth of the S&P 500. But by September of 2006, margin again went ballistic. It finally peaked in the summer of 2007, about three months before the market.

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After the market low of 2009, margin debt again went on a tear until the contraction in late spring of 2010. The summer doldrums promptly ended when Chairman Bernanke hinted of more quantitative easing in his August, 2010 Jackson Hole speech. The appetite for margin instantly returned, and the Fed periodically increased the easing until the beginning of tapering purchases supposedly now underway.

The latest Margin Data

Unfortunately, the NYSE margin debt data is a few weeks old when it is published. Real margin debt at the end of December 2013, the latest available data had accelerated over the previous four months. If the acceleration prior to the two previous peaks offers a clue, margin debt could see some further growth.

NYSE Investor Credit

Lance Roberts, General Partner & CEO of Streettalk Advisors, analyzes margin debt in the larger context that includes free cash accounts and credit balances in margin accounts. Essentially, he calculates the Credit Balance as the sum of Free Credit Cash Accounts and Credit Balances in Margin Accounts minus Margin Debt. The chart below illustrates the mathematics of Credit Balance with an overlay of the S&P 500. Note that the chart below is based on nominal data, not adjusted for inflation.

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Here’s a slightly closer look at the data, starting with 1995. Also, I’ve inverted the S&P 500 monthly closes and used markers to pinpoint the monthly close values.

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As I pointed out above, the NYSE margin debt data is a several weeks old when it is published. Thus, even though it may in theory be a leading indicator, a major shift in margin debt isn’t immediately evident. Nevertheless, we see that the troughs in the monthly net credit balance preceded peaks in the monthly S&P 500 closes by six months in 2000 and four months in 2007. The most recent S&P 500 correction greater than 10% was the 19.39% selloff in 2011 from April 29th to October 3rd. Investor Credit hit a negative extreme in March 2011.

There are too few peak/trough episodes in in this overlay series to take the latest credit-balance trough as a definitive warning for U.S. equities. But we’ll want to keep an eye on this metric in the months ahead.

This article is brought to you courtesy of Doug Short from Advisor Perspectives.

http://etfdailynews.com/2014/01/29/d...all-time-high/

**barbaro** · 25-03-2014, 09:09 PM

Incomes declining, under-employment and and unemployment high, an expanding job base of low paying service sector jobs with no bennies.

And of course that means.....

Out of Gas: Most Americans Can't Afford New Cars
Ben Popken
March 25, 2014
NBC News
For many Americans, new cars are driving out of reach.

Jose Hernandez, 24, lives in East Los Angeles and makes $26,000 a year working the front desk at a clinic. After a trade-in, he financed a 2013 Civic EX for $25,000 at 2.3 percent for 6 years, paying $379 in monthly payments, plus $100 per month in insurance. He finds a new car can be a stretch.

"I believe most cars are slightly out of reasonable price range for the average American, especially considering most 'affordable' cars don't last very long and lose a lot of value rather quickly," he said.

For many Americans, a car isn't a way to get from point A to point B, it's freedom. The promise of an automobile goes beyond the thrill of the open road or being able to get a late-night pint of ice cream when you want. With a car, you've arrived. And with a car, you can always leave. Social mobility, a new life in a new town, used to be just a black ribbon of interstate away.

Now, amid stagnant wages and a shaky recovery, the average new car price rose last year by $1,536.

"Americans can only afford used cars," said Louis Hyman, an assistant professor in the labor relations, law, and history department at Cornell University. "The recovery has only been for those at the top and not for normal Americans."

Car ownership has long sat at the core of what it means to "make it" in this country. If you want to get to and around the suburbs, you'll need to drive.
It's an aspiration that's slipped from the grasp of most, as a new report finds the average new car unaffordable for the average American family in 24 of the 25 largest U.S. metro areas.

Except for Washington, D.C., median-income households in those areas fell shy of the $32,086 in annual salary required to buy an average new car, the Interest.com analysis found.

Car shopping evolves
CNBC auto reporter Phil LeBeau breaks down the evolution of the car-buying business.
"The consumer gets to the end of the month and discovers they have no money left in their checking account," said Interest.com managing editor Mike Sante. "They've spent every cent they have and wonder how on earth they're supposed to save for their retirement or their kids' education."

Entire: Out of Gas: Most Americans Can't Afford New Cars

**panama hat** · 27-03-2014, 11:21 AM

Originally Posted by barbaro

I'm changing my view on Schiff slowly but surely

How are you changing your mind about the guy? What did you think about him years ago and what do you think about him now and why?

**Iceman123** · 27-03-2014, 03:35 PM

^^
If you earn 26k pa - I do not think you should be financing a car for 25k

**thailazer** · 27-03-2014, 03:40 PM

Originally Posted by Iceman123

^^
If you earn 26k pa - I do not think you should be financing a car for 25k

Agreed. But that shows the mentality congress is using.

**panama hat** · 27-03-2014, 07:47 PM

Originally Posted by barbaro

For many Americans, a car isn't a way to get from point A to point B, it's freedom.

Utter bollocks . . . with a decaying public transport system, if there is one at all due to short-sighted strategic planning and bluster about 'CARS' . . . having a car is a necessity for many.

Freedom . . . what a load of seppo bollocks

**barbaro** · 27-03-2014, 08:31 PM

^ OckerR,

I do not agree with that quote / comment.

It was in the article.

No, I do not see "freedom" at all in driving a car.

It's a bizarre and puerile past fantasy.

**panama hat** · 28-03-2014, 07:02 AM

I didn't think you would - it's a ridiculous notion - the quote function is inadequate at times.

I was referring to our previous comment about that dickhead, Schiff:

Originally Posted by barbaro

I'm changing my view on Schiff slowly but surely, and I've been following him for a few years.

How have you changed your mind about him and what was it previously?

**robuzo** · 28-03-2014, 09:59 AM

"Americans can only afford used cars," said Louis Hyman
---
The thing is, the "used cars" available now are not your father's "used cars." Why anyone still feels the need to drive a virgin automobile off a lot- does losing 40% (bare minimum) of what you just spent actually feel that good? When you can buy a two-year-old car that has been meticulously cared for and lose only 15% when you drive it away?

The problem Americans have is their economy is maturing ahead of them.

**barbaro** · 29-03-2014, 01:06 PM

Originally Posted by OckerRocker

How have you changed your mind about him and what was it previously?

I disagree with his view more and than before. For example, his take on not having a minimum wage at all.

(I was never a Libertarian ideologue.)

I still think he is sound on the Fed's actions and what the national govt. is doing with fiscal policy, however.

**Norton** · 29-03-2014, 01:45 PM

Originally Posted by robuzo

Why anyone still feels the need to drive a virgin automobile off a lot- does losing 40% (bare minimum) of what you just spent actually feel that good?

New car a must have if you love Maddie.

**panama hat** · 29-03-2014, 02:10 PM

Originally Posted by barbaro

I disagree with his view more and than before. For example, his take on not having a minimum wage at all.

Whew. I was afraid you'd like that kind of ridiculous 'I've got mine' thinking

Thread: The strongest economy in the world

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