Thursday, July 30, 2009

Cash for Clunkers running on empty

Wow, I guess that's why I'm not in the car business. According to reports tonight, the Cash for Clunkers program went from having $779 million still eligible for funding as of Thursday morning to being overdrawn by Thursday night. That means that roughly 225,000 cars were sold in a DAY (as point of reference that's almost equal to all the cars sold in the US every month)?!?!?! Hmmm, I think somethings not right with that number.

My suspicion is that car dealers might have had 3 - 5 applications per day this week and decided to game the system a bit. Maybe they found a loophole where they could file an application for funding with "details to follow". If a dealer had a block of 50-100 clunker applications on file it they would save their space in the line of dealers waiting for the rebates and find customers to file the final applications over the coming months.

Like I said, I've read through the red tape associated with this program and it is substantial. I can't believe that 250,000 consumers had eligible vehicles, that were insured/registered (with documentation - just getting DMV registration info can take days) and acceptable credit to buy that many cars in just a couple of days.

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The markets continue to wind higher on the expectation that things continue to get worse more slowly. However, lots of signs of a top seem to be popping up --- Kudlow and Cramer both calling for new bull markets, Nasdaq acting like it did in Jan 2000 (remind me what happened in the 7 years after Jan 2000?), etc, etc.

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File this under "Reasons to focus on MATH!!!"

In a recently released survey of starting salaries for college graduates you'll see a trend - engineering and math related fields....

Top 10 College Degrees by Highest Starting Salary
Petroleum engineering - $83,121
Chemical engineering - $64,902
Mining engineering - $64,404
Computer engineering - $61,738
Computer science - $61,407
Electrical Engineering - $60, 125
Mechanical Engineering - $58,766
Industrial Engineering - $58,358
Systems Engineering - $57,438
Engineering Technology - $56,447

The list is probably a little skewed by the recent surge in commodity prices that has allowed companies to pay more for new graduates, but the message is clear - math first, second and third, and focus on science during your breaks :)

Wednesday, July 29, 2009

Healthcare Reform?

I imagine that most loyal readers have picked up on my natural skepticism of pretty much everyone and everything. So when I read something like...

"Drugmakers May Fund $100 Million Ad Campaign on Health Overhaul

July 28 (Bloomberg) -- Drugmakers may ramp up their push for an overhaul of the U.S. health care system by spending $100 million on ads starting as early as September, said a person familiar with the discussion. "

I get really suspicious.

Why would the principal lobbying group for the pharmaceutical industry propose spending $100 million in advertising to support a plan that aims to reduce their revenues by $80 billion over 10 years. Unless.................

Could they know about a loophole that might lead to higher revenues that would more than offset the sales would lose if they cut the cost of certain drugs?

I'll put on my cynic's hat and take a stab at it.....

1) The pharma companies know that this change is coming and want to appear as though they are part of the solution rather than part of the problem.

2) They offer to cut the cost of some medicines over 10 years but don't have to deliver those cost savings because no one will be able to track the "savings"

3) The new health plan will substantially increase the number of insured people in the US. The more people who are insured, the more pharmaceuticals that can be sold by the big pharma companies.

Now maybe they really want to be part of the solution, but I have my doubts....

The health care debate is mostly a political one and one that I'd rather avoid, but when it crosses into the world of business I feel compelled to comment.

* Note: This ad campaign was projected to start in September, but I've seen ads popping up already.

As Sammy Hagar said "I can't drive 55!"

It's all cars all the time right now in my household so I'm a little obsessed with the issue of cars at the moment (disclosure: I've got an old Suburban that will be put out to pasture and replaced by a new vehicle getting 30mpg+ thanks to the cash for clunker program).

Consider this chart via Bloomberg that shows the discrepancy between unit sales of cars in the US and China in recent years. This is not an entirely accurate representation of the markets because almost half of all vehicle sales in the US are light trucks but the trend is clear - China's market has seen explosive growth while the US has spun it's wheels. Admittedly, the cash for clunkers might provide a small, short term boost but 250k cars is a small piece of a market that buys 10 million to 16 million cars. If I were running GM I'd try to figure out ways to build more cars that appeal to the Chinese market (GM's actually pretty successful in China already but they should try to gain market share).




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Just in case you thought that the cash for clunkers might program might save the domestic car manufacturers consider the top 10 most researched vehicles at Edmunds.com....

Most Popular
1. Honda Civic
2. Honda Accord
3. Honda CR-V
4. Mazda MAZDA3
5. Toyota Prius
6. Volkswagen Jetta
7. Chevrolet Camaro
8. Toyota Camry
9. Honda Odyssey
10. Toyota RAV4

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Cheers!

Sunday, July 26, 2009

Cash for Clunkers...

By now you've undoubtedly seen one of the 14,502 different commercials running on TV from the different car companies begging you to trade in your clunker for $4,500 toward a new car!!!

I'm particularly bothered by some of the car companies that seem to imply that the rebate is coming from them rather than a government credit. Also, the implication in the ads is that any old car will qualify when the reality is that very, very few cars and trucks will qualify.

Here are the details as I know them today courtesy of the government's website - www.cars.gov.

*** Note that the final document is a whopping 136 pages of legal nonsense. I'll try to highlight the key items.

* Your vehicle must be less than 25 years old on the trade-in date
* Only purchase or lease of new vehicles qualify
* Your vehicle must get 18 or less MPG
* Trade-in vehicles must be registered and insured continuously for the full year preceding the trade-in
* The program requires the scrapping of your eligible trade-in vehicle, and that the dealer disclose to you an estimate of the scrap value of your trade-in. The scrap value, however minimal, will be in addition to the rebate, and not in place of the rebate.

You also need to show
1) 1 Year Proof of Insurance. If your insurance card does not cover the entire year preceding the trade in, you will need other proof of insurance. Contact your insurance company to get evidence of 1 year worth of insurance. The form must include, at a minimum, the insurance company, policy number, VIN, start and end date of insurance (showing at least 1 year).
Proof of Registration going back at least 1 year.

2) Must have “Clear” title. This means you can't owe anything on the car or truck.

My favorite quote in the FAQ document - "even though a passenger car may
be quite old and/or in poor condition, it may not be an eligible trade-in vehicle under the
program because its combined fuel economy at the time of its manufacture (as measured
by the EPA) exceeds statutory limits. Some consumers have expressed surprise at this
result."


So to summarize, you must have an old vehicle that you own free and clear, that had a combined EPA estimate below 18 when new, that is drivable, that is insured, that is registered, and you have to buy a new vehicle that improves your MPG by 10 MPG to qualify for the max rebate. Sounds like it might drive a lot of traffic into dealerships, but I think many consumers will be surprised when they actually get into the details.
For the talk of sunshine just over the horizon the true data tied to manufacturing economy remains surprisingly bleak. From the Railroad Transport industry's June data....

*Carloads originated on U.S. railroads in June 2009 were down 19.5% (252,078 carloads) from June 2008 to 1,037,928 carloads. June 2009 was the eighth straight double-digit monthly carload decline, but it was a smaller decline than the previous two months. Average weekly carloads in June 2009 (259,482) were 10,311 carloads higher than in May 2009.

• For the second quarter of 2009, U.S. rail carloadings were down 22.2% (945,652 carloads); second quarter intermodal traffic was down 18.3% 538,345 trailers and containers).

Despite their implication that June's decline was a "smaller decline than the previous two months" I would note that historically June experiences a sharp monthly uptick so June's "slower rate of decline" is likely little more than seasonality.

A little closer to home consider the fact that St. Lawrence Seaway traffic has plunged 36% in 2009.

"Freight traffic on the St. Lawrence Seaway slumped nearly 36 percent in the first third of the navigation season. The fall would have been worse but for strong shipments of grain to Europe and the Mediterranean.

The Canadian and American Seaway corporations reported that traffic through June 30 from season-opening March 31 fell to 9,024,000 metric tons of cargo, down 35.7 percent from 14,045,000 in the period last year."

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There have been more than a few people questioning the ability of firms like Goldman Sachs to truly be trading so successfully in this environment. This article in the NY Times might explain some of their advantage (although the article doesn't specify Goldman, I think it's implied that all of the big banks are engaging in this sort of trading.).

"It is called high-frequency trading — and it is suddenly one of the most talked-about and mysterious forces in the markets.

Powerful computers, some housed right next to the machines that drive marketplaces like the New York Stock Exchange, enable high-frequency traders to transmit millions of orders at lightning speed and, their detractors contend, reap billions at everyone else’s expense.

These systems are so fast they can outsmart or outrun other investors, humans and computers alike. And after growing in the shadows for years, they are generating lots of talk.

Nearly everyone on Wall Street is wondering how hedge funds and large banks like Goldman Sachs are making so much money so soon after the financial system nearly collapsed. High-frequency trading is one answer.

Yet high-frequency specialists clearly have an edge over typical traders, let alone ordinary investors. The Securities and Exchange Commission says it is examining certain aspects of the strategy.

“This is where all the money is getting made,” said William H. Donaldson, former chairman and chief executive of the New York Stock Exchange and today an adviser to a big hedge fund. “If an individual investor doesn’t have the means to keep up, they’re at a huge disadvantage.”

The rise of high-frequency trading helps explain why activity on the nation’s stock exchanges has exploded. Average daily volume has soared by 164 percent since 2005, according to data from NYSE. Although precise figures are elusive, stock exchanges say that a handful of high-frequency traders now account for a more than half of all trades. To understand this high-speed world, consider what happened when slow-moving traders went up against high-frequency robots earlier this month, and ended up handing spoils to lightning-fast computers.

It was July 15, and Intel, the computer chip giant, had reporting robust earnings the night before. Some investors, smelling opportunity, set out to buy shares in the semiconductor company Broadcom. (Their activities were described by an investor at a major Wall Street firm who spoke on the condition of anonymity to protect his job.) The slower traders faced a quandary: If they sought to buy a large number of shares at once, they would tip their hand and risk driving up Broadcom’s price. So, as is often the case on Wall Street, they divided their orders into dozens of small batches, hoping to cover their tracks. One second after the market opened, shares of Broadcom started changing hands at $26.20.

The slower traders began issuing buy orders. But rather than being shown to all potential sellers at the same time, some of those orders were most likely routed to a collection of high-frequency traders for just 30 milliseconds — 0.03 seconds — in what are known as flash orders. While markets are supposed to ensure transparency by showing orders to everyone simultaneously, a loophole in regulations allows marketplaces like Nasdaq to show traders some orders ahead of everyone else in exchange for a fee.

In less than half a second, high-frequency traders gained a valuable insight: the hunger for Broadcom was growing. Their computers began buying up Broadcom shares and then reselling them to the slower investors at higher prices. The overall price of Broadcom began to rise.
Soon, thousands of orders began flooding the markets as high-frequency software went into high gear. Automatic programs began issuing and canceling tiny orders within milliseconds to determine how much the slower traders were willing to pay. The high-frequency computers quickly determined that some investors’ upper limit was $26.40. The price shot to $26.39, and high-frequency programs began offering to sell hundreds of thousands of shares.

The result is that the slower-moving investors paid $1.4 million for about 56,000 shares, or $7,800 more than if they had been able to move as quickly as the high-frequency traders.

Multiply such trades across thousands of stocks a day, and the profits are substantial. High-frequency traders generated about $21 billion in profits last year, the Tabb Group, a research firm, estimates. "

Cheers!

Thursday, July 23, 2009

Be careful reading too much into these rallies...

The market continues to show remarkable "headline strength". When I opened up my laptop this afternoon every financial website was screaming "DOW PASSES 9,000", "STOCKS AT HIGHEST LEVEL IN 8 MONTHS!!", etc.

All of these facts are true, but I continue to get the sense that this is driven by:

* greedy day-traders
* technicals, not fundamentals
* a smaller and smaller pool of stocks

The consistent theme this quarter has been that companies have dramatically cut costs (likely because they feel the recession will be long and deep) and because of these cost cuts earnings have been a little better than expected. However, consider two scenarios:

Company A is growing a 50% a year and hiring like madmen. They are expanding in China and India and as a result of this growth their earnings were 2% below analyst expectations.

Company B has cut 30% of its staff and shut 10 plants in the past year. They are looking at more closings in 2009 and 2010. They "beat expectations" by 3% in the second quarter.

Which stock do you want to buy for the long haul? Right now the market is loading up on Company B's stock and that should scare us all.

This Quote of the Day echoes my sentiments:

"Who needs earnings in this casino barely disguised as a market? Nobody’s investing anymore anyway. It’s all just numbers going up and down with no real meaning behind any of them"

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People that agree with me always occupy a special place in my heart. When you are a prominent economist at Harvard, then I get all warm and fuzzy inside...

"The U.S. recession may not be coming to an end and there is a risk the economy may experience a “double-dip” contraction, said Martin Feldstein, a professor of economics at Harvard University.

The economy could “flatten out” or “even be positive” in the third quarter, and then it’s likely to contract again in the last three months of the year as the effects of the federal stimulus program wear off and companies finish rebuilding inventories, he said.

“There isn’t going to be enough to sustain a really solid recovery,” he said, even though recent data has provided some “good news” on the economy."

This meshes perfectly with my thinking that things look better in the second half before we take another leg down in 2010. With mid-term elections occurring 2010, the next series of bailouts might be interesting....

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Just when I think I'm about as the most negative person I know I find someone that reminds me that I'm a happy go lucky sort of guy....


Sprott Comment July 2009



Wow.

Cheers!

PS - I'm going to touch base on the cash for clunkers deal again tomorrow, there's too much misinformation floating around about this program (who would think car dealers might be a little less than forthright?).

Monday, July 20, 2009

Goldman says the sun will come out tomorrow

Well, it's pretty easy to be optimistic when you're looking at the biggest bonus pool in the history of Wall Street. I hate to join the list of Goldman bashers because it is starting to attract the lunatic fringe, but the irony of Goldman upping their outlook for the markets after heavily investing in the US markets is not lost on me. This would be like me cornering the market in first edition Beanie Babies and then forecasting that the price would rise by year-end.

However, the chorus of "Rally, Rally, Rally" has been growing all week despite what I view as weak operating results from the majority of companies (admittedly a few financial firms have given us the "things are declining at a slower pace" line again). Jim Cramer - the Clown Prince of retail investors - has been getting revved up lately and that's usually good for another 5% run :).

I think the voodoo masters - I mean technicians - continue to rule the day and now that we've surpassed 950 on the S&P there is a good chance we could go higher. However, we've been in this vicinity at least 4 different times in the past 8 months and the market has failed to go higher every time.

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The US dollar has weathered the crisis surprisingly well in my opinion. However, if we take a double dip in 2010 as I expect, the policymakers will have few options - another stimulus plan? lower interest rates again? - to stimulate demand. I think we'll have to watch the prospects for the US dollar in 2010 if the economy remains weak. What does this mean to you? The biggest factor will be the impact on consumer prices if commodity prices soar again when the dollar weakens. $90 oil, $3.50 gas, higher food prices, etc, etc. But you're 401k should be rocking again by that time so don't worry about those little things:)

Sunday, July 19, 2009

Get out your rally caps!

I took a little breather last week, but the markets roared back to life on back of Goldman's tremendous trading revenue. It's important to note that Goldman (and any of the other big trading desks) are making massive profits off swings in the markets not any meaningful change in the economy. We'll see if people continue to chase this rally or if it stalls when non-financial companies start to report earnings.

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No news here, but state tax revenues are in free fall. Anyone that has driven recently in NYS has seen the latest push to increase state revenues..........I mean enhance safety --- through the implementation of speed traps. Via the NY Times

"All the major sources of state tax revenue — sales taxes, personal income taxes and corporate income taxes — took serious blows, the report found.

As more people lost their jobs, took pay cuts or worked fewer hours, personal income tax collections fell 17.5 percent in the quarter. Weak retail sales sent sales tax collections down 8.3 percent. Corporate income tax collections, which are often highly variable, declined 18.8 percent.

As bad as the first quarter was, the second quarter is shaping up to be even worse, the report said. Preliminary data for the first two months of the quarter, April and May, collected from 45 states, indicated that tax revenues declined by 20 percent compared with the same period last year.

That will force states — many of which are already raising taxes or fees, resorting to layoffs or furloughing employees — to come up with more ways to raise or save money."


The long-term prospects for NYS are not particularly bright, but the near-term outlook is painful. Can you imagine the rocket scientists in Albany trying to make a balanced decision on layoffs vs. tax hikes vs. spending cuts? Well, it should make for interesting TV.

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Unemployment math - There's going to be some skewing of the unemployment data over the next three months and I want all of my readers to be aware of the trend so that you won't fall for the headline when it hits the wire. The number of people unemployed that are about to have their benefits expire could hit 500k to 1.5 million before the end of the year. These people will disappear from the unemployment survey and some might try to spin this news as an indication of labor markets improving. While this is not the case, I won't be surprised if someone tries to package this as "good news".

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Finally, this is totally unrelated to the markets but I think you might enjoy a laugh at my expense.

I've had precious few moments to enjoy one of my real passions this year - fishing on the St. Lawrence. Tonight the wind was finally dying down and I decided to give it the old college try now that the water has warmed and the bass have moved into some local hotspots near Clayton. I decided not to take out my fishing boat because I expected to make it a quick trip and I didn't expect to go more than a half mile from my house (mistake #1). After traveling about 100 ft, I could tell that my trolling motor battery did not have an adequate charge to fight the wind so I dropped anchor at a nearby shoal. On my first cast I hooked a decent fish that was pulling drag so I was thrilled..... until I saw it roll over and I realized I'd hooked a giant channel catfish without any pliers or hook removers in the boat (mistake #2). I made one feeble attempt to remove the lure by hand and was rewarded with a one inch gash in my index finger (mistake #3).

By now I've decided that I have to get back to my dock and remove the lure with the proper tools, particularly since the 12 lb fish dragging my 9ft boat around the river was starting to attract a crowd of spectators on the nearby docks. I start paddling back to my dock (by now my battery had completely died) when I hear a splash....... my pole is now sitting on the bottom of the river, I'm gushing blood, my battery is dead and I'm just soooo thrilled that I decided to sneak in an hour of fishing before dark :)

I eventually fished my pole out of the river, limped my way back to the dock and released the fish unharmed (I wish I could say the same for my left finger - my concert piano days may be over). So, when you're having a rough day back at work after a long vacation (welcome back Mom!) just think "hey, it could be worse, I could be fishing" :).

Cheers!

Wednesday, July 08, 2009

Well, it's not news to my readers....

Distressed Commercial Real Estate has soared so far in 2009 and this has come as a shock to some people.

"Commercial properties in the U.S. valued at more than $108 billion are now in default, foreclosure or bankruptcy, almost double than at the start of the year, Real Capital Analytics Inc. said.

There were 5,315 buildings in financial distress at the end of June, the New York-based real estate research firm said in a report issued today. That’s more than twice the number of troubled properties at the end of 2008.

Hotels and retail properties are among the most “problematic” assets following bankruptcy filings by mall owner General Growth Properties Inc. and Extended Stay America Inc., according to the report. The scarcity of credit is causing property defaults in all regions and among every investor type, Real Capital said."

I'm a little surprised by the rate of deterioration (doubling in the first 6mths of 2009) but there is no doubt the US has a dramatic excess supply of commercial real estate and it's going to take many, many years to work off this excess inventory. As it relates to Upstate NY think about the two most problematic areas mentioned in the article - hotels and retail. Just about every new commercial property in Jefferson County in the past 4 years has been hotel or retail. I don't think I'd want to hold the loans on some of those properties.

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I hate to see the discussion about our nation's financial condition deteriorate into partisan bickering, but that apparently is the nature of the beast. I will note that the GAO report on the stimulus echoed my early concern that the stimulus wasn't really stimulating anything, rather it was being used to maintain the status quo.

"The report released Wednesday by the Government Accountability Office, Congress' investigative arm, found that the $787 billion stimulus package is being used to "cushion" state budgets, prevent teacher layoffs, make more Medicaid payments and head off other fiscal problems."

"For example, the GAO said about half the money set aside for road and bridge repairs is being used to repave highways, rather than build new infrastructure. And state officials aren't steering the money toward counties that need jobs the most, auditors found."

Anyone that has driven along a major interstate right now is aware of the substantial "repaving of America" that is underway. The problem with spending the stimulus money to plug gaps in state budgets is that it assumes state revenues will bounce back soon. However, as we continue to see from California to Massachusetts, tax revenues continue to come in below even the most pessimistic assumptions. This means big cuts in services and state jobs in 2010 or another round of stimulus (however, they'd be smart to call it something other than stimulus - call it what it is - emergency aid to states).

Cheers!

Monday, July 06, 2009

Well at least Washington's hiring....

One of my criticisms of both the Bush administration and the Obama administration has been their reliance on Wall Street insiders to "fix" Wall Street. It's difficult for someone who has worked in the industry for 20 years to suddenly see the light and push for real reform on Wall Street. It's not a new phenomenon for Wall Streeters to take up residence in Washington, but the flow of "talent" from Manhattan to K-Street has been surprising. Via counterpunch.org consider the following hires:



* Robert Hormats, Vice Chairman of Goldman Sachs, is to be installed as Under Secretary of Economics, Business, and Agricultural Affairs.


• Jacob Lew, Chief Financial Officer of Citigroup Alternative Investments Group, as Deputy Secretary of State(Lew’s dept. lost $509 million in the Q1 2008)


• Michael Froman, Citigroup, Deputy National Security Adviser for International Economic Affairs. Froman was formerly Chief of Staff to Robert Rubin at Treasury, before following him to Citi.


• Froman’s deputy, David Lipton, ran Citi’s global country risk management effort.


• Lewis Alexander, Citigroup’s chief economist and now Counselor to Treasury Secretary Timothy Geithner


• Neal Wolin, President and COO, Hartford Insurance Company, Property and Casualty Group now Deputy Treasury Secretary (Hartford received $3.4 billion in TARP funds).


• Gary Gensler, Goldman Sachs partner, now Chairman of the Commodity Futures Trading Commission



• Mark Patterson, Goldman Sach’s lobbyist, now Treasury Chief of Staff


The tinfoil hat crowd will notice a couple of names pop up frequently - Citi and Goldman.


Cheers!

Sunday, July 05, 2009

Weekend wrap-up

Well, the sun finally decided to make a cameo appearance in Upstate NY and everyone's feeling better. While, I'm on the subject of weather, I've got a question that I'd love to have someone clarify. When the local weatherperson says today's high will be 68 degrees, well below our average for this date of 81... do they really mean AVERAGE or do they really mean NORMAL? I suspect that it's really a normal temperature for a given date because our departure from AVERAGE every day is so substantial that eventually our average would start showing some real fluctuations.

On to news....

Swedish Banks now want customers to pay for the privilege of holding their money.

Well, about a year ago I joked that it wouldn't surprise me if we continue along our current path that punishes savers and rewards those that are leveraged to their eyeballs, if banks started charging you for the privilege of holding your money.

"Deep economic downturn
Economic activity abroad is very weak and this hits Sweden hard. Exports have fallen substantially and the situation on the labour market is continuing to deteriorate rapidly. The information received in recent months points to the economic downturn in 2009 being somewhat deeper than the Riksbank forecast in April.

Deposit Rate
The decision on the repo rate will apply with effect from Wednesday, 8 July. The deposit rate is at the same time cut to -0.25 per cent and the lending rate to 0.75 per cent."

That's not a misprint. Instead of paying interest on deposits, Swedish depositors will now PAY their banks 0.25% per year. Those banks might deserve to get a Jimmy Stewart style run on their deposits tomorrow.

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Congress is pushing for another short-selling ban.

Short sellers are not bad people. In fact, they are often the best educated investors in the market because they look through all of the happy, sunshine talk and delve into the reality of a business. Most 401k's would look better today if more short-sellers had been on CNBC in 2007 and 2008. A market without short selling is a rigged game designed to have one outcome. At a time when investors around the globe are getting increasingly nervous about their US holdings this sort of move might push global investors to reallocate assets elsewhere.

Also, it should be noted that short-selling puts a floor in stock prices and often stops rapid stock price swings like the ones we saw last October when a short-selling ban was in effect.

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I've also expected that local assessments were going to start getting appealed on a pretty wide basis and this story seems to back up that theory....

"Officials in some states say their property tax revenue is falling for the first time since World War II.

The recession has already taken a significant toll on states’ budgets, as rising joblessness, a weak business climate and a drop in consumer demand have cut sharply into receipts from taxes on sales, personal income and business earnings.

The pain at the state level is trickling down to county and local governments. To compensate, about 10 percent of large counties are raising the tax rates associated with home values to minimize the revenue loss, the county association said.

Even so, most counties simply have to absorb the lost revenue. Municipalities are laying off workers, renegotiating labor contracts, freezing salaries and cutting services.

The revenue losses are coming as homeowners prod towns for new assessments, and as municipalities conduct regular revaluations of their real estate. While declining residential values weigh heaviest on many governments, the value of commercial real estate is also sliding as businesses shut down and move out of storefronts or shopping malls.

But officials across the country say there is no question that the number of appeals has risen from the usual trickle to a flood."


The most likely scenario is that municipalities will lower assessments and raise tax rates to offset the change. It won't be popular, but once one town cracks and raises taxes it will spread through a county faster than the H1N1 virus.

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If you get a chance to catch a repeat of the Pete Peterson interview on Charlie Rose sometime it's valuable use of your time. Mr. Peterson has embarked on a campaign to change our habit of running perpetual consumer and federal deficit. I hope to be able to stay as informed on the global economy as Mr. Peterson when I grow up.

Wednesday, July 01, 2009

Save the newspapers by killing the web....

A couple of blogs have picked up on a post written by a US Appeals Court judge last week. In essence, the idea is to give news outlets exclusive rights to their stories without allowing linking from other news aggreators (think Drudge or locally our own Newzjunky).

"Expanding copyright law to bar online access to copyrighted materials without the copyright holder's consent, or to bar linking to or paraphrasing copyrighted materials without the copyright holder's consent, might be necessary to keep free riding on content financed by online newspapers from so impairing the incentive to create costly news-gathering operations that news services like Reuters and the Associated Press would become the only professional, nongovernmental sources of news and opinion."

I can't imagine that this would gain traction as the linking horse has left the barn --- what would Twitter, Facebook, etc, be without links? However, some connected media members are also floating the idea of making content "exclusive" for a certain time period (24 hrs for example) before allowing links. This could become a big story if it gets any traction. You can read the entire post here... --- for now, until it becomes illegal to link to other posts :)

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I meant to throw up these photos the other day, but it got lost in a pile of housing and jobs data.
I was in the market for a nice 12 foot aluminum boat or maybe a sailfish sailboat until this concept boat caught my eye.
I love the fact that with a 250 ft yacht in the middle of the greatest body of water on the planet, this boat needs a pool on the main deck.
It's a yacht, it's a small country, it's a floating Nike size 42....:)
Just in case 250 fee doesn't quite meet your needs, this 300 foot prototype should fit the bill.
If anyone sees one of these on the River, let me know :)