Last week we learned that new home sales for May reached an all-time low–not good.
Yesterday, the Conference Board released its consumer confidence report and it wasn’t pretty:
…[T]he Conference Board’s consumer confidence index dropped 9.8 points to 52.9 in June, below the lowest estimate of 71 economists surveyed by Bloomberg News. A regional breakdown shows three of the four areas with the biggest declines border the Gulf of Mexico.
Sentiment plunged by 18 points in the East South Central, which includes Mississippi and Alabama. Confidence fell by 14 points in the South Atlantic, which includes Florida, and dropped by 11 points in the West South Central, where Louisiana is located. The Middle Atlantic states of New York, Pennsylvania and New Jersey saw a 12 point decrease.
No doubt the oil spill has played a significant role in plunging consumer confidence. But it still doesn’t account for all of it (note the 12 point decrease in the NJ-NY-PA region):
Confidence dropped more than would be suggested by the decrease in the Conference Board’s employment figures [...] indicating there may be more at play in depressing sentiment.
Lynn Franco, director of the Conference Board’s Consumer Research Center is less convinced. “The fact that we had a decline in a majority of regions speaks to the greater issue,” she said in an interview from New York. “It really does come down to jobs, and that is something that is impacting consumers across the board.”
And when consumer confidence is lagging, they, you know, don’t buy stuff:
Consumers’ plans to buy automobiles, appliances and homes declined in June, with the percentage of people who said they intend to buy a car dropping to the lowest since records began in 1967, today’s report showed. Vacation plans also fell.
People buying stuff is a big part of what keeps the American economy humming, so none of this is good news. And let’s not forget unemployment at 10%. Not good.
But all of this bad news doesn’t stop the Obama propaganda machine from rolling along:
“The economy is strengthening, we are into recovery,” Obama said, shortly after new figures showed that consumer confidence, a key economic indicator, had tumbled in June, sending stock markets worldwide plummeting.
We can’t have facts from economic data get in the way of a great fantasy. This is nothing but pure propaganda. The White House knows that it can’t afford to lose the American people on the economy. Not with elections coming up in November and reelection in a little over two years away.
We can’t have Obama-led government incompetence suck up all the oxygen in the room now, can we?
That wouldn’t be prudent:
In the wake of the BP oil spill in the Gulf of Mexico, President Obama today summoned a bipartisan group of over 20 senators to the White House to push for energy and climate change legislation.
But one thing the President did not want to talk about at the meeting was the BP disaster, a Republican source told ABC News. And that, the source said, led to a pointed exchange with GOP senator Lamar Alexander from Tennessee.
“The priority should be fixing the oil spill,” Alexander told the President, according to the source. “That’s what any meeting about energy should be about.”
But when Alexander tried to interject the BP leak into the meeting, the source said, the President told the senator, “That’s just your talking point.”
Retorted Alexander, “No, it’s my opinion.”
Senator Alexander made the critical mistake of highlighting a situation where government is not only not a solution, but impeding progress towards a solution.
Given that the Barack Obama is all about bigger and intrusive government, bringing up such issues are verboten. Government, and by extension, Barack Obama, can only do good things.
Once again, it’s all about Obama. Narcissism prevails in this White House.
The former Bloomberg reporter/CNBC host is mad as hell by golly, and he’s not taking it anymore:
On most cable newscasts, the people who are writing new financial regulations are called congressmen. But on “The Dylan Ratigan Show” on MSNBC, some are called “banksters.”
That term, a twist on gangsters, tells viewers a lot about Mr. Ratigan, a financial news apostate who has transformed himself into an outspoken opponent of too-big-to-fail banks and the politicians whom he calls their servants. In the recent fight over financial reform, he lent a megaphone to people who wanted an end to “too big to fail,” and he called on viewers to lobby the Senators in his imaginary Bankster Party.
All this from a man who, until recently, hosted a stock-picking show on CNBC, the cable personification of Wall Street. Now Mr. Ratigan, who labels himself a taxpayer advocate, rails against the “vampire” banks who “have assumed control of our government.”
Mr. Ratigan underwent a “Lou Dobbs-like transformation,” from sober-minded journalist to all-out advocate, said Andrew Leckey, the president of the Donald W. Reynolds National Center for Business Journalism at Arizona State University.
In a nod to his old network, Mr. Ratigan said that CNBC “does more good than bad,” because it “still shines the light on the debate about ideas in the financial markets.” But MSNBC seems to be a better platform than CNBC for a political crusade against corruption, said Mr. Ratigan, 38, whose one-year anniversary at MSNBC will come on Tuesday.
Good grief. Doesn’t this all smell of crass opportunism? A lame attempt by MSNBC to get themselves a shrill, pseudo-populist for their network?
If there’s any question about the reasons behind the downfall of the MSM, look no further than Dylan Ratigan–man of the people!
The Rolling Stone article aside, perhaps there was something more to the McChrystal firing last week:
…[T]he “campaign overview” left behind by General McChrystal after he was sacked by President Barack Obama last week warned that only a fraction of the areas key to long-term success are “secure”, governed with “full authority”, or enjoying “sustainable growth”. He warned of a critical shortage of “essential” military trainers needed to build up Afghan forces – of which only a fraction is classed as “effective”.
He pinpointed an “ineffective or discredited” Afghan government and a failure by Pakistan “to curb insurgent support” as “critical risks” to success. “Waning” political support and a “divergence of coalition expectations and campaign timelines” are among the key challenges faced, according to the general.
It was this briefing, according to informed sources, as much as the Rolling Stone article, which convinced Mr Obama to move against the former head of US Special Forces, as costs soar to $7bn a month and the body count rises to record levels, because it undermined the White House political team’s aim of pulling some troops out of Afghanistan in time for the US elections in 2012. In addition to being the result of some too-candid comments in a magazine article, the President’s decision to dispense with his commander was seen by the general’s supporters as a politically motivated culmination of their disagreements.
The comments made in the article by McChrystal’s inner circle were reason enough to be rid of the general. But I can never underestimate the ulterior motives of this President. He will never admit that the commander he chose for the campaign in Afghanistan was coming up short, and by extension so was his administration.
Just another shell game by the Obama administration.
It’s amazingly sad that the majority of the commentariat in the media and the blogosphere see the new regulation as actual “reform” with teeth, as something other than political theater:
Analysts pored over the specifics of the deal as they emerged on Friday and expressed a wide array of views about the impact it would have. Some saw the bill as more of a political statement than a practical measure that could prevent another financial meltdown. Others said banks’ costs would increase, but banks would pass the increased costs along to consumers.
Richard Bove, a banking analyst with Rochdale Securities, said the bill would not severely curtail banks’ operations.
“I don’t see there being a tremendous clampdown on the ability of banks to make money,” he said.
“The banks will have numerous methods of getting around the most onerous provisions in this bill to maintain their earnings growth,” he added. “But the things they will do will increase the cost of banking to everybody in this country.”
For instance, Mr. Bove pointed to last year’s credit card bill, which led banks to push up rates pre-emptively or reduce customers’ credit limits.
“You’re going to get a letter from your bank saying you now have to pay $1 to $15 a month to pay for this bill,” he said. “The banks are going to get the money back because the consumer is going to pay for the bill, and that’s the killer for the consumer.”
Every decade or so, a bubble happens, irrational exuberance reigns and markets overreach. Bubbles and bull markets, although not synonymous, are inevitable in free markets. It’s the nature of the beach. And whenever they burst or correct, politicians cry foul and demand bigger and “better” regulation. It happened after the crash of ’29, it happened after the dot-com bubble, and it’s happening again.
And every time it happens, chest-thumping politicians claim they are sticking up for the average American, when in fact, most of the time, the new regulations are superfluous and useless. What’s more, the average American is usually worse off.
Apparently, we’re on that ride once again.
Ninety minutes of fruitless attacks and blocked shots, plus yet another questionable call by a FIFA referee denying the USA a goal, and in the 91st minute Donovan punches one in:
If you can watch that goal and not get excited for World Cup soccer, then you’re hopeless.
Thank goodness Obama and the Democrats are really on the ball when it comes to the economy:
Sales of new homes collapsed in May, sinking 33 percent to the lowest level on record as potential buyers stopped shopping for homes once they could no longer receive government tax credits.
The bleak report from the Commerce Department is the first sign of how the end of federal tax credits could weigh on the nation’s housing market.
The credits expired April 30. That’s when a new-home buyer would have had to sign a contract to qualify.
“We fear that the appetite to buy a home has disappeared alongside the tax credit,” Paul Dales, U.S. economist with Capital Economics,” wrote in a note. “After all, unemployment remains high, job security is low and credit conditions are tight.”
New-home sales in May fell from April to a seasonally adjusted annual sales pace of 300,000, the government said Wednesday. That was the slowest sales pace on records dating back to 1963. And it’s the largest monthly drop on record. Sales have now sunk 78 percent from their peak in July 2005.
Analysts were startled by the depth of the sales drop.
“We all knew there would be a housing hangover from the expiration of the tax credit,” wrote Mike Larson, real estate and interest rate analyst at Weiss Research. “But this decline takes your breath away.”
It’s almost as if the Federal government was subsidizing market behavior and created an artificial floor in the housing market.
Nah. That couldn’t be.
The blogosphere is buzzing about the Rolling Stone article on General McChrystal, which highlights the commander’s (ahem) lack of enthusiasm for his civilian superior.
That’s putting it mildly.
The article highlights the general’s disdain for the Vice-President, Ambassador Holbrooke, even the President for the way in which they are waging the Afghanistan war.
That this information has now been made public is a big problem for our efforts in Afghanistan and for the general himself, the solution to which should be outright dismissal. He can have his opinions, but save the public pronouncements for retirement.
Most likely this is what will happen, but what about the President?
We’re dealing with a narcissistic and fragile Commander-In-Chief, and any talk that makes the administration seem incompetent or not up to the task at hand, doesn’t sit very well with this White House. Where to lay the blame for this mess?
Look in the mirror, Mr. President:
The real trouble is that Obama never resolved the dispute within his administration over Afghanistan strategy. With the backing of Gates and the Pentagon’s top generals, McChrystal sought to apply to Afghanistan the counterinsurgency approach that succeeded over the last three years in Iraq, an option requiring the deployment of tens of thousands more troops. Biden opposed sending most of the reinforcements and argued for a “counterterrorism plus” strategy centered on preventing al-Qaeda from establishing another refuge.
In the end, Obama adopted what is beginning to look like a bad compromise. He approved most of the additional troops that McChrystal sought, but attached the July, 2011 deadline for beginning withdrawals. Since then both sides have been arguing their cases, in private and in public, to the press and to members of Congress.
Expect a lot of demonizing in the next 24-48 hours.
If this is true, then there’s good news coming out of North Korea:
Bowing to reality, the North Korean government has lifted all restrictions on private markets — a last-resort option for a leadership desperate to prevent its people from starving.
In recent weeks, according to North Korea observers and defector groups with sources in the country, Kim Jong Il’s government admitted its inability to solve the current food shortage and encouraged its people to rely on private markets for the purchase of goods. Though the policy reversal will not alter daily patterns — North Koreans have depended on such markets for more than 15 years — the latest order from Pyongyang abandons a key pillar of a central, planned economy.
With November’s currency revaluation, Kim wiped out his citizens’ personal savings and struck a blow against the private food distribution system sustaining his country. The latest policy switch, though, stands as an acknowledgment that the currency move was a failure and that only capitalist-style trading can prevent widespread famine.
Over the past year or so, as debates here in the States raged about whether government control over aspects of the economy were favorable or not, I’ve heard people say things to the effect of “maybe [aspects of] socialism aren’t so bad” and “what’s wrong with the government guaranteeing this social benefit or that subsidy”.
Actually, everything’s wrong with command economies, where the motive for economic gain and self-sufficiency are out of the equation. North Korea may have realized this too late. Better late than never, I guess.
There’s really not much to say about this lame stab at leadership by President Obama. To me this was a waste of an Oval Office speech, only because the blatant politicization of the oil spill is reaching absurd proportions.
For Obama, everything is political, including this oil spill.
The commentariat have spoken. The most spot-on assesment I’ve seen so far however, comes from Stacy McCain:
The Gulf oil spill is not a political problem. You can’t negotiate a compromise with a broken well. Nor is the oil spill a legal problem. You can sue BP, but litigation isn’t going to cap that well. And all the “community organizing” in the world isn’t going to fix the problem, unless you’re planning to plug the well with SEIU members.
What is Obama’s greatest skill? Reading speeches. As I remarked in February 2009, Obama could read the ingredients from the side panel of a box of pancake batter (“…dextrose, partially hydrogenated soybean oil with mono- and diglycerides…“) and inspire standing ovations from an audience of adoring Democrats. But all Obama’s oratorical powers are useless to the task of plugging that well.
As I’ve noted before, the spill was not the President’s fault, no more than Katrina was Bush’s fault. And as for the President’s “response” in both of these situations? What can they do really?
At this point, anyone who doesn’t think that Obama is desperately trying to regain any shred of credibility in the wake of falling poll numbers, by grandstanding about this disaster is seriously fooling themselves. The rushed trips to the Gulf, the “kick ass” statement, etc., all culminating in this pathetic speech, everything smacked of desperation.
The need to “do something” to appear presidential just resulted in more flailing, more idiocy.
Which leads to the ultimate problem for left-wingers–their incessant belief in the power of large bureaucracies like the Federal government to be able to “solve” these problems. Couple that with an incompetent community-organizer as President and you have one heckuva problem on your hands.
No wonder why people are starting to realize that Obama kinda sucks at handling crises:
[Public Policy Polling's] new Louisiana poll has a lot of data points to show how unhappy voters in the state are with Barack Obama’s handling of the oil spill but one perhaps sums it up better than anything else- a majority of voters there think George W. Bush did a better job with Katrina than Obama’s done dealing with the spill.
50% of voters in the state, even including 31% of Democrats, give Bush higher marks on that question compared to 35% who pick Obama.
Overall only 32% of Louisianans approve of how Obama has handled the spill to 62% who disapprove. 34% of those polled say they approved of how Bush dealt with Katrina to 58% who disapproved.
That the MSM is going nuts about this speaks volumes. At this point, anything the President says or does just digs him deeper in the hole.