Der Doomsday Bären-Thread
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Der vorläufige Verbraucherstimmungsindex der Uni Michigan notiert bei 78,7. Erwartet wurde der Index bei 82,5 bis 84,0 nach zuvor 84,7.
Die Zahlen deuten im Detail (siehe Artikel unten) auf wachsende US-Inflation bei nachlassender Wirtschaft hin (Stagflation). Das ist Gift für Aktien. Die jüngste Rallye sollte sich daher demnächst totlaufen. Sie basiert auf der dieser Woche durch die PPI- und CPI-Zahlen (fälschlich) geweckte Hoffnung, die US-Inflation bleibe niedrig. Nach den heutigen Michigan-Zahlen liegt diese jedoch bei 4,2 %.
Adam Oliensis
TheStreet.com
Slowing Growth and Rising Inflation Expectations
8/18/2006 3:20 PM EDT
Inflation expectations in the U of M Consumer Sentiment Survey have moved up to +4.2% for the coming year, up from +3.2% a month ago. In the same report consumer sentiment hit its lowest level since last October.
The consumer is anticipating both slower growth and rising inflation, or STAGflation, even as the Fed is talking about how slowing growth will tame inflation. Our macro work has shown that there is almost no historical correlation between economic growth and inflation. And our view continues to be that to expect slower growth to produce lower inflation any time soon is nothing better than wishful thinking.
The premises on which this past week's rally has been founded (mainly relief over "unhorrible" inflation numbers) are very likely to be called into question in the weeks ahead.
US-Notenbank
Wahl zwischen Pest und Cholera
Steigende Zinsen bahnen Weg in die Rezession - Sinkende Zinsen treiben Inflation.
Von Erwin Grandinger
Die amerikanische Notenbank Fed hat Angst vor einer harten Landung der US-Volkswirtschaft. Die Immobilienpreise sind teilweise im freien Fall, und die Wirtschaft wächst nur noch moderat. Und das mindert die Konsumlust. Amerikanische Verbraucher mit exzessivem Ausgaben- und Verschuldungsverhalten waren aber die Stütze der Weltwirtschaft in den vergangenen Jahren. Fed-Chef Ben Bernanke und seine Kollegen haben nun erstmalig seit April 2004 von einer Erhöhung der Zinssätze abgesehen. Dieser Schritt scheint logisch und markiert eine Wende in der Zinspolitik.
Doch Bernanke hat die Wahl zwischen Pest und Cholera, denn der Preisdruck in den USA ist unübersehbar. Um den steigenden Inflationsdruck einzudämmen, müsste die Fed eigentlich die Zinsen weiter anheben. Zur Rettung des Wirtschaftswachstums legt die Fed nun aber erstmal eine Zinspause ein. Natürlich versuchen Volkswirte mit künstlich gerechneten "Kerninflationsraten" das Problem zu verniedlichen, indem man volatile Werte wie Energie- und Lebensmittelpreise herausrechnet. Im Laufe der Jahre wurde das Konzept verfeinert und sogar banale Dinge des täglichen Lebens wie Gebrauchtwagen, Spielwaren und anderes mehr aus der Preisberechnung genommen. Dieser Trick wurde 1974/75 vom ehemaligen Fed-Chef Arthur Burns entwickelt, um einen Grund zu finden, den Fed-Zinssatz niedrig halten zu können, obwohl die Verbraucherpreise stetig stiegen. Damit führte man natürlich die Öffentlichkeit in die Irre. Die Fed hinkte dem Preisdruck hinterher, und die Inflationsraten explodierten förmlich in den späten Siebzigerjahren, wie auch die Rohstoff- und Energiepreise.
Aber jeder, der in den USA lebt, weiß, dass sich die Haushaltsrechnungen in den letzten Jahren rapide verteuerten. Würde die Fed die Zinsen weiter anheben, ergäbe sich eine invertierte Zinsstrukturkurve (die kurzfristigen Anleiherenditen sind höher als die langjähriger Rentenpapiere). Ein Szenario, das über einen längeren Zeitraum normalerweise eine nahende Rezession signalisiert. Also bemüht man seit einigen Jahren wieder einen alten Begriff - die Kerninflationsrate. Bankenvolkswirte spielen damit der US-Notenbank, aber auch der Europäischen Zentralbank (EZB) in die Hände, denn auch in der Euro-Zone ist der Preisdruck deutlich spürbar. Der momentane Zinserhöhungszyklus dürfte bei der EZB zur Jahreswende ein Ende finden.
Fallende Notenbankzinsen und eine langsam steigende Inflation (in Maßen, sodass Verbraucher nicht in Panik geraten) bringen den USA natürlich einen strategischen Vorteil. Die geringere Zinsdifferenz etwa im Vergleich mit der Euro-Zone bewirkt einen sich in geregelten Bahnen abwertenden Dollar (aber einen starken Euro zum Nachteil der europäischen Exportindustrie). Dies trägt auch dazu bei, das extrem hohe US-Leistungsbilanzdefizit zu reduzieren. Und höhere Verbraucherpreise führen dazu, dass die enormen Schuldenstände von Staat, Unternehmen und Privatverbrauchern abgebaut werden. Diese Fed-Strategie kann natürlich nur so lange funktionieren, wie der Preisdruck nicht außer Kontrolle gerät. Denn in den Siebzigerjahren konnte Fed-Chef Paul Volcker nur mit massiven Zinsanhebungen die steigende Preisspirale brechen. Heute wäre dies nicht mehr möglich, denn die USA sind vom damals weltgrößten Gläubiger zum Schuldner mutiert.
Heute wie Mitte der Siebzigerjahre sind steigende Energie- und Rohstoffpreise eine Ursache für den Preisdruck. Während allerdings vor 30 Jahren eine künstliche Angebotsverknappung (Ölkrise) der Auslöser war, ist es heute ein massiver Nachfrageschock (China) gekoppelt mit einem tatsächlichen Angebotsstau (Lieferengpässe bei der Rohstoff- und Energieproduktion). Der Anleger sollte sich also überlegen, ob er sich wegen der riskanten Zentralbankstrategien und noch über viele Jahre steigenden Verbraucherpreisen mit Rohstoff- und Energiefonds absichert.
Der Autor ist Politischer Analyst und Partner bei EPM Group in Berlin
Artikel erschienen am Sa, 19. August 2006
© WELT.de 1995 - 2006
PETER BRIMELOW
No room to zoom?
Commentary: Stocks may face a dreary decade ahead
By Peter Brimelow & Edwin S. RubensteinLast Update: 10:16 AM ET Aug 21, 2006
NEW YORK (MarketWatch) -- Every year or so, we chart the progress of the stock market in terms of its long-run "total return" trend. That's adding in capital gains and dividends, and adjusting for inflation. Our charts are based on the work of Professor Jeremy Siegel of the University of Pennsylvania's Wharton School, author of the classic book, "Stocks For the Long-Run." See Siegel's Web site jeremysiegel.com for more information. (He doesn't always agree with our conclusions!) Siegel's most famous finding: stocks have accumulated on average in real terms at a remarkably consistent 7% or so over the last two hundred years. Shown on a log scale this consistent trend appears as a straight line.
Of course, you have to squint at the long-run chart to see movements that, when actually experienced, seem very dramatic. For that reason, we focus on stocks' movements around their long-term trend in just the last 10 years. Note: The long term trendline slopes upward on this chart, because is drawn on an arithmetic rather than a log scale. When we first looked at Siegel's numbers in the late 1990s, stocks were over 80% above the long-run total return trendline, about as high as they ever get. Stocks reached similar levels in 1928 and 1968 -- both years when the stock market was notoriously topping out. Stocks did fall after 2000 (remember?) But they never got lower than a few points below trend. Then the post-election Bush bounce in 2004-2005 took stocks to some 7% above trend.
After that, stocks stalled. That means that this time last year, because of that relentlessly accumulating trendline, stocks were down to less than 1% above it. See Aug. 26, 2005 column.
Now it's even tighter: Stocks are just 0.1% below trend, to be exact. And even that's still well above the levels usually seen at major bear market lows. In both 1931 and 1973, stocks got some 40% below trend. In other words, an epochal but not unprecedented bull market high has not yet, unlike in every other case on record, been succeeded by a corresponding bear market low.
This may sound worrying. But of course the major market indexes we're used to watching don't literally have to fall 40%. Because the underlying total return trend rises at some 7% a year, the indexes can just move sideways. How long? Well, adjusting just for dividends, if the Dow Jones Industrial Average (INDU) moved sideways until 2019, that would be the equivalent of Siegel's broad, total-return measure of stocks getting 40% below trend. That's a 19-year stagnation in total, quite comparable to the Dow 16-year stagnation after 1966. On the bright side, if you assume inflation will be equal to the Dow's dividend yield, the stagnation will end in 2014. Whoopee! Obviously, Seigel's numbers reflect a very general truth. There's plenty of room for dramatic deviation within the long-term framework. Witness the Bush bounce. But, overall, it's hard to see much upside energy in stocks right now. Of course, that's about what we said when we first discussed Siegel's numbers. See April 16, 2003 column. OK - the market's higher now. But it has still not exceeded 2000's peak. And its room to zoom is now much less.
Edwin S. Rubenstein is president of ESR Research in Indianapolis. (esrresearch.com) 
How the Shorts Fueled the Tech Rally
By Jim Cramer
TheStreet.com
8/21/2006 10:56 AM EDT
Why did tech rally so viciously last week? Sure, it is possible to say that Cisco (CSCO - commentary - Cramer's Take) caused a rally. But the rally should have ended by the beginning of the week. Cisco doesn't have that kind of legs. The pin action can go only so far.
I think there was something behind the scenes that I have put together that makes more sense.
First, there were swirls for the last week from a multi-billion-dollar tech fund that went bust and had to liquidate. While these things are always secret, trading desks confirmed to me that supply was coming from one source.
The supply consisted mostly of the highest-multiple Nasdaq-100 stocks: Rackable (RACK - commentary - Cramer's Take), Citrix (CTXS - commentary - Cramer's Take), Network Appliance (Nasdaq - commentary - Cramer's Take), Qualcomm (QCOM - commentary - Cramer's Take) and the like.
In my old hedge-fund days I used to lean endlessly against a fund that might be liquidating. It was as close to free money on the short side as you could find. But typically you had to be sure that when the supply was exhausted you had to cover, because there is nothing proprietary about the short call. Everyone tied in has the same call.
I think last week's rally revolved around the hedge fund being liquidated and the shorts needing to cover.
Once the covering occurred, that was history. And the rally got started in earnest.
That's the reason for much of the rally.
At the time of publication, Cramer was long Citrix and Qualcomm.
Wall Street Plays Oldies
By Doug Kass
Street Insight Contributor
8/21/2006 2:44 PM EDT
A cooling economy -- along with lower interest rates and energy prices -- has served to buoy markets in a "Summer Love In" for stocks.
Arguably, the advance has now ushered in a sense of conformity. Of course, the ever-present risk of a contrarian (read: bear!) is that the past literally does repeat itself and that the crowd outsmarts the remnant. And while historical relationships almost always hold true as a prologue to tomorrow, it does not say which lesson to apply and when.
Rising geopolitical risks (and Middle East instability) coupled with the likely broad ramifications of a hard landing in housing have all but been ignored. The rise off the recent lows has been impressive, emboldening previously worried investors who have increasingly begun to worship at the "Altar of Momentum."
I have spent a lot of time on The Edge discussing the negative impact that a sharp decline in homebuilding activity and cash-out refinancings will have on the economy in general, and the consumer in particular. The following chart indicates -- with a reasonably high probability (an R squared of 0.64) -- that when the index of homebuilders drops, a broader decline in the major indices is not far behind.
With fear and doubt all but driven from Wall Street, a marked correction in stocks can happen at any time. The market's behavior during this summer is starting to look technically similar to the advance of August-October 1973 -- which also started off an unimpressive bottom -- that fizzled rather quickly as equities entered a bear market in 1974.
Conformity often pays off in markets -- as New York Times Op Ed editor David Brooks points out regarding cultural issues of the 1950s in his references to Grace Metalious' Peyton Place. That novel produced a message -- to engage in high-risk searches for unpleasant truths -- that speaks not only about the repressive bourgeois a half-century ago but also volumes to investors during the summer of 2006.
From my perch, that search could produce a panoply of negative outcomes (sharply lower corporate profit margins, an adjustment downward of consumer expenditures and stubbornly high inflation). And it might produce, to paraphrase another lyric from "Grease": "Summer dreams are (about to be) ripped at the seams ... but oh, those summer nights!"
As Brooks recounts in Sunday's Times (though on a far different subject), the market's line between bulls and bears is now clearly drawn. And perhaps he is correct in the notion "that there's actually more conformity and complacency (today) than even in the 1950s," though not at Peyton Place, but at the corner of Broad and Wall.
082106kass-chart.gif
das glaub ich nicht, wenn ich mir das vorher anschaue, da hats den S&P auch nicht interessiert, wenn der Housing-Market-Index abgebrochen ist....
m.M. Gruß pichel
Immerhin liefen beide Indizes seit 1995 fast lupenrein parallel. Außerdem gibt es ja auch eine fundamentale Beziehung: Wenn keine neuen Hypothekenzinsen mehr aufgenommen werden können, weil der Beleihungswert der Immobilien gesunken ist, senkt das die Konsumenten-Kaufkraft (US-Sparquote ist ja negativ), die zu zwei Dritteln für die US-Wirtschaftsleistung verantwortlich ist.
ZEW-Index fällt auf tiefsten Stand seit fünf Jahren
Die Börsianer sind so pessimistisch wie seit 2001 nicht mehr. Der ZEW-Konjunkturindex für Deutschland, der die Erwartungen von Analysten und Anleger misst, sank weit drastischer als erwartet.
Die Finanzmärkte beurteilen die Aussichten der deutschen Wirtschaft deutlich skeptischer als im Juli. Der Saldo der Konjunkturerwartungen der rund 300 befragten Analysten und institutionellen Anleger sank im August von 15,1 auf minus 5,6 Punkte. Dies teilte das Mannheimer Zentrum für Europäische Wirtschaftsforschung (ZEW) am Dienstag mit. Der Index fiel den siebten Monat in Folge und erreichte den niedrigsten Stand seit Juni 2001.
"Die Entwicklung des Indikators signalisiert eine deutliche Abkühlung der konjunkturellen Entwicklung auf Sicht von sechs Monaten", erklärte das ZEW. Von der Nachrichtenagentur Reuters befragte Analysten hatten mit einem weit moderateren Rückgang des Indikators auf 12,0 Punkte gerechnet.
Die aktuelle Lage beurteilten die Experten allerdings erneut besser als im Vormonat: Der Indikator stieg von 23,3 auf 33,6 Zähler. Die Erwartungen für die Euro-Zone fielen von 18,1 auf 1,3 Punkte.
Die derzeit sprudelnden Steuerquellen werden auch nicht nachhaltig sein, auch wenn Lieschen aus der Ukermarck damit kein Problem hätte, wenn es anders wäre, und weiterhin an der Mehrwersteuererhöhung festhält.
Showdown at Jackson Hole over Fed outlook
One camp sees interest rates going up to 6%, others back to 5%
By Greg Robb, MarketWatch
Last Update: 11:00 PM ET Aug 21, 2006
WASHINGTON (MarketWatch) - Two camps of economists with decidedly different views head to Jackson Hole, Wyoming later this week and the townsfolk are bracing for trouble.
One camp - the bigger one - asserts that the Federal Reserve Board is finished hiking interest rates after a two-year campaign and it will be only a few months before the U.S. central banks begins cutting them to spur economic growth. The other argues that the central bank will have to raise rates a few more times, at least, to tame inflationary pressures.
"We now suddenly find ourselves stuck between two camps fighting for airtime - those who are looking for rates to head up towards 6% and those who think they should be going back towards 5%," said Andrew McLaughlin, chief economist at The Royal Bank of Scotland Group, who claims rates will peak at 5.5% from their current 5.25%.
The battle will take place in the hallways and hiking trails near the Federal Reserve's annual policy retreat in the shadow of the Grand Teton Mountains.
The topic of this year's Jackson Hole symposium is globalization, and indeed, with the collapse of the Doha Round of world trade talks and growing protectionist talk in many countries, there are some critical issues to discuss. Fed chief Ben Bernanke will address global economic integration in formal remarks on Friday morning.
But these issues will take a back seat to the debate about the road ahead for the Fed, economists said. There was even some disagreement on the FOMC, with a rare dissent at its last meeting on Aug. 8 when the committee decided to hold rates steady at 5.25% after 17 straight rate hikes.
The Fed is trying to reach the fabled soft landing, with growth slowing enough to take the air out of inflation balloon, but not too slow to cause a recession.
But there are dissenters at both ends of the Fed's forecast. The data since the Fed meeting has emboldened the camp that believes the Fed is done. "I believe the tightening is over. It should be over," said Kevin Logan, economist at Dresdner Kleinwort Wasserstein Securities. "I think the economy is going to slow for a number of reasons, including tighter policy but in addition the energy price increases that have sapped the growth of real income."
On the other side, Rich Yamarone, chief economist at Argus Research, said the Fed has more work to do. The economy should pickup after the typical summer doldrums "and the Fed will say maybe we aren't as weak as we thought and the problem is that inflation is not going away," Yamarone said.
In a sense, it boils down to a debate about forecasts for economic growth in the next few quarters. The slowdown camp expects the housing markets to slow growth severely. Peter Hooper, chief U.S. economist at Deutsche Bank, said economists expecting higher rates "are giving less weight to softness in the housing market and the potential for that feeding through into softer consumer spending growth."
Others think the concern about housing is overdone. "One of the things I found interesting and slightly puzzling is the way in which people have started to look at the U.S. economy through the lens of its housing market. I think it is a mistake. The idea that the housing market will bring the whole economy down is far-fetched," said McLaughlin. McLaughlin said the Fed would have to hike rates one more time to 5.5%, with risks to the upside. "I think there are inflation pressures there. That's why I think the Fed has still got to go at least one more time to make sure it deals with them effectively," McLaughlin said.
Greg Robb is a senior reporter for MarketWatch in Washington.
Heute sagte es soeben der Chicagoer-Fed-Präsident Michael Moscow (nachdem keiner mehr damit gerechnet hatte), und die Märkte gehen ebenfalls in die Knie.
More rate hikes may be needed to curb inflation: Moskow
By Greg Robb
Last Update: 1:00 PM ET Aug 22, 2006
WASHINGTON (MarketWatch) - Financial markets should not assume that the Federal Reserve is done tightening, just because it paused at its last meeting after 17 straight rate hikes, said Michael Moskow, the president of the Chicago Federal Reserve Bank on Tuesday. Moskow has persistently delivered an anti-inflation warning to financial markets this year, and his remarks today were no exception. He said his assessment of current economic conditions is "that the risk of inflation remaining too high is greater than the risk of growth being too low. Thus some additional firming of policy may yet be necessary to bring inflation back into the comfort zone within a reasonable period of time."
By Tony Crescenzi
Street.com
8/22/2006 1:33 PM EDT
Chicago Fed President Michael Moskow struck a hawkish theme in a speech he just delivered in Illinois. Moskow is not a voting member of the Federal Open Market Committee and has a history of hawkish leanings, but he attends the FOMC meetings and his comments are likely consistent with those of other members of the FOMC.
Moskow's hawkish comments were straightforward:
"The risk of inflation remaining too high is greater than the risk of growth being too low. Thus, some additional firming of policy may yet be necessary to bring inflation back into the comfort zone within a reasonable period of time.''
[Kommentar: "some additional firming of policy may yet be necessary" ist exakt die Formulierung, die die Fed am 10. Mai verwandt hatte. Bei der folgenden Sitzung im Juni wurde dies "weicher gespült". Moscow verschärft den Ton jetzt also wieder - A.L.]
Moskow has been president of the Chicago Fed for 12 years and surely he has learned the importance of choosing his words carefully, so his comments today carry additional weight.
Moskow's theme is likely to be repeated by other Fed officials in upcoming days and weeks [das hatten wir im Mai ja schon mal! - A.L.], including this weekend in Jackson Hole, Wyoming, [siehe P. 340 - A.L.] where the Fed will gather for its annual symposium. The Fed's strategy is likely to further reinforce the progress that has been made with respect to lowering inflation pressures, especially since the progress made has been small and in place only for a short time. Another strategy will likely be to squash any idea of an interest rate cut, if only to avoid any cannibalization of past rate hikes in order to give the hikes more time to work.
Technical Analysis
Still Not Time to Move Home
By Dan Fitzpatrick
Street.com Contributor
8/22/2006 11:21 AM EDT
This week, the market seems fixated on the housing numbers. Today we heard from Toll Brothers (TOL) . Tomorrow morning we get the July existing-home sales numbers. Yawn. Thursday brings the new-home sales numbers. Key point -- they're not going to be good. Everybody knows that. The question is whether they are going to be as bad as everyone expects.
When it comes to the homebuilding stocks, there are three camps -- and two of them are inhabited by bears. First is the aggressive ursine bunch [= aggressive Bären] who believe that these stocks are only resting on a cliff before moving much lower. Second are the more wary bears, who still don't like the sector but feel that it's a crowded short. Finally, there are the apologetic, tentative bulls anticipating a sustainable bottom. These are the folks who believe that all the bad news has already been factored into the sector.
I'm still comfortably ensconced in the first camp. I am hearing about a lot of cancellations. High cancellation rates can effectively nullify any new sales. Builders are now taking a cue from their prospective buyers and walking away from land deals. This is not breaking news -- but it's so rampant and widespread that I don't know how it's possible to accurately discount this into the stock price.
For example, when Standard Pacific (SPF) , a California-based homebuilder, posted results last month, it disclosed that it had written off $16.3 million in deposits and due diligence (preacquisition) costs for abandoned or uncertain projects.
Similarly, Hovnanian (HOV) recently disclosed that it will be walking away from substantial land-option deposits. The company couldn't even quantify the cost in its forecasts.
We are seeing similar expenses incurred by D.R. Horton (DHI) ($52 million), NVR (NVR) ($26 million), Pulte Homes (PHM) ($62 million), Centex (CTX) ($36 million) and Lennar (LEN) ($22 million).
Now, it would be a mistake to believe that expenses of this kind will continue. They won't, but they'll persist longer than you might imagine. How could that be? With only so many deals in the pipeline, how many more deposits are left to forfeit? Well, lots of these deals are land-development deals and may not be scheduled to close until 2007. Also, homebuilders make money when they sell finished product, so the continual slowing of construction starts equates to decreasing revenue and profit going forward.
In addition, I have a thesis, based on anecdotal evidence, that divisions are not being straight with the corporate offices. In a slowdown of this magnitude, executives become fearful of losing their jobs if they disclose the "real deal." Employment insecurity reigns supreme in this environment and fosters selective disclosure. Sales agents are being instructed to conceal cancellations until they have resold the unit. That's wrong.
Refundable deposits on units that have not yet received a "final report" are being reported as bona fide sales. That's dumb. Acquisition-related marketing reports are being fudged in order to make deals look better, with the hope that the economy will pick up in time. That's suicide.
So let's take a look at a few of the bigger names. Remember, strong stocks can become overbought and remain that way far longer than most folks realize. Conversely, and more to the point, weak stocks can become oversold and remain that way for quite a while, too.
The Philadelphia Housing Index has been treading water since last month, with no real sign of a turnaround. Notice how oversold the relative strength index (RSI) had become, falling well below 30. That doesn't happen often, and is a sign of extreme weakness. But unless the HGX moves back above 210 or so, I'd look at the current weakness as an opportunity to unload some shares. Let's take a look at a few stocks now.
Beazer Homes (BZH) took a 50% haircut from the January high, but it doesn't appear as if it was enough. A series of lower highs and higher lows after a sustained downtrend is typically a continuation pattern -- not consolidation. I'd look for more downside if the stock falls below the support line I've drawn above. I would not be surprised to see the stock test $30 before this is through. (Let the hate mail fly).
D.R. Horton is showing the same type of pattern we saw in Beazer. Notice how long the price-by-volume bar is at the $22 level? A lot of stock has been changing hands here. I'd look for additional supply to push the stock lower. If the price drops below $20, it's probably not a good idea to stick around.
MDC Holdings (MDC) has been trying to find a bottom around $42. RSI is showing extreme weakness. It's not even faking a bounce. I'd be a seller on any move below $42, and if you're looking for a better reference point than this weekly chart, then zoom out to a monthly chart.
This is for those who keep saying, "The homebuilders just can't go down any more." Enough said.
Want to see a strong homebuilding stock? Go south of the border to Mexico. Desarrolladora Homex (HXM) is the strongest of the bunch, but seems stalled at $40. I wouldn't be a buyer until this stock breaks through resistance.
That's my current take on the homebuilding group. If you want to know when these stocks are likely to turn around, I'll let you in on the best "tell" for this industry: It's you! When you start seriously thinking about buying a new house -- or hear your friends talking about it -- then you've got a pretty good idea that you're getting in on the ground floor of a meaningful advance. I just don't see that happening for many, many moons.
Be careful out there.
34237.bmp
Viele Newsletter in USA sind bereits bärisch. Ist das ein Kontaindikator? Die Argumente stimmen soweit...
PAUL B. FARRELL
Tipping point pops bubble, triggers bear
Ten warnings the economy, markets have pushed into danger zone
By Paul B. Farrell, MarketWatchLast Update: 8:18 PM ET Aug 21, 2006
ARROYO GRANDE, Calif. (MarketWatch) -- You heard the pop! Forget the happy talk. We just crossed that crucial tipping point, popping the bubble, signaling a bear. Why? The Fed halted interest rate increases.
That's bad news, says economist Gary Shilling. Check the historical data: "With only one clear exception in the mid-1990s, central bank ease since the mid-1950s means the economy is in a recession, or will be within a few months." My filing cabinets are bulging with all kinds of early-warning signals screaming that we've passed the tipping point. A few are deafening: One by the CEO of Countrywide Mortgage. Another by the CEO of Toll Bros. Then hedge fund losses drove us to pull together a total of 10 warnings that signal the popping of the bubble and the start of a recession and a bear market.
1. Mortgage lender: 'Never seen a soft landing'
When a CEO like Countrywide's Angelo Mozilo speaks, his message is far more important than all the happy talk coming out of Washington and Wall Street: "I've never seen a soft-landing in 53 years, so we have a ways to go before this levels out. I have to prepare the company for the worst that can happen." Investors better prepare too.
2. Housing warns of sustained downturn
Robert Toll, CEO of luxury home builder Toll Brothers reports dramatically declining sales and revenue. Toll says the slowdown "will last for at least six months more, it may last for two years more. We don't know." Reminds us of the 2000-2002 recession.
3. Hedge fund losers the past two months
Hedge funds have been in the news a lot since topping the $1 trillion mark in assets. This unregulated industry is a loose cannon. They've become the new dot-coms now that most retail markets are so volatile and flat, forcing portfolio managers and investors to look for alternatives to the $9 trillion mutual fund market. As a result, hedge funds are chasing anything that hints of higher returns. For example, the main data tracker, the Hennessey Group, just announced that hedge funds have underperformed the S&P 500 for the second straight month. Other warnings have all been reported in the news lately, screaming risk, risk, risk! Flashing like neon signs on the Vegas Strip:
- Congress is giving hedge funds more access to pension fund money.
- In spite of underfunding due to past errors, corporate and state pension funds are now betting more on riskier hedge-fund deals to increase returns.
- The success of Yale and Harvard has inspired small-college endowment funds to start betting on similar risky hedging games.
- The lure of huge, fast profits for hedge-fund managers has young inexperienced college grads jumping into the business and getting backers.
- Retail mutual funds are asking shareholders for permission to engage in more aggressive hedging strategies, like short-selling and derivative trading.
- Like hedge funds, private-equity funds are now signaling a top; too much new capital is forcing them to chases fewer, riskier deals.
- After a record year, IPOs, a hedge fund competitor for new capital, are also topping as many deals are falling below issue prices.
And get this, hedge funds have been making big bets on Hollywood movies, using sophisticated programs to pick winners. This sounds like a sequel to the 1998 LTCM disaster; call it "Déjà vu Dot-coms!"
4. Rentals squeezing ARM borrowers
The cost of renting in Los Angeles is up 88% the past decade according to Realfacts. Santa Monica is up 279%. Potential buyers can't buy so they rent. And owners can't sell to recoup the high costs they paid in the recent bubble, so they're renting out. But they can't make enough to make their mortgage payments. USA Today estimates that nationwide median mortgage payments are $1,687 while rents are only $868. So now all the cheap money that sucked buyers into ARMs is putting the big squeeze on everybody, owners, renters and lenders, further driving inflation.
5. Inflation hits pickup truck sales
As new construction falls and gas prices skyrocket, pickup truck sales have been falling dramatically. So now, as Americans buy fuel-efficient Asian imports, the Big Three is paying a heavy price for relying too much on profits from gas-guzzlers. No wonder Toyota is now bigger than Ford, may soon pass GM.
6. Corrosive domestic oil policies
Free market? Or surreal? Since 2000 America's energy policies have been made in secret. Last year oil executives didn't have to testify in Congress under oath. This year as gasoline prices skyrocket, so do oil company profits and their executives compensation. So when we recently saw the Alaskan oil fields shut down because pipelines are physically corroded, the symbolism was obvious; America's energy policy is as corroded and corrupt as the oil companies poorly maintained pipes and their executives thinking.
7. Markets 'unfazed' by terror threats
The day after the recent bomb threat against 10 commercial aircraft traveling from Britain to the U.S., headlines read: "Markets unfazed!" Read that "oblivious." Yes, we all know that historically markets are resilient after major crises. But this lack of response reminds me of the happy talk during the 2000-2002 period when delusional bulls grabbed any excuse to deny America's long and painful freefall into a bear recession.
8. Main Street investor sentiment dropping
The gap between the top and bottom of America's economic classes is rapidly widening. Our "ownership society," a small group of investors that control over two-thirds of the stock market may be "unfazed." But the truth is, the incomes of America's middle class have been level, while inflation has been eating away at the incomes of minimum-wage workers. Most Americans aren't party to the drama played at the Wall Street casino, while insiders, corporate CEOs and Congress have all enjoyed substantial increases in personal income the past decade.
9. War costs accelerating
In spite of all the hype about controlling the insurgency, violence is increasing. Iraq can't stand up, so we can't stand down. We're trapped in a no-win, no-exit conflict, policing a civil war. And unfortunately America's domestic partisan politics is creating inflexible strategies that are draining huge resources: The Iraq and Afghan wars are now estimated to top $1.27 trillion amid mounting Middle East tensions and rising domestic terror threats, while a depleted military is unprepared for another major war.
10. Federal deficits grossly understated
Our government spending is totally out of control, no fiscal restraint, no legislative oversight and Enron-style accounting that disguises how bad things are. USA Today says federal deficits reported as $318 billion would actually be $760 billion if standard corporate accounting rules were used. And if we were honest and accounted for Social Security and Medicare costs, the deficit would be $3.5 trillion, 10 times what we're led to believe. Lay and Skilling were rank amateurs. Bottom line: All these signals tell us the tipping point was crossed, the bubble has popped and we are heading into another bear market and recession. Any comments?
ECONOMIC REPORT
Existing-home sales plunge to 2-year low
Inventories of unsold homes rise to 13-year high
By Rex Nutting, MarketWatch
Last Update: 10:01 AM ET Aug 23, 2006
WASHINGTON (MarketWatch) -- Sales of existing homes plunged 4.1% to a seasonally adjusted annualized rate of 6.33 million, the lowest since January 2004, the National Association of Realtors said Tuesday. Economists were expecting a decline to 6.56 million, according to a survey conducted by MarketWatch.
The report shows a continued weakening in the housing market, with inventories up sharply while prices are softening. Sales are down 11.2% in the past year. "Boom markets are cooling significantly," said David Lereah, chief economist for the realtors group. Sales fell in all four regions.
The housing market and the economy are "fragile," Lereah said. Some markets that never boomed are now weakening because of sluggish local economies, such as Michigan, Ohio and parts of the Northeast, he said. "It's important for the Fed to understand how fragile the housing market is, and how fragile the economy is," Lereah said. "The economy impacts housing, and housing impacts the economy."
The inventory of unsold homes rose 3.2% to a record 3.856 million, a 7.3- month supply at the July sales rate, the highest since April 1993. The past year has seen the sharpest increase in inventories on record, Lereah said.
The median sales price has risen 0.9% in the past year to $230,000. It matches June for the weakest price growth in 11 years. Prices fell on a year-over-year basis in the West and the Northeast.
"Prices need to come down to bring back buyers," Lereah said. Sales of condos rose 2.8% in July to 818,000. Sales of single-family homes fell 5% to 5.51 million.
Rex Nutting is Washington bureau chief of MarketWatch.
Recession will be nasty and deep, economist says
Housing is in a free fall and is pulling the economy down with it, Roubini says
By Rex Nutting, MarketWatch
Last Update: 4:59 PM ET Aug 23, 2006
WASHINGTON (MarketWatch) - The United States is headed for a recession that will be "much nastier, deeper and more protracted" than the 2001 recession, says Nouriel Roubini, president of Roubini Global Economics.
Writing on his blog on Wednesday, Roubini repeated his call that the U.S. would be in a recession in 2007, arguing that the collapse of housing will bring down the rest of the economy.
Roubini wrote after the National Association of Realtors reported Wednesday that sales of existing homes fell 4.1% in July, while inventories soared to a 13-year high and prices flattened out year-over-year.
"This is the biggest housing slump in the last four or five decades: every housing indictor is in free fall, including now housing prices," Roubini said. The decline in investment in the housing sector will exceed the drop in investment when the Nasdaq collapsed in 2000 and 2001, he said.
And the impact of the bursting of the bubble will affect every household in America, not just the few people who owned significant shares in technology companies during the dot-com boom, he said. Prices are falling even in the Midwest, which never experienced a bubble, "a scary signal" of how much pain the drop in household wealth could cause.
Roubini is a professor of economics at New York University and was a senior economist in the White House and the Treasury Department in the late 1990s. His firm focuses largely on global macroeconomics.
While many economists share Roubini's concerns about the imbalances in the global economy and in the U.S. housing sector, he stands nearly alone in predicting a recession next year.
[Stimmt nicht ganz, der Bondmarkt preist über die invertierte Zinsstrukturkurve ebenfalls eine Rezession in 2007 ein - eingepreist ist eine rezessionsbedingte Zinssenkung von jetzt 5,25 auf dann 4,87 % - A.L.]
Fed watcher Tim Duy called Roubini the "the current archetypical Eeyore," responding to a comment Dallas Fed President Richard Fisher made last week in referring to economic pessimists as "Eeyores" (after Winnie the Pooh's grumpy friend).
"By itself this slump is enough to trigger a U.S. recession: its effects on real residential investment, wealth and consumption, and employment will be more severe than the tech bust that triggered the 2001 recession," Roubini said.
Housing has accounted, directly and indirectly, for about 30% of employment growth during this expansion, including employment in retail and in manufacturing producing consumer goods, he said.
In the past year, consumers spent about $200 billion of the money they pulled out of their home equity, he estimated. Already, sales of consumer durables such as cars and furniture have weakened. "As the housing sector slumps, the job and income and wage losses in housing will percolate throughout the economy," Roubini said.
Consumers also face high energy prices, higher interest rates, stagnant wages, negative savings and high debt levels, he noted. "This is the tipping point for the U.S. consumer and the effects will be ugly," he said. "Expect the great recession of 2007 to be much nastier, deeper and more protracted than the 2001 recession."
He also sees many of the same warning signs in other economies, including some in Europe.
Rex Nutting is Washington bureau chief of MarketWatch.
Auf dem Wallstreet board meinen nicht wenige Teilnehmer Dax Kursziel 6000 Ende 2006. Lach.
Und erinnern können die Leute sich nur an einen weniger guten September Monat in 2001.
Vermutlich liegt das daran, daß sie 1987 noch in Pampers um den Weihnachtsbaum
gelaufen sind. Legt doch mal die Charts übereinander...
Erst wenn nur noch Bullen hier und anderswo von der ersten Million träumen rücken solche Blutbäder näher...
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