Bear Wisdom

Despite all of the attempts by the government to rescue the real estate market, it is continuing to fall apart, as rising unemployment is leading the way to more mortgage defaults.
Approximately 12% of first-lien home mortgages in the US were overdue or in the process of foreclosure at the end of March. That’s a jump [...]

More than 90% of economists believe that the US recession will end this year, however they believe that the recovery will be bumpy.
74% of forecasters believe that the recession will end in the third quarter of this year, 19% think it will end in the 4th quarter, and the remaining 7% believe it will end [...]

US Consumer confidence jumped to 54.9 in May, compared to 40.8 in April.  The index is at its highest since September of 2008.  And the market responded by rocketing higher, the Dow Jones by 2.37% (196 points.)  But there are further signs that the economy is continuing to deteriorate…
Home prices dropped 19% in the 1st [...]

The Pension Benefit Guaranty Corporation has a $33.5 Billion dollar deficit.  In October of last year, it had a $11 Billion dollar deficit, but in the past 7 months it has tripled.  The increased deficit is due to the loss of investments, lower interest rates, and the rise in companies filing for bankruptcy.
The PBGC guarantees [...]

Standard and Poor downgraded UK to negative from standard, and is at risk of losing it’s AAA rating.  UK’s general debt is getting close to reaching 100% of it’s GDP.  “A government debt burden of that level, if sustained, would in Standard & Poor’s view be incompatible with a ‘AAA’ rating,” the statement said.
Portugal, Spain, [...]

For anyone who thought bailouts where going to end anytime soon…

In January the Fed had forecasted a contraction of between .5% and 1.3%, with the unemployment rate rising to 8.5% – 8.8%.
4 ½ months later, now that we have surpassed 8.8% unemployment forecast (currently at 8.9%,) the Fed is now saying that the unemployment rate would rise to between 9.2% and 9.6%, and that the [...]

Californians went to the polls yesterday and overwhelmingly said no to propositions 1A through 1E.  These propositions were basically extensions on tax increases, and would also allow the state to borrow from other funds, such as future lottery revenues to pay for current deficits.  Californians voted 2 to 1 against the propositions.  Conservatives, Liberals, Independents, [...]

December 2008:
Back in December of last year, at the time, President-elect Obama stated that “deficits don’t matter” he said “we can’t worry, short-term, about the deficit.”  And added “stimulus plan is large enough to get the economy moving.”
And now after his administration has spent Trillions of dollars bailout out banks, insurance companies, auto makers, [...]

California Treasurer Bill Lockyer formally asked Geithner for TARP funds for California and other financially strapped local governments and states that face cash flow problems.
“If we cannot obtain our usual short-term cash-flow borrowings, there could be devastating impacts on the ability of the State or other governments to provide essential services to their citizens,” Lockyer [...]