US - Economic Data & News 01 (May 08 - Jul 08)

[kennynah]

14 Jun 2008 06:11 GMT
Paulson says housing correction 'very likely' to spill into 2009

OSAKA, Japan (Thomson Financial) - US Treasury Secretary Henry Paulson predicted today that the US housing correction is likely to continue into 2009, and repeated that the housing market is still the biggest downside risk to the health of the US economy.

"We're making progress working through the correction, but I think it's very likely that this will spill over into next year," Paulson told reporters after the G-8 finance ministers meeting in Japan.

Overall, he said economic improvement in the US will not come in "straight lines," and said there could be more bumps in the road for the US.

However, he said the fact that US financial institutions are able to keep raising capital is a good sign for the US financial sector.

Paulson deflected a question about whether intervention in the currency markets is needed in order to settle commodity markets, in particular the oil market. Instead, he said he thinks commodity price increases reflect a desire to hedge against inflation, and said he does not believe oil prices are up because the dollar is down.

For example, he said the price of oil has gone up in every currency, and noted that as of early 2002, the price of oil has risen by 500 pct, much higher than the amount the dollar has dropped in that time.

He also rejected the idea that speculators are helping to drive the price of oil higher, and went further by saying focusing on this factor amounts to misdiagnosing the problem, and diverts attention away from the real problem, which is a lack of supply.

More generally on currency, Paulson reiterated his view that sound US economic fundamentals will ultimately be reflected in the dollar.

[winston]

Jim Sinclair (Mineset): Total notional value of derivatives surpasses one quadrillion

“The notional value of all outstanding derivatives now totals approximately $1.144 QUADRILLION.

“This appears to be Bank of International Settlement spin to announce the largest gain in derivatives outstanding since they started to report. As of the last report it appeared that both listed and OTC derivatives was under $600 trillion. Now listed credit derivatives alone stood at $548 Trillion. The OTC derivatives are shown as $596 trillion notional value, as of December 2007. One can only imagine what number they are at now.

“Well we hit a QUADRILLION. We have more than $1,000 trillion dollars in all derivatives outstanding. That is simply NUTS because notional value becomes real value when either counterparty to the OTC derivative goes bankrupt. $548 trillion plus $596 trillion means $1.144 quadrillion.

“This means that no OTC derivative house can be allowed to go broke. This means that whatever funds are required to rescue failing international investment banks, banks and financial entities will be provided.

“Keep this economic law in mind. Monetary inflation proceeds price inflation and is its primary cause in economic history from Rome to present.

“Nothing can stop the juggernaut of price inflation heading towards every nation like a runaway freight train down a mountain.”

Source: Jim Sinclair, Mineset, June 9, 2008.

[kennynah]

screwing up

16 Jun 2008 12:30 GMT

BULLET: US DATA: June Empire State survey -8.93, vs -3.23,...
US DATA: June Empire State survey -8.93, vs -3.23, still showing
weakness in the region. This number has de-coupled from Philly and the
national ISM and should be interpreted accordingly.

[HengHeng]

with the size of derivatives getting higher and higher .. it is just a matter of time before fiak money becomes worthless as trust for the counter party's ablity to pay becomes none.

Well time to keep a little gold when gold corrects down to from this bubble.

[kennynah]

16 Jun 2008 17:13 GMT

BULLET: US DATA: Jun NAHB-Wells Fargo Hsg Mkt Index 18 vs 19.

US DATA: Jun NAHB-Wells Fargo Hsg Mkt Index 18 vs 19 in May.

[kennynah]

16 Jun 2008 17:38 GMT
US June homebuilders index falls to 18 vs 20 expected

WASHINGTON (Thomson Financial) - US homebuilders' confidence fell back to a record low in June, surprising economists who believed homebuilder confidence would rise slightly this month.

The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) for June fell one point to 18, the same record low reached in December.

Economists polled by Thomson's IFR Markets were expecting the index to rise slightly to 20 in June. Any number below 50 indicates most builders see conditions as poor; the index has not been above 50 since April 2006.

[LenaHuat]

Jim Sinclair (Mineset): Total notional value of derivatives surpasses one quadrillion

“The notional value of all outstanding derivatives now totals approximately $1.144 QUADRILLION.

“This appears to be Bank of International Settlement spin to announce the largest gain in derivatives outstanding since they started to report. As of the last report it appeared that both listed and OTC derivatives was under $600 trillion. Now listed credit derivatives alone stood at $548 Trillion. The OTC derivatives are shown as $596 trillion notional value, as of December 2007. One can only imagine what number they are at now.

“Well we hit a QUADRILLION. We have more than $1,000 trillion dollars in all derivatives outstanding. That is simply NUTS because notional value becomes real value when either counterparty to the OTC derivative goes bankrupt. $548 trillion plus $596 trillion means $1.144 quadrillion.

“This means that no OTC derivative house can be allowed to go broke. This means that whatever funds are required to rescue failing international investment banks, banks and financial entities will be provided.

“Keep this economic law in mind. Monetary inflation proceeds price inflation and is its primary cause in economic history from Rome to present.

“Nothing can stop the juggernaut of price inflation heading towards every nation like a runaway freight train down a mountain.”

Source: Jim Sinclair, Mineset, June 9, 2008.

Quadrillion = 1,000 trillion = 10 (to the power of 15) = 1,000,000,000,000,000
System here cannot display the mind-boggling "to the power of"???

[kennynah]

surprisingly, no seeable negative impact to index futures...not yet at least...

17 Jun 2008 12:30 GMT
BULLET: US DATA: May PPI +1.4%, core +0.2% for +7.2% overall.

US DATA: May PPI +1.4%, core +0.2% for +7.2% overall YOY and +3.0% core
YOY, not favorable numbers. But PPI's import should be diminished as
CPI is already in hand at +0.6%/+0.2% and PPI numbers did not totally
flow through. PPI energy +4.9% and food +0.8%. Core was held down by
-0.9% lt. trucks and -1.0% cars; furniture, periodicals, and liquor also
edged lower after gaining in April. Cigarettes, aircraft, plastics and
communications eqpt turned higher. Intermediate PPI +2.9% and crude
+6.7%, showing that there is no relief in sight from higher prices.

[kennynah]

another set of bad data...again largely ignored by markets so far, DOW futures holding up 70+ points gains...

17 Jun 2008 12:30 GMT
BULLET: US DATA: May US housing starts -3.3% to a 975k SAAR,.

US DATA: May US housing starts -3.3% to a 975k SAAR, slightly below the
980k rate expected and following mixed revisions to the previous two
months. Single-family starts fell 1.0%. Building permits -1.3% to 969k,
while completions +11.6% to 1.132 mln following a 14.9% drop in the
previous month. The data confirms the continued weakness in new home
contruction that can be seen in a number of indicators.
--
Also, 1Q current account gap $176.4b vs revised $167.2b in 4Q (prev
-$172.9) on wider goods and services and unilateral transfer gaps, and a
smaller investment income surplus. The data included annual revisions.

[kennynah]

he says, she says...so... have some salt standy

18 Jun 2008 12:45 GMT
Fund managers most underweight on equities in a decade - Merrill Lynch survey

LONDON (Thomson Financial) - Fund managers' stance towards equities is at its most negative in a decade as investors face up to the possibility that interest rates will have to rise to counteract inflation, despite a slowdown in the economy, a survey showed.

Merrill Lynch's survey of fund managers for June showed a net 27 percent underweight on equities, up from just 5 percent in May.

"The market is waking up to the fact that global interest rates are too low, in fact they remain below inflation. Negative real rates are hardly an antidote to inflation," said Karen Olney, chief European equities strategist at Merrill Lynch.

Merrill Lynch expects a two rate hikes from the European Central Bank by October and expects other central banks to follow, she said.

(truncated)