Comments on: The Most Critical Economic Statistic http://www.senseoncents.com/2009/05/the-most-critical-economic-statistic/ Navigating the Economic Landscape Fri, 19 Mar 2010 05:25:05 +0000 http://wordpress.org/?v=2.9.2 hourly 1 By: formerbanker http://www.senseoncents.com/2009/05/the-most-critical-economic-statistic/comment-page-1/#comment-1937 formerbanker Wed, 20 May 2009 02:50:27 +0000 http://www.senseoncents.com/?p=4896#comment-1937 LD - I agree delinquencies are key and they are increasing at substantial rates. Banks are nowhere near reserved enough for coming loan losses - partially due to Accounting rules - as most are reserving only for the next 12 months of expected losses. When it takes anywhere from 6-12 months to go thru the foreclosure process, hey the Banks aren't reserving for the expected loss. Wells Fargo reserves are an absolute joke given there portfolio of Option Arms, 2nd liens and exposure to Jumbo Cali loans. LD – I agree delinquencies are key and they are increasing at substantial rates. Banks are nowhere near reserved enough for coming loan losses – partially due to Accounting rules – as most are reserving only for the next 12 months of expected losses. When it takes anywhere from 6-12 months to go thru the foreclosure process, hey the Banks aren’t reserving for the expected loss. Wells Fargo reserves are an absolute joke given there portfolio of Option Arms, 2nd liens and exposure to Jumbo Cali loans.

]]> By: Increasing Inflation or Playing With Fire http://www.senseoncents.com/2009/05/the-most-critical-economic-statistic/comment-page-1/#comment-1932 Increasing Inflation or Playing With Fire Tue, 19 May 2009 21:21:21 +0000 http://www.senseoncents.com/?p=4896#comment-1932 [...] and corporations are increasingly defaulting and will default at an increasing rate as evidenced by my post earlier this morning highlighting the surge in delinquencies. Individuals and corporations are looking to renegotiate [...] [...] and corporations are increasingly defaulting and will default at an increasing rate as evidenced by my post earlier this morning highlighting the surge in delinquencies. Individuals and corporations are looking to renegotiate [...]

]]> By: fiscalliberal http://www.senseoncents.com/2009/05/the-most-critical-economic-statistic/comment-page-1/#comment-1925 fiscalliberal Tue, 19 May 2009 13:32:46 +0000 http://www.senseoncents.com/?p=4896#comment-1925 So - if delinquencies continue to go up, Merideth Whitney might have a point in saying that there is no basis for consumer spending returning. Car sales in May might be another parameter to watch for bottoming out. The dealer I bought my car from said his sales are 50% of what they were last year. There is a lot of anquish here in the metro Detroit area in terms of long standing dealers being terminated. More over they are not buying back the inventory the terminated dealers had. They have 90 days as a dealer to clear out or sell to other dealers who already have all the inventory they need. Business can lament their plight, however it was their management and labor force (blue and white) who demanded the unsustainable levels. That said, we are no where near where the 1030 depression was , but we are starting to see glimers of it. Just think, a lot of this was unavoidable had the government entities been willing to prosecute fraud which is against the law. So much for the oath of office regarding upholding the laws of the nation So – if delinquencies continue to go up, Merideth Whitney might have a point in saying that there is no basis for consumer spending returning.

Car sales in May might be another parameter to watch for bottoming out. The dealer I bought my car from said his sales are 50% of what they were last year.

There is a lot of anquish here in the metro Detroit area in terms of long standing dealers being terminated. More over they are not buying back the inventory the terminated dealers had. They have 90 days as a dealer to clear out or sell to other dealers who already have all the inventory they need.

Business can lament their plight, however it was their management and labor force (blue and white) who demanded the unsustainable levels. That said, we are no where near where the 1030 depression was , but we are starting to see glimers of it.

Just think, a lot of this was unavoidable had the government entities been willing to prosecute fraud which is against the law. So much for the oath of office regarding upholding the laws of the nation

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