Unless you’re a turkey, Thanksgiving is usually a happy holiday. But Bill Bonner says the crumbling economy leaves all of us fearing the axe this year. The global credit crisis has taken us into unchartered territory. And government bailouts will only draw out the inevitable correction.
Nations do not purchase their prosperity, says Eric Fry. Since this crisis started last year, the government has thrown around $8 trillion at the problem. But these are banknotes that it has manufactured for itself. And that’s why we may soon face a severe threat from inflation.
This holiday season will be a “bloodbath” for retailers, according to Marc Lichtenfeld. But there are still some companies that will dodge the downtrend. Marc says Kohl’s (NYSE:KSS), Wal-Mart (NYSE:WMT) and Dollar Tree (Nasdaq:DLTR) are well placed to weather the crisis. And they could even benefit from the demise of the competition.
The US auto industry is coming apart at the seams, says Eric Roseman. The ‘Big Three’ are bleeding profusely, and face bankruptcy without a government rescue. If one of General Motors (NYSE:GM), Ford (NYSE:F) and Chrysler is allowed to fail, Eric says the stock market will crash through its 2002 lows. This means investors should stay underweight stocks for the time being.
The chances of the US entering a recession are receding, thanks to the Fed’s slashing of interest rates and injection of capital into the markets, according to San Francisco Fed President Janet Yellen. This from MarketWatch:
Although not so clearly explained by the central bank, Fed officials undertook these unprecedented steps in some measure to ward off what they like to call an “adverse feedback loop.”
Did you notice the government’s latest figures on gas and food prices? If you didn’t know what was going on, it could have given you a “what the heck” moment.
The collapse of the sub-prime mortgage market has had one positive effect: It has exposed the flimsy scaffolding propping up the financial system.
My ongoing premise is the US is now in or near depression mode. It’s a fairly lonely stance to take because almost everyone believes the official economic numbers cast our way. That is a very costly mistake.
Entering a dangerous and troublesome period in financial history…the battle between the forces of inflation and deflation wages on… The Liquidation War…the coming of the Greater Depression…Cattle is no longer such a hot commodity in Argentina…what will hobble agriculture in the future?…and more!