The markets are off to the races again and we have reached the hysteria stage, where bad news is coloured as good news or simply ignored.
U.S. Consumers slashed their debt in July by the largest amount on record as job losses and uncertainty took their toll. Credit was cut by $21bn against expectations of $4bn. June's figure was down $15.5bn, leading to an annual decline of 7.4%.
This isn't good for a country where consumers account for 70% of GDP. This is added to the continuing unemployment problem, where -216k jobs was cheered by markets, despite a rise in the unemployment rate to 9.7%. No doubt the 216 number will also be revised downward with next month's figure.
The trade deficit has also widened despite a low dollar, yet the market calls this a sign of commerce returning.
Markets prefer to ignore such data and focus on things such as consumer sentiment, yet consumer and business confidence has only been rising due to stock market rises and would turn on a dime.
The news networks and officials are doing a great job of heralding recovery and calling themselves heroes, yet on the ground and on main street, the outlook is bleak. Rising foreclosures, falling credit, falling spending and shaky confidence.
The economy has picked up due to unpecedented stimulus packages which has been ploughed into markets and GDP boosting schemes, so there is still some risk once we are weaned off the stimulus.
Never before in history has there been such huge levels of interevention from governments to basically take a one-way bet on global recovery. These are the same people who got us in this mess in the first place so it's a bit early to break out the champagne.
U.S. Consumers slashed their debt in July by the largest amount on record as job losses and uncertainty took their toll. Credit was cut by $21bn against expectations of $4bn. June's figure was down $15.5bn, leading to an annual decline of 7.4%.
This isn't good for a country where consumers account for 70% of GDP. This is added to the continuing unemployment problem, where -216k jobs was cheered by markets, despite a rise in the unemployment rate to 9.7%. No doubt the 216 number will also be revised downward with next month's figure.
The trade deficit has also widened despite a low dollar, yet the market calls this a sign of commerce returning.
Markets prefer to ignore such data and focus on things such as consumer sentiment, yet consumer and business confidence has only been rising due to stock market rises and would turn on a dime.
The news networks and officials are doing a great job of heralding recovery and calling themselves heroes, yet on the ground and on main street, the outlook is bleak. Rising foreclosures, falling credit, falling spending and shaky confidence.
The economy has picked up due to unpecedented stimulus packages which has been ploughed into markets and GDP boosting schemes, so there is still some risk once we are weaned off the stimulus.
Never before in history has there been such huge levels of interevention from governments to basically take a one-way bet on global recovery. These are the same people who got us in this mess in the first place so it's a bit early to break out the champagne.
