Well, leave it up to my merry band of bloggers to deliver the real news. For those of you that don't prescribe to the "controlled media" theory, ask yourself why none of what your are about to read is reported in the national media?
Mish in Benefit Spending Hits $2Trillion, Highest Percent Since 1929; One Dollar Out of Every Six From Vouchers brings up what should be the total demise of California and two more devastating economic statistics. "Excuse me but is this $17.8 billion deficit in addition to the $24 billion budget deficit? How the Hell is California going to pay that back and fix a $24 billion budget deficit that without a doubt will cause a massive increase in unemployment? Has anyone factored that in?"
While we are on the subjects, why don't we address some of the other 49 states issues, Would not want to be partial to just CA now, would we? TD at Zero Hedge is coming back to life with this "The State Vs. Federal Schism". Want some broad data green shoot fertilizer? "The number of states experiencing revenue shortfalls increased in fiscal 2009. Revenues from all sources which include sales, personal income, corporate income and all other taxes and fees exceed expectations in two states, are on target in ten states, and are below expectations in thirty eight states. This is in contrast to fiscal 2008 when twenty-five states reported that revenue collections exceeded estimates." Just click and read on. So much for that remaining muni income for the elderly might as well wipe that out along with their dividend income.
So now we are over that little hurdle try these two little factoids on for size from Mish's same post on CA. "One in nine Americans are using federal food stamps to help buy groceries as the country's deep recession forced another 591,000 people onto the federal anti-hunger program at latest count." and "In all, government spending on benefits will top $2 trillion in 2009 — an average of $17,000 provided to each U.S. household, federal data show. Benefits rose at a 19% annual rate in the first quarter compared to the last three months of 2008." Let Cudlow throw that in the old mustard seed and green shoot pipe and put a spark to it.
Oh, did anyone notice we lost another 345,000 jobs this month? 9.4% unemployment. I am positive this will be revised, but we had NEGATIVE REVISIONS? Yes indeed, things are improving all around us. GM, Chrysler, Latvia, oh yes, joyous time lie ahead. The saving grace is we've got Timmay, O and Uncle Ben bailing the banks out with all our taxes to save our collective asses. Oops, they are saving their collective asses, screw us. Vive la Bank.
In one of the most delightful articles I have read in a long time Phillip Davis posted this mother load of all hell is gonna break loose article this morning on Seeking Alpha. Taste this sweet little morsel in "Options Trader Thursday Outlook: Triple Top Testing". "Commodities have led this rally with a 14% gain in DBC and a 12% gain in DBA pulling up the OIH and XLE around 10% for the month of May. Since the commodity pushers make up about 20% of the S&P, that’s 2% of the S&P’s 1.5% gains for the month right there! Add the 10% jump in the Nasdaq led by just 6 stocks and the rest of the market must REALLY SUCK for the S&P not to be up 5% at least. Don’t worry, though, there’s more than one way to boost a market. In addition to buying long futures contracts which they never intend to take delivery of and renting tankers to store commodities off-shore to create demand on one end without creating supply on the other (clever isn’t it), our TARP recipients are also our "respected" financial institutions and those that don’t control the media directly can still get plenty of press by UPGRADING the things they are blatantly manipulating." It is just wonderful.
And from Calc Risk lets examine Record High Yield Curve, Rising Mortgage Rates. "The difference in yields between Treasury two- and 10-year notes widened to a record again today ... The so-called yield curve steepened to 2.79 percentage points, surpassing the previous record of 2.75 percentage points set last week. The previous record was 2.74 on Aug. 13, 2003." So, basically if you did not get to refi, or if you had great credit and were denied or if you were one of the millions in line trying to get a refi - fuhgeddaboutit.
Maybe Dan and K are right and P3 is here. The financial pump and dump may have finally come to an end with BoA getting their 33.5b mark. As I noted in an earlier post, banks that lagged to this point raising capital may be toasty critters soon. Don't be surprised to see the banks set record profits next quarter as I am positive they have their shorts in place (not to mention all of the TARP money, the government accountants and the USA and possibly the world by the balls now) Oh, the FDIC only has like 1.3% of the reserves in the bank to cover our deposits, so fugheddabout getting your deposits as well. All is good though. O will be spending a cool T on health care, so we must have some money left. Say goodbye to America folks. I may be loading up on seeds and ammo this summer just in case.