I’ve been here, dominating the financial blogosphere, for more than two years. I can tell you, with utmost certainty, you (the internet leech) are always wrong. Through ups and downs, the one consistent indicator has been your inadequacy.
Just four short weeks ago, these message boards were filled with predictions of mushroom clouds detonating over Los Angeles and bombs disguised as flowers being dropped out of rainbow colored blimps, over NYC. Now you’re all foam mouthed bullish—like rabid dogs or squirrels— gnawing away at dead bank carcasses and shit.
Much to my delight, the rainbow/blimp/flower/bomb scenario never panned out. However, I am still hopeful that some errant nuke might find its way west of Nevada.
“The Fly” has been busy with a lot of tedious shit, as of late. Every weekend, Mrs. Fly makes sure that “Mr. Fly” has no more than 5 seconds of idle time available to himself. After all, it’s spring time; there is much work to be done.
Look you, I’m selling banks, like a fur coated pimp in the South Bronx, into earnings. Unemployment is on the rise, especially in the Carolinas.
Here are some recent stats:
|
Employment Data – South |
Unemployment (%) |
Change |
||||
|
|
Feb-08 |
Jan-09 |
Feb-09* |
Y/Y |
M/M |
|
|
North Carolina |
5.2 |
9.7 |
10.7 |
|
5.5 |
1.0 |
|
Charlotte-Gastonia-Concord |
5.2 |
10.5 |
11.7 |
6.5 |
1.2 |
|
|
Greensboro-High Point |
5.4 |
10.6 |
11.6 |
6.2 |
1.0 |
|
|
Raleigh-Cary |
4.1 |
7.9 |
8.8 |
4.7 |
0.9 |
|
|
Winston-Salem |
5.0 |
9.2 |
10.4 |
|
5.4 |
1.2 |
|
South Carolina |
5.7 |
10.3 |
11.0 |
|
5.3 |
0.7 |
|
Charleston-North Charleston-Summerville |
4.6 |
8.6 |
9.1 |
4.5 |
0.5 |
|
|
Columbia |
4.8 |
8.4 |
8.8 |
4.0 |
0.4 |
|
|
Greenville-Mauldin-Easley |
4.8 |
9.2 |
9.8 |
5.0 |
0.6 |
|
|
Myrtle Beach-North Myrtle Beach-Conway |
6.7 |
14.3 |
14.3 |
|
7.6 |
0.0 |
Based upon the BBQ sauce lovin’ hillbillies from the south goin’ broke, I want to sell short BBT. However, at the same time, due to government liars and cheats, I will pair that trade with a little STI; pardon me for suggesting such a thing on a Sunday evening—my apologies.
In short, get ready for some real good ol’ fashioned anti-climatic earnings, starting with the losers at AA, followed by a fresh round of government fuckery via uptick ruling.
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Unemployment is a lagging indicator. Looking ahead, as the market must, all of those unemployed people will eventually die and drop off the chart.
Excellent point!!
However, what of all the new babies? All of those babies need work.
Here’s the thing — a lot of that new unemployment in the Carolinas is due to bank rationalizations.
Which means BB&T — relatively healthy compared to BAC and Wacky, may actually gain some benefit from all those loose bankers, via hiring “the best,” and via market share absorption.
No position in BB&T. Just thinking that they may not be the weakest lamb to target right now.
______________
Thanks for the Frank, as always. That’s a great one.
_____
However, what of all the new babies? All of those babies need work.
Concerned about the demographics always.
My grandmother had six kids, and 22 granchildren.
My mother also had six kids.
Thus far, eight grandchildren.
Best guess — ten, tops.
__________
Do you mean illegal alien, $650 a month each of guv’ment money babies, or babies born to the legal and finacially suffering, no-free-money-because-your’re-a-legal-citizen babies?
BBT pays it’s dividend in a few days, 08-Apr-09. Does this factor into whether or when you will initiate your short?
thx
Jake
That’s fucking nonsense and you know it. If loans start non-performing, all banks in the region will suffer. It’s not good for BBT if BAC suffers. Plus anyway, there is not “talent” to be had, south of NJ.
At any rate, I offered a pair trade, short BBT/long STI for risk management reasons.
Yes, but they can always go back to work pickin’ cotton. (no racism intended).
My wife just had a baby two weeks ago. She had a c-section in a Canadian Hospital. And no, Jake, she hasn’t picked up any nasty infections. In fact her incision is so tight she does 4 sets of 100 sit-ups per day, and won’t have a scar. Is ‘Owen’ a good name for a farmer? ‘cuz land is getting cheaper and wheat is gettin’ steeper; can ya till permafrost? The birth and follow-up HOUSECALL didn’t cost me a dime. Thank you very much Tommy Douglas! (For eschewing eugenics)
Damon — let me be completely serious for a second and say we need all the babies we can get.
Look at the demographic shit storm in Europe and Japan if you don’t believe me.
________
Europistan will have their day in Sharia court.
I love it when you get all market neutral and shit.
STFU asshole.
Elizabeth Warren, chief watchdog of America’s $700bn (£472bn) bank bailout plan, will this week call for the removal of top executives from Citigroup, AIG and other institutions that have received government funds in a damning report that will question the administration’s approach to saving the financial system from collapse.
Warren, a Harvard law professor and chair of the congressional oversight committee monitoring the government’s Troubled Asset Relief Program (TARP), is also set to call for shareholders in those institutions to be “wiped out”. “It is crucial for these things to happen,” she said. “Japan tried to avoid them and just offered subsidy with little or no consequences for management or equity investors, and this is why Japan suffered a lost decade.”
Suze Orman is saying not to pay credit card debt off first (save some cash for desperation, first):
http://www.usnews.com/articles/business/your-money/2009/04/03/suze-orman-and-the-new-rules-of-credit-card-debt.html
Fed Ex just had the first U.S. layoffs in their history.
http://www.memphisdailynews.com/editorial/Article.aspx?id=41746
The times, they are a-changin’
These people have no idea….
Orman makes me want to throw up.
banks are going up
Suze…is…the…shit!!!
Banks can blow me.
HSBC apparently rising on massive dilution. Imagine what MGM would do on looming bankruptcy!
Fuck off
http://tinyurl.com/cttswf
Orman is the female version of Cramer, if that’s possible.
Great, just what we need… another “Warren Commission.”
________
What an angry thread for a quiet Sunday evening.
I think banks are going up too.
Here’s the other reason the market is going up. Almost every fucker you listen to or read is either straight out bearish or slightly bullish to “we’ve gone up enough in a bear market rally”. However most of you fuckers are 100% bearish longer term.
Everone expects a down market into later spring to summer. It’s not that easy fuckers. This market looks like it will climb a wall of worry. Unless new stuff comes out say like the tax cheat stealing a few banks this is going up.
————–
Jake
how do you get away with getting so much free time. My better 1/2 is giving me shit these days about being on the computer on weekends. The nagging is unbearable and is walking very close to getting fired :-).
It’s like she wants to join at the hip like co-joined twins on weekends and that shit is for newly weds.
what’s your secret.
not true. 70% are bullish. you read too many bear blogs
What time frame?
@ J
This could be you:
http://www.hpj.com/FarmRanchManagement/FM9%20NoBull.jpg
oh, that’s painful just looking at it.
Fly,
I’m not surprised by that poll you mentioned . however it doesn’t really kill my point which is that long term people seem to be more bearish than bullish.
mrkcbill gets all his investing advice from Suze Orman. As an aside…Suze Orman is also his lover and she always insists on “taking the top”
Below is from Michelle and her post at Zstock7.com. A good explanation referring to SRS and IYR type stocks:
“Where commercial real estate owners are current on their payments but can’t roll over their debt when it comes due — is going to become a tidal wave in coming years:
Suppose you bought an office building five years ago with 20% down, for an 80% loan-to-value ratio. You have not missed a payment, the building’s value has been stable, your amortization has paid down the loan balance by four percent of the building’s original value. A new loan will have a 76% loan-to-value ratio.
Here’s the problem: nobody will make a commercial mortgage loan with a 76% loan-to-value ratio today. You haven’t missed a mortgage payment, your building is fully leased, you’ve been working down your principal, but the lenders are all scared. Bank regulators are scared. Secondary markets are scared. So you have to pony up additional cash to bring the loan-to-value ratio down to at least 70%, and maybe even 65 or 60%.
What if you don’t have the cash sitting around to do that? You have a maturity default. Your problem is that credit standards tightened faster than you were paying off your loan.” – Michelle
Was in Vegas last Tues–Thurs. Stayed at Treasure Island. Observations: many cranes non-operational at half finished work sites; gang tags on everything in the North end; Wynn’s twin, the Encore, is stupid and empty on the inside; if not for a convention or two at the Venetian, the area would have seemed lonely; far less traffic on the Strip than previous; best deals on houses in the country on accounta there’s so much inventory…don’t believe the “numbers are up” b.s….they’re all short sales and forclosures; all in all had the feeling of “the fall of he holy roller empire.”
Conclusion: ther is not a single gambling stock that I would buy at this time (including suppliers,etc). Bankruptcies/divestitures probably in progress/on the way.
Jed,had missionary sex with Ann Coulter.
Congrats Goin’Fwar on the baby.
My wife had our first last fall here in Halifax at the IWK, and a follow up visit from the nurse, access to nursing assistance for new mothers even now six months later.
Cost: $0
BTW, Jake is right about one thing: birth rates in North America are nearly as miserable as Europe. We need more immigration!
Orman plays for the other team.
Gartman out of his gold trade this am ….
time to buy, within hours.
Howard didn’t take too kindly to my beatdown on Wallstrip for featuring her as someone that was influential.
Wallstrip who?
All you “free health care commies”. Care to tell the whole story? What was your % income tax rate this year? Yep, just as I thought……Cost=$0 my ass!!
Hey we got big hiring at one place in Ca. The state unemployment agency is swamped. 525,000 claims this month, first time ever over 500,000
One question about unemployment as a lagging indicator. How do we know that unemployment has stopped fallling and as a result becomes that lagging that indicator. From what I have read one sign that unemployment has bottomed is that temp employment has turned up, but that has NOT happened yet.
Typical complaining about taxes. Blah blah blah.
At least I see positive personal benefit when I file on April 30 not unlike some places where the money goes, to who knows whom.
I haven’t even mentioned the Baby Bonus cheque:
http://www.cra-arc.gc.ca/bnfts/cctb/menu-eng.html
I am tired of hearing about Unemployment being a lagging indicator. Its also a current and future indicator of problems, including larger state and federal defecits.
Anything you read about about is either bullshit or a lagging indicator. You have to anticapate not think into old news. Why do you think the FLY went short? You people drive me nuts!
Las Vegas will be a ghost town in 2 years. tumbleweeds style.
Prepare for massive dip buying today if there is any. We must get to 900 today. Growth is now hypervized.
Cuervos, cost $0???? There is no free lunch – taxes paid for it. Immigration? From where? Vietnam? Mexico? Are you serious?
Mike Mayo just threw a bucket of ice water in the face of the bank bulls.
BTW I heard Suze Orman plays for the other side, so if mrkcbill could turn her on to some straight sex, he’s gotta be a super fly man. Go mrkcbill, you rock.
Off to work. Have a good trading day.
CKaltner:
Watch average hours worked per week. When it’s declining, as it still is, then its a sign of future rising unemployment.
Once average hours worked per week bottoms and starts to increase, then the next sign to watch for is an increase in overtime hours worked. There are learning curve costs and other hiring costs associated with hiring people (temporary or permanent), so companies generally opt to increase overtime before increasing temporary workers.
Adding permanent workers is the last phase and won’t happen until the recovery is well underway and businesses are confident that a “double dip” recession will be avoided (which I think is the most likely outcome).
Thank you SatanicChihuahua. I believe that is the first time I have ever thanked a hound from hell.