Home › Forums › Financial Markets/Economics › Lower April retail sales…
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May 10, 2007 at 8:22 AM #9046May 10, 2007 at 9:07 AM #52303
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ParticipantI think it’s also the beginning of the spillover effects the powers that be continue to maintain have not been seen.
The “fake” money circulating over the last 5+ years (in the form of debt) is drying up as people can no longer tap into their Housing ATM.
LIGHT-TRUCK SALES HIT BY CONSTRUCTION AND HOUSING SLUMP?
Sears, Kmart same-store sales down in 1st-quarterThese are related to housing, but weak sales at Wal-Mart is definately bad news for an economy that relies on people spending money.
May 10, 2007 at 10:04 AM #52311Anonymous
GuestI’d say that we are feeling the combo of the hangover from the holiday season, the lack of MEW, and higher gas/food prices. Look at how much revolving debt went up too. It’s kind of amazing that it could increase that much and still leave retail high and dry. It looks like credit cards are getting used to service bills and other debt. If so, this’ll get nasty real quick.
Wonder if this will cause GDP to be revised down a bit…
May 10, 2007 at 1:03 PM #52337GuestThe end is here.
Consumers are tapped out: household debt to income is at an all-time high (and matches the rate for Japan at the beginning of its decade-long recession).
Interest rates will resetting higher on teaser rate loans.
Employment is falling (look at the BLS details).
Roubini is now predicting Q1 07 GDP growth to be revised down to 0.7% and for Q2 07 GDP growth to come in at zero or negative.
I recommend that you get out of the market before everyone else wakes up.
May 10, 2007 at 1:47 PM #52354CAwireman
ParticipantJG,
What do you think of “conservative” bonds or ibonds?
Are they at all safe? Thanks!
(Formerly known as cawireman)
May 10, 2007 at 2:13 PM #52361GuestHB/Matthew, the only bonds that I would touch would be U.S. Treasuries. I’m in charge of investing our company’s cash, and that’s where I park it.
All other bonds — including those from stalwarts such as P&G and utilities — are going to get hit by the return of risk premiums to historical norms (i.e., an increase in interest rates).
The return to historical norms for risk premiums may happen next week, in a few months, or next year; I don’t know when folks will wake up. But, I do know that they will wake up.
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