MACROECONOMIA- a Bolsa não é tudo amigos!

[Jeab]

Voltamos aos anos 60...
Jeab

http://www.jornaldenegocios.pt/index.php?template=SHOWNEWS&id=363042

[Cucas]

Informação do dia:

Fed survey finds faint signs of hope
Fed survey finds scattered signs that steep plunge in economic activity starting to moderate

    *  Martin Crutsinger, AP Economics Writer
    * Wednesday April 15, 2009, 3:47 pm EDT

WASHINGTON (AP) -- The Federal Reserve said Wednesday there are some faint signs the steep plunge in economic activity that began last fall is starting to level off.

The Fed's latest survey of business conditions nationwide found five of its 12 regional banks reporting a moderation in the pace of the economic decline.

Several regions "saw signs that activity in some sectors was stabilizing at a low level ... (but) overall economic activity contracted further or remained weak," the Fed said.

The survey, known as the Beige Book, struck a slightly more positive tone than last month's report, which described an economy plunging rapidly after the financial shocks that occurred last fall.

Both President Barack Obama and Federal Reserve Chairman Ben Bernanke on Tuesday mentioned some recent signs of progress while cautioning that the recession was far from over.

Information in the new Fed survey underscored that view. The report listed a host of problems in the manufacturing, home building, and travel and tourism sectors, but noted some faint signals that the steep fall in activity was starting to moderate.

In one sign of a possible rebound, the report said while home prices and new home construction declined in most parts of the country, the number of people shopping for homes was beginning to rise, leading to a scattered pickup in sales in a number of districts.

The Fed also said several districts observed a slowdown in the pace of manufacturing declines. The Cleveland, New York and Dallas regions reported a leveling off in the pace of declines in new orders.

The nation's job market, though, is not improving. "Labor market conditions were weak and reports of layoffs, reductions in work hours, temporary factory shutdowns, branch closures and hiring freezes remained widespread across districts," the report said.

The Fed found a silver lining in that as well, noting that the job losses have eased worries about inflation being generated by rising wage pressures.

The report also said the credit squeeze that has occurred as banks suffered mounting loan losses did not show any significant improvement. Demand for business loans remains weak.

Still, private economists said the new Fed survey reinforced a slightly more upbeat view on the economy.

"This is good evidence that activity is becoming less bad across the country," said Jennifer Lee, an economist at BMO Capital Markets. "Granted, things are still bad, but less so."

The new survey was based on information each of the regional banks collected in March and early April. It will be used when Fed policymakers next meet to consider their stance on interest rates and other monetary issues on April 28-29.

The Fed is widely expected to keep a key interest rate at a record low of near zero while continuing to supply massive amounts of money to the banking system in the hopes of combatting the worst financial crisis to hit the country in seven decades.

The Fed report said that retail spending remained sluggish but that some districts had seen a slight improvement in sales compared with the previous reporting period.

A rebound in consumer spending is critical since consumers account for about 70 percent of total economic activity. Consumer spending plunged at an annual rate of 4.3 percent in the final three months of last year, the biggest decline in 28 years. That was the major factor leading the overall economy, as measured by the gross domestic product, to contract at an annual rate of 6.3 percent, the worst showing since 1982.

Even though retail sales retreated a bit in March, private economists expect consumer spending to be slightly positive in the first quarter. A small rebound in spending should trim the overall GDP decline in the January-March period to around 5 percent.

However, analysts believe the current quarter should show a slightly slower rate of retreat, with GDP growth perhaps turning slightly positive by the third quarter.

Even if the current recession, which is expected to become the longest downturn in the post World War II period, does end in the second half of this year, economists say unemployment will keep rising until probably this time next year.

The jobless rate hit a 25-year high of 8.5 percent in March, a month when businesses cut another 663,000 jobs. So far in this recession, which began in December 2007, a net total of 5.1 million jobs have been lost.

Abraço, Cucas
Mail: [email protected]
msn: [email protected]

[Cucas]

Boa tarde, malta.

Parece que que também o sentimento de confiança dos consumidores está a recuperar alguma coisa. Será que é para durar?

ECONOMIC REPORT
Consumer sentiment rises in April
By Rex Nutting, MarketWatch
Last update: 10:44 a.m. EDT April 17, 2009

WASHINGTON (MarketWatch) -- U.S. consumer sentiment improved in April, but remained relatively gloomy, according to media reports of a survey released Friday by the University of Michigan and Reuters.

The consumer sentiment index rose to 61.9 from 57.3 in March, boosted by higher stock prices and hopes that the worst of the recession may be soon past. Other gauges of consumer attitudes have also been improving lately.

It's the highest level for sentiment since September 2008, when the financial crisis worsened.

"This report continues to hover in historically low territory, though the advance on the month is an encouraging sign," wrote Ian Pollick, an economist for TD Securities.

Economists surveyed by MarketWatch were looking for an increase in the UMich index to 59.0. The index hit a 28-year low of 55.3 in November.

The expectations index rose to 58.9 in April from 53.5 in March. The current conditions index rose to 66.6 in April from 63.3.

"The recent uptick in consumer moods is related to the government's economic plan," wrote Young Kim, an analyst for Stone & McCarthy Research. "But the government's economic plan alone cannot boost consumer confidence hurt by weak credit, mounting job losses, and continuing distress in the housing market."

Abraço, Cucas
Mail: [email protected]
msn: [email protected]

[Cucas]

Boa tarde, malta.

Com tanta discussão em volta da inflação e deflação encontrei um artigo muito
interessante sobre a matéria. Quem estiver interessado aguente-se à bronca pois o texto não é pequeno . Aqui vai....

Deflationary Shocks: Helping Or Hurting The Economy?

    *  Nicolas Pologeorgis
    * On Tuesday April 21, 2009, 6:39 pm EDT

When an economy undergoes a deflationary shock, the implications can be both positive and negative for consumers and businesses. There is a big difference between the terms disinflation and deflation, which we will first go over before getting into the causes and effects of deflationary shocks, and how these shocks can affect the economy, consumers and businesses.

Disinflation usually occurs during a period of recession and manifests itself by slowing down the rate at which prices increase; this occurs as a result of a decrease in consumer sales. If the inflation rate drops to a lower level than before, technically that difference is disinflation.

Deflation, on the other hand, can be thought of as the opposite of inflation, or as negative inflation, and it occurs when the supply of goods and/or services rises faster than the supply of money.

Deflation and Its Causes
Deflation manifests itself as a simultaneous sustained contraction or decline in:

    * the general level of prices for goods and services that comprise the consumer basket (consumer price index)
    * business and consumer credit availability (credit/lending practices)
    * consumer demand triggered by a decline in the money supply
    * government spending
    * business investment spending
    * investment assets

The precursor or precondition of deflation can be a recessionary period (which can deteriorate to an economic depression), during which there is either an excessive extension of credit or a huge assumption of debt.

Deflation can be triggered by any combination of the following factors:

    * a decline in the money supply
    * an increase in the supply of goods or services, which exacerbate the situation and further lower prices
    * a decrease in the demand for goods
    * an increase in the demand for money

Either an increase in the demand for or a decrease in the supply of money will result in people wanting more money, which will result in a higher interest rate (price of money). The increased interest rates will result in decreased demand, as consumers and businesses will reduce borrowing money to make purchases.

If deflation is exacerbated, it can throw an economy into a deflationary spiral. This happens when price decreases lead to lower production levels, which, in turn, lead to lower wages, which lead to lower demand by businesses and consumers, which leads to further decreases in prices. Two sectors of the economy that have traditionally remained well-insulated from economic downturns are education and healthcare as their costs and prices may actually increase while the general level of prices for most goods and services declines.

Money Supply and Deflation
Let's examine the factors and components of deflation, the workings of each and how they impact the economy. We'll start with money supply and lending and credit availability.

The money supply is defined as the total amount of money that is available in an economy at a given time; it includes currency and the various types of deposits offered by banks and other depository institutions. Although money no longer has an intrinsic value, it does have four very valuable functions that facilitate the functioning of an economy and a society: it serves as a medium of exchange, unit of account, store of value and standard of deferred payment.

Types of Credit
Credit, and the extension of credit, is the ability of a debtor to access cash to accomplish goals of a financial or non-financial nature. Credit comes in two different forms and each form works and impacts the debtor differently.

The two types of credit are self-liquidating and the non-self-liquidating credit. Self-liquidating credit is usually a loan needed for the production of (capital) goods or provision of services, and it is for a fairly short to intermediate time period. Due to its nature, the use of such credit generates the financial returns and cash flow that enables the loan repayment and adds value to an economy. The non-self-liquidating type of credit is a loan that is used for the purchase of consumer goods (consumption); it is not tied to the production if goods or services, it relies on other sources of income or cash to be repaid and it tends to stay in the system for a long period of time as it does not generate any income or cash to liquidate itself. This type of lending and credit extension tends to be counterproductive and adds a substantial cost (including opportunity cost) instead of value to an economy, as it tends to burden production.

Lending is based on a dual principle: the willingness of the lender to extend credit and provide funds to consumers and businesses, and the ability of the borrower to repay the loan with interest at a given interest rate based on credit scores and ratings (price of money). Both principles rely on the lenders' and the consumers' confidence in each other, and a positive and upward production trend which enables the debtors to pay back their loan obligations. When that upward growth production trend slows down or stops so does confidence, which impacts the desire to lend and the ability to pay back loans.

Such conditions shift the focus of all participants in an economy from growth to conservation and survival. This translates to creditors becoming more conservative and careful on their lending practices and applications, which leads to a decline in consumer and business spending; this subsequently affects production because the demand for goods and services has declined. The decline in business and consumer spending exerts downward pressure on the prices of goods and services and leads to deflation.

Deflation's Impact on an Economy
What really happens during deflationary shocks? People increase their savings and spend less, especially if they are in fear of losing their jobs or other sources of income. The stock market experiences turbulent fluctuations and indicates a declining trend while at the same time there is a decrease in company buy-outs, mergers and hostile takeovers. Governments revise or effect increasingly strict regulation legislation and implement governmental structural changes. As a result of this behavior, investment strategies will switch to less risky and more conservative investment vehicles. In addition, investment strategies will favor tangible investments (real estate, gold/precious metals, collectibles) or short-term investments that tend to maintain their values and provide the consumer with more stable purchasing power.

Macroeconomic Perspective
From a macroeconomic perspective, deflation is caused by a shift in the demand (investment and saving equilibrium) and supply (liquidity preference and money supply equilibrium) curves for final goods and services and a decline in the aggregate demand (GDP), which monetary policy can impact and alter.

When the volume of money and credit transactions decline relative to the volume of goods and services available, then the relative value of each unit of money rises, making prices of goods fall. In actuality it is the value of money itself that fluctuates and not the value of the goods that is reflected in their prices. The price effects of deflation tend to occur and cut across the board in both goods and investment assets.

Microeconomic Perspective
From a microeconomic perspective, deflation affects two important groups: consumers and businesses.

Impact on the Consumer
These are some of the ways that consumers can prepare for deflation:

    * Pay down or pay off any non-self liquidating debt such as personal loans, credit card loans etc.
    * Increase the amount of savings out of each paycheck
    * Maintain retirement contributions despite stock market fluctuations
    * Seek out bargains and negotiate down for any durable goods that need to be acquired or replaced
    * If there is a feeling of insecurity concerning job continuation and stability or income generating assets, start seeking out alternative sources of income
    * Go back to school or update skills to enhance personal marketability

Impact on Business
The following are some of the ways that a business can prepare for deflation:

    * Develop an action plan that will provide alternatives to any of the business aspects, sectors or costs that will be impacted by deflation
    * Do careful planning on the production of goods and services and inventory reduction
    * Investment planning should focus on higher value goods or services and avoid higher cost/lower value ones
    * Increase investments that will boost productivity and reduce costs
    * Re-evaluate all costs and contractual agreements with clients and suppliers and take appropriate action as necessary

Conclusion
Deflation can be beneficial if producers/suppliers can produce more goods at a lower cost, leading to lower prices for consumers. This can be due to either cost-cutting techniques or more efficient production due to improved technology. Deflation can also be perceived as beneficial because it can increase the purchasing power of the currency, which buys more goods and services.

However, deflation can also be harmful to an economy as it forces businesses to cut prices to attract consumers and stimulate the quantity demanded, which has further harmful effects. Deflation also has a harmful effect on borrowers because must they pay back loans in dollars that will buy more goods and services (higher purchasing power) than the dollars they borrowed. Consumers and/or businesses that procure new loans will raise the real or inflation-adjusted cost of credit, which is the exact opposite effect of what the monetary policy tries to accomplish to combat falling demand. Deflation forces a country's central bank to revalue its monetary unit and readjust its economic and regulatory policies to deal with deflationary shocks.

Artigo: http://finance.yahoo.com/news/Deflationary-Shocks-Helping-investopedia-14991355.html?.v=1&.pf=retirement

Eu avisei.....

BFS

Abraço, Cucas
Mail: [email protected]
msn: [email protected]

[Cucas]

Boa noite,

Hoje trago algo de diferente. Para os que se interessam por energias alternativas e pelo impacto que podem ter, económico e não só, aqui vai um artigo sobre a nova aposta das petrolíferas....


Big Oil Sees Promise in Pond Scum
By: Brooke Sopelsa, Writer/Producer | 17 Apr 2009 | 03:33 PM ET

Big oil companies are betting that algae—that's right, pond scum—is a viable source of renewable energy, and they're joining academics, start-ups and the U.S. government in committing resources to studying its potential.

"Oil companies got started in algae research and development and investment in 2007, as they realized that first generation biofuels—grain ethanol and palm or soy biodiesel—would not reach large production quantities cost-effectively," says Brian Fan, senior director of research at the Cleantech Group, a market research firm.

Unlike first generation biofuels, algae has the potential to produce thousands of gallons of oil per acre and does not compete with agriculture for cropland. And because algae are photosynthetic organisms, they feed on carbon dioxide, thus removing some C02 from the air.

Put together, it's an attractive combination.

Here's a snapshot at where the major companies stand.

Para quem tiver interesse em continuar a ler aqui fica o artigo completo:

http://www.cnbc.com/id/30194475

Abraço, Cucas
Mail: [email protected]
msn: [email protected]

[Cucas]

Boa tarde, malta

Aqui vai um artigo sobre as expectativas para a economia nos states.

US Economy To Start Growing in Second Half: Survey
By: Reuters | 10 May 2009 | 08:09 AM ET

The U.S. economy is expected to begin growing in the second half of this year, while the jobless rate is expected to peak in the first quarter of 2010, according to a survey of top forecasters released on Sunday.

The consensus forecast of panelists surveyed in the Blue Chip Economic Indicators newsletter for May predicted economic growth, as measured by real gross domestic product, would shrink 2.8 percent in 2009 but grow 1.9 percent in 2010.

The economic downturn is expected to ease in the second quarter of this year after sharp declines in the fourth quarter of last year and the first quarter of this year, the survey said. Growth is forecast to resume in the third quarter.

The May consensus forecast from the economists saw second-quarter GDP contracting at a 1.7 percent annual rate, 0.4 percentage point better than was forecast a month ago.

In April, the panelists forecast GDP would contract 2.6 percent in 2009 and grow 1.8 percent in 2010.

"The past month provided fresh evidence the decline in business activity is starting to moderate, buttressing consensus expectations that the economy will emerge from recession in the second half of this year," the newsletter said.

The economy is showing some signs of inching toward health. The four-week average of new jobless claims, a better gauge of underlying labor trends because it irons out week-to-week volatility, have fallen for fourth straight weeks.

The Institute of Supply Management's index of activity in the manufacturing sector increased to a seven-month high in April while its index of activity in the service sector jumped to its highest level since October.

Nearly 80 percent of the panelists believe total housing starts are at or near a bottom and residential investment is likely to subtract considerably less if any from GDP in the second quarter and might conceivably begin to contribute slightly to growth by year's end, the survey showed.

The consensus forecast put inflation-adjusted GDP growth in the third quarter of 2009 at a 0.5 percent annual rate compared with a month-earlier forecast of a 0.4 percent rise.

Growth in the fourth quarter is seen at 1.8 percent compared with a 1.6 percent rise forecast a month ago.

While economic growth is expected later in 2009, nearly 32 percent of the panelists expect the unemployment rate to peak in the first quarter of 2010.

They forecast the jobless rate to peak at 10 percent, compared with their 9.8 percent forecast in the April survey.

The Labor Department put the unemployment rate at 8.9 percent in April, the highest since September 1983, from 8.5 percent. The survey was conducted May 4-5.

artigo: http://www.cnbc.com/id/30666635

Abraço, Cucas
Mail: [email protected]
msn: [email protected]

[Cucas]

Boa noite, malta.

Encontrei um artigo no Wall Street Journal que descreve bem a actual situação económica na Europa e dá uma perspectiva do que pode vir a acontecer. Como o artigo é um pouco extenso vou colocar apenas uma parte. Para quem estiver interessado no artigo coloco o link para o lerem na integra. Além do artigo coloco, ainda, um link para um interessante gráfico interactivo da Europa.

Artigo: http://online.wsj.com/article/SB124236774127723161.html

Gráfico: http://online.wsj.com/article/SB124236774127723161.html#articleTabs%3Dinteractive


Record GDP Drop Sharpens Pain Across Euro Zone
German First-Quarter Fall Was Worst Since 1970, but Economists See Seeds of Late 2009 Recovery Amid the Wreckage

By MARCUS WALKER

BERLIN -- The euro-zone economy suffered its sharpest slump on record in the first quarter of 2009, underlining the severity of Europe's recession.

Gross domestic product in the 16-nation euro currency area fell by 2.5% in the period from January to March, compared with the fourth quarter of 2008. That means Europe's economic heartland was contracting at an annualized rate of nearly 10% in the first quarter. Germany, Europe's biggest economy, had an even bigger quarterly fall, its worst since 1970 -- contracting by 3.8%, or an annualized minus 14.4%.

However, the latest monthly indicators for business activity suggest the pace of Europe's recession has slowed sharply. "This kind of pace of contraction will probably not be repeated," said Greg Fuzesi, economist at J.P. Morgan in London: "You're not going to get minus 10% again."

A growing number of analysts believe the euro-zone economy could stabilize by this fall and return to growth around the end of the year, although unemployment is expected to continue rising until well into 2010. Business surveys have shown new orders stabilizing, while big drops in inventories in the past two quarters are expected to lead to higher production by firms in coming months.

"The recession isn't over but it looks as if the worst is behind us and as if it could be over before too long," economists at Credit Suisse wrote in a report on Europe's economy on Friday.

Few business people in Europe are that confident yet, but some see signs that a trough is near. At German engineering company Trumpf Group, which makes machine tools including lasers for cutting metal, orders in the first quarter were down by more than 20% from a year earlier. But in April, orders stopped falling for the first time since the financial crisis escalated in September.

Abraço, Cucas
Mail: [email protected]
msn: [email protected]

[Cucas]

A questão se estamos já em "bull mode" ou se estamos apenas a fazer umas pequenas férias no "Bear Market" continua na ordem do dia. Todos os sites da especialidade lançam, dia após dia, opiniões divergentes a maioria delas dadas por especialistas com provas dadas no mercado o que lança ainda mais a confusão.

No meu entender existem razões de sobra para este confronto de ideias. Os sinais no mercado são divergentes. Por um lado temos os sinais "bull" com muitas empresas acimas da MM de 200 dias, em muitos casos a duplicar ou triplicar a capitalização bolsista, e a caminho de 3 meses de subidas nos índices mundiais. Por outro lado temos o reverso da medalha. A base do sistema
financeiro que são os fundamentais económicos nas suas diversas vertentes  estão uma verdadeira lástima. E será que já bateram no fundo? Parece-me bem que não. Estamos num processo doloroso em que praticamente nenhum sector de actividade escapa.

Com base neste panorama encontrei um artigo que fez relembrar as origens desta crise: o Sub-Prime. As coisas parecem estar a melhorar um pouco mas o sr. Whitney Tilson é da opinião que ainda vamos ter mais alguns anos de crise profunda. Aqui fica o artigo com os fundamentos da sua opinião. Espero que os seus cálculos estejam errados....

Boa leitura...

More Mortgage Meltdown
Posted By:Lee Brodie

Think the financial hurricane has passed? According to one widely followed investor, this is the eye of the storm.

Whitney Tilson, the founder of hedge fund T2 Partners who predicted the credit crisis late last year, has spotted more storm clouds swirling on the horizon. And we're not just talking a passing shower – we're talking run for cover.

Wall Street will be facing " a headwind of continued losses for the better part of five years," Tilson says. In fact Tilson warns that another financial hurricane could be coming. What's turning blue skies to gray?

It's the real estate market. According to Tilson it's far from healed - -and it's about to drag down stocks.

"I think we're in the fifth inning of the credit crisis," he says on Fast Money. "We're only about halfway through."

Tilson firmly believes that there's more mortgage meltdown to come. In fact, he wrote a book about it aptly called "More Mortgage Meltdown" in which he says losses in residential and commercial real estate that still lie ahead – could total more than $1 trillion. That's trillion with a "T".

With unemployment a looming problem, Tilson predicts that mortgage defaults are about to skyrocket— the same with consumer loans.

Also he fully expects trouble in commercial real estate – "the reason it hasn't suffered badly so far is that they're dealing with interest only loans with 5 and 10 year re-sets. Borrowers have been able to make interest payments. It's upon re-set that they probably won't be able to refinance."

The damage Tilson forecasts is kind of scary.

"There are probably going to be $700 billion of losses in total over the next 8 years and we've only seen a few billion of it because those loans haven't reset," he tells the traders.

You know the rest – loans go bad – generating more toxic assets. Those toxic assets hit the banks' balance sheets – bringing bank shares under pressure. The downward spiral just picks up speed from there.

Fortunately there's still time to take shelter. Tilson beleives that investors can not only weather the impending storm, but thrive from the turmoil --  providing they're positioned properly.

In a Reuters report Tilson suggests shorting homebuilders Centex [CTX  8.90    0.05  (+0.56%)   ] and Pulte Homes [PHM  9.36    0.11  (+1.19%)   ] because, there is "virtually no need" for their product for years.

Tilson also thinks regional banks such as Regions [RF  4.04    -0.06  (-1.46%)   ] are worth shoriting as well as bond insurer MBIA [MBI  6.11    0.06  (+0.99%)   ]  which he says is so "under-reserved for losses that it could be seized this year."

Fonte: http://www.cnbc.com/id/30847981

Abraço, Cucas
mail e msn: [email protected]

[MikeC]

PCP quer proibir aumento dos spreads nas renegociações dos empréstimos 
23.06.2009 - 16h04
Por Sofia Rodrigues
O PCP apresentou um projecto de lei que pretende proibir o aumento unilateral do valor dos spreads no âmbito das renegociações dos empréstimos para a compra de casa.

O princípio pretende clarificar a lei em vigor desde 2008 que determinou a impossibilidade dos bancos exigirem a aquisição de cartões de crédito ou outras obrigações bancárias quando os empréstimos são renegociados. Mas há bancos que promoveram o aumento dos valores dos spreads, levando os clientes a queixarem-se ao Banco de Portugal.

Em resposta às reclamações, o Banco de Portugal divulgou uma carta circular onde conclui que a fixação de novos spreads é deixada ao acordo das partes. Para o PCP, esta posição não faz sentido até porque em muitos dos casos as famílias renegoceiam empréstimos quando estão em risco de não conseguirem pagar as prestações. "Estamos a fazer sair pela janela o que se tapou com a porta", disse hoje líder da bancada comunista, Bernardino Soares, em declarações aos jornalistas no Parlamento

Vale sempre a pena ler estas pérolas deste grande partido.


Abraço,
Miguel Costa

[Cucas]

No meio da tempestade há quem veja alguns raios de sol.

Para a secção de economia hoje tenho dois artigos. O primeiro refere vários indicadores que revelaram notícias positivas. Destaque para o desemprego.
O 2º está associado ao 1º e é um resumo histórico da crise nas suas várias fases e ciclos. Está muito desenhado e é interessante passados alguns anos ver este resumo.

Artigo 1

Farrell: Let's Enjoy the Numbers for a Moment

Published: Friday, 10 Jul 2009 | 11:09 AM ET

By: Vince Farrell

Vince Farrell

Vince Farrell
CNBC Contributor

Initial unemployment claims dropped a surprising amount. The expectations were for 600,000 odd and the number came in at 565,000. That is still a staggering number but the breach below 600,000 has been long coming. This measure peaked last April at 659,000. The four week moving average dropped 10,000 to 606,000. While only one week's number, let's still take an encouraging moment and hope that we might be entering a better phase of the economy. The initial negative view is that the number could have been distorted by the July 4th holiday but we will know that soon enough.

The drawback to the report was that continuing claims rose to a record and the length of time people are staying on the rolls is also at a record. The National Employment Law Project projects that by September some 650,000 people will have exhausted their unemployment benefits. If there is to be a "Stimulus II" it will, I believe, be some sort of extension of benefits. There might also be an extension of aid to the states many of which are struggling with budget gaps. It might sound heartless, but to extend further aid to states allows them to avoid taking the harsh cost cutting measures needed to live within their means.

The Conference Board's CEO Confidence Index surged in the second quarter to a 55 reading from the prior quarter's 30. A sub component that measures the current economic environment relative to the environment 6 months ago rocketed to 47 from only 5 the previous quarter. This index has been helpful in the past anticipating upturns in capital expenditures. The index leads cap ex outlays by a few quarters, but this survey is very encouraging. It also dovetails with Soleil's Lyle Gramley's outlook that the economy will turn slightly positive by the third quarter.

Speaking of Lyle, we emailed each other regarding the $3.2 billion decline in consumer credit the other day. It's possible that the dramatically lower decline in consumer credit (the prior two months saw a roughly $16 billion decline for each) is due to better credit availability. A recent survey of "banks willingness to lend" has improved a bit. This will play out but it still marks a huge $62 billion contraction in consumer debt since the peak last year and shows how cautious the consumer is and the level of financial stress they are under.

Laura Martin of Soleil/Media Metrics had an advertising industry expert conference call the other day on the state of the ad world and upfront advertising sales. The consensus seems to be that that total upfront will be down between 10 and 12%. Within that Laura figures NBC [GE  10.78    -0.08  (-0.74%)   ] will be hardest hit since they have a bunch of new shows to sell ad time for including a very big bet on Jay Leno in prime time five days a week. CBS [CBS  5.97    0.01  (+0.17%)   ] has been painted with the same brush, but we feel they will have better selling success. They only have four new shows to sell so advertisers know for the most part what they are buying. They also don't have cable affiliations pressuring them to get deals done since cable usually has to wait for its parent to finish its sales cycle. Laura sees CBS as holding prices flat with last year which would be a bit of a surprise to the consensus view. I might be cautious about buying the stock going into the quarterly release of earnings as I have seen some estimates come down and I wonder if that process is done. But that is a very short term view and we would be looking to buy the stock at the right moment as it has corrected sharply the last few weeks. Laura has a $9 price target. It's currently trading around $6.

Artigo: http://www.cnbc.com/id/31848864

Artigo 2:

Boom, Bust and Blame: CNBC's Comprehensive Special on the Financial Crisis

Como é muito extenso coloco o link de acesso:

Artigo: http://www.cnbc.com/id/31187744

Abraço, Cucas
mail e msn: [email protected]

[Cucas]

Boa tarde, malta!

As coisas continuam beras por esse mundo fora. O artigo de hoje incide sobre o desemprego nos EUA e as medidas que continuam a ser tomadas para ajudar muita gente que começa a ficar no limiar do desespero ao ver os meses a passar e o desejado emprego sem aparecer.

As crises económicas são tramadas. Destrói a forma de subsistência de muitas famílias que no mínimo são obrigadas a alterar a sua forma de vida e os seus hábitos de consumo. É na verdade incrível como no espaço de meses a sociedade sofre alterações passando de uma época de abundância em que praticamente todo é possível face ao crédito fácil, a nível de desemprego baixo e a um apelo ao consumo exacerbado. De repente (meses...) tudo se inverte e parece que fomos viver para outro mundo....Se calhar nas épocas de abundância algumas coisas deveriam ser repensadas quer pelos governos quer pelo consumidores.

Prolonged Aid to Unemployed Is Running Out

Published: Sunday, 2 Aug 2009 | 6:29 AM ET

By: Erik Eckholm
The New York Times

Over the coming months, as many as 1.5 million jobless Americans will exhaust their unemployment insurance benefits, ending what for some has been a last bulwark against foreclosures and destitution.

Help Wanted
Because of emergency extensions already enacted by Congress, laid-off workers in nearly half the states can collect benefits for up to 79 weeks, the longest period since the unemployment insurance program was created in the 1930s. But unemployment in this recession has proved to be especially tenacious, and a wave of job-seekers is using up even this prolonged aid.

Tens of thousands of workers have already used up their benefits, and the numbers are expected to soar in the months to come, reaching half a million by the end of September and 1.5 million by the end of the year, according to new projections by the National Employment Law Project, a private research group.

Unemployment insurance is now a lifeline for nine million Americans, with payments averaging just over $300 per week, varying by state and work history. While many recipients find new jobs before exhausting their benefits, large numbers in the current recession have been unable to find work for a year or more.

Calls are rising for Congress to pass yet another extension this fall, possibly adding 13 more weeks of coverage in states with especially high unemployment. As of June, the national unemployment rate was 9.5 percent, reaching 15.2 percent in Michigan. Even if the recession begins to ease, economists say, jobs will remain scarce for some time to come.

"If more help is not on the way, by September a huge wave of workers will start running out of their critical extended benefits, and many will have nothing left to get by on even as work keeps getting harder to find," said Maurice Emsellem, a policy director of the employment law project.

For many desperate job seekers, any extension will seem a blessing. Pamela C. Lampley of Dillon, S.C., said she sat outside the post office last month and cried because "it was the first Wednesday in quite some time that I've gone to the mailbox and left without an unemployment check." The jobless rate in her state is 12.1 percent.

Ms. Lampley, 40, who is married with three children, lost her job as a human resources officer in January 2008 and had been receiving $351 a week, which covered the groceries and gas. Even so, she and her husband, who still has work as a machinist, were sinking into debt. Now, still poorer, she feels devastated because they cannot buy their son a laptop to take to college and she cannot give her 9-year-old son money for the movies.

In Ohio, where unemployment is 11.1 percent, Cathy Nixon, 39, a mother of four teenagers from Lorain, has been out of work for much of the time since June 2007, and her benefits — $313 a week — run out in September. Ms. Nixon is already fighting foreclosure and said she feared that when the benefits end, "we'll be homeless." She was unable to afford summer camp and baseball activities for her children, despite scrimping on basics.

Raymond Crouse of Columbus operated heavy construction machinery but has found no work since 2007. Mr. Crouse is 72 and receives Social Security but said that was not enough to live on. The $190 a month he has received in unemployment benefits enabled him and his wife to hang on to the house they bought 15 years ago, he said. But with the benefits ending next month, he fears that they will not keep up.

In ordinary times, employers pay into a state insurance fund, and workers who lose jobs draw benefits for up to 26 weeks. During recessions, Congress has often paid for extended coverage for an extra 13 or even 20 weeks.

In 2008, as the recession deepened, Congress provided 33 extra weeks of benefits. Earlier this year, President Obama's stimulus plan offered an additional 20 weeks in states where unemployment surpassed 8 percent, if they adopted new federally recommended rules governing these extra weeks. (South Carolina did not make the changes, and benefits there are running out more quickly.)

Currently, people can draw benefits for up to 79 weeks in 24 states and from 46 weeks to 72 weeks in others.

The stimulus law also, through the end of the year, provided an extra $25 a week to all recipients, exempted a portion of benefits from federal income tax and subsidized Cobra health payments for the unemployed.

Representative Jim McDermott, Democrat of Washington and chairman of the House Subcommittee on Income Security and Family Support, said he would introduce a bill in September to provide yet another 13 weeks of coverage in states with unemployment rates of 9 percent or higher. "Legislators will line up quickly when they start getting calls from desperate constituents," he said in a telephone interview.

The cost would be $40 billion to $70 billion, but the expense would be temporary, Mr. McDermott said.

Some business groups remain skeptical. Douglas Holmes, president of UWC, a group in Washington that represents businesses on unemployment issues, said that there were early glimmers of economic progress and that it was premature to extend benefits again. The money might be better spent, Mr. Holmes said, creating jobs and training people to move into emerging industries.

Traditionally, many economists have been leery of prolonged unemployment benefits because they can reduce the incentive to seek work. But that should not be a concern now because jobs remain so scarce, said Lawrence Katz, a labor economist at Harvard.

For every job that becomes available, about six people are looking, Dr. Katz said. "Unemployment insurance gives income to families who are really suffering and can't find work even if they are hustling to look," he said.

With the economy still listing, he added, a temporary extension can provide a quick fiscal stimulus. And, Dr. Katz said, when people exhaust unemployment and health insurance, many end up applying for disability benefits, which become a large, unending drain on the Treasury.

Ms. Lampley, whose benefits have ended, described the tough job market. She used to make nearly $15 an hour and has unsuccessfully sought office and clerical work at $8 an hour. Mr. Crouse said that even if new building projects were planned, construction slows in the winter cold.

And Ms. Nixon said that she had interviewed endlessly for jobs in real estate and office work and that even her teenagers could not find fast-food jobs because laid-off adults were filling them.

"I can't find a job," she said, "and you can't survive if you don't work."

artigo: http://www.cnbc.com/id/32257252

Abraço, Cucas
mail e msn: [email protected]

[fernandex]

In defence of the dismal science

Aug 6th 2009
From The Economist print edition


In a guest article, Robert Lucas, the John Dewey Distinguished Service Professor of Economics at the University of Chicago, rebuts criticisms that the financial crisis represents a failure of economics



THERE is widespread disappointment with economists now because we did not forecast or prevent the financial crisis of 2008. The Economist's articles of July 18th on the state of economics were an interesting attempt to take stock of two fields, macroeconomics and financial economics, but both pieces were dominated by the views of people who have seized on the crisis as an opportunity to restate criticisms they had voiced long before 2008. Macroeconomists in particular were caricatured as a lost generation educated in the use of valueless, even harmful, mathematical models, an education that made them incapable of conducting sensible economic policy. I think this caricature is nonsense and of no value in thinking about the larger questions: What can the public reasonably expect of specialists in these areas, and how well has it been served by them in the current crisis?

One thing we are not going to have, now or ever, is a set of models that forecasts sudden falls in the value of financial assets, like the declines that followed the failure of Lehman Brothers in September. This is nothing new. It has been known for more than 40 years and is one of the main implications of Eugene Fama's "efficient-market hypothesis" (EMH), which states that the price of a financial asset reflects all relevant, generally available information. If an economist had a formula that could reliably forecast crises a week in advance, say, then that formula would become part of generally available information and prices would fall a week earlier. (The term "efficient" as used here means that individuals use information in their own private interest. It has nothing to do with socially desirable pricing; people often confuse the two.)

Mr Fama arrived at the EMH through some simple theoretical examples. This simplicity was criticised in The Economist's briefing, as though the EMH applied only to these hypothetical cases. But Mr Fama tested the predictions of the EMH on the behaviour of actual prices. These tests could have come out either way, but they came out very favourably. His empirical work was novel and carefully executed. It has been thoroughly challenged by a flood of criticism which has served mainly to confirm the accuracy of the hypothesis. Over the years exceptions and "anomalies" have been discovered (even tiny departures are interesting if you are managing enough money) but for the purposes of macroeconomic analysis and forecasting these departures are too small to matter. The main lesson we should take away from the EMH for policymaking purposes is the futility of trying to deal with crises and recessions by finding central bankers and regulators who can identify and puncture bubbles. If these people exist, we will not be able to afford them.

The Economist's briefing also cited as an example of macroeconomic failure the "reassuring" simulations that Frederic Mishkin, then a governor of the Federal Reserve, presented in the summer of 2007. The charge is that the Fed's FRB/US forecasting model failed to predict the events of September 2008. Yet the simulations were not presented as assurance that no crisis would occur, but as a forecast of what could be expected conditional on a crisis not occurring. Until the Lehman failure the recession was pretty typical of the modest downturns of the post-war period. There was a recession under way, led by the decline in housing construction. Mr Mishkin's forecast was a reasonable estimate of what would have followed if the housing decline had continued to be the only or the main factor involved in the economic downturn. After the Lehman bankruptcy, too, models very like the one Mr Mishkin had used, combined with new information, gave what turned out to be very accurate estimates of the private-spending reductions that ensued over the next two quarters. When Ben Bernanke, the chairman of the Fed, warned Hank Paulson, the then treasury secretary, of the economic danger facing America immediately after Lehman's failure, he knew what he was talking about.

Mr Mishkin recognised the potential for a financial crisis in 2007, of course. Mr Bernanke certainly did as well. But recommending pre-emptive monetary policies on the scale of the policies that were applied later on would have been like turning abruptly off the road because of the potential for someone suddenly to swerve head-on into your lane. The best and only realistic thing you can do in this context is to keep your eyes open and hope for the best.

After Lehman collapsed and the potential for crisis had become a reality, the situation was completely altered. The interest on Treasury bills was close to zero, and those who viewed interest-rate reductions as the only stimulus available to the Fed thought that monetary policy was now exhausted. But Mr Bernanke immediately switched gears, began pumping cash into the banking system, and convinced the Treasury to do the same. Commercial-bank reserves grew from $50 billion at the time of the Lehman failure to something like $800 billion by the end of the year. The injection of Troubled Asset Relief Programme funds added more money to the financial system.

There is understandable controversy about many aspects of these actions but they had the great advantages of speed and reversibility. My own view, as expressed elsewhere, is that these policies were central to relieving a fear-driven rush to liquidity and so alleviating (if only partially) the perceived need for consumers and businesses to reduce spending. The recession is now under control and no responsible forecasters see anything remotely like the 1929-33 contraction in America on the horizon. This outcome did not have to happen, but it did.



Not bad for a Dark Age
Both Mr Bernanke and Mr Mishkin are in the mainstream of what one critic cited in The Economist's briefing calls a "Dark Age of macroeconomics". They are exponents and creative builders of dynamic models and have taught these "spectacularly useless" tools, directly and through textbooks that have become industry standards, to generations of students. Over the past two years they (and many other accomplished macroeconomists) have been centrally involved in responding to the most difficult American economic crisis since the 1930s. They have forecasted what can be forecast and formulated contingency plans ready for use when unforeseeable shocks occurred. They and their colleagues have drawn on recently developed theoretical models when they judged them to have something to contribute. They have drawn on the ideas and research of Keynes from the 1930s, of Friedman and Schwartz in the 1960s, and of many others. I simply see no connection between the reality of the macroeconomics that these people represent and the caricature provided by the critics whose views dominated The Economist's briefing.