View from The Ships Crow's Nest >>>>>

Now, compared to that new consensus among macro forecasters, who got it wrong in the past, my views are much more bearish. I would agree that the rate of economic contraction is slowing down. But we're still contracting at a pretty fast rate. I see the economy contracting all the way through the end of the year, going from minus 6 to minus 2, not plus 2. And next year the growth of the economy is going to be very slow, 0.5 percent as opposed to the 2 percent–plus predicted by the consensus. Also, the unemployment rate this year is going to be above 10 percent, and is likely to be close to 11 percent next year. Thus, next year is still going to feel like a recession, even if we're technically out of the recession. The outlook for Europe and Japan, both this year and next year, is even worse. Most of the advanced economies are going to do worse than the United States for a number of reasons, including structural factors in Japan and weak policy response in the case of the Euro zo...

Seeking alpha article: OUCH! It's kind of funny how the IMF (International Monetary Fund) has gone from irrelevance to center stage in just a matter of months. Following quickly on the heels of last week's news that the Federal Reserve plans to print up another trillion dollars came this announcement that a UN panel wants to replace the greenback with a shared basket of currencies. Monday, according to this Reuters report (hat tip MA), China loudly seconded the plan. Earlier Monday, China’s central bank governor, Zhou Xiaochuan, offered a bold proposal to overhaul the global monetary system and replace the dollar with the IMF SDR (Special Drawing Right). The SDR, an international reserve asset created by the IMF in 1969 but little used since that time, has the potential to act as a super-sovereign reserve currency, eliminating risks inherent in any single currency used for that purpose. In a speech that took the unusual step of being issued in both Chinese and English, Mr. Zhou...

Awesome overview of history of bear markets Click here for an interactive CHART

When will this horrible recession be over? According to one surprising source, it’s over right now. The source is Robert J. Gordon, an acclaimed macroeconomist and professor at Northwestern University. It’s surprising to learn he thinks the recession is over, because he is one of seven members of the elite Business Cycle Dating Committee of the National Bureau of Economic Analysis . These are the people who decide officially, for the record books, when recessions begin and end—usually many months after the fact, when the decision is really obvious. I’m unaware of any previous case in which a member of this Committee has ever stepped forward and declared the end of a recession in real time. Gordon bases his gutsy call on an indicator that he says the Committee never even looks at: claims for unemployment benefits. He’s talking about the so-called “jobless claims” number that is released every Thursday morning before the market opens. Based on detailed data from state agencies, it repor...

Jessies Americain Cafe' Jesse's Café Américain : "Don't blame the Democrats alone for this. Instead blame a political system that is corrupted by Wall Street and lobbyist money, and a mainstream media dominated by four corporations feeding a stream of managed news and perception spin to gullible US households. The day of reckoning is nearly at hand, in which the currency crisis in the US will shake the financial foundations of the global economy. 'Outlays are rising at 17% YOY the fastest nominal pace since late 1981. With receipts falling 14.6% YOY their fastest drop in at least 40 years the gap between their growth rates is also the widest in the record. All these rates are accelerating and are threatening to push the deficit to more than 50% of receipts and - at $1.1 trillion and rising - to more than 10% of private GDP.' Thanks to Sean Corrigan at Diapason Trading for this chart."

April 2009 Chart: Durable Goods New Orders Durable Goods New Orders AS of Mid-2008 - the long view

Jesse's Café Américain : Take the RED Pill of the Blue Pill? "...You take the blue pill, the story ends, you wake up in your bed and believe whatever you want to believe.You take the red pill, you stay in Wonderland, and I show you how deep the rabbit hole goes."Morpheus in The Matrix ..The elite and their acolytes seem to believe that by sustaining the illusion of the Financial Matrix that we create a confidence that will support a national economic system that is based on a credit bubble and a mass illusion of wealth based on paper.... Can we delude ourselves to prosperity? Can a powerful nation and otherwise intelligent people be that venal, faithless and craven?Yes we can. We have been doing it for years. And it can only continue if we gain more control over the real world and the people in it, and bend them to our increasingly irrational will. The triumph of the will."

Why This Rally Is Unsustainable -- Seeking Alpha : "The selling/deleveraging into the rally has already started and should start picking up on volume soon. According to Washington Service, NYSE listed company insiders have been selling into this rally at the fastest rate since October 2007. Insiders sold over $8 for each dollar they purchased of stock in the first three weeks of April. To give that some context, the S&P topped out on October 11, 2007 and declined 57% before hitting March 2009 lows. If everything is so peachy-keen in the market and economy, why aren't insiders buying or at least holding stakes in their own companies? Possibly because they recognize that the 'green shoots' are just weeds."