Posted by Jack
States are all running into financial trouble:
States are being forced to slash spending and cut jobs in order to close a projected $40 billion shortfall in the current fiscal year. That gap, more than triple the size of the previous year’s, is the result of broad economic weakness at the state and local levels that could cause pain throughout this year and into 2010, a report found.
The democrats answer…we must raise taxes and block oil drilling!
Obama is predicted to win 54% of the popular vote:
Pundits tell us that it’s too early to give any credence to general election polls, but what about economic models? Source: Macroeconomic Advisers Macroeconomic Advisers today released the results of its election model, predicting that Democrat Barrack Obama will win 54.8% of the popular vote compared to 45.2% for Republican rival John McCain.
Beige Book only has a few bright spots and they are dimming:
The Feds latest beige book didnt have many bright spots in it, but even those isolated glimmers may be beginning to dim.
Consumer spending was reported as mixed, weak, or slowing in nearly all regions in the report. Exceptions were seen in New York City, where a weak dollar has boosted foreign tourism, and the discount sector.
However, today Costco, one of the nations leading discount chains, surprised investors with a profit warning on inflation concerns. The companys stock declined nearly 12% in midafternoon trading after it said higher fuel costs were cutting into profit margins and inventories remain elevated.
The democrats answer to high oil prices…we must raise taxes and block oil drilling!
Meanwhile, the dollar is starting to pick up some ground against major currencies as oil prices decline and indications build that the Feds next rate move will be up. A stronger dollar and continued economic weakness overseas have the potential to dry up foreign tourism in the U.S.
However, there are some sectors that may be immune to downturns. The beige book reported that although spending on services was generally weak, health care and IT industries partially offset the declines.
The price tag for the nation’s housing crisis escalated again with reports Tuesday that a record number of Californians lost their homes to foreclosure in the last three months and that a potential bailout of mortgage giants Fannie Mae and Freddie Mac could reach $25 billion.
The figures were released as the House prepared to vote as early as today on legislation aimed at staving off foreclosures, stimulating the troubled housing market and providing a government backstop to Fannie Mae and Freddie Mac.
The democrats answer once again…we must raise taxes and block oil drilling!
The borrower escape rate has shown a sharp decline. This is when a homeowner finds himself in trouble and sells or refinances to escape his debt burden before final foreclosure. The Escape rate is show below and its alarming:
Quarter # of defaults in Cal. “escape rate”
2Q 06 20,909 88%
3Q 06 27,218 80.9%
4Q 06 37,994 71%
1Q 07 46,760 52%
2Q 07 53,943 54.6%
3Q 07 72,571 45.9%
4Q 07 81,550 41%
1Q 08 113,809 32%
2Q 08 121,341 22%
Foreclosures were up 261% since 2007. Foreclosures statewide jumped 33.5% in the three months ended June 30, compared with the same period last year, DataQuick Information Systems reported. The 63,061 homes taken back by lenders were the most for a three-month period since the firm began tracking this data in 1992.
And the democrats answer is (drum roll please) …we must raise taxes and block oil drilling! Yes, it is a broken record!