• From the Singapore Business Times – 30 Jul 2009:
“Fed survey sees slowdown moderating, stabilising (sic)”
“WASHINGTON – The pace of the recession has slowed or stabilised in most areas of the United States, the Federal Reserve said on Wednesday in a report that pointed to protracted job market weakness even as the economy transitions to recovery …
“Fed officials say they expect growth to return in the second half of the year, but warn they expect the recovery to be sluggish …”
• From Newsweek :
“The Recession is Over.”
• From President Obama:
“We may be seeing the beginning of the end of the recession … We have stopped the freefall. The market is up and the financial system is no longer on the verge of collapse …
“We just saw home prices rise for the first time in three years. So there’s no doubt that things have gotten better …”
Spinnage. It’s all spinnage.
• The Singapore Business Times – 28 Jul 2009 – also gave us this:
“Weak job market hits US consumer confidence”
“WASHINGTON – US consumer confidence fell for a second straight month in July as a difficult job market weighed on sentiment, the Conference Board reported on Tuesday …
“The weak outlook on current conditions ‘was caused primarily by a worsening job market’, said Lynn Franco, the Conference Board’s research director.
“She said that ‘more consumers are pessimistic about their income expectations, which does not bode well for spending in the months ahead’.”
• Also from the Singapore Business Times – 30 Jul 2009:
“IMF chief cautious on economic recovery”
“PARIS – It is good news that the financial markets are doing better but 2009 will still be a bad year for the world economy, International Monetary Fund Managing Director Dominique Strauss-Kahn said on Wednesday …
“‘We are only halfway through. The rest of the year will not be good’ …
“Mr. Strauss-Kahn also said that the return of the big bonus culture for top banking executives will trigger new ‘dramas’ in the financial sector if tougher regulation is not applied.
“‘I am appalled at what I see,’ he said in reference to multi-billion-dollar bonus provisions set aside at the likes of Wall Street’s Goldman Sachs and top London firms.
“‘The fact that … one of the causes of (the crisis) – the lure of profit, this easy money, the taking of huge risks to make money – is returning so quickly … that appalls me,’ Mr. Strauss-Kahn said.
“He also expressed his sadness at a failure by leaders to ‘put in place regulations preventing this, stopping a small group of men and women drawn to profit from dragging the entire world economy into catastrophe.’
“While Mr. Strauss-Kahn said it was ‘not the job of the IMF’ to press for such regulation, he said the bonus culture ‘is something that has created dramas (for the financial sector) and which will create more again if we don’t put the brakes on.’”
• And from The Times on 31 Jul 2009
“German jobless rate rises to 8.2% in July”
“(Berlin) – Germany’s unemployment rate rose by 0.1 percentage point to 8.2 percent in July over the previous month as the recession continued to hurt the job market, the Federal Labor Agency said yesterday …
“‘The recession in Germany left its mark again on the German labour market,’ said agency director Frank-Juergen Weisse.
“Compared to July 2008, the number of jobless were up by more than a quarter million, with 252,000 more people out of work …
“Germany, Europe’s biggest economy, went into recession last year as the global crisis sapped demand for its exports.
“That was emphasized in another report yesterday from the VDMA trade group, which said orders for German machinery and factory equipment were down 46 percent overall on the year in June.
“The number of jobless has crept up recently, although the impact of the crisis has not yet been dramatic because many employers are using short-time working arrangements to preserve jobs.”
• From Lloyd’s List – Thursday 30 July 2009
“DP World sees 10% fall in box ports volume”
“DP World chief executive Mohsammed Sharaf has described the first six months of 2009 as the ‘most challenging operating environment our industry has ever known’.
“The comments came as DP World reported a 10% fall in consolidated half year container volumes at its 49 terminals worldwide, which handled 12.3 million TEU in the six months to June …
“‘The unpredictable trends in global trade we have seen in the first half of the year continue into the second half of the year’.”
• From The Journal of Commerce 7/30/2009
“BAA First Half Loss Quadruples”
“LONDON – BAA, the world’s biggest airport operator, reported first half pre-tax losses quadrupled from a year ago …
“The company, which owns seven UK airports including London Heathrow, booked an $ 895 million loss in the six months to June 30 compared with a loss of $ 22 million in the year-earlier period.”
• Again from The Journal of Commerce 7/30/2009
“World’s Largest Truck Maker Loses $ 716 Million – Sales slump 56 percent for Freightliner parent Daimler Trucks”
“Daimler’s truck business, the world’s largest, swung to a second quarter loss of $ 718 million from an $ 857 million year-earlier profit on plunging global sales and restructuring costs in the United States and Japan.”
• From the American Shipper 7/31/2009
“The trucking company YRC Worldwide reported a second quarter loss of $ 309 million compared to net profit of $ 35.8 million in the same period last year. Revenue was $ 1.33 billion, down 45 percent from the same period last year.”
“British Airways World Cargo said Friday its first quarter fiscal year revenue dropped 28.1 percent from the same period in 2008.”
“Dutch express giant TNT said Monday its second quarter net profit fell 60.5 percent … while operating income declined 45 percent.”
• And here’s the biggest shocker of all … again from American Shipper 7/31/2009
“Drewry Shipping Consultants said global container terminal operators face their ‘most challenging year ever’ and suggests that some investors may be forced to sell off terminal assets …
“‘The most likely terminal portfolios which may become available are in Drewry’s view those owned by shipping lines. With all container lines under severe financial pressure – and some bankruptcies expected – the sale of some terminal assets owned by some carriers in the near future seems likely.’”
[Remember how AIG, the Canadian Teachers’ Pension Fund, DP World, and a host of wealthy investors and shipping lines just a few short months ago were scrambling to acquire container terminals in the U.S. and around the world? They were being referred to as “cash cows”, and the “gold mines of today”.]
Economists and maritime authorities often spoke of the ninety percent of the world’s economy that passed through those container terminals, so this disastrous development – this upcoming sell-off – should discourage the false optimism of the administration. It’s time to come clean and tell Americans what they’ll be getting in the coming months and years. Otherwise, what U.S. politicians will be getting in the coming months and years will be egg-on-their-faces … or worse.
“We may be seeing the beginning of the end of the recession,” President Obama said. “We have stopped the freefall. The market is up and the financial system is no longer on the verge of collapse … So there’s no doubt that things have gotten better.”
Try selling that to the British, the Dutch, the Germans, or to the 30 million, or so, unemployed Americans. The economic “freefall” hasn’t stopped and now another freefall has begun. The polls are now reporting that the president’s approval numbers are in “freefall”.
Nothing with a “multiplier effect” has emanated from Washington or from those famous “think-tanks”. Economists repeatedly refer to the “Great Depression’ of the 1930s as though they know something about it. They don’t. The Fed Chairman, Ben Bernanke, often claims to have specialized in the study of that economic catastrophe, but his studies certainly touched upon nothing apart from the collapse of the financial system.
No matter how many or how varied the attempts to reinvigorate that Ponzi-like system, nothing worked then and none of those attempts would possibly work now. People were jobless. Homeless. Penniless. Wall Street would have remained in its wrecked state if the Emergency Shipbuilding Programs were not ordained by FDR. The millions and millions of jobs created by those programs put this country and its economy back on its feet, and even Wall Street – that unproducing monkey we’ve had on our backs – was able to resume its greedy ways.
The irony of it all is that post-WWII U.S. administrations mutilated our shipbuilding industry and courted instead the vultures on Wall Street. And if that wasn’t enough, our know-how and manufacturing facilities were handed over to foreign entities. With our factories and jobs gradually disappearing, couldn’t those geniuses foresee the economic catastrophe they were designing?