Obama continues to ignore the economic problem. President Clinton at least had some sense.

Obama continues to ignore the economic problem. President Clinton at least had some sense. The problem is mortgages stupid! Barney Frank and Christopher Dodd were giving them (no money down) to people who had no means to make the payments. They got free beautiful housing as they destroyed the property and sold off copper plumbing to try to raise money. Barney let the banks create mortgage derivatives and insurance derivatives and soon banking became Casino Royale. When it came time to pay off the bookies the money was gone. So Obama has been busting bankers knees trying to punish them and is still forcing banks to give no money down mortgages to people he knows will vote for Obama. You know the type, the ones who regularly cheat on taxes who he appoints to run the banking system and the folks who have a be-happy, don’t wanna work culture. President Clinton at least had brains. Clinton worked famously with the republicans and cracked down on welfare abuse. Clinton required the people on welfare take subsidized jobs with local town governments to learn skills in order for them to collect welfare. Welfare dropped to a new low because those people said why work for welfare when they can get a real job in the private sector.

Home prices have sunk to 2002 levels, wiping out a decade's worth of home equity across the U.S. and imperiling the fragile economic recovery. A home-price index released Tuesday showed that prices nationwide fell 4.2% in the first quarter after declining 3.6% in the fourth quarter of 2010. Home prices, which slid in March to their lowest level since the start of the 2006-2009 downturn, have tumbled for eight straight months and continue on their downward spiral with no relief in sight. U.S. housing prices have dropped to their lowest level since 2002. Falling prices hurt economic growth in a number of ways. Not only do homebuyers curb spending when their homes are losing value, but continued price erosion keeps families stuck in homes they can't sell because they are worth less than what they owe. 24% of homeowners are now underwater with mortgages.


World Markets:
China is buying debt and they are very severe with anyone who defaults. Some people wonder whether China will seize Portugal’s Macao and one of Greece’s main islands if they default. Why should the Greeks have Greece when they act more like Obama’s Nigerian cousins? Perhaps the Chinese will deport the Greeks. And who would stop them? Would anyone care any more? The Chinese might get rid of the Greek unions and restore Greece to an intellectual civilization again.

Japan’s industrial production rose 1% which was less than economists forecast in April and unemployment climbed, increasing the likelihood that the economy will contract for a third quarter.

India ranked 87th out of 178 countries in the 2010 Corruption Perceptions Index conducted by Transparency International. Investors in Indian shares consider graft as much of a barrier to economic progress as inflation,

US Economic Highlights
Past Week Initial
Consumer spending cooled in the first quarter more than previously estimated as the jump in food and fuel costs held back the biggest part of the U.S. economy.
Personal Income Apr rose 0.4% vs. 0.5% the previous month
Personal Spending Apr rose 0.4% vs. 0.6% the previous month
PCE Prices - Core Apr 0.2% vs. 0.1% the previous month
Michigan Sentiment - Final May was 74.3 vs. 72.4 the previous month
Pending Home Sales Apr declined -11.6% after being up 5.1% the previous month

Yesterday
Case-Shiller 20-city Index housing prices declined Mar -3.61% after declining -3.33% in April
Chicago PMI manufacturing declined in May to 56.6 from 67.6 in April
Consumer Confidence declined in May to 60.8 from 65.4 in April

This week
Jun 1 7:00 AM MBA Mortgage Index 05/27
Jun 1 7:30 AM Challenger Job Cuts May
Jun 1 8:15 AM ADP Employment Change May
Jun 1 10:00 AM ISM Index May
Jun 1 10:00 AM Construction Spending Apr
Jun 1 3:00 PM Auto Sales Jun
Jun 1 3:00 PM Truck Sales Jun
Jun 2 8:30 AM Initial Claims 05/28
Jun 2 8:30 AM Continuing Claims 05/21
Jun 2 8:30 AM Productivity-Rev. Q1
Jun 2 8:30 AM Unit Labor Costs-Rev. Q1
Jun 2 10:00 AM Factory Orders Apr
Jun 2 11:00 AM Crude Inventories 05/28-
Jun 3 8:30 AM Nonfarm Payrolls May
Jun 3 8:30 AM Nonfarm Private Payrolls May - -
Jun 3 8:30 AM Unemployment Rate May
Jun 3 8:30 AM Hourly Earnings May
Jun 3 8:30 AM Average Workweek May
Jun 3 10:00 AM ISM Services May


Market Outlook June 1, 2011
The US economy continues to tank because, the problem is mortgages stupid, and Obama still does not get it!

U.S. stocks rose yesterday on optimism that Germany would allow Greece to change payment schedules and avoid default.

We are off QE2 and entering the summer period when people sell out and go on a vacation. The stock market is oversold again. On a cash flow (not price basis) there was no new high after the last breakdown and thus a head and shoulders sell signal formed already in “Cash Flow” and is becoming apparent in price action now as well. http://finance.yahoo.com/q/ta?s=^NYA&t=6m&l=on&z=m&q=l&p=m20%2Ce50%2Ce100&a=m26-12-9&c=

The VIX says investors are still very complacent. That correlates more with a decline about to happen
http://finance.yahoo.com/q/bc?s=%5EVIX&t=1y&l=on&z=m&q=l&c=

World trade recovery is a political myth. See: http://www.bloomberg.com/apps/quote?ticker=BDIY:IND Click on the 3yr chart and see full effect of the slowdown. This was Cramer/Lenin/Pravda’s main chart for following China’s growth until it showed stagnation instead.

Asian markets were flat last night. China 0%, Hong Kong down 0.3%, India up 0.6%, and Japan up 0.3%.

European markets are flat this morning in a range of about -0.3% to-0.4% half way through their day.

US pre-market futures are flat today at about -0.1% at 6AM EST.
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