Ron Paul Grills Bernanke at the Financial Services Hearing

Financial Services Hearing Highlights February 29, 2012

Congressman Ron Paul ‘asks’ Fed Reserve Chairman Ben Bernanke a series
of rapid questions about Fiat Currency, Silver and Inflation.

Quote of the highlight is;
…”that’s why they (the American people) Lose trust in government.”
Referring to the BS Inflation rate of 2%-3%. This portion of the clip is priceless.

 

A Planned Economy for the 1%

From   on Feb 25, 2012

Michael Hudson: All economies have a certain amount of planning,
the question is, for whom?

 

Gasoline Prices Soaring Again

By DataAnalytics

Monthly Gasoline prices SPIKE one more time.

Now $3.65 per gallon (2/24). THAT’S THREE DOLLARS SIXTY FIVE CENTS.
Up $0.08 cents within the week. So far gas has RISEN from $3.23 to $3.65
per gallon just since January.

(2/20)
The average pump price of regular gasoline in the U.S. has
now risen to $3.57
from a month ago at $3.385 p/gal., and
up from $3.171 p/gal., just a year ago. A hefty 12.6% rise.

Price Chart
Here is what the main stream media, the Street and the
department of energy are reporting:

Both Brent and WTI are trading well above $100 per Barrel.

WTI   Brent

The burning question is why.

Here are the corporate owned media ‘talking-points’:

  • Geo-political tensions
  • Possibility of supply interruptions
  • Decreased crude supply from Nigeria and Libya.
  • Decreased capacity from Cushing/Midwestern refinery’s
  • Higher demand from India & China

Nigerian production

 

In turn, this is what investment firms and traders use as
a so-called “inflection point” or “trigger” to artificially drive
prices up, of both crude oil and retail gasoline.

However, here are a number of facts uncovered by DataAnalytics.

Most of the previously lost Libyan production is back to
750-800K/per day.

Nigerian production of approx., 2 mb/per day has been relatively
stable for the past 15 months.

The supposed Geo-political issues in the middle east have been
on-going for the past 40+ years. This is nothing new.

The prospect of supply being disrupted is slight.

U.S. Gasoline demand is at its lowest in 17 years.

E.U. Gasoline demand lowest in a decade

  • The level of supply is elevated
  • The level of demand has decreased

Gasoline supply has increased 9.7% from January.
Refinery utilization has declined from 85.6% to 84%
per day or only 0.4% which equates to -218K per day.
(this is basically a negligible amount)

Other than geo-political rhetoric and wild, unregulated
speculation, the mostly normal and broadly acceptable model
of demand and supply, based on consumption, appears to have
no place in the current price  ‘controls’ established by Wall Street,
OPEC and supposed government regulations.

The fact is that the current and wild speculation is unfounded
and is in the process of creating a gasoline bubble. Just last week,
traders bought 90 million barrels of futures contracts for themselves.

A major consequence of course is increased consumer inflation
and the further erosion of discretionary income and spending.

The most perilous potential result could be a Double-Dip Recession.
The bottom line is that the average consumer will suffer the
most, while only a very select will benefit and benefit enormously.

When supply is up and demand is down, but prices keep rising,
it does not take a PhD to figure out the causation. Which is
neither one of a geo-political, mechanical or physical supply issue.
In short, it is simply the underlying ambition of unreasonable profit,
by baseless speculation, at the great expense of the consuming public.

We are working on a more in-depth story regarding crude oil
and gasoline commodities. Stay tuned.

Preliminary February Unemployment Rate

By DataAnalytics

U3 rate jumps back up to 9%

Gallup’s latest report suggests the BLS will “likely report on the first
Friday of March that its seasonally adjusted unemployment
rate increased in February.”

Gallup Chart

Gallup’s mid-month unemployment rate analysis is a preliminary
estimate of the BLS government report. Data now suggests that the
Bureau of Labor Statistics will likely report on March 2nd that its
“Seasonally Adjusted” U3 unemployment rate will indeed actually
INCREASE 
in February.

Meanwhile, the U6 rate (underemployment/unemployment) has also
spiked up to 19%, from the purported S.A. 15.7%  rate. The take away
here is that the labor market is worsening as we have suggested.

The non-seasonally adjusted data can be a more effective gauge of
the labor markets overall health. That, and the “Mean Duration” of
unemployment, which is near 41 weeks, accompanied by the all
alarming statistic of 43% of those who are unemployed are in that
Long-Term Unemployment category.

Labor Force Participation Rate is the key to deciphering and analyzing
the realistic unemployment rates. From approximately 2000 to 2009,
the LFPR had been about 67% +/-. But in the past 2+ years the LFPR
has been falling and now stands at approximately 64%+/-.

The reality is that the true total underemployment/unemployment
rate could be as high as 36%. Though it is difficult to pin down exact
numbers without having access to payroll income tax data.

But it is safe to state, that the total unemployment rate is roughly
between 25% and 36%. That is One Quarter to One Third of ALL
available would-be workers out of full-time work or out of work all together.

What this latest batch of data suggests, proves, is that the false claims
and bell-ringing of an economic recovery are worthless. The “Hopium”
that is being passed around in the “progressive pipe” has burned a hole
in the brains of those who are buying-in to the massive propaganda
war being waged by the government and the corporate owned media.

The economy is tanking day by day. All of the meaningful economic
indicators are either flat or negative. We have gone over them time and
time again in the last year, but it doesn’t seem to sink in.

Real Retail Sales were 0.0% in December. Preliminary figures
for January were 0.4%,  which will be revised downward again.
Most big name retailers are in serious trouble.

Profit margins in 2011 were down for almost every major retailer.
Many are now in bankruptcy, due to the massive price slashing
efforts in order to gain the foot traffic in the last quarter of 2011.

Auto sales were misleading as well, as the bulk of orders were not
for customers, but rather dealership inventories.

Crude oil and gasoline are spiraling out of control and have seen
double-digit percentage increases over last year at this time. These
rising fuel commodities show no signs of slowing down or reducing
which is further jeopardizing the economy.

Food prices are up and slightly rising as well and are expected to
remain at elevated levels in 2012. Another cold harsh reality is that
Food & Fuel inflation is up approximately 30%+/- from a year ago.

Housing market remains depressed with median prices still falling,
due in part to the huge inventory of distressed properties. With more
foreclosures due to hit the market all throughout 2012, prices will
continue to slide. This will negatively affect existing homes and
mortgage holders who are already underwater.

Debt, both personal and corporate were up in 2011 and will not
abate anytime soon.

GDP for Q4 2011, was 2.8%. Now, strip out the stockpiled inventories
which accounted for 1.9%, then remove autos, 0.6% and ta-da!
Q4 GDP was a Whopping 0.3%! Zero point three of a percent.

There you have it, 5 major indicators of economic activity are flat to
negative and are nowhere near improving because of one simple word:
Jobs. The labor market is the crux of our economic engine, period.

It’s not the stock market or any other insignificant indicator the media
and shill economists tout. Without sufficient labor levels and wages, the
all important Purchasing Power is diminished or completely eliminated.
Which tends to halt almost all economic activity (except necessities)
in our +/-67 percent  “consumption-driven” economy.
(is the light bulb coming on yet?)

Gasoline Prices

By DataAnalytics

UPDATED Post:
February 14, 2012

The mean price per gallon for regular gasoline in the U.S. is now $3.51.
Up 12.5% from one year ago, when prices averaged $3.12 per gallon.
Just a month ago, regular was averaging $3.44 p/gal.
This continual rapid rise is cause for alarm and concern as unemployment
is increasing and the economy is falling deeper towards a double-dip recession.

Feb. 2, 2012
Here’s a quick update on U.S. Fuel Commodity Inflation, part of the
necessary and reoccurring household consuming expenditures.

Unless you have been inducted into the witness protection program or
hiding out in a remote secluded cabin…you know that gas prices at the
pump have been (recently) steadily rising since late November.

 

U.S. Gasoline Chart

 

In the week ending January 31st, the national average for regular
gasoline was $3.439 per gallon. Up from $3.101 p/g one year ago.
That’s a 10.89% increase and a 4.5% rise just in the month of January.

Gas Prices

 

The immediate question is; why? Well of course the most simplistic
and obvious answer would be supply and demand, right? Absolutely,
that would be the correct answer- except that demand for pump gasoline
has been dropping for about the past 3 months.

Demand for pump gasoline during most of 2011 had been approximately
370-million gallons per day, but over the last few months that rate has
fallen to about an average of 340-million gallons per day.

Meanwhile on the supply side, gasoline inventory has increased for the
third straight week, attaining the highest level since March of 2011.
And, with the stockpile of fuel, refinery utilization rate is down by 1.9%.

Typically, U.S. gasoline consumption has historically trended in-step with
employment and with Unemployment at unprecedented highs, the drop-off
in aggregate demand is really no surprise at all.

So the evidence reveals that demand has and continues to decrease, yet
prices at the pump keep rising. Given these two facts, we can surmise that
it is not the result of a Cost-Push trigger whatsoever.

There are many reasons for the jump in crude (both Brent and WTI)
which directly affect retail pump gasoline. DataAnalytics is working
on a story explaining those reasons, which we will publish in the coming months.

The bottom line here is, that the average driving/commuting consumer
is paying approximately 12% more for gasoline than this time last year.
Couple that sizable 15%-20% increase with inflated cost of staple foods
and the grim pressures of affordability to the average American household continue to mount.


The Iron Pump


The Shadow Knows…(Housing 2012)

By DataAnalytics

2012 Housing Market observations:

»Update to original post

Confirmed Data-

•Twelve Million Mortgage Holders are now Underwater (Avg of -59K neg equity)
•Mortgage Delinquencies are rising (+60-day/FHA and Conventional)

•Foreclosures are accumulating (REO and pending)
•Shadow Inventory remains elevated (disclosed & undisclosed)
•Underemployment/Unemployment is stuck at 11+% (U3)
•Wages and salaries are stagnant (which lowers purchasing power)
•Food & Fuel Inflation remains elevated over 2010 levels

Probable Data-

•Mortgage delinquencies will likely increase
•Overall housing inventory will likely increase
•Unemployment will remain in double-digit territory
•Real GDP will remain below 3% through Q3 of 2012
•Public and Private Debt is increasing
•Food & Fuel Inflation will remain high and may increase

As 2012 rang in, there were the so-called experts weighing in on the
Housing Market and their predictions for the new year. Most are choosing
to stand on the side of a declared price-bottom.

»The Fed’s January report stated that 12 million mortgages are
now underwater to the tune of an average –$59,000 negative per loan.
Adding to the already existing $700 Billion in negative home equity.

»So as distressed inventories keep increasing, prices will continue to fall.
Which means, these already negative equity mortgage holders will be
losing even more value in their homes. You can be certain that a portion of
these mortgage holders will be walking-away from their sinking ships…

DataAnalytcis, contrary to main stream prediction, is standing
across the proverbial street, and stating that most of 2012 will
not be the year of a price bottom. Perhaps their might be a start
to a trending uptick beginning in Q4, but only perhaps.

But with at least 1.6 Million units of shadow housing inventory
lurking- (mind you this is ONLY what is being disclosed and reported,
as it is widely believed that there could be upwards of double that figure)
on top of the 2.6 Million of existing units, (nar data is always suspect)
plus 160k of new homes and the approximately 1.5 Million units of
already foreclosed properties and clearly inventory levels are not subsiding.

total housing inventory 07-11

The glut of approximately 5 Million to 6 Million total housing units with
a very likely probability of more distressed properties hitting the market
will keep pushing prices downward. Couple the massive inventory problem
with what is basically flat to little demand AND then add in the major issue of
unemployment to the housing depression mix for a real witches brew…

Fact: 39% of loans in foreclosure have not made a payment in two years,
and 72% have not made a payment in over one year.

• 2.36 million loans over 60 days delinquent.
• 1.84 million loans 90+ days delinquent.
• 2.17 million loans in foreclosure process.

For a grand total of 6.37 million loans delinquent or in foreclosure 
as of September of 2011.

One aspect that is tethered to the unprecedented 22%-23%
underemployment/unemployment rate in the U.S.- is, the
pending 2012 presidential elections.

What do we know about all financial and economic markets? Easy.
Markets like stability, (for the most part) markets thrive in predictable
and certain parameters.

This includes the labor market and the housing market.
DataAnalytics thinks that one of the issues preventing the labor
markets from recovering, is the unpredictability and uncertainty
of the political landscape.

When a market and its manipulators know or have a very good idea of
who is calling the shots, it tends to be more or less predictable.
Fact: Companies are not adding enough jobs to lower the unemployment rate.

underemployment/unemployment rates

While there are various reasons for this; such as the increased costs of
employer-provided health benefits, along with the uncertainty of tax policy,
results in a reluctance to increase hiring or begin to hire. Which can be pinned
down to the current and often unpredictable administration currently in the White House.

But come November 2012, the markets will have a clearer path to its destination;
Whoever secures the White House in 2012, be it the DNC or GOP, the markets
will know what to fairly expect. Although, if this current and ineffective administration
retains the Presidency, the labor market will probably be very slow to improve if at all.
With other major and investment markets following suit.

Market surety is one of the keys to growth in our mixed-market free economy.
Replace abnormal market volatility with some sort of actual cohesion and
the indicators will begin to show signs of Real improvement.

The main issue facing our economy will be the implementation of said
cohesive force- that will enable hiring within the job market. Sounds
easy, right? Well as with almost everything, the delta between theory
and practicality remains vast. Philosophically, Socially and Politically,
those differences are just a few of the stumbling blocks on the road to recovery.

Sinking

Collecting credible data is always challenge in this 24-7, online world.
With the enormous amount of data available, scattered widely
across the many spectrum’s of information, an independent researchers
job to mine reliable data is more difficult than ever.

Information and data collected and then disseminated by the government and
in-house organizations (such as the nar, BLS, nhba, Commerce Dept., etc.,)
usually results in biased and inaccurate reports.

DataAnalytics, an independent resource, always attempts to collect and verify
data then report all discovered information without bias.

Partial data in this report was collected from LPS, CoreLogic and RPX data.