Thursday, January 14, 2010

The great Marc Faber takes some time to speak with Bloomberg about his 2010 outlook:

Foreclosure Flood Coming

Realty Trac just release the foreclosure numbers for December at 349,519; a 15% increase month over month.  The year end total finished at 3,957,643.

The CEO of Realty Trac released a statement saying, "as bad as the 2009 numbers are, they probably would have been worse if not for legislative and industry-related delays in processing delinquent loans."

This means that banks are keeping foreclosures off the market in order to avoid the losses on their balance sheet.

Market observers feel that this avalanche of shadow inventory will not have any impact on the housing recovery.  They assume that the laws of supply and demand will stop working for the first time in history.

Monday, January 11, 2010

Insider Selling

The year has kicked off with a booming stock market bringing the euphoria to an even greater level.  Insiders (corporate board members that understand the true value of their companies) have purchased $4.5 million in company stock.

How much have they sold? $281 million.

They are selling at 62x the rate they are buying.  Unprecedented.

How much higher can the stock market go?  Much higher.  High enough for corporate insiders to offload 100% of their stock to average Americans as they come rushing back into the market.

Just in time for the next slaughter.

Two Charts

One of these two charts shows the stock market during the early 1930's entering the Great Depression.  The other shows the stock market today as we enter the New Depression.  Do you notice any similarities between the two?