It’s Coming: “We Are Seeing A Very Material Slow-Down Across The Economy” by Mac Slavo | SHTFPlan.com | June 5, 2014
Remember back in early 2008 when the Presidential election was in full swing and the majority of financial and political pundits were hailing the booming American economy, record home ownership and never ending growth? By the end of the year everyone had changed their tune and the United States of America was, as former Treasury Secretary Henry Paulson said, “on the brink” of an unprecedented collapse. When the stock exchanges turned, credit markets froze up and the U.S. was in the midst of its worst recessionary environment since the Great Depression the oft repeated phrase “nobody saw it coming” was being peddled by the mainstream on every front in an attempt to convince Americans that the crash simply came out of nowhere. The following analysis from The Market Ticker is a blaring alarm. This time no one can say we didn’t see it coming. An interesting paradigm shift is happening here. I monitor lead times and vendor fill requirements on a fairly regular basis, including from some big e-Commerce folks. In the last couple of months I’ve noted a rather dramatic shortening of inventory lead times from them — that is, expectation that if you are a vendor you will be able to ship product to them much faster than before.
Some of these shortenings are really dramatic — 50% or more. Amazon, in particular, is getting extremely aggressive in this regard. This implies that the inventory drawdown we saw in 1Q GDP revisions is going to continue. … I believe we are seeing a very material slow-down across the economy in final demand. Last week’s consumer income and spending report strongly suggested this to be the case, and the big retailers, including online retailers like Amazon, are highly attuned to this dynamic and have the data before the government does (since they’re the ones who collect it!) If they’re making changes like this it is in response to market conditions; they do not want to get stuck with inventory they cannot move, whether their suppliers get paid up front or only on sale or not. Reality is that product that sits is expensive to warehouse and manage while generating zero revenue; that is a direct assault on the top line of the business and that’s the worst place to take such a hit. I don’t think 1Q is an aberration given these changes that I’m seeing across the board with various retailers and supply management. I think it’s economy-wide and in the next quarter or two we’re going to see it show up in bright lights to caterwauls of but nobody saw it coming! Source: Karl Denninger, Market Ticker (Emphasis Added) Essentially, what’s happening here is that business owners don’t want to risk ordering too much inventory all at once like they might do in a healthy economy. This can only be a direct result, as Denninger notes, of market conditions and fear of getting stuck holding inventory they can’t sell. As was noted last month, the American consumer is strapped and their incomes can no longer support the consumption necessary to keep the economy growing. The latest inventory draw-down confirms this effect, as does the fact that major household retail brands are being absolutely pummeled according to their latest earnings reports. The government has officially revised the first quarter economic growth numbers (GDP), confirming that the economy shrunk between January and March of this year. By mid summer we should receive confirmation of a second quarter of negative growth, officially taking the U.S. back into recession. The wind is about to be taken out of the sails of this economy. It should become apparent to all those towing the recovery line in coming months, though they will likely tell us that no one could have known this was going to happen. We’ve been warned. By the end of this year it should be crystal clear.
The Home Refinance Plan Banks Don't Want You Knowing onesmartpenny.com June 5, 2014 When homeowners visit The Easy Loan Site™ official website, they may be surprised at the shockingly low interest rates still available today and to learn of this little known government lending program. One of the best-kept secrets behind reducing your mortgage payment is this government program called the Home Affordable Refinance Plan (HARP), and taking advantage of it now could benefit millions of American homeowners. By refinancing their homes at lower interest rates, homeowners can easily reduce their payments by as much as $4,905 each year. 1 As with most government benefits program, this program won't last long. The good news is that once you’re in, you’re in. If lowering your payments, paying off your mortgage faster, and even taking some cash out would help you, there is no better time than to act now. Mortgage rates have decreased this month, but rates may not stay low if the government changes its economic policy. Act now while rates are still near historic lows and avoid a potential rate hike. A true stimulus package for the middle-class Did you know that the Home Affordable Refinance Program is designed to help middle-class Americans? If your mortgage is less than $625,000, your chances of qualifying are high. The Government wants banks to cut your rates, which puts more money in your pocket, ultimately boosting the economy. But the banks are not happy about this. Here’s why: You have the option to shop lenders other than your current mortgage holder Your home’s Loan-to-value (LTV) may be 80% to 125% Banks will make more money if they keep middle-class Americans at the higher mortgage rate that they negotiated years ago, so they are putting pressure on the Government to reverse this program. "People can really take advantage of this," Obama recently said in Washington, DC, urging homeowners to refinance sooner rather than later.1 The middle class seems to miss out on everything, and jumping on this benefit is a no-brainer. Act fast to refinance your house at these near-historic low refinance rates. If your mortgage rate is higher than 3.11%, you could be saving thousands.
The average monthly savings is $250. Could you use an extra $250/month? On top of additional monthly savings, many homeowners could pay off their mortgage faster. Homeowners can now also take advantage of the low rates and their home equity to get a cash out loan for home improvements, pay off debt, a vacation, pay for their children's education. How much could you be saving? Here's an example of how much you could be saving by reducing your rate to 3.25% from 6.25% (based on the rate that many homeowners received from lenders years ago)
How do I get these low rates? The trick to finding the lowest rate is to utilize free websites that will compare available mortgage rates for consumers, allowing them to choose the best one. Our research found that The Easy Loan Site, one of the country’s largest and most respected refinance comparison websites, is one of the few companies with HARP lenders on its network. The good news is that their services are free to homeowners like you. There’s no obligation to homeowners, and The Easy Loan Site offers easy and fast comparisons. It takes about five minutes, and the service is 100% free. You have nothing to lose, except for your money problems!
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