Guest posted by Nonny Mouse
Last week, Bush told reporters at a White House Press conference that not only is the country not in trouble now, it’s not heading for a recession any time in the near future. Everything in Bush World is still hunky-dory.
“I believe that our economy has got the fundamentals in place for us to ... grow and continue growing, more robustly hopefully than we're growing now.”
But he’s standing up on that podium stark naked, and it’s glaringly obvious – if not to him, or to a few blinded-by-desperate-hope diehards in his base – to those around the rest of the world that the Emperor has no clothes. Not so much as a patriotic flag pin to hide his State of The Undress.
In his article, ‘Housing Market Horrors’, David Stevenson, a columnist for the British on-line financial blog, The Motley Fool, is one of an increasing number of people around the world standing on the sidelines of the Emperor’s last grand parade, and pointing his finger at the Decider’s… um… Disrobement.
American new home sales in January shrank to a 13-year low, while home foreclosures jumped 8% in January and by 57% from a year earlier. Bank repossessions soared 90% from a year earlier, with Nevada, California and Florida having the highest foreclosure rates. House prices tumbled almost 9% in the final quarter of 2007 from a year ago in the biggest depreciation since comparative records began in 1987.
US consumer confidence has dropped to its lowest level in five years, with the latest Conference Board index now pointing to the worst outlook for 17 years. The proportion of respondents believing jobs are plentiful waned to 20.6% from 23.8% last month. Consumer spending stalled for a second month, increasing concerns that the part of the economy that accounts for two-thirds of annual output is faltering. Meaning, the average American's outlay on debt service, housing, medical care, food and energy now accounts for over two-thirds of his total spending, the highest since record-keeping began in 1980, according to Bloomberg.
Stagflation has arrived. And it’s getting worse… fast…