Stocks enter the final hour mixed on little real news. Since Monday the DOW has lost some 300 points or about 3% while the NASDAQ is down a little over 100 points or almost 5%.
The July CPI increased .3%, almost all of that thanks to a 2.6% increase in energy costs. On an annualized basis the CPI increased to 1.3%, food gained .9% while energy jumped 5.2% over the last 12-months. This puts the CPI at the lowest level since the 60’s. Retail sales increased .4% in July as per the Census Bureau, almost all of the increase is attributable to auto and gasoline sales the later compliments of an increase in energy prices.
Loss severities are increasing for CMBS as per a recent report from Moody’s as they exceeded their historical average in the 2nd quarter. Average loss rates jumped to 42.8% last quarter an increase of 740 basis points and Moody’s expects losses to increase further. This underscores the problems in commercial real estate brought on by increasing vacancy rates are falling values. Through mid June of this year 3.2 billion in CMBS has been liquidated a figure more than 5 times greater than the same period a year ago as the Commercial Real Estate debacle starts to manifest in an environment of little if any credit and impaired values and cash flow models.
Over the last several years there has been a constant parade of blatant greed and corruption as the current crises grew and then manifested itself into the mess we have today.
I was raised by “hippies” after being born in 1965. Growing up the general consensus in my house was that the corporations and the government where corrupt, unethical and couldn’t be trusted. As a young adult I thought that view to be idealistic and strident.
As an older adult, an appreciation for the bigger scheme of things and front row seats on both how my industry works and of course the current financial crises has left me thinking that my “hippie” parents weren’t so idealistic and naive as I originally thought.
Because the corporations and the government are both corrupt and unethical, while working hand in hand to exploit the populace as they would any other “natural resource” be it a forest of trees or a vein of coal.
I think they overplayed their hand this time, just like 1929, hubris breed’s contempt. The societal backlash then was significant and it will be yet again because when somebody loses their job, house, car, savings, pension and concept of fairness and equality as they understood it.
They have nothing left to loose, as evidenced by the increasing level of violent and antisocial acts committed by the 40+ crowd.
-freedom’s just another word for nothing left to lose
Janis Joplin.
Hi and welcome to The Profit Motive, I’m your host Caleb Lawrence. Once upon a time in America the media acted as the watchdog of the corporations and the state. In the modern era it’s all about ratings and profits, opinion has been substituted for news and frequently is presented as fact. 
