News about the results of the Federal Reserve’s “Stress Test” got out, and it sent a shock wave through the financial world. The news was quite disturbing. Although with the caveat that it is not yet confirmed, I recommend reading the summary at Hal Turner’s web site.
Reader “NDSS” mentioned this bit of much-needed common sense from Charles Hugh Smith: Why a 50% Drop in Housing is Not the Bottom. JWR’s comment: Anyone that thinks that the US real estate market will soon “recover” is dreaming. The peak in Alt-A and Option ARM mortgage rate resets won’t be until 2011. And since home mortgages are a major asset of the American banking industry, it won’t be until after real estate bottoms that the banking industry will have any chance of pulling out of its downward spiral.
Norm in Maryland suggested a piece on the potential highs for gold and silver that was posted at Gold-Eagle.com
Items from The Economatrix:
Dow Plunges 290 on Worries about Banks’ Soured Loans
Weiss: Big Bank Profits are Bogus! Massive Public Deception
Hedge Fund Managers Buy Gold Futures
US Economy Facing “Substantial Risks”
Mortgage Industry Changes Throw New Hurdles in Borrowers’ Way
Why A 50% Drop in Housing is Not the Bottom
Banks Must Brace For New Losses
Thin Ice From Here to the Horizon
GE Profits Plunge By 1/3
US Clutches at Straws of Recovery
California Jobless Rate Tops 11%
Skousen: The Economy–Hyping Hope While Peddling Fear
Will Public Pensions be the Next Bailout?
From the latest issue of Time magazine, The New Frugality: The Organic Gardener