More Bad Economic Signs

Despite PresBo's proclamation that this would be a "Recovery Summer," the bad news continues to roll in. It looks like the "double-dip" part of this recession that I (and others) predicted from the beginning may, in fact, be happening soon. Meanwhile, the bad news continues to pile up.

Small investors are fleeing the stock market in droves. This shows a lack of confidence in a strong, robust stock market.

Investors withdrew a staggering $33.12 billion from domestic stock market mutual funds in the first seven months of this year, according to the Investment Company Institute, the mutual fund industry trade group. Now many are choosing investments they deem safer, like bonds.

If that pace continues, more money will be pulled out of these mutual funds in 2010 than in any year since the 1980s, with the exception of 2008, when the global financial crisis peaked.
http://www.msnbc.msn.com/id/38803088/ns/world_news-the_new_york_times

The White House has changed, yet again, how they are counting the "benefits" of the stimulus programming. First it was "jobs created," then "jobs created or saved," and now it's "lives touched"... whatever THAT means. The bottom line is that they are desperate to inflate the numbers to look as impressive as possible. They don't care what actually IS happening in the economy, they just want us to PERCEIVE that things are rosy... so that we'll re-elect the Democrats. Oh, and don't forget that the GAO found that those "jobs created or saved" came with a price tag of $195,000 per job.

Now however, the GAO report shows that the phrase ‘jobs created’ or ‘jobs saved’ is no longer the term of choice. They have decided to go with – wait for it – ‘lives touched’.

Essentially, we’ve now transitioned from the aforementioned terminology, on to ‘jobs funded’, and eventually landed on something reminiscent of an after school special, ‘lives touched’.

In other words, the administration has stumbled upon another way to inflate their job numbers. They were already reporting on those saved or created, but will now include ‘people who at some point have supported a project.’
http://dailycaller.com/2010/08/19/obamanomics-touching-lives-195000-at-a-time/

Existing house sales apparently dropped 12.9% in June, which may lead to another precipitous slide that could drag us back downwards into a deep recession.

A report tomorrow by the Chicago-based National Association of Realtors will show July sales of existing homes plummeted 12.9 percent from June, the biggest monthly loss of 2010, according to the median estimate of economists surveyed by Bloomberg.

New-home sales, which account for less than a 10th of housing transactions, stayed at the second-lowest level on record last month, economists predict Commerce Department data will show on Aug. 25.

Housing led the U.S. out of seven of the last eight recessions. This time, it may kill the recovery.
http://noir.bloomberg.com/apps/news?pid=newsarchive&sid=avpoiUT.LWa0

Consumer confidence is dropping again... never a good sign.

After improving slightly earlier this month, Gallup's Economic Confidence Index declined over the past two weeks to its current -33, matching the average for all of July. The July confidence numbers are the lowest of the year so far; thus, even with the slight uptick in early August, confidence remains below the levels seen during much of 2010 and below its depressed levels of a year ago.
http://www.gallup.com/poll/142637/Economic-Confidence-Down-Recent-Weeks.aspx

Fully half of the participants in the government's mortgage reduction program have dropped out, calling the program a "bureaucratic nightmare."

But The Associated Press reported Friday that almost half of the more than 1.3 million homeowners who enrolled have dropped out, with many complaining "that the government program is a bureaucratic nightmare" of paperwork and red tape.

In addition, bank executives accused the Obama administration of inflating the numbers of those involved by pressuring them to sign up homeowners before verifying they met the program's income qualifications. Subsequently thinning applicants who earned too much to qualify for the taxpayer handout slowed down the time it took to process legitimate applications.

So far, just 32 percent -- a measly 421,804 home­owners -- of those who started the program have actually had their loans modified and are making payments on time. Of the $75 billion the federal government made available for "foreclosure relief," only $490 million had been spent, the AP reports.

Meanwhile the program is now "taking in fewer home­owners" and is "petering out," one economist noted, without having made but a dent in a tide of foreclosures that is expected to continue growing into next year.
http://www.lvrj.com/opinion/a-bureaucratic-nightmare-101284114.html

And this article contains a pretty good summary of the bad signs. It predicts a return to 1970's stagflation (which was a bad thing, btw).
http://www.minyanville.com/businessmarkets/articles/stagflation-inflation-deflation-hyperinflation-money-printing/8/23/2010/id/29730?page=full


Things are bad out there. I didn't even discuss the rising unemployment figures, flattening spending trends, or the dips in several key leading indicators. All this and more points to WORSE times ahead, not better.

With any luck, the loudly proclaimed "Recovery Summer" will be Obama's "Read My Lips" moment.