Mountain of Consumer and Mortgage Debt Hold Retirees Hostage...

Budget Deficit A Result of A Leadership Deficit In Washington....

By the end of his first term, President Obama and Congress will have BORROWED more money than the federal government has SPENT over the nation's first 200 years!

Wages (Adjusted for Inflation) Declining Again...

Tax Returns With Zero Or Negative Federal Tax Liability Reaches Soars to 47%!

"Too many takers — not enough givers."

Vantage Point UPDATE: Intermediate-Term and Long-Term Trend Analysis

On Friday, September 23, the S&P 500 closed @ 1136, and that was...
  
    -8.3% BELOW its 12-Month moving average which stood @ 1239.
  -11.4% BELOW its 40-Week moving average which stood @ 1282.
    -5.3% BELOW its 10-Week moving average which stood @ 1200.


Therefore, the INTERMEDIATE-Term trend IS BEARISH and the LONG-Term trend is BEARISH.

Excessive Debt: Why The U.S. Economy Can't Grow

Household, business and government debt is now at $36.5 trillion, a new record.

 This $36.5 trillion of total debt does NOT include the government's unfunded Medicare and Social Security liabilities.

Total government debt now stands at 65% of GDP, a level unseen since World War II.

Total household debt relative to GDP stands at 66%, a far cry from the historical average of only 37% dating back to 1951.

BOTTOM LINE: Until this enormous household, business and government debt overhang is significantly reduced (aka deleveraging) sustained, robust economic growth is highly unlikely.

Bearish Omen for The Stock Market: Copper Drops to New Lows

Chart and article excerpts courtesy of Investors Business Daily

Copper, the so-called red metal with a Ph.D. in economics is used to gauge global activity because it's found in all facets of everyday life, from consumer electronics to building infrastructure. Like most commodities, copper has fallen amid the dollar's newfound strength the past month, owing to safe-haven buying spurred by the European debt crisis.

Tom McClellan, editor of the McClellan Market Report, wrote in his Sept. 16 newsletter that "copper's failure to rally along with the stock market suggests the market will likely give back its gains."

"The global economy is still quite weak, particularly here in the U.S.," said Bill Strazzullo, a partner and chief market strategist at Bell Curve Trading. "We believe you will see the S&P 500 trading around 1000 to 950 and the Dow at 9400 to 9000."

Read the entire Investor Business Daily report here...
Copper ETFs Hit New Low, A Bad Omen For Stocks

Quote of the Day: A Fundamental Economic & Political Fallacy...

A fundamental fallacy is the notion that politicians can "grow the economy" by taking money out of the private sector and spending it wherever it is politically expedient to spend it -- so long as they call spending "investment."

~Thomas Sowell - Economist

Household Income Slumps to 1996 Levels: Ouch!

The income of the typical American family has dropped for the 3rd year in a row and is now roughly where it was in 1996 when adjusted for inflation.

The income of a household considered to be at the statistical middle fell -2.3% to an inflation-adjusted $49,445 in 2010, which is -7.1% below its 1999 peak, the Census Bureau said.

Vantage Point UPDATE: Intermediate-Term and Long-Term Trend Analysis

On Friday, September 16, the S&P 500 closed @ 1216, which was...
  
    -2.8% BELOW its 12-Month moving average which stood @ 1251.
    -5.4% BELOW its 40-Week moving average which stood @ 1285.
    -0.2% BELOW its 10-Week moving average which stood @ 1218.


Therefore, the INTERMEDIATE-Term trend IS BEARISH and the LONG-Term trend is BEARISH.

Quote of The Day: Why France's Biggest Banks Are In Deep Trouble

This scary statistic from a BNP Paribas bank executive who declined to be named...

"The total debt of the three big U.S. banks (Bank of America, JP Morgan and Citigroup) is $5.86 trillion, or 39% of U.S. GDP, while the debts of BNP Paribas, Crédit Agricole and Société Générale (France's three biggest banks) come to €4.7 trillion, or 250% of French GDP."

Are We Headed for A Prolonged Japanese Deflationary Slog?

If you look at the progression of the U.S. stock market boom and bust, it's easy to see comparisons to the long deflationary slog experienced by Japan.

What's more, we have a similar monetary structure (our own currency, with mostly domestically-owned, domestically denominated debt), and we're facing a similar crisis (too much private sector debt).

The Treasury market shows it as well.

The spread between current Treasury yields and yields on Japanese Government Bonds has hit a new multi-decade low.

And beyond that, the progression of the Treasury yield collapse has has gone at a similar pace.

This chart comes from Nomura's Richard Koo, lining up 10-year yields between Japan and the U.S. at the start of each respective crisis.

Bottom Line:

10-year Treasury yields have a lot longer to fall if you think Japan is a good guide. 

Our Debt Ceiling Limit Has Doubled in The Past 7 Years...

After increasing the nation's debt ceiling limit to $15.2 trillion per the legislation signed by President Obama on 08/02/11, we have more than doubled our debt ceiling limit in less than 7 years.

The debt ceiling was $7.4 trillion as of 10/31/04.

Source: Treasury Department

Global Recession Ahead? Crude Oil Says, "Not Yet!"...

When global markets collapsed in 2008, crude oil plunged for 7 consecutive months, crumbling from $147 per barrel in July 2008 and bottoming near $35 a barrel in February 2009. (See monthly crude oil chart above.)

Fast forward to September 2011 where we see crude oil trading near $90 a barrel. 

Bottom Line: 

If a severe global recession takes hold, expect crude oil, a harbinger for global growth, to plunge. So far, that hasn't happened, a positive for the global economy and global financial markets.

Keep a watchful eye on crude oil and copper for warning signs of a global recession.

Vantage Point UPDATE: Intermediate-Term and Long-Term Trend Analysis

On Friday, September 9, the S&P 500 closed @ 1154, putting it...
  
    -7.1% BELOW its 12-Month moving average which stood @ 1242.
  -10.2% BELOW its 40-Week moving average which stood @ 1286.
    -6.2% BELOW its 10-Week moving average which stood @ 1230.


Therefore, the INTERMEDIATE-Term trend IS BEARISH and the LONG-Term trend is BEARISH.

Cartoon of The Day: 9/11 Remembered - 10 Years After

In Government We Mistrust?...

Life Insurance: Unwisely Neglected In Financial Planning...

• 49% — Of U.S. adults who have a financial advisor and a financial plan have discussed adding life insurance.
  
  
• 47% — Of U.S. adults who have a financial advisor and a financial plan said their advisors have never reviewed their existing life insurance policy with them.
  
  
• 28% — Of U.S. adults said they would be interested in a life insurance policy that included long-term coverage.
  
  
  Online survey conducted by Harris Interactive on behalf of Saybrus Partners, Inc., a life insurance partnership and subsidiary of the Phoenix Cos., Inc.  Poll was conducted in late July and surveyed 2,410 adults 18 and older, of which 786 said they currently have a financial advisor.
  
  
  
  

Food Stamp Recipients At An All-Time High...

45.8 million Americans receive food stamps today, an all-time record. 

That represents 1 out of every 7 Americans.

Vantage Point UPDATE: Intermediate-Term and Long-Term Trend Analysis

On Friday, September 2, the S&P 500 closed @ 1174, and that was...
  
    -5.7% BELOW its 12-Month moving average which stood @ 1245.
    -8.8% BELOW its 40-Week moving average which stood @ 1287.
    -6.0% BELOW its 10-Week moving average which stood @ 1249.


Therefore, the INTERMEDIATE-Term trend IS BEARISH and the LONG-Term trend is BEARISH.

The Past Century's 3 Worst Market Slumps...

Quote of The Day: "The world economy is now in the grips of..."

"The world economy is now in the grips of a damaging feedback loop involving deteriorating fundamentals, lagging policy responses and destabilised financial markets.

If policymakers do not act boldly, and do so in a globally-coordinated fashion, the world risks tipping into a prolonged recession with worrisome institutional, political and social consequences."


Mohammed El-Erian, Pimco