President Barack ‘Hoover’ Obama interrupted his posh vacation, his sixth since Memorial Day, on Martha’s Vineyard for a conference call with what’s left of his economic team. Christina Romer, who is leaving shortly attended the call, along with her nemesis, Larry Summers and Treasury Secretary Timothy ‘Turbo Tax’ Geithner. Oddly enough, the ‘point-man’ for Obama’s “Recovery Summer”, VP Joe Biden, was not on the phone. You may recall barely two weeks ago when I described the Hindenburg Omen (see link below), a statistical indicator of a coming stock market crash. We may be moving closer to that event.
One of the conditions for the Hindenburg Omen is that it repeats itself with 34 days. Well, it did happen again in less than two weeks! Historically, once this occurs, there is a 77% possibility of a stock market crash within 90 days. Given the latest housing numbers, unemployment figures and the rest of the economic situation, it appears to be a sure bet.
Yesterday, Minority House Leader, John Boehner (R-OH), called for Larry Summers and Timothy Geithner to resign. He suggests that there are no indications that the economy is recovering. That the Obama economic agenda has been a complete failure.
The past couple days we’ve gotten the latest news on the housing market, a major component in anyone’s economic analysis. The numbers are frightening. Not only has the housing market declined to the lowest point since 1962, when there was almost 40% fewer people in the country, but there is no sign that it has yet to bottom out. Many experts believe we still have at least another 5-10% to go in home prices until we hit rock bottom. Some say the market will not begin to recover for another three to four years.
Also during the past few days, Joe Biden and other White House mouth-pieces have been talking down the idea of extending the Bush tax cuts. They keep telling us it only affects the top 3% of taxpayers. Actually, it effects ALL taxpayers, but let us just look at those top 3% for one moment. They pay over 52% of ALL income taxes! Which, by the way, tax revenue has declined, falling short of projections.
This, naturally, means that the deficits being run up by Obama and his Democrat friends in Congress will be much larger than expected. Much like how those increases in unemployment are always ‘unexpected’. Biden, the great economist, also contends that only the top 3% of small businesses will be impacted by other aspects of the Obama agenda, such as health care ‘reform’. Mind you, 3% of all small businesses equals ONE MILLION companies, and as they are the ‘top 3%’, they tend to be the ones functioning better, earning profits, etc. Unlike those large corporations the taxpayers had to bailout because of their foolish, risky behavior.
Tomorrow we will get the latest initial jobless claims from last week and I suspect that Obama got a preview of them today, which prompted the conference call. Last week they rose to 500,000, a level not seen since November of last year. So hold on to your hats tomorrow.
Obama and his economic team had a conference call today and while no details are available as to what was discussed, it’s a fair bet that it was not good. None of the economic indicators are good. On top of that, the Hindenburg Omen is now officially in effect, with a 77% chance of a stock market crash within 90 days. Even George Soros has reduced his exposure in equities from $25 Billion to $5 Billion in recent months. Will Larry Summers and Timothy Geithner being shown the door soon? Place your bets now!