What recovery?

[Alan]

At work on Thursday our CEO made a visit and passed on some encouraging information.

Our China plant and the 2 plants in Holland are at full capacity supplying the APAC market (mostly China).

Our USA plants are at 66% capacity in the USA, but they are holding off starting up the last 3rd until they feel that the increased demand is sustainable and not part of a W or "square root" recovery.

Similarly the hiring, pay and bonus freezes stay in place for the same reason. (our business never actually laid off anyone and at our particular location we are hurting because we have been unable to replace the folks retiring).

 

[tuixiu]

My funds are almost half way back up to where they were before the stock market took the dump.

One of my magic numbers is Dow 10k, since on the way down I stupidly did some impulse moves from cash to equities when it went under 10k thinking it wouldn't go much lower.

For some reason getting back there would make me feel better about it.

 

[IndependentlyPoor]

Green shoots?

Retail sales turned up in August. Some of it due to the cash-for-clunkers program, but results were encouraging even accounting for that.

From:
Calculated Risk: Retail Sales increase in August

 

[tmm99]

I'd say we are kidding ourselves by believing the economy is in recovery. Unemployment is high. Some companies may be reporting earnings but probably by getting tons of employees off their books by laying them off! Housing bust will continue on (ALT-A and Option ARMs) for another couple of years, so I'd say the recovery is going to take more time. In the meantime, if inflation happens (due to printing more dollars), I don't know when the recovery will be. I am really worried about the market going up for no apparent reason...

Call me a pessimist...

 

[Alan]

Call me a pessimist...

You're a pessimist

 

[heyduke]

I'd say we are kidding ourselves by believing the economy is in recovery. Unemployment is high. Some companies may be reporting earnings but probably by getting tons of employees off their books by laying them off! Housing bust will continue on (ALT-A and Option ARMs) for another couple of years, so I'd say the recovery is going to take more time. In the meantime, if inflation happens (due to printing more dollars), I don't know when the recovery will be. I am really worried about the market going up for no apparent reason...

Call me a pessimist...

tmm99, you sell I will buy ... call me an optimist...

 

[tmm99]

You're a pessimist

Thank you Alan. I needed that...

 

[Martha]

Hope there is a recovery. My sister in LA works for a non-profit that contracts with LA county to provide mental health and drug treatment services. They only are hanging on because of stimulus money. She has had to lay some people off.

Another relative that is 55 and has been laid off for quite awhile has no health insurance. He couldn't afford COBRA His UE is up in January.

 

[IndependentlyPoor]

Not all of the news is good. It seems that bank lending is still falling.

from:
Bank Lending Continues to Slip | The Big Picture

 

[ziggy29]

Not all of the news is good. It seems that bank lending is still falling.http://www.ritholtz.com/blog/2009/09/bank-lending-continues-to-slip/

The question is -- is it falling faster than home prices? If not, it doesn't mean fewer loans are being made, just that the average loan is a little smaller.

 

[Alan]

Thank you Alan. I needed that...

You're welcome

I used to be a pessimist, my motto was "If at first you don't succeed, cover up all traces you even tried".

These days I find it all too exhausting to worry about what may be. "Tomorrow is another day, unless the sun doesn't rise"

 

[FUEGO]

Not all of the news is good. It seems that bank lending is still falling.

That reflects the total average outstanding loan balances, right? So in rough terms, the total outstanding loans have decreased from $4.4 trillion at the start of 2009 to $4.2 trillion today? That may reflect the fact that the average savings rate has gone from a moderately negative number to +5% or so in an extremely rapid period of time. People are incurring less new debt, saving more and paying down debt. I also wonder how much of that "average loan balance" has been wiped away through negotiated balance reductions, foreclosures, bankruptcies, and government loan modification programs.

Not necessarily a bad thing long term.