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U.S. consumer spending down 1% in December

U.S. consumer spending contracted more than anticipated in December 2008, declining by 1.0%. However, this number is a look into the past and does little to help predict how spending will trend going forward.

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The U.S. is exporting unemployment with ‘Buy America’

Everyone should be concerned about the increasing tone of trade friction in the global economy. While Chinese Premier Wen and U.K. Prime Minister Gordon Brown are setting a positive tone in London today regarding bilateral trade agreements, the U.S. is doing its best to put off trading partners. In fact, in Canada, there seems to be a lot of rancor regarding the ‘Buy America’ provision now being attached to the U.S. stimulus package.

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Chinese migrants losing jobs three times faster than reported

A survey in China has determined that job losses amongst migrant workers are three times worse than had been reported. In fact, 20 million workers in China have already lost employment.

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MagnetBank failure as a canary in the coalmine

In 2008, the FDIC successfully shut down 25 banks. This year it has already been six. To date, the FDIC had generally been able to find a buyer of one of the failed banks’ deposits. After all, outside of IndyMac, the large majority of the failed banks had assets under $1 billion. However, the FDIC failed to find a bank to take over the assets of MagnetBank, one of three FDIC seizures this past Friday.

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‘Buy American’ will translate into a 21st century Smoot-Hawley

Politicians in Washington D.c. have cooked up a nice way to re-create the mistakes of the Great Depression by attaching a ‘Buy American’ provision onto the stimulus bill making its way through Congress. Apparently the Canadians and Europeans have already voiced their concerns, with the Europeans threatening to retaliate.

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TurboTax: targetting ads to Obama’s team problems

TurboTax: targetting ads to Obama’s team problems

This is pretty funny actually (Hat tip Michael Turk).

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Links: 2009-01-31

Remember to switch your RSS feed to http://www.creditwritedowns.com/feed since FeedBurner has not been forwarding my feed correctly. The Most Popular Twitter Acronyms – Digital Inspiration Wall Street suffers worst January – BBC News Outlook for Japan’s economy worsens – FT.com Rogoff: The Global Credit Drought – DealBook Blog – NYTimes.com Fed’s Credit Flirtation Muddles Exit Strategy: Caroline Baum – Bloomberg.com […]

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Job cuts represent structural job losses

Evidence that companies think that much of the downdraft in the economy represents a structural shift to a lower revenue base instead of a cyclical shift comes from the enormous goodwill writedowns companies are taking.  Case and point is the $34 billion writedown by ConocoPhilips which I highlighted (Note of disclosure: I am fairly bullish on energy socks).  If companies […]

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GDP: imports, inflation and local government are the story

GDP: imports, inflation and local government are the story

I have been out the entire morning and haven’t been able to read any news reports on the GDP numbers. However, I have just now had a chance to look at the data and wanted to share my thoughts with you, unfiltered by the media reports. I would sum it up by calling it a story about the three I’s of imports, inflation and investment. But, I will also have a few words to say about state and local government spending as well.

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Wall Street Journal: Right Forecast by Schiff, Wrong Plan?

Wading into the controversy surrounding Peter Schiff’s investment under-performance, the Wall Street Journal has released an article which calls into question the fundamental arguments for Schiff’s investment strategy. Schiff, a fund manager often seen on television, has significantly underperformed the rest of the U.S. stock market, which itself saw a drop of nearly 40% last year. The question is why. Judging from the Journal piece his approach was aggressive and ill-timed. To my mind, this calls into question whether these losses can ever be recouped down the line. I have highlighted in bold the salient points of the article below.

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Nationwide: U.K. house prices down 16.6%

Nationwide: U.K. house prices down 16.6%

The monthly Nationwide Building Society survey is out for house prices in the U.K. The data show an annual fall that is the steepest on record at 16.6%. This means that house prices are now falling more rapidly than ever in the U.K. and that spells bad news as its economy has just entered recession.

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Chinese Premier Wen Jiabao at the World Economic Forum

You heard the quotes (China slams U.S. profligacy). Here’s the video. After some brief introductory remarks Chinese Premier Wen gets down to ripping into the United States.

If you want to get right to his most quotable remarks, they begin right about 6:00 in this long video. Definitely worth watching.

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