Spain Still Not Junk; Rip Roaring Housing Numbers The Debate; BofA Fudge
Spain is still a non junk status country. The market rumors were wrong. The dollar is weaker and gold rose to $1755 overnight, but has since pulled back to unchanged. But don’t worry, junk status is eventually going to come for Spain., but maybe Spain gets a reprieve until after the U.S. election.
Bad news is banned until after election day, it would seem. What’s welcomed is very good news. After the controversy last week over a face rippingly positive Labor Market report, this morning’s Housing Starts come in up 15 percent. Can we que the Frankie Valli music? “You’re just too good to be true….” That was a great hit when music was great. Seriously, are we now entering housing bubble 2.0? Pme month’s of data does not a trending make, so we shall see if this strong housing data is not a fluke and the next batch comes after election day.
We have a bi polar economy. On the one hand, housing is portrayed as strengthening, on the other food stamp enrollment was up again to nearly 47 million. Labor Department roles look strong until you find out the numbers are skewed by workers being dropped from the calculation and that there has been an onslaught of part time hires who sought the part time work for economic reasons. Yes, to quote Mr. Dickens: “It was the best of times it was the worst of times; it was the age of wisdom it was the age of foolishness…”
Charted, the headline ride of 15% still looks small in comparison to the 10 year average, or where we once were.
I can see it now. Whoever wins in November will be the loser again, and the American public will also be the loser. To run for the White House can be equated to either loving the power trip, or a need to feed a very large ego. Otherwise, what’s to be gained but a huge set of problems that make the occupants of 1600 PA Ave., go gray. Eventually, say in early 2013, the bad and ugly data (or reality) will catch up to these amusing pieces of data we’ve been seeing recently. I’m surprised they aren’t daring (whomever they is) enough to conjure up something like at 100% gain. Lol. Oh, and to quote Art Cashin at UBS on last night’s debate, “Not A High Moment In The History Of The Republic.” Funny and true.
Bank of America
I must touch on Bank of America and it being heralded for breaking even with a whopping EPS of 0 cents per share. I am laughing all the way to my better TD Bank (at least I can get a lollipop at TD. Bof A is up 4 cents on its let’s not knock ‘em dead numbers. The very important numbers reveal another zombie. Noninterest income for the firm, traditionally about half of total revenues in addition to Net Interest Income, has continued to decline, and slid to $10.5 billion down from $18.0 billion year over year. There was a surge in reserve reduction, and despite what said to be a recovery housing picture, the bank’s charge off reserves also soared. Like the old saying goes – “something rotten in Denmark is….”
This is why I like hard assets like the precious metals, especially gold. I would choose gold over fuded numbers, even real fudge, on any day.
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Author Jim Kingsland
Market commentator with focus on Gold and Silver after long broadcast career at FNN, Bloomberg, and Fox. #RandomHouse published author on PMs. Jim has also been involved in projects for CAC and Coinplex.
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