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Many in the mainstream media keep referring to “recovery” as though it is an incontrovertible fact. But to me, the notion that the U.S. economy is on the mend is like a Hollywood set, comprised of realistic-looking facades that are, on closer inspection, empty shells. The following Associated Press report, “Poll Finds Debt-Dogged Americans Stressed Out,” is a case in point [italics mine]:

The economy trudges ahead yet debt dogs many Americans, stressing them out even as they … [visit site to read more]

Just a few weeks ago, most financial analysts continued to insist that the road to recovery stretched far into the future. Now, uncertainty has returned with a vengeance and the stock market has booked its first official 10% correction since this tenuous ‘bull’ market began in the spring of 2009.

In recent days, markets have shown signs of life – but nascent rallies have been quickly smothered. I believe there are five fundamental reasons for this persistent uncertainty.

First, the … [visit site to read more]

An interesting chart from the Bank of Japan’s latest monthly economic report.

Japanese capacity utilization is way down. Around 20% of manufacturing facilities are standing idle.

This is an improvement from the beginning of 2009, when 35% of capacity was shut down. But a marked decrease from pre-financial-crisis levels, when there was almost no excess capacity to be found.

The story is much the same throughout the rest of the developed world. Capacity utilization across the OECD … [visit site to read more]

When a major mainstream media like Forbes compares BP with Goldman Sachs and recommends investors to buy Goldman Sachs (NYSE:GS) stocks, you know the world is in total moral hazard and deserved to be doomed as Marc Faber has always been saying.

Since Forbes is a financial publication, I will refute based on the investment thesis first.  Granted both stocks are high risk plays right now, but I’d venture to say compared to Goldman, BP (NYSE:BP) is obviously oversold and a victim of media … [visit site to read more]

Global equity markets have been hemorrhaging from the debt crisis in the European Union that began in Greece and subsequently spread to Portugal and Spain’s equity markets, losing more than 15% in terms of US dollars since the recent high in mid-April.

With long-term trend-lines broken …

… what are the equity markets telling us?
Stock markets are in a big way driven by underlying economic fundamental factors. Perhaps the single most important indicator of underlying global economic … [visit site to read more]

David Rosenberg, chief economist of Gluskin Sheff & Associates talks with Bloomberg about the outlook for U.S. stocks and gold … [visit site to read more]

In this discussion, Hugh Hendry of Eclectica Asset Management, Gillian Tett of the Financial Times and Prof Jeffrey Sachs of Columbia University discuss the European banking situation.
“I would recommend you panic. The European banking system is in a crisis. Let’s purge this system of its rottenness. Let’s take on a recession. It’s going to be tough, people are gonna lose their jobs. They are going to lose their jobs anyway. We can spread this over 20 years, or we can get rid of it over … [visit site to read more]

Offshore savings account holders may be interested to learn that initial first-quarter growth estimates for the US economy have been revised down.

Figures released by the Commerce Department revealed expansion of three per cent during the first three months of the year, rather than the 3.2 per cent the organization had previously claimed.

Naroff Economics Advisers president Joel Naroff warned the sluggish pace of the recovery is "not going to bring a lot of smiles", adding: "At this pace of economic growth, it will take a long time to bring the unemployment rate down to more reasonable levels."

The number of adults out of work in the US remains high, after increasing to 9.9 per cent in April, with a total of 15.3 million Americans currently jobless.

Earlier this week, research carried out by the National Association for Business Economics predicted economic expansion of 3.2 per cent in 2010 and 2011, revised upwards from an earlier forecast of 3.1 per cent.

Written by Chris Moore

Just as surely as crude’s impressive tumble from May 3rd to the 20th required a reversal to equalize the markets, the 11 percent rally from Tuesday’s trough to Thursday’s peak would necessitate a correction of its own.
Commodities – Energy
Oil’s Impressive Rally Cut Short by Liquidity and Discouraging Data
Crude Oil (LS NYMEX) – $73.97 // -$0.58 // -0.78%
Just as surely as crude’s impressive tumble from May 3rd to the 20th required a reversal to equalize the markets, the 11 percent … [visit site to read more]

Daimler AG (NYSE:DAI), the owner of Mercedes-Benz brand, has revealed that earnings before interest and taxes (EBIT) from the division will exceed the same in the first quarter of 2010. In the first quarter, the division had an EBIT of €806 million ($1.12 billion) in contrast to minus €1.1 billion ($1.5 billion) a year ago. For the full-year 2010, the company expects to generate an EBIT that will be at the upper end of its previous forecast of €2.5 billion to €3 billion ($3.5 billion to … [visit site to read more]