Wednesday, June 13, 2012
Gravity Still Operational
Italy is currently being sandbagged by Mr. Market - it paid close to 4% to sell one year sovereigns at the auction today. OUCH! Note that most of the reporting about Italy's debt position is badly off. They ended 2011 at 123% or 124% of GDP. Tax receipts have been lagging despite tax increases, and the economy has been contracting, both of which upset the debt cart. They'll end 2012 at around 127% or 128% of GDP, it appears. The jig is almost up there.
Greece votes next week. Let's just say that the first reaction of the Greeks to the news of the apparently merciful Spanish bank bailout was fury, and a demand that the Greek terms be modified. This was met with harsh German rebuffs, so the political parties pushing for a renegotiation on debt terms have been strongly externally supported by recent events.
Anyone stupid enough to own a Keurig coffee maker is paying about $0.90/cup retail. About $0.50 if you get them wholesale (about double the price from last year).
My local Walmart is trying to sell a 50 inch plasma flat screen for about $450. It's not moving. This same unit was about $3000 two years ago.
HD video camera prices are plummeting. I'd say about 80% over the past year.
Utility prices keep going up. Part of that is living in Alberta, Canada, where our local government is performing massive upgrades to our grid to export our surplus to the U.S. Of course, Americans don't want the cost of the upgrades worked into THEIR power bill so it's in ours. In the meantime the government is telling us how we have a power shortfall (not true -- we have 17% over capacity) and that we need to pay for these upgrades NOW.
We're feeling a bit stretched, to say the least.
The Productivity Miracle of Nonstore Job Destruction (Musical Tribute)
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