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Email from Al Hunt (Al sends out interesting emails a couple times a week. If you would like to be on his mailing list, contact him at Al Hunt ammeel@rovin.net ) Interesting Knowledge ALL PLEASE READ!!!
7 Ticking Time Bombs – All
hell is about to break loose on Wall Street.
Seven irrefutable reasons why the great stock market crash that began in
March 2000 is less than HALF OVER! Explosive
device #1 – The great Real Estate Bubble of 2003 is about to explode.
More job losses ahead. The great tidal wave of "surprise"
bankruptcies that hammered U.S. companies throughout 2002 is just
beginning. I count 662 companies that
are now so deeply in debt and suffering from such massive declines in
revenues that they are clearly in danger of failure in the year ahead. Panic
sales of vacation homes are already beginning to hit the market like a
ton of bricks. In the roaring 1990’s, millions of affluent Americans
bought second or even third homes. And now with the market slipping away
a large number of those "unnecessary" homes are beginning to
go up for sale. Explosive
device #2 – A massive $2.4 trillion PENSION CRISIS is about to hammer
the Dow and the S&P 500 into the ground. Right now, major U.S.
companies, the same ones that have sworn their financial statements are
accurate, owe hundreds of billions to
their employee pension funds. Verizon
Communications had multi-billion dollar losses in 2001.
But just by adding in its projected pension fund gains exceeding $2
billion, the company was able to magically report a net profit for the
year of $389 million. Eastman
Kodak lost tens of millions last year.
But by including its projected $100-million-plus profit from its pension
fund, the losses were magically transformed into a $76 million profit.
These examples go on and on. More
than 140 other major companies in the S&P 500 did essentially the
same thing. It’s the greatest accounting scam of all time. Explosive
device #3 – The SECOND great Asian Contagion now threatens to crush
global stock markets. Japanese banks
are hanging by a thread! Japanese stocks are now at 19-year lows and
trending lower. And it’s not over yet. The Nikkei
steamrolled through support at 9500 like a runaway freight train, and
now eyes the 8000 level. Explosive
device #4 – America’s Great Bankruptcy Nightmare has only just
begun. U.S. companies now owe a
record $4.7 trillion to banks, venture capitalists, bondholders, money
funds, and other institutions. Saks
Inc. has just six cents of cash for every dollar of short – term debt. Ford,
which is drowning under $165 billion in total debt, has only 27 cents of
cash on hand to cover every dollar of its debt coming due within the
next 12 months. Verizon,
Maytag, Allied Waste and Nextel are just a few of the other American
corporations that are up to their
eyeballs in debt with little practical hope of repaying. Explosive
device #5 – Washington is about to bring Wall Street to its KNEES.
Federal investigators are getting ready to drop the financial equivalent
of a thermonuclear bomb on Wall Street. They know that Merrill
Lynch, Morgan Stanley, Dean Witter, Credit Suisse First Boston, Bear
Stearns, Salomon Smith Barney, Lizard Freres, Goldman Sachs Group,
Lehman Brothers, UBS Paine Weber took thinly veiled BRIBES in return for
giving their highest "BUY" ratings to stocks they KNEW were
absolute JUNK. They raked in hundreds of millions of dollars
in investment banking business in return for their phony ratings. Explosive
device #6 – America’s largest
BANKS are now suffering loan losses hand over fist. Recent testimony
from Fed Governor Laurence Meyer, banks are now holding the bag for up
to $400 billion in venture capital deals, and many of them aren’t
worth the paper they are printed on. Explosive
device #7 – Wars and rumors of
war are about to send oil and gas prices SKYROCKETING. The
former head of OPEC has now warned that the price of crude will triple
to $100 a barrel in there is a war against Iraq. Osama bin Laden has
pledged, on several occasions, to more than QUADRUPLE oil prices to
more than $144 per barrel. U.S.
Economy in Worst Hiring Slump in 20 Years Wednesday
05 February 2003 The
American economy has fallen into its worst hiring slump in almost 20
years, and many business executives say they remain unsure when it will
end. With
economic growth having slowed to less than 1 percent in recent months, about
one million people appear to have dropped out of the labor force,
neither working nor looking for a job, according to government figures. The
surge in discouraged workers is the most significant since the months
immediately following the Sept. 11 terrorist attacks, and it suggests
that the pain of joblessness is worsening even though the nation's
official unemployment rate, which counts only people looking for work,
held steady at 6 percent in December. The
lack of jobs has also slowed wage growth, so that only workers in the
most affluent group are still gaining ground on inflation, ending
a six-year streak of increases in buying power across the board. "Last
year, I heard a lot of people say, `Come back after the first of the
year; if the economy picks up, we might hire some people,' " said
Tom Koehn, 50, who lost his job in May at a manufacturer of heavy
machinery in South Bend, Ind. "But so far, I haven't found anybody
who's hiring." In
the last two months of 2002, the employment decline became even worse
than it had been at a comparable point in the so-called jobless recovery
of the early 1990's, according to recently revised statistics from the
Department of Labor. The economy has lost more than two million jobs, a
drop of 1.5 percent, since the recent recession began in March 2001, as
layoffs have continued despite the resumption of economic growth more
than a year ago. The decline was 1.3 percent at the same point in the
business cycle a decade ago. Executives
are now saying they have been disappointed too many times already by the
halting growth of the past year to begin hiring workers in significant
numbers. Although the government is likely to report on Friday that the
economy added some jobs in January, many executives are still waiting to
be convinced that business has regained a solid footing after the
collapse of the late-90's economic bubble. The
possibility of a war in Iraq and an increase in oil prices offers
another reason for hesitation, they say. Many companies have also used
new technologies and management techniques to produce more with the same
number of employees. "This
is what I call the new reality," said Robert M. Dutkowsky, the
chief executive of J.D. Edwards, a software maker in Denver that has
kept its work force at 5,000 people for the last few years. "The
environment we're operating in is what it's going to be like for a
while." In
his State of the Union address last week, President Bush called the
improvement of the job market his "first goal" for the coming
year and asked Congress to pass a $670 billion, 10-year tax cut. "We
must have an economy that grows fast enough to employ every man and
woman who seeks a job," Mr. Bush said. "With unemployment
rising, our nation needs more small businesses to open, more companies
to invest and expand, more employers to put up the sign that says, `Help
Wanted.' " Most
economists say the tax plan and another $4 billion in help for the
jobless would have only a small effect on the economy this year. The
number of companies cutting jobs has spiked since November, with AOL
Time Warner, Boeing, Dow Jones, Eastman Kodak, Goodyear, J.C. Penney,
McDonald's, Merrill Lynch, Sara Lee, and Verizon all announcing new
layoffs.
Barring a sustained rise in oil prices, however, the cuts appear likely
to taper off in the coming months as the economy continues its slow
recovery, most forecasters say. The
bigger problem seems to be companies' unwillingness to hire new workers.
In December, the number of
help-wanted advertisements in newspapers across the country fell to the
lowest level in almost 40 years, according to the Conference
Board, a research group in New York. "There isn't the confidence level in business today that we need for growth," said Cinda Hallman, chief executive of the Spherion Corporation, a staffing company based in Fort Lauderdale, Fla., that places almost 400,000 people in jobs, down from 600,000 three years ago. "There's uncertainty. Companies are being much more cautious than they used to be." BACK TO EDITORIAL TABLE OF CONTENTS
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