Wednesday, March 11, 2009

Data Confirm a "D" is here as the IMF Regrets Admitting It and as Those Who Caused It Blame Anyone But Themselves

About a month ago, the head of the International Monetary Fund, Monsieur Dominique Strauss-Kahn, called the current global economy a Depression for the industrialized world.  He is now being quoted using the euphemism, "Great Recession".  Boy, isn't that reassuring!

No matter, the data speaks for itself.  Yesterday, the Gov't reported that wholesale sales for the United States were down 15.4% for January 2009 vs. Jan. 2008.  As this data is unadjusted for inflation, which was certainly active in the first half of last year, then in the real world, the drop was larger.  17-18%, anyone?  This is a multi-trillion dollar number each year, not some small segment of the economy.  And this number excludes housing sales volume, which has fallen more.

Today come even worse numbers from Treasury:

From Rex Nutting at MarketWatch, courtesy of Calculated Risk:  Budget deficit widens 10% as receipts fall to 14-year low:

U.S. federal government budget widened to $192.8 billion in February ... the second largest monthly deficit on record ... receipts dropped 17% to $87.3 billion, the lowest since February 1995.

In February, individual income taxes fell 64% to just $8.7 billion. That's the lowest monthly total for individual income taxes since May 1985.
As CR commented, "ouch"!

Meanwhile, Jesse's Cafe Americain comments on the principals in our sad saga ungracefully pointing fingers at everyone or someone else, in "Mr. Pot Calling Mr. Kettle.  Mr. Pot Calling Mr. Kettle.":

Steve Schwarzman of the Blackstone group blames the Ratings Agencies for the crisis and the historic 'loss of wealth' throughout the world.

Real wealth has substance. It is created by savings and hard work, and is only destroyed by real world events like natural disasters and wars, and of course theft. . .

The destruction of the real wealth was in the bubble when the middle class was systematically destroyed. This is just the settling of accounts. What we are seeing now is the paint peeling off the rotten economy which the financiers created for their personal benefit. . .

Jamie Dimon is on the financial news networks today speaking to the US Chamber of Commerce, weaving a revisionist view of what happened, blaming everyone but the banks in an amazing display of calculated spin.

Haven't these guys heard that President Obama has proclaimed a new era of personal responsibility?  

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