Wednesday, June 24, 2009

Philadelphia Freedom

"At the moment he could not see clearly enough ahead to know one way or the other. Something to save us, he thought; something to doom us. It-the equation of everything-could go either way."

Philip K. Dick, A Maze of Death

Sorry for the prolonged absence, just got back from a much needed mini-vacation to the City of Brotherly Love where my brothers and in-laws live. A quick trip to Atlantic City revealed the slowly dying carcass of a town that will lose doubly bad as it ramped up at the worst time in an effort to compete with Vegas. Soon to be passed (slots are already in place in Philly) legislation in both Pennsylvania and Delaware legalizing gambling is going to spell continued doom for AC. Free room comps during the week are common and even the Borgata (that buffet was good!) is offering $99 rooms during the summer. I entered my first Hold Em' tournament with my older brother and we both did reasonably well, finishing in the top 25 out of 104 players.

The quote above from Dick kind of sums up where we are. Treading in much murkier water than the government would have you believe, the markets are kind of floundering. Despite a 200-point plunge on Monday, the market is shooting up today even though continuing jobless claims are a grim reminder of how bad the real economy is (Sorry, Markman, have no idea why you thought they'd decrease by 40K and if the June number comes in at only 275K losses, than you must actually be working for the government).

Moody's says credit card charge-offs are now officially over 10%. In case you haven't seen the news lately, California is bankrupt. And I can't imagine that they're the only state bleeding money (I know Florida is, we have no revenue, no tourism, and no construction). It should be interesting to see what the government is forced to do when California is unable to cut spending any further...... says 30-year mortgages are now up to 5.8%. New home sales slipped and shockingly, builders like Lennar continue to lose money. But don't take my word for it. "While there are buyers in the market, they lack confidence, and they're worried about their own jobs and the economy in general," said Douglas Yearley, regional president at luxury builder Toll Brothers Inc. "We're also in a vicious cycle when it comes to capital," Yearley said. "Banks have tightened their lending standards, which is limiting the number of buyers that are eligible for financing. This decreases the demand for homes, which causes home prices to further plummet."


Anonymous said...

People are starting to see through the charade... no quick recovery... no easy credit... less disposable income...

While people like us can appreciate games of chance, as a rule of thumb, no nation ever gambled its way to success... Call me a moralist... but also call me right!!!


AX said...

Something eerie about the market this week, hope it was one last push for quarter close and then the collapse can begin.

Asian nations are much bigger on legalized gambling than we are, it's a much bigger part of accepted culture.