Lehman Brothers filed for bankruptcy. And the venerable Merrill Lynch was taken over by Bank of America.Bank of America? What a joke! That’s just another house of cards that could come crashing down at any moment. After all, these are truly desperate times. Analysts now admit that subprime losses will eventually total up to $1 TRILLION —and not even half that amount has been written off so far.
Frankly, this could be the end of the banking system as we know it. But it’s not just the financial sector that’s weighing on the stock market. The entire U.S. economy is riddled with risk. The retail sales numbers for August just came out. They fooled all the experts, who were looking for a 0.3% gain. They fell 0.3%, instead. What’s more, the July numbers were adjusted to a miserable minus 0.5%.
I won’t bore you with all the charts and graphs. But PLEASE, do take a moment to look at this one. Your wealth depends on it. It shows a rapidly-increasing percentage of companies are hitting the skids, in regards to sales. And if sales are dropping...earnings will follow them down...and so will stock prices.
That’s not a pretty picture.
What’s more, latest research shows:
- Companies can’t borrow money. The credit crunch is turning into a death grip.
- Companies are slashing capital spending to the bone.
- Companies aren’t hiring. Good luck if you expect the American consumer to turn this ship around. No jobs. No equity in their homes. Maxed out on credit cards. Forget about any soft landing to this CRASH.
1 comment:
With the recession in the global economy, fallout of the Wall Street's most respected financial giants, and a slump in the IT market, we don't really know how the credit industry is going to recover. Do you know India was (will use past tense here coz' the future is badly shaken now) poised for a 40 billion dollar FDI? Mr. Kamal Nath might try pacifying us saying that economic turmoil Asia-wide is less dependent on the U.S. market but we all know how our banks work...squeezing every paisa out of the customer. Already we are facing an exponential threat with the double-digit inflation!
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