We continue to be told that things are getting better on many fronts but Wall Street Baffled by Slowing Economy, Low Yields. There is "almost near panic going on with money managers and people who are responsible for money." They are at a loss to "find real yield and real returns on these assets."
The housing sector continues to be bad news upon bad news as results fall well short of expectations:
- US house price fall 'beats Great Depression slide'
- Horror for US Economy as Data Falls off Cliff - CNBC
- U.S. Home Values to Drop by $1.7 Trillion This Year, $9 Trillion since 2006
The government having not learned from the first quantitative easing, set sail with QE II. That having not worked QE III is not being bandied about.
Prepare for More Money Printing: Analyst - CNBC: "Investors should prepare themselves for a third round of quantitative easing, Simon Maughn, co-head of European equities at MF Global, told CNBC Wednesday.
“The bond market is going in one direction which is up-falling yields which is telling you quite clearly the direction of economic travel is downwards. Downgrades. QE3 (a third round of quantitative easing) is coming,” said Maughn. “The bond markets are all smarter than us, and that’s exactly what the bond markets are telling me.”"
“The bond market is going in one direction which is up-falling yields which is telling you quite clearly the direction of economic travel is downwards. Downgrades. QE3 (a third round of quantitative easing) is coming,” said Maughn. “The bond markets are all smarter than us, and that’s exactly what the bond markets are telling me.”"
“What’s interesting in the bond markets over the last couple of sessions is, you’ve seen human traders trying to step in and call this turn in the market the same way that equities have done … and they have just been mowed down by the quant funds which are all about leverage, all about momentum and are betting on bond prices going up,” added Maughn.
"Once again, the United States will step up as the marginal buyer of bonds, said Maughn."
"One more big injection of cash into the bond market should take you through at least the summer season into the beginning of the fourth quarter.”
“That cash injection will have the normal inflationary knock-on impact, driving back up commodities, supporting industrial stocks, dragging the financials up with them… I think it’s all about the monetary injection trade,” Maughn told CNBC.
Now it's citizen's are losing any confidence they may have had.
"Americans are growing increasingly doubtful about direction of the US economy, according to the latest survey from business-advisory firm AlixPartners.
"In fact, an increasing number, some 61 percent, say they don't expect to return to their respective pre-recession lifestyles until the spring of 2014, if ever.
"What's worse, a full 10 percent said they expect they will never return to pre-recession spending.
"That's a more pessimistic view than last year, when those surveyed expected that they could be back to pre-recession spending levels by the middle of 2013.
'Americans continue to push their expectations for return to a pre-recession 'normal' further and further into the future—close enough for comfort, but far enough away to seem realistic,' said Fred Crawford, CEO of AlixPartners. 'But as that happens, more and more it seems normal is actually where we are right now.'"
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