MWF (Wednesday) Briefing:
Demand destruction for oil is having an impact on consumers and across industries, though this doesn't mean cost of oil will actually diminish long term considering the world is still functioning under the oil consumption growth paradigm, developing countries' oil needs long term, and Peak Oil.
The DOA is projecting that corn is tracking to have the second highest yield on record at 12.3 billion bushels. This is a big bounce back from torrential rains that wiped out early crops. Fundamental strength in commodities should continue albeit short term volatility with recent sucker rallies in stock markets only pre-saging testing lower lows before recovery. Also, the housing data - prime loans are on track to dwarf the sub-prime debacle once they start to reset. There's a long way to go.
"Global economic activity continues to expand, but at a slower pace.Sluggish growth in the advanced economies is expected to continue at least until the first half of 2009. The rapid growth in the emerging markets is likely to soften." Dallas Fed
- Retail data is worse than expected. Forbes
- Protected financial stocks (SEC's emergency restriction on short sales) rose 26%. Dealbreaker
15,108 homes offered on Countrywide Financial's website. Total REO asking price is $2,707,749,339 (8/11/08). In California, the average ask price has dropped nearly 40% with REO dropping to $250,000 from $400,000. Countrywide-Foreclosures Economist's View
- Consumer driven commodity bull market. Financial Sense
- Corn slated for bumper crop. NYT
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