Howard Davidowitz: Consumers In TERRIBLE Shape and “It’s Going to Get Worse”
6 minute video - email readers will need to come to site to view
Weak data on November retail sales and an earnings miss from Best Buy on Tuesday poured ice-cold water on the whole "strong holiday shopping season" meme.
All the upbeat commentary about Black Friday, Cyber Monday and the like was always specious, according to Howard Davidowitz, CEO of Davidowitz and Associates. Like Barry Ritholtz, Davidowitz says Black Friday data, particularly, can't be trusted and is annually hyped by the retail industry to encourage consumers to get out and spend.
In his own inimitable style, Davidowitz explains why the consumer is in "terrible shape" and why "it's going to get worse," citing the following:
- Crushing Debt Load: Consumer debt is 117% of disposable income.
- Help Not Wanted: Even November's "strong" report included more people dropping out of the labor pool (315,000) vs. those who found work (278,000), according to the Labor Department's household survey.
- Reverse Wealth Effect: Household net worth fell 4% in the third quarter, a drop of $2.4 trillion, according to the Fed. That's the biggest drop since 2008 and would be hard to overcome even if wages were rising sharply, which they're most certainly not.
- Housing Bust Rolls On: Residential housing remains depressed, which is putting tremendous pressure on Americans' net worth and sense of financial confidence. Davidowitz, among others, sees more downside for housing prices and another increase in foreclosures in 2012.
Longtime viewers will note "it's going to get worse" is a familiar refrain for Davidowitz, going back to at least 2009. In the accompanying video, I asked what it would take for him to feel like things are getting better. As he's wont to do with most subjects, Davidowitz answered that question with a stinging critique of President Obama.
Barring a Supreme Court ruling that Obamacare is unconstitutional and/or victory in November by any "sensible" Republican -- Davidowitz thinks both Mitt Romney and Newt Gingrich qualify -- there isn't much about 2012 he's looking forward to, as you'll see in the accompanying video.
Ok this one below might have some more of the 'hyperbole' angle to it ;)
HOWARD DAVIDOWITZ: Ben Bernanke Will Go Down In History As The Fed Chairman Who Destroyed The Country
4 minute video - email readers will need to come to site to view
Frequent DailyTicker guest Howard Davidowitz of Davidowitz & Associates has no doubt about what Ben Bernanke's legacy will be. Ben Bernanke, says Davidowitz, will forever be known as the Fed Chairman who destroyed the dollar, bailed out the banks, and perpetuated a monetary Ponzi scheme that will ultimately end in collapse.
But wait. Didn't Ben Bernanke save the country from a second Great Depression? Absolutely not, says Davidowitz.
Far from saving the country, Bernanke and his fellow White House confederates President Obama and Treasury Secretary Tim Geithner did everything they could to avoid fixing the problem. They bailed out the banks, and as a result, the banks have not been fixed. They pumped money into the economy and postponed the inevitable day of reckoning. They heaped additional regulation atop an already crushing regulatory burden. And in so doing, they helped ruin the country.
THAT will be Bernanke's legacy, insists Davidowitz. Not his creative use of a multiplicity of techniques to avoid bank failures and keep liquidity flowing through the American and European economies. Bernanke's mission in life, says Davidowitz, is to destroy the dollar. Eventually he will be successful. And this contribution to American history will never be forgotten.