Bulls, Bears & Bucks #49: 50.000 banen weg bij Citigroup

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Op woensdag 12 november 2008 22:16 schreef LXIV het volgende:

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Wanneer GM valt zal de staat al die pensioenen moeten ophoesten. Plus al die andere uitkeringen die ontstaan. Dat kan meer kosten dan het overeind houden van GM.

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Op donderdag 13 november 2008 02:10 schreef Dinosaur_Sr het volgende:

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welkom in USA. Als GM failliet gaat, staat het personeel met lege handen. Dit is Nederland niet.

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Op donderdag 13 november 2008 02:10 schreef Dinosaur_Sr het volgende:

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welkom in USA. Als GM failliet gaat, staat het personeel met lege handen. Dit is Nederland niet.

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Op woensdag 12 november 2008 21:52 schreef pberends het volgende:

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http://www.tijd.be/nieuws(...)lson.8102855-442.art

Grappig. Dus als Paulson met een nieuwe oplossing hiervoor komt gaan de beurzen weer sky-rocketing?

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Op donderdag 13 november 2008 10:25 schreef MoltiSanti het volgende:

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wat is het voordeel van bank worden?

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Op woensdag 12 november 2008 21:10 schreef Basp1 het volgende:

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Ik denk dat we onze overheid maar moeten overtuigen dat we voordat het grote banen verlies in nederland begint alvast fokker maar weer nieuw leven moeten gaan in blazen en met een flinke zak overheidsgeld.

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First-time claims for U.S. unemployment insurance rose last week to the highest level since September 2001, when the economy was last in a recession, as weakening demand led companies to fire more workers.

Initial jobless claims increased by 32,000 to a larger- than-forecast 516,000 in the week ended Nov. 8, from a revised 484,000 the prior week, the Labor Department said today in Washington. The total number of people on benefit rolls jumped to the highest level since 1983.

Restrictive credit and slumping demand are causing companies to retrench by trimming payrolls and investment. Rising joblessness will further squeeze consumer spending, which accounts for more than two-thirds of the economy, and threaten a protracted downturn, economists said.

``The labor market is only reinforcing a very pessimistic picture,'' Linda Barrington, a labor economist at the Conference Board, said in a Bloomberg Television interview. ``When you start to see the downward pressure on wages as well as the credit crunch, that's only going to make consumers much more nervous.''

Trade Deficit Narrows

Another government report showed the U.S. trade deficit narrowed more than forecast in September as a record decline in the cost of foreign crude oil caused fuel imports to tumble. The gap shrank 4.4 percent to $56.5 billion, the smallest in almost a year, from $59.1 billion in August, the Commerce Department said today in Washington. Excluding petroleum, the deficit widened as overseas sales of American-made goods dropped by the most since 2001.

Economists surveyed by Bloomberg had anticipated a reading of 480,000, based on the median of 40 projections in a Bloomberg News survey, from the originally reported 481,000 in the prior week. Estimates ranged from 465,000 to 500,000 initial claims.

The total number of Americans receiving jobless benefits rose to 3.897 million in the week ended Nov. 1, the highest level since January 1983.

The four-week moving average of initial claims, a less volatile measure, rose to 491,000 last week, the highest since March 1991, from 477,750 a week earlier. So far this year, weekly claims have averaged 400,600, compared with an average of 321,000 for all of 2007, when the economy added a total of 1.1 million jobs.

The unemployment rate among people eligible for benefits, which tends to track the jobless rate, held at 2.9 percent. These data are reported with a one-week lag.

Thirty-six states and territories reported an increase in new claims, while 17 reported a decrease.

Unemployment Rate

The labor market is weakening as the economy appears to be in its first downturn since 2001. The jobless rate rose to 6.5 percent in October, the highest since 1994, the government said last week.

Employers cut 240,000 jobs last month, for a total so far this year of 1.2 million jobs lost, while the total number of unemployed Americans jumped to 10.1 million, the highest level in a quarter century, according to last week's jobs report from the Labor Department.

Job Cuts

The monthly non-farm payrolls numbers reflect job growth and they tend to fall as the weekly initial jobless claims figures, which reflect firings, rise.

Companies are trimming staff as consumer spending is forecast to fall through at least March, according to economists surveyed by Bloomberg early this month. Banks, faced with mounting losses and writeoffs as the financial crisis spread over the past year, have been sacking thousands of workers.

Citigroup Inc. and Goldman Sachs Group Inc., faced with a weakening economy and the prospect of mounting losses, began firing workers as part of the firms' plans to cut more than 12,000 jobs, people with knowledge of the matter said last week.

Goldman, which converted last month from the biggest U.S. securities firm into a commercial bank, on Nov. 5 began telling about 3,200 employees, or 10 percent of its workforce, they were out of a job, according to one of the people who declined to be identified because the decisions were confidential.

Citigroup began notifying staff last week who are affected by the bank's plan to discard 9,100 positions over the next 12 months, or about 2.6 percent of its headcount, another person said.

Both New York-based firms have already cut staff, and are among the banks and brokerages worldwide that have shed almost 150,000 jobs since the subprime mortgage market collapsed last year.

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The Worst Is Not Behind Us
Nouriel Roubini 11.13.08, 12:01 AM ET

It is useful, at this juncture, to stand back and survey the economic landscape--both as it is now, and as it has been in recent months. So here is a summary of many of the points that I have made for the last few months on the outlook for the U.S. and global economy, as well as for financial markets:

--The U.S. will experience its most severe recession since World War II, much worse and longer and deeper than even the 1974-1975 and 1980-1982 recessions. The recession will continue until at least the end of 2009 for a cumulative gross domestic product drop of over 4%; the unemployment rate will likely reach 9%. The U.S. consumer is shopped-out, saving less and debt-burdened: This will be the worst consumer recession in decades.

--The prospect of a short and shallow six- to eight-month V-shaped recession is out of the window; a U-shaped 18- to 24-month recession is now a certainty, and the probability of a worse, multi-year L-shaped recession (as in Japan in the 1990s) is still small but rising. Even if the economy were to exit a recession by the end of 2009, the recovery could be so weak because of the impairment of the financial system and the credit mechanism that it may feel like a recession even if the economy is technically out of the recession.

--Obama will inherit an economic and financial mess worse than anything the U.S. has faced in decades: the most severe recession in 50 years; the worst financial and banking crisis since the Great Depression; a ballooning fiscal deficit that may be as high as a trillion dollars in 2009 and 2010; a huge current account deficit; a financial system that is in a severe crisis and where deleveraging is still occurring at a very rapid pace, thus causing a worsening of the credit crunch; a household sector where millions of households are insolvent, into negative equity territory and on the verge of losing their homes; a serious risk of deflation as the slack in goods, labor and commodity markets becomes deeper; the risk that we will end in a deflationary liquidity trap as the Fed is fast approaching the zero-bound constraint for the Fed funds rate; the risk of a severe debt deflation as the real value of nominal liabilities will rise, given price deflation, while the value of financial assets is still plunging.

--The world economy will experience a severe recession: Output will sharply contract in the Eurozone, the U.K. and the rest of Europe, as well as in Canada, Japan and Australia/New Zealand. There is also a risk of a hard landing in emerging market economies. Expect global growth--at market prices--to be close to zero in Q3 and negative by Q4. Leaving aside the effects of the fiscal stimulus, China could face a hard landing growth rate of 6% in 2009. The global recession will continue through most of 2009.

--The advanced economies will face stag-deflation (stagnation/recession and deflation) rather than stagflation, as the slack in goods, labor and commodity markets will lead advanced economies' inflation rates to become below 1% by 2009.

--Expect a few advanced economies (certainly the U.S. and Japan and possibly others) to reach the zero-bound constraint for policy rates by early 2009. With deflation on the horizon, zero-bound on interest rates implies the risk of a liquidity trap where money and bonds become perfectly substitutable, where real interest rates become high and rising, thus further pushing down aggregate demand, and where money market fund returns cannot even cover their management costs.

Deflation also implies a debt deflation where the real value of nominal debts is rising, thus increasing the real burden of such debts. Monetary policy easing will become more aggressive in other advanced economies even if the European Central Bank cuts too little too late. But monetary policy easing will be scarcely effective, as it will be pushing on a string, given the glut of global aggregate supply relative to demand--and given a very severe credit crunch.

--For 2009, the consensus estimates for earnings are delusional: Current consensus estimates are that S&P 500 earnings per share (EPS) will be $90 in 2009, up 15% from 2008. Such estimates are outright silly. If EPS falls--as is most likely--to a level of $60, then with a price-to-earnings (P/E) ratio of 12, the S&P 500 index could fall to 720 (i.e. about 20% below current levels).

If the P/E falls to 10--as is possible in a severe recession--the S&P could be down to 600, or 35% below current levels.

And in a very severe recession, one cannot exclude that EPS could fall as low as $50 in 2009, dragging the S&P 500 index to as low as 500. So, even based on fundamentals and valuations, there are significant downside risks to U.S. equities (20% to 40%).

Similar arguments can be made for global equities: A severe global recession implies further downside risks to global equities in the order of 20% to 30%.Thus, the recent rally in U.S. and global equities was only a bear-market sucker's rally that is already fizzling out--buried under a mountain of worse-than-expected macro, earnings and financial news.

--Credit losses will be well above $1 trillion and closer to $2 trillion, as such losses will spread from subprime to near-prime and prime mortgages and home equity loans (and the related securitized products); to commercial real estate, to credit cards, auto loans and student loans; to leveraged loans and LBOs, to muni bonds, corporate bonds, industrial and commercial loans and credit default swaps. These credit losses will lead to a severe credit crunch, absent a rapid and aggressive recapitalization of financial institutions.

--Almost all of the $700 billion in the TARP program will be used to recapitalize U.S. financial institutions (banks, broker dealers, insurance companies, finance companies) as rising credit losses (close to $2 trillion) will imply that the initial $250 billion allocated to recap these institutions will not be enough. Sooner rather than later, a TARP-2 will become necessary, as the recapitalization needs of U.S. financial institutions will likely be well above $1 trillion.

--Current spreads on speculative-grade bonds may widen further as a tsunami of defaults will hit the corporate sector; investment-grade bond spreads have widened excessively relative to financial fundamentals, but further spread-widening is possible, driven by market dynamics, deleveraging and the fact that many AAA-rated firms (say, GE) are not really AAA, and should be downgraded by the rating agencies.

--Expect a U.S. fiscal deficit of almost $1 trillion in 2009 and 2010. The outlook for the U.S. current account deficit is mixed: The recession, a rise in private savings and a fall in investment, and a further fall in commodity prices will tend to shrink it, but a stronger dollar, global demand weakness and a larger U.S. fiscal deficit will tend to worsen it. On net, we will observe still-large U.S. twin fiscal and current account deficits--and less willingness and ability in the rest of the world to finance it unless the interest rate on such debt rises.

--In this economic and financial environment, it is wise to stay away from most risky assets for the next 12 months: There are downside risks to U.S. and global equities; credit spreads--especially for the speculative grade--may widen further; commodity prices will fall another 20% from current levels; gold will also fall as deflation sets in; the U.S. dollar may weaken further in the next six to 12 months as the factors behind the recent rally weather off, while medium-term bearish fundamentals for the dollar set in again; government bond yields in the U.S. and advanced economies may fall further as recession and deflation emerge but, over time, the surge in fiscal deficits in the U.S. and globally will reduce the supply of global savings and lead to higher long-term interest rates unless the fall in global real investment outpaces the fall in global savings.

Expect further downside risks to emerging-markets assets (in particular, equities and local and foreign currency debt), especially in economies with significant macro, policy and financial vulnerabilities. Cash and cash-like instruments (short-term dated government bonds and inflation-indexed bonds that do well both in inflation and deflation times) will dominate most risky assets.

So, serious risks and vulnerabilities remain, and the downside risks to financial markets (worse than expected macro news, earnings news and developments in systemically important parts of the global financial system) will, over the next few months, overshadow the positive news (G-7 policies to avoid a systemic meltdown, and other policies that--in due time--may reduce interbank spreads and credit spreads).

Beware, therefore, of those who tell you that we have reached a bottom for risky financial assets. The same optimists told you that we reached a bottom and the worst was behind us after the rescue of the creditors of Bear Stearns in March; after the announcement of the possible bailout of Fannie and Freddie in July; after the actual bailout of Fannie and Freddie in September; after the bailout of AIG in mid-September; after the TARP legislation was presented; and after the latest G-7 and E.U. action.

In each case, the optimists argued that the latest crisis and rescue policy response was the cathartic event that signaled the bottom of the crisis and the recovery of markets. They were wrong literally at least six times in a row as the crisis--as I have consistently predicted over the last year--became worse and worse. So enough of the excessive optimism that has been proved wrong at least six times in the last eight months alone.

A reality check is needed to assess risks--and to take appropriate action. And reality tells us that we barely avoided, only a week ago, a total systemic financial meltdown; that the policy actions are now finally more aggressive and systematic, and more appropriate; that it will take a long while for interbank and credit markets to mend; that further important policy actions are needed to avoid the meltdown and an even more severe recession; that central banks, instead of being the lenders of last resort, will be, for now, the lenders of first and only resort; that even if we avoid a meltdown, we will experience a severe U.S., advanced economy and, most likely, global recession, the worst in decades; that we are in the middle of a severe global financial and banking crisis, the worst since the Great Depression; and that the flow of macro, earnings and financial news will significantly surprise (as during the last few weeks) on the downside with significant further risks to financial markets.

I'll stop now.


Nouriel Roubini, a professor at the Stern Business School at New York University and chairman of Roubini Global Economics

quote:

Op donderdag 13 november 2008 02:10 schreef Dinosaur_Sr het volgende:

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welkom in USA. Als GM failliet gaat, staat het personeel met lege handen. Dit is Nederland niet.

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Op vrijdag 14 november 2008 09:17 schreef rvlaak_werk het volgende:
Willem van Middelkoop noemt de rally van gisteren verdacht. Hij beweerd zelfs dat de PPT heeft ingegrepen. Nieuwsuitzending RTLZ, 9:00

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Op vrijdag 14 november 2008 09:37 schreef jpjedi het volgende:
Echt he..die Yanks zitten de kluit te belazeren daar, wil je niet weten. Zelfde verhaal als met die stemming van het huis over de bailout.

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De Nederlandse economie is in het derde kwartaal niet gegroeid ten opzichte van het tweede kwartaal. "We zitten aan de rand van een recessie."

CBS
Ook in het tweede kwartaal was sprake van nulgroei. Dit maakte het Centraal Bureau voor de Statistiek (CBS) vrijdag bekend. We zitten dus nog niet in een recessie, daarvoor zijn twee kwartalen van krimp nodig. Volgens CBS-econoom Michiel Vergeer verkeert de Nederlandse economie wel "aan de rand van een recessie".

Jaar op jaar
De economie is in het derde kwartaal met 1,8 procent gegroeid ten opzichte van een jaar eerder. De groei is behaald met een werkdag meer dan in het derde kwartaal van 2007. Dit blijkt uit de eerste raming van het CBS.

Bestedingen
De bestedingen van consumenten maar vooral de investeringen namen minder snel toe. Ook de uitvoer van Nederlands product groeit veel langzamer. De groeivertraging deed zich in vrijwel het gehele bedrijfsleven voor.

Werkgelegenheid
Er zijn ruim 110 duizend banen meer dan een jaar geleden. Dit is een stijging van 1,4 procent. Deze stijging is duidelijk minder dan in de afgelopen twee jaar.

Alle cijfers van het CBS over de economische groei (pdf)

Lees ook alles over de haperende econonie is ons dossier De Nederlandse economie