This is a first: Tonite at 6:30, I am appearing on PBS’ Nightly Business Report with Paul Kangas and Susie Gharib.
Tonites subject is the impact of slowing housing on the economy. For a refresher, see Real Estate and the Post-Crash Economy from earlier this year.
We will discuss sectors to avoid: Electronics Retailers, Durable Goods makers, Mortgage Underwriters, and the Sub-prime mortgage lenders.
With new Mortgages and refis down — and revolving credit use up — the credit card companies have become much more attractive. Also well positoned are the big caps and exporters who can take advantage of the week dollar.
Streaming video (eventually) can be found here.
Watch PBS tonight – interviews are always short on there. Im in the same camp about housing – thinking the worst is still yet to come.
My thoughts on Boeing because I have thought about some long term puts out to 09. The stock is priced to perfection. The 787 Dreamliner is almost sure not to come on line on time with test flights this summer. The plane is too complictated and the parts are made all over the globe. The schedule is too tight and there have been some articles about a few problems.
About 3/4 of there future sales are non military.
Bullish
1. Oil is a little cheaper for now.
2. Weak dollar.
3. DOD spending is out of control.
4. Foreign airlines growing.
Bearish
1. Economic slowdown is probably going to happen ie. bad for air travel.
2. 787 is very complicated and getting a new plane out anywhere near on time is uncertain. Look at the A380 and the pounding Airbus took.
3. Lot of airlines bankrupt or near it and any slowdown is going to cream them – See 1
4. Terrorism with anything doing with oil supply or airplanes.
1.Commodities,mortgage and durables are the leading sectors of recession and financial troubles down the road.
2.We are at the “comfort” stage of the current expansion as above average job growth returned in late 05 to the economy and wages are starting to be pressed higher while non-Iraq unemployment is probably close to 5.0%.
3.Due to the increasing job growth and consumption, the equities are rallying which is no surprise at this stage of the expansion. With no recession in the next 3-6 months, they will feel peacefull.
The key is how long it can go and how deep it gets before the next recession sets in. With Commodities beginning to crash, that will trigger higher consumption and growth but also potentially dampen growth excessively as the Real Estate bust matures and financial risk becomes excessive. 2007 will be the year which this expansion decides whether it lasts to 2009-10 or is in a recession a year from now.
Oh nooo… that was an imposter.
Yep… that was one of those human-pod-body-snatchin’ hatch-outs:
http://www.imdb.com/title/tt0049366/
Mrs. Big Pic’d better search around the grounds of the Picmansion for any more and spray ’em before they pupate:
http://en.wikipedia.org/wiki/Pupa
Barry I rarely watch NBR anymore but glad I stumbled on your piece tonight, good-looking tie and seriously have you been in the weight-room look like you shed 20 and got cut-up good-show…..
Nice to see you kept it very simple especially noting what the “brass” had to say in Barrons last weekend. With the implications for an oversold crude chart the notion of calling a seasonal bottom (assuming the carry-trade stays-on ofcourse)probably would have been too controversial for Paul’s audience.
I like how Paul egged you on.
“Very interesting, let’s have a few more of those that will benefit.”
Nice job! Poised and authoritative :)
Barry, My wife says you must be a Prince fan :)
~~~
BR:
I was shocked when I got home and saw the video — I was wearing a dark olive suit, nearly gray in appearance. On their video, it turned bright green!
(The tie, on the other hand, was purple)
Great presentation, Mr. Ritholtz – especially given the short time window.
It was enjoyable seeing my favorite MSM financial journalist interview my favorite non-MSM financial blogger. Thanks for plugging GE (a holding of mine) as well.
lol that wasn’t barry on there? my lord here’s a guy who says he’s a bear and he recommends 5 fat dow stocks each up 30-40%. barry if you’re truely a bear you’ll know the dow must collapse to take the whole market down . barry do you believe the dow falls 10% in 2007?
Bull or Bear? Neither!
http://www.thestreet.com/_rms/comment/barryritholtz/10219637.html
Borrowing
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