We heard news yesterday that pending home sales for November dropped by 16%.  This data is always reported with a two month lag time.  Here’s the graph:



What’s important to notice with this graph is that last October was the timeframe when the “First Time Homebuyers” tax credit was set to expire.  People were rushing to buy new homes prior to that, and then the buying interest fell off of a cliff.

The Federal government ended up extending the credit into later this year (promising your hard earned dollars to give to other people for free).

All of the immoral activities aside, there is a very important learning point here.  The Federal government is trying to spend as much new money as possible (get into new debt) in an effort to combat the credit destruction that the international bankers are purposefully causing.  They’re extending tax credits to people, with the purpose of having others join them in new debt creation by purchasing homes.

The Federal government ended up “pulling-forward” demand for homes.  People that were thinking of holding off on their purchase rushed forward so that they could participate in stealing future taxpayer dollars.

The above graph shows a major problem in our nation.  It’s the “me” generation.  People are striving to take advantage of “free” money – while failing to realize that the “free” money actually consists of putting others further into bondage to our government.

The REALLY shameful thing is that none of this will work.  The government can’t spend its way out of a recession any better than an individual can spend their way out of credit card debt.  All that occurs is a prolonging of the pain – and a deepening of the pain once it arrives.

The “experts” were predicting a drop of 2% for November.  The most pessimistic “expert” said that we’d see a drop of 12%.   What does this tell us?

Our economic “recovery” that we’re experiencing is not really a recover whatsoever.  It is being driven entirely by the Federal government spending massive amounts of claims on our future labor (otherwise known as money).

Our greedy citizens keeps assisting the bankers by taking out new loans that increase our money supply and drive the inflation that everybody complains about.  Our greedy citizens run fervently to the “master” government whenever they smell a “free” handout via a rebate and/or tax credit.

Our greedy citizens are playing right into the power structure of the international bankers and our government, and it will be to our greedy citizens peril.

Meanwhile, we need a different economy that can at least run parallel to our current mess and operate on biblically-based principles.  We may not be able to fully partake of this economy of liberty and freedom 100%, but it would be sufficient to teach us what the sweet taste of laboring to God’s glory is truly about.

"Is life so dear or peace so sweet as to be purchased at the price of chains and slavery? Forbid it, Almighty God. I know not what course others may take, but as for me, give me liberty or give me death!" -- Patrick Henry

"Our own Country's Honor, all call upon us for a vigorous and manly exertion, and if we now shamefully fail, we shall become infamous to the whole world. Let us therefore rely upon the goodness of the Cause, and the aid of the supreme Being, in whose hands Victory is, to animate and encourage us to great and noble Actions -- The Eyes of all our Countrymen are now upon us, and we shall have their blessings, and praises, if happily we are the instruments of saving them from the Tyranny mediated against them. Let us therefore animate and encourage each other, and show the whole world, that a free man contending for Liberty on his own ground is superior to any slavish mercenary on earth." -- George Washington, 1776
________________________________________________________

Watch for these indexes to drop:

Chinese Shanghai Composite Index: 3,262.79 (change of 0.13% from July 20, 2009 base value of 3,266.92)
Shenzhen Stock Exchange Component Stock Index (SSE): 13,555.04 (change of 1.30% from July 20, 2009 base value of 13,381.22)
________________________________________________________

Here are today’s numbers for the economic indicator:

1) Gold = $1,138.10
2) Dollar Index = 77.45
3) Oil = $83.18
4) S&P 500 Index = 1,137.14
5) 3-month Treasury Bill yield = 0.05
6) 3-month OIS = 0.14

HEI = 30.95

(A value of under 100 indicates deflation, while over 100 indicates inflation – as referenced to Sept. 12, 2008…the day before Lehman Brothers collapsed)



__________________________________________________________

Here are the numbers for the day:

Dollar Index adjusted indexes:
Dow = (10,573.68) x (0.7745) = 8,189.32
S&P 500 = (1,137.14) x (0. 7745) = 880.71
Nasdaq = (2,301.09) x (0.7745) = 1,782.19

3-month Treasury: 0.05

2-year Treasury: 1.02

10-year Treasury: 3.84

30-year Treasury: 4.70

2-yr vs. 10-yr Spread (Target > 273): 282 basis points – (Danger Zone)

2-yr vs. 30-yr Spread (Target > 369): 368 basis points

3-month LIBOR: 0.25

3-month EURIBOR: 0.69

3-month OIS: 0.14

TED Spread: 20 basis points

LIBOR/OIS Spread: 11 basis points

Dollar Index: 77.45

Volatility Index: 19.16

JPY-EUR Exchange Rate (Target < 115): 133.2079

JPY-GBP Exchange Rate (Target < 145): 148.0365

JPY-USD Exchange Rate (Target < 90): 92.39

USD-EUR Exchange Rate (Target < 1.25): 1.4418

USD-CNY Exchange Rate (Target > 7.0): 6.8274

Warmly,

Brad

Comments or questions?  brhamill@hamill.com