50-50 Chance of Depression

From Bloomberg:

U.S. Has 50% Chance of Depression, Economist Roger Farmer Says 

The U.S. economy has a 50 percent chance of falling into a depression during the next three years, said Roger Farmer, a member of the National Bureau of Economic Research’s economic fluctuations and growth program.

“There’s a significant probability things will get worse,” Farmer, 53, said during a phone interview today. “We’re certainly not at the end of the recession and things are getting worse.”

A drop in the Conference Board’s index of leading indicators, released yesterday, underscores economists’ expectations that the recession will be the longest in the postwar era as banks restrict credit, home and stock values plunge, and job losses mount. Farmer said he is predicting the U.S. recession will last at least another year.

“Everything depends on business confidence, and what I see is declining confidence,” said Farmer, who is also graduate vice-chair of the economics department of the University of California at Los Angeles.

The loss of confidence is leading households and companies to undervalue assets, which in turn is hurting consumer spending and investment, he said. [more]

Humor: Mis-Fortune Teller

Vaporize COMEX 2008-12-26

Gold: 47.9% depleted. Delivery notices today: 11,000 oz.
Silver: 46.3% depleted. Delivery notices today: 415,000 oz.

Link to all Vaporize COMEX posts:

 

COMEX trades hundreds of times more gold & silver than they actually possess. If enough investors demand delivery of PHYSICAL gold & silver COMEX stockpiles will be depleted. If COMEX runs out, the ensuing rush to grab physical metal to settle contract obligations *could* be the spark that ignites the long-awaited precious metals wildfire.

Explanation:
COMEX warehouses contain both “registered” and “eligible” metals. The “registered” metals are available for physical delivery. The “eligible” metals are not ready for delivery until they become “registered.” Although this pool of “eligible” metals is stored at COMEX warehouses there is no obligation to “register” these metals for subsequent physical deliveries.

The graph shows:
1) the cumulative ounces of metal delivery notices this month,
2) the ounces of “registered” metal available for delivery,
The percentage shown is based on the cumulative physical metal delivery notices for the month against the “registered” amount of metal in COMEX.
“Eligible” metal inventories are not shown as they do not have a direct bearing on the inventory depletion ratio.

Sources:
[1] COMEX precious metals warehouse stocks:
gold: http://cmegroup.com/trading/energy-metals/files/Gold_Stocks.xls
silver: http://cmegroup.com/trading/energy-metals/files/Silver_Stocks.xls
[2] COMEX precious metals daily delivery notices: http://cmegroup.com/trading/energy-metals/files/delivery.pdf
Link to master list of reports: http://www.cmegroup.com/trading/energy-metals/nymex-daily-reports.html 

More info:
- Gold: Is This It, NOW?
- Attack of COMEX Gold & Silver
- How 2 Track COMEX Deliveries
- Sinclair Sez “Help Me Bust Comex”
- This Guy Plans 2 Kill “Paper” Silver
- COMEX: Taking Delizery Is EZ