Economics Update

Real estate is still trending worse. We have the New York Times writing about how the troubles have gone global.^*

We also are now seeing discounts up to 60% on the last sale price in bank auctions on properties in South Florida.

And it won't get better soon, because when pollsters ask about buying a home, respondents reply, "What??? buy a house now??? Are you out of your bloody mind???".

Energy prices are surging, with oil closing at a new all time high, $111.76/bbl.

Also, it looks like Wachovia is hemorrhaging, and so is cutting dividends and planning to offer stock for much needed capital.


^*As an aside, I'm not surprised that Ireland is in this select group. The "Celtic Tiger" has always seemed to me to be closer to Thailand and Indonesia than the rest of the EU with its prosperity being almost completely driven by low wages and real estate, and Spain is a close second on this. This is not to say that they will become 3rd world countries, but that they both may end up far closer to EU members like Poland, Slovakia, Hungary, and Croatia than they had previously imagined.^†
†Mass flows of speculative capital always produce a nasty hangover.