In other news Alcoa is about to cut 13,500 jobs. Not sure how the economy can recover if companies continue to delever their labor force expense which ultimately puts a squeeze on personal income statements and forces the consumer to delever. And once they stop spending it causes a domino effect of job cuts. Hurry up Obama!
"Alcoa, the largest U.S. aluminum maker, said Tuesday that it would cut 13,500 jobs, or about 13 percent of its global work force, and reduce spending and output because of the economic downturn. The company, based in Pittsburgh, said that in addition to the job cuts, 1,700 contractors also would be eliminated and that it was implementing a global salary and hiring freeze." International Herald TribuneOn the housing front, star homebuilding analyst Ivy Zelman said on CNBC this morning to sell this homebuilding rally. She thinks job losses will not allow the market to deal with the oversupply of distressed inventory fast enough and that homebuilders are rallying strictly on Obama stimulus anticipation. She's bearish because delinquencies continue to rise and a "tsunami" of foreclosures are expected to show up on the market during the next several years. She thinks loan modifications will fall short and mortgage nationalization would be the only cure because there's too much negative housing equity on the market. The video below takes you to CNBC.com.
Has the market already priced in this madness? Can Obama create enough jobs to soak up all of this housing inventory? Place your bets.
