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U.S. Economy

Stocks Have You Worried? Here's What You Do

Last Tuesday, USA Today ran a long Page 1 story under the headline "Invest in Stocks? Forget About It."

The story's message was loud and clear: U.S. stocks have risen more than 100% from their March 2009 bear-market bottom - including 25% since October and 9% so far this year - but most retail investors still wouldn't touch them with a 10-foot pole.

And with the Standard & Poor's 500 Index now on a losing streak - it's down about 5% from its April 2 high, according to Bespoke Investment Group LLC - you can bet that this "keep-stocks-away-from-me" sentiment has only intensified.

I mentioned this to Keith Fitz-Gerald, our chief investment strategist, during a private briefing last week.

True to form, Keith quickly said out loud what I had already been thinking.

"BP, those investors are making the mistake of their lives," he said. "In fact, I'll wager that they're actually compounding an already-huge mistake. They missed out on the most-powerful stock market rebound since the Great Depression - and they did that after having sold out at the very bottom of the bear market that preceded it, meaning they locked in some of the most-horrific market losses most investors have ever seen."

If you're in that group, don't fret: You can recover.

In fact, Keith helped me lay out a game plan just for you - one that will let you take charge, put the odds in your favor and even capitalize on approaching opportunities that Wall Street will be slower than you to see.

Let's take a look ...

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Obamanomics: What You Can Expect if President Obama Wins the Election

Now that we are left with a two-horse race for president, the markets are going to begin to handicap the November results.

However, when the markets begin to handicap the race it will be about a lot more than just picking the eventual winner.

Instead, everything will revolve around the policies and consequences that come along with the winner.

The difference in approach promises to be stark with "Obamanomics" on the left and "Romneynomics" on the right.

Each one comes with its own set of consequences, though.

Today I'm going to look at "Obamanomics II," or the policies we will get if President Obama is re-elected.

But those on the left shouldn't despair...In my next piece, it's Romney's turn.

As for the horserace itself, it's too close to call, with neither side having much chance of winning a big victory.

President Obama Has the Edge

Even still at the moment, President Obama appears to be ahead. Apart from his modest lead in the polls, my former home state of Virginia appears to be swinging definitively toward the Democrats.

Yes, Republican Bob McDonnell did win the Virginia governorship handily in 2009, but he was a very good candidate. Moreover, turnout in gubernatorial elections is normally low. Thus I believe the latest polls showing Obama with a 7% lead in Virginia are accurate, and without Virginia Romney has a very difficult path to the presidency.

If we believe the presidential election will be close, then it follows that Congress and the Senate elections must be close, too.

If Obama wins in November, the most likely outcome must be that the Democrats will hang on to the Senate, while the Republican House majority survives, albeit much smaller than at present.

With this combination, the president's more extreme wishes (or those of his team) will be restrained. But as a newly re-elected figure he will nevertheless have more power to get what he wants than he does currently.

Whatever the congressional numbers may be, the president's first task will be to face the "fiscal cliff" of January 2013, when the Bush tax cuts and temporary payroll tax cuts expire and automatic spending "sequestration" comes into effect.

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U.S. Economy Showdown: Krugman vs. Bernanke

Nobel Prize winning economist Paul Krugman has some critical words for how Team Bernanke is handling the U.S. economy.

The Princeton University professor suggested on Bloomberg Television's "Street Smart" program Monday that U.S. Federal Reserve policy makers, under the guidance of Chairman Ben Bernanke, are "reckless" for refusing to pursue inflation.

Krugman argues that higher inflation could lower the staggering U.S. employment rate that has lingered for more than four years.

"The reckless thing is to allow mass unemployment to continue," Krugman said Monday. "We have had a massive failure of our political system that has come to accept that 8% unemployment is the new normal and there is nothing that can be done. We're in a low-key version of the Great Depression."

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Are Economic Indicators Signaling a Sell Off?

Summary:A slew of economic indicators – weak growth, poor jobs, low home prices – are pointing south, but the stock market has been moving up. Money Morning Capital Waves Strategist Shah Gilani joined Fox Business' "Varney & Co." Monday to explain the disconnect between the markets and the U.S. economy. Gilani forecast what investors can […]

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Earnings Fuel Stock Market Gains – Dow Jones Soared More than 100 Points Midday

Yes, Friday was all about the earnings.

The stock market rallied Friday thanks to a roaring round of positive earnings reports - with a little help from positive news out of Europe.

Just after noon, the Dow Jones Industrial Average climbed 113 points, the Standard & Poor's 500 jumped 9 points and the Nasdaq gained 22.

With little on the economic calendar to close out the week, and no major reports due, market participants focused on encouraging first-quarter results from a spate of several large and market-influencing firms.

"There's been a wrestling match all week long between strong earnings and weak economic data. At the moment earnings are winning," Lawrence Centura, portfolio manager at Federated Investors told the Associated Press.

Strong Earnings Push Stock Market Gains

To date, quarterly earning has been pleasantly strong.

"The number of companies reporting positive surprises is much higher than it typically is at this stage in the game," Fred Dickson, chief market strategist of D.A. Davidson & Co. told CNN Money. "They're only beating by a little, but it's still a significant number of companies and that's the wow factor."

Of the 212 companies in the S&P 500 that have reported, better than 80% have exceeded expectations, according to Thomson Reuters. During a typical quarter, the percentage of companies that top forecasts is 60%.

Here are some recent highlights:

  • Tech giant Microsoft (Nasdaq: MSFT) lead Friday's gains in the broad-based rally after beating expectations late Thursday, reporting sales growth of 6% thanks to its Window and Office products. MSFT gained 4.55% Friday to close at $32.42.
  • Investors also ate up better-than-expected numbers from fast-food king McDonald's Corp. (NYSE: MCD), which ended the day up. The company proved it remained a worldwide favorite with same-store sales up 8.9% in the U.S., 5% in Europe and 5.5% in Asia-Pacific, Middle East and Africa. Revenue rose 8% (excluding currency fluctuations).
  • Robust earnings from General Electric (NYSE: GE) pushed its stock up 1.15% to $19.36. GE narrowly beat expectations with quarterly profit of 34 cents a share, a penny higher than expected, and revenue of $35.18 billion compared to a forecast $34.7 billion.
  • Meanwhile, traders traded E*Trade (Nasdaq: ETFC) up some 6% on better-than-expected first-quarter results. E*Trade's first-quarter profit rose 38% from a year earlier.
  • Technology manufacturer Honeywell (NYSE: HON) beat on both earnings and revenue, sending the honey pot buzzing. First-quarter income climbed 17% from a year earlier, and the company raised its 2012 forecast.

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Why March Madness is Bigger than the Super Bowl

If you're planning on taking a little bit of time out of your work day to watch the first round of March Madness today, you're not alone.

A survey by MSN showed 86% of employees will spend at least part of their workday checking in on the tournament, up from 81% last year.

And 56% of employees will devote at least one working hour to each of the first two days of March Madness.

With U.S. workers earning an average of $23.29 per hour, employers will lose roughly $175 million to distracted employees on just those two days, according to Chicago-based outplacement firm Challenger, Gray & Christmas.

In the past, the firm has found that in all more than $1 billion worth of productivity goes to waste during the entire March Madness tournament.

Of course, the tournament doesn't just lose money...

March Madness also makes it - a lot of it as it turns out.

March Madness Has More Green than the St. Patrick's Day Parade

The most watched tournament in the country generates over 90% of the NCAA's entire operating revenue.

And it means even bigger business for CBS Corp. (NYSE: CBS) and Time Warner Inc. (NYSE: TWX), which teamed up to pay $10.8 billion for the rights to broadcast the tournament through 2024.

While a 30-second spot during this year's Super Bowl cost a record $3.5 million, the 3.5 hour long program still only generated about $245 million of total ad revenue.

But with three Turner Networks sharing broadcast rights with CBS, the four channels took in $738 million in ad sales last year.

That's 20.2% more than in 2010, when the tourney brought in $613.8 million.

And that doesn't even include revenue from online advertisements on streaming games or a new smartphone app selling for the first time this year at a price of $3.99.

Online viewing has become extremely popular over the years, especially during the first two days of the tournament when multiple games take place during working hours.

In 2011, CBS and Time Warner said free digital viewing resulted in an average of 2.4 million daily unique visitors on broadband and 702,000 average daily unique users on the mobile app.

In total, there were 26.7 million visits across online and mobile from the start of the First Four on March 15 to the completion of the third round on March 20. That was a 63% increase over the year prior.

Meanwhile, online revenue from the tournament surged 825% from $4 million in 2006 to $37 million in 2010. There's no data available on how much it took in last year.

Then there's the gambling.

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Iran is Now a Full-Blown Crisis, Stage Set for $200 Oil

Just when it looked like we could take a breather from the Strait of Hormuz, all attention is back on Iran.

There are three reasons for this - all happening within the last week:

  1. First was Tehran's successful launch of a satellite, viewed by all in the region as being for military intelligence.
  2. Second, in his toughest talk to date, Iranian Supreme Leader Ayatollah Ali Khamenei voiced defiance to Western sanctions and pledged open retaliation if they are instituted.
  3. Finally, last Thursday, U.S. Secretary of Defense Leon Panetta expressed concern that, if matters continue, Israel could attempt an air-strike takeout of Iranian nuclear facilities within a month. Iran has been frantically moving essential components of its nuclear program underground to withstand such an attack.
All of this is, once again, leading to a rise in crude oil prices.

What's more, the EU decision to stop importing Iranian crude starting July 1 will cripple any chance Tehran has to combat escalating economic and political turmoil at home.

Yet Khamenei's defiant tone during his Friday prayer meeting speech indicates that Iran's religious leadership will not wait for the system to unravel.

And that is what makes this both a full-blown and an intensifying crisis.

Brinksmanship in the Straits of Hormuz

So what's being done?

Washington has little - leverage, save its ability to temper an immediate escalation by Israel (leverage the U.S. can still apply, at least for the moment). It also has some indirect influence on what the E.U. does.

Meanwhile, Saudi Arabia also is a wild card. It will not tolerate a nuclear Iran.

And yes, there are ample indications that American and Israeli intelligence have concluded Iran will achieve the ability to develop nuclear weapons in the next 18 to 24 months.

Some elements of that process will be available earlier, but remember: A weapon is of little value unless it can be controlled and delivered. The logistical and infrastructure considerations need to be in place first.

Yet with such an inevitable conclusion staring them in the face, the West has decided to embark on a risky path...

The target here is not the nuclear project at all (over which there is less and less outside control). Instead, it has become about creating massive domestic instability to bring down a regime.

Now, this is not about ending the theocracy. With or without Mahmoud Ahmadinejad as president or Ali Khamenei as supreme leader, Iran will remain a Shiite-dominated country. Religion decisively controls politics, and the clergy oversees the society.

The West is seeking a more moderate application of what will remain the Iranian cultural reality.

However, as the brinksmanship intensifies, so will the price of crude oil. Tehran, in this dangerous game of international chicken, really only has one card to play - the Strait of Hormuz.

There has been much misinformation circulated about the strait. Here are the facts.

On any given day, 18% to 20% of the world's crude oil passes through it.

According to the Energy Information Administration, the Strait's narrowest point is 21 miles wide; however, the width of the shipping lane in either direction is just two miles, cushioned by another two-mile buffer zone.

Of greater significance, though, is the fact that most of the world's current excess capacity is Saudi. (This is the oil that can be brought to market quickly to offset unusual demand spikes or cuts in supply elsewhere.) And, unfortunately, Saudi volume must find its way through the same little strait.

If we're unable to access the Saudi excess, that loss guarantees the global market will be out of balance. That will intensify the price upsurge - an upsurge that is already happening.

Now for the question I'm being asked several times a day in media interviews...

Just how bad can it get?

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Five Economic Blunders of 2011 and Five Fixes for 2012

Government's ability to fix the economy's problems may be limited, but it at least should try not to make matters worse.

Unfortunately - but not surprisingly - many of the things that happened in Washington this year did the U.S. economy more harm than good.

More than two years after the official end to the recession, the U.S. economy is still suffering through sluggish growth and an 8.6% unemployment rate.

"They've been wrong from the beginning, and they're still wrong," said Money Morning Chief Investment Strategist Keith Fitz-Gerald of U.S. government policymakers. "It makes you wonder if any of these people passed Economics 101."

That said, here are five of the government's worst economic blunders of 2011:

  1. The Debt Ceiling Crisis: While Congress did step back from the brink of plunging the nation into default, the fear and uncertainty resulting from the battle over raising the debt ceiling unnerved stock markets and was the main reason Standard & Poor's cut the U.S. credit rating from AAA to AA+ for the first time ever. The worst part of it was that the whole battle was unnecessary. Congress votes often to raise the nation's debt ceiling, a necessity to keep borrowing the 40% of the federal budget not covered by receipts.
  1. The Bungled Federal Budget: In mid-January, the federal government will have operated without an official budget for 1,000 days. The lack of a real budget makes it harder for government agencies to plan, as funding depends on a series of "continuing resolutions" by Congress. Failure to pass one of these stopgap measures would result in a government shutdown, which both Republicans and Democrats have used as a threat to try to force the other party's hand. Even worse, lawmakers argued about, but ultimately took no action on, reducing the crippling $15 trillion national debt or the huge annual deficits that keep driving it higher. Both are anchors on the U.S. economy.
  1. The U.S. Federal Reserve's Loose Money Policies: Led by Fed Chairman Ben Bernanke, the central bank has used every policy tool at its disposal to flood the U.S. economy with money in a futile effort to spur growth. Not only has it held interest rates near zero for more than two years, but it has conducted two "quantitative easing" bond-buying programs (not to mention mortgage-backed securities). Those policies have failed to implement either of the Fed's dual mandates to hold down the unemployment rate and control inflation.
  1. U.S. President Barack Obama's Jobs Bill: Despite a lot of dramatic rhetoric, President Obama's American Jobs Act was more of a re-election ploy than a serious attempt to deal with the high U.S. unemployment rate. The president knew Republicans would object to many of its provisions, as well as its hefty $447 billion price tag, but also knew those same provisions would appeal to his political base. Even if it had passed intact, economists said it would at best lower unemployment only by a single percentage point.
  1. The Payroll Tax Cut: While the House Republicans were foolish to fight the Senate and President Obama on the deal that was made to extend the payroll tax cut for two months, they were right about one thing: Any extension should have been for the full calendar year. Instead of resolving the issue, Congress merely postponed the fight over further extending the 2% cut in the Social Security tax deduction until February. Apart from that, who thought putting money into Americans' pockets by lowering payments into the already-threatened Social Security Trust fund was a good idea? Talk about mortgaging the future.
That leaves plenty of room for improvement, doesn't it? Now let's look at five things the government could do that could actually help the U.S. economy:

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Why the U.S. Economy Will Be Weaker Than Expected in 2012

Anyone who hoped the U.S. economy would get back on track in 2011 was sorely disappointed.

The European sovereign debt crisis and the abysmal failure of policymakers to take effective action undermined any chance we had at a strong recovery.

And what's even worse is that we're in for more of the same in 2012. Indeed, the U.S. economy in 2012 will be even more sluggish than originally thought - and for the same reasons 2011 was a disappointment.

The Organization for Economic Cooperation and Development (OECD) estimates U.S. growth will slow to 2% next year, down from a 3.1% estimate in May. It forecasts growth will pickup to 2.5% in 2013.

Of course, these forecasts are contingent upon Congress finding a way to stimulate the economy and tighten fiscal policy - not an easy balance to achieve. Without such action, U.S. economic growth next year could be as slim as 0.3%, and only hit 1.3% in 2013.

Unfortunately, after a year of failing to reach a debt reduction agreement, there's little chance the government will rise to the occasion next year - especially when most representatives are focused more on reelection than they are resolution.

Furthermore, it's also doubtful that Europe's debt crisis will be contained enough to not severely disrupt the region's biggest nations and cause a credit crunch that ripples through the global economy.

That means another year of major risks.

"Uncertainty remains the watchword for the U.S. economy," said Money Morning Global Investing Strategist Martin Hutchinson. "The risks are still pretty high because no one's sure what the Europe outcome will be."

The likely outcome - U.S. economic growth will fall even lower.

Europe: The Biggest Unknown

The OECD earlier this week reported that Europe's weak monetary union is the main threat to the world economy. The group's 34 member nations, including the United States, will grow 1.9% this year 1.6% next, down from the May predictions of 2.3% and 2.8%.

"Contrary to what was expected earlier this year, the global economy is not out of the woods," Chief Economist Pier Carlo Padoan wrote in the OECD Economic Outlook.

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What the World Will Look Like if Occupy Wall Street Wins

There are many reasons why the Occupy Wall Street movement could fail - a lack of cohesion, too many directions, no leadership, not enough money, and no representation, to name a few.

But what if it "succeeds?"

What would our investing landscape look like and what would we do about it?

I think that's an interesting question, especially since Occupy Wall Street has gained some traction, even taking on a global appeal. And more importantly, there are two other reasons the movement could succeed:

  • First, our political system is broken and has deteriorated into little more than a fancy debating society.
  • And second, the world's central bankers remain out of control; their bailouts are saving the irresponsible at the expense of the hardworking. Our regulators and Wall Street remain locked in an unholy alliance that has done very little to fix the underlying problems that have resulted from decades of bad fiscal policies, unsound monetary practices, and dysfunctional leadership.
You may remember the 1960s and the many protest movements that were very clearly focused on civil rights and the Vietnam War. You even may have been part of a few.

A lot of people thought they would go away, too. But Tom Hayden and his collection of Students for a Democratic Society didn't. Nor did Abbie Hoffman, Bobby Seale, and others. Their passion and that of thousands who joined in eventually succeeded in changing the course of social consciousness.

OWS could too.

By shunning the hierarchy that is organized politics and corporate America, there is the sort of strength necessary to address the growing disparity and the vanishing opportunities that are the new economic reality for millions of Americans.

I, for one, am hopeful that OWS will find the leadership needed to clearly delineate its goals and mandate change on the strength of the raw unvarnished potential that is now driving it.

I am also hopeful that OWS will succeed in raising the social consciousness to the point that living within our means becomes both an economic and political reality.

But that's just me. You may have entirely different feelings. That we might not agree is irrelevant.

Since OWS began, I've been watching carefully and doing a lot of deep thinking about what things might look like if OWS "wins" - however you define the term.

So here's a look at some of the potential changes that could take place if the movement succeeds:

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GDP Is a Lie – It’s Time for a New Measure of Economic Growth

Gross domestic product (GDP) is the most commonly used measure of economic growth. But GDP isn't just inaccurate and misleading - it's the contrivance of Keynesian economists seeking to push their own, big-government agenda.

That's right. GDP is a financial ruse - the biggest of the past half-century. And it's time to move past it to another, more accurate measure of economic growth.

Keynesian economist Simon Kuznets designed GDP at the height of the New Deal era. Kuznets first revealed the measure in a report to Congress in 1934. GDP takes into account consumption, investment and government expenditure to create a measure of economic growth.

But the Keynesians employed some chicanery, or sleight-of-hand, to generate this statistic. A close look reveals the dirty little secret about GDP: It intentionally overplays the importance of government spending - and in doing so inflates the role that Washington plays in each of our lives.

And it's been doing this for 77 years ...

The Biggest Lie of the 20th Century

Gross domestic product is supposed to be a measure of all the goods and services produced here at home.

But there's a discrepancy.

You see, private-sector output is measured by the price people are prepared to pay for it. But government output is fudged: It's measured by its cost.

That means GDP increases any time the government spends money. It doesn't matter if that money is actually put to productive use or not - GDP rises nonetheless.

The bureaucrat devising regulations that damage business? His salary increases GDP. The $300 million Alaskan "bridge to nowhere" of a few years back? That was $300 million added to GDP. The jet-fighter project that costs billions, and is plagued by huge overruns that lead to its cancellation? Those billions add to GDP.

Even public-spending "stimulus" programs, however foolish, are always effective according to the GDP definition, because their cost is simply added to output.

It's obvious why big-government Keynesians would like this calculation: It substantiates their claim that government spending stimulates economic growth.

In the real world, however, this makes no sense. Indeed, none of the examples above actually add to economic welfare.

Don't misunderstand - some government output is very valuable. We could not exist in a free society without a court system that protects our property rights and a national defense that protects our borders. In most other cases, however, if government output were truly cost effective, the private sector would've already taken the initiative (and probably done so at lower cost and greater impact).

So how can you get an accurate measure of economic growth?

Arithmetically, there's a simple solution: You take Line 1, "Gross Domestic Product," in the Bureau of Economic Analysis' GDP Table and subtract from it Line 21, "Government Consumption Expenditures andGrossInvestment. "

That gives you a net number, which we can call "gross private product," or GPP. It's a measure of all the output produced by the private sector. In general, it will underestimate national "welfare" unless government is really bad. But it will give you a much better idea of the output the market economy is producing.

Indeed, looking at GPP's past performance helps to explain some things that GDP doesn't.

Keynesians like to proclaim that World War II got America out of the Great Depression: Thus, if you make stimulus big enough, it will solve economic problems.

This is the biggest lie of the 20th century.

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The Debt-Ceiling Debate: Three Federal Tax Increases That Could Save the U.S. Economy

As the debt-ceiling debate escalates, U.S President Barack Obama says federal tax increases are necessary to close the U.S. budget deficit.

Although Republicans then said that tax hikes were "off the table," this statement is reminiscent of a toddler who threatens to hold his breath until he turns blue if you make him eat spinach.

Given that our elected leaders in Congress just can't seem to curb their spending addiction, the unpleasant reality is that some types of tax hikes are essentially inevitable.

Truth be told, I can show you three tax increases that should be enacted.

As a taxpayer, that statement will probably make you wince in anticipated pain.

But once I've made my case, I'm betting that the investor in you will agree that these three federal tax increases could save the U.S. economic recovery.

Let's take a look ...

Federal Tax Increases We Don't Want to See

If we ignore the debt-ceiling debate (and the Aug. 2 deadline for increasing the ceiling) for a minute, and just consider the health and welfare of the U.S. economy, we can see that there are a number of federal tax increases that would be highly counterproductive.

One example: boosting the corporate tax rate above 35%.

Except for Japan, the United States already has the highest corporate tax rate in the Organisation for Economic Co-operation and Development (OECD). Corporations don't pay much tax because they are able to keep profits overseas in tax-free jurisdictions and employ leasing and other tax breaks. It would make much more sense to lower the corporate tax rate - perhaps to 30% - and close many of the loopholes so that the "yield" (what's actually collected) is the same or perhaps even a little higher.

Similarly, it makes no sense to increase the 15% tax on dividend income. Dividends are paid by corporations out of their after-tax income. The levy on dividends - paid by the company's shareholders - means those companies actually suffer from a "double-taxation" rate of about 47%.

This encourages companies to fool around with stock options, repurchase agreements and with overpriced acquisitions, thus ripping off ordinary shareholders and reducing the economy's efficiency.

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How to Fix the U.S. Housing Market

If this week's economic reports showed us anything, it's the fact that two years into what's supposed to be an economic recovery, the U.S. housing market remains on life support.

But here's what those reports didn't tell you: If the housing market isn't fixed soon, it's going to drag the rest of the economy down into a hellish bottom that will take years, if not decades, to crawl out of.

The housing market is our single-most important generator of gross domestic product (GDP) and, ultimately, national wealth.

It's time we fixed what's broken and implemented new financing and tax strategies to stabilize prices.

Contrary to the naysayers - and in spite of political pandering and procrastination - we can almost immediately execute a simple two-pronged plan to fix mortgage financing and stabilize U.S. housing prices.

I call it a not-so-modest proposal.

The Worst Since the Great Depression

The facts are frightening: We are in a bad place. The plunge in housing prices we've seen during the current downturn is on par with the horrific freefall the U.S. housing market experienced during the Great Depression.

And without an effective plan to arrest the double-dip in housing, there's no bottom in sight.

Hope Now, an alliance of lenders, investors and non-profits formed at the behest of the U.S. Department of the Treasury and the U.S. Department of Housing and Urban Development, counts 3.45 million homes being foreclosed from 2007 through 2010. Current estimates of pending and potential foreclosures range from another 4 million to as many as 14 million.

According to RealtyTrac, a real-estate data provider, the country's biggest banks and mortgage lenders are sitting on 872,000 repossessed homes. If you add in the rest of the nation's banks, lenders and mortgage-servicers, the true number of these REO (real-estate owned) homes is closer to 1.9 million.

These shocking statistics illustrate just how large the current overhang of bank-owned properties actually is (at current sales levels, REO properties would take three years to unload). And they help us to understand how the staggering number of yet to-be-foreclosed, repossessed, and sold homes will depress U.S. housing market prices for years to come.

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Gasoline Price Outlook: An Epitaph For Sam the Service Station Man

I am a great believer in the American entrepreneurial spirit. In fact, the U.S. economy stands or falls on our ability to provide enough space to allow small folks to have big-time dreams.

However, when times get difficult, some little folks end up under the bus - along with their dreams.

To understand what I mean, let's take a look at my friend Sam.

Many of you may remember Sam, the proprietor of an out-of-the-way rural service station situated outside of Pittsburgh. I introduced him to Money Morning readers last summer in an essay: Gasoline-Price Forecasting: What Sam the Gas Station Owner Knows That We Don't.

I've known Sam for years.

So I was stunned to discover that he's throwing in the towel.

To understand what this means for gasoline prices, please click here...

Retirement Concerns Plague U.S. Baby Boomers

Retirement used to be synonymous with leisure and travel. Americans believed that decades of hard work and thriftiness would make for a prosperous and successful life they could enjoy after their jobs - the "American Dream."

Now retirement doesn't evoke the same sense of tranquility for most U.S. workers. Instead, economic anxiety has taken its toll.

Americans used to ride a "three-lane highway" into retirement: a traditional pension, Social Security, and individual savings plans, like 401(k)s.

But the recent economic downturn packed a devastating punch to many 401(k) accounts, U.S. households have dipped into savings to make ends meet, and debt-laden federal, state and local governments will have trouble meeting pension and Social Security obligations.

As the first of the 78 million U.S. Baby Boomers start to retire, most of them worry they don't have enough retirement savings to support them in their post-work years.

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