Obama’s budget chief, assessing the economy, a few days ago:
“The freefall in the economy seems to have stopped,” Mr. Orszag said during an interview on CNN’s “State of the Union.” “The analogy is there are some glimmers of sun shining through the trees, but we’re not out of the woods yet.”
That was Sunday. The headlines since then:
CNN: “Housing starts fell 12.8 percent to a seasonally adjusted annual rate of 458,000, down 12.8 percent from a revised 525,000 in March, according to the Commerce Department. The reading is the lowest level since the government began keeping records in 1959. The second lowest reading came in January, when the rate of housing starts was 488,000.”
CNN: “American Express said Monday it will cut 4,000 jobs, or 6 percent of its global workforce, as part of an $800 million restructuring plan.”
The Fed: “The Federal Reserve reports that delinquency rates rose sharply in Q1 in all categories . . . Commercial real estate delinquencies (6.4 percent) are rising rapidly, and are at the highest rate since the early ’90s (as delinquency rates declined following the S&L crisis). Residential real estate (7.91 percent) and consumer credit card (6.5 percent) delinquencies are at the highest levels since the Fed started tracking the data (since Q1 ‘91).”
The Business Insider: “The Wall Street Journal has run its own version of the the Fed’s stress test on 900 small and midsize institutions, and it claims they’ll see losses of about $200 billion by the end of next year. In such a scenario, at least 600 of the banks would see their capital levels shrink to a level that would be deemed unsafe by regulators.”
CNBC: GM (GM) CEO Fritz Henderson was asked if there are any green shoots out there. Is there any rebound or sign that customers are coming back into GM showrooms in May? Answer: no.
On CNBC, they’re discussing the acceleration of foreclosures, not their deceleration.
Apparently the “glimmers of sun” that Orszag sees are a debilitating heat wave.