Food purchases at grocery stores

Over at Illusion of Prosperity, Mark has a nice analysis of Grocery Store Purchases.

The gist is that per capita they have been going down for a long time.  Check out his charts.

Walmart moving into groceries in a big way has probably had a measurable effect on the $ per capita. The stuff they stock is going to be at lower price points relative to grocers.

I think to some degree brand name processed foods are pricing themselves out. The shrinkage of package size has been very noticeable, with potato chips, for example. Where I would buy this product occasionally, I now just walk past that aisle. Whatever taste temptation is destroyed by the price.

Global slowdown in progress

MaxedOutMama documents it nicely: Die Euroliebe Ist Ein Wildes Tier

"Germany is now going into recession. Manufacturing is too low, and the bad construction PMI means that no internal forces can keep the services sector up.

A relatively minor downshift in the auto production trajectory is showing up pretty strongly as an economic negative (see CFNAI). But this was minor. If car sales fall a bit more, things get rough quickly.

Over the last few months, we have followed a very similar trajectory to 2011, and the reason is somewhat similar. Autos. Auto production. See Philly Fed.

The cause, however, is quite different and should give everyone pause. Extremely easy credit has been sustaining car sales, in part because used-car prices were so high that they sustained bad loans because bad loan losses were very limited. This may have worn itself out based on auto advertising I am hearing. If so, then we are in for a sustained deceleration in sales and auto production will shift toward a minor negative in the next few months.Last month's downward sales surprise hinted at this.

If that does happen, then all the negatives, which include external and internal factors (Euro tragedy and global deceleration, the domestic erosion of real incomes due to inflation, political uncertainty causing caution in business spending) start to pull us steadily down. Even if car sales stay up for the next few months, we probably will see some tax increases next year and therefore will go into frank recession then. "

Smart Canadian mortgage policy

Flaherty clamps down on mortgage rules to cool overheating market

 

Acknowledging his concern that Canada’s housing market is overheating, Finance Minister Jim Flaherty is clamping down with four changes to mortgage insurance rules...

...Mr. Flaherty confirmed that Ottawa will reduce the maximum amortization period to 25 years from 30 years. Secondly, the maximum amount of equity homeowners can take out of their homes in a refinancing is being reduced to 80 per cent from 85 per cent...

...the availability of insured mortgages will be limited to homes with a purchase price of less than $1-million...

...there will also be a new rule aimed at ensuring the size of a loan is not too big in comparison to household income. The maximum gross debt service ratio will be fixed at 39 per cent and the maximum total debt service ratio at 44 per cent.

Smart policies that should have been implemented in the US.

Economic cliff documented

DAVID ROSENBERG: 51 Signs The Economy Is A Total Disaster

Read more: http://www.businessinsider.com/david-rosenberg-charts-2012-6?op=1#ixzz1yMdx016A

Japan's holdings of foreign assets a fiscal backstop

Japan Retains Status as Biggest Creditor Nation - WSJ.com

"TOKYO—Japan retained its title as the world's biggest creditor nation in 2011, as the government's currency-market interventions and companies' overseas mergers and acquisitions helped boost the value of the country's foreign-investment holdings.
Japan's net foreign assets—the difference between its holdings of overseas assets, such as currencies and U.S. Treasurys, and its liabilities, such as Japanese government debt held by foreigners—stood at ¥253.01 trillion ($3.19 trillion) at the end of 2011, data from the Ministry of Finance showed Tuesday."

Of course, the flow of funds into Japan from this asset base tends to strengthen the yen.