According to Bloomberg, of the $162 Billion dollars of INFRASTRUCTURE aidthe U.S. federal government pledged to spend in February as part of its unprecedented $787 Billion Economic STIMULUS package, only about $50 Billion, or 31%, has been paid out thus far. As a result, it can be reasonably concluded that most global infrastructure/industrial companies that stand likely to benefit from the massive U.S. stimulus program (Examples include: CAT/Caterpillar, GE/General Electric, DE/Deere, FWLT/Foster Wheeler, FLR/Fluor, UTX/United Technologies, ETN/Eaton, JEC/Jacobs Engineering, SGR/Shaw Group, MDR/McDermott, HON/Honeywell, TEX/Terex, etc.), will not see the desired effects on their respective companies' balance sheets until towards the end of 2009/beginning of 2010.
Somewhat related, the uber powerful and equally innovative CEOs of both Caterpillar (CAT) and Google (GOOG) appeared on MSNBC's Meet The Press program on Sunday, May 31st, 2009. During the engrossing CEO roundtablediscussion hosted by David Gregory (the clip is included below), both rock star executives shared their insightful assessments of the current state and future direction of the U.S. economy. I found it particularly interesting to listen to Jim Owens' take since he leads the operations of a company very much at the manufacturing heart of the U.S. economy. Among Mr. Owens' more interesting comments, the CEO of Caterpillar expects the global economy to BOTTOM sometime during the 3rd quarter of 2009. He also, perhaps somewhat tellingly, doesn't expect his company to resume hiring until mid 2010.
With Russia's stock market up approximately 80% year to date, CNBC television anchor Maria Bartiromo recently sat down with Russian President Dmitry Medvedev to discuss what lies ahead for Russia's heavily energy-dependent economy. Russia, the 'R' of the famous 'B.R.I.C.' acronym, owns the world's largest natural gas reserves and, as a result of the global slowdown that began in late 2007, witnessed its GDP shrink by a staggering 9.5% during the first quarter of 2009. Looking to the immediate future, economists are currently forecasting that the volatile pace of decline in Russian economic activity will slow during the 2nd quarter by a less break-neck rate of 6.5%.
In the below five minute interview segment, President Medvedez appears poised to utilize the government's vast resources ($600 BILLION U.S. dollars) to help deliver stabilization to Russia's volatile economy. Mr. Medvedez's current strategy appears focused on diversifying the country away from the energy and commodities sectors and into biotechnology sciences and information technology. Lastly, it's interesting to note that, according to CNBC, Russia's current unemployment rate is higher than the U.S's and stands at 10.2%...a figure that implies that about 7.7 million Russians are currently unemployed and looking for work.
On Thursday, May 7th, 2009, the U.S Federal Reserve FINALLY unveiled its long-awaited, eagerly-anticipated'Stress Test' (i.e: the Supervisory Capital Assessment Program) resultsperformed on the country's 19 largest financial institutions. These 19 banks each hold assets of at least $100 Billion and, collectively, are believed to represent about 2/3of the total assets contained in the entire U.S. Banking system.
Of the 19 U.S. commercial banks tested, 10 banks FAILED and will now need to raise a total of about $75 Billion in additional capital by November of this year. The 3 largest Bank Stress TestLOSERS are: Bank of America/BAC (needs to raise $33.9 Billion in capital), Wells Fargo/WFC (needs to raise $13.7 Billion), and the former wholly-owned financial services arm of General Motors (GM), GMAC/GJM (needs to raise $11.5 Billion).
One of the Treasury's primary litmus tests for the stress tests it conducted revolved around an interesting accounting metric known asTangible Common Equity or TCE. Tangible Common Equity is designed to indicate how much 'ownership equity' owners of common stock would actually receive in the event of a company's forced liquidation. According to Wikinvest, TCE intends to remove the more subjective components of valuation (intangible assets and goodwill) from the calculation of a company's underlying worth. The accounting formula for the TCE ratio is a company's Total Shareholders Equity MINUS its Intangible Assets(non-physical assets on a company's balance sheet - exp's include: intellectual property, brand recognition), Goodwill(the premium paid by an acquiring company over and above the acquired company's Tangible Book Value)and Preferred Stock as a percentage of Tangible Assets. During the stress tests, the U.S. government made it clear that it strongly urges all 19 commercial banks to maintain a TCE of at least 4% moving forward.
Due to uncertainty regarding the future macroeconomic environment, the Federal Reserve tested the TCE of each of the 19 banks under 2 different economic scenarios - 1.) 'Average Baseline' and 2.) 'Alternative More Adverse'. Per the above chart, the more optimistic 'Average Baseline' case carried the following assumptions for 2009: -2% GDP 'growth', 8.4% unemployment and a 14% decrease in nationwide housing prices. Meanwhile, the 2009 assumptions used by the more pessimistic 'Alternative More Adverse' view were: -3.3% GDP 'growth', 8.9% unemployment and a 22% decline in housing values.
Lastly, it should most certainly be noted that the April's U.S. jobs/payrolls report was released this past Friday and the country's unemployment rate currently stands at 8.9% - already exactly matching the more pessimistic unemployment assumption used in the 'Alternative More Adverse' scenario. According to Dean Baker of the American Prospect, a healthier or more realistic assumption for the country's unemployment rate in 2009 would be 9.4%. It should also be noted that per the above S+P Case/Schiller nationwide 10 city housing prices index graph, the current real decline in 2009 housing prices has also ALREADY virtually matched the housing assumption used in the 'Alternative More Adverse' scenario. Furthermore, most 'experts' believe housing prices will continue to decline in 2009 and probably finish the year down by about 24-25%. As a result and anecdotally thinking, it looks like the assumptions used by the Federal Reserve in their 'Average Baseline' scenario are entirely too optimistic (14% decline in housing??) and disingenuous at best. Meanwhile, the assumptions employed in the 'Alternative More Adverse' scenario don't seem to be pessimistic enough unless the U.S. economy rebounds sometime during the 2nd half of 2009.
------------------------------------------------------------------------------------- BANK Stress Test RESULTS - Scorecard :
10 Banks That FAILED (Ticker) - Capital Needed : * Bank Of America (BAC) - $33.9 Billion * Wells Fargo (WFC) - $13.7 Billion * GMAC (GJM) - $11.5 Billion * Citigroup (C) - $5.5 Billion * Regions Financial (RF) - $2.5 Billion * Suntrust Financial (STI) - $2.2 Billion * Morgan Stanley (MS) - $1.8 Billion * Keycorp (KEY) - $1.8 Billion * Fifth Third Financial (FITB) - $1.1 Billion * PNC Financial (PNC) - $0.6 Billion
9 Banks That PASSED (Ticker): * Goldman Sachs (GS) * JP Morgan (JPM) * US Bancorp (USB) * Metlife (MET) * American Express (AXP) * Bank Of New York Mellon (BK) * State Street (STT) * Capital One Financial (COF) * BB&T Corp (BBT)
While some of the major details are still evolving (...for instance, whether or not Australia will hire private-sector multinational IT companies like Cisco/CSCO, Siemens/SI, IBM, or even Google/GOOG to help out), Australia's government recently committed to a highly ambitious eight-year, $30.5 Billion Internet infrastructure spending project that will aim to significantly boost the country's current broadband network capacity and also, preserve 200,000 Australian JOBS. Per Australia's Prime Minister, Kevin Rudd, the country's LARGEST EVER infrastructure project to date "will support 25,000 jobs every year over the eight-year life of the project", and will also provide citizens with Internet access 100 times faster than currently available speeds.
Some additional bullet points: * The Australian government plans to form and temporarily own 51% of the new company that will be responsible for making the initial investments of approx $3.4 Billion in order to build and operate the new high-speed Internet network...The government plans to sell its stake in the company five years after the project's completion
* In order to FINANCE the entire $30 Billion undertaking, the government currently plans to sell up to $16 Billion in BONDS to the public and also plans to raise $14.3 Billion via 'private (equity) investment'
* The plan's seemingly earnest objective is to supply 90% of Australian homes with Internet connections of up to 100 megabits per second and the remaining 10% with speeds of up to 12 megabits per second
* According to JPMorgan's Chase & Company's Internet Investment Guide, about 17% of Australia's population had access to high-speed Internet connections in 2008 (this rate compares to 19% in both the U.S. and Japan...and also to 26% in both South Korea and Switzerland)
* Australia's unique geography (many cities densely located on its coast, the sparsely-populated Outback) has made Broadband advancement a difficult issue in the past
* Kevin Rudd, Australia's Prime Minister, made Broadband infrastructure expansion a priority during his 2007 political campaign...According to Reuters, Rudd's current popularity is near-record levels in domestic opinion surveys
* In addition to the $30 Billion (43 Billion Australian dollars) pledged to stimulate Australia's economy via this massive Broadband plan, Australia's government has pledged approx $57 Billion (78 Billion Australian dollars) in economic stimulus since September 2008(the now infamous date marking the collapse of the artist formerly known as Lehman Brothers)
According to the U.S. Labor Bureau of Statistics' March 2009 payrolls report, the number of unemployed Americans rose to a jaw-dropping 13.2 million people. During March, the country lost 663,000 jobs and the nation's Unemployment Rate rose to a staggering twenty five year high of 8.5%. The last time the unemployment rate was this high was back in November 1983, when the economy was recovering from the 1981-1982 recession that eventually pushed the jobless rate close to 11%. Perhaps even more disturbing is the fact that nearly 1/4 of all jobless Americans have been unemployed for a period of six months or longer - this is also the highest proportion since the above-cited 1981-1982 recession.
Over the past five months, the country has lost an astounding 3.3 MILLION jobs; including a loss of 2 MILLION jobs during the first three months of 2009. For some perspective and per CNN, if no more jobs are lost in 2009 (mind you, this seems to be a VERY unlikely scenario...), 2009 would still be the 4th worst year for job losses since the government began tracking payrolls data back in 1939. In total, since the recession officially began back in December 2007, the U.S. economy has lost a sickening 5.1 MILLION jobs!
In addition to WIDESPREAD job cuts (virtually every U.S. economic sector lost jobs in March except for 'health care and education services' which actually saw an 8K increase in payrolls), employers also cut back on employee hours. The average hourly employee work week fell to 33.2 hours, the lowest level on record going back to 1964.
Lastly, the country's Underemployment Rate also warrants mention as it continued to rise and ended March at a whopping 15.6% ! FYI, the government's underemployment rate attempts to capture 1.) all unemployed Americans already included in the government's unemployment rate, 2.) those job seekers who have recently given up looking for a job, and 3.) those workers currently holding part-time jobs but are seeking full-time work. The amount of underemployed Americansrose by approx 423,000 in March and now total aRECORD 9 million American workers.
Per the $825 Billion President Obama U.S. Economic Stimulus Package, the Senate is currently proposing that $340 Billion will allocated to rebuilding America's economy via The American Recovery and Reinvestment Plan. Below are the current specific financial highlights of the The American Recovery and Reinvestment Plan courtesy of the U.S. Senate Appropriations Committee 1/23/09 press release (FYI, the link to the seven page press release is included at the bottom of this post).
Please be advised that the disclosed plan below is subject to revision as it will be reviewed on the floor of the U.S. House of Representatives next week.
The American Recovery and Reinvestment Plan focuses on 5 critical areasto rebuilding our economy and creating the conditions for economic growth in the long-term :
* Infrastructure and Science - $140 Billion
* Education and Training - $125 Billion
* Energy - $51 Billion
* Protecting the Vulnerable - $25 Billion
* Health - $16 Billion
It is estimated that this legislation will create or sustain 4 million American jobs.
* Infrastructure and Science: $140 Billion
In order to rebuild our weakening economy, these investments in our physical and cyber infrastructure will put Americans immediately to work rebuilding our crumbling roads and bridges, and will also enable the creation of a stronger and more efficient infrastructure for the 21st century economy. Highlights include:
• School Modernization: $16 billion to repair, renovate and construct public schools in ways that will raise energy efficiency and provide greater access to information technology, and $3.5 billion to improve higher education facilities.
• Broadband: A total of $9 billion for the National Telecommunications and Information Administration’s (NTIA) Broadband Technology Opportunities Program to improve access to broadband.
• Public Parks: $3.4 billion for repair, restoration and improvement of public facilities at parks, forests, refuges and on other public and tribal lands.
• Department of Defense Facilities: The stimulus includes $2.4 billion for quality of life and family-friendly military construction projects such as family housing and child care centers.
• $3.2 billion for Facilities Sustainment, Restoration and Modernization to be used to invest in energy efficiency projects and to improve the repair and modernization of Department of Defense facilities to include Defense Health facilities.
• $3.4 billion for VA hospital and medical facility construction and improvements, longterm care facilities for veterans, and improvements at VA national cemeteries.
• $1.2 billion to accelerate procurement and installation of baggage screening and checkpoint security equipment atairports across the country.
• $500 million to secure high risk critical infrastructure such as dams, tunnels, and bridges.
• $4.6 billion to construct, repair or rehabilitate water resource infrastructure nationwide to benefit navigation, hydropower, flood control, environmental restoration, shore protection and other purposes.
• $1.4 billion to construct, repair, or rehabilitate water delivery infrastructure in the Western U.S. to benefit irrigation, municipal and industrial water supplies, power production, and environmental and other purposes.
• $2.25 billion for the HOME Investment Partnerships Program block grant to enable state and local governments, in partnership with community-based organizations, to acquire, construct, and rehabilitate affordable housing and provide rental assistance to poor families.
Transportation:
• $27 billion for formula highway investments.
• $8.4 billion for formula investments in public transportation.
• $5.5 billion for competitive grants to state and local governments for surface transportation investments.
• $1.3 billion for investments in our air transportation system.
• $1.1 billion for investments in rail transportation.
• $160 million for investments in maritime transportation.
• Public Lands Roads: $830 million for repair and restoration of road on park, forest, tribal, and other public lands.
Public Housing:
• $5 billion to the public housing capital fund to enable local public housing agencies to address a $32 billion backlog in capital needs - especially those improving energy efficiency in aging developments.
• $2.1 billion for full-year payments to owners receiving Section 8 project-based rental assistance.
• Neighborhood Stabilization Program - The bill includes $2.25 billion for the redevelopment of abandoned and foreclosed homes.
• Homeless Prevention Fund - The bill includes $1.5 billion for homeless prevention activities, which will be sent out to states, cities and local governments through the emergency shelter grant formula.
Environmental Clean-Up/Clean Water:
• A total of $6.4 billion is directed towards environmental cleanup of former weapon production and energy research sites.
• $6 billion for sewer, wastewater, and drinking water systems nationwide through EPA’s Clean Water and Drinking Water State Revolving Funds.
• $1.4 billion to support $3.8 billion in loans and grants for needed water and waste disposal facilities in rural areas.
• $1.4 billion for EPA’s nationwide environmental cleanup programs, including Superfund.
Science:
• National Science Foundation (NSF) Research: $1.4 billion in funding for scientific research, infrastructure and competitive grants.
• National Aeronautics and Space Administration (NASA): $1.5 Billion for NASA, including $500 million for Earth science missions to provide critical data about the Earth’s resources and climate.
* Education and Training: $125 Billion
In order to compete in the 21st century, Americans must have a well-educated workforce, capable of adapting to an ever-changing economic environment. Investing in education now will ensure that the next generation of American workers is ready and able to meet the challenge of global competition. In the near-term, millions of workers have seen their jobs disappear, and find themselves unable to match their skill sets with existing opportunities. Providing job training in new and expanding fields will help to lower the unemployment rate and help today’s workers better compete against foreign competition. Highlights include:
Education:
• $39 billion to local school districts and public colleges and universities distributed through existing State and federal formulas.
• $15 billion to states as incentive grants as a reward for meeting key performance measures.
• $25 billion to states for other high-priority needs such as public safety and other critical services, which may include education.
• Title I: $13 billion to help close the achievement gap and enable disadvantaged students to reach their potential.
• Special Education/IDEA: $13 billion to increase the Federal share of special education services to its highest level ever.
• Pell Grants: $13.9 billion to increase the Pell Grant maximum award and pay for increases in program costs resulting from increased eligibility and higher Pell Grant awards.
Training:
• Training and Employment Services: $3.4 billion for job training including formula grants for adult, dislocated worker, and youth programs.
• Vocational Rehabilitation State Grants: $500 million for state formula grants to help individuals with disabilities prepare for and sustain gainful employment.
• Employment Services Grants: $400 million to match unemployed individuals to job openings through state employment service agencies and allow states to provide customized reemployment services.
* Energy: $51 Billion
The bill provides investments in areas critical to the development of clean, efficient, American energy, including modernizing energy transmission, research and development of renewable energy technologies, and modernizing and upgrading government buildings and vehicles. Highlights include:
• $40 billion to the Department of Energy for development of clean, efficient, American energy.
• GSA Federal Fleet: $2.6 billion to replace older motor fleet vehicles owned by the Federal Government with alternative fuel automobiles that will save on fuel costs and reduce carbon emissions.
• Green Buildings: $6 billion for repair of federal buildings to increase energy efficiency using green technology. This funding will help eliminate the backlog of $8.4 billion in building repair projects.
• $1.3 billion for grants or loans to owners for energy and green retrofit investments.
• $613 million for Department of Defense energy efficiency upgrades and construction of alternative energy projects, including wind and solar power and photovoltaic system installation.
• $400 million for rural businesses initiatives including development of renewable energy.
* Protecting the Vulnerable: $25 Billion
The current economic crisis has affected all Americans, but none more so than the most vulnerable among us. The spending proposed here will serve to lessen the blow of the current recession, providing immediate relief for children, the poor, and others who may find themselves struggling to put food on the table or a roof over their head. It will also address the urgent need to provide safe and secure places to live, even in neighborhoods that are struggling with high unemployment and surging foreclosure rates. Highlights include:
Nutrition:
• $16.5 billion for additional Supplemental Nutrition Assistance Program (SNAP) benefits (formerly the Food Stamp program).
• Special Supplemental Program for Women, Infants, and Children (WIC). The Committee recommends a total of $500 million for WIC. In addition, the bill provides $150 million for Food Banks.
Helping Children:
• $4.6 billion to increase investments in early childhood programs.
Other Programs:
• Community Development Financial Institutions: $250 million to immediately provide capital to qualified community development financial institutions (CDFIs) to invest in the development of underserved communities.
• Social Services Block Grant: $400 million for States and local non-profits to deliver critical services to unemployed and low-income individuals struggling with the effects of the recession.
• Homeowners Assistance Program: $410 million to expand the Department of Defense Homeowners Assistance Program (HAP) during the national mortgage crisis.
* Health: $16 Billion
The bill provides investments in areas critical to immediate and long-term healthcare for millions of Americans. Improved information technology, research facilities, and health and wellness programs, will all provide a better foundation for providing quality healthcare to consumers. Highlights include:
Health Information Technology:
• Health Information Technology: $5 billion to jumpstart efforts to computerize health records to cut costs and reduce medical errors.
Research:
• $3.5 billion to conduct biomedical research in areas such as cancer, Alzheimer’s, heart disease and stem cells, and to improve NIH facilities.
• $1.1 billion to the Agency for Healthcare Research and Quality, NIH and the HHS Office of the Secretary to evaluate the relative effectiveness of different health care services and treatment options.
Treatment and Prevention:
• Prevention and Wellness: $5.8 billion to fight preventable diseases and conditions.
• Pandemic Flu Preparedness: $870 million to complete funding for the President’s initiative on pandemic flu preparedness.
* Small Business, Law Enforcement, Other: $8 Billion
• $110 Million for GAO and Agency Inspectors General in order to provide appropriate oversight of spending contained in this bill.
• Loans for Small Businesses: $730 million to stimulate lending to small businesses.
• State and Local Law Enforcement: $3.95 billion total to support law enforcement efforts.
According to the U.S. Department of Labor's Bureau of Labor Statistics, the national unemployment rate hit 6.7% in November 2008. Drilling down to the STATE level, below are the Top 10 Highest Unemployment Rates in the United States:
It would be a MASSive understatement to describe 2008 as just a 'tough' year for the GLOBAL Financial Markets and Financial Services Industry. Many are going further than that and are already referring to 2008 as the most difficult and trying U.S. market environment since The Great Depression of the 1930's. Rigorous academic discourse and hyperbole aside, here are some eye-opening STATS courtesy of Bloomberg to tie a ribbon on things + put the 2008 GLOBAL financial FALLout in some perspective :
* Global stock markets lost about 1/2 of their value in 2008, or $30.1 TRILLION !
* In the U.S., $7.2 TRILLION of shareholder value was wiped off the books, as the Standard & Poor’s 500 Index fell 39% through Dec. 30 and the Nasdaq dropped 42%
* The Amex Securities Brokers/Dealers Index (fyi, the Broker/Dealer Index is comprised of 12 of the most widely known firms in the brokerage sector...the ticker is XBD) hit a high of 267.69 on June 1, 2007...as of Dec. 30, 2008, the index stood at 74.26 (down 72%!)
* The wave of writedowns and losses that swamped financial institutions around the world reached $720 Billionthis year.
* During 2008, the global financial-services industry announced 220,360 JOB CUTS.
* According to the FDIC, there were 25 Bank FAILURES in 2008, the most in 15 years.
* Lehman Brothers (the artist formerly known as LEH)., with assets of $639 Billion, filed the LARGEST bankruptcy in U.S. history on September 15th, 2008...its creditors may have lost as much as $75 Billion, the firm’s chief restructuring officer said.
* In the Largest U.S. bank failure in history, Seattle-based Washington Mutual (the artist formerly known as WM) collapsed in September with approx $307 Billion in assets.
* New York-based Citigroup Inc. (C), whose shares lost 78% of their value this year, needed $20 Billion in U.S. bailout funds in November on top of an earlier $25 Billion infusion of capital. The government was also forced to guarantee $306 Billion of the bank’s troubled assets.
* The U.S. government was forced to rescue the WORLD's LARGEST insurance company, American International Group (AIG), with a $152.5 Billion package of investments, loans and capital infusions
* General Motors (GM) and Chrysler LLC will get $13.4 Billion in federal loans to stay afloat until President-elect Barack Obama’s administration can devise a rescue plan of its own.
* Overall, the U.S. Federal Government has committed $8.5 TRILLION of stimulus in 2008 in order to jumpstart the U.S. economy
* Global merger activity fell to $2.5 TRILLION in deals announced in 2008 vs. the record 4.1 TRILLION worth of deals announced in 2007 (down 39%)
* Hedge funds lost 18% of their value for the year through November, the worst year since record-keeping began in 1990, according to Chicago-based Hedge Fund Research Inc. Morgan Stanley estimated that, by year end, at least 620 hedge funds will have closed.
* According to Investment Company Institute, a Washington-based firm, individual investors pulled $215.7 Billion from stock market mutual funds during the first 11 months of 2008...this compares to a net inflow of $91 Billion during the same period in 2007
"The Federal Open Market Committee decided today to establish a target range for the federal funds rate of 0 to 1/4 percent.
Since the Committee's last meeting, labor market conditions have deteriorated, and the available data indicate that consumer spending, business investment, and industrial production have declined. Financial markets remain quite strained and credit conditions tight. Overall, the outlook for economic activity has weakened further.
Meanwhile, inflationary pressures have diminished appreciably. In light of the declines in the prices of energy and other commodities and the weaker prospects for economic activity, the Committee expects inflation to moderate further in coming quarters.
The Federal Reserve will employ all available tools to promote the resumption of sustainable economic growth and to preserve price stability. In particular, the Committee anticipates that weak economic conditions are likely to warrant exceptionally low levels of the federal funds rate for some time.
The focus of the Committee's policy going forward will be to support the functioning of financial markets and stimulate the economy through open market operations and other measures that sustain the size of the Federal Reserve's balance sheet at a high level. As previously announced, over the next few quarters the Federal Reserve will purchase large quantities of agency debt and mortgage-backed securities to provide support to the mortgage and housing markets, and it stands ready to expand its purchases of agency debt and mortgage-backed securities as conditions warrant. The Committee is also evaluating the potential benefits of purchasing longer-term Treasury securities.
Early next year, the Federal Reserve will also implement the Term Asset-Backed Securities Loan Facilityto facilitate the extension of credit to households and small businesses. The Federal Reserve will continue to consider ways of using its balance sheet to further support credit markets and economic activity.
Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; Christine M. Cumming; Elizabeth A. Duke; Richard W. Fisher; Donald L. Kohn; Randall S. Kroszner; Sandra Pianalto; Charles I. Plosser; Gary H. Stern; and Kevin M. Warsh.
In a related action, the Board of Governors unanimously approved a 75-basis-point decrease in the discount rate to 1/2 percent. In taking this action, the Board approved the requests submitted by the Boards of Directors of the Federal Reserve Banks of New York, Cleveland, Richmond, Atlanta, Minneapolis, and San Francisco. The Board also established interest rates on required and excess reserve balances of 1/4 percent."
I am an avid follower of all things related to the expansion and forward progress of our dear GLOBAL Economy. I use this blog as an informal forum, and data repository of sorts, to both share + catalog my thoughts on the economy, and potential 'investible' stocks, sectors and themes in the market. If you act on any of my ideas, or observations, then please realize you are doing so at your own risk. Please feel free to leave interesting, thought-provoking comments on the blog ('Random Thoughts of Brill/Blog-iance')..if you're $hy you can do so Anonymously. If you wish to contact me directly with your comments, then please do so via e-mail, THANKS.
According to Bloomberg, of the $162 Billion dollars of INFRASTRUCTURE aid the U.S. federal government pledged to spend in February as part of its unprecedented $787 Billion Economic STIMULUS package, only about $50 Billion, or 31%, has been paid out thus far. As a result, it can be reasonably concluded that most global infrastructure/industrial companies that stand likely to benefit from the massive U.S. stimulus program (Examples include: CAT/Caterpillar, GE/General Electric, DE/Deere, FWLT/Foster Wheeler, FLR/Fluor, UTX/United Technologies, ETN/Eaton, JEC/Jacobs Engineering, SGR/Shaw Group, MDR/McDermott, HON/Honeywell, TEX/Terex, etc.), will not see the desired effects on their respective companies' balance sheets until towards the end of 2009/beginning of 2010.
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