June 5, 2017

It Appeared That Demand Would Never Be Satisfied

A report from the Toronto Star in Canada. “Toronto region home prices have dipped slightly from April to May — down $55,604 on average — but still 15 per cent higher than May 2016, as the supply of re-sale house and condo listings rose 43 per cent year over year. There were 18,477 listings in May compared with 12,931 the comparable month last year. In Toronto alone, there were 1,611 more homes on the market than in April. It is the third consecutive month that listings have increased although May saw a significantly higher number of homes hitting the market. The province’s cooling plan, including a foreign buyer tax and expanded rent controls, started a discussion, said Royal LePage Signature Realty agent Tom Storey. ‘Whether or not something’s actually changing, you end up with people talking about it and things are going to change,’ he said.”

From The Telegraph in the UK. “It’s comfortably above the price of the average UK home, but £350,000 is merely the cost of a so-called ’sweetener’ when the international super-rich are shopping for a multimillion-pound property. When one such buyer viewed a £25 million mansion in Mayfair shortly before Christmas, the vendor offered his Rolls-Royce Phantom – worth £350,000 – as an incentive to persuade the high net-worth individual to sign on the dotted line. It did the trick.”

“Michael Ferris, the property director whose firm JR Capital invests in UK property on behalf of wealthy clients from the Gulf, says the luxury London market has slumped since the back-end of 2015 due to an arsenal of Government measures designed to make London a less lucrative piggy bank for oligarchs’ cash, compounded by political uncertainty. ‘Developers have had to grin and bear it over the last 18 months to get the deals over the line,’ Ferris says. ‘It’s been a buyer’s market, so they have been able to ask for incentives.’”

From Al-Monitor on Iran. “The ‘Iranian dream’ is the same around the world. Until recent years, the demand for housing was amplified by a volatile economy in which real estate presented the safest option for investment. This made housing one of the most prosperous sectors of the national economy. Few believed that the sector’s growth would slow, as it appeared that demand would never be satisfied.”

“Despite the increased demand for rental properties, the number of empty homes in Iran has increased. The Statistical Center of Iran announced last year that one out of every 10 residential properties in the country is vacant. The same survey revealed that more than 2.5 million housing units in Iran are unoccupied — 55% more than in 2011. Meanwhile, neither the Rouhani administration nor local authorities have proposed measures to increase taxes on empty homes. Thus, the reality may be that the core issue plaguing the Iranian housing market is not decreased demand but reduced supply — especially given the climate in which property owners refuse to sell at a loss.”

The Financial Express on India. “Prospective homebuyers perhaps seldom had it so good. From a significant fall in property prices to the lowest home loan rates (in a decade) combined with the power of RERA, almost everything seems to be in favour of those who want to buy or invest in a piece of residential property currently. Therefore, a question playing on the mind of many buyers and investors today is – is this a good time to buy a house?”

“‘It is very rare to see such a confluence of amenable and conducive market conditions for end-users and investors in Indian residential real estate. Prices are at their lowest now and unlikely to fall any further. There has also been a significant reduction in home loan interest rates, and many developers are offering interesting financing schemes as well as various other incentives and offers, including hard discounts,’ says Anuj Puri, Chairman, JLL Residential.”

“It is a well-known fact that residential real estate market is in a slump as builders are currently sitting on excess inventory of approximately 46 months across India. Assuming that the demand for housing will remain constant, it will take almost 4 years for all residential units to be completely sold out.”

“‘The harsh reality about investing in an apartment is that the supply of units is controlled by builders. So, in the long-run, if the number of units are going to increase in proportion to the demand, there will be no resale value for existing apartments. In fact, they are likely to depreciate due to the supply factors. Unless there are restrictions placed on the number of apartments that can be built, buying a house cannot be a lucrative investment,’ says Tejas Khoday, Co-Founder of FYERS, a thematic investing platform for young investors.”

From CNBC on China. “China has constructed more skyscrapers than any other country every year for nearly a decade, according to the Council of Tall Buildings and Urban Habitat. And the most iconic edifice in these transformed skylines is Shanghai Tower, a shiny column that spirals 128 floors and 632 meters into the clouds, making it China’s tallest building, and the world’s second-highest. But Shanghai Tower reflects wider woes in China’s commercial property market, as it has struggled to attract tenants since the last beam was placed on top three years ago. Experts say the challenge is that companies looking to cut costs amid a wider growth slowdown are now spoiled for choice.”

“Entire floors of Shanghai Tower continue to sit empty. A planned luxury hotel has yet to open and hallways remain deserted. About 60 percent of the office space has now been leased out, but only one-third of those tenants have moved in, said JLL. ‘With more and more skyscrapers in Shanghai, in cities [in China], the vacancy will remain very high for some time,’ said Anny Zhang, head of Shanghai office leasing for Jones Lang LaSalle, one of the agents for Shanghai Tower.”

From The Australian. “A looming apartment supply overhang is set to put more downward pressure on prices after apartment values in Sydney and Melbourne dropped more sharply than houses over the past month, dragging on the broader housing market. The supply increase makes it more difficult for landlords to find tenants, making them ‘very cautious’ about the prices they are willing to pay, BIS Oxford Economics senior manager for residential property Angie Zigomanis said. ‘It should keep putting pressure on prices.’”

“Kerry Williams, a 49-year-old social media manager, yesterday made an offer on a one-bedroom apartment in Elwood, Melbourne. She saw the softening market as an opportunity to make a long-term investment, picking a structurally solid unit in a small block in an area she hopes will be attractive to tenants. She has bought 15 properties in her life and currently owns four. ‘This is the first time in five years that agents have returned my calls. Normally I’m chasing them,’ she said.”

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Comment by Ben Jones
2017-06-05 09:42:44

‘Your house is not an ATM’

‘Apr 23, 2017′

‘Just chuck it on the mortgage. That’s what home-owning Kiwis do when they want to buy consumer goods that they can’t really, truthfully afford. Most of us love the latest model phone, flash laptops, TVs, newer cars, designer kitchens and bathrooms and lots of bling.’

‘What’s changed over the past 25 years for the average red-blooded Kiwi is that we’re using our homes like ATM machines, says Mark Lister head of private wealth research at Craigs Investment Partners. We roll our consumer spending into the mortgage because we can.’

‘The banks’ willingness to let us extend the mortgage means we get away with it. We can go to the bank and extend our mortgages to cover almost any spending we wish.’

‘Lister says many people can’t really afford the consumer goods they’re buying but give into temptation due to the wealth effect of rising house prices. Financial adviser Steve Morris, of SW Morris & Associates, points out that revolving mortgages allow us to dip into home equity without even going to the bank to ask for more money.’

‘Morris says nine out of 10 of his clients who have revolving credit mortgages misuse them. One client even bought a $60,000 boat that way.’

‘NZ Super payments are based on the premise that most Kiwis will own their home mortgage free by age 65. What’s more, KiwiSaver was designed to be drip-fed throughout retirement to supplement the meagre NZ Super. The problem is that we’re in effect borrowing the KiwiSaver pay out before we receive it.’

‘Just look across the Tasman. Mortgage application forms ask how much Aussie Super the borrower has. The banks make the assumption that this will be used to pay off the mortgage come retirement. The more I think about the ramifications of this, the sicker I feel.’

‘The Australian Bureau of Statistics found that the number of retirees withdrawing their super in lump sums has more than doubled in a decade. According to News Corp, in Australia 26 per cent of those withdrawals were funnelled into the home, 13 per cent paid for a holiday and 12 per cent were paying down debts. We’re just as good as the Aussies at building up that debt.’

‘Mortgage broker Jeff Royle, of iLender, sees clients doing it day in, day out. “They slap [consumer spending] on the mortgage over 20 years. The bank says ‘it’s serviceable’ and the client goes ‘yip-te-do’. They think, ‘I was paying $1500 a month instalments and now I’m paying $600.”

‘Royle has just settled a mortgage for a couple in their 30s who had $104,000 worth of what he calls “crap debt” spent on holidays and consumer goods.’

‘The credit culture means that people are also reaching retirement with consumer debt ranging from HP to car and personal loans, which will have to be paid off somehow. Anyone who thinks all this debt is essential should take fewer hallucinogenic drugs.’

Comment by Ben Jones
2017-06-05 09:57:09

‘revolving mortgages allow us to dip into home equity without even going to the bank to ask for more money’

It sure sounds like an ATM.

Comment by Mr. Banker
2017-06-05 10:28:56


Pukes in the Southern Hemisphere are just as dumbed-down as pukes in the Northern Hemisphere.

Comment by Ben Jones
2017-06-05 10:50:05

‘One client even bought a $60,000 boat that way’

The article mentions 50 year mortgages. Imagine paying for a boat for 50 years.

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Comment by Fan
2017-06-05 12:15:52

Imagine paying 50 years for a boat anchor and green handshakes.

Comment by Professor Bear
2017-06-05 19:49:31

Imagine getting a boat, then defaulting on the loan when the economy tanks and you lose your job.

Comment by rms
2017-06-05 20:37:20

“Imagine getting a boat, then defaulting on the loan when the economy tanks and you lose your job.”

I know a guy who lost his job in Stockton, CA, and on his way home to Discovery Bay he bought a new water ski boat with his severance check. He insisted on a stereo system and custom rims for the trailer. He and his silicone wife squatted in their faux luxury home for a couple of years before the divorce. She actually upped her standard of living an order of magnitude while he disappeared.

Comment by Professor Bear
2017-06-05 19:48:30

“It sure sounds like an ATM.”

Except you need to have money in your bank account in order to make an ATM withdrawal…

Comment by snake charmer
2017-06-05 12:16:10

Didn’t this sort of thing really blow up, with tremendous adverse consequences, in the United States in the middle of the last decade? But there’s less risk of that happening in New Zealand, because the country has a “z” in its name!

I have to laugh during those times when financial prudence is lauded as a new social trend, because our economy has come to depend on staying-out-of-debt being faddish.

Comment by Raymond K Hessel
2017-06-05 14:32:58

‘The Australian Bureau of Statistics found that the number of retirees withdrawing their super in lump sums has more than doubled in a decade. According to News Corp, in Australia 26 per cent of those withdrawals were funnelled into the home, 13 per cent paid for a holiday and 12 per cent were paying down debts. We’re just as good as the Aussies at building up that debt.’

Each and every one a victim.

Comment by oxide
2017-06-06 08:50:26

I dunno, I recall quite a few of these Aussie homes had their bathrooms in a little hut in the backyard. If that 26% paid for actual indoor plumbing then maybe it was a good investment.

Comment by Professor Bear
2017-06-05 19:45:14

What’s changed over the past 25 years for the average red-blooded Kiwi is that we’re using our homes like ATM machines, says Mark Lister head of private wealth research at Craigs Investment Partners. We roll our consumer spending into the mortgage because we can.’

Business Day
Homeowners Feel the Pinch of Lost Equity
NOV. 8, 2007

RENO, Nev., Nov. 5 — As his wedding day approached last spring, Marshall Whittey found that his money could not keep pace with the grandiosity of his plans. But rather than scale back, he chose instead, like millions of homeowners across the country, to borrow against the soaring value of his home.

He and his bride, Holly Whittey, exchanged vows on the grounds of a sumptuous private estate in the Napa Valley. They spent their honeymoon at a resort in Tahiti.

But now, in an ominous portent for the national economy, Mr. Whittey has grown tight with his money. His home is worth far less than it was a year ago, and his equity has evaporated. And like many other involuntary adopters of a newly economical lifestyle, he can borrow no more.

“It used to be that if I wanted it, I’d just go and buy it and finance it,” Mr. Whittey, 33, said. “I’m feeling the crunch, and my spending is down significantly.”

The Whitteys and others like them are at the center of deepening worries that the economy is headed for a substantial slowdown, possibly even a recession, as the artery of cash from Americans borrowing against the value of their homes has sharply narrowed.

Everybody was basically using their house as an A.T.M. machine,” said Dave Simonsen, a senior vice president for NAI Alliance, an industrial real estate firm in Reno. “Now they are upside down on their house without that piggy bank to go back to.”

From 2004 through 2006, Americans pulled about $840 billion a year out of residential real estate, via sales, home equity lines of credit and refinanced mortgages, according to data presented in an updated working paper by James Kennedy, an economist, and Alan Greenspan, the former Federal Reserve chairman. These so-called home equity withdrawals financed as much as $310 billion a year in personal consumption from 2004 to 2006, according to the data.

But in the first half of this year, equity withdrawals were down 15 percent nationally compared with the average for the last three years, and consumption supported by such funds plunged nearly one-fourth, according to the Kennedy and Greenspan data.

This summer, the size of withdrawals fell even more sharply to about one-third below the level of late last year, according to Mark Zandi, chief economist at Moody’s Economy.com.

“This slide in equity withdrawal is very recent,” Mr. Zandi said, “so you wouldn’t expect the drop in spending to occur until now, or Christmas.”

Comment by rms
2017-06-05 20:52:30

“It used to be that if I wanted it, I’d just go and buy it and finance it,” Mr. Whittey, 33, said. “I’m feeling the crunch, and my spending is down significantly.”

Lemme guess… you have a dead bedroom too.

Comment by snake charmer
2017-06-06 07:33:20

And here is that guy. Back then, he worked for a company in the homebuilding industry. (Of course he did.) He’s no longer in that line of work. And according to Washoe County records, he and his wife divorced in 2010.



Comment by oxide
2017-06-06 11:47:15

Private estate wedding in Napa, honeymoon in Tahiti… and divorced after less than three years? I guess it’s true what they say: the bigger the wedding the shorter the marriage.

The bio-blurb says he graduated with a Bachelor of Science degree from UN-Reno. And yet he’s selling flooring and tile? Yup, that’s what you get for majoring in STEM you momo. (I wonder which science?)

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Comment by Professor Bear
Comment by oxide
2017-06-06 08:56:56

Nice charts! Tons of equity withdrawal for all the usual suspects: Nevada, California, Florida, Virginia/Maryland. Not much equity pull in New York, interestingly. Probably because NY is actually a hick state once you get out of NYC.

Comment by Rental Watch
2017-06-06 13:27:18

Do you have those charts through 2017? They appear to be 10-years old.

Comment by Vancouver Guy
2017-06-05 09:57:20

“down $55,604 on average” That is a staggering blow to the home equity ATM. Most people can’t save that amount to save their lives, but they can sure as sugar loose it rapidly…

Comment by 2banana
2017-06-05 09:58:06

Toronto region home prices have dipped slightly from April to May — down $55,604 on average


Slightly? $55K…

In ONE month? Leveraged to 8:1?

Comment by Blue Skye
2017-06-05 11:01:39

The author must have meant “sleight”, as in how to make a coin disappear.

Comment by Raymond K Hessel
2017-06-05 14:49:24

Toronto home sales plunged 20.3 percent in May.

If a thing isn’t selling, there’s only one thing to do….



Comment by Professor Bear
2017-06-05 19:50:32

It’s a no-brainer, and amazing that people don’t get it.

Comment by MarkinSF
2017-06-05 10:04:21

Wolfstreet has a great piece describing the recent turn of events in the Toronto housing market. The best part is where bids were taken on a house and the “winner” bid $50k CAD over asking. Unfortunately for them this was the only bid received on the place. People are walking away from their deposits.
http://wolfstreet.com/2017/06/05/toronto-house-price-bubble-condo-pops/. Definitely worth a read

Comment by 2banana
2017-06-05 10:10:52

Buyers will soon pick up that “bidding” on a house that is for sale for a SET PRICE is a scam…

Comment by Tony, Tim, Dave, Mike and Dan..... And John.
2017-06-05 10:52:08

When the word “bid” is used relative to housing, it’s guaranteed there is fraud involved.

Comment by Raymond K Hessel
2017-06-05 14:27:25

“In effect, the market has stalled and is rapidly reversing from a seller’s to a buyer’s market,” said one of two sets of boots on the ground in Toronto. Neither of them wants to be identified. “Sellers are in a panic to offload their properties, especially those who have speculated in flipping homes. And buyers are starting to open their eyes.”

I love the smell of burning FBs in the morning. It smells like…victory.

Comment by Raymond K Hessel
2017-06-05 14:31:05

The pace of depositor withdrawals from Home Capital Group stabilized at the end of May, but now looks like it may be quickening.

I smell fear.

Be afraid, Toronto FBs. Be very afraid.


Comment by 2banana
2017-06-05 10:09:06


Of absolute and total rule by democrats and their public union goons.


Baltimore starts tearing down SEVENTEEN THOUSAND abandoned homes after decades of social decline
MailOnline | June 5, 2017

A dilapidated block of homes in Baltimore has been demolished as part of a $94 million project to tear down a chunk of the 17,000 abandoned homes in the neighborhood.

More than 800 crumbling homes have already been razed and this section of Herbert Street in West Baltimore is the latest to be reduced to rubble.

The homes - many of which are riddled with asbestos and lead paint - have come to symbolize the deep social divide in Baltimore.

Roofs have caved in on the abandoned rowhomes, boards are fastened to the doors and window frames and the streets are littered with garbage.

Sitting on a crumbling stoop, Sadiki said the block looked nothing like it did when he was a boy. His father’s old home was filled with debris, trash from squatters, and peeling paint.

‘I don’t see the broken windows and the sagging porches, I see it the way it was,’ Sadiki said.

‘Once these buildings are gone, it’ll be a huge erasure of my history. This whole thing, seeing it erased like this, really saddens me. But nothing lasts forever, it had to go sometime.’

For now, the area where he once lived will be turned into green space.

Comment by MarkinSF
2017-06-05 11:00:56

Baltimore used to be a great little city; deindustrialization brought it to it’s knees and destroyed it’s economy. How are you going to make a living?

Comment by Dday
2017-06-05 11:32:19

So they’re tearing down tattered old houses that have asbestos and lead paint. Are republicans in favor of asbestos and lead paint?

Comment by 2banana
2017-06-05 11:38:25

We are the music makers, And we are the dreamers of dreams…

Comment by taxpayer
2017-06-05 11:59:44

no gop in Baltimore,yo

Comment by Rental Watch
2017-06-05 12:58:54

We have old houses with asbestos and lead paint in California too. But we don’t tear them down because people are living in them.

The 17,000 homes aren’t being torn down because of the asbestos and lead paint. They are being torn down because they are vacant and abandoned.

Comment by new attitude
2017-06-05 12:39:59

What do you have against minorities? Baltimore, is mostly black isnt it?

Comment by rms
2017-06-05 21:29:32

“America’s Dad” will soon be vacant and abandoned.

Comment by Prime_Is_Contained
2017-06-05 21:15:17

With 17,000 abandoned houses, why are there bidding wars in Baltimore?

Comment by Vancouver Guy
2017-06-05 10:14:44

Toronto just faceplanted. My neighbor’s property sold for check this out… Originally 750K, then 1.4M, this year sold for 7M. All in 14 years. Last guy was by far the bravest. Amazes me how these greedy mofo’s will do anything to get to screw the next guy. This is going to be an amazing flame out…..

Comment by Prime_Is_Contained
2017-06-05 21:16:42

Last guy was by far the bravest.

Last guy had the bravest LENDER.

Comment by Carl Morris
2017-06-05 10:36:06

Imagine how crazy tulip bulbs could have gotten if people actually needed a tulip bulb for something.

All those people clucking their tongues at the losers who were priced out because they didn’t think ahead…shoulda gotten on the bulb ladder when they had the chance. Whatever happens to them now, it’s their own fault.

Comment by 2banana
2017-06-05 10:45:05

A tulip was at least tangible.

Crypto-currency (in its own bubble) exists nowhere in the real world.

Fiat money, with nothing backing it, exists nowhere in the real world.

Comment by Carl Morris
2017-06-05 11:56:37

I’m comparing to houses…not currency.

Comment by Ben Jones
2017-06-05 10:52:07

This was just posted in the last comments, no idea on the accuracy:


“Just up the road from where I live in Laurel heights(SF) a 4 bed/3.5bath house sold for 3.5m in Sept. of 2014. Well it just sold for 1.6m a few days ago!”

Comment by MarkinSF
2017-06-05 11:05:42

That can’t be true. Probably a duplex and they sold one of the units.

Comment by Ben Jones
2017-06-05 12:04:46

I looked this up:

31 Emerson St, San Francisco, CA 94118
6 beds 4 baths 2,422 sqft
For Sale
Price cut: -$138,000 (5/13)

05/13/17 Price change $1,550,000-8.2% $639 Sequoia Real E…
04/14/17 Listed for sale $1,688,000-3.5% $696 Sequoia Real E…
08/23/16 Listing removed $1,750,000 $722 Century 21 Rea…
02/26/16 Listed for sale $1,750,000+3.7% $722 Agent
07/07/15 Listing removed $1,688,000 $696 BARBAGELATA RE…
07/02/15 Pending sale $1,688,000 $696 Barbagelata Re…
04/11/15 Price change $1,688,000-10.6% $696 BARBAGELATA RE…
03/21/15 Listed for sale $1,888,000 $779


Comment by new attitude
2017-06-05 12:41:49

$4000 for a 1 bdrm apt in SF in a good area.

$3 for 30 mins on a Scooter, ride AND drop.

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Comment by MacBeth
2017-06-05 16:34:34

Shrinks must command a pretty penny in SF.

Comment by Rental Watch
2017-06-05 13:10:52

Looks like that one hasn’t traded hands in a while. Property taxes are based on assessed values that appear to have been set at or prior to 2000.

It says “multifamily”. I wonder if there are tenants in the property that are subject to rent control. If so, the rents could be very low, and the asking price could be indicative of a ridiculously low yield.


From Redfin, one of the four units currently rents for…$600 per month…another rents for $2,268 per month.

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Comment by MarkinSF
2017-06-05 15:16:45

I’m not seeing where this ever sold for $3.5m; sold for $102k back in 1980

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Comment by Ben Jones
2017-06-05 16:13:47

I never said it did. I was just poking around the neighborhood.

Comment by Professor Bear
2017-06-06 02:31:45

We’re going to see a lot more Dutch auction sales of luxury real estate bought at premium prices before the onset of the final stages of Housing Bubble collapse.

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Comment by Blue Skye
2017-06-05 10:58:35

2.5 million housing units in Iran are unoccupied…Thus, the reality may be that the core issue plaguing the Iranian housing market is not decreased demand but reduced supply.

This logic seems vaguely familiar. It is possible that those Persians are lining up for a watershed moment.

Comment by Blue Skye
2017-06-05 11:08:31

“First Since 2008: Existing Home Prices and Rents Fall in First-Tier”


Maybe they are suffering from reduced supply also?

Comment by Raymond K Hessel
2017-06-05 14:40:45

They’re not building now in Iran anymore. Buy now or be priced out forever.

Comment by Puggs
2017-06-05 11:20:28

Sheesh, Inflation is rearing it’s head in the insurance world, kiddo’s.

My home insurance shot up this year over $200. Car insurance shot up over $300. When I went to shop and compare I was getting higher rate quotes. Thankfully my life insurance premium is locked in!

Oh well, Time to tighten the belt further and cut back on the ‘ol discretionary spending.

Comment by taxpayer
2017-06-05 12:02:24

my auto w progressive stayed after a ticket and the wife’s slight fender bender
good is limited use

Comment by taxpayer
2017-06-05 12:04:47

good rates and can be based on miles driven

Comment by snake charmer
2017-06-05 12:06:50

“Entire floors of Shanghai Tower continue to sit empty. A planned luxury hotel has yet to open and hallways remain deserted. About 60 percent of the office space has now been leased out, but only one-third of those tenants have moved in, said JLL.”

The thing about the “Shanghai Tower” is that problems selling or leasing space there will have no effect whatsoever on anyone’s thinking. They’ll build more of them whether the Tower is occupied or not. Occupancy isn’t the point.

Does anyone really want to live 1,500 feet up? One time I had a job interview in Chicago in the building formerly known as the Sears Tower. It was on one of the upper floors, and it took me a long time just to ascend, as I had to use multiple elevators.

Perhaps the smog is less toxic up there, I guess that would be a selling point.

Comment by Raymond K Hessel
2017-06-05 14:43:24

And then there’s this architectural marvel in Pyongyang, the Ryungyong Hotel of Doom, another monument to central planning stupidity and hubris.


Comment by junior_kai
2017-06-05 19:38:56

Adding a new twist to the saying “got shanghai’d”.

verb (used with object), shanghaied, shanghaiing. Nautical. 1. to enroll or obtain (a sailor) for the crew of a ship by unscrupulous means, as by force or the use of liquor or drugs. Origin of shanghai.

Comment by aqius
2017-06-05 12:39:25

interesting article at india times details the current water crisis in mumbai. water tankers trucking-in water but projected to be dry in 3 years. residents have drained most of the local natural wells. call centers will relocate soon.

reminds me of lake mead situation.

but hey, everyone just ignore it . . . until its crisis time, then run around like headless chickens demanding a fix . . at much higher expense, of course.

mr banker sits back laughing at human foibles.

expensive learning curve for tunnel vision hamsters in the wheel.

then you die

Comment by palmetto
2017-06-05 13:18:09

Beware of water privatization. Possibly coming soon to a town/county near you. My sis tells me it has happened in some places in Connecticut.
And to some degree, it has happened here in Florida, with Nestle Waters sucking up the springs that supply the Hillsborough River.

Comment by MacBeth
2017-06-05 16:41:26

Al Gore!

What brings you to this humble site?

Comment by palmetto
2017-06-05 17:22:07

What aqius wrote has nothing to do with Al Gore. India does have a problem with potable water and its population.

And quite frankly, parts of Florida are starting to have difficulties with potable water as well. And population, for that matter.

Comment by redmondjp
2017-06-06 13:41:02

Well-stated. A lack of potable water will be a much more significant challenge to humanity in this century than a degree or two of warming will.

All over the western US in arid places, are rapidly depleting underground reservoirs that took millions of years to fill up.

In my college town of Pullman, WA (on eastern border with ID), the groundwater level (which was at the surface at the turn of the 20th century - artesian wells originally) has been linearly dropping at 3 feet per year since the 1950s.

Significant studies have been done of the groundwater in that area, with one conclusion: it isn’t getting adequately replenished, so it should be treated as a finite resource.

There is no plan ‘B’ for another water supply in that area either.

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Comment by oxide
2017-06-06 12:08:51

Thanks, aquis. This is probably more significant than any of the other articles posted here today. We knew that China was running out of good air, but India running out of water? Maybe they can start desalinating?

Comment by new attitude
2017-06-05 12:45:03

call centers will relocate soon - to the Philipines??

China crash coming soon.

Comment by ZHi
2017-06-05 12:57:37


The Real Unemployment Number: 102 Million Working Age Americans Do Not Have A Job

Comment by Karen
2017-06-05 14:25:54

Robert Schiller is Shilling for the State https://mises.org/blog/robert-shiller-shilling-state

I am often asked the question: “are mainstream economists stupid, or are they liars?” My response is that many are intelligent, honest, and seemingly public spirited, but they are slaves to a bad understanding of how an economy works and they live in an environment where bad economic ideas are highly rewarded. In particular, ideas that support the State are highly compensated in terms of money and prestige. They also often suffer from the pernicious ideology of progressivism.

I recently reviewed the new book by Shiller and Nobel award winning economist George Akerlof, Phishing for Phools: The Economics of Manipulation and Deception. I have never read a more personally biased, uninformed, and just plain wrong book on economics. Their basic approach is based on the notion that the competitive pursuit of profits leads entrepreneurs to discover deceptive ways of “phooling” customers and this manipulation will continue until some public-spirited bureaucrat comes in to break this “equilibrium” with new and stronger regulations..”

Comment by butters
2017-06-05 14:45:13

I think they may have a point if you look at the current breed of voyeurprenuers backed by cheap money.

Comment by Karen
2017-06-05 16:46:11

Are you talking about the government psy-ops alphabet and facebook?

Comment by Taxpayers
2017-06-05 16:38:59

90% of economist are edu or gov and edu us mostly gov = lefty

Comment by Neuromance
2017-06-05 19:20:53

I have to respectfully disagree with the critic. I read Phishing For Phools and thought it was thought-provoking and insightful.

I believe the critic is a “free market fundamentalist.” I am not a free market fundamentalist. I see that markets can fail, either as monopolies, where the monopolist can execute “monopoly pricing”, thus extracting all “marginal benefit” from the buyer, which is a sub-optimal outcome; or when the buyer has poor information relative to the seller. See for example a bad used car sold for a premium or a financial asset which is on the verge of failure is sold for a premium. An extreme example is the “shell game”, where the buyer is flat out cheated, though both are entering the transaction voluntarily.

The economy is a competition for resources. An entity provides goods or services or otherwise tries to persuade other entities to give him resources for them, typically in the form of money. Sometimes the game warps and one entity is able to extract destructive-to-the-other-entities amounts of resources. Especially in monopolies or in situations with highly asymmetric information.

As far as societies go, it seems to me they tend towards economic and political oligarchies, naturally. We’re in that slide again. We can have regulation to stave that off in an orderly fashion or we can get more fair outcomes by storming the Bastille. The latter is a very suboptimal method.

The perfect is the enemy of the good. Regulators become subject to regulatory capture. Nowadays, our politicians are subject to regulatory capture, forget the regulators. If there were a harsh rule, the company would simply lobby the politician controlling purse strings to lean on the agency head who leans on the regulator to back off. This step is often obviated by having the politician remove field-leveling regulations in the first place.

I was reading Bernanke’s speech at the Fed, on the occasion of Milton Friedman’s 90th birthday. There was this tidbit: “At the same time, the large banks–which would have intervened before the founding of the Fed–felt that protecting their smaller brethren was no longer their responsibility. Indeed, since the large banks felt confident that the Fed would protect them if necessary, the weeding out of small competitors was a positive good, from their point of view. ”

Regulation has certainly become warped nowadays, putting a disproportionate load on smaller entities. The key is optimizing, not throwing the baby out with the bathwater. Simple effective regulations, not those leading to 100,000 page submittals (the BofA CEO said that’s how thick BofA’s stress test results would be) would be useful. Complexity breeds loopholes, which everyone should hopefully realize, but don’t.

Comment by Neuromance
2017-06-06 04:05:31

One more note: I mentioned monopoly as a market failure. Certain prescription drugs are monopolies. However there are some large buyers who could potentially influence price. Like the US government as part of Medicare. However, politicians specifically prevent the government from negotiating drug prices as part of Medicare, Part D.

We still have the vote, diluted by gerrymandering (aka “politicians picking their voters instead of voters picking their politicians”). But politicians are in the business of selling their services to the highest bidder. Which of course influences regulation.

Comment by Prime_Is_Contained
2017-06-05 22:01:08

the competitive pursuit of profits leads entrepreneurs to discover deceptive ways of “phooling” customers

Well, they got that part right, at least. I call it the Scam Economy—watch your wallet, cause supposed reputable companies try amazingly hard to junk-fee you to death.

Comment by ZHi
2017-06-05 15:35:50


redmond washington housing prices CRATER 8% yoy

Comment by redmondjp
2017-06-06 13:49:41

Hi Housing Analyst!

Nope. Try again. You’re using the same garbagy data sites as before.

Here’s the truth about our local market:


Comment by Raymond K Hessel
2017-06-05 18:43:24

I’m sure this is nothing. The MSM would surely alert us if contagion was a remote possibility.


Comment by Raymond K Hessel
2017-06-05 19:15:36

Banco Popular share price in a freefall. Has the bank run started yet?

Reminder: Spain and Italy are too big to be bailed out. When they default, as they will, it’s game over.


Comment by Professor Bear
2017-06-06 02:27:12

I smell an incipient ECB bailout.

What’s Next for Troubled Spanish Lender Popular: QuickTake Q&A
by Charles Penty and Patrick Henry
Mon Jun 5 20:00:04 2017

Popular in Fight to Survive as Bank Updates ECB

Time is running out for Banco Popular Espanol SA and its efforts to fix a balance sheet loaded with toxic property assets. The Spanish bank’s admission that it’s short of capital and may seek a buyer sparked a collapse in investor confidence that caused its market value to shrink to well below the value of its last share sale in 2016. The bank is due to meet with European Central Bank officials on Tuesday as it explores ways to improve liquidity. One option: requesting additional central bank loans.

Comment by Carl Morris
2017-06-06 10:01:57

Spain and Italy are too big to be bailed out.

Is anything too big to be bailed out by a central bank that can freely print what others will trade goods and services for?

Comment by palmetto
2017-06-05 20:24:47

anyone else have this weird, tense feeling something big is about to go down?

Hope it’s another RE crash, but this time for real.

Comment by Blue Skye
2017-06-05 21:10:26

Yeah, but you shouldn’t be tense if you have been gradually insulating yourself from the risks for the past decade. Those who have not may be falling down a flight of stairs for decades to come. You can watch, but you don’t have to get weird. What would you be doing if you knew this mess would take longer than we’ll be alive to unwind?

Comment by rms
2017-06-05 21:18:30

“anyone else have this weird, tense feeling something big is about to go down?”

Memorial Day weekend was nowhere near as busy as previous years. Starting to see cars with “take over payments” on For Sale signs too.

Comment by Professor Bear
2017-06-06 02:14:06

Whatever might be about to go down, I am certain that nobody can see it coming.

Comment by Fan
2017-06-06 03:50:24

What is crystal clear is deep state #$&*ing with everyone.

Comment by Professor Bear
2017-06-06 04:19:56

And by and by getting ever more extreme.

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Comment by Professor Bear
2017-06-06 03:18:14

Apparently some financial writers are unfamiliar with the weather phenomenon known as “the calm before the storm.”

Financial Times
A ‘Minsky moment’ isn’t imminent, but investors should be wary
Biggest current risk lies in equity markets trading at record levels with merely average global growth
Markets Insight
The recovery in the US is relatively mature and the Trump reflation has stalled
an hour ago
by: John Plender

The persistence of ultra low volatility so far this year has taken many by surprise. The interesting question is whether this should be a cause for rejoicing or concern.

… the absence of volatility has as much to do with monetary policy in the advanced countries remaining accommodative overall as with global growth or the robustness of financial systems. Sustained low volatility also gives rise to complacency, which is one reason why it might be time to revisit Hyman Minsky’s famous financial instability hypothesis, which posits that financial systems have an inbuilt tendency to swing from robustness to fragility, with adverse consequences for the business cycle.

Certainly unconventional central bank measures such as quantitative easing anaesthetise precautionary instincts. Low volatility encourages carry trading, which can involve mismatching of currencies, and a search for yield regardless of risk. The compression of spreads in credit markets this year is striking evidence of investors’ insouciance. So, too, is the lack of concern about geo-political risk.

We are still in a world where it is difficult to generate growth without the fuel of debt. Since the financial crisis public sector debt in the developed world has increased to potentially unsustainable levels against a background of deteriorating demographics. That point about credit dependency applies with equal force to China, which is locked into a stop-go pattern of growth marked by ever-increasing leverage. And global imbalances continue to mar the global economy as big companies rack up excessive savings.

Comment by phony scandals
2017-06-06 05:41:56

“anyone else have this weird, tense feeling something big is about to go down?”

“You know when you’re sitting on a chair and you lean back so you’re just on two legs and you lean too far so you almost fall over … I feel like that all the time…”.

Steven Wright



1:00 - 1:24 is the only 24 seconds out of the 10:23 that wasn’t funny.

Comment by frankie
2017-06-06 03:23:38

Average UK rents have fallen for the first time in more than seven years, with London seeing the biggest decline, according to new data.

The slowdown in the rental sector mirrors a similar picture in the housing market, with figures showing that property prices have fallen for the third month in a row.

The average monthly rent on a new tenancy that started in May was £901, which was down 0.3% on the May 2016 figure of £904, according to the latest rental index from HomeLet, which provides services to landlords and letting agents. It is the first such fall recorded by the company since December 2009.
Yes, house prices are falling: but they probably won’t fall quickly
Read more

However, the typical new rent in London has fallen by 3% in a year. The weaker market in the capital has seen average rents fall from £1,572 a month in July 2016 to £1,502 in May. That means new tenants in London are typically paying £70 a month less than their counterparts last summer.


Comment by frankie
2017-06-06 03:30:11

Is there another property bubble? The housing market in 4 charts
Forget the conjecture and take a look at the data - it suggests that while there might be some areas of concern, rising prices do not, in themselves, a bubble make.

It’s not a bubble say governor of the Central Bank Philip Lane, the Minister for Housing Simon Coveney and ratings agency Moody’s. It is, say putative home buyers and economists like Colm McCarthy. But who is right?

Prices are undoubtedly rising – and fast – but this does not a bubble make, in itself. A bubble happens when price appreciation is unsustainable because the fundamentals – ie earnings, demand, etc – do not support it.


When I see quotes like this, the question that comes to mind is “A fool or a knave”. In this case they may actually be foolish knaves.

Comment by Mr. Banker
2017-06-06 06:26:36

“In this case they may actually be foolish knaves.”

Foolish slaves.

The dotted lines continue to work their magic.


Comment by aNYCdj
2017-06-06 07:08:15

so sad weep for this home, kumbayyaah

No one wants to buy this 55-bedroom Texas mansion


Comment by rms
2017-06-06 07:27:08

Is it walking distance to the beach?

Comment by aNYCdj
2017-06-06 07:41:37

2354 County Road 59 in Manvel walking distance to costco, its really not very isolated looks like they have a little private lake

Comment by phony scandals
2017-06-06 08:04:07

“It is designed for at least 55 bedrooms and 55 full baths and would be ideal for some type of institutional use, said Miller, who has been showing the property for more than a year.”

Perfect Obamacare Heroin Rehab!

Addicts For Sale

In the rehab capital of America, addicts are bought, sold, and stolen for their insurance policies, and many women are coerced into sex.

Posted on March 19, 2016, at 9:14 a.m.

Cat Ferguson
BuzzFeed News Reporter


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Comment by aNYCdj
2017-06-06 08:04:13

Despite top property-tax rate in Connecticut, the state’s capital teeters on bankruptcy


At the current level, a Hartford resident who owns a home with an assessed value of $300,000 currently pays an annual tax bill of $22,287, at rate of 7.43%. A West Hartford homeowner with a similar house pays $11,853 at a rate of 3.95%.

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