Bursting Those Bubbles Is Never Smooth
It’s Friday desk clearing time for this blogger. “Southern California real estate sales in December 2017 were up just under a percent from November and down nearly 4% from December of the previous year to a total in Los Angeles, Riverside, San Diego, Ventura, San Bernadino and Orange counties combined, according to Core Logic. ‘With inventory still tight, Southern California’s housing market closed 2017 with a year-over-year decline in December home sales, which were the lowest for that month in three years,’ said Andrew LePage, a research analyst with Core Logic.”
“Locally, there were 73 single-family homes and 13 condos sold in our coverage area this December. Of those, 27 single-family homes sold in the Hollywood Hills’ 90068 zip code. The median price for the area was down just under 2% from December 2016 to $1.451 million. The 90039 ZIP code, which includes parts of Silver Lake, Los Feliz and Atwater Village, had 20 home sales in December for a median price of $956,000, about 6.7% lower than the previous year. Condos in 90039 saw a nearly 20% drop in median price from last year to $728,000 for the five sold. Los Feliz saw 10 homes sell in the 90027 ZIP code for a median price of $1.43 million, roughly 17% lower than the previous December. The area’s condos saw a median price decrease of about 40% to $405,000 for the four sold.”
“Miami-Dade County has four years of luxury condo inventory – not including the glut of preconstruction condos being marketed for sale. Nearly 2,800 units are on the market asking at least $1 million, according to Condo Vultures Realty. In 2017, 681 luxury units sold in the county, meaning an absorption rate of about 57 units a month. About 152 luxury condos are under contract for an average asking price of more than $3.3 million, or about 1,100 per square foot as of Tuesday. The average closing price in 2017 was less than $2.4 million, or about $910 per square foot, according to the report. That’s 28 percent lower than the current average asking price.”
“According to Condo Vultures, there are nearly 47,500 units in the development pipeline in South Florida since the new cycle began in 2011. Developers, brokers and sellers in South Florida’s luxury condo sector have been forced to adjust their pricing, wait longer for units to sell and scour the globe for new buyers amid the luxury market slowdown.”
“The numbers are coming and they won’t be pretty. That’s what data-tracking realtor John Pasalis expects when the Toronto Real Estate Board issues its official February home sales statistics next week. Although prices appear relatively flat, house sales were down about 40 per cent over the last two weeks in the Toronto area compared to the same period in 2017, while condo sales dropped about 30 per cent, said Pasalis.”
“Even price drops such as the 4.4 per cent year-over-year decline that the Toronto Real Estate Board reported in January, are a result of statistics that are skewed by last year’s ‘out of whack’ Toronto region market, said Dana Senagama, an analyst with Canada Mortgage and Housing Corporation. ‘Yes, prices have started to slow down but it’s coming off an unsustainable peak,’ she said.”
“Real estate sales that now appear so disastrous compared to 2017 and 2016 are actually just returning to normal. ‘There was a bubble in the housing market. Speculative buying was rampant, especially in York Region, and York Region is the area that is getting hit the hardest,’ he said. ‘If you believe we have been in a speculative bubble, bursting those bubbles is never smooth,’ said Sheila Block, senior economist with the Canadian Centre for Policy Alternatives.”
“UK house prices have recorded their first month-on-month fall since August, according to the Nationwide. On Wednesday, estate agent chain Foxtons reported a slump in profits, saying that activity in the London housing market was near historic lows. Sam Mitchell, chief executive of estate agents HouseSimple, said: ‘House prices have gone off the boil, particularly in London, and activity remains subdued as we approach the crucial Spring period. Buyers are viewing but are not showing any urgency to offer.’”
“Real estate prices may have already begun to fall in this quarter as developers and agents prepare for slow business due to new visa rules, which restrict expats in Oman. A manager at Hilal Properties said: ‘Most expats cannot come to Oman for work because of the ban, so their numbers are down. Some expats are even returning to their countries, which is why a lot of properties are now on the market.’ She added: ‘For that reason, most owners are also reducing rents. This trend is apparent across Muscat.’”
“A representative from Taif Properties said: ‘Yes, it has had a drastic effect on real estate prices. We’ve even seen it in popular neighbourhoods such as Madinat Qaboos and The Wave. It is affecting all the places. Madinat Al Ilam, a villa that was rented for OMR1,500 in November, was rented for OMR900 this February.’”
“A drop in the number of houses available for sale is more likely a result of people pulling their properties off the market than a surge of sales, an analyst says. In February, there were 24,848 houses listed for sale, compared to 25,155 in January 2018, a drop of 1.2 per cent. It shows the number of houses for sale fell over the past month - down by 4.5 per cent in Auckland and 5 per cent in Wellington.”
“ASB economist Kim Mundy said, given how subdued sales activity had been recently, it seemed more likely that vendors were changing their minds about selling, than that there had been a rush of purchases. ‘Sellers withdrawing properties from the market is a natural response to the slowing in demand we have seen over the last six or so months. Those who do not need to sell are choosing to wait, rather than accept a lower than desired price.’”
“The Chinese economy managers have undertaken spring cleaning of the books of the debt ridden banks just days before the New Year Day. And slapped fines as frauds tumbled out of bank vaults. The Shanghai Pudong Development Bank, for instance, has been slapped a fine of $72 million (462 million yuan). The branch had long claimed to have ‘zero’ non-performing assets (NPAs) or bad loans. But in reality it advanced 77.5 billion yuan to 1,493 shell companies. Inspectors of the China Banking Regulatory Commission have found that the pile of bad debts could run to 10 billion yuan in losses.”
“Liaoning, the northeastern Chinese province bordering North Korea, reported an unusual 2.5 per cent drop in gross domestic product last year; it admitted cooking its books between 2011 and 2014 through forgery, tax refunds and taxation calendar adjustments. Another province, Inner Mongolia has revealed that two-fifths of the industrial production it reported for 2016 did not exist. The unvarnished truth from the above is what has been suspected all along that many, if not very substantial number, of Chinese provinces are exposed to what Xinhua reporter grandly terms as ‘house ugliness.’”
“Speculators are having a field day across China offering instant riches with a wide variety of pyramid schemes. The housing market has become a casino, as a New York Times headline puts. Real estate makes up nearly three-quarters of the assets of Chinese households. Average Chinese has no trust the country’s stock exchange. And has turned to the housing bubble to make a quick extra buck. Going by local media reports, a vast number of apartments in many cities are unoccupied. Many buyers have no intention of moving in or renting out; they bought them to sell once prices go up. In many cases speculators are said to have built homes that nobody wants.’”
That last link is a hoot:
‘The short point is that the unfolding months of the Year of the Dog may not provide the space President Jinping needs to restructure the economy with least pain. If any, it can complicate matters going by the mood in the countryside, which is often not in the radar of Beijing watchers.’
‘Like in the past, now also there are question marks on the quality of official statistics, as the New York Times said in early January, “the Chinese official figures have become implausibly smooth and steady, even as other countries post results with plenty of peaks and valleys”.
‘The problem has become compounded in the past few weeks with a host of provinces and counties publicly confessing to doctoring their accounts. Why did they talk up the economy? To please the masters in Beijing! It is not a new development. What is new is admission of the guilt as never before.’
‘Nikkei Asian Review attributes the rush of confessions to “Central government subsidies for coming clean”. A growing number of Chinese local governments are owning up to having faked economic data and are moving to correct their doctored numbers, responding to a major shift in Beijing’s economic policy toward the quality of growth, it says.’
‘Future thus may become rosy for number crunching. But what about today. Can we take the Chinese growth data on face value? My answer is a resounding no!’
Steaming piles of crow for Shanghai Dan!
Potemkin statistics
I wonder what stage of grief poor ol Dan is in.
‘Nikkei Asian Review attributes the rush of confessions to “Central government subsidies for coming clean”. A growing number of Chinese local governments are owning up to having faked economic data and are moving to correct their doctored numbers’
This would seem to be a significant turn of events. I wonder why the US media hasn’t said boo about it?
“Why did they talk up the economy? To please the masters in Beijing!”
When you have a massive state-run propaganda organ that censors subversive, discordant, or concerning information, pretty soon people start to self-censor. Censorship and punishment can lead to self-censorship, which it appears is what happened here. Rather than say the wrong thing, they just said what their superiors wanted to hear.
“A growing number of Chinese local governments are owning up to having faked economic data and are moving to correct their doctored numbers…”
We’ll probably hear about some executions next, as the government cleans house of these “liars” who were only following orders.
“Steaming piles of crow for Shanghai Dan!”
He was the biggest shill this blog has ever seen. The question I have is who was paying him to talk up China like that?
I went to Kunming, Yunnan last month. Our first AirBnB was in a highrise complex. Ten 30-story buildings, 12 units per floor…so 3,900 units. I estimated 10,000 people must live there and wondered what the morning “commute” would be like?
Hardly a trickle.
I estimate the complex was less than 50% occupied even though it was 10-years old and individuals owned all the units. Units “seemed” occupied, but upon further examination, many were mothballed or used as storage. It was weird.
The utility bills for each unit are taped to the lobby wall in each floor. Even though there were at least 12 units/floor, I never saw more than 4 or 5 utility bills on any lobby wall!
What were you doing way out there? My wife passed through there in January to head up into the mountains near the border to visit coffee plantations. I didn’t get to go because it was between trips for me.
Regarding the building…doesn’t sound surprising.
Visiting my nephew who teaches there. It’s a wonderful area. Very productive people.
I am headed to Shanghai next week for business.
There’s a video at this link:
‘Almost 1 million houses are under extreme mortgage stress’
Watched it. If this is what’s airing on Australian TV, it’s a wonder more people haven’t panicked so far.
Corr: “It’s not low-income houses necessarily, but in many cases middle to high-income houses… are the bit that are struggling right now.”
Host: “Ross, why are so many people finding their payments difficult to make?”
Corr: “Well it’s pretty obvious what’s happened with a lot of families, not only have they got big costs, so in other words rising health insurance premiums, rising electricity bills, but on top of that, many have taken on very big mortgages. Now if their wages aren’t growing fast, then quite clearly many are going to struggle if they suddenly find they’ve got big mortgage payments to try and cope with.”
So NOW it’s ‘pretty obvious’ and ‘quite clear.’ And the mortgage payments are ’suddenly’ big. Uh, if it was all so obvious and clear, how did it get out of hand in the first place?
No fixed rate mortgages in Oz, so that payment is probably also going up too.
They have $60 billions of interest only mortgages, almost all of it to investors. It should be noted a bunch of these people own multiple loans.
Multiple loans — were all the loans each collateralized by the same single warehouse full of garlic?
“Watched it. If this is what’s airing on Australian TV, it’s a wonder more people haven’t panicked so far.”
This is the way the world ends. Not with a bang but with a whimper. —T.S. Eliot
Realtors are liars.
…. and every closing a crime scene.
So much creative genius in your posts!
DebtDonkey
Greenwood, FL Housing Prices Crater 28% YOY As Subprime Mortgage Meltdown Continues
https://www.movoto.com/greenwood-fl/market-trends/
Colorado is full. Please go home:
https://www.bizjournals.com/denver/news/2018/03/01/denver-area-growth-control-measure-gets-go-ahead.html
CA was the same way years ago ” go home we are full up” Now its Colorado’s turn. have fun
That probably drives demand up even more. It’s like keeping a line out in front of the nightclub.
It certainly limits supply, which will drive prices up.
All the tree huggers in Marin County (north of San Francisco) got together in the 70’s and passed a ballot initiative to rezone 1000s of acres into open space nature preserves. The end result 4 decades later is housing prices have sky rocketed and their children cannot afford to buy property.
Oh, there’s plenty more land out by the airport (where I travel to for work every few months)! I can’t believe the new houses out there crammed right next to eachother, without a tree in sight for miles.
Land availability isn’t an issue, though the east side (by the airport) is not considered desirable. The problem is WATER. About a quarter of Denver’s tap water comes from aquifers, and those are drying up. Monitoring the snow pack is something that is reported in the news here. Consecutive low snow pack levels could mean water rationing. Doubling the population on the Front Range is a sure fire guarantee of future water rationing.
As for the lack of trees around the airport, well, locally grown trees are expensive, as they take long to grow, due to the shorter growing season, and that area is prairie, so no pre-existing trees there. A sapling that would cost say $80 in Texas can cost $400 here, and importing them from the cheaper sun belt usually doesn’t work as the trees often fail to survive the first winter.
Cape Town water crisis coming soon to a city near you.
“Oh, there’s plenty more land out by the airport…”
Seems like it’s always windy too.
Colorado is full. Please go home
That’s going to put a damper on Amazon choosing Denver for HQ2. Not that I think that Denver had a snow ball’s chance in hell to begin with.
I’m surprised that these Westerners haven’t invaded the East yet. Tons of empty land, tons of water, tons of roads with not many cars on them, tons of medium-sized that could easily be revitalized, tons of cheap housing that needs only $30K of fix-up (if folks would stoop to live a 20th century house).
But no, it seems the employers want their “vibrant” cities pre-made for them. Then they can pony up for the privilege.
“Westerners” hate humidity.
And big bugs 🐜
+1000 to both
“Westerners” hate humidity.
Humidity means water is present. The West has very little.
It has drought (age old) and no water.
If they hate the humidity, then why are they flocking to Oregon or Washington? Those places are temperate rain forests.
Who is they? Californians? I don’t know anybody else flocking to those areas.
‘Miami-Dade County has four years of luxury condo inventory – not including the glut of preconstruction condos being marketed for sale. Nearly 2,800 units are on the market asking at least $1 million, according to Condo Vultures Realty. In 2017, 681 luxury units sold in the county, meaning an absorption rate of about 57 units a month. About 152 luxury condos are under contract for an average asking price of more than $3.3 million, or about 1,100 per square foot as of Tuesday. The average closing price in 2017 was less than $2.4 million, or about $910 per square foot, according to the report. That’s 28 percent lower than the current average asking price.’
‘According to Condo Vultures, there are nearly 47,500 units in the development pipeline in South Florida since the new cycle began in 2011.’
Cycle? Jeebus this inventory is a calculator breaker. These condos will be torn down before they sell at this rate.
Oh, and note Peter has gone back to condo vulture from crane spotter.
Miami :
“About 152 luxury condos are under contract for an average asking price of more than $3.3 million.”
Impressive. Miami is losing its fresh water aquifer. Think about the real estate that’s going to go up in smoke by 2100. Salt water intrusion is an issue for Key Biscayne now.
Pfft. It’s sitting right on an inexhaustible body of water - the Atlantic Ocean. Better start thinking about a bigger desalination plant.
‘Even price drops such as the 4.4 per cent year-over-year decline that the Toronto Real Estate Board reported in January’
Ah yes, good old UHS. What about the 30% spike up after January 2017?
‘The median price for the area was down just under 2% from December 2016 to $1.451 million. The 90039 ZIP code, which includes parts of Silver Lake, Los Feliz and Atwater Village, had 20 home sales in December for a median price of $956,000, about 6.7% lower than the previous year. Condos in 90039 saw a nearly 20% drop in median price from last year to $728,000 for the five sold. Los Feliz saw 10 homes sell in the 90027 ZIP code for a median price of $1.43 million, roughly 17% lower than the previous December. The area’s condos saw a median price decrease of about 40%’
Oh dear…
Maybe Jingle can console these FB’s with how great airboxes and shacks are for investing.
No consolation from here. These guys have been buying at the top. The consolation comes from buying at the bottom.
Latest incarnation of “I Love LA” - hipster alert:
https://www.youtube.com/watch?v=JR6n23_fL3o
The yout’ both frighten and amuse me.
Uber, Lyft Drivers Earning A Median Profit Of $3.37 Per Hour, Study Says
The vast majority of Uber and Lyft drivers are earning less than minimum wage and almost a third of them are actually losing money by driving, according to researchers at the Massachusetts Institute of Technology.
https://www.npr.org/sections/thetwo-way/2018/03/02/590168381/uber-lyft-drivers-earning-a-median-profit-of-3-37-per-hour-study-says
Surprisingly …
“Uber and Lyft both have “notoriously high” turnover rates among drivers. A report last year said just 4 percent of Uber drivers work for the company for at least a year.”
Nothing like prematurely wearing out a $30K car to nullify any income generated.
It was interesting to me that I hear an Uber ad on Spotify during my run this evening. The ad wasn’t for Uber the service, it was an ad to recruit Uber drivers. The voice was all cheerful and said something along the lines of, “I drop my kids off in the morning and then I work on my terms, mostly taking people to and from the airport. I’m trying to save up for travel of my own.”
We should call Uber and Lyft drivers what they are: employees. Uber and Lyft will never work in it’s current incarnation. It will need to take the human out of the equation and make them self-driving fleets. In the meantime, these contract drivers are getting a raw deal.
“…these contract drivers are getting a raw deal.”
One they freely agreed to.
OAM,
The exact same ad plays on the radio station in the DC area. The specific ad copy is nauseatingly perky and chirpy. (Paraphrase because I don’t remember it all.)
—————
“Meet ‘Mary,’ she’s a mom, and she’s planning to earn a little extra. She’s already taken her kids to school, and now she’s headed to the airport to drive the visitors who are in town for the big game. She’ll earn so that she and her kids can do a little extra something on their own next vacay.”
—————
Yes, they used the word “vacay.” And from the wording, there’s a hint that Mary is a single mom who needs a little extra cash.
“…these contract drivers are getting a raw deal.”
“One they freely agreed to.”
Perhaps, but it is unlikely that they really know what they are signing up for. These companies should be required to disclose wages on what drivers actually earn, including wear and tear depreciation of vehicle. Markets work when there is adequate information. When people are being unwitting dupes then things break down.
It is interesting to note that in the UK there are 3 categories of workers: employees, the self-employed, and an intermediate category known as a “worker”. Workers still get some rights, including a minimum wage. I think something of a distinction like this in the US would be useful for these gig drivers. If the job market continues to be what it is, the problem could resolve itself. I’ve read reports that the driver churn is creating problems for the company. I wonder if there will ever become a point where they (Uber, Lyft, etc.) decide that the want to have employees so that they can control schedule and fit it to demand.
The real cost must be the car depreciation and fuel. Once the self driving car is in place, the cost will go up as fleet owners won’t put vehicles into production at a loss…..or even $3.25/hour.
Maybe. I’ll let the automation geniuses figure this one out, or let their business model die trying. the $3.25 cut that was computed surely didn’t include the profit taken by Uber, nor would it include fuel costs if the vehicle were fully electrified. There would be other ways to monetize the ride (such as showing ads occasionally on the rip). I’m guessing that once you factor in those benefits, you get closer to $6-$7 per hour for the companies. But it should be noted these would be almost 24/7 cars fleets, not an 8-hour workday. If you design the cars AI correctly, you could easily exceed useful vehicle life of a typical ICE car being purchased by a consumer. I’m inclined to believe that self-driving car fleets will be a goldmine for whoever can figure it out.
Perhaps, but it is unlikely that they really know what they are signing up for.
To me it’s the same model as pizza drivers (except a nicer car is required) and nobody seems to worry about them. Yes, it is not sustainable to sell the car a mile at a time, but it can get you through a bad month.
As I’ve said from the beginning - it’s a business model which preys upon people who cannot perform remedial math. They end up broke with a burned out vehicle worth next to nothing, if they don’t figure it out sooner than that.
But like PT Barnum said - there’s a sucker born every minute, and these suckers seem a dime a dozen. “Independent contractor” is the new slave labor.
More like, it preys upon poorer people who can’t make ends meet any other way. They probably *did* do the math. They know they’re killing the car, but 3 bucks an hour is better than no bucks an hour. They’re better off selling the car for cash up front (before it gets trashed) and riding a bike to a McD’s job.
The real suckers are the drivers that the radio and TV ads depict: upstanding middle-class people who are doing okay, but they “earn” on their free time for a little extra cash.
On the other hand, I know a handful Uber drivers who are independently wealthy. They don’t drive for the money, they drive because it’s a hobby, they are lonely (though they won’t admit it), and they meet interesting people.
‘The vast majority of Uber and Lyft drivers are earning less than minimum wage and almost a third of them are actually losing money by driving, according to researchers at the Massachusetts Institute of Technology.’
‘A working paper by Stephen M. Zoepf, Stella Chen, Paa Adu and Gonzalo Pozo at MIT’s Center for Energy and Environmental Policy Research says the median pretax profit earned from driving is $3.37 per hour after taking expenses into account. Seventy-four percent of drivers earn less than their state’s minimum wage, the researchers say.’
‘Thirty percent of drivers “are actually losing money once vehicle expenses are included,” the authors found.’
‘Both Uber and Lyft have been fighting legal battles for years against initiatives to classify their drivers as “employees” instead of “independent contractors” — meaning drivers don’t receive benefits like health care or sick leave.’
To be fair to Uber and Lyft, those drivers aren’t traditional employees. It’s not like an office, where people depend on you being there at a set time. Drivers choose when they make themselves available to work. So why would drivers need paid sick days? If you’re sick you just switch off that day. True piecework.
But this is just a very visible example of the larger problem: pay and bennies are designed for full-time or at least consistent employees, but the economy is shifting back toward piecework.
Hey Donk
OK OK… I did promise…
https://imagesvc.timeincapp.com/v3/mm/image?url=http%3A%2F%2Fcdn-image.foodandwine.com%2Fsites%2Fdefault%2Ffiles%2Fstyles%2Fmedium_2x%2Fpublic%2Fcheetos-popcorn-at-regal-ft-blog1217.jpg%3Fitok%3DEf1m3_HW&w=700&q=85
Housing Donk housing.
Kensington, MD Housing Prices Crater 5% YOY
https://www.movoto.com/kensington-md/market-trends/
The exact same thing is true for Amazon Flex (delivery) drivers.
They all would be better off working for the minimum wage at Walmart or any local fast food joint.
And their car wouldn’t wear out so fast either.
And when they get into an accident and their insurance company finds out they’re taxis they will refuse to pay.
Years ago, a friend of mine do some legal pro bono work with some small time, busted, Pot sellers.
He said they would make more working at McDonalds then they do selling pot. Without the arrest risk. He said they made VERY little.
Interesting… because IIUC, selling harder stuff like coke did *very* well, e.g. Scarface.
Guy I worked with drove for Lyft after he was laid off. He said it helped pay for Groceries, but didn’t see how you could live off of it. He said it was fun to do - met a lot of interesting people, but gave it up once he found full time work.
He was driving his M-I-L car. She had moved in about a year before he was laid off and didn’t drive anymore. The car was spare sitting in the driveway.
So maybe it works when you’re selling someone else’s car a mile at a time.
Uber, Lyft, Amazon, crApple, Freakbook…. all unprofitable and failing companies.
Brookfield, MA Housing Prices Crater 6% YOY On Falling Appraisals
https://www.movoto.com/brookfield-ma/market-trends/
Our school system is having a hard time finding bus drivers at $12/hour. Seems like a no brainer to get a CDL and use the counties bus vs. your own Prius.
Our school system is having a hard time finding bus drivers at $12/hour. From what I’ve been reading about the current generation of school bus passengers, that is not nearly enough to justify the aggravation & physical danger.
‘Rockwood Capital and Thor Equities are selling an Upper West Side building they co-own for a loss. The pair, which purchased the 70-unit rental building at 838 West End Ave., on the corner of West 101st Street, four years ago for $67 million, are unloading the property to Emerald Equity Group for about $65 million.’
‘Thor, a real estate investment firm controlled by Joe Sitt, has suffered several blows in recent months, mostly involving its expansive retail portfolio in the city…According to a report in the Real Deal, the firm also just lost its ownership interests in three high-end retail properties it co-owned with the public real estate company GGP…after Thor failed to pay back a loan from GGP, the Real Deal reported.’
‘Sitt has put at least 10 properties up for sale over the past year in what appears to be an effort to raise cash.’
Ed Hyman (Evercore) discusses possible trade retaliation;
“I did not expect this…I find it really scary….Its pretty bad”
https://www.bloomberg.com/news/videos/2018-03-02/evercore-isi-s-hyman-sees-prospects-of-a-trade-war-as-really-scary-video
“Oxide”
“In the late 19 th century, the Harrison administration was actually worried that the US had *too much* money from all the Tariffs. Of course, this was the Gilded Age when gov spent almost no money on social services.”
“Anyway, Hillary herself mocked Trump in one of the debates for using Chinese steel. So surely even she supports the tariffs as well, right?”
Surprise! The globalist Bloomberg finds a globalist to use the word “scary!” Come on Ed, stamp those feet. Stamp em’!
Well, if you assume that no other country will retaliate then everything should be fine right…All the benefit flows to the USA at no cost…OTOH, if they do retaliate, then someone, somewhere in America is going to pay the price for it…We shall see…Its only day two…
When you are running huge trade deficits, you have more to gain than lose. I can remember when we didn’t do this “free trade” stuff. Why one of the biggest TV manufacturers was in Texas.
The modern globalist set up simply alloweds labor abuses off-shore along with US job loss. Plus these countries pollute like crazy. Globalism is a race to the bottom, and when one guy finally tries to do something about it, the globalist media sets their hair on fire. Well tough cookies. We had globalism crammed down our throats for 40 or 50 years and it failed. It’s time to try something different.
I don’t disagree with anything you said here Ben…Remember, I said, I voted for Perot and he was correct…IMO, Now, trying to get the horses back in the Barn is not going easy or painless…That is, unless we think that the effected countries will not do a eye for an eye…
Davey, what horrible thing do you imagine China would do to the US that would poke our eye out?
what horrible thing do you imagine China would do to the US that would poke our eye out ??
Sell the US bonds they own and not buy anymore among other things.
….. which means debt rates go to 12%-15% which creates jobs and accelerates the economy.
Sell the US bonds they own…
Good point. I hadn’t considered the fear of debt angle. Ironic Dave.
He voted for Perot because “he (Perot) was correct,” however when Trump does it it’s “scary.” See what’s going on here?
And what would that be Grasshopper ?
The world didn’t end when Trump put tariffs on Solar panels in January. Easy win. Level the field and all that.
“After Trump tariffs, Chinese solar company says it will build U.S. factory”
http://money.cnn.com/2018/01/30/news/economy/jinko-solar-us-china-trump/index.html
Probably high tech software ? I mean what do we make here anymore anyway ?
Cars & Planes….
I mean what do we make here anymore anyway ?”
Wait, answer coming over the teletype …
K.a.r.d.a.$.h.i.a.n … Stop … $.e.l.f ……………. ?????
Sorry, my 9600 baud rate modem is stuck in a phase lock loop
And movies. Few countries beat the Americans for high-box office movies and TV series. Hollywood isn’t making cookie cutter superhero movies for us — it’s largely for the Chinese market.
We make blood:
GARCIA: Charles is saying that our exports are tremendously varied. To get a sense of this, consider the top three categories of goods - so physical things, not services - that we export. Those are refined oil products, cars and airplanes. Put them all together, and they still only add up to about 11 percent of the value of all goods we export. And you don’t have to search far down the list to start finding some surprising stuff.
KENNY: 1.4 percent of what the U.S. exports of stuff is blood. We turn out to be…
GARCIA: Blood?
KENNY: …A world leader in blood exports.
GARCIA: Like, human blood?
KENNY: Human blood.
KENNY: Absolutely. Human blood products - so plasma, for example. One reason is - a couple of reasons. One is, in Europe during the mad cow outbreaks of a few years ago, people were worried that we couldn’t screen that out of blood supplies. And so a lot of blood plasma was exported from U.S. to Europe. And that sort of continued. Another is frankly that, in the United States, unlike most places, you can pay people for making donations of plasma and blood. And so there are a whole load of car accident victims in the United Kingdom and France who, you know, wouldn’t be alive today if it wasn’t for the fact they’ve got U.S. blood circulating in their veins. I think it’s a good news story.
GARCIA: And all this variety - the blood and the stuff Kenny mentioned - that’s good because it’s healthy that the country isn’t really dependent on any one thing it sells abroad. But, he says, our exports themselves are dependent on something - they’re dependent on imports.
https://www.npr.org/templates/transcript/transcript.php?storyId=589595792
What would Homesteading do to real estate?
https://www.marketwatch.com/story/what-history-teaches-us-about-who-wins-in-trade-wars-2018-03-02
https://www.reuters.com/article/us-usa-trade/trade-wars-are-good-trump-says-defying-global-concern-over-tariffs-idUSKCN1GE1PM
‘The United States is the world’s biggest steel importer, buying 35.6 million tonnes in 2017. Canada is the leading supplier, accounting for 16.7 percent, followed by Brazil at 13.2 percent and South Korea at 9.7 percent.’
‘Although China accounts for only 2 percent of U.S. steel imports, its massive industry expansion has helped produce a global steel glut that has driven down prices.’
“China urges the United States to show restraint in using protective trade measures, respect multilateral trade rules, and make a positive contribution to international trade order,” Chinese Foreign Ministry spokeswoman Hua Chunying said.’
Stamp em’ Hua, stamp em! BTW, there’s the G word again.
I have to say that I largely agree with Ben. We need to take a more nuanced approach to trade. There have been many academic articles by prominent economists that are starting to view free trade with more skepticism. The basic conclusion is that the benefits of tree trade are diffuse, and the costs are concentrated. But if you are living in any of the cities that are decimated by trade deals, in many cases they don’t bounce back. It creates a permanent negative spiral. And we’ve seen that follow with mass unemployment, increased dependency on social safety nets, drug scourge, etc.
We need to think about trade
As long as we are talking about tariffs, I would be fine with restricting foreigners from purchasing homes in the US or increasing the taxes for such purchases. Some of the hottest Canadian cities are figuring out that this is a way to curb illegal money and speculative demand from overheating the local markets.
Off topic…but when is the big military parade for Trump?
He is trying to choose which one he wants;
https://www.youtube.com/watch?v=FTNs9aPt2pg
https://www.politico.com/story/2018/02/23/trump-military-parade-veterans-day-423405
Putin disinvited himself to the viewing balcony @ 1600 Pennsylvania ave, has the tool he needs to kick.our.arse. Stud.man Putin even has a video for all Americans to entertain the certain destruction of all the U$A military budget monie$ currently being expended, (those slaughtered Russian mercenaries in Syria knot included in the new Russian military future of weapon$ $uperiority)
Right after the parade of “dreamers” marching back to Mexico.
Contrary to #MuhNarrative, 25% of them are functionally illiterate.
I also love how they all claim to not speak Spanish, broken English with a heavy accent.
The whole “Dreamers are wonderful” narrative fell apart when Trump agreed with the narrative and offered to make those wonderful Dreamers legal… as long as they could never chain-migrate in their not-so-wonderful parents for Uncle Sam’s cheesechecks. Suddenly, those Dreamer med-students and entrepreneurs in their mid-20s became “children” who still needed their Mommy.
Going by local media reports, a vast number of apartments in many cities are unoccupied. Many buyers have no intention of moving in or renting out; they bought them to sell once prices go up.
I’ve had a few conversations in China where I laugh because they paid (or think they could sell) some Shanghai apartment for big bucks (close to a million USD) yet they rent it out for less than 2 grand a month and the repairs are continuous or else it’s falling apart quickly. When I point out that they aren’t making anything on their investment they think I’m stupid. OBVIOUSLY it’s about the appreciation, not the rent. After the run they’ve had for the last decade or so I suppose it seems obvious.
Shanghai apartment for big bucks (close to a million USD) yet they rent it out for less than 2 grand a month ??
Awhile back I spoke with a Chinese national that happens to also be a real estate broker and asked him why the Chinese seem to be so willing to pay these stratosphere prices for real estate here…His answer was; “They like to gamble”…
Haven’t we figured out that gambling with a necessity of life like housing is dangerous, amoral and leads to bad things?
buy a house and hit the lottery!
“OBVIOUSLY it’s about the appreciation, not the rent.”
Hmmmm … this philosophy flows over and affects stock prices (It’s about appreciation, not earnings - or even sales) and cybercurrencies (It’s about appreciation of sumptin’ made out of nuthin’).
e repairs are continuous or else it’s falling apart quickly. When I point out that they aren’t making anything on their investment they think I’m stupid. OBVIOUSLY it’s about the appreciation, not the rent. After the run they’ve had for the last decade or so I suppose it seems obvious.
Even the tax code unintentionally encourages bubble-like asset inflation with its preferential tax rate on capital gains.
Kenmore, WA Housing Prices Crater 38% YOY As Seattle Area Slips Into Recession
https://www.movoto.com/kenmore-wa/market-trends/
You’re always good for a laugh, Haystacks.
Hello my good friend.
Keller, WA Housing Prices Crater 15% YOY As National Housing Demand Falls To 21 Year Low
https://www.movoto.com/keller-wa/market-trends/
Double laugh! Nobody in the entire state even knows where that is!
Hello my good friend.
Leesburg, VA Housing Prices Crater 13% YOY As DC Area Meets Housing Correction
https://www.movoto.com/leesburg-va/market-trends/
From the UK article - “mortgage approvals declined to their weakest level for three years in December, at just 61,000.”
Yikes.
“A drop in the number of houses available for sale is more likely a result of people pulling their properties off the market than a surge of sales, an analyst says…the number of houses for sale fell over the past month - down by 4.5 per cent in Auckland and 5 per cent in Wellington.”
Their vacancy rate just dropped through the floor. It’s a shortage of Inventory. Must need to build more?
buying a house is your best chance of hitting the lottery via free home equity.
You basically get paid to have a roof over your head.
Staying in Boca Raton for the week and have seen some new apartment complexes that start at … drum roll…about $3K mo. In one case, this will put you a few hundred feet away from a very active rail line (a good amount of freight traffic in addition to commuter), think of the scene from “My Cousin Vinny.” It’s too much to bear. I looked at the lights at this Taj Mahal and it looks about 25% occupied or less
The air pollution near rail lines is very bad.
The air pollution near rail lines is very bad. How does that compare to the pollution near interstate highways with a lot of interstate semi truck traffic?
Is it a ‘luxury’ complex? Does it have a bocce ball Court and hop scotch area next to that rail line?
You’re giving me visions of wealthy retirees playing hopscotch. Not good.
Anytime I see these active senior Boomers doing kids things it reminds me of the Beastie Boys song Boomin Granny, a song about young guys picking up senior citizens. Many years after the songs release it still makes me laugh.
San Diego, CA 92037 Housing Prices Crater 6% YOY As Housing Correction Expands In Southern California
https://www.zillow.com/san-diego-ca-92037/home-values/
*Select price from dropdown menu on first chart
JOSHUA TREE (CBSLA) — A Joshua Tree couple is being held on child-cruelty charges after officials found three teens living in a plywood shack.
http://losangeles.cbslocal.com/2018/03/01/teens-found-living-in-a-box/
My goodness, he’s living on his own property.”
It’s the tiny house movement!
he wasnt paying enough property taxes. they must want him out for some other reason.
“My goodness, he’s living on his own property.”
But he’s not leaning against the “yolk of debt.”
It’s illegal to be poor, dontcha know? Sad.
Alameda, CA Housing Prices Crater 10% YOY; Mortgage Fraud Rampant
https://www.movoto.com/alameda-ca/market-trends/
Anyone here along the upper half of the East Coast experiencing any of that “bombogenesis”? I was watching some of the videos and pics. Lots of flooding, and big old trees down. Must be quite a storm.
And about midnight eastern time is when the tide peaks, so the worst damage will be occurring overnight. I watched the late national news tonight, and of course they had a CBS reporter right on the MA coast getting blasted.
Scituate always seems to get hammered. Even Quincy is getting some nasty flooding. OTOH, people like to live near the water and are always shocked, I tell you, SHOCKED when it floods.
Nor’easter takes aim with rain, damaging winds, snow
By Jim Shay and Tara O’Neill Updated 9:39 pm, Friday, March 2, 2018
https://www.greenwichtime.com/weather/article/Nor-easter-takes-aim-with-rain-damaging-winds-12722262.php
I’ll have to call my sibs tomorrow and see how they made out.
I’m quite a bit inland and all we got was 18 in of premium heavy snow.
Spring is almost here!
Lol, inland. Inland Sea. Yah, I heard 20 inches in Rochester. Yep, we always used to dig under the snow for the crocuses.
Are you enjoying the calm before the economic storm?
im expecting a big inheritance soon. Where should i invest?
do u think the tax cuts and low rates can enable corporate america to keep stocks levitating longer so they can cash out options?
“im expecting a big inheritance soon.”
Such a sad thing to say in so many ways.
How do you walk back a threat to quit in case you don’t get your way?
U.S.
Gary Cohn’s Future Unclear After Setback on Tariffs
Adviser failed to stave off Trump’s announcement on steel and aluminum
By Peter Nicholas and Michael C. Bender
March 2, 2018 7:11 p.m. ET
On Wednesday night, White House economic adviser Gary Cohn privately told colleagues that if President Donald Trump signed an order the next day slapping foreign countries with broad tariffs, he might have to quit.
But after an intense battle within the White House, Mr. Trump went ahead with his tariffs, announcing them in a meeting with steel and aluminum industry executives on Thursday morning. While Mr. Trump didn’t formally impose new tariffs then and there, he said he would do it the following week, rejecting concerns…
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I live in Riverside and the prices out here are ridiculously high for what the medium income is. We had a house sell on our street for close to 400k when just 4 Year’s ago we bought ours for 190k and just last year going for the low 300’s. It’s a handyman special renovation with mistakes everywhere and the finish work looked like they had no clue what they were doing. No curb appeal whatsoever and they just dumped a bunch of sand in the backyard which the neighborhood cats love. This is 2006-07 all over again. My wife and I make well over a 100k and I’m thinking we couldn’t afford it and still have savings or a college fund for our kids. It’s unreal!
the business cycle has been replaced by the FED bubble cycle.
the business cycle has been replaced by the FED bubble cycle.
The “business cycle” is entirely a creation of the Federal Reserve and fractional reserve banking. Without these two things, businesses and bankers wouldn’t get their signals mixed up (thinking there was more demand for certain goods, and the spending money to support the purchases of them) due to all the funny-money floating around.
Kailua, Hawaii Housing Prices Crater 16% YOY As Housing Demand Caves
https://www.movoto.com/kailua-hi/market-trends/
HUGE home for sale Record prices…..hahaha
https://www.mercurynews.com/2018/03/02/sunnyvale-home-shatters-new-record-with-enormous-price-tag/