A Feeding Frenzy Changing To Buyers’ Remorse
A weekend topic starting with the Holland Sentinel in Michigan. “With inventory down and the number of buyers on the rise, the West Michigan housing market continues to remain red hot heading into the middle of the summer. Briana Beyer, local realtor for Coldwell Banker Schmidt, said that for her clients, it is currently a blitz to be the first through the house and from there, it is generally about putting in an offer over the asking price while also adding different stipulations to the offer to sweeten the pot. ‘It is a wild market to be honest,’ Beyer said. ‘If you are a buyer and you are not able to see that home in the first or second day, you have no chance.’”
“When looking to buy homes in the under $200,000 range, both Beyer and real estate broker Dave DeYoung, also of Coldwell Banker Schmidt, said they use tactics like asking above asking price, waving the appraisal, making cash offers and in extreme cases waving the inspection just to help clients improve offers. ‘If you can’t use cash, you have to be creative when you write up and offer,’ Beyer said. ‘You have to word things and have the correct verbiage. Some people are foregoing appraisals. … Even some, and I don’t recommend this but some are doing no inspections. People will accept the house as is.’”
“The tricky thing is that although the market is hot right now and has been for a period of time now, there is no way to tell how long it will remain the way it is. ‘There has been talk that we are on a bubble and how we don’t know how long this will last and how high prices can get but all we know is that it is strong right now, it is a good time to buy and it is a good time to sell,’ Beyer said. ‘Last year, it kind of felt like we were going on a bubble and yet we are still here. It’s hard to say and it’s hard to predict.’”
From the Dallas Morning News in Texas. “Dallas-Fort Worth is one of the markets with record-high home costs. Home prices are rising to the point that there’s a lot more talk about another housing bubble. CoreLogic surveyed long-term home price trends in 390 U.S. markets. ‘What we found in our most recent calculation is that 32 percent of these metros look a little bit overheated — a little bit frothy,’ Frank Nothaft, chief economist with CoreLogic said. ‘The last time [it was 32 percent] was 15 years ago, during the in the spring of 2003. We know how that story turned out.’”
“Nationwide home prices are almost 7 percent higher than a year ago. And the average long-term mortgage cost has risen by seven tenths of a percentage point interest compared with this time in 2017, according to CoreLogic. ‘That translates into a 16 percent increase in the monthly principal and interest payments to buy the same house,’ Nothaft told a meeting of the National Association of Real Estate Editors. Nothaft said the prices on lower-cost homes are rising even faster than the overall market — up almost 9.3 percent year over year — along with higher mortgage rates. ‘That’s a 19 percent increase in the principal and interest payment in just one year,’ he said.”
“D-FW is one of the U.S. markets CoreLogic thinks is overvalued for home prices. However, Nothaft doesn’t think there is a nationwide price bubble yet. ‘But if we continue to see relatively rapid growth of home prices over the next few years, then we might be entering a period when home prices can no longer be sustained,’ he said.”
From the Lima Charlie News. “Effective July 1st, Freedom Mortgage, one of the largest U.S. home lenders, will be unable to make loans insured by the Department of Veterans Affairs. This restriction is part of a crack down on ‘loan churning,’ a practice of convincing veterans to refinance by barraging them with mortgage-refinance solicitations. This predatory behavior includes tried-and-true scams like using teaser rates and zero-down offers to tempt veterans into variable rate mortgages, as well as more creative ploys like disguising marketing materials to make them appear to be communications from the Department of Defense.”
“Freedom Mortgage is a nonbank lender, a.k.a. an independent mortgage company, that can lend funds with an added margin for profit because it has its own source of funds and is not a bank. Before the mortgage meltdown, nonbank lenders comprised just 19% of the U.S. mortgage market in 2007. However, just over ten years later, these self-styled lenders now make up over half of U.S. home loans. The reason for this expansion is that nonbanks are not subject to the array of regulations issued by the federal government and the Federal Reserve in the aftermath of the financial crisis. They are instead regulated at the state level.”
“Wall Street is also getting in on the action, funneling $345 billion to nonbanks between 2010 and 2017. Nonbanks like Freedom Mortgage rely on U.S. taxpayers for 80% of their mortgages through Ginnie Mae — a government-owned company established in 1968 to help people afford home ownership. Ginnie Mae issues mortgage backed securities as bonds to the market, which investors can then purchase. Then Ginnie Mae takes the money invested and loans it to businesses like Freedom Mortgage. Freedom Mortgage can issue mortgages, which are backed through Ginnie Mae with, unlike similar mortgages issued by Fannie Mae and Freddie Mac, the ‘full faith and credit of the United States.’”
“‘We have depended on sheer luck,’ said then Ginnie Mae President Ted Tozer when describing Ginnie Mae operations at a business summit. ‘Luck that the economy does not fall into recession and increase mortgage delinquencies. Luck that our independent mortgage bankers remain able to access their lines of credit. And luck that nothing critical falls through the cracks…’”
“The FHA was administered by Acting Commissioner Dana Wade until last month. Late in April, she testified in a hearing before the U.S. House of Representatives, and warned of ‘certain trends and indicators of potential defaults.’ She warned of increasing mortgage delinquency among FHA-insured borrowers, increases in the percentage of borrowers spending over 50% of their income on their mortgages, and increasing levels of debt for these borrowers, all of which are outlined in a March report by the FHA.”
“The American Enterprise Institute report highlights how the other safeguard for the taxpayer, a requirement that those seeking home loans pay 3.5% of the home’s purchase price up front, is breaking down. ‘It is stunning that the median dollars of down payment for FHA purchase loans has declined from $4,000 in January 2013 to $3,900 in January 2018, while the median sales price has increased by 24% over the same period,’ said Edward Pinto, co-director of the American Enterprise Institute’s Center on Housing Markets and Finance.”
From KPTV in Oregon. “Residents in a quiet Tigard neighborhood say they are frustrated after a drug house was bailed out of foreclosure by the state. In the past five years, police say they have responded to nearly 600 calls at the home on Southwest Gentle Woods Drive, and have seized hundreds of syringes and prescription drugs. In last few weeks, there have been two police calls to the home. Tigard police say officers raided the house twice in the past eight years and recovered everything from ecstasy and heroin to hundreds of syringes and prescription drugs.”
“Within the last three years, police confirm they’ve made at least 16 arrests at the home for outstanding warrants. The home recently went into foreclosure, but the state bailed it out, according to a spokesman from Oregon Housing and Community Services. The spokesman says the homeowner received help through the Hardest Hit Fund program, which has been helping families since 2010. The state is not required to do a background check. A spokesman says if federal agencies were to conduct more thorough criminal screenings, it could fall under fair housing issues and discriminate against communities of color and keep minorities from owning homes.”
“FOX 12 spoke with a woman who lives at the home about the abatement plan, to give them a chance to voice their side of the story. ‘Oh, that’s been taken care of,’ she said. ‘Everything has already been taken care of, there’s a little bit of a misconception in the neighborhood as to the reality of the situation.’ Neighbors don’t necessarily agree. ‘A misconception about what?’ Charlotte Haines said. ‘It’s very obvious.’”
The Press Democrat in California. “Home prices rose to new highs in Sonoma County in May, when the median hit a record $692,250, but there are indications the unrelenting price increases may be starting to test buyers’ limits. Over the past six years, the median price has more than doubled, climbing from $329,000 in May 2012. Last month, the median jumped nearly 11 percent, compared to a year ago. Before the crash, the median price hit a high of $619,000 in August 2005, then plunged to a low of $305,000 in February 2009. The 2005 high wasn’t surpassed until March 2017, when the median hit $635,000. New record prices since have been set six more times — before May, the most recent occasion was in February at $689,000.”
“Bill Facendini, president and broker of Terra Firma Global Partners in Santa Rosa, said in the past three months a significant number of sellers have reduced prices of properties after failing to initially land buyers. Sellers typically try to keep raising prices above what their neighbors obtained in recent sales, he said. But buyers these days seem less inclined to pay the higher amounts. ‘They don’t feel that need right now,’ Facendini said. He called it a sign that the market is in transition and price appreciation could slow, if not level off.”
“Lisa Thomas, an agent with Pacific Union in Santa Rosa, said buyers seem more cautious about overpaying. Also, those that have been looking since winter now have more choices, as additional homes have come to market this spring.”
From Inside NOVA in Virginia. “Sellers and prospective buyers at times had a difficult mating ritual in May across the Northern Virginia real estate market, with the result being a year-over-year decline in overall sales. One trend popping up across the region? Buyers are coming into the market with a ’stop-and-go mentality,’ said Gary Lange, managing broker of the Vienna office of Weichert, Realtors.”
“Clients are ‘hot and heavy’ when they begin the search for a new home, then go cold quickly, Lange said. ‘Some of that may be due to a lack of inventory, they are looking for a deal, or they just don’t have a serious need to buy,’ Lange said. That lack of inventory created a feeding frenzy earlier in the year, but the dynamics are changing slightly, with cases of buyers’ remorse impacting the market.”
“‘Sometimes buyers have successfully bid for a home, then realize the home really isn’t for them or they paid to much,’ Lange said. ‘It is easy to get caught up in the moment when a buyer makes a hasty decision about a home for fear of losing that opportunity.’”
“Buyers feeling trapped after signing a purchase agreement at times have been backing out over minor home-inspection issues, said Lange, who suggested those in the industry needed to step in and have all parties focus on the big picture. ‘Agents must counsel buyers and sellers about the way the housing market works,’ he said.”
‘Effective July 1st, Freedom Mortgage, one of the largest U.S. home lenders, will be unable to make loans insured by the Department of Veterans Affairs. This restriction is part of a crack down on ‘loan churning,’ a practice of convincing veterans to refinance by barraging them with mortgage-refinance solicitations. This predatory behavior includes tried-and-true scams like using teaser rates and zero-down offers to tempt veterans into variable rate mortgages, as well as more creative ploys like disguising marketing materials to make them appear to be communications from the Department of Defense’
One of the largest lenders, how about that?
‘tried-and-true scams like using teaser rates and zero-down offers to tempt veterans into variable rate mortgages, as well as more creative ploys like disguising marketing materials to make them appear to be communications from the Department of Defense’
One would think this would be more in the line of criminal stuff than just the VA not backing loans in a month. Oh well, got to finish that pipeline so as not to slow down the squirrel feeders.
Why is this not illegal PERIOD? Why all the fuss about veterans, but it’s ok for everybody else? It’s time to get real and shut this crap down.
Due to rampant speculation which has now led to two massive real estate bubbles in a little more than 10 years time, I think there needs to be massive tax implications for second homes and “flips.” It’s time to get speculators out of housing. It’s shelter, not some get rich quick scam.
Slap a 90% tax on any profits for any house held less than 5 years, unless it’s a primary residence. 2nd home purchases are subject to a 50% tax on all profits.
‘Why is this not illegal’
Somebody call up Senator Running Deer.
I’ve been checking out open houses in Boise. All of the past four houses I’ve looked at are flips, two of those were from CA “investors” looking to make the quick money.
The “workmanship” (if you can even call it that) on these flipped houses is truly appalling. In one house they sheet-rocked over a street-facing kitchen window! So there is an exterior window that is inaccessible and completely useless - I’ve never seen such a thing. The backslash had some sort of rack attached to it and the grout/adhesive to anchor it was already cracked and separating from the backsplash. Engineered hardwood laid over existing original hardwood - completely covering the floor HVAC registers. Garages partitioned into two spaces and that new space was added to the square footage of the house - a big no no. the house magically went from 900ish to 1200ish sq feet - magic!
I’m also in Boise and the majority of the flips aren’t permitted. You can check online. All you need is the address. I’ve reported a few to code enforcement.
It should be illegal to market to people?
‘more creative ploys like disguising marketing materials to make them appear to be communications from the Department of Defense’
Atten-shun! Alright soldier, stick your head in that noose and jump!
“It should be illegal to market to people?”
No, FRAUD is generally illegal, which is why I was asking why it’s not illegal.
It’s not fraud, it just appears go be fraud because who should be able to understand what they read cannot.
How about a moratorium on foreign buyers? I don’t understand why American workers should be forced to compete for housing with fly-by-night foreign flippers. Let the foreign money launderers park their slush funds in Bitcoin, and leave American housing out of their reach.
Cannot say they were buying real estate but just flew from Las Vegas to Baltimore and 80 per cent of the passengers were Chinese. Heard more mandarin than English. The southwest magazine had ads for property in Williams Arizona and Cheyenne Wyoming.
If you want to find a real sucker who doesn’t understand price or a fair deal, sell to the Chinese. Nobody on this globe is making worse purchase decisions, be it real estate, Sh!tcoin or otherwise…
It’s shameful how federal housing subsidies are focused on luring veterans and low income buyers into assuming debt burdens which will put them into an underwater financial position from which they will never recover.
The bigger shame is why government is meddling in the housing market at all. If they have any role to play, it should be to crack down hard on fraud and to prevent systemic threats to the financial system. Oh, and to not create asset bubbles through ultra-easy credit and “stimulus.” That would ultimately make housing more affordable and prevent the distortions and imbalances we’ve seen in the marketplace.
The Affordable Housing lies out of DC seem alive and well in the Trump era.
You’re preaching to the choir, but I appreciate the clarity of your statement.
Pukes who are offered stupid loans with devastating loan terms should rightfully laugh in the lenders face and walk out the door but instead they rush to reach for the pen so as to sign the dotted line.
Candy from a baby.
Bahahahahahahahahahahahahahahahahahahahahahahaha.
Ha.
Most junior enlisted military members are notoriously bad with credit, and are easy marks for unscrupulous lenders.
I was working for an afternoon on a marine base - me and a bunch of engineers, waiting for the marines to get done with firearms practice so as to free up an area for us to set up some equipment. When they got done, these teen/20 somethings all got in their very expensive but no doubt quite used sports cars (beemer, lexus plus some american muscle) and suvs (same + range rover) and drove back to their barracks or where ever. None of us engineers - all mid career or more - drove anything close to what these kids did. Maybe they lived it up not knowing if they’d be alive in a years time, I dont know.
The women they get hitched to are often pure trash - maybe with a quarter vampire. Some of these poor guys take so much punishment, physically and mentally.
The women they get hitched to are often pure trash
LOLZ
Those young women usually press hard with the sales job to marry and those young guys are thinking with their upper head that much. Sign on the dotted line and they get the insurance benefits, the housing allowance, etc, access to his paycheck and when he’s deployed half of them are out and on the prowl within a week.
It’s very commonly known among the dads my age with teenage sons - if their sons do go into the service, they will try and drill into their heads not to get married, and especially the dangers of an ‘ooops’.
“WestPac Widows”
“Boomer Widows”
But…but…they have “Freedom” in their name. Doesn’t that make them the good guys?
Freedom is just another word for nuthin’ left to lose.
😁
‘That lack of inventory created a feeding frenzy earlier in the year, but the dynamics are changing slightly, with cases of buyers’ remorse impacting the market’
Where’s that whiny taxpayer dude?
‘Bill Facendini, president and broker of Terra Firma Global Partners in Santa Rosa, said in the past three months a significant number of sellers have reduced prices of properties after failing to initially land buyers. Sellers typically try to keep raising prices above what their neighbors obtained in recent sales, he said. But buyers these days seem less inclined to pay the higher amounts. ‘They don’t feel that need right now’
‘Sellers typically try to keep raising prices above what their neighbors obtained in recent sales’
Greedy bashtards, check.
‘in the past three months a significant number of sellers have reduced prices of properties after failing to initially land buyers’
Oh dear, check…
Everybody wants to live in the fire hazard zone!
But buyers these days seem less inclined to pay the higher amounts. ‘They don’t feel that need right now’
If the Greater Fool pipeline just dried up, look out below.
Buyers remorse is happening here in South Orange County. More and more under contract houses are coming back on market.
‘Sometimes buyers have successfully bid for a home, then realize the home really isn’t for them or they paid to much’
Who needs appraisers? It seems the lenders might be out to lunch. Oh wait…
May 25, 2018
“In his corner of American finance, where hard selling meets hard luck, Angelo Christian is a star. Each time Christian sells a home loan, the company he works for, American Financial Network Inc., takes as much as 5 percent. Many of Christian’s customers have no savings, poor credit, or low income—sometimes all three. Some are like Joseph Taylor, a corrections officer who saw Christian’s roadside billboard touting zero-down mortgages. Taylor had recently filed for bankruptcy because of his $25,000 in credit card debt. But he just bought his first home for $120,000 with a zero-down loan from Christian’s company. Monthly debt payments now eat up half his take-home pay. ‘If he can help me, he can help anyone,’ Taylor says. ‘My credit history was just horrible.’”
“Christian can do this kind of deal because he is, in effect, making the loan on behalf of the federal government through its most important affordable housing program. It’s a sweet deal: He gets his nearly risk-free commission. Taylor puts no money down. If things go south, the government ultimately bears the risk. Many borrowers ‘are living paycheck to paycheck and, if they lose their jobs, they go into default immediately,’ says John Burns, a housing consultant.”
“One reason more borrowers may be stretching: Real estate prices are soaring again.”
http://thehousingbubbleblog.com/?p=10443
‘roadside billboard touting zero-down mortgages’
I saw these 4 years ago in Texas. All over the place north of Dallas for new shacks, some up to $900k.
‘If you can’t use cash, you have to be creative when you write up and offer,’ Beyer said. ‘You have to word things and have the correct verbiage. Some people are foregoing appraisals. … Even some, and I don’t recommend this but some are doing no inspections. People will accept the house as is.’
Who needs appraisers? Gotta get in this Michigan market before you’re priced out forever!
But you know, if you don’t have cash (and how many really do) doesn’t the lender require the appraisal and inspection?
‘You have to word things and have the correct verbiage’
This is why you UHS make the big bucks Briana.
No, lenders do not require inspections. Appraisals, sure. Inspections, those are for the buyer, not the lender.
One would think an appraisal would involve some sort of inspection. Oh, right they are outsourcing those to India now.
January 22, 2018
“The Wall Street Journal reports that banks are getting tired of performing actual appraisals for high-volume home loans—the kind that get packaged into mortgage-based securities—and are turning instead to less rigorous broker price opinions: ‘Now these perfunctory valuations abound, underpinning tens of billions of dollars of home deals. Sometimes the process is outsourced to India, where companies charge real-estate agents a few dollars to come up with U.S. home values by consulting Google Earth and real-estate websites. BPOs have been used to value collateral in the more than $20 billion of bonds sold by institutional landlords, such as Blackstone’s Invitation Homes Inc., and in the fast-growing business of lending to individual house flippers.’”
“‘Their popularity,’ says the Journal, ’shows how Wall Street is finding ways to adapt to government efforts to crack down on some of the excesses that contributed to the housing crisis.’”
http://thehousingbubbleblog.com/?p=10321
“Some people are foregoing appraisals”
As my good friend Jingle Biscuits always said, “Every appraisal is apocryphal”.
He’s right.
“If things go south, the government ultimately bears the risk.”
Can anyone recall when or how the American taxpayer agreed to be the bagholder of last resort on dodgy loans? It’s almost like too-big-to-fail never ended.
If things go south, the government ultimately bears the risk.
Wrong. The taxpayer bears the risk, involuntarily. I hate that Uncle Sam is enabling financial irresponsibility by people who’ve already demonstrated that they aren’t credit-worthy.
Are you ready for the punchbowl to be taken away?
Analysis The QE retreat
Halcyon days recede as ECB and Fed step back
Investors revamp portfolios after central banks embark on quantitative tightening
…
The jig is up, and the central bankers know it. Their goose is cooked. Draghi should be swinging from the gallows.
Remember when posters here would say, “the Fed will never stop QE and never raise rates”? Now they are doing both at the same time.
And at what point do you think the fed will start to reverse course? My guess is once the bubble starts to pop.
It’ll be too late by then, as Ben Bernanke learned the last time.
10 year is hovering around 3%. Wake me up when it crosses 5%. Then I will believe the fed is serious. And they may do it just in time for 2020. Deep state gotta deep.
What makes you think it will get to 5% any time soon?
They want to stop Trump’s reelection.
I’ll offer to eat crow if the 10-year Treasury yield surpasses 5% by the 2020 election, given the Powell Fed’s demonstrated commitment to remove the punchbowl.
I also don’t take the impression that Powell, a Trump appointee, is anti-Trump. Do you?
The 10-year isn’t even keeping up with real inflation, which is running much higher than the fake CPI stats. These piddly little .25 hikes are a long-overdue step in the right direction, but are way too little, way too late.
I still don’t understand why they feel the need to end QE, but it’s awesome that they are.
Because there aren’t enough diapers to fill every time they look at the Fed balance sheet. They’re scared of what they’ve created.
Playing the devil’s advocate, what is the problem with leaving $4 trillion on the balance sheet indefinitely, or even doubling it from here to $8 trillion, in order to create further wealth effects that make all asset HODLers fabulously richer? Who is harmed by the quiet, incessant humming of the electronic printing press?
Mass rioting, mayhem and murdering of politicians and bankers?
Between central bank monetary policies intended to transfer the wealth and assets of the middle and working classes to a rapacious oligarchy, and globalist open-border policies that are destroying sovereign countries and distinct European peoples, more and more ordinary people are saying: “Enough!” If there’s one thing that frightens the central bankers and their handlers, its the Spector of rising populism and nationalism, along with the realization they could one day be held accountable for their crimes and swindles against the 99%. Nothing could be more terrifying to a globalist or bankster.
Q posts online (I love this stuff, wherever it’s coming from.)
The populist backlash against the central bankers and their monetary rackets that enrich the few at the expense of the many is well underway in Europe. Drahi is going to have a lot less room to maneuver going forward, which means crunch time is getting closer.
Markets
Dudley Foresees Need for Fed Rate Hikes to Slow the U.S. Economy
By Matthew Boesler
June 15, 2018, 8:03 AM PDT
Outgoing New York Fed chief defends central bank’s rate plan
Blaming emerging-market turmoil on Fed goes too far, he says
…
Money sloshing around a la 2005. The horse left the barn years ago, the door is swinging noisily on one hinge - hurry up, get the bailing wire…
Economy
Economy World Economy US Economy The Fed Central Banks Jobs GDP outlook
A fourth Fed hike this year could trigger economic slowdown, strategist warns
- The Federal Reserve raised interest rates for the second time this year on Wednesday and is looking at two more for 2018 amid a strong outlook for the U.S. economy.
- A fourth rate hike this year could bring about an inverted yield curve and economic slowdown, Principal Global Investors CEO Jim McCaughan believes.
- McCaughan pointed to what he saw as a disparity between reported rate of inflation and the actual rate, which he said was altered by the impact of technology on the U.S. economy.
Natasha Turak | @NatashaTurak
Published 9:21 AM ET Thu, 14 June 2018
…
Economy
A fourth Fed hike this year could trigger economic slowdown, strategist warns
- The Federal Reserve raised interest rates for the second time this year on Wednesday and is looking at two more for 2018 amid a strong outlook for the U.S. economy.
- A fourth rate hike this year could bring about an inverted yield curve and economic slowdown, Principal Global Investors CEO Jim McCaughan believes.
- McCaughan pointed to what he saw as a disparity between reported rate of inflation and the actual rate, which he said was altered by the impact of technology on the U.S. economy.
Natasha Turak | @NatashaTurak
Published 9:21 AM ET Thu, 14 June 2018
…
Given how political central bankers have become in recent years, measures to rein them in seem only fair.
Central banks are too powerful for their own good, says former Bank of England deputy governor
By William Watts
Published: June 16, 2018 3:45 p.m. ET
Backlash could undermine independence, says Paul Tucker
…
Bellevue WA Housing Prices Crater 11% YOY As Seattle Area Floods With Defaulted Housing
https://www.movoto.com/bellevue-wa/market-trends/
Your sensational headlines are almost “National Enquirer” worthy, but more “Weekly World News” right now.
Falling prices are what they are my friend.
‘D-FW is one of the U.S. markets CoreLogic thinks is overvalued for home prices. However, Nothaft doesn’t think there is a nationwide price bubble yet. ‘But if we continue to see relatively rapid growth of home prices over the next few years, then we might be entering a period when home prices can no longer be sustained’
Click!
Bubble denial is the first stage of the housing but bubble stages of grief.
Arcadia, CA Housing Prices Crater 19% YOY Bay Area Tech Wreck Bleeds Into Southern California
https://www.movoto.com/arcadia-ca/market-trends/
Simpson’s Buyer’s Remorse:
https://www.youtube.com/watch?v=AM9uBjsg5Q0
There’s been a definite uptick in the amount of solicitations I receive in the mail for refis, HELOCs, and even personal loans. Yesterday’s pitch was a $50,000 HELOC for $192/month. Only in the fine print does it mention that it’s interest-only. Yikes.
Lenders must be getting desperate if they are carpet bombing American households with junk mail!
Realtors are liars
Q: Why did the Realtor cross the road?
A: To lie to the used house buyer on the other side.
A friend of mine buried a realtor upside down in his back yard and his house sold in less than a week.
Who knew used home sellers could be so useful?
Did your emerging markets investment HODLings submerge?
The Financial Times
Opinion Instant Insight
Trump tariffs threaten China’s status as emerging markets anchor
A rise in protectionism will affect growth and the export market
James Kynge yesterday
Until recently, China’s economy was one thing that an otherwise turbulent world did not have to worry about. A rock solid 6.8 per cent in GDP growth in the first quarter made the world’s second-largest economy a bulwark against emerging market squalls, a slowing eurozone and rising US interest rates.
But China’s role as a mainstay may be about to come under increasing strain. The announcement on Friday of US tariffs on $50bn in Chinese exports — and Beijing’s promise to respond in kind — comes amid clear signs that the Chinese economy has begun a broad-based slowdown.
…
The Fed Dulls Hopes of an Emerging Market Rebound
The dollar’s rally means emerging-market pressures are set to stick around
By Richard Barley
June 15, 2018 7:46 a.m. ET
Emerging markets have swung from investor darling to disappointment this quarter. Any bet on a rebound will require patience.
One big stumbling block is the strengthening dollar. This week’s decisions by the Federal Reserve and the European Central Bank have dented hopes that the greenback might start weakening again. The contrast between the ECB’s caution on rates and the Fed’s confidence is stark.
…
Economics
Massive Argentine Peso Plunge Deepens Emerging-Market Selloff
By Rita Nazareth
June 14, 2018, 12:32 PM PDT Updated on June 14, 2018, 2:03 PM PDT
Peso tumbles amid reports of central bank departures
Brazil’s real extends drop as traders snub record intervention
Argentina Pins Hope on New Central Bank Chief to Stem Peso’s Slide
The brutal tumble of Argentina’s peso added to the list of concerns over the ability of developing economies to defend their currencies as the era of cheap money wanes. Emerging-market assets extended losses a day after the Federal Reserve’s more hawkish signals.
A measure of currencies in developing nations slid to the lowest since December, while the MSCI Emerging Markets Index sank — led by industrial and technology companies. The Argentine peso slumped more than 6 percent on reports of changes at the country’s central bank and after truck drivers began a strike. The Brazilian real dropped a fourth day as the impact of a massive sale of foreign-exchange swaps was short lived.
…
“Peso tumbles amid reports of central bank departures”
I think we’re finally reaching the point where “central banker” is a dirty word. The people have caught on.
The dollar is dead. Long live king dollar.
Emerging Markets Can’t Blame the Fed for Their Problems
Countries that feasted on cheap money for almost a decade ago are now suffering from a withdrawal of global liquidity.
by Komal Sri-Kumar
June 12, 2018, 10:00 AM PDT
Fed Chairman Jerome Powell is poised to keep raising interest rates
Photographer: Bloomberg
Emerging markets have taken a hit from the prospect of even higher U.S. interest rates and a stronger dollar, which increase the cost of servicing external debt. The pressure can be seen in the depreciation of their currencies, with the MSCI Emerging Markets Currency Index dropping 3.54 percent from its high this year in early April.
Countries that feasted on the cheap money that resulted from the quantitative easing and near-zero interest rates initiated by the Federal Reserve almost a decade ago are now suffering from a withdrawal of global liquidity. The correction in emerging-market currencies, debt and equities has further to go with the Fed poised to raise interest rates on Wednesday for the seventh time since December 2015, and as global trade tensions boost investor demand for currencies such as the dollar that are considered havens.
…
Except for Argentina’s government is doing pretty much everything right. Macri inherited a total disaster from the Kirchner government and is doing about as good as can be expected considering the circumstances, though he needs to do more. The central bank will have to allow more weakening of the peso and increase interest rates, otherwise Argenitines will have reminiscences of the frightful corralito.
Highlands Ranch CO Housing Prices Crater 10% YOY As Housing Bust Lambasts Denver Economy
https://www.movoto.com/highlands-ranch-co/market-trends/
For Fathers’ Day, the Huffington Post provides the following narrative:
‘There Are No Stepdads In Our Family — Only A Dad That Has Stepped Up’
“My daughter now wears a necklace engraved with “The Day I Became Your Dad,” and my son can no longer remember a time before my (new) husband was here. When my daughter is sick, he sleeps on the floor next to her bed. When she needs ridiculously expensive gluten-free play dough for school, he is the first to whip out his credit card, despite my protests about the price. In fact, when my son was diagnosed with epilepsy that required tens of thousands of dollars in treatment, he never flinched at the bills coming in; because, as he told me, we take care of our kids. Right now, he’s at karate, cheering on “his son,” because there are no stepdads in this family, there is only a dad that has stepped up.”
https://www.huffingtonpost.com/entry/there-are-no-stepdads-in-our-family-only-a-dad-that-has-stepped-up_us_5b23e90ee4b0d4fc01fdfbe3
Don’t be a BetaBux. Just don’t…
“…he is the first to whip out his credit card, despite my protests about the price. In fact, when my son was diagnosed with epilepsy that required tens of thousands of dollars in treatment, he never flinched at the bills coming in…”
****shivers****
Why do the poor always have so many f*ing problems?
Brad Paisley: He Didn’t Have to Be. Happy Fathers Day to all dads and stepdads, especially the ones trying to do it right.
https://www.youtube.com/watch?v=BjO1F6oCab8
Grandma strangles rabid bobcat with her bare hands
NY Post
June 16, 2018
““They go for your jugular . . . when they can get the vein you’re dead in a couple of minutes,” she said, noting she was careful not to yell until the cat was subdued, because she didn’t want her 5-year-old granddaughter to come outside.
Phillips refused to release the beast until her son showed up and stabbed the animal “four or five times.”
“It never budged, so I knew it was completely dead,” she said.”
https://nypost.com/2018/06/16/grandma-strangles-rabid-bobcat-with-her-bare-hands/
I also noted from this article that she didn’t want any shots fired into the bobcat. She knew enough about firearms to be wary of bullets & their fragments going where you don’t want them to go.
Yeah, you kind of figure anybody who takes on a wildcat with their bare hands probably has a little firearms experience too.
Generation Delusional? Millennials expect to retire at age 56, study says
By Michelle Robertson, SFGATE
Updated 7:19 am, Wednesday, June 13, 2018
The evidence seems to suggest that. Omaha-based brokerage firm T.D. Ameritrade asked 1,500 Millennials — those aged 21 to 37 — when they expect to retire. Respondents, on average, expected to retire at age 56.
That is wishful thinking for multiple reasons. Currently, the average age of retirement is 63 in the U.S., according to census figures. But that number has been rising since a low in the 1980s. According to MarketWatch, the retirement age has increased to levels not seen since the 1960s — and it’s only expected to get higher.
https://www.sfgate.com/lifestyle/article/millennials-retirement-age-savings-generation-12988552.php
The good news is that U.S. life expectancy is steadily dropping, so they won’t need to pay as many years of living expenses post-retirement as do today’s retirees.
US Life Expectancy Likely to Drop for Third Straight Year
By Daniel Starkey
05.28.2018
Study says: Ditch the opioids for over-the-counter medicines (via stevepb/Pixabay)
The US is in a bad way. And I’m not just talking the political climate…or actual climate. Life expectancy in the US has been on the decline for the previous two years, and it appears that we’re on track for a hat-trick. Preliminary CDC data suggests that suicide and drug overdose are on the rise and are the big contributors to the decline. What’s concerning, though, is if these trends do ultimately hold, this will be the first time since the Spanish Flu Pandemic of the late 1910s that the country has faced three years of decline in a row. And that outbreak claimed the lives of more than 100 million worldwide.
The mortality data was released Wednesday, and analysis shows that the death rate rose slightly from 2016 to 2017. It currently sits at 734 deaths for every 100,000 people once “natural” factors like age are taken into account. But, due to the fact that cause of death can take time to investigate — both with law enforcement and with medical examiners — while we can be sure that there have been more deaths, it’ll be a little bit longer until we can be sure that these are, in fact, premature deaths.
In slightly better news, cancer and heart disease claimed fewer lives last year than in years prior, but diabetes, Alzheimer’s and pneumonia all rose.
The trend directly implicates opioid overdoses and similar causes of death, though. As they tend to have an outsized effect on these trends. Older deaths, like say someone dying at 76 is going to knock that average down a lot less than an overdose at 25. Similarly, the Spanish Flu claimed many younger folks, dramatically affecting the life expectancy at birth figures of the time. In 2016, a newborn in the US could expect to live 78.6 years. While it’s not known what that figure will look like for 2017, Anna Case, a researcher at Princeton told the Associated Press, “Looking at these numbers, it seems likely [that will drop].”
It’s a morbid reality, and points to the incredible impact of the overprescription of opioids in the US and just how little has been done to help stave it off. But, the good news is, for most who aren’t at risk, these figures don’t mean that you can expect your life to be cut short. Just that we, as a society, have allowed pharmaceutical companies to commit a great tragedy on our youth, and we are ignoring many who desperately need help.
…
Maybe Social Security really is going away?
New warnings about cuts to Social Security and Medicare are a reason to worry
By Paul Brandus
Published: June 16, 2018 10:13 a.m. ET
Social Security and Medicare are still looking wobbly
Getty Images
You’ve spent a lifetime paying into Social Security, but there’s no guarantee that you’ll get out of it what you’ve put in.
In fact, the way things are looking today, the odds aren’t looking too good.
…
SSDI… the retirement plan for the obese and drug-addled young.
Millennials have been inculcated since kindergarten in the ideology that big gubmint is the solution to all problems, and they are entitled to have someone else take care of them.
She is good, I hope her father along with all you HBB fathers have a
Happy Father’s Day.
School receptionist celebrates summer break with amazing intercom serenade
Jun 15, 2018
Regina Ballard, receptionist at North Lincoln High School in Lincolnton, NC celebrates the start of summer break by serenading the rest of the school over the intercom singing “At Last” by Etta James.
By Regina Ballard
https://www.youtube.com/embed/W-0EKlijXZs
North Palm Beach FL Housing Prices Crater 8% YOY As Crushing Housing Losses Mount
https://www.movoto.com/north-palm-beach-fl/market-trends/
With the immigration crackdown underway and record low birth rate, coupled with Baby Boomer retirement and die-off, it’s hard to imagine how the incipient housing supply glut will be absorbed without massive price reductions. Given the other factor of punchbowl removal operations and attendant interest rate normalization, it seems like the housing market faces tornadic headwinds ahead. This should be useful for relegating the Housing Bubble to the annals of financial manias.
Happy Father’s Day to those of you who were willing to pay the price of the pleasure of fatherhood.
Posted May 21
Our View: U.S. birth rate plummets as cost of children soars
Given the lack of support for families, it’s hard to blame millennials for forgoing having kids.
By The Editorial Board
Day care takes up nearly 11 percent of the median income of a married Maine couple; a single parent pays over 30 percent of median income. Staff file photo by Shawn Patrick Ouellette
The United States last year posted its lowest fertility rate on record and the fewest number of births in 20 years. Whether that is no more than a statistical blip depends, like so much else, on the actions of the millennial generation – and given how we treat early childhood in this country, who can blame Americans in their 20s to mid-30s if they hold off on becoming parents?
There were 3.85 million births in 2017, 2 percent fewer than 2016. That’s nearly 500,000 fewer newborns than 2007, even though there were 7 percent more women in the prime childbearing years of ages 20 to 39. That puts the fertility rate at a record low 60.2 births per 1,000 women, taking the U.S. further away from the level necessary to replace one generation with the next.
It may be that the members of this generation are putting off marriage, so kids will come later. Perhaps they are waiting until they are on firmer financial footing, or until they are finished education or have established their careers. Perhaps it is all just a delay that over time will work itself out.
Or maybe millennials, already saddled with student loan debt and unaffordable housing, look at the high cost of child care and the burden placed on parents of newborns, and figure they just can’t pull if off.
The U.S. is the only developed country where there is no statutory right to paid maternity leave. Instead, federal law guarantees only 12 weeks of unpaid leave for employees of companies with more than 50 employees. (Maine law lowers the threshold to 15 employees.)
…
Like I said, the bankruptcy of Toys R Us was just the canary in the coal mine. The US demographic shift is underway and it will ripple out and affect a myriad of businesses in ways both anticipated and unanticipated.
It’s too late now to dump your cryptofund.
The Financial Times
Cryptocurrencies
Cryptocurrency hedge funds’ returns plunge
Specialist funds target digital coin despite mixed messages from regulators
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A friend of mine is a Bitcoin true believer, who amassed a lot of this scam currency when it was around $3500 a coin (or whatever the unit is), and has since watched it roundtrip up to almost $20K, then back to $6500 or whatever it is now. He’s a good dude, but he’s going to have to learn the hard way that he was a classic fool.
He’s going to have to learn the hard way that he was a classic fool.
I don’t know..sounds like he’s still up 85% or so!
‘Agents must counsel buyers and sellers about the way the housing market works,’ he said.”
Oh, right. Suzanne is going to tell her clients that her research indicates housing is a massive bubble, thanks to ultra-easy credit, and she’s got a fiduciary and ethical duty to inform them that buying a house right now, at the peak of the market, would be their financial Waterloo.
Yeah, that might happen.