Bits Bucket For August 5, 2008
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
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Thoughts on the impact of the FOMC on today’s market?
With the right language accompanying unchanged rates (eg, “We expect the threat to economic growth to exceed the risk of inflation for the forseeable future”), this market could skyrocket.
Of course low rates are detrimental to the long-term health of the economy and strength of the USD, but that’s won’t stop them.
The commodities have been whacked good to lay the groundwork for the “inflation is not a problem” approach. Who knows, they may even come out with the old “deflation is our biggest fear” line.
The bottom line is that the only way for the American economy to function is for Americans to be given “free” money. I expect voters to demand this and I expect politicians to give it.
what i am wondering is if the FED asked the hedge funds to let the oil and commodity makets tank a little so they can get away with not raising the interest rate, then run the prices back up afterwards.
You are basically correct; the argument now goes ‘look, oil is down, so you can cut rates again’. They want more cuts.
I expect voters to demand this and I expect politicians to give it.
It’s no stretch to say that politicians are now resorting to buying votes (with MY money!). BHO wants another “stimulus”, handing out $1000 checks to people, with the top few percentiles of taxpayers footing the bill (and not eligible for the stimulus, of course).
Our Democracy is essentially over. The masses, who apparently don’t want to work, create, or be productive, simply want to squeeze every last dollar out of the tiny minority of Americans who actually do something more productive than selling condos to each other. As long as it’s possible to tax people differently depending on their level of income–as opposed to a flat percentage for everyone–we don’t have a democracy.
Cry me a river, Reuven. I drive a bus for a living and I probably pay a higher percentage of my “earnings” in taxes than you do.
It was quite an eye-opener last year to see how little tax I paid on investment earnings, which I hardly worked for at all, just a little reading and the effort to get off my behind and open an account, versus what I was taxed on the money I sweated and struggled and endured all kinds of imprecations for. (Customers don’t always treat us right, you know.)
Plus I hand over quite a bit of money every year to insure myself against short-term disability, because if I hurt myself outside of work and therefore am unable to work, I don’t get paid.
And before you call me an a-hole for choosing to drive a bus (after all, I am qualified to do other kinds of work), let me just tell you that somebody has to do it. As long as we aren’t using fixed guideway systems, somebody has to do my job. Am I a total a-hole because I willingly took a job (because I love transit and I wanted to learn the ropes from the bottom up) rather than “creating jobs for others”, and I thus deserve to be treated more harshly by the tax system? Come on, now.
Our Democracy is essentially over.
A little melodramatic don’t you think? It’s all about what our society values, capital or labor. The system has titled too far to the capital side and must now come back in order to restore some balance.
I am not consumed by petty jealousy because there are people who make more money than I do. Good for them, I say.
And I never suggested there’s anything wrong with driving a bus, or any job for that matter.
What I do feel is wrong is a politician trying to appeal to the masses by promising to confiscate money from a minority to hand to the majority!
I’m not even against higher taxes, if that’s what we need to pay for the money spent/misspent on the Iraq war. In fact, I’ve advocated here for YEARS raising taxes.
For example:
- I’ve always been opposed to the mortgage interest deduction EVEN THOUGH I HAVE PERSONALLY BENEFITED FROM IT.
- I’m opposed to George W. Bush’s signing into law a bill that exempts forgiven mortgage debt from income tax.
My ideal tax code would be for EVERYONE to pay the same percentage with no deductions for anything.
If we’re going to have to raise taxes under the existing bracketed system, then EVERY bracket should rise. Instead of 10%, 15%, 25%, 28%, 33% and 35%, make it 11%, 16%, 26%, 39%, 34%, and 35%.
That’s FAIR. And I would support a candidate who proposes that. Proposals by both candidates, admittedly, are less than ideal. But trying to buy votes and start a class war is especially contemptable.
Some other points:
I was amazed that there are people here who think that it’s unlikely that anyone works 70 hours/week. I have news for you: nearly every self-employed successful businessman does.
The other attitude I see in this forum is that the only way to be financially successful in the United States is to cheat. I just don’t think that’s true. Sure a lot of people are less than honest, but in my experience dishonesty cuts across all income levels. You know how many times I’ve walked into a mom and pop store and seen the proprietor not ring up a cash sale? Or have a plumber come over and offer me a “cash discount?” And of course, our reason for all of us being in THIS forum: Millions of low-class get-rich-quickers lying and cheating, in cahoots with the R-E industry, to buy houses they couldn’t afford in the hopes of making an easy buck. (And trying to get the government to confiscate MY money when things go wrong.)
And of course, our reason for all of us being in THIS forum: Millions of low-class get-rich-quickers lying and cheating, in cahoots with the R-E industry, to buy houses they couldn’t afford in the hopes of making an easy buck. (And trying to get the government to confiscate MY money when things go wrong.)
———————
If you’re referring to Wall Street types and over-paid executives and “fund” managers, then I agree with you.
If you’re referring to the Schmoes who got too deep in debt, we disagree. They are fools and jackasses, but most of them were convinced **by people who knew better** that they could afford their new loans. Though they are NOT innocent, they are not the cause of the problems. IMO, Greenspan and all the “capitalists” caused the problems when they took rates so low and forced everyone to take risks they wouldn’t normally take.
I have seen this arrogance here before.
No group has the “I am entitled to more” attitude than some of the very wealthy in this country. And, no, those that I refer to produce nothing and in fact leach from society more than those you deride.
leech
If anything kills our democracy it’s the elite and the concentration of wealth.
This entire collapse can be laid at the hands of these wall street pigs. The whole system is designed to strip wealth from those who work and save and invest conservatively. How do you get Pensions, and 401k’s, and endowments, and conservative investors to part with their money.
Step 1. Make crap look like gold - Rating agencies are bought off, crap is insured with credit default swaps that look good but may be worthless.
Step 2. Banks and Wall Street off load crap on FED, the rest of those that purchased it are stuck
Step 3 inflation - Now inflation kicks in due to debt. No place to hide in most 401k’s, and conservative investors see bonds collapse.
CEO’s made boat loads on the way up, now they are getting out of the boat while the FED keeps the boat from sinking.
Here’s a little “tin foil” on the bond market and a purported monetization back in the late 90’s, for those interested in such “stuff”.
http://news.goldseek.com/GoldSeek/1217946600.php
“Our Democracy is essentially over.”
We never had a Democracy, we had a Republic. Now we are seeing what a Democracy is all about, the majority get what they want,and what they want is money and benefits with little or no work. It started with flushing the “R” word (responsibility) down the toilet and then granting any and all minority causes whatever they wanted at the expense of the responsible working majority.
If you want “democracy”, go to Greece. Otherwise, pucker up!
Also, this is an election year, so gas will go down until the election so that the sheeple vote for the status quo (since “everything is contained”); then, gas prices will start to climb right after the election. This happened in 2006 - I paid attention that time - and probably in earlier years as well.
The IMF also made their contribution today by predicting that Eurozone inflation (currently at 4.1%) will fall below 2% in 2009. This backs the ECB for doing nothing tomorrow, instead of cranking up interest rates like they should. I’m sure the IMF ‘economists’ got some phonecalls to ask for their help in solving some little problems with the market.
ZERO effect.
The safest bet in the country is the Federal Reserve will do nothing.
FOMC statement: Blah, blah, blah growth will remain weak blah blah blah inflation is coming down blah blah blah
Loans for everyone,
No down no closing costs and you don’t need good credit.haven’t we been here before?
https://www.naca.com/about_naca/purchaseOverview.jsp
anyway, credit is still on the loose in most of the world.
10x income, I/O, 100% loans? no problem in Netherlands.
this epic worldwide credit/housing bubble will need many years (possibly a generation) to deflate.
You can go through the approval process with NACA and get qualified but try actually purchasing with them - it’s a screaming nightmare. I thought they sounded great but in fact they about as efficient as the DMV and any state college admissions office.
I have a damn near perfect fico, very strong employment record, cash reserves, liquid money for a 20% dp and zero debt. In other words, I was a perfect loan candidate and no matter who I called, they couldn’t be bothered with the most simple issues. I’m convinced they help very few people.
“ZERO effect.”
It amazes me how much media hoopla can be generated by a policy decision which is a foregone conclusion.
Legislation to help California “foreclosure” pets:
http://tinyurl.com/56bubr
“Monday, Gov. Arnold Schwarzenegger signed legislation that could help some of the innocent victims.”
“Carried by Assemblyman Mark DeSaulnier, D-Concord, AB 2949 outlines the responsibility and liability of lenders regarding abandoned animals. Pet advocates claim at times banks have prohibited employees from feeding or caring for the pets left behind. The measure provides bank employees with the ability to take responsibility for the pets and turn them over to shelters, potentially saving their lives.”
“Many homeowners are too stressed or overwhelmed to seek better alternatives for their pets, even though alternatives to abandonment exist,” said Nicole Forsyth of the California Animal Association, a coalition of 13 state and national animal protection groups that work together to advocate statewide policies to improve the lives of animals. “AB 2949 makes it clear that people who find abandoned pets on foreclosed property can immediately intervene to help prevent the animals from suffering all alone.”
Finally some legislation to help some truly innocent victims.
“Many homeowners are too stressed or overwhelmed…”
Yes, but with langauge like this, it’s tough to tell who exactly CA thinks the real victims are. Besides, pets can’t vote, but pols know lotsa voters care about animals.
They need to go after these jackasses and fine them up the wazoo. It shouldn’t be that difficult to track them down, unless they were illegals.
Seize their car, garnish their wages, whatever. But legislation needs to be passed to enable humane societies to recoup their expenses (and then some) by holding these idiots responsible.
Leaving a pet alone in a locked house (or setting it loose in the “wild” to fend for itself) is beyond cruel. One of our cats was abandoned in an large empty field behind my old office. He was five weeks old and sopping wet, probably wouldn’t have lasted the night. So we took him in, even though we already had 3 cats. I still hope the person who abandoned him burns in hell.
Why not just take them to the shelter?
Well, They couldn’t be bothered with saving a 20 %down payment. They couldn’t be bothered with reading their loan docs. They couldn’t be bothered with picking up a calculator to figure out future affordability. They couldn’t be bothered with researching the “why’s and how’s” of housing prices inflating at double digits each year. And now they can’t be bothered with the simple act of providing shelter for the very animals they purported to care about by buying them in the first place. This whole country is populated with retarded, selfish bastards. Is there something in the water or what?
Bingo. I wrote this long rant that grew so dark I couldn’t post it. (Mentioned a past French heat wave and all the never claimed elderly bodies.) So I wrote the positive one.
Then I read your post and felt compelled to support it. So many people are about protecting their “buzz”, its become totally acceptable in many circles to walk away from those that can’t take care of themselves. Even the local church ladies only want to cater to the serene dying abandoning those that prove a little less happy about things as unworthy.
I sure hope the concept of responsibilty being non-negotiable makes a come-back.
CarrieAnn, this aversion to negativity is one of the major reasons for the problems of Western society. Life is a lot more negative than positive and it is unadaptive to avoid this reality.
auger-inn,
While I agree for a certain percentage of the population, you are correct. I have no way of knowing the percentage who fit your profile, however you have to give some credit to people’s educational background. Most individuals do not know how to due math beyond add, subtract, multiply and divide. Heck, the advantage of a cc is that you do not fill out a checkbook balance. I have 2 brothers in construction like this. Their finances were not straightened out until they married and their wives did it.
I have a very low opinion of the education system (K-12) that kids pass thru for a diploma. However, have you heard about all the kids that do not graduate. I think I heard that around 50% of the kids in the LA school system drop out some where between the 9th and 12 grade.
So i guess this is the people pool that we are dealing with. I am surprised that alot of people can find their way home at night if they can not accurately count change, read a map or simply read street signs-and these are individuals born here.
lol
PS: Whats that old Air Force joke: Planes are designed by PhDs, Flown by BSs, and maintained by high school graduates. Good luck on your next flight.
auger-inn,
I totally agree that its inhuman to abandon a pet dog, however I must say that I have no concern for cats. In my experience, cats are so independent that they feed at more than one home. They are not restricted by a fence, unless its an indoor cat. Personally, I suspect cats are less domesticated than people think.
just one person’s opinion.
I have a story for you, lost.
An indoor cat, mine pushed out a screen one day unbeknownst to us, and spent the night outside.
When I went looking for her the next morning, she did not come to me but instead meowed from under a row boat in the back yard. When I peeked under the rowboat there was a frozen in fear, trembling cat at the opposite end of the boat. She never did come to me. I had to lift the heavy boat w/one hand and scoop her up w/the other and bring her inside to “safety”.
I think if she had to fend for herself, she’s be a goner.
A 5 week old kitten can’t take care of itself any more than a 2 year old human could.
I respectfully disagree. Abandoning pets is just wrong, cat or dog.
My brother lives just outside of town in a semi-rural area. In the past few months, he has had 6+ dumped cats show up at his house after years of never seeing more than maybe one. The cats don’t know what to do and often are hit by passing cars. He can’t possibly take care of them all, and he’s not about to let the coyotes take care of them.
The FBs responsible for this are just forcing him and the neighbors to take the cats to the animal shelter instead. An abandoned cat is completely at the mercy of the neighbors generosity. A dumped cat doesn’t have much of a chance at all.
I can’t stand the people who let their cats out to roam at night. They should at least feed them prior. After they get done shredding all of the trash bags in my neighborhood it looks like a trash truck over turned.
Skip
I think cats should be strictly indoor animals for a variety of reasons but there are many animals in the city that dig in trash like racoons and possums.
While i have nothing against people having animals, please for God’s sake, clean up after them. In NYC it is such a huge problem, dog poop is everywhere. Additionally do not feed homeless cats near apartment buildings (some people bring out food, etc overnight - this attracts flies, causes bad smell, etc). If you want to take care of them, take them to the shelter or YOUR apartment/house.
Finally, please try to control your dog when it suddenly starts going crazy barking. A lot of people in NYC just smile when their dog goes crazy on bystanders. Understand that some people do not enjoy being barked on, randomly on the street (Funny how it is always tiny “mouse dogs” that bark the loudest and most annoying.
Sorry for the rant.
They are cats, they don’t even run when you approach them. I use a water pistol with 50/50 bleach/water mixture my mailman friend recommended. That seems to get rid of them for a while.
Skip,
Apparently you think it’s funny to abuse animals. Maybe you are aware that every state now has an animal anti-cruelty law? You might be interested in the following (particularly the part where it refers to the impetus to weed out future sociopaths):
“Today, every state has an animal anti-cruelty statute. These laws do not afford animals legal rights, but rather serve as the primary legal protection for animals in our legal system.
..state laws penalize two types of actions under their anti-cruelty provisions: (1) intentional acts and (2) the failure to act. Intentional acts are those acts of cruelty where the actor knowingly tries to hurt an animal by repeatedly striking an animal, burning an animal, or committing some other heinous act. These acts will often be classified the most severely under the applicable criminal law (serious or repeat offenses may even constitute felonies under the specific state law).
…
Whether the impetus behind the adoption of such laws is to weed out potential future sociopaths or the actual concern for all living creatures, these laws provide the first, and sometimes only defense for many animals.”
http://www.animallaw.info/articles/ovusstatecrueltylaws.htm
It’s anecdotal of course but about a year and a half ago I noticed a real uptic in obviously abandoned ‘stray’ cats in my Baltimore city neighborhood. All of these cats had clearly been around people at some point, presumably as someone’s pet but somehow the all managed to find their way under my front porch or around my back door. Fortunately for them I love cats and was willing to give them the care they deserved but it just kills me that people would willfully abandon these poor creatures to a cruel death. Seriously, anyone who would do that should be stripped naked and dropped from a helicopter about 150 miles from the nearest town. Via con Dios MotherFu-er, Lets see if nature treats you any better than you treated your ‘pets’
We have a country full of people following a cult of selfishness masked by their particular fuzzy “religion.” Some of the people I interact with on a regular basis have frightening (at least to me) views of how the most important things in life are to honor one’s impulses, follow one’s dreams, and simultaneously rationalize any pain and suffering in the world (including that which you imposed) as part of “the plan.” No notion of giving back to the community. Only sappy sentiment while sipping a latte (”I think I’d like to open a center in Costa Rica to promote healthy, green living and to save Tibet … bla bla bla”). These people have no clue that their pretty little world rests on the backs of other people. Much as I try to “zen out” the psychobabble, I end of seething at the self-centerdness of it.
wow, sounds like conservative christians
I guess everybody has to tune out the suffering of others at one point or another. It’s the self-righteous attitude that gets me. And the people you are talking about (mostly new age/new thought in orientation) can be some of the worst!
Oooo, look at me, I’m eating organic local soy tempeh bars, they’re yummy (not) and a wrinkly t-shirt to show how much I care. I think I’ll go to a counter protest and scream at some old ladies like a spoiled child.
vs
God has blessed us because we’re saved. It’s too bad about the suffering in the world, but it all starts because people reject God. If only they would listen to Jesus, they wouldn’t be abused/hungry/homeless…
Wow…sounds like the enviro-nuts.
Fantastic post, CasaTostada. So much said in so little space. I hope you post often in the future.
I so agree with you. How hard is it to drop an animal off at the pound?
Our local shelter charges around $50 per animal brought in. Not many people are going to pay that.
What would the shelter do if someone dropped off an animal and said they couldn’t afford the fee?
About 2 years ago someone dumped a pitbull puppy at the SDG&E substation by my house. My neighbor found the puppy and brought it to me. It had diarrea and looked bad. I call animal control, then decided I couldn’t wait and took the poor baby to the shelter.
At the shelter in San Diego they have cages with 2 doors. You can put in your unwanted animal in one side and they remove it from the other then you can slink off into the night. You don’t even have to speak to anyone. I felt horrible. I was bawling and bawling and didn’t want to just leave. Someone saw me and directed me to an office. They had to put the puppy down, it had Parvo.
I’m dealing with wealthy neighbors now who moved out of their house so it could be remodeled more than a year ago, and left one of their cats behind. I’m feeding the poor thing, but it needs to see a doctor (she’s digging at her ear and crying), and the owners refuse to come and put her in a carrier so I can take her (they would never take her). The cat will not let me touch her, and she’s too smart for me to trick into a trap. Hillsborough Animal Services (translation death camp specialists) will not help, and none of the local alleged animal rescue groups will either.
I think people who neglect, harm, or abandon animals should be quietly gassed. And no, cats cannot fend for themselves.
I feed all the stray and semistray cats that come around. One belongs to a neighbor who is more of a dog person but had the cat dumped on him. He feeds her, so she’s looking for affection more than food. The other comes around sometimes, very scared but willing to eat the food I put out. He doesn’t seem to belong to anyone now since he was starving when he started hanging around. Sometimes we see him, other days we don’t. I still put food out.
And no, cats cannot fend for themselves.
Feral cats can. There are nearly 20 that have chosen to live at the townhouse complex I rent in because the idiot tenants leave cat food out for them when that is specifically against township ordinance (which also brings other wildlife by for snacking - such as raccoons, hedgehogs, etc.). These cats would be just fine (in fact, probably better off) if they were left alone to fend for themselves. I know they can catch rodents, birds, etc. to eat because I’ve witnessed it. But now that the bleeding heart cat lovers have decided to be wannabe heroes, I have to deal with cat crap, urine, throw up, cat fighting, and more in my tiny suburban complex.
A domesticated cat is a completely different issue.
P.S. I do not hate cats. But I do think ferals should be left alone.
Feral cats live on average 2 years. They can find food, but they will either be killed my another animal or get some kind of infection that may be easily treated and end up dying from it. The best thing for the would be to be trapped and spayed or neutered then released again. If it were so easy for them to survive then there would be several times more feral cats.
“The best thing for the would be to be trapped and spayed or neutered then released again”
Exactly! Baltimore city has a program that will do that for free and I’ve become quite adept at trapping the local felines and turning them from a ‘he or she’ to an ‘it’. They are no worse for the wear and I let them live out their lives as best they can. I have had some ‘feral’ cats totally surprise me though and turn into really affectionate and playfull house cats. It just depends on the cat I guess but the smart ones know a good thing when they see it.
Send the idiot neighbor a bill for food at 100xcost then file a lien on the property.
According to Hillsborough Animal Services, the neighbors have never had most of their cats–including the one in question–licensed, so there is no way to prove they are the owners. If I could find out who their veterinarian is, I might be able to, since she has been spayed.
Karma has its own equivalent of “burning in hell” in a fiery torment.
Hmmm… can’t we just give the pets teaser loans and let them buy their own houses? Think how that would help prop up the Bubble - if pets could buy houses!
CarrieAnn,
I agree, that whether cats or dogs, the young always pay the price, because they are helpless.
My only question is why are we more concerned of the young of dogs and cats as opposed to human children. Are human children better capable of surviving than the young of cats and dogs.
Not making an ethical determination here, I would think that we would want to save them all…
My only question is, given a shortage of time, who get first place in line..Human children’s survival or pet’s survival?
The only reason I bring this up is that pets are smarter than people. They know what side of the bread is butter. I have not ever seen a human kiss up like a pet….
just my humble opinion…
Feral children are running around the neighborhood? I strongly support applying the advice given above:
“The best thing for the would be to be trapped and spayed or neutered then released again”
Spay or neuter the irresonsible human procreators!
California woman sells house to clone pet
http://news.yahoo.com/s/nm/20080805/hl_nm/korea_clones_dc
SEOUL (Reuters) - The loss of Booger the pit bull terrier was almost more than Bernann McKinney could bear.
Now she is happy, minus $50,000 and her house, and owner of five cloned Booger puppies.
“It is a miracle for me because I was able to smile again, laugh again and just feel alive again,” McKinney told a news conference in the South Korea capital to show off the week-old black puppies — all of whose names include the word Booger.
Another bubble blog prediction comes true.
Single Family Homes turn into boarding houses.
———————————————————————
http://sarasota.craigslist.org/apa/783102519.html
$500 dog friendly home with a pool close to Siesta Key (gulfgate/sarasota)
Reply to: hous-783102519@craigslist.org
Date: 2008-08-04, 6:32PM EDT
Nice, furnished, 1,800 sqft home with a screened back porch, large pool and fenced in yard. This home also has a fire place and a very large storage area. It is located near the corner of Clark and Lockwood Ridge just minutes away from Siesta Key Beach. Bedroom has hardwood floors and a ceiling fan with light. Available now.
There is currently a very friendly dog living there, other non-aggressive dogs are welcome.
$500 per month (plus 1/3 utilities) gets you the 12 x 11 bedroom.
You will be responsible for 1/3 of the monthly utilities which vary but average about $150/month. This includes power, water, digital cable and high speed internet.
Security deposit is $200 per room (additional non-refundable $100 for a pet) .
Move in cost will be 1 month plus security. ($700) no credit or background checks, just be clean, respectful to others and have a steady job.
Time for neighbors everywhere to bone up on their respective occupancy/zoning codes…just in case.
A future slum in the making
if you rented in the area you can just leave but if you own……
as for the animals left behind these people should rot in hell
“($700) no credit or background checks, just be clean, respectful to others and have a steady job.”
IOW, convicted felons are welcome!
If you don’t want to run a credit check (stupid, but whatever) that’s your business, but you owe it to your family and your neighbors to at least run an Intellius (sp?) search of public records on the person. They’re relatively cheap and you can run them on anybody without their knowledge or permission. You don’t need a SSN, just a recent town, approximate age, and name. Won’t work if they are using an alias, but that should send off a red flag in itself.
Obviously anyone who has ever been convicted of a crime should be condemned to living under a bridge for the rest of their life, right?
Is that you, Jean Valjean?
If I were a LL, I’d consider renting a property to an ex-con, but I don’t know that I’d want them renting a room in my primary residence with access to my family. Obviously depends on the nature of the crime.
But at the very least, I’d do everything that I could to make sure that I knew as much as I could about the person sleeping down the hall from me. If the person has bad credit because of health, divorce, etc., that might be okay. If the person had convictions for less serious offenses (ie, no child molestation, etc) from a long time ago, then might consider it. But I’m damn sure going to make sure that I know the scope of the potential problems.
Hell, when my girlfriend (now wife) moved in with me, I suggested that we trade credit reports just to so that we knew what was going on. And I had known her for 4 years, since we were both 18.
That’s disgusting. Let bygones be bygones.
Is this really unusual? Tons of homes in nice areas in north county coastal san diego and elsewhere advertise that they are renting out rooms for students and professionals. It’s not a post-bubble thing. Shared housing is common.
I’ve always lived with multiple roommates until I got married. Not because I had to (thought it certainly helped with the bills), but because you can get a nicer SFH instead of an apartment, and it can be fun, if you pick the right people.
$500/mo or more for a room in a shared house seems high to me for that region.
I hope the primary occupants don’t have kids, since they’re not doing background checks.
I’m a man of means by no means—-
King Of The Road…
WCI goes tits up.
No big suprise here. I often walk through their Rivington development in Danbury, CT. They have maybe 100 units built, but the plan was for over a thousand houses, condos and townhouses. Construction stopped about 3 months ago.
About two weeks ago, the prefab construction office (site headquarters) was loaded on a trailer and drove into the sunset. After seeing this, I had been waiting patiently for the bankruptcy news.
Anyone with any thoughts as to who may be next? Seems like Beazer. I’m surprised their stock wasn’t down big yesterday actually.
I’m not sure if any of the builders will survive this.
Some will I’m sure. Some seem to be fairly prudent, in that they’ve ramped down production and have a fair amount of reserve cash - they’ll shrink down quite a bit but will survive even an extended downturn. FWIW I think Toll will do OK. The ones that will certainly go under are the ones that went balls-to-the-wall right up until the end putting up crapboxes - e.g. I see this of Pulte and Centex and Hovnanian. The latter actually is probably the next one to go down, before Beazer even perhaps.
Just a surface view though, looking at the financials and observing the building going on around me.
CT, I’m about 20 minutes from you. As far as I can tell, the entire system is siezed up and beginning to rot and you can’t escape the stink. I see more churn now than ever. Up with the FSBO, then up with the RE signs less than 3-4 weeks later. Back to the FSBO in another 4 weeks. It’s called desperation.
Exeter,
I also see desperation, but not the necessary price drops. I drive up to Dutchess county for my job, and I pass dozens of houses that have been for sale for over a year. Nobody drops their prices, they just change the sign in the front yard. Doesn’t seem to be working very well. I’m not sure what keeps Dutchess country prices propped up, they don’t really have an economy. Beautiful area, but local folks seem to be either rednecks and commuters. Three more years of price drops and you should be able to get a decent house in East Fishkill for $150,000 or a beefy McMansion for $275,000. I’ll keep on waiting.
“Three more years of price drops and you should be able to get a decent house in East Fishkill for $150,000 or a beefy McMansion for $275,000.”
And when that happens that will kill the supports for pricing in this area which has been seen as an escape from high housing prices.
******
Exeter and NYCboy, sorry for mix-up in welcoming NYC back the other day. I swear, I read/write about 10% of my posts while hubby is telling me the kids are in the car, the house is all closed up and it’s time to GO! LOL Hence, many brainless posts.
I’m seeing the same thing here in N. New Hampshire. Lot’s of inventory building but hardly any price drops.
Anecdotal-the wife and I wandered over to a house that was on the market that we felt might be a candidate for inclusion on our “short list” when the time is “right”. It is a house on 20 acres that was originally advertised as being on 40 acres when I first saw it a few months ago. Upon further investigation it was discovered that the owner had passed away almost 2 yrs ago and the family has had it listed for 18 months or so. Since it wasn’t selling they split off 20 acres to be sold as a separate parcel. The house is a 2003 build, about 3,000sqft (bigger than we need by about 50%). The land was purchased in 98 for 83K. Originally 50 acres, they split and sold off 2-5acre parcels for an unknown amount. So, pro-rated they have about 33K into each 20 acre parcel. They have the land listed at 225K and the land/house is 795K (I figure they have about 300K into just the house). I was called by the realtor for my thoughts on the house and I noted how vastly overpriced the asking prices were for both listings. The response was that the guy died and owed a bunch of money that the family was trying to recoup. I mean WTF kind of rationale is that for overpricing a product? Even in this market they are trying to make like 600% on the land and over 100% on the house since 2003. This is the mindset that is pervasive in the RE industry here, it’s crazy. I told the realtor to give me a call if/when the family decides they really want to sell the house and price it accordingly. It’s going to take one hell of an economic crash to get through to dolts like these. Crazy stuff.
Auger, $1000/acre or you’re getting fleeced.
CT - Renter, prices are dropping, just not the asking prices. Look at the transaction prices and you’ll be surprised how reasonable they *seem*….. but it ain’t over yet. Not by a long shot.
not sure what keeps Dutchess country prices propped up
maybe people confuse it with the Dutch country where homeprices can rise forever? Our Dutch prices are now at 6-12x 1990 price level and still climbing … I have been waiting for years for the insanity to end (would like to buy because rents are just as insane in most areas), but the Dutch still believe it really IS different there.
exeter and ct-renter, you are from my old stomping grounds. I lived east of Danbury, gutted it out through the downturn of the 80s, made the daily trek to and from Dutchess. Always wanted to get out, but it took ten years of effort (demographically challenged). Pretty country up there, but views are inedible. The NE experience has left its mark. Renting in No VA, I read survival books for yuks. Strangely, I like hearing about the area, at arms’ length. Thanks for posting.
I’m sorry, did somebody say my name?
Frank Raines OpEd in today’s WSJ
http://online.wsj.com/article/SB121789284562411737.html?mod=googlenews_wsj
- Finally, the companies have not yet received a bailout. Treasury Secretary Henry Paulson asked for standby authority to act, which neither he nor the companies believe will be necessary. Arguably those standby powers would have been unnecessary if the implicit guarantee for Fannie and Freddie had not been so successfully called into question by company critics.
I hope that the Fannie and Freddie opponents will give the new GSE legislation a chance to work. The Congress heard the critics’ arguments and decided that using the companies to intervene in the financial markets to increase homeownership was worth the economic risks. That is the way it works in a
democracyplanned economy.Insiders fault CEO of Freddie Mac
Executives say he was warned about bad loans
By Charles Duhigg
NEW YORK TIMES NEWS SERVICE
August 5, 2008
The chief executive of the mortgage giant Freddie Mac rejected internal warnings that could have protected the company from some of the financial crises now engulfing it, according to more than two dozen current and former high-ranking executives and others.
That chief executive, Richard Syron, in 2004 received a memo from Freddie Mac’s chief risk officer warning him that the firm was financing questionable loans that threatened its financial health.
Today, Freddie Mac and the nation’s other major mortgage finance company, Fannie Mae, are in such perilous condition that the federal government has readied a ***!!!taxpayer-financed bailout!!!*** that could cost billions of dollars. Although the current housing crisis would have undoubtedly caused problems at both firms, Freddie Mac insiders say Syron heightened those perils by ignoring repeated recommendations.
OPINION
Hank Paulson’s Fannie Gamble
By LAWRENCE B. LINDSEY
August 1, 2008; Page A13
Our housing finance system has been broken for quite some time, creating perverse incentives for borrowers and lenders. We have now reaped the consequences, and a major financial bailout of the system is probably inevitable.
Garfield County real estate market is looking bright, broker says
http://www.postindependent.com/article/20080804/VALLEYNEWS/648794207/0/FRONTPAGE
Through June 2008, Garfield County saw about $440.25 million in property sales, a 22.19 percent decrease from the same period last year. During that time, the county posted 917 transactions, down 36.19 percent from last year.
“Last year was a record-breaking year,” Wendt said. “You don’t continue to win the Superbowl every year after year after year.”
“We’re seeing price reductions like we haven’t seen in years and years and years,” he said. “Because some sellers want to sell their property this year.”
But Wendt said the county does have a healthy real estate market because there are plenty of inventory and buyers, and despite the slowdown from last year, the market is still growing when compared to several years of history.
The spin is your friend. I find it amazing how they speak of 22% and 36% decreases, and “price reductions we haven’t seen in years and years” as being good numbers. I would hate to see what they consider poor numbers.
“The spin is your friend.”
So are the spinmeisters. If their spin will pursuade the FBs to keep up with their payments and the knifecatchers to commit their money then we taxpayers will benifit from it.
The War on J6P-
How to turn bad news into good news-
Bad News:
Home values have declined by ______%, the worst in ___ years.
Good News:
An excellent time to buy, prices will not go any lower. Buy now or be priced out forever.
This add was brought to by all the boomer English major/college graduates who went into marketing instead of the law.
lol
This add was brought to by all the boomer English major/college graduates who went into marketing instead of the law.
————————
wtf? this doesn’t even make sense . . . its not just boomers now, its English majors you have a problem with?
I’m so tired of everyone triumphantly blaming the other generation for all the problems . . .
Like there aren’t ANY sleazy marketing gen x/y people out there.
LOL, “add” is math, “ad” is advertising - I know spelling corrections are lame, but I always think its ridiculous when super smug comments contain misunderstandings of words.
peaceful,
I am a liberal arts (read pol sci) boomer/graduate!!!
I think I know a little something about what I am talking about. By the way, whether boomer/gen-x and the other gens) what do you think the liberal arts graduates do to earn an income? Possibly law, sales, marketing, govt employee? They are not engineers or scientists!
lol, imho.
sorry, I forgot my fav profession (my unfortunate career), insurance. The only one available at the time of my first real job search, however stayed in due to the fear of loss of income, which by the way, started from a low base salary.
lol
Peaceful,
sorry to hit an exposed nerve! By the way, add (and not ad) teaching, politics and advertising.
Just out of curiosity, where do you think all those liberal arts college graduates are doing to make a living. Plumber, Electrician, construction? The Vietnam produced a whole lot of college graduates, flooding the job market in the 70s. I ran into individuals working on their Phds working at the USPS to survive.
Just one person’s experience.
I was in the advertising field and produced thousands of “ads”. Never saw anyone spell it any differently than ad. Well maybe some people outside the field.
Course, that was in the years before spellcheck when people had to know. Who knows what’s acceptable now (in a doublethink society).
The physicist asks, why does it work?
The engineer asks, how does it work?
The account asks, how much does it cost?
The liberal arts major asks, would you like fries with that?
The mathematician says, “Work? It’s supposed to work? I just thought it was an elegant proof.”
Thank you, now I understand the costs of my education was worth it. Hopeful I will be ahead of the illegal and the uneducated in the unemployment line….
The Illegal will be back in Mexico and the uneducated will not know how to get TO the unemployment line so there you go….
The engineer says, “Why? You mean we have to find a buyer for this thing?”
Record High Farm Real Estate & Pasture Values
http://www.cattlenetwork.com/Content.asp?ContentID=241959
Both cropland and pasture values for 2008 are record highs. Cropland values rose by 10 percent to $2,970 per acre, up from the previous high of $2,690 in 2007. Pasture value rose by 6 percent to $1,230 per acre.
The next real estate bubble or just catching up from depressed values?
Demand for beef is expected to increase by some obscene amount of the next 10 years, mostly driven by Asia. That will also further drive up the cost of corn. So the increase could be driven by market fundamentals for now.
The problem with paying a premium for land during an agricultural boom is that eventually supply catches up with demand and overshoots. There is a lot of undeveloped land in South America (rainforests) that would make good agricultural land. It’s just a matter of cutting it down and cultivating it. Like new oil drilling, the potential for supply to meet new demand is available in the medium term (5-10 years), which should ultimately ease prices.
I wouldn’t call it a bubble, as the prices being paid right now are likely justified by the income potential. A bubble is defined as asset prices exceeding their income potential, but driven by speculators chasing capital gains. So while the market will eventually overcompensate for the high prices, at which point the land will be worth less, at the moment the prices are possibly justified. So that’s not a bubble in the classic sense of the term, although eventually the people buying up farmland may come to regret their decision.
There is a bubble in certain sectors of the agriculture market, especially irrigated land in the High Plains and possibly a large portion of the land in the Midwest. There are also several hedge funds and other investment types who have no clue about agriculture buying hundreds of millions of dollars worth of land. They’re chasing a % return based on some idiot’s BS outlook for the future. I’ll say that commodity prices may not fall all the way back to previous lows, but I think they’ll get close at least for a period. If there is one thing we can do, it is overproduce grains.
Wasn’t it last March that it was announced the the world was running out of wheat and millions were comdemned to mass starvation? Then shortly later the world began running out of rice?
Look at the prices of wheat and rice then and look at them now.
Lol.
New realities.
I do every day.
Soybeans are $12.60/b at cbot today and were $11/b in April and were $10.00 nov 2007 $8.50 Aug 2007.
A real price break down. All grains look just like this. Rice is 50% higher than last November.
It still looks like a shortage. You sell it with your money, not mine.
question for hoz:
I try to follow the commodities market, and for the agri stuff I check Rogers RICI Agri a few times a week (it should be representative for Agri commodities and is one of the easy ways to buy into this market over here; fund is demoninated in euros here).
RICI Agri has been trending down strongly since its peak on March 1, 2008 and is now about 15% above the LOWS of the last year (and around the average value for 2006 and 2007). Nothing bubbly to see there … is there something wrong with this Rogers fund, or why is there no sign of a ’shortage’ in the chart?
But if you are paying for bread at a grocery store lately, who gives a flying fig?
” There is a lot of undeveloped land in South America (rainforests) that would make good agricultural land. It’s just a matter of cutting it down and cultivating it.”
You’re not talking about sustainable agriculture here.
Good farm land is actually in limited supply and will become even more limited in the future. Supply is droping and demand is increasing. Lots of land that depends on irrigation will be lost (climate change, see South West US), as will land with excessive soil erosion(cut down rain forest) or land used for urbanization.
$3000/acre is still peanuts when you consider the amount of food you can raise on 1 acre of GOOD farm land. It’s not like you can get Beazer to build you a few more acres of farm land any time and anywhere you want.
Some jackass academic back in the 60’s wrote a book about how the earth was running out of cropland and that continuing population growth would bring about mass famine in less than 10 years. Unbelieveably, he’s still a respected academic. I wish I could remember his name.
he wrote a book called ‘ the population bomb’. Paul R. Ehrlich.
Right about the time he wrote that book, Norman Bourlaugh was initiating the ‘Green Revolution’, a remarkable program of selective crossbreeding to eliminate the most common losses of crops, essentially saving the world. Norman Bourlaugh is a hero.
Was that book called, zero population growth?
It turned my sisters into socialistas.
The population bomb has only been temporarily defused and is still ticking. Modern industrial agriculture is very chemical and energy intensive. In the increasing scarcity of such things, what will happen to the ability to maintain yields at current levels?
Cosgrove,
What is going to happen is twofold - there will be a shift to how we move and harvest crops, probably to electric power. The reason is that there is cheap energy in Nuclear. When we embrace it is just a matter of how expensive it gets to make oil. The more we let oil rise in price, the more we’re forced to turn to other means of energy.
Secondly we will continue to increase yields and direct food to only for consumption purposes… no more corn based ethanol, no more corn-based plastics.
And don’t forget the biggies — corn-based beef. While on the subject of far-seeing environmental wackos from the hippie generation, don’t forget John Robbins, who called for an end to meat in Diet for a New America. While he himself is a total vegan, his organization (last time I checked), only advocates that people eat LESS meat, not no meat. Cutting meat consumption in half would free up incredible amounts of arable land, water, and fertilizer.
And I read someplace that half of our corn goes to high-fructose corn syrup for Coke and Cranberry-juice-blend- cocktail-drinks.
Luckily, food production was increased by the use of oil derived fertilizers and we won’t be running out of oil anytime soon.
Cars and cows: a large percentage of global warming can be traced to cars and cows. If you limit your usage/intake of these , then you are helping the earth.
I agree with some of the posters above that the ‘Green Revolution’ was just a temporary bandaid, and the food problem will return with a vengeance when Peak Oil and global warming sets in. Vulnerability to energy prices and climage change has been hugely increased by the ‘clever’ people that forced the Green Revolution on the world (a lot of this was coming from Wageningen University in Netherlands). At least I hope that crook companies like Monsanto etc. go down with modern agriculture when things get out of hand.
Oh, we can debate how close we are to some population limit but its all caveman specualting about starflight.
Too hard to predict.
Global warming may not harm food production at all. Initial trends indicate most of the US is experiencing an increase in rainfall. Other crops yield may have increased as a function of more CO2. Plenty of data on that.
California and Arizona might be in trouble from a water perspective though.
Probably get some big public works water projects in the southwest to solve these problems though.
There has been a lot of innovation in the ag industry to increase yield too.
The other problem with this analysis is that China and the US might be hitting population peaks together. First the US and China not long afterwards due to the one child policy. So, poof China is going to be suddenly old. Any idea of the deflationary effects of negative population?
I can’t remember any nation facing a decreasing population size having any kind of food problems absent some kind of natural cataclysm. Or government planning.
Active aggresion is also rare. Why go out in source of resources when you have plenty at home? Passive aggresion is pretty high though… see france as an example.
So, I’m predicting big surplusses of corn/wheat/oil/water in the next two years.
Someone please correct me if I am mistaken, however I remember from the deep dark past that around 50% of all land (I assume area) west of the Mississippi, is owned by govt (BLM). I also recall that ranchers graze their livestock without paying a fee?
Am I wrong here?
PS. Yes, I do understand a lot of the land non-arable, National Parks and Military reservations, however…
The 50% number is pretty close. Ranchers pay a fee to graze on federal land. I was talking to one of these ranchers a couple of weeks ago on some national forest land, I think he said the fee was a couple dollars a head per year, but don’t quote me on it. BLM is $1.35 per head this year.
A dollar doesn’t cover the costs of increased erosion, wildfire risk, invasive species, and destruction of vegetation and wildlife habitat caused by ranching. The drier the lands, the more easily destroyed they are by grazing. Not sure why beef is worth it.
“Not sure why beef is worth it.”
Because you can’t taste fear in a salad?
Bull crap. A buck a head is a good price.
Marc Faber said to buy farmland three years ago. He was right.
D.R. Horton posts smaller 3Q loss on lower charges
http://biz.yahoo.com/ap/080805/earns_dr_horton.html
Fort Worth, Texas-based D.R. Horton posted a loss of $339.3 million, or a loss of $1.26 per share, compared with a year-ago loss of $823.8 million, or a loss of $2.62 per share.
The latest period includes pretax write-down charges of $330.4 million, compared with bigger charges of $852 million last year.
Revenue dropped 44 percent to $1.43 billion from $2.55 billion.
Analysts surveyed by Thomson Financial expected a loss of 70 cents per share on revenue of $1.44 billion. Wall Street estimates typically exclude one-time charges or gains.
Smaller 3Q loss, but the numbers were worse than estimated. Funny how the smaller 3Q loss makes the headline. Sorry, it’s a cynical look at the news day for me.
Boy do I need some help here. Am I reading this correct (see public record below)? Did Wells Fargo just give these people a loan with 1% down? This house has no garage. Is circa 1800sf. You need to go outside to enter an earthen basement. I could go on but you get the idea. I’ve been watching this house for well over a year. It was last listed at 509K. Wife and I agreed we wouldn’t pay more than 325K.
http://tinyurl.com/694rln
Sure looks that way. Their first (and apparently only) mortgage was for $485k and some change for a house that sold for $490k. Maybe they did something where the downpayment was higher but they capitalized closing costs? Very strange.
I’m not exactly sure how to read it, but it looks as though the buyer and the seller are related (surname: Palermo). Am I missing something?
Is it possible that banks still think there are some people out there who are good risks for a 1% down mortgage? Are these kinds of mortgages the result of government bailouts, stupid underwriters or is it fraud?
BTW, a one-month decline of 17 pct occurs at an annualized rate of
((1-0.17)^12-1)*100 = 89 pct. If this rate of decline persisted for another eleven months, we could see oil prices back to early 1960s levels by year end. I fondly remember those $0.40/gallon gas prices. (Just a hypothetical illustration — not something I consider highly probable.)
IRWIN KELLNER
The law catches up to oil
Commentary: Prices can’t outrun the long arm of supply and demand
By Irwin Kellner, MarketWatch
Last update: 11:22 p.m. EDT Aug. 4, 2008
PORT WASHINGTON, NY. (MarketWatch) — It had to happen sooner or later: Oil prices have finally succumbed to the law of supply and demand.
Monday’s drop of nearly $4 in the price of oil for September delivery to little more than $121 a barrel is only the tip of the iceberg. At one point, this benchmark contract traded as low as $119.50, breaking below $120 a barrel for the first time since May 5.
Besides plumbing a three-month low, the price of oil has now fallen nearly $25 a barrel, or close to 17%, from its all-time high reached just about a month ago.
I sure hope some hedge funds blow up to smithereens on this oil price move :-).
Huge sell-off leaves oil at 3-month low
Analysts expect relief at pump to continue
By Stevenson Jacobs
ASSOCIATED PRESS
August 5, 2008
NEW YORK – Oil prices plunged to a three-month low yesterday, briefly tumbling below $120 a barrel in another huge sell-off after Tropical Storm Edouard seemed less likely to disrupt oil and natural gas output in the Gulf of Mexico.
Crude’s steep drop – prices fell more than $5 at one point during the day – dragged down other commodities from corn to copper and mimicked the big nose dives of the past three weeks, adding to growing beliefs that the oil bubble is at least temporarily deflating.
“What this means is that we’re going to see some more relief at the pump. We’re probably looking at another 10 cents of downside in retail gas prices,” said Tom Kloza, publisher and chief analyst at Oil Price Information Service in Wall, N.J.
“I sure hope some hedge funds blow up to smithereens on this oil price move”
My guess is that slightly more hedge funds made money over the recent drop than lost. Some would have had to lose, obviously, because they make up such a large volume of the trading. But my guess is that quite a few amateur investors just got scalped.
Maybe it is different now, but if history is any guide, there are some highly leveraged hedge funds which bet the wrong direction on oil prices which are currently in the process of blowing up.
I think it is mostly pension funds and the like that are participating (in the wrong direction) in the commodities market now. Several Dutch pension funds reported big losses for first quarter of 2008 that were partly compensated by relatively huge gains in the commodity markets in the second quarter. I’m pretty sure they are still invested in commodities (as most of them are still invested in Fannie and Freddie paper as well).
Screw the Dutch. They are a bunch of Dutch Dummies, and make up the wooden shoe of the world.
And the worst part, as they are in my family. Eradicate them.
seeing this on Marketwatch and AP, isn’t that a sure sign that the decline in oil prices is nearly done for now?
IMHO, the runup in oil price over the past year has a much to do with the decline in the USD and speculators than supply and demand.
A few months ago, speculators pushed the price near $150. Its now receding to the levels supported by the fundamentals and currency exchange, which is around $100-120/bbl. If/as the dollar strengthens, it will drop back down to $80-100. If the Fed continues to overinflate the economy, then prices will continue to increase back to $150 and beyond.
But this is a currency devaluation problem first and foremost. And that’s something that is the power of the US Government and the Fed to do something about, albeit with significant short-term pain. But hedge funds are making too much money on oil speculation at the moment, so the Fed isn’t in a hurry to help fix things for consumers.
Totally agreed. The fundamentals-based explanation (supply and demand, Peak Oil, etc) is a convenient smoke screen for the Fed to hide from the harsh spotlight of Milton Friedman’s dictum: “Inflation is everywhere and always a monetary phenomenon.”
Gee walt, to hear Larry Kudlow tell it, the price of oil is dropping because everyone knows America is going to flood the world w/oil now that we’re talking about opening up off-shore drilling.
/Kudlow aimed snark off
The price of oil and gas has too many factors to pin on a single event. What I think really happened is that the market finally found the psychological break point at $4.00/gallon. They thought it might be $2, they were sure it would be $3, but didn’t see significant changes in driving habits until $4.
As for offshore exploration (it’s NOT drilling yet), in the 7-10 years it would take for that oil to make it into my Toyota, I could be driving a plug-in hybrid instead. Even at 50 miles between e- charges, that’s, what, 70-80% of daily driving without using a single drop of gas?
That’s what oil companies are deathly afraid of.
I’m with the line of thinking that noticed all commodities are falling off their highs, not just oil.
Some hedge fund or two decided to unload, at least temporarily.
I have been reading up in the Honda Civic that is powered by CNG. Honda has been surprised by the demand and are thinking of making more than 2,000 of them a year.
Every article about it mentions how it is limited to only 250 mile range and how that would cause major problems for American drivers and CNG should only be used for buses because of this limited range.
skip: how many americans are driving more than 250 miles on a daily basis - Is this really a problem or just a psychological problem?
In Europe most people use their car mostly to drive to work (usually within 20 km, in some cases possibly 100km) or to visit the postoffice, supermarket etc. (usually a few km drive). Of course people who are on the road the whole day for their work, or people who go on vacation would have problem with a 250 mile range, but for daily life I think many people could adjust.
On another note: LPG was popular some time ago in Netherlands because of low prices and low pollution. But after people had their cars converted for LPG, the Dutch government decided to strongly increases taxes on these cars (even higher than for old diesel cars) and the price at the pump has increased even more than for oil, relatively.
“Hopefully this price won’t be so low as to cause us to forget to conserve.”
People have short memories when it comes to pain at the pump. If gas gets down to less than $3 a gallon for a few months, the SUV will return in force.
I also find it interesting that over the last few weeks I hear less and less about the energy demands of China and India increasing, the threat of Iran, hurricane season, diminishing easy oil, but more on how US consumption is decreasing. If the developing countries use more, even if the US uses less, supply will still be a long term issue. While relief at the pump is welcome, it won’t last long if people return to their guzzling ways and government continues to merely try and drill their way to a more secure energy future.
“Hopefully this price won’t be so low as to cause us to forget to conserve.”
Hate to tell you this, but that’s exactly what happened during the 1980s. We forgot the conservation lessons we learned during the ’70s.
Humans are energy-hogs. As long as the chicks dig guys with fast cars who make lots of money, there really isn’t any way out. It’s up to you, ladies. Establish a new standard of what you look for in a man. If ladies continue to view the rich, jet-setting businessman as the ideal, then men will continue to try to achieve that and will consume the resources that lifestyle requires.
If ladies view the local organic farmer or bicycle rider as the ideal, then men will change their energy-consuming behaviors in a hurry.
As long as the organic farmer or bicycle rider is rich…
What does organic farming have to do with saving energy? The opposite is true actually - organic farming takes more energy (and uses more land) than other forms due to much lower yields per acre.
Yet another example of the sheeple being grossly misled by marketing and the MSM.
Actually, yields per acre can actually be higher in organic farming if you’re rotating the fields, and it certainly uses less energy if you aren’t feeding animals corn and using chemicals on produce.
If ladies view the local organic farmer or bicycle rider as the ideal, then men will change their energy-consuming behaviors in a hurry.
Plenty do, but they don’t hang out in places where the men with the big shiny cars hang out.
“As long as the chicks dig guys with fast cars who make lots of money, there really isn’t any way out. It’s up to you, ladies. Establish a new standard of what you look for in a man.”
I had to laugh (with love, of course) at this since the only men I see driving those cars in this locale are at least 60 years old. And they’re often not even in good shape! I always feel very disappointed that I bothered to look and didn’t get a beefcake shot.
Btw, I never cared what any of the men I dated drove, and I’ve had the “babe” label thrown my way a few times. I was just looking for someone who had some respect for my interests and passions and had the energy to keep up.
I’m pretty sure that the problem isn’t that chicks dig guys with fast cars. The problem is that guys want to think that chicks dig guys with fast cars. It is way easier to get your hands on a fast car than to become an interesting person. Besides, the car companies spend a lot of money convincing guys that chicks dig guys with fast cars.
Speaking of which, what is the deal with the free credit report/triple advantage commercials where the guy has bad credit so he has to buy a small car, not a tricked out car? If he has really bad credit, why did he get a loan for any car? And the pirate restaurant guy? Why does having bad credit get him a job at a tourist trap fish place? Is is instead of some other job that he could have gotten with good credit? Or does he need the job because he can’t get a credit card? I find those somewhat baffling.
God I hate that ad.
LOL,
I loved your response Polly.
I think that Pirate restaurant job is a 2nd job because the cost of his credit is working against him, and the car commercial is suggesting that’s all he could qualify for given his poor credit rating. Probably dated concepts, given the reality of contracting credit to all credit levels. And it doesn’t suggest that buying what one could afford might have put him in a better position in the first place. But the music and idea of getting back to hipster status does grab the attention and probably does get the switchboards to light up for them. My kids know all the lyrics.
…..”If ladies view the local organic farmer or bicycle rider as the ideal…..”
More men will declare themselves gay.
What is the effect of falling oil prices on oil demand?
What? Falling prices INCREASE demand? Oh.
Face it people, in another few years, the “experts” are going to be crowing about oil’s “crash” from $300 down to $250, the same way they are talking about the “crash” from $150 to $100. Nevermind that people were complaining about $50 oil just two or three years ago. Oil is coming back down to it’s long-term trendline on a monthly chart going back to 1995 or so. That’s all.
On the other hand, if oil goes back down to $50, I’m taking my family on a cross-country driving trip by RV, and I’m probably not the only one.
Too late for DUG?
There is good support at 100. This correction is looking tired.
Your gold bubble is looking mighty lethargic.
Short gold, then. You are sure it’s a bubble aren’t you?
Lol. Oil isn’t looking all that well either.
No offense to true believers, but I have no interest in gold as a short or a long investment, as I fail to see the near term certain financial Armageddon frequently cited by the faithful as reason to horde the shiny yellow metal.
Given your track record (bearish on gold since at least 600), that is probably a wise decision.
My, my. Got a burr in your saddle re: Big Oil?
Another easy money channel is constipated.
Credit-Card Bonds Fight A Tougher Debt Market
By Aparajita Saha-Bubna and Prabha Natarajan
Word Count: 814 | Companies Featured in This Article: American Express, Bank of America, Citigroup, J.P. Morgan Chase
Investors are growing wary of bonds backed by credit-card payments, jamming up another debt market and making it tougher for Americans to tap what has been one of the easiest places to get credit.
Rising defaults on credit-card payments, coupled with a bleaker economic outlook, are spooking investors in the market where this debt is packaged and sold. In July, issuance of credit-card asset-backed securities fell to $4.4 billion from $5.26 billion in June, according to J.P. Morgan Securities Inc.
July’s total was down 56% from the $10.08 billion issued in March.
Retail is screwed. Christmas sales are really going tank if Joe and Jane Sixpack can’t buy a few thousand dollars worth of useless junk for darling little Dylan and Sierra.
I’m damn near done w/ christmas shopping!
Every month, lately, we get these pestering calls from Verizon (our wireless provider). “Did you pay your bill yet? Are you gonna pay your bill? Do you want to pay it over the phone? Do ya? Do ya? Well do ya? Huh? Huh? Huh?”
My wife asked the gal: “What’s going on lately? Are you guys having trouble?” The gal from Verizon confided “well, a lot of people are having trouble paying their bills”. She didn’t elaborate, but we concluded that they’re trying to milk the customers who ARE paying to keep the cash flowing. Tough times ahead methinkest.
I remember going through prospectuses, for my daughter’s college savings a few years back.
Hmmm — long term investment grade, don’t want that with the potential for interest rate and inflation increases and mortgage bond defaults.
Short term investment grade? Credit card securitizations! No way!
So I went with intermediate term investment grade. Probably got SUV loans securitizations.
You really can’t win.
We recently bought a new van — with cash. Given the War on Savers, why waste money letting it sit in a nearly-insolvent bank when you can park it in a real asset which doubles as an inflation hedge?
A motor vehicle is an inflation hedge? Gosh, my ‘99 Ford Escort must be worth a lot more than I paid for it by now!
LOL. Indeed.
PB, I generally enjoy your posts every morning, but a vehicle purchase as an “inflation hedge” is a pretty silly idea. And that’s putting it as politely as I can.
With such a glut of large Class C vehicles already on used vehicles lots and automakers with record-high inventory levels of new vehicles, the accelerated expected depreciation of any SUV, truck, or van bought new right now will offset any inflationary hedge benefit. And with such low financing available on those types of vehicles, paying with cash may not make sense if you are expected high inflation.
“My ‘99 Ford Escort must be worth a lot more than I paid for it by now!”
Next time try buying Japanese.
True story: My first Japanese automobile was a 1980 Honda Civic. I bought it for a song in the mid-1980s, and it was smallish with cramped leg room and already showing signs of rust on the paint. When I sold it in 1989, I assumed that given the rust and the 100,000+ miles odometer reading, I would be lucky to get $300 for it. I listed it for sale in the paper and included my phone number in the ad.
After work the first day I listed it, my answering machine was full of calls from folks who wanted to buy my car. I checked the Kelley blue book and discovered it was actually valued at over $700. I relisted it and sold it for over $700 in a matter of a couple of days.
Same here.
1988 Honda Civic bought for $3000 circa 1996 (impeccable shape) sold for $2500 circa 2002.
$500 lease for 7 odd years. Not so shabby.
“$500 lease for 7 odd years. Not so shabby.”
Sounds to me like a damn good inflation hedge.
After work the first day I listed it, my answering machine was full of calls from folks who wanted to buy my car.
Hondas are workhorses, and demand for them has always been strong (demand has been strong since I’ve been old enough to drive, at least).
I had little problem unloading my ‘91 Accord wagon a few years back despite 331,000 miles on it.
Having said that, automobiles generally depreciate at a sickening rate.
Inflation hedge? Sounds to me like someone doesn’t understand the nature of currency devaluation. Hint: compare list price for a car made in 1980 and 1989. The newer car costs more in fiat. Therefore, a 1980 car is worth more green rectangles in 1989 than you pay for it in 1980 (all other things being equal, which they are not), but those green rectangles do not buy as much car as did in 1980.
Had a friend in 1984 that bought an older Ford Escort for $2000. He already had a ‘68 Vette that he bought to do body work on as a distraction from some health issues, and a Jeep. But the Escort was his commuter box.
He used to drive an hour and a half to Manchester from the seacoast to get cheap parts from the giant junk yard there. He probably never spent more than $70 on that car.
Then he sold it 3 years later to his neighbor for: $2000.
If you’ve written this guy off as a grease covered car junkie….well, you’d be partially right. Except he also was known as “The Doctor” among his code writing peers. Saved many a gunked up piece of software w/his knowlege according to co-workers.
“Sounds to me like someone doesn’t understand the nature of currency devaluation.”
Sounds to me like someone else doesn’t understand the nature of gold price deflation.
those state plans sck-if you want to self direct in my state you pay 4-5% loads
http://www.chicagotribune.com/business/chi-re-fannie-unsold-home-0803aug03,0,2646891.story
Fannie faces glut of unsold homes
Mortgage giants own 44 percent of foreclosed homes
Fannie Mae and Freddie Mac, the country’s second-biggest mortgage finance company, together owned a record $6.9 billion of foreclosed homes on March 31, compared with $8.56 billion held by all 8,500 U.S. commercial banks and savings and loans. Foreclosed houses sell at an average discount of about 20 percent, according to economists Ethan Harris and Michelle Meyer at New York-based Lehman Brothers Holdings Inc. At that rate, the two mortgage companies stand to lose $1.39 billion on the foreclosed houses they currently own.
This guy seems to have noticed all the elephants suffocating under the US housing market’s living room rug.
How to Shake Off the Mortgage Mess
July 30, 2008; Page A13
Where are the hosannas for Congress’s handiwork on housing? Nobody expected it to solve anything, but it’s worth understanding why.
By CNBC’s count, the federal government has already made roughly $1.4 trillion available to refinance mortgage debt since the housing meltdown began. That makes this week’s bill, which adds another $300 billion to the pot, seem a mite anticlimactic. The key word is refinance. Even if this money helps prevent foreclosures, it’s aimed at houses that people want and that would likely resell even if foreclosed. Hardly touched is the real problem of tens of thousands of houses financed during the subprime boom that are unoccupied, unwanted, falling apart, built on spec, mortgaged on spec and abandoned on spec.
Washington has practically monopolized the business of financing and refinancing home sales for willing buyers and sellers, but it does nothing about the homes going rancid on the shelf, souring the value of the nation’s entire housing stock and mortgage debt.
This news really p!sses me off: In order to save lenders from their bad gambling debts, taxpayers are coerced into collectively owning thousands of homes that are crumbling into desuetude, thereby keeping homes off the market to prop up prices at unaffordable levels. Meanwhile, we get to keep on renting at a premium to the fundamental (unmanipulated) value of housing.
I guess I am turning into one of Dick Armey’s angry renters now. Too bad the central planning isn’t working, as evidenced by a collapse of demand and resale home prices falling at double-digit levels nationwide. What is the gubmint going to do with its huge stash of empty, devaluing houses? Sell them at fire sale prices, or demolish them (either at the taxpayers’ expense)?
“Take Fannie Mae and Freddie Mac, which owned 62,000 homes in the first quarter and were acquiring houses twice as fast as they could sell them. Fannie and Freddie now are statutorily backed by taxpayers, so taxpayers now are the real owners of nearly as many foreclosed houses as the rest of the country’s 8,500 banks and thrifts combined.
And that’s just the beginning. In seizing IndyMac, a California lender in subprime heartburn country, the FDIC put its fingers in its ears and simply declared a moratorium on new foreclosures. Taxpayers will end up owning a lot of derelict homes through FDIC too.
None of this is reason to disregard glimmers of a bottom in housing. Housing markets are local. Even with an unprecedented 19 million empty single-family homes, apartments and condos hanging overhead, some 500,000 new houses a year continue to be built and sold — because people want houses where they want them.“
“…Even with an unprecedented 19 million empty single-family homes,”
Bugs: “eh Daffy, how come you never owned a duck pond in Minnesota, they say they are a land of 10,000 lakes?”
Daffy: Well Bugsy, the thing is….they are also, the land of 100,000 duck hunters!”
Bugs: “eh,…I see!… said the blind man, as he picked up his hammer & saw.”
Though I found this Op-ed piece entertaining, I really think this guy is full of sh!t. Why would it be in the best interest to demolish homes rather than letting Mr Market find a price where a willing buyer is forthcoming? I suppose I just don’t get the wisdom of wasting our nation’s collective wealth on building a plethora of new homes, only to destroy them before they are ever occupied. Don’t these idiots realize they are espousing the Communist principles of economic governance through central planning which led to the demise of the Soviet Union?
So far, Washington has put its political capital into trying to refinance salvageable homes for unsalvageable homeowners, when a relevant policy would consist of judiciously buying unsalvageable houses and demolishing them. Fannie and Freddie’s strength is housing market software: They could be put to work devising a least-cost, maximum-bang strategy for demolishing unoccupied homes to preserve as much value as possible for the homeowners and mortgage creditors who remain.
Yes, I posted this a few days ago. I used to be a big fan of Holman Jenkins, but he has really gone off the deep end with this latest crusade about using taxpayer money to demolish houses.
The biggest laugh is this:
“Fannie and Freddie’s strength is housing market software”
I worked on a software system for Fannie Mae, and it was like any other bloated inefficient incompetent big company IT project. If that’s their strength, well I guess I know why they need this bailout.
First taxpayer monies were used to subsidize a ginormous building boom. Now people like this Communist want to use taxpayer monies to demolish homes. Why oh why is the stupidity of this idea not perfectly obvious?
We still pay farmers not grow crops and give tax abatements to oil companies don’t we?
Last I heard we still had a Strategic Helium Reserve in Amarillo in case of a dirigible war.
Once you embrace the Absurd, it is much easier to understand these things.
“We still pay farmers not grow crops and give tax abatements to oil companies don’t we?”
We also provide farmers with heavily subsidized crop insurance (there is very little participation if the insurance is not heavily subsidized). But for good measure, Congress often throws in additional ad hoc bailouts in the wake of agricultural disasters — not all that different from last week’s ad hoc GSE bailout. These policy measures are very, very good for generating future Congressional campaign contributions.
I embrace and am surrounded by the absurd daily.
I live in the San Francisco Bay Area.
Jack — Been there, done that. You aren’t a racquetball player, are you?
Umm…. not in a long time.
I smacked that little blue ball around for a short while as a kid, when I was probably 12 years old or so. Between hockey, ski racing, baseball, soccer and tennis, I had too many other things to do.
Perchance you have me confused with “sf jaack”?
For some reason, said person chose that very similar new handle over at the forum.
I used to play racquetball with an East Bay real estate franchise owner named Jack. He and his employees were great competitors, and I appreciated their honesty about the housing situation (circa 2004). One of them intimated that he himself would not buy a home under (then) current market conditions.
Shelters in our area regularly turn animals away due to overcrowding. It was that way before the downturn so I don’t expect any help from them as layoffs continue.
Personally, I find it discouraging how many people simply dump their pets. I’d live in a lesser place where I could keep my pet if the alternative was abandoning them. In fact, I do live in a lesser place due to my pets, but I’m very happy to have them as an impressive layout doesn’t replace love and loyalty.
I agree with you. I live where I live because of my animals, who an infinitely more important to me than any building.
I always lived in the worst places just to live with my pets. I guess it’s a maternal instinct with a twist.
I live now in a nice rental home but in a part of SD that has few German cars and fewer blond brats.
Ahhhhh….here’s where that post wandered off to.
For those who have paid attention to my comments on public employee pensions, prepare to vomit.
http://www.nytimes.com/2008/08/05/nyregion/05pension.html?_r=1&ref=nyregion&oref=slogin
“To cope with a growing number of retiring baby boomers and a shrinking state pension fund, the state comptroller said on Monday that he would ask the Legislature to permit a larger share of state pension assets to be placed in less-traditional investments. The part of the pension fund that can now be placed in such investments, like private equity and hedge funds, is 25 percent. But the comptroller, Thomas P. DiNapoli, said that those restrictions limited the state’s options for increasing the fund’s assets at a time when more traditional investments like domestic stocks are experiencing volatility and the pool of retired state workers is expanding by the day.”
It was lifted from 15 percent in 2006.
Here is what I think is going on. The state legislature has been handing out pension sweetners for years, and these have always been described as zero cost to taxpayers — an 8 percent return beginning in 2000 would pay for it all!
And now the Comptroller knows he is sitting on losses, and will have to demand more money from the state and local governments in the middle of a fiscal crisis. Unelected, he was appointed when the former Comptroller went down in a financial scandal — his investments are still under investigation. He is up for re-election in 2010.
(You have an unelected Governor who took office when the former Governor went down in a sex scandal. And the state legislature is unelected (and all over 60) because (de facto) it is illegal to run against an incumbent in New York State. I know, because I got fed up and did it some years back.
Anyway, the hedge funds are probably also sitting on losses, and their “sophisticated” private investors want out. So who buys when they sell? A match made in hell, where many of these people will be going. You really think Blackstone is going to re-sell companies purchased with massive leverage in a boom into the stock market in a recession? NO, they are going to dump the steaming pile on what is left of the future of New York.
This is a friggin crime!
I see a big need for reform here:
-Reduced expectations of pensions
-Improved tax base to pay for “reasonable” pensions
-Changed expectations of a “reasonable” market return
-New ideas for revenue generation
-Transparency and political action as required
NY tier 1 = poster child for gov worker unions
who are they voting for ?
“to permit a larger share of state pension assets to be placed in less-traditional investments”
Mmmmm….um…ya know you did warn us. But, Zesty Azteca Meatball & Rice doesn’t look so pretty on the keyboard.
I think I’m going to be placing my assets into a less than traditional place….such as not next to the family and friends who remain in support of this state no matter what type of craziness is thrown at them.
Which reminds me, the first line of your quoted text should have been:
“To cope with a growing number of retiring baby boomers and a shrinking state pension fund,” as well as an exodus of our state’s creative class needed to support those that are left behind
“To cope with a growing number of retiring baby boomers and a shrinking state pension fund.”
It shouldn’t matter how many retire, because the pensions are fully pre-funded during their working careers, right?
Bwaahaa—waaah!
Giant smiles and a big 10-4 on that comment, WT!
Barclays is forecast to reveal a 35% drop in profits to £2.6 billion as bad debts around the world, particularly in South Africa, combine with further losses from its exposure to the credit markets.
Giving the finger to urban idiots.
http://news.yahoo.com/s/ap/20080804/ap_on_fe_st/odd_car_fence
I love the attitude of the neighbors.
“We want a view of your cows and pasture, cute as a Thomas Kinkaide. But the cows must not moo, poop, move around, or attract flies. Actually, could you just ranch some stuffed cows?”
This is why every elementary school should have a mini barnyard and vegetable garden. People need to understand that prosciutto and marinated skirt steak are not birthed fully formed in the back room of a Trader Joe’s.
I love the smell of Nutrient Management in the morning.
I like Mr. John Dizard
Monoline firms might be sick, but they are not dead
“…By now any reader of the Financial Times knows that the monolines, once extremely dull guarantors of equally dull, but more obscure US municipal and state government bonds, went crazy with their pens in the last decade.
They collected premiums for guaranteeing the complex debt securitisations that have come so noisily undone, particularly those backed by housing assets. Their AAA ratings, already devalued by investors, have been lost in many cases, and new entrants such as Berkshire Hathaway, with solid AAAs, are likely to take much of their market share.
So what is the point of buying such stocks as MBIA, Ambac, Security Capital Assurance (SCA), or related companies such as XL Capital? Because they have the keys that the vulture investors need to get into the next cash box….
Sean Egan, of Egan-Jones, the buy-side-paid-for ratings agency, would caution the prospective monoline stock buyer. As he says: “[Most of] the monolines are in run-off mode now, and [the workouts and unwinds] don’t restore the ongoing business value. It will be very difficult for the monolines who lost their high ratings to regain them.”
But we’re not building a business, we’re rifling the pockets of a sick business that’s been left on the Street. Not pretty, but it could pay out well.”
http://www.ft.com/cms/s/0/0f94dfd0-62a1-11dd-8ed5-000077b07658.html
I am starting to think about buying some gold, though it might still be quite early. Any thoughts about the best way to do this without physically owning the metal?
“Any thoughts about the best way to do this without physically owning the metal?”
At its present price, I don’t see it as a worthy inflation hedge, as it seems just as likely to lose value as gain value in the medium term. It seems to me that the only reason for holding gold right now is if you anticipate a collapse of the financial system. If that happens, why would you assume that your gold ETF or whatever would be safe?
Unless you (or someone, preferably overseas) physically hold the gold in a secure place, I just don’t see the attraction. There are better opportunities out there, IMHO.
I’m definitely no gold bug, but…Gold might not be bad to hold as part of a diversified portfolio, if only that given a severe economic shock it will likely be bid up speculatively. As long as you know when to get out and have someone to sell it to (and there is always a market internationally), it’s probably not the worst investment.
“As long as you know when to get out …”
And just how is someone to determine just when this “when” is?
When combotechie decides gold isn’t such a bad thing to have.
When to get out of gold? When it looks like the bestest investment, ever.
Lol. Then you should plan on keeping your stash for a very looong time.
I buy gold both physical (in very small amounts) and exchange traded (iShares GLD). I also buy exchange traded silver (and have an insignificant amount of physical “junk” silver, too, in the form of worn-out Mercury dimes, etc.)
I don’t think it’s an investment. Think of it as “shock absorbers” for your portfolio, and some protection against a sinking dollar.
My take: accumulate it slowly and steadily! Over years! Stop when Gold and Silver are about 10% of your portfolio.
Some other comments:
1. I avoid things like “gold mine stocks”, etc. Too much hanky-panky goes on with these.
2. The cheapest way to buy physical gold is Krugerrands. You can get them for about 5% over spot. Find a local dealer. I wouldn’t buy them unless your state has a sales tax exemption for “coins.” It’s not worth paying 8% extra to your state for them. Pay cash! Dealers don’t have to report cash purchases of less than $10K
3. Storage is a problem! I just have them distributed among three banks in three separate safe deposit boxes. Personally, I think it’s dangerous to have physical gold, and that’s why I have very little of it.
4. Keep track of the purchase price and date of each physical ounce you buy, so you can pay cap gains tax someday. (Or at least make the case that you intended to
)
5. Ask your lawyer/accountant about new laws regarding overseas accounts of more than $10,000 before deciding to store anything overseas.
My thinking is similar — I’m not all fired up about precious metals, gold or otherwise.
But the Gold Fans have assembled enough evidence to convince me that holding some of the physical stuff is indeed a good idea, especially in an inflationary environment. (My girlfriend and I already hold some gold, but only in the form of vintage jewelry and decorative pieces, not in its pure state.)
My main problem has been in deciding when the strike price is right.
“It seems to me that the only reason for holding gold right now is if you anticipate a collapse of the financial system.”
Point taken. Gold’s staunchest defenders on this blog seem to believe imminent collapse is a nearly-sure thing. I personally see scant evidence to support this view.
Let’s see we currently have:
- Credit market seizures
- Record debt
- Paulson saying ‘Nothing to see here folks, everything is A-OK.’
- American’s largest asset collapsing in value
- Dollar at record lows
- Commodities being revalued up.
I’m no goldbug but cripes sometimes you gotta ask yourself what will things look like if/when the US dollar totally falls apart.
From what I hear, if you do decide to buy gold, buy it with cash and far from your home state.
“I’m no goldbug but cripes sometimes you gotta ask yourself what will things look like if/when the US dollar totally falls apart.”
So tell me… why does the dollar have to fall apart *now*? With every foriegn central bank cutting rates/preparing to cut rates, currency inflation abroad and the resultant price escalation (abroad) will continue to reduce demand for everything….. all of it. Commodities nuts are in for a a shocker, including peak oil wackjobs, end of world gold loons, etc. The Fed doesn’t have to do anything more than what they’re doing which is nothing.
“Voting registration numbers may signal a movement away from the GOP that could affect local, state and national politics for several election cycles.”
Limbaughs… “Operation Chaos” …or… #112 on the Cheney-Shrub Legacy List: “Dickey Boy, how many No-Bid contracts did we… give away?”
Voter registration shifts from Republican:
http://www.upi.com/Top_News/2008/08/05/Voter_registration_shifts_from_Republican/UPI-65421217941647/
“Voter registration shifts from Republican”
sweet….
An increase in voter interest and registration has, in the modern day, always been a negative for the Republican party.
An uptick in registration dilutes The White Man Vote — high registration means more poor people, more people of color, more women — pretty much any other demographic, statistically speaking, is bad for the GOP. That’s why local and regional GOP operatives are often under scrutiny for “voter suppression” right before or after an election. They try to disguise such efforts as anti-voter fraud measures, but they are (almost always) tactics intended to keep legitimate voters from voting.
Did Mike Malloy ever tell you how much he HATES REPUBLICANS?
“…And this years winner of the China “Solzhenitsyn Award” goes to…please be patient…it’s hard to climb to the stage with that attached lead ball.”
Meanwhile, after the Olympics…it was “back to work” for most Chinese:
http://www.reuters.com/article/artsNews/idUSL31313220080805
Bakersfried,…for the sake of “sales” …they best not run out of oil, because “snake oil” is going to have x2 less “agents of destruction”
“…But Mohammadi told Carrillo she misunderstood the arrangement with Crisp, who never intended to pay the mortgage, the investigator said.
Mohammadi then sold the home to Leslie Sluga, Crisp’s mother-in-law, and gave Crisp, Cole & Associates a check for $517,795, Carrillo said.
Luke Martin of the Department of Real Estate testified that when he interviewed Crisp in 2005, the real estate salesman brought magazine articles that detailed his success — the private jet, the designer clothes, the fancy cars.
Kottcamp objected to the questioning, but the department’s attorney said after the hearing it was relevant.
“I want the judge to see exactly what kind of image (these) guys were creating, how costly it was,” said Michael Rich.
Wire tap, sales deal testimony emerge at Crisp & Cole hearing:
http://www.bakersfield.com/hourly_news/story/514722.html
In the other category of deflationary effects we should be seeing over the next ten years or so; or is this just a demographic concern?
With the boomer retirement their income should be dropping.
Additionally the remainder of workers will be much younger. Hence the wages for workers should also be lower.
That will probably be a double whammy for government spending. Manufacturing in the US should get an extra boost as older workers with more expensive health care get off the books.
Anyhow, I’m thinking we are near the bottom for manufacturing in the US. So, I might look for investments in that arena over the next couple of years.
Also predicting that our older generation will be adjusting their lifestyle expectations downward a bit. Should be a premium on workers as more and more people retire.
(I’m thinking we are near the bottom for manufacturing in the US.)
Manufacturing did quite well for about a decade through the late 1990s, so you may be right. But after so many lean years, no one has any skills in that field, so as skilled workers retire jobs may need to be outsourced due to labor shortage. You already see this problem in coal mining — 40 years of decline, all the miners over 60 and leaving in droves, no skilled workers.
And as we all know, it is impossible to actually train anyone to work in a manufacturing plant.
You can always train people. But having to train everyone from scratch, including people who have never used a screwdriver, is different than working the vocationally trained newbies in over time.
Equilibrium adjustment costs will be one price our resilient economy gets to pay for transitioning from a REIC-based economy to a productive economy.
I think it might be better to train up people that have never used a screwdriver, they have no bad habits to break and aren’t already members of a union.
Lufthansa only hires pilots with no flight experience.
Please tell me you mean, “pilot trainees”.
“But after so many lean years, no one has any skills in that field”
That and how many of the ‘better school districts” pride themselves on very low numbers of BOCES or vocational students. My electrician told me our district is in the single digits for vocationally trained students. We got to that story when he was telling me some horror stories about how unknowledgable his trainees are. He told me he’s talked to our school superintendant about it. Super said that’s never going to change in this town.
Let’s face it. America no longer values those skill sets.
I suppose they’ll soon be finding out how that attitude’s going to backfire.
In a hypothetical world with equal birth/death rates and stable productivity rates each individual is able to work and maintain their standard of living forever, from generation to generation.
Now an extra baby is born one year, for the next 18 years the productivity of society is unchanged but the demand has increase thus everyone in society has a lower standard of living.
Then the baby enters the work force, all of a sudden production exceeds needs and everyone enjoys a higher standard of living.
Then this baby retires and everyone’s standard of living falls until the boomer finally dies, at which point “equilibrium is restored”.
As long as society saves during the productive years of the boomers then the standard of living can be maintained at the “equilibrium” level from the time the boomer enters the workforce until they die.
If instead, this extra productivity is consumed due to inflationary schemes that make people “feel richer” and “government anti-trust funds”, then this leaves no choice but for the current generation of 20 somethings to bear the burden their parents like their grandparents did when they were born.
Basically, there will be wide-spread poverty among the boomers and a heavy burden on the workforce. The boomers will cry out for government help and they will get it (being the largest voting block). This will lead to printing of money.
Just wait until all of that “retirement” money starts poring out of stocks in into commodities consumed by boomers in retirement.
“…McCain is quoted on the page as saying to Cheney in 2001, ”With a little more luck, I might have been able to ask you to be my vice president.”
Now that’s funny!
Cheney press secretary Megan Mitchell:” Get someone over at the “Shadow Gov’t VP Offices…see if they can locate that “duck hunting” calender, we need to check the schedule…yes, the one with Daffy Ducks face being blasted while on vacation in Dubai”
Cheney’s role at GOP convention a question:
http://www.nytimes.com/aponline/washington/AP-Cheney-GOP-Convention.html?_r=1&oref=slogin
“I recognize that sound,” McCain said as dozens of bikers revved their engines as he walked on stage in a sustained growl of approval. “It’s the sound of freedom.”
And it’s being “throttled” all over…Saudi Arabia / Kuwait / Dubai
$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$…vrooommmmmmmmmmmm
The solution is simple: Drill for more Oil!
“…attempted to harness a powerful engine of heartland conservatism on Monday”
Wouldn’t that be: Caterpillar / John Deere?… I don’t think that those who ride Hardley Davidson’s tend to be “pro police” & “anti-drug” or has the “biker” image been transformed lately? What, you gonna tell me that the have tattoo’s of the GOP elephant next?
Someone, anyone, please tell me who works harder for their buck?
24,000/yr employee with a family or the 150,000/year employee with family?
150,000/yr employee with a family or the 1 million/yr employee with a family?
1million/yr employee with a family or the 50 million/yr employee with a family?
The person’s income based on wages or a person’s income based on interest/dividends/appreciation of assets?
Just someone who would like to know before I decide who is a hard working American and who is coasting through life.
Some work harder, some work smarter. Personally I don’t care who earns what as long as it doesn’t affect me.
You would if your ox was being gored!
You can’t tell who is hard-working by their income. We work our butts off, probably each of us do 70 hours/week (12 hours/day, 6 days/week). But most “liberals” would say we make too much money.
Nevermind the fact that we’re directly responsible for creating dozens of jobs. California is making it clear that they don’t want us here!
Reuven Avram,
Come on, isn’t 70 hours a week a slight stretch? I worked before entering college at at the age of 18 and I could only maintain that pace for about 3 months. If you are working that hard, you need to find another career, maybe one that makes 100 million a year!
Not to mean mean in my comments, but this ridiculous unless you are working in your sleep!
No! It’s about right! I don’t work on Saturdays, and work about 12 hours/day Sun-Thu and 10 hours on Friday.
Since I have ZERO COMMUTE it’s not that hard. Are you saying this is worse that the dumf*cks who bought houses in Tracy or Manteca and drive 4 hours/day to get to a job in Redwood City? They work 8 hours a day, but spend 12/day doing it!
last time I checked, driving to work is not work. People drive, believe it or not, on their vacations. By the way, it they consider driving work, then they need to bill their boss.
Sorry, for the smart allic remark.
I am in a bad mood today!!!
lol
“But most “liberals” would say we make too much money.”
Ok, this poster has just been outed. Move along folks nothing intelligent to see here.
and you can kiss my a*ss!!! How dare you throw mud at me? I am trying to sort out the truth from the b*ullsh*t from those posting on this website….
And I suspect you are one of those, if you want to suppress my opinion!
I have a novel idea, the one that has the most to lose, works harder to keep what he/she is getting than the person who will know that even if he takes a 90% hair cut, he/she will not be destitute.
just one person’s opinion from someone at the bottom, looking up!
Why does it matter who works harder? If you are trying to place some absolute or objective value to different jobs, there are other considerations.
Which job is more/less desirable? Sometimes this can be different among jobs that seem the same to an outsider. For example, different “IT” roles are different. Some IT jobs might require a lot of on-call time others not. So you could have two people that both work in, say, network security with vastly different job circumstances.
Which job is more difficult to be prepared for? An easy job may have taken a lot of time/effort/resources to become prepared for, like a higher education for example.
Which job requires harder to find attributes? The vast majority of people don’t have the genetic attributes required to play professional sports for example. This creates a natural shortage of people who can do that thing at that level.
And whether a person has a family or not has little to do with the job directly, that just effects how that person has chosen to spend their free time (e.g. driving the kids around or wiping butts or whatever). Although a person might pick a particular job b/c of family. For example, people who are working, let’s say in IT, but who also want to maintain familial/kid responsibilities (like picking the kids up to work) might find a job with a more flexible schedule, or no on-call requirements, or working from home, etc. These attributes are typically more desirable by most people and therefore one would expect the salary to trend down among those people, even though those people may have the same job title or similar other responsibilities while at work.
bluprint,
Sorry, but I think it makes a different when people are laid off and unemployment increases. If you are on the knife edge between barely surviving and between destitute and homeless!
I think it really matters.
Who is richer - Warren Buffet who’s 77 years old and probably has at most 10 to 15 more years to live, or an 18 year old kid in good health and the whole world at his feet?
amen, does it profit being the richest man in the graveyard?
az_owner,
while I agree with you as to who is richer, really our opinion doesn’t count when you look at the society as a whole. Our society believes that the richer person that person who is a 77 year old billionaire, otherwise would women be chasing after him as opposed the young healthily 18 year old.
Have you seen some of the MSM programs where individuals will do almost anything for money. Heck, some of those contestants would sell their mother for the opportunity to make millions. I suspect, sopm that they will be willing to sell their first born or their own organs. Welcome to unbridled capitalism.
I am not saying its right or fair, but”s that life in the 21 century of America.
Next: Buy a full price Starmucks…get a free room in Vegas!
Starbucks’ afternoon drink deal goes nationwide:
http://www.cnn.com/2008/US/08/05/starbucks.deal.ap/index.html
Still a ripoff if you would normally get an iced REGULAR coffee.
Silly me. Probably 90% of SBUX customers get the higher priced junk.
It gets better…the pencil head who came up with this idea… probably bought in March 2005.
“To get discount, customers must present receipt from their morning Starbucks visit”
Where the next taxes will come from-
Can you say professional services? I do not believe that professional taxes are collected on professional services-tax prep, legal, medical or dental, etc.
Something to look forward in the future, if I am correct.
How to fleece the public of their money. You steal 234 million from one person, if you can find him/her. or you charge the entire population $.01
One goes to jail and the second is not even prosecuted. Ah, the advantage of large numbers. In CA, they are talking about raising the sales tax by one % to solve our debt crisis. I suspect they will need other sources of income, however govt will start with the low hang fruit.
Raising sales tax is a horrible idea. It’s extremely regressive, and easy to beat. It will burden poor people much more than rich people.
While I don’t like soaking-the-Rich, I equally dislike soaking the poor!
I’m for raising the gas tax. High gasoline prices will curtail consumption (as we have seen) and encourage alternative methods of transportation. Throw in a tax on oil too.
I know my view is not popular (nothing new here) but there it is.
High oil prices in the Seventies got the country all fired up about energy independence. Low oil prices killed that idea. It also killed the economy of some oil producing states.
Combo, fuel tax should have been boosted years ago, say 2001…. We would not be in our current state if they were smart. But then again, since when were crony capitalists smart?
But … commuting from the exurbs in an SUV is my right, man — fossil fuels be damned.
An irony of oil prices lies in how the market views them. If the market thinks oil prices hikes are temporary then little action will be taken to find alternatives or consume less. This lack of action will act to prolong high prices.
But if the consensus of the market is high prices are here
to stay then long-term capital comes out of the woodwork and is committed to expanding production and developing alternatives. At the same time consumers make long-term energy-saving decisions (such as dump the SUV). This long-term thinking translates into lower market prices.
Sometimes it’s best to be a contrarian.
Damn straight ET. We PigPeople have our rights. We demand you little people subsidize our gross over consumption of fuel so we can keep on driving our PigMobilez, SLOBurbans and Tawhores.
See ya’ll at BurgerKing.
I’d like to do something about high oil consumption but sucker punching people that are locked into big cars isn’t the most viable plan.
I wanted to do something about this back in 93-95 before it became a crisis… but no no no. Not Billy Clinton. He couldn’t sweet talk enviromental legislation enough… then do absolutely nothing. Or better yet plans to do something in 2010 time frame. That is after he was long gone.
Billy boy had the senate and congress and lots of chances and said stuff it. Wanted that midwest vote.
Bush, you knew where he stood. People elected him anyway. An oilman.
The ship sailed on this long ago.
Those poor SLOBurban payment makers. Maybe you’ll be kind enough to make their payments too.
I don’t mind raising the gas tax. I drive less than 3000 miles/year.
well, it depends on how the gas tax is implemented.
my country has huge gas taxes (has been like that for at least the last 10 years or so). As a result, the price increase at the pump by the recent runup in oil prices was very small compared to what you were seeing in the US. Our price was around $10 last month, a few years ago it was around $8. So … people are used to high prices and don’t respond to change (boiling frog analogy?). There is some change to smaller/leaner cars, but up to now mostly for lease cars (business users). People who drive the big SUVs swear that they will not drive one mile less even if gas hits $25/gallon.
Compared to that the changes in driver behaviour I’m hearing about from the US are HUGE.
Apart from that, I agree that a high oil price has many benefits for the economy (at least the sane part of it that remains) and the environment (as long as governments don’t switch to stupid alternatives like nuclear).
Where the next taxes will come from…
In light of the probability of 4 or 5 years of low tax revenues, I’m gonna guess that you can kiss any inheritance/death tax shelters goodbye. As currently scheduled, 100% of inherited wealth will be sheltered in 2010, then it drops to only $1M in 2011, meaning about half of anything over that $1M goes to the govt.
Of course, Congress could repeal the law sooner if they want to.. could drop the protected amount to zero.. could do anything they like, actually.
So, now’s the time to get friendly with mom and dad (and hire a probate attorney for advice) because parents will have to transfer their wealth to the kids while they are still alive to prevent it’s seizure.
Question if anyone knows. Case/Shiller as part of their data used to put out a quarterly national price index - one that was separate from the Composite-20 and Composite-10 indexes, and I believe included all areas, not just key metropolitan areas. It appears that they stopped putting out this data at the end of 2007. Anyone know why?
There has been a lot of discussion recently, using Case/Shiller data as reference. In reality however the WaPo article from the other day was right on one thing - the overall home price declines are exaggerated somewhat by using only metropolitan areas, which for the most part have been more “bubbly” than rural areas. This bears out when you compare the Composite-10, Composite-20, and old national indexes - the Comp-10 showed a higher index peak (226.29) than the Comp-20 (206.52), which in turn also peaked higher than the national index (189.20).
Not trying to discount the downturn - just want to see if there is any true national averages out there, that don’t have the “conforming loan” limitations of the OFHEO data.
I’m not so sure Metro areas are any less bubbly, percentagewise, than rural areas. Of course, my data is anectdotal, but the few inlaws I have that live in the middle of nowhere are all greedy get-rich-quickers who are always looking for the next scam. They bid up sh*tboxes in Idaho and sold houses to each other just like the people in the big cities were doing. (And when they’re not trying to get-rich-quick, rural people get on SSDI for “back pain” and sell their Oxycontin to Rush Limbaugh for extra income…)
With a couple of exceptions - in general the larger metro areas have seen a bigger bubble than the more rural areas, at least per OFHEO data (379 areas in the U.S., including rural). I know the OFHEO is misleading some, though it’s still comparing apples to apples. So for instance here’s the top 10 and bottom 10 in terms of index gain (a good measure of how bubbly each area was):
1. Naples, FL
2. Salinas, CA
3. Miami, FL
4. Santa Barbara, CA
5. LA, CA
6. Santa Ana, CA
7. Riverside, CA
8. Ocean City, NJ
9. Ft. Lauderdale, FL
10. Oxnard, CA
…
370. Kennewich, WA
371. Fort Wayne, IN
372. Buffalo, NY
373. Florence, AL
374. McAllen, TX
375. Victoria, TX
376. Rochester, NY
377. Columbus, IN
378. Springfield, IL
379. Lafayette, IN
Out of the first 10 - five are within the Case/Shiller Composite-20 areas, and most of the other five are within a short commute of these areas. Out of the last 10 though none are in the Case/Shiller Composite-20 areas nor are within a short distance of them.
Breaking it down, by number of C/S metro areas in each range of bubbliness (most bubbly to least bubbly):
001-050: 009
051-100: 004
101-150: 003
151-200: 001
201-250: 000
251-300: 002
301-350: 001
351-379: 000
So it’s fair to say that the Case/Shiller metro composite indexes do indeed to have a tilt towards showing larger bubble than what actually occurred nationwide. This isn’t intentional I’m sure, it’s just that for the most part the larger metro areas were more bubbly. That’s why I’m wishing that Case/Shiller still published the national index, not just the index for major metro areas.
“With this technology we can also find out what the animals do all day.”
O.K., I can almost breathe now…
These guys obviously have never seen Wallace & Grommit’s: “A Close Shave”
Herding cattle goes high-tech
http://www.cnn.com/2008/TECH/08/05/remote.herding.ap/index.html
You just got to love Reps.
They say that free enterprise/capitalism will set the world (or at least the US) free and then they go an elect the biggest socialist/central planning administration since FDR. Unfortunately, FDR was attempting (though some say not successfully) to help J6P while GWB was helping the poor down-drowned owner class elites.
So who did the public re-elect for a second term after the non-free enterprise actions of the first term? You guess it, GWB. If those out there do not think that marketing/advertising is a crock, then please explain why GWB was reelected based on his first 4 years in office and the stagnant wages and increased debt incurred by the public?
And to top it off, the Reps, fall back on the same argument about they are for unrestrained capitalism/free markets.
Now I would like to add a disclaimer that I am not a dem, but an independent. I believe that what’s being offered by the Dems are just as bad. What this country needs is a third choice, whatever that may be.
My personal humble opinion.
i just cannot belive the notion that the housing bubble would not have occurred if gore or kerry had been elected to office.
I’m still hoping Ron Paul runs as an Indy. I also hope he picks Kucinich as his running mate.
A big fat Eff-U to the corporate cronies and puppets.
sleepless_near_seattle,
If the economy is going to be as bad as non-MSM sources expect it will be, you will get your wish in 2012, if open rebellion does not occur before then.
My personal choice is R. Nader, though I would accept almost anyone but a dem or a rep.
You’ve got it bassactwards…it’s Cheney-Shrub…really…look:
“…Suskind reports that Bush initially told Cheney he had to “‘step back’ in large meetings when they were together, like those at the NSC [National Security Council], because people were addressing and deferring to Cheney. Cheney said he understood, that he’d mostly just take notes at the big tables and then he and Bush would meet privately, frequently, to discuss options and action.”
–Suskind contends Cheney established “deniability” for Bush as part of the vice president’s “complex strategies, developed over decades, for how to protect a president.”
“After the searing experience of being in the Nixon White House, Cheney developed a view that the failure of Watergate was not the break-in, or even the cover-up, but the way the president had, in essence, been over-briefed. There were certain things a president shouldn’t know – things that could be illegal, disruptive to key foreign relationships, or humiliating to the executive.”
http://news.yahoo.com/s/politico/20080805/pl_politico/12308
“……..things that could be illegal, disruptive to key foreign relationships, or humiliating to the executive”
Shirley you dont mean to imply:
…stuff like blowjobs in the “oral office”
and
*** rimshot ****
I’ll be here all week, dont forget to tip the host..
hat tip ben.
Ha,… me thinks you thinks Clinton boy = “good boy”… not good boy…liar, swindler, deceit…Cheney… different adjectives… different “level” of dere-lic-tion of duty, but then “come” to think of it…some folks are attracted to that type of “personality”
i likes you old timer..
you actually remind me of Mrs. Voz’s Boomer age hippie friend patron of arts’, retired Father…
classic….stuff.
me no thinks clinton=good boy.
methinks…….?
its all relative.
This bit from the WSJ touches on one of my biggest pet peeves: realtors and developers trying to portray exurbs in the American south as the equivalent of Tuscany. In northwest Arkansas, no less. LMFAO!
________________________
“Now, many of the region’s new subdivisions, with houses that can’t be rented, much less sold, are forlorn monuments to disastrous real-estate forecasting. A subdivision called Tuscany, five miles west of Bentonville, was envisioned as an enclave of luxury homes with landscaping meant to evoke an old-world Italian village. Developers installed an enormous hand-built stone wall surrounding several hundred acres of what had been cow pasture. So far, only five houses have been built, and just two sold.
Carol Trees, who paid $570,000 for a 4,800-square-foot house six months ago, admits the solitude is a bit disconcerting. The good news is that her three children have the run of a pasture longer than several football fields. ‘We love it right now,’ says Mrs. Trees, a nurse practitioner. ‘We sit on our back porch and fantasize that we own all this land.’
Do you have a link?
NW Ark got it bad. One of my wife’s high school friends lives up there with her developer-husband. I recall a few years ago (I think we were at a wedding shower of some sort or something…it was a couples thing) her bragging about how they have several houses under construction and the house they live in is huge, etc. The girl is easy on the eyes, but she needs to keep her mouth shut.
My wife and I were still living in our first house at the time (which we just sold in March) which is a small 1100 sq ft job. It was new when we bought, but not fancy at all (I did put tile throughout a few years after we bought it though). Anyway, I have to admit the competitive part of me was a bit envious. But I couldn’t figure out how these people were making all that money and no way we were about to sign up for that kind of mortgage.
Since then, they are still sitting on three houses, probably all of them huge. My wife got an email from her the other day. While telling her what has been “going on” and how we sold our house and to where we moved, she made a point to say that “it’s good to be liquid right now.”
I smiled. My wife has really been “getting it” lately.
http://tinyurl.com/5kahsa
http://blog.lucidrealty.com/2008/04/25/the-truth-about-chicago-area-housing-prices/
Some REtards in Chicago seem to get it right.
A question for the gold bugs: How can one value gold, meaning how can one determine what the price of gold should be?
If the question was about real estate then factors such as incomes and rents could be used. If stocks were to be valued then P/E, yield, ROI, book value, etc. would come into play.
So, how does one value gold? A fair question, no?
If I believed you asked in an honest attempt to learn something, I would answer. But you are just baiting.
value it as a fire insurance, maybe?
But if is valued as an insurance, such as fire insurance, how could you determine what value to place on it.
The value of fire insurance, thus its price, can be determined by the value of the property that’s being insured.
if you convert your money into gold you give up the little bit of interest that the bank pays you for gambling with your money. That is the price you pay for the security of gold in the war against savers.
It’s difficult to get a burning home insured, better get some kind of insurance before houses start catching fire all over the place …
Some people value it according to its historical purchasing power. This makes sense if you consider it protection against a devaluing currency rather than an investment.
E.g. how much gold did it take to purchase a basket of goods some period in the past compared to now. The basket could include consumables or commodities or even stocks.
This valuation model might also make sense if you are valuing it for speculative (either to buy or short sell) reasons.
i am not for or against gold but i think your argument is the same as my daughters, she asked me how would a store clerk know how much change (in gold) to give me back if i handed them gold to pay for my purchases? most those idiots cant even figure out the change in dollars and cents, would it be done by scales?
The only way to value something is to know one of two things:
1) How much you want/need it compared to what you have to exchange for it. This is a personal choice.
2) How much you estimate that others are willing to exchange for it.
So, when you are in the market for something that you have no personal desire for, you have to predict the behavior of your fellow man. Buying and selling for a profit is almost always speculation about what others will want/need in the future.
In a world with failing banks and inflating currency the demand for dollars will go down because they become a liability!
I know that a starving man would trade an oz of gold for a loaf of bread if a loaf of bread was the best deal he could get for his gold.
The only reason for someone to hold gold is for long-term savings and only those with significant wealth will be concerned with long-term savings in a world living paycheck to paycheck. Gold is too dense a form of wealth to be used as coined money without some sort of “paper” system backed by the gold.
If you are looking for an alternative currency then look to silver. This is what the average man can reasonably be able to save in and trade with.
So, when you value gold, value it against everything else you could have instead of the gold. Then determine what everyone else would want to trade their gold/silver/blood for and buy that.
Remember that when we were on the “gold standard” that the rich never simply “stored” it any more than they “store” federal reserve notes today. They would use their surplus gold to invest. At the very least they lent it to the bank for interest. I think it would be wise have a small amount of “emergency” money in silver, and to focus on what people need or *will need* once the schumer hits the fan.
For me the value of gold/silver is having something tangible and tradable in the event of a hyperinflation.
“The only way to value something is to know one of two things:
1) How much you want/need it compared to what you have to exchange for it. This is a personal choice.
2) How much you estimate what others are willing to exchange for it.”
Well, this is certainly limiting. How about connecting the value of something with the amount of free cash flow it will generate?
Or the amount of money one would save by having it as compared to not having it?
and only those with significant wealth will be concerned with long-term savings
I don’t have any examples to share, but I know I have read about cases of people who live in third world countries making a dollar a day who are still able to save.
Just saying that people do adapt and in some respect live their lives like normal no matter the absolute conditions. I could imagine a scenario where goings are tough (scraping by), but we still have food to eat (but are far from wealthy) and we just don’t touch the little box of cash/metal/whatever buried under the old oak tree.
Is that the oak by the mailbox, or the one by the well?
Can any lawyers remind me again the difference between “will” and “shall” in contracts and the law.
“it depends on the meaning of is, is.”
Wm. J. Clinton, 42nd President of the US.
I’m a lawyer, but the difference isn’t legal. My recolection of 8th grade English grammar unit is that “will” is for 2nd and 3rd person. “Shall” is for 1st person.
So…”I shall” and “we shall” but “you will” and “he will” and “they will.”
In a legal document, using shall is probably just old-fashioned or pretentious.
I smell a rate cut coming soon.
If there was a rate cut today the DOW would go up 600? I am amazed that keeping rates steady produces a 300 point upswing. Bear trap?
Bull trap. The Fed won’t raise and everyone knows it. Da boyz want a rate cut and the current argument is ‘Inflation is moderating, the Fed is on watch…so you can cut rates again.’ As if rate cuts have helped the market over the past year.
I love the smell of fresh powder in the morning…
watch the VIX lower, watch volume lower….full meltup.
SKF goes under the 100 dollar mendoza line.
May I say something that I have wanted to say for the last year reviewing and occasionally commenting on this website.
First, I came from a poor family. Second, my father a WWII vet was earning approx. $3,000/yr from the Navy in 1960. I know because I saw the student loan applications from my Mother (who, by the way, at the age of 28 with no high school degree, graduated from USC in the late 1960’s with a major in English and a minor in French as “Summa Cum Laude”. She went on to get a masters degree in Education).
Anyone under the age of 50, do not know how difficult it was for divorced or married women to survive outside of the welfare system (thank you LBJ and the war on poverty). Women in CA, without family money connections could not hold separate title to property or given credit. Heck Husbands of a family could only get Sears credit cards.
I guess that what I am saying is that if you are late boomers or later generations, you have no concept of the way the world was or how it has changed.
In the late 60s, they had records and not Ipods, CSs or tape drives. No one but business people had credit cards (other than Sears, in my case) and money that was loan was based on the 3-6-3 rule (invest at 3%, loan out at 6% and on the golf course by 3 pm.)
Young people, whatever their political or economic persuasion, are in no position to criticize the actions of those older than themselves. The situation that you see today did not exist in the recent past.
RANT OFF/
ps: The weapon used against baby boomers to not to over turn the apple cart of the power games of the elites of the US. was nuclear war. In spite of that, we still had our own social revolution? What is holding you back from making a difference? Have you come up with solutions instead of complaining about bad decisions made by fellow citizens? I believe that the children of their parents and grandparents, who have sacrificed for their grandchildren were wasting their time and effort. History is a funny thing, if it didn’t happen within your lifetime, it didn’t exist. All well, so much for age, memory and experience.
RANT OFF/
Young people, whatever their political or economic persuasion, are in no position to criticize the actions of those older than themselves.
Riiiiiiiight.
Critical thought and dissension have no place in a democracy — especially if it comes from someone younger than you.
That’s very Richard Cheney of you.
Get over your self righteousness, pleassssssssssssssssssse.
The point I was making is that all young people think that the way things are currently is the way they were in the past and extrapolate backwards in time. This is not the way to make ethical and moral judgements from individuals who lived in a different time.
With regard to the speed of change in the world, my grandma was born in the late 1800’s. Within her life time the world went from covered wagons to landing on the moon. That is a rate of change that is unknown in human society as far back as historical records go.
So what do you think of that!!!
As soon as I see a comment where the generalizing term “all”…(race, gender, age, etc) is used , I know to ignore the comment.
Glad to see the open-mindedness of the 60s isn’t dead
Yeesh.
I apologize, however in the 7th grade, my teacher in 1963 showed us “the triumphant of the Will”, produced before the beginning of WWII. Now I may have been the only stupid person in the class, however, gee, it was like 18 years ago, prior to my birth, however this event might have occurred 2000 years ago for all the relevance I felt in my life.
As a child, you are not interested in the past, when your future is ahead of you. Think about it, 13 years old, and you still do not know what the heck is going on in the world. You have yet to reach puberty! You may or may not have your parents and and your bothers/sisters figured out, however you are now facing an unusual future in the world away from home.
All I am trying to state is that between generations their is a hugh gap in experience and knowledge of how the system works to survive and take your position as a productive member.
Heck, I am not blaming my younger peers for how they think! ( I and your parents were there before you) Unfortunately that is just the way life works. My only concerned that those who pull the strings to manipulate public know this and its use against the public. Remember the rule of the powerful, “divide and conquer!
There was nothing self-righteous about my remark.
Yours, however, was ill-conceived.
Your following comment does little to clarify matters.
The point I was making is that all young people think that the way things are currently is the way they were in the past and extrapolate backwards in time.
Really? All young people think contemporary societal norms are static — and they make wild extrapolations based on these unmoored, fantastical notions of history? All of them? And then — they reach a certain age and the erroneous extrapolations … stop?
Golly, how did civilization make it this far?
We are lucky to be old, indeed.
And then — they reach a certain age and the erroneous extrapolations … stop?
Yes. Anyone younger than me does things wrong and has it easier than I did.
A similar rule states: “anyone who makes more than I do is rich”
See the similarity?
“Never trust anyone over the age of 30″
Some “Gen-Xer” coined that phrase just last year.
Oh wait a minute…
Fun trivia fact: 20% of Fannie Mae’s repo inventory is in Michigan.
Trivia question: What percentage of Fannie’s exposure is in Michigan?
Trivia question: What percentage of Fannie’s exposure is in LA?
if we get much more Fanny exposure, we may have to censor the blog.
I’ll take AMD for 4.50, Alex. I love playing Jeopardy!
jeez hoz, I yank your chain a couple times, and I cant even get a pithy snark….I know ya got something to say, ya crafty old codger.
I’ll bite, 1% exposure in MI. 20% in LA.
“…China Development Bank is competing with Commerzbank AG to buy Allianz SE’s Dresdner Bank, Germany’s third-largest lender by assets, three people familiar with the matter said.
China Development Bank, which funds the nation’s public works projects, has conducted due diligence on Dresdner Bank in Frankfurt, said the people, who declined to be identified because they aren’t permitted to publicly discuss the matter. The 23.3 billion euros ($36.6 billion) AllianzOpen in a new window paid for Dresdner Bank in 2001 is more than six times the biggest overseas acquisition by a Chinese company. …”
Bloomberg
Probably won’t happen, but China is looking for stable places to buy. The US does not appear to be a beneficiary of China’s aims. Burned t’many times with losses to show.
CNN’s Breaking News line:
“Dow rises to its highest levels of the day - briefly climbing above 300 points - after Fed talks tough about inflation.”
So, let’s recap:
Lower rates = market rise
Talk tough about inflation (possibility to raise rates) = market rise
I’m not ashamed to say I have no idea what these gamblers are thinking. All of this forward looking, reverse contrarian thinking makes my head spin.
Tough talk on inflation + no action = punchbowl respiking time
Don’t try to rationalize it, just ride the wave.
Bought SSO last week for $58.15 and sold at the end of the day for $61.52. That’s a nice little 5.8% rise in just a week. Market could go up a bit more on Wednesday, but it seems like another sharp pullback this week is most likely…
Ben, please cut me off from this website. I can not take it any more. Some of your posters make me feel like i an in the Ann Rand society located in the “Twilite Zone”.
I am addicted, please cut me off.
Thanks, I feel better already!
When you no longer feel addicted to this web site, that will be a good sign the housing market recovery is underway.
This is a very good prediction.
Thank for your unprofessional opinion, Mr. PB.
Lostcontrol, ey feeel yr pain. Two college-educated twenty-somethings in my apartment building told me the other day that reading was the old fashioned way to learn about stuff, and that the modern way was to watch videos on the internet.
They described themselves as progressive, liberal, tolerant, etc.
If they hadn’t been raised in a multi-cultural society where women had equal rights, would they still be in favor of racial and gender equality? It’s easy being “progressive” when someone else made the progress. Most of the so called bigots of old were simply conforming to their society, and many of the so called enlightened young people of today are simply conforming to their society. Human conformity is not courage, it’s cowardice, and nothing to brag about, regardless of the outcome.
You picked an apt userid, I’ll say that.
I do not normally make projections about the future, however I would like to make an exception at this time-
The present does not alway/ever replicate past circumstances, however my advise is the following:
Get in touch with your parents/grandparent on your next holiday, and probe as to what their life was like when they were young with specific reference to recessions/depressions.
They will tell you their experience as to what they went through which may assist you in whithering our current economic situation.
Just a word to the wise, If the world isn’t going to He11 in a hand basket, they will appreciate your interest….
Gold’s close below the 200-day moving average of $889.27 will trigger more sales, analysts said.
“If gold closes weakly today, we will throw the towel in on our strong one-month and three-month views tomorrow,” said John Reade, a UBS AG metals strategist in London. UBS forecast last month the metal would reach $1,000 in one month and $1,050 in three months.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aZb5f2D_svTI
does this mean there will be a huge sell off tomarrow?
“Gold’s close below the 200-day moving average of $889.27 will trigger more sales, analysts said.”
This doesn’t make much sense if you think about it. Why would one sell something he wants to own if the price goes down? This is when he should buy, not sell. Does this mean he should buy if the price goes up?
All just statements by talking heads to try to justify their salaries. Meaningless - ignore them.
There may be a few automatic sales orders that will be triggered if the price drops below 200-day MA, but there are just as likely if not moreso orders to buy if it drops below. In the end - both are vastly outweighed by other market pressures - namely the demand for commodities; in the case of gold the perceived risk in other markets, combined with the perceived expectations of future inflation, drive the price primarily.
Ben, It does not appear that you cut me off as I requested, so here goes…
Which people are critical to the survival of the human species, The banker(concerned only about making a profit) or the humanitarian? One makes millions of dollars in income and the other makes marginal wages.
Who gets hurt with layoffs, the banker or the humanitarian?
If you can ont figure it out, its the latter.
Welcome to the new world of diminishing expectations.
Who has a greater chance of survival, the person living on the knife edge or the banker.
My guess is the person living on the edge. They have learned how to work the system and can survive. The banker has assets, but what does he do when they run out. No experience. He is dead meat.
The only question is whether this will affect the lower and middle class or with this economy effect the upper class/elites. If the damange is extensive, the elites are toast! No survival skills!
Oh good gravy.
Look, bankers tend to perform an esential function in a capitalist system. They distribute capital. Esential resource in the economy.
Otherwise its a bartering system.
Now, our siutation is way out of balance with debt; be it personal, government or corporate. So, the bankers have made mischief and the debt is causing decreased economic activity, wealth concentration exc. Some of it the fault of Department of Central Planning aka the Fed… some Bush… a lot to congress and senate.
If we have a complete collapse; survival will be based on other skill sets. Not sure how it would work out. Would farmers do well? History says they do sort of OK but agricultural states have always been crushed by manufacturing states, maruding barbarians exc. In the more immediate term I think its all about location location location… people in remote areas with decent water/power supplies would do better.
Humanitarians are attracted to poverty and will be eaten as food. Serves em right, eh sort of.
In a complete breakdown LA would be toast as people trapped near the desert with few resources with hostile race relations become battle lines.
Not sure what would happen in the midwest/East coast sprawl? Could be a substantial amount of crime as oil disapears and power is not available… again I’d guess that water supplies would be the biggest concern.
How many people have any survival skills? I can reload my own ammo and hunt/fish/farm but I’m in La La land. I’ll be eaten before I can get out.
Hell. It would be a mess lost. Who knows?
I have a question I would like of the posters?
Have you seen social collapse of a society. I have, twice in my lifetime-
Vietnam in 1969-70 where might made right.
Berkeley, CA where the public of the city marched through the streets and so overwhelm the police(including the Alameda County Sherriffs department that no one interceded in the protest. The police fell back to the roof tops of the local building. I saw police cars careening out of control down the main streets around the university. It is scary to see the police, the protector of law and order, totally out of control..
So, anyway that is my experience…take with it what you will…
Ease up just a bit El-C.
you starting to scare the children.
lostcontrol,
your profile clearly indicates that you are a vietnam veteran, on full disability for PTSD, and mostly live in the virtual world of tv, movies, news, and intertubes, empty nest, college degree, probably divorced….likes to drink….but I digress.
here’s the deal pops. The world aint gonna come to an end, and if it does, WTF? We had a helluva run.
At least you care that family love and respect is important.
and no, Ive never actually witnessed social collapse. I watched a riot on TV once though. And recently, I have seen pictures and video of bank runs….its quite a show…the panic.
I have, however, positioned myself in such a way that when the occasions people figure out, just WTF is money….they can come and get it from me.
some people never learned that actual money is a form of fiat, PM’s, stocks, bonds, commodities, contracts, chattel paper, inventory, “real” assets….you know, money.
and without it….thats survival skills.
amassing moneys with modern day survival skills….think about it. thats why people even come here.
anybody ever come here to learn about urban-jungle survival skills? Methinks thats a whole different website.
Oh, just cause some wussy police force in Alameda ran away isn’t much to worry bout.
Now those guys in Ohio really know how to put down a protest.
That was dark humor and no I wasn’t serious.
A Year in a Tin Hat: The Credit Crunch, Crunched
Aug 5 2008 1:18PM EDT
Greenspan to Bernanke: You’re Becoming Irrelevant
You have to wonder if the former Fed Chair has any personal warmth for his successor. Judging by Greenspan’s column in today’s Financial Times, the answer would be no.
Although Greenspan’s ability to move markets has waned in recent months, he’s still a news maker. So why is he trying to capture some of the attention on Fed decision day by allowing the FT to run his op-ed?
World to Alan Greenspan: you’re irrelevant.
Now go get your nurse to change your Depends before Andrea gets home.
I still have a hard time …her tongue in his ear… did I hit enter…
Well, It seems that I have caused some thought unprovocative thoughts among your posters. I am sorry that I caused you lost of bandwidth, however this website was beginning to be so “Ann Rand” and all her BS, that someone needed to shake it up.
I apologize for all the commotion that I may have caused, however, your posters stopped thinking and got locked into single set mentality. Really, the people in this world are no all necessarily bad. I, in the bottom of my heart, believe that are searching for opportunities to get ahead in a system they did not create. A lot made the wrong decision based on listening to the wrong people that they relied upon. Now they and the rest of us will have to pay the price…
Life is not fair, and no one (except the con artists) ever said that it was. Everyone should do the best they can to help the helpless (that includes children, and cats and dogs).
Wish you all the best to a great conversation.
Lostcontrol,
You make some very good points, and I agree that we have moved away from what makes a country (and economy) great, working together to build a better society where more people live happier, healthier and better lives.
We most definitely have a problem with valuing capital more than labor, and I hope that this debacle will wake the sheeple up to this fact. We need better leaders, and we need to ensure that **we the people** have the power to elect those leaders.
I am sorry that you’re having a bad day. Hopefully tomorrow will be better!
Take care and just take one day at a time.
Sorry, I had to add this to the discussion:For PB
Lead (pronounced /ˈlɛd/) is a main group element with a symbol Pb (Latin: plumbum). Lead has the atomic number 82. Lead is a soft, malleable poor metal, also considered to be one of the heavy metals. Lead has a bluish white color when freshly cut, but tarnishes to a dull grayish color when it is exposed to air and is a shiny chrome silver when melted into a liquid. Lead is used in building construction, lead-acid batteries, bullets and shot, weights, and is part of solder, pewter, and fusible alloys. Lead has the highest atomic number of all stable elements, although the next element, bismuth, has a half-life so long (longer than the estimated age of the universe) it can be considered stable. Like mercury, another heavy metal, lead is a potent neurotoxin that accumulates in soft tissues and bone over time.
I pass the ball to you…Give it your best shot!!!
Ben, I second LC’s request for banishment. I think he may be off his meds and therefore should be exiled for his own protection.
dude, thats very un-dude.
El-Sea is not bad, in fact its good to get that type of shit off your chest…..even for just a momment…
keep it coming…
the viceral is why I read this blog all day long…..better’n a shrink.
VirginiaTechDan had a helluva post on gold, money and exchange……
its why I come here….
I was just trying to help a brother out. He’s the one that requested banishment.
I agree wholeheartedly with the thought that the blog is therapeutic. The denizens of the matrix can be very frustrating at times.
Yes, Those groupies which included Alan Granspan who followed Ayn Rand were some interesting characters.
Rent the movie about Ayn Rand. It is listed as Ayn Rand. Easy to find.
[edit] The Fountainhead
Main article: The Fountainhead
Rand’s first major professional success came with her best-selling novel The Fountainhead (1943), which she wrote over a period of seven years. Its plot centered on a young architect named Howard Roark and revolved around the conflict between independent thinkers and “second-handers.” The novel was rejected by twelve publishers before finally being accepted by the Bobbs-Merrill Company publishing house, upon the insistence of editorial board member Archibald Ogden.[17]
The Fountainhead eventually became a worldwide success, bringing Rand fame and financial security. In the sixty years since it was published, it has sold six million copies, and continues to sell about 100,000 copies per year.[17]
In 1949 Rand’s novel was made into a major motion picture by Warner Brothers with Gary Cooper and Patricia Neal; Rand wrote the screenplay. Following the success of The Fountainhead, she wrote screenplays for two other movies, Love Letters and You Came Along.
So homebuilders’ stocks just shot skyward - anyone know why?