The Housing Bubble

I think they want/plan to do both.

free “reign” lol. That’s about right.

You’re right, the GOP would never take our money and spend it on cr** (I assume this isn’t code for “crow”).

ET, I don’t think he was claiming that the repubs wouldn’t try to take our money and spend it on different crap…simply that having things discussed due to neither party having a super majority (or both congress and president) is preferential to legislation simply being pushed through hastily.

drummin, that is exactly what I meant. I am a relatively conservative guy but am very unhappy with GB and his buddies power grab over the last 6+ years. I don’t trust EITHER party, especially with out any checks or balances whatsoever.

I don’t trust EITHER party, especially with out any checks or balances whatsoever.

I agree — the system works better with those checks in place.

Those checks and balances really took a drubbing over the past eight years, and there’s plenty of blame to be cast on both parties and all three branches of government for not using them properly. But the prime remover of those checks and balances was the current administration, whether by coercion, end-around maneuvers, appointments or by simply flouting the law.

We are now entering the You Reap What You Sow phase of that process, however, where the short-term opportunists get bit on the arse.

I am thinking after eight years with GWB in office, the stock of golden-egg-laying geese which fuel our economy is weary, unhealthy and dwindling in number. I have every reason to fear that expedient measures set forward by well-meaning Dems to help us survive the economic storm may have the unintended consequence of driving the remaining stock of golden-egg-laying geese to the brink of extinction. Their approach to economic policy just has a natural way of accomplishing this sort of mistake.

PB - I agree 100%.

On checks and balances, I agree with the others above. We need more parties sharing power in Congress, not less. 2 is dangerously slim as it is.

I have to agree to a point. If we have all Republicans running the country is it clear the result. See today’s crisis for more info. The Dems could do the same thing, but I think they will naturally govern from the center, like they usually do.

Of course, if you think Affordable Health Care is “liberal” then we have a problem. Health care is a MORAL issue.

In any case, Republicans had their chance. They had the power and abused it. Don’t blame the clean up crew for the mess Republicans made. And in case you haven’t noticed, the American people have decided OVERWHELMINGLY that Republicans are to blame for this mess.

Now, can we all just get along?

What? Americans paying for their goodies with their own money? If we’ve learned one thing from the Republicans it that deficits don’t matter! Borrow and spend and let the good times roll!

“What? Americans paying for their goodies with their own money? If we’ve learned one thing from the Republicans it that deficits don’t matter! Borrow and spend and let the good times roll!”

So the dems never really had a problem with the deficits after all, and we’re in for even bigger deficits than the reps gave us?

Change you can believe in.

“So the dems never really had a problem with the deficits after all, and we’re in for even bigger deficits than the reps gave us?

Change you can believe in.”

Sure, if you want to consider so much as a dollar increase to the current deficit as “even bigger deficits”. But, I’d argue that the deficit spending that’s taken place under the current administration on such things as the war, might dwarf the next administration. By simply pulling our troops out, an enormous financial burden will be lifted.

You can’t eat golden eggs, you know.

“…can’t eat golden eggs…”

That wouldn’t stop me from trading them for green paper rectangles, then quickly trading those for food before their value summarily drops to zero.

Yeah, sorry about that. I just saw a metaphor that was ripe for abuse and couldn’t help myself.

My “hope” is for a president that will talk to me like I am an adult capable of critical thinking. Something that Reps last provided with Bush Sr. and hopefully will get back to in 2012, but we’ll see.

Adam,

Considering the white trash wackjob from wasilla didn’t know who the NAFTA trading partners are and “had no idea” africa was continent, I would hold out any hope for the gop to come up with anybody more intellectual than your average community college grad.

Let’s hope that except for an ocassional SNL skit Sarah Palin is history. She’s still pretty hot, but I want my VP to be a lot smarter than I am. That’s not all that hard to do, but she failed

I hope that the people hired for the top spots at the EPA will believe in enforcing the environmental protection laws that are on the books. I hope that the incoming head of the civil rights division of the Justice Department will believe in enforcing the the civil rights laws of our country. I hope the people hired for the top spots at the FDA will believe that the food supply needs to be protected against contamination. I hope that nominees to the Supreme Court during the next 4 years will believe that the Constitution is a living document and that pretending you can reliably predict what the drafters would do in a given situation is a fantasy that requires a doctor’s care.

You know, stuff that is actually under the control of the executive branch.

From the song “Fishing for Religion” by Arrested Development:

The word HOPE and the word CHANGE are directly opposite not the same…

BTW, I thought the Obama campaign was Change, not Hope?

Good post, Polly.

Personally, when I hear the constitution and living document mentioned in the same sentence it makes my skin crawl.

Mike

Well said, Polly. I “hope” I settle down with a smart woman like you, someday.

HBB match making? lol

Personally, when I hear the constitution and living document mentioned in the same sentence it makes my skin crawl.

Same here, it’s not a living document. It can be changed, but that requires some significant effort, not really the definition of a living document.

The only thing worse is when people refer to the Bible as a living document, that thing hasn’t changed in hundreds of years.

pretending you can reliably predict what the drafters would do in a given situation is a fantasy that requires a doctor’s care.

You don’t have to predict anything, only follow the law and not make it up based on what feels good right now. If the law is bad, then it can be changed, no reason to create new law at the judicial level.

How ’bout scaling back on the Palin comments a bit, Exeter. It’s rude and unbecoming to pick on women.

I didn’t hear anybody laughing at Obama for discovering another 7 (or was it States:
http://www.youtube.com/watch?v=EpGH02DtIws

I’m assuming that he was tired or distracted and that he actually knows that we only have 50, so I’ll (unlike you with Palin) cut him some slack.

I

Word.

The constitution is not a living document — it’s something that has been crafted and written down. You can not pick-and-choose which parts you wish to follow and those which you do not. If you do not like what the Constitution says, then change it, but don’t ignore it and brush it aside.

Frank, yes, I admit it, I’m a lib. But I’d like to see some fiscal discipline in the form of NOT keeping people in their homes.

Perhaps, some law that says: if you walk from your home, you can still get a mortgage despite the black mark on the FICO, provided that you fit the 2.5x income and have 2% down. Yeah, you live in a smaller home, but you have an extra $400-500 in your pocket each month to spend. See, gov just stimulated the economy without paying a penny.

And if you HELOC’d, you’re toast. (with exceptions for medical etc.)

Banks will eat it, but I’m not shedding any tears.

“2.5x income and have 2% down”

That would very quickly restore affordability in the housing market — especially the 2.5 times income part…

“I honestly don’t think he has done a terrible job given what he inherited.”

I just can’t believe anybody would make this statement. Either BB is a liar, an incompetent or an incompetent liar. I choose the last choice. The fact that you would find anything positive in his performance makes me afraid for this country. Truly amazing.

What should he have done? Raise rates, let the system fail? Bailout everyone. Bailout nobody? Sit back and just watch? Was Greenspan lying and stupid also? Honestly, let me know what he should have done, and what was actually within his power to do. I don’t love what he did and downright hate somethings he did, but please tell me what he should have done (and don’t use 20/20 hindsight).

RE: Either BB is a liar, an incompetent or an incompetent liar.

The disparate crowd who makes up this blog has called the shots with way more accuracy than this clown.

He should resign and drift off into the sunset with Opus.

“but please tell me what he should have done”

He could have started with a little f—ing honesty.

“He could have started with a little f—ing honesty.”

I believe the political pressure to paint lipstick on the recession pig may have overwhelmed him. In the end, all efforts to hide the recession failed, and the Wall Street investment banking sector collapsed into rubble just in time for Election Day.

Oops!

BTW, I expect the policy of using misleading econoganda to flummox the sheeple into making foolish decisions to continue unabated under BOwan.

You want to know what he should have done? Got on a computer and read this blog. Or the one by Russ Winter. Or read Roubini’s articles. At least not lied to the Congress that the “Fed didn’t think the US economy was going into a recession”. Had he clamped down on the excesses (neg-am, alt-a, stated income etc) around the start of his term (Feb 2006), the fallout would have been considerably less.

“…the fallout would have been considerably less.”

I don’t buy it. The fallout was going to be tremendous one way or the other, and the choice was whether to face the fallout sooner and get it quickly behind us, or to defer and spread out the fallout at the possible gain of less intense pain and loss of more protracted period of suffering. The former choice (faster harder landing) would have also made it close to inevitable that the D-rats would regain the White House.

“Had he clamped down on the excesses (neg-am, alt-a, stated income etc) around the start of his term (Feb 2006), the fallout would have been considerably less.”

Had he clamped down on the excesses in Feb2006, he would have been blamed for CAUSING the situation that he inherited. Even though he didn’t.

I blame Greenspan far more.

While I hate some of what BB has done, he has largely followed the playbook offered by historical analysis of previous panics. I actually think it’s a decent job, although no amount of the right playbook will actually stop this thing once it is rolling.

“Philip W. Coon sat down Wednesday in federal court, adjusted his tie, put on his glasses, took a hit of breath spray and was ready to begin serving time. Coon, the former executive vice president at Coast Bank in Bradenton, wanted to plead guilty to conspiracy to commit wire fraud and money laundering and start his sentence right away.”

PB, spot on brother. This was about trying to balance reality with politically power. Unfortunately power won. It usually does, doesn’t it.

Mike

‘politically’ = political.

Whatever.

Mike

That’s what they always do - go back to prior admins of the same party. The kidz just don’t notice these things.

Probably had a ‘tingle’ run up your leg.

I’m sorry you don’t share in the excitement of a new era like the majority does.

Ex, I am excited, but skeptical. I will give him a fair shot, but expect him to be honest and evenhanded as he promised. If he picks Ruben or Kerry or starts handing our Ambassadorships to Kennedys, I will grow much more skeptical. I expect him to be different. My family are big BO supporters. I am still receiving YouTube links about Palin and McCain and am trying to remind them about how they hated GB & Co. because they were so mean and heavy handed. Keith Olberman contiues to be a total jacks** and may morph into the Dems Rush if he isn’t already there. Not being a sore loser is easy, winning with grace is much harder. He has an incredibly tough job ahead.

The argument against McCain was that he was a continuation of Bush. Obama has to prove he’s not a continuation of Clinton. And I am so sick of hearing how great the Clinton Administration was economocally. Take away the Tech Bubble and what miracles were there in the Clinton economic plan? Zippo!

LOL. Meet the new boss, same as the old boss. Rahm is another product of the Dem chicago political machine. Oh, and he sat on the board of Freddie Mac. Change!

Skeptic,

KO does what he does best…. KO’s the fruity, wacky opposition and makes for hilarious entertainment. And besides, he delivers news and details in depth not found anywhere else with the exception of Rachel. I agree about the grace comment. It’s difficult.

RE: And I am so sick of hearing how great the Clinton Administration was economocally.

The homeowner HELOC ATM re-fi system was runnin’ full throttle under Clinton.

What do you mean my $2500.00 deck addition doesn’t add $20k to the value of my house?

“Rahm is the perfect pick to reach across the aisle.”

Well, at least the Dons of AIPAC will be satisfied.

“he was instantly berated constantly by the left as a war monger, as stupid, as out of control, as an idiot, as evil and uncaring, as a dope…”

And he really did a lot to disprove all of those charges. (NYCityBoy bangs his head on desk.)

“he was instantly berated constantly by the left as a war monger, as stupid, as out of control, as an idiot, as evil and uncaring, as a dope”

war monger - check!
stupid - check!
out of control - check!
idiot - check!
evil and uncaring - check!
a dope - check!

The history was there for all to see in the years leading up to 2000. All you had to do was look.

Check out the Carter years for a lesson in political disaster. Yet, I saw no mean spirit legacy nail him to the cross he deserved. What Democratic president was denigrated by nick name while in office, or out, for that matter. Maybe we should have called Roosevelt limpy or gimpy; how about redneck or hillbilly for Clinton? Kennedy could have been mackeralsnapper, Johnson maybe Dumbo. I dont remember any of these, or any other. I guess the Dems and MSM have given us the OK to pick one that sticks to OB. Any suggestions or are we going to wait until he’s in there to give him the respect that his party so generously provides to our sitting pres?

He knows how to spend the taxpayers money on executive salaries.

Thanks — I forgot about how bad it was this year, as I don’t own much stock…

The economy back then was quite different then it is today. Russia, China, Japan, India and our own US economy were completely different. I think we actually had some manufacturing base back then. While his “tough love” approach would be welcomed, and he is very intelligent, I’d worry he isn’t up to speed on the new economy and that the old playbook would need some serious updating.

I disagree completely.

The “old playbook” doesn’t need updating - it needs to be dusted off and used!

Volker himself says that his old playbook wouldn’t work in this mess.

Volker needs to call up John Madden and work on a new playbook -

Madden: Paul, you have to go in like a defensive back -fakes left, swings right, and boom! knocks wall street right on its ass.

I can envision a Madden/Volker 09 video game - using guys like the Fridge and LT to crush Goldman Sachs guys as they come out of the office after a long day fleecing the country.

That’s OK.

Volcker’s old playbook couldn’t be any worse than the continual “hair of the dog” strategies we seem to be destined for over the next decade.

‘…“hair of the dog” strategies we seem to be destined for over the next decade.’

Worst of all are the repeated nonsensical assertions from the PTB that the next in an endless series of hair-of-the-dog stimulus packages will be the one that fixes all the problems.

Insanity: doing the same thing over and over again and expecting different results.

–Albert Einstein–

So…boomers will not get the “more frequent” illnesses of old age?

Since we are such buddies this am, I’ll tell you that I think Rick Santelli and Bob Pisani are pretty decent reporters. Ben Litchtenstein (sp all on 3?) who is usually on around 6:30 or so is a straight shooter. Dennis Neal is a joke.

Hope you took some Advil for all that headbanging or at least cranked up some AC/DC

Dennis Neal is Larry Kudlow’s “mini-me.” They both need to go…

“Since we are such buddies this am, I’ll tell you that I think Rick Santelli and Bob Pisani are pretty decent reporters”

I agree with Santelli and Lichtenstein. Pisani is a shill, no doubt about it. Dennis Kneale is a worthless piece of canine feces.

NYCityBoy - I’m starting to get a little concerned about your head. If you won’t put a pillow down will you at least think about buying a thick calendar dest blotter to add some protection?

We’ve been cursed with interesting times - you’re going to need to keep all your wits about you.

And the worst part is that my desk has a granite countertop. My eyes are bleeding right now.

“…I think Rick Santelli and Bob Pisani are pretty decent reporters…Dennis Neal is a joke. ”

When I used to watch CNBC, I liked Santelli a lot. He seemed like a rare voice of reason amongst the shills. You’re right about Dennis Neal. I couldn’t stand him.

‘My eyes are bleeding right now.’

Quickly, NYCity! Rinse them out with Jack Daniels!

I didn’t say when to start doing it, did I?

Yep, Nov 15 is due date for hedge redemps…I have to figure more than a few will be cashing out.

As per Alads Nov 28 call on Comex silver calls…I am watching that too. Silver lease rates keep climbing ever higher. Seems less want to lend the hard stuff out…

Yep, watching and waiting……

Ok, I get the stupidity of DCA for the masses with regard to how it’s normally implemented…but you yourself have said estimates within 20% are pretty good. At some point you will be bullish again, and if you decide to step in at let’s say S&P 650, but it runs down to 600, do you not get in more at that point?

If you like it at x, you should like more at <x right? The real issue with DCA as I see it is that most people don’t make an educated estimate of where they should start buying in the first place and they just buy more and more all the way down and call it DCA. So for those people, “x” is a bad estimate to begin with, where as for you it’s a much better estimate and if prices goes below x it may be a relatively minor fluctuation.

The other issue with DCA is the buy and hold mentality. That doesn’t work too well these days, ask people about Ford, GM, even GE. You need to be more active then just pumping $$$ in each month, you need to think about where they are going. Maybe GE with its yield isn’t bad now, but it and many other blue chips have been dead/losing money for years now.

If you like it at x, you should like more at <x right?

Assuming nothing has fundamentally changed, I should add. As skeptic points out, many people aren’t involved and paying attention along the way, they are just buying based strictly on price drops.

I mostly agree with everyone including PB.

Our restatements and re-restatements and re-re-restatements are differences of emphasis not substantive meaningful differences.

Yes, someday I will be bullish. Yes, getting it right within 10% will be a meaningful achievement, and yes, if I liked something at x and assuming that nothing fundamentally changes, I will like it even more are < x.

Sorry, I didn’t read the link, but the only way the new congress would eliminate the “deduction” (it’s really more than a deduction because it reduces your income for FICA/FUTA as well) for 401(K) contributions would be to turn it into a credit. Deductions/exemptions provide a much larger dollar value to people who pay higher marginal rates on their taxes and credits can be structured to eliminate this.

So, ignoring FICA/FUTA and state/local income taxes, if you contribute $10K to your 401(k) and have a marginal tax rate of 35% you save $3500. If your marginal rate is 15%, you save only $1500. Transform the deduction to a credit like the lifelong learning tax credit, and anyone who contributes $10K would get a credit for 20% of the amount contributed and both would save $2000 - more than the deduction for Mr. 15% and less than the deduction for Mr. 35%. In reality, Mr. 15% is unlikely to be able to afford to put $10K in a 401(k) anyway, so he will probably get a smaller credit than Mr. 35%, but it will be the same percentage of savings.

Believe me, that is the sort of thing that MIGHT be seriously considered. Maybe not, because it does make things a lot more complicated, and there is the whole FICA/FUTA thing too, but I think the president-elect has talked about turning deductions into credits in the past, so plausible. Not a slam dunk, but plausible.

It could be that the Dems are making a concerted effort to help the market capitulate before Obama sets foot in office. Loose talk about radical changes to 401(K) plan rules would gitter done pretty quickly. Of course, there is a good chance I am giving them too much credit for understanding the economics of policy uncertainty.

Polly — Would appreciate your opinion on my theory. Many thanks for all of your insightful posts.

Polly
“new congress would eliminate the “deduction” (it’s really more than a deduction because it reduces your income for FICA/FUTA as well) for 401(K) contributions ”

401K deductions from payroll (i.e. contributions to 401K) are not exempt from FICA.

The main stock index in Argentina fell as much as 14 percent Tuesday, it biggest loss in 11 years, on speculation that the government would nationalize pension funds, potentially depriving the equity market of one of its biggest investors.

Telecom Argentina, a large telephone company, plunged as much as 27 percent, the most ever. BBVA Banco Frances and Banco Macro led a decline in banks. Empresa Distribuidora y Comercializadora Norte, the Buenos Aires-based electricity distributor, lost more than a fifth of its value, the steepest fall since its trading debut in April last year.

President Cristina Fernandez de Kirchner, grappling with a financial crisis that has frozen access to credit, was scheduled to propose an overhaul of the pension system at 4 p.m. New York time that may give the government control of $29 billion in privately run retirement accounts.

http://www.iht.com/articles/2008/10/21/business/21merval.php

Bear,

Trying to force a market capitulation before January 20th? Umm…no idea. I would need more than 3 days of evidence to formulate even a wild assed guess on that one. Besides, if they really wanted to do it, it has to be a public thing (or the info doesn’t get out and doesn’t affect the market) so it is soooo traceable to them. And if they really really wanted to do it and had the ability, they would have finished off the job in time for everyone to get their last IRA statements BEFORE the election. After the election they assume that people are already “pricing in” the new president, so it is a little late to be starting.

Craker,

Really? I thought that the box on my W-2’s indicated it was left out…but I don’t have access to my personal financial records now and no time to look it up. I defer to you.

By the way, the whole credit vs. deduction thing can lead to at leat one truely AWSOME tax planning strategy in a year in which you have very very low income and plenty of money in an IRA. I did it once with the life long learning tax credit and it was a sweet deal.

“Sorry, I didn’t read the link, but the only way the new congress would eliminate the “deduction” (it’s really more than a deduction because it reduces your income for FICA/FUTA as well) for 401(K) contributions would be to turn it into a credit.”

Actually it’s not and it doesn’t. Look at your W-2. Your taxable income in box one is less than the amount taxable for Social Security in Box 3. If you add the amount of your 401(k) contributions (or 403(b), 457, 401(a), etc.) back to your taxable income you’ll have the amount you were taxed for FICA. You are taxed for FICA on ALL W-2 income, not just taxable income.

>> If you consider the fact that both Wall Street and people with 401(k) plans would oppose such a move, I don’t think that we need to worry too much.
=====

Well, with (some huge percentage of voters) vocally opposed to borrowing another 700 some billion recently, our mavericks in congress can still stand on their own hind legs.

I wish I could close out my 401k. The funds my co has offered are small in quantity/choices compared to other Fortune500 Corps. Much much less choice, and in the last 2 yrs also instituted severe penalties like having to stay in those funds for 60-120 days. Ridiculous.

You are not alone desertdweller, mine has instituted those penalties as well.

How can we create an environment of concern and safety for employees without just leaving them in money markets…

I have often wondered if it would be possible
for 401(k) plans to offer a direct investment
in physical gold.

Would bypass the Wall Street issue and would allow
individuals to build up savings that would be
independent of fiat money.

I dislike 401K’s for many of the same reasons. They inflate the values of stocks. They leave your money out in the open for the government to come along and steal in the future. They restrict you to a small set of investment options.

I have a feeling I may be able to empirically test this Not by choice, mind you…

I have to laugh at myself, actually. I’ve not touched my “savings” yet at all in the month and a half I’ve been unemployed (just been slowly drawing down the balance of my last paycheck), yet I’m worried about just how long this will last, and whether my savings will hold up.

Honestly speaking, I could endure well over a year unemployed with my current lifestyle, and considerably more if I were really careful. But I’d much rather not burn through the money from my house, nor my Roth IRA (that which I can withdraw w/o tax penalty). Luckily I saw this coming and had made a concerted effort to build up my savings over the past year.

But I’m not sure if I’m what you mean by “working people”, being a white collar worker — software developer.

‘Honestly speaking, I could endure well over a year unemployed with my current lifestyle, and considerably more if I were really careful.’

Well, I’m very glad you were wise, drummy. Now you can sit in front of the computer eating snacks all day and getting super obese and blogging and researching obscure crap! Wheeee! And not be out begging for a job at Taco Bell like some of the people we get to read about lately, who 1–Didn’t see it coming and 2–Didn’t save and prepare for an emergency.
Didn’t someone post something the other day about something like 67K people applying for one of 600 jobs at a new casino in Vegas? Was that PB? I bet I got the numbers wrong, but it was a hair-raising set of digits, I recall.

Anyway, good luck and best wishes to you drummy, and again–I’m glad you were wise.

Thanks, Oly. I’m actually heading up your way to beg for jobs/change in a more liberal state Even though BanteringBear recommended against it a few weeks back, I’ll be up there next weekend looking for rentals in the Seattle area, and likely moving up there at the beginning of September. I figure if I’m going to be unemployed, it might as well be somewhere I’ll enjoy more on a day to day basis.

er, December, not September

What I recommended, was finding a job before moving here. There are too many people doing EXACTLY what you’re doing. Perhaps you’ll have a leg up on your massive competition, but if not you could burn through cash awful quick. Seattle is one of the most expensive places to live in this country. If I were unemployed, it’d be one of my last choices.

This.

Seconded, and thirded.

Or, as an old acquaintance once said to me, “if you get below 5 grand(in the bank) in this town, you’re in real trouble.”

He weren’t kidding. Not a good place to come if you have no job or cash, or at least family to bum off of. The places you will end up sleeping in will be mold/mildew infested and damp. It will rot your brain.

If you’re a single hetero male, good luck finding a date. If by some miracle you do, more often than not they turn out to be total flakes. Sometimes fairly intelligent, but flaky.

Run away! If I didn’t have a kid here, I would be outta here like shit through a goose.

Seattle has the highest suicide rate in the country, particularly for single males. Trust me, there’s a reason for that….

SR

That’s interesting, as in the late 90’s and earlier this decade, myself and nearly all of my hetero male friends in the Bay Area ended up marrying women who were living somewhere else when we met our eventual spouses.

Finding dates locally was certainly never a problem, but all but one of us eventually met, dated long distance (at least for a short time) and married women who were residing in or just barely arrived from Finland, Canada, the Central Valley, Seattle, NYC, LA or Tahoe.

For years I often found women living locally were off the scale with flakiness, in some cases particularly those raised here (sorry, but it was true!). Many that were not were instead gold diggers in hiding. I learned that the latter’s attitude apparently derived from their thinking that they were entitled to marry a dotcom millionaire, though the odds of ever meeting one over that time period, and in ensuing years, dwindled by the second.

Interestingly, some of the women were well more than capable of making their own million - or more!

Over time, by contrast, it appeared that women from other cities were more sane, realistic and down-to-earth. Simply, women from out-of-town just seemed to be more likely to have their act together. This was particularly true of New Yorkers, a breed I had never really liked much while growing up nearby in New England.

And I recall the media in SF used to complain about how local women “can’t find a decent man.”

Well… perhaps there was a reason for that!

I’ll be up there next weekend looking for rentals in the Seattle area, and likely moving up there at the beginning of September. I figure if I’m going to be unemployed, it might as well be somewhere I’ll enjoy more on a day to day basis.’

Seriously, drummy? You know what, you should stop by Olympia on your way. I’ll introduce you to the best dive bar in the Universe. Any time in Olympia and you’ll just change your mind and decide to stay right here, which is, as we all know, the Best Place in the Universe.

I enjoyed renting in West Seattle a half mile inland from the Vashon Island ferry dock. Nice walks down to the water, good connectivity to everywhere but the East side (across the lake). If you work downtown or South, West Seattle is a good neighborhood.

A couple of my photos in that area:
http://www.panoramio.com/photo/2110548
http://www.panoramio.com/photo/2110543

And depending upon how competitive the market is, the difference may go to neither the worker nor owner, but to lower product prices to the consumer.

And don’t forget that when it goes to the govt, it doesn’t just get lost. It goes to pay govt workers and companies that produce things that the government consumes: Marines, astronauts, bridges, etc…

Nothing (and a lot). Their plan, as I recall was to have a bank branch in every store. They could cash your check and send you shopping in the megamart ASAP. I think they were also behind the big lawsuit against Visa and MC. I don’ t think the branch roll-out has happened yet, or if it is still on the table, but if it does, they might be your one stop shopping for everything. Imagine Joe 6 pack banking and shopping at Wal-Mart, talk about world domination….

They must spend billions in fees to credit card processors. Having their own card might just save them a lot of money.

Remember when Sears would only take Sears Card?

I get your drift on the in-laws. Nothing is more comforting knowing you can visit family without having to sleep there. I prefer a fifth wheel.

40 years ago granville, F. Edward, Hudson falls, greenwich, basically all of Washington County had a strong economy. Two GE plants, scores of paper mills, a handful of large foundries and every single one of them have closed shop beginning in 1981. Affordable housing was everywhere. What changed? Nothing. Those plants have long since shut off the lights so how do you account for the housing prices? Take note that Warren/Essex NEVER had any substantial industry and RE was always cheap. I recall my father telling me about numerous guys from Johnsburg, North Creek and BM Lake who would commute all the way to FinchPruyn paper mill in glens falls because there was no full time work in northern warren and essex. This has not changed either.

The forecast for these industry-less areas is quite clear. And VT border counties are no different. The further north you go, the more economically dark it becomes.

I’ve been in every one of those towns in the last 6 months and agree. Other then the PCB’s GE left behind, there isn’t much left. Wasn’t there also a Scott tissue or some other plant that had a nasty strike and major layoffs? I think there was a medical company also in one of the small towns. With Finch being gone, I wonder what will happen to their real estate holdings. They are vast and economically/environmentally important. One the r/e issue, when we were looking for the Camp I had realturd try to sell me a camp on leased land with only a year to year lease on the land. I went to look at it not even thinking it could be on leased land (foreign concept to me at the time) and that it was a good deal ($75,000 for a very nice, but simple lakefront camp). Once I got that info out of her, she told me it would “never be an issue.” I ran away from that deal and she was shocked I thought the Lease could be an issue. I just heard the Leases are not being renewed….

“but I am not sure how to value not having to sleep at the in-laws when we visit.”

Priceless???

Yes. Scott Paper, Decora, Hollingsworth &Vose, Sandy Hill, Ciba Geigy(Hercules), etc etc. I could go on and on but all you need to know is tens of thousands of good paying jobs… poof… Evaporated.

The Finch strike was nasty.

Yes, we had this exact conversation a month ago.
Same line of reasoning.
Hope techie and FPSS are right.
(Hope is not a plan. I know professor.)

They probably know better than I. My guess is that this break in structure reflects capitulation mitigation measures. I also suspect capitulation can be slowed but not stopped — it’s too big.

AKA credit which behaves like money in our credit-based system.

“However equity contraction does not subtract from the money supply …”

Equity contraction destroys bank reserves.
These reserves need to be replenished.
The bank replenishes these reserves by keeping the money coming into their coffers rather then loaning it out again.
This action removes money from circulation.

Q. Why is playing the viola like a law suit?

A. Everyone is happy once the case is closed.

“Why are you crabby?”

I like my work, but I don’t like working for a living (i.e., responding to a plate full of tasks handed to me by forces outside of my control), especially during a recession when the inevitable stretching of resources translates into increased work demands without commensurate increases in pay.

“Why are you crabby?”

One more really big issue: I feel like the rules of the game are currently written and implemented to penalize productive efforts (this is the point of the golden-egg-laying goose metaphor above). I deeply appreciate Anna Schwartz’s recent comment on our current economic policy regime:

‘Everything works much better when wrong decisions are punished and good decisions make you rich.’

I don’t know if I would be rich if the rules were written and administered this way, but I am pretty sure I would be less crabby.

It’s the end-result of a monetary policy of “eternal inflation”.

You are paid to figure out the flow of capital into the next asset class a lot more than doing anything productive.

The house-flipping mentality didn’t come out of nowhere.

End the silly monetarist dogma and you pretty much end the gripe of “labor” with “capital”.

Testify, brotha!

‘End the silly monetarist dogma and you pretty much end the gripe of “labor” with “capital”.’

Mine is a gripe of human capital with freshly-printed paper financial capital.

Human capital = labor

Human capital = investment in stock of specialized skills
Labor = flow of human capital services

Currently, only “specialized skill” that is needed is to learn how to funnel your money into the next credit boondoggle.

Do it right once, and you can steal (via hidden inflation) from the “specialized skills” of all your fellow Americans.

What could be better than that?

Can the Fed bid competitively on Treasurys?

Not much. I guess I’m assuming that, like the security briefings, there is probably information hidden deep inside the financial goings-on in this country visible only to a select few.

Then again, he hasn’t demanded a recount yet….

I think the intelligence briefings usuall sober up a Democrat Presidential elect. Unfortunately it did not work for the cheshire cat Carter in 1976. Barack is intelligent enough to listen and he’s nowhere near as anti-American as Carter was and is.

President Carter was one of our most intelligent and ethical presidents, IMHO.

He was advising us to conserve and tighten our belts, and he was right. Sheeple didn’t like it, and voted for “Mr. Popular” Reagan.

Much like the mess Obama had to inherit, Carter inherited a mess as well. He worked toward longer-range goals than what most Americans we accustomed to, IMHO, and that is why he lost. Maybe we’d be better off today if we had listened to him.

Having a high IQ does not mean you would make a good president. There are mensa types, there are people with a high social intelligence, and there are people who have the wealth creation intelligence. Some people have a good mixture. Some Mensa people don’t know how to relate socially or don’t even reach upper middle class.

Jimmy Carter bad mouthing America does not make him intelligent or ethical. He certainly was NOT right about conserving and tightening our belts. Oil prices came down and production increased. The only good thing that happened in the Carter administration was Paul Volcker. Finally Reagan coaxed Congress to cut taxes from the confiscatory 70% maximum rate down to 31%. That allowed wealthy people to invest more and it created JOBS. Obama should look at that history.