Bits Bucket For June 26, 2009
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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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U.S. Consumer Spending Rose, Incomes Gained in May…
June 26 (Bloomberg) — Consumer spending rose for the first time in three months in May as incomes jumped by the most in a year, a sign that government efforts to revive the economy may be starting to pay off.
The 0.3 percent gain in purchases followed no change in April, the Commerce Department said today in Washington. Incomes surged 1.4 percent, reflecting tax cuts and Social Security payments from the Obama administration’s stimulus and driving up the savings rate to a 15-year high.
Government efforts to restore the flow of credit and prop up incomes are making it possible for consumers to spend even as unemployment climbs to levels last seen in the early 1980s. The loss of wealth caused by the worst housing slump in seven decades will prompt households to keep rebuilding savings, indicating an economic recovery will be slow to develop.
“Consumer spending has largely stabilized,” said James O’Sullivan, a senior economist at UBS Securities LLC in Stamford, Connecticut. Stimulus-related measures “have contributed to increasing spending power. It sets the stage for more growth in consumption, and should help jumpstart the economy. Ultimately, we need the labor market to kick in as well,” he said.
“Ultimately, we need the labor market to kick in as well,” he said.
Yeah, I suppose everyone can’t spend all their time at the mall, huh?
“worst housing slump in seven decades”
Which would make that… ‘what’ year?
Oh btw, is this ’savings’ rate ( or “hoarding” rate ) ?
Olygal shall have the last word on “The Gloved One” and that’s IT, alright?
Savings rate or NOT SPENDING RATE? Everyone I know has cut back on spending, but there is no “extra” to put in a savings or invest.
For what it’s worth - I’m not sure why most people on the HBB are hung up about this. For all intents and purposes they’re the same thing, and this phenomenon is very much a good thing for our economic health*.
It seems that us HBB’ers just look for bad news - and when we hear good news we’re hell-bent to twist it into something that’s bad, or at least not good.
Let’s remember that the road to recovery is actually a good thing.
* Unfortunately the good thing that is increased savings is being more than offset by increased government spending; so our overall national economic health may not be improving at all.
I see this as a delevering of households at the expense of government leverage (your *). Overall, this is a good thing, perhaps not on an overall balance sheet basis, but on a cost of capital basis.
Pay down credit card debt by borrowing long term from other people at 4-5%. Seems like we are refinancing and saving 15%!
In my case, I have increased my “savings”, because there is a 50-50 chance that I will be unemployed by the end of the year. And if I’m kicked to the curb, there’s a better than 50-50 chance that I’ll be out of work for a year or more.
No pay raises that I have heard about.
No savings that I have heard about either, save one person who has always saved the max for 401k. I know many who are either getting roomates, or looking to downsize the rental they are in.
I also dont’ see more ppl shopping. Just the necessities.
I suspect that this represents the profligate borrowing less, not others saving more. The question is are they CHOOSING to borrow less, or are they unable to continue borrowing as much as they want?
Me? Okay, DinOr. All I thought when I saw the news on the Gloved One was: ‘Bye-bye, Mr. Singing Molester’. Then I went back to thinking nostalgically about Charlie’s Angels. I’m sure that freakish human-shaped meatwad is NOT hanging around in Heaven with Jill Munroe.
As for the worst housing slump in 7 decades, I am going to be very interested to see what happens around here in the next little while. A wholllllllle bunch of state employees will suddenly become unemployed on July 1st. I don’t know where all the cuts have been made, but seeing as Olympia is the state capitol (even though we’re not very big) a disproportionate number of our citizens are state employees. Jeeze, on the long winding street I live on at least 3/4 of my neighbors were state workers, although most of them are now retired.
So the lay-offs have a greater impact here, I’m sure, and I’m wondering what that impact will be. For instance how soon will foreclosures start to climb, and how fast?
To be fair, Jackson was acquitted on molestation charges due to a lack of evidence. It actually looks like both accusers parents used their children, and false accusations of molestation, to procure huge paydays. When you’re as wealthy and famous as Michael Jackson, the lawsuits line up at the door. I was never a big Michael Jackson fan, and he certainly seemed bizarre, but I’m not convinced he was anything other than a lonely man who never had a ‘normal childhood’, and who made very poor choices by hanging out with children in a vain attempt to live a childhood that he never had. I despise child molestors, but it’s certainly not clear that Michael Jackson was one. If it was, he likely would have been convicted.
On the flip side of the coin, when you’re as rich and famous as MJ was, you can avoid convictions through discrete ‘paydays’ and so forth. O.J. was aquitted. TONS of rich white dudes have avoided consequences they otherwise would have to face. If MJ had been white, I bet it wouldn’t have even gotten to court.
I certainly agree with a lot of what you say. I just thought it fair to point out that Jackson was never convicted of molesting kids, and one could argue, after looking at the facts that are available, that he deserves the benefit of the doubt.
Doesn’t this just reflect the rising cost of gasoline?
What I find interesting is this so called “miracle” savings Americans are doing..the truth is that Americans no longer have a choice, but to save…you want to get into a home..you need a downpayment, even if it is only 3.5% FHA, you want to buy that new fridge, well, credit limits have been cut, interest rates have gone up, and gone are the days of HELCO, you want to go to college, hey, student loans are not a given, and so on..
So the question is, Do Americans really have a choice on whether they want to save or not?
HELCO. That’s a good one. Thanks, Ann!
ann,
Well said btw. That was my guess, but you never can tell? Maybe now FFB’s ( Former F’d Borrowers ) will replace that fridge b/c it no longer ‘works’ ( not b/c it doesn’t match their pergraniteel? )
Breaking news -
Stocks Fall as Savings Rate Jumps- AP
Surely this is a terrorist act targeted towards Corporate America. Someone needs to put a stop to this.
On another note, didn’t Obama back down from requiring the AIG folks to return the bonuses due to contact law? How is it Obama discarded contract law with regards to the GM bondholders?
Because in GM’s case, he was discarding it in favor of a Union, not for the taxpayers.
You guys are acting like the union’s stake in a government “supervised” car company is some kind of asset.
At this point, Chrysler may have a better future than GM.
Weren’t the bondholders getting a premium because there was a chance that GM would default?
Anyone with a lick of sense would have realized that if the US Government baled out the parisitic Bankers, there was NO WAY that they were going to let 10-15% of the US labor force go down the tubes with the automakers and their attached industries.
And when the government gets involved, common sense gets thrown right out the window, along with the so-called rulebook.
+1, Ann. Credit tightening shows up as savings, since debt reduction is counted as savings.
Chase raises their minimum payment standard, and suddenly many Americans have no choice but to “save” more.
Whether this accounts for a significant share (or all) of the increased savings rate, I don’t have a good sense. I’m sure many people are still totally willing to consume right up to the limit of what they are allowed to borrow.
My gut is that the effect is due to both banks being less willing to lend, and borrowers being less willing to borrow. To what extent each, I wish I knew.
DId anyone hear yesterday’s NPR Marketplace segment on folks going cold turkey on their credit cards? I probably haven’t charged anything in about 4 months, and use a debit card for convenience.
The only reason for a credit card is to protect your debit card and for convenience.
Why you ask? If you use that little Visa logo on your debit card to it’s full potential (i.e. use debit card as a credit card) then someone with your number can empty your bank account.
With a credit card you have charges you can dispute the charges if someone has fraudulently used it. With a debit card you are trying to get your money back.
In the end you win either way. Just scarier trying to get your money refunded vs. disputing a charge.
Question: Are forgiven loans or defaulted loans counted as savings?
Guys, it doesn’t really matter whether ppl are doing this voluntarily or not. The only thing that matters is that they’re doing it. Yes, the new savings era is probably being caused by credit tightening, just as the recent debt era was caused by too much easy credit.
“The 0.3 percent gain in purchases followed no change in April, the Commerce Department said today in Washington. Incomes surged 1.4 percent, reflecting tax cuts and Social Security payments from the Obama administration’s stimulus and driving up the savings rate to a 15-year high.”
But how much of that supposed increase in the savings rate is really nothing more than reduced spending on consumption that is now being used to service debt? Is there actually any real increase in savings? That would be good long term if there were, but I doubt it’s happening.
Incomes surged 1.4 percent, reflecting tax cuts and Social Security payments from the Obama administration’s stimulus and driving up the savings rate to a 15-year high.
Are they implying that we’re giving people more SS money than we were before? I hadn’t heard that before, and if so, it’s ridiculous. Massive deficits and we’re trying to bankrupt SS faster?
Also, nice to see the plan is to divert money to non producers. And since we don’t have any actual money, we’ll borrow it from tomorrow’s producers.
“Are they implying that we’re giving people more SS money than we were before? I hadn’t heard that before, and if so, it’s ridiculous. Massive deficits and we’re trying to bankrupt SS faster?”
Due to higher inflation last year, the increase in the SS COLA this year of 5.8 percent was the highest since 1982. However, the increase scheduled for next year is zero.
http://www.ssa.gov/pressoffice/pr/2009cola-pr.htm
http://www.dailyfinance.com/2009/05/08/no-social-security-cola-in-2010/
Since the ‘real’ interest rates are negative, can’t we reduce SS payouts?
“Consumer spending rose for the first time in three months in May as incomes jumped by the most in a year, a sign that government efforts to revive the economy may be starting to pay off.
The 0.3 percent gain in purchases followed no change in April, the Commerce Department said today in Washington. Incomes surged 1.4 percent, reflecting tax cuts and Social Security payments from the Obama administration’s stimulus and driving up the savings rate to a 15-year high.”
I live in a nice upper middle class to affluent area comprising approx 20,000 households spread out over approx 25sq miles. Nobody I know is spending more or getting raises.
0.3 is for all practical purposes, nothing. And 1.4 is not a “jump” no matter how drunk you are.
Once again we’re seeing data skewed by what has to be obvious outliers.
“Incomes surged 1.4 percent, reflecting tax cuts and Social Security payments from the Obama administration’s stimulus and driving up the savings rate to a 15-year high.”
I’m also having a hard time believing that typical household incomes have increased much at all, much less “surged”.
With the increasing number of unemployed and underemployed, some employed getting wage cuts and most of the rest with stagnant wages, I think you’d have to do very careful parsing of the data to find much if any increase in wages.
“As Americans struggle through the worst economic downturn since the Great Depression, the emergency supplemental appropriations bill [in Congress] sends $660 million to Gaza, $555 million to Israel, $310 million to Egypt, $300 million to Jordan, and $420 million to Mexico. Some $889 million will be sent to the United Nations for so-called “peacekeeping” missions. Almost one billion dollars will be sent overseas to address the global financial crisis outside our borders. Nearly $8 billion will be spent to address a ‘potential pandemic flu’ which could result in mandatory vaccinations for no discernable reason other than to enrich the pharmaceutical companies that make the vaccine.”
This is a comment from the Texan in Congress many people think is a screwball. Dr. Ron Paul would like to see the United States operate within its means and re-establish a system of honest money. An impossible dream, of course. Prudence and honesty are not popular.
Peace is expensive. War is expensive. Empire is expensive.
Peace is expensive. War is expensive. Empire is expensive.
Actually only one of those three is.
Peace implies no action, so is net 0.
War is net negative, thus yes expensive.
Empire tends to be net positive, financially at least. Politically - usually not so much.
Empire tends to be net positive, financially at least. Politically - usually not so much.
Net postive financially for the politically well connected. Not so much for the average citizen who pays for empire via inflation, war and increased terrorism.
BINGO Packman. Need proof? Take a look a the british crown. Nobody can squeeze blood out of a turnip like the UK.
Empire requires war and is the absence of peace as the Empire is at war with its citizens collecting taxes, regulating, etc. The cost opportunity costs of big government (empire) are beyond comprehension.
Just remember, in history..every “great” Empire has fallen…
“Just remember, in history..every “great” Empire has fallen…”
Timberrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrr
Just remember that tomorrow is yesterday tomorrow, and that nothing is forever.
Including the USA, and you and I.
Jack
Empire tends to be net positive, financially at least. Politically - usually not so much.
Empire tends to be net positive when things are going well and the resources are selling and the chattel are behaving themselves. When there are shortages and supply chain issues and uprisings and insurrections and natural disasters and “unforeseen” consequences to empire-building behavior, not so much. Ask our British friends how profitable empire was on the downward side of the curve.
Yeah that’s what I was implying by my “politically - no so” part. As long as the empire is building and/or stable - usually they’re profitable. That will most likely include the U.S./British oil empire BTW, but also see British 1700’s example, and also Holland, France, Portugal, Spain etc. from the same timeframe, and past examples of Romans, Greeks, Chinese etc.
It’s after the empire becomes unstable, requiring war to attempt to maintain it, that it becomes net negative. But was I was including that under the “war” part, not the “empire” part - though it’s really both; the two overlap.
Yeah that’s what I was implying by my “politically - no so” part.
Ah, gotcha. By politically I thought you meant bureaucratizing and legislating an empire on the domestic front. We were saying the same thing, however.
On the so-called “downward side of the curve” the British did manage to squeeze millions of men out of their turnips to fight on their behalf for the so-called “world war”. The “downward side of the curve” included at least one major famine caused by what can be charitably characterized as “negligence” by the turnip juicers. Coincidentally, that famine happened at the same time as war efforts were in full swing and resources from all colonies were being misappropriated towards this end.
So yes, the British benefited from “downward side of the curve” just as much as Goldman does when the stock market moves downwards.
I agree…why should “peace” cost money…where are the days when diplomacy paved the way…?
Unfortunately much of what we call “diplomacy” consists of promising aid, trade favoritism & loans to various regimes.
Empire is only net positive while you’re expanding and looting. It quickly becomes a negative once you’ve looted and need to pacify an area, thus requiring larger and more treasure laden areas to take over.
At this point there’s not much chance of expanding empires.
Capturing a tin mine can improve your balance sheet. But there’s no inherrent reason that running a tin mine in a foreign country should any more efficient than in one’s own. Ditto farms, plantations, tax receipts etc.
Funny you should mention tin mines, Jim.
Part of my family hails from County Cornwall, which is way out there in Britain’s wild west. Back in the 1800s, when the Empire was kickin’ right along, the Cornish tin mining industry was too.
Then the Empire started importing cheaper tin from Malaysia. And that doomed Cornish tin mining.
Thousands of Cousin Jacks and Jennies left to seek their futures elsewhere. They had to. According to one of my elderly relatives, people were starving to death.
These days, Cornwall is a major holiday destination. Among the main attractions are the ruins of the tin mines. They’re quite picturesque. People come from all over the world to see them.
But the Cornish economy is but a shadow of its former self. County Cornwall is now one of England’s poorest.
And of course there was a special court system with Stannary courts for tin miners.
http://en.wikipedia.org/wiki/Stannary_Courts_and_Parliaments
Repeated Grand Theft on the part of the government is oh so expensive!
Those who have been staring at the “Social Justice” sock puppet to their right may be shocked to find the “Hidden Tax” sock puppet from the left just stole all their candy.
Such is the penalty associated with being comfortably seated in the MSM constructed high chair designed especially for politically naive newbies.
Cry your eyes out.
?
!!
DinOR,
Just the usual right-wing talking points.
oxide,
Left OR Right, why be so ‘cryptic’? ( Evidently I’m a “newbie” ) ?
Why don’t you just stop paying taxes then? Get rid of your social security number, and opt out of the governmental system…
Be your own bank and pay for things with silver and gold coins. Move to a small town in Montana.. I bet it will not even be that hard…
With all the money you save not paying taxes, you will probably be able to pay the best doctors in the country, and maybe even get some form of “international” health insurance..
You can invest via offshore banks..
Empire? War? Peace?
Google Matt Tabbi and his latest “The Great American Bubble Machine”
We ALL work for Goldman Sachs.
Let’s not forget the 600 billion to 1 trillion wasted in Iraq which dwarfs those supplemental bills, cudos to Ron Paul for voting against the war profiteers.
Here’s a list of senators that voted against the war:
Daniel Akaka (D-HI)
Jeff Bingaman (D-NM)
Barbara Boxer (D-CA)
Robert Byrd (D-WV)
Lincoln Chafee (R-RI)
Kent Conrad (D-ND)
Jon Corzine (D-NJ)
Mark Dayton (D-MN)
Dick Durbin (D-IL)
Russ Feingold (D-WI)
Bob Graham (D-FL)
Daniel Inouye (D-HI)
Jim Jeffords (I-VT)
Ted Kennedy (D-MA)
Patrick Leahy (D-VT)
Carl Levin (D-MI)
Barbara Mikulski (D-MD)
Patty Murray (D-WA)
Jack Reed (D-RI)
Paul Sarbanes (D-MD)
Debbie Stabenow (D-MI)
the late Paul Wellstone (D-MN)
Ron Wyden (D-OR)
Cudos to them.
A surrender would have be welcome to some!
Jack
Lincoln the lone Republican? Ironic!
Actually I’m pretty amazed at how quickly the bailouts and stimulii are becoming as expensive as war and occupation.
At least we’re wasting the money with a lower body-count. And if we’re lucky, we MIGHT have some infrastructure as a bonus.
http://www.comptrweb.com/tgabm.pdf
Read this all the way through. It’s worth it and I will be referring to it often in the future.
Some good news in the race between Americans adjusting their lifestyles and the possible bankruptcy of our country and collapse of our currency: savings rate up to 6.9%
http://www.msnbc.msn.com/id/31564909/ns/business-stocks_and_economy/
We’d better buy our debt, because the Chinese don’t want it.
http://www.bloomberg.com/apps/news?pid=20601087&sid=a5z7pjiZoYpg
“Zhou Xiaochuan sees the current international financial system is flawed, putting too much emphasis on the dollar as a reserve currency.”
Well that’s what happens when the whole world tries to generate jobs by exporting to the U.S. That flaw is the other side of the coin.
WT Economist,
No doubt Americans -are- increasing their savings. Little late.., but? Again though, is this savings “with a goal in mind” ( college, down payment, car? ) or is this just battening down the hatches?
“the whole world tries to generate jobs by exporting to the U.S”
That’s why The Onion is such a must read today!
“American robot’s job outsourced to overseas robot!”
The whole issue is dedicated to less than dedicated American workers. Anyone know how to do a screen save?
or is this just battening down the hatches?
Yes.
This isn’t some newfound fiscal responsibility - yet anyhow. Hopefully that will come though, like it generally did as a result of GD1.
packman,
I can’t know “what’s in the hearts of men” so it’s just a SWAG. I will say ( anecdotally ) from my catbird seat high atop the ’second’ floor of my prestigious office in Marion County, OR that contractors ’seem’ to be quite busy?
Every pick-up that goes by is loaded to the sideboards w/ plumbing, roofing & landscaping supplies! Is this just contractors “stooping” to the work they thumbed their noses at during Le’ Boom? Busy Beavers! Go figure.
I hope everyone recalls that the savings rate is calculated as the (net income - net expenditures) / (net income). Paying down debt counts as savings, even though it is just offsetting past savings.
Furthermore, in an period of declining salaries and increasing unemployment, it takes more “savings” too offset previous “spending”.
CTRL + Print Screen
Paste to your favorite picture editor and save it. A fun trick is to do this to an unsuspecting cohort’s desktop and open the picture on their screen… they will get irritated when they can’t open anything!
Hey, DinOR, don’t hate! They could be busy Ducks!!
And if the trucks are full of supplies, perhaps that’s because the supplies aren’t being installed anywhere….
sleepless,
Have it your… way! You know, when you walk to work and then have only to glance out your off. window, you get a different perspective than you did when you were a long-range commuter?
I’m simply agog at the “bustling” activity? Granted, much of it is probably replacing a door or minor addition but ‘that’ is more what these guys were actually adept at?
Can’t speak for others but I never made the assumption that my Assoc. from SIU in any way qualified me to be a “developer”! ( Which is why I stick to my knitting, I suppose? )
Screen save? Easy. Just hit “Print Screen” to make a screenshot. Then open up a bitmap program like Photoshop. Or the Windows paint program (whose name escapes me).
Create a new file in one of these programs (keyboard shortcut: Control-N). Then paste the screenshot (keyboard shortcut: Control-V).
Or just do File>>Save As… in your web browser to save the HTML file (and supporting files - graphics, etc) to a place of your choosing.
I’m a fan of printing to .PDF file, but I’m a mac user so it’s built into the OS
Or the Windows paint program (whose name escapes me).
That’d be “Paint”.
(seriously)
LOL!
Thanks all! I’ll give it a try!
I like that Sanford’s mistress’s job was outsourced to Argentina
Don’t cry for me, Argentina.
Some good news in the race between Americans adjusting their lifestyles and the possible bankruptcy of our country and collapse of our currency: savings rate up to 6.9%
Good.
Too bad the federal government is more than offsetting that, or else we would actually be making progress economically as a nation.
Said it before and say it again: by the time this crisis is really over American will learn to save again, possibly up to 10%.
One of my HBB predictions that is coming true… one for ten so far.
Woo-hoo!!!
Yeah I think the savings rate will push up to 10% and maybe beyond. The grasshoppers are not fiddling as much!
I figure most of the savings are going into money market funds. Some in T-bills, which are my preference, and some in CDs.
Yes, but this savings rate is being artificially pushed up by already-habitual savers who regularly save over 10 percent of their gross incomes now saving even more because they’re scared/nervous/just feel like it. I’m a case in point. I’m in a mindset of “ya never know” and I’ve been there for months. I don’t know if the rest of America has given up on buying their kids every GameStation 2 game and Barbie play house quite yet. I could be wrong, but I don’t think the general populace is there yet on savings, or they’re so far underwater that they’re unable raise their savings rate very much.
Silverback 1011,
Even better… points! Hard to save when you’re on freaking UNemployment isn’t IT?
( What’s a “GameStation”? ) Anybody..?
typo, probably “Playstation” i.e. Sony Playstation
What’s a “GameStation”? ) Anybody..?
I believe that its a fictional game console featured in a cartoon show about 5 teen super heroes.
Hee, hee, well, you’re all entirely right. I’m just so freakin’ old I evidently know the proper name for the product. We don’t own one and probably never will. I’m so old, I played D & D out of books.
Ahm not on unemployment, luckily.
My understanding is that savings in 401ks do not count in the calculation of the savings rate, so people stopping 401k constributions in favor of paying the taxes on the income and then saving it outside a retirement plan or using it to pay off debt will also boost this number.
I think my wife and I are up to almost 25 percent right now. (Way more ‘after taxes’)
IIRC, Americans saved 10% of their income until the end of the 1970s. Feel free to correct me on this statistic.
That much or more. Reagan justified raising taxes on wages and cutting taxes on investments in order to get the nation’s “bad” rate of 10% up.
We’ll have to get that high and higher, and stay there.
As for outsourcing and importing, it isn’t as though lots of Americans were sitting around doing nothing until 18 months ago. They were working, more than most people in the world. All that debt is what was required to support a lifestyle beyond even our ability to produce.
We can’t work more in the long run. We’ll have to consume less.
“and stay there”
+1
Assuming any of it is legit, just having a temp. knee-jerk reaction to the worst financial crisis in human history won’t cut it!
Start liking it America!
Investments aren’t savings, yo.
Hence,
A house is not an investment which equals not saving.
I remember Reagan raising taxes. My paycheck suddenly didn’t go very far and wages didn’t keep up.
Americans work more hours than anyone else in the INDUSTRIALIZED world, yet our “productivity” is only a few percentage points higher. So little it really doesn’t make any difference… except to the banks.
And WT Economist, you’re right. There are only so many hours in the day and the week and wages haven’t been keeping up with real inflation for decades.
IIRC, Americans saved 10% of their income until the end of the 1970s. Feel free to correct me on this statistic.
That’s correct.
Which is why I get pretty steamed when headlines talk about people “hoarding” when the savings rate is at friggin’ 5%. The implication is that if you’re not buying lots of toys, too-expensive-houses, cars, etc. then you must be greedy!
That’s how ingrained the consumer culture has become (as pushed by the MSM, by proxy from companies who pay their bills, and as enabled by corrupt bank/government lending practices.)
I have a graph of that stat BTW - I’ll have to post it later though. It’s from BEA. You could probably google “personal savings rate” and find it.
Here’s a link : http://research.stlouisfed.org/fred2/data/PSAVERT.txt
According to this, we dropped below 5% back in 1995 and never looked back. Before 1994, we’d never dipped below 5%. It looks like we bounced around between 6 and 10 since ‘59 and only in the last decade and a half have we completely lost our minds.
Thanks for that link sfbb - I didn’t know that was in the FRED data actually.
Here’s a link to the corresponding graph:
Personal Savings Rate
packman,
Your link is way more useful!
WT Economist:
“As for outsourcing and importing, it isn’t as though lots of Americans were sitting around doing nothing until 18 months ago. They were working, more than most people in the world. All that debt is what was required to support a lifestyle beyond even our ability to produce.”
Americans may have been working a lot, but I can’t say that they have been producing. More like financing and retailing for real producers overseas.
Neither financing nor retailing add much value to the supply chain, hence the decline in real wages.
Exactly Jon.
We’d better buy our debt, because the Chinese don’t want it. But then we’d have to have savings=debt on a national level, and unfortunately we have structured our economy around spending more than we make.
Cap&Tax has nothing to do with the environment, it’s all about power and control. If and when it passes,(funny how the vote goes to the floor after 5:00 this afternoon) this egregious tax will hit everyone’s pocket book and will do nothing the global warming alarmists think it will.
Big Oil’s Answer to Carbon Law May Be Imports, Idle Refineries…
June 26 (Bloomberg) — America’s biggest oil companies will probably cope with U.S. carbon legislation by closing fuel plants, cutting capital spending and increasing imports.
Under the Waxman-Markey climate bill that may be voted on today by the U.S. House, refiners would have to buy allowances for carbon dioxide spewed from their plants and from vehicles when motorists burn their fuel. Imports would need permits only for the latter, which ConocoPhillips Chief Executive Officer Jim Mulva said would create a competitive imbalance.
“It will lead to the opportunity for foreign sources to bring in transportation fuels at a lower cost, which will have an adverse impact to our industry, potential shutdown of refineries and investment and, ultimately, employment,” Mulva said in a June 16 interview in Detroit. Houston-based ConocoPhillips has the second-largest U.S. refining capacity.
The same amount of gasoline that would have $1 in carbon costs imposed if it were domestic would have 10 cents less added if it were imported, according to energy consulting firm Wood Mackenzie in Houston. Contrary to President Barack Obama’s goal of reducing dependence on overseas energy suppliers, the bill would incent U.S. refiners to import more fuel, said Clayton Mahaffey, an analyst at RedChip Cos. in Maitland, Florida.
“They’ll be searching the globe for refined products that don’t carry the same level of carbon costs,” said Mahaffey, a former Exxon Corp. refinery manager.
They are already talking about adding Tariffs to account for those that want to shift manufacturing or energy production outside the US.
I’d favor a carbon tax over cap and trade with all money going to reduce payroll taxes or provide tax breaks for energy conservation.
“They are already talking about adding Tariffs to account for those that want to shift manufacturing or energy production outside the US”.
And the additional costs will be passed right on down the line, or close the company.
“And the additional costs will be passed right on down the line, or close the company.”
Agreed. Though I am not aware of a better way of reducing carbon emissions. Any ideas?
“Though I am not aware of a better way of reducing carbon emissions. Any ideas?”
Stop Breathing? Not sure.
Yes, that’s the point of a tariff, wmbz. You do realize this is a blog about the housing bubble, right?
IF Obama were in the smallest bit serious about fixing our economy and energy independence, we would be seeing vast projects designed to put solar power onto the roofs of every structure in America. Such a “works” project would put millions of Americans to work (assuming we did not just import the panels from China and the cheap labor from Mexico) and would in the medium long term go a long way to solving our energy problems. And YES solar power is economically feasible today, and with increased production comes decreased costs, making it even more so.
Instead we are to be hit with yet another massive tax increase, which will force us to work more, drive more to work and afford even less solar units resulting in a massive increase in dependence on foreign oil and increased greenhouse emissions. I seriously doubt increasing tax in a depressionary recession will do anything but make big oil richer and the rest of us even poorer.
Do not EVER believe a thing Obama says. Just watch what he does, only. He is the master of the head fake. Just about everything he touts as “good for the people” is just the opposite.
palmetto,
Oh I don’t know about that? I think he has/had good intentions, and this was my worry. McCain had NO delusions about how DC works.
Still, I agree w/ GH that it would be a wonderful undertaking. Just… *not in Oregon and our 6 weeks of Summer.
*not in Oregon and our 6 weeks of Summer.
Strangely enough, the biggest user of solar panels worldwide is Germany.
Having lived through many Northern European summers, I can attest to the lack of direct sunlight up above 50 degrees lat. We live like Morlocks up there
And GH - totally agree with you about the solar panel thing - the govts pumping in a few billion to ‘weatherize’ housing, why not take the time to put a few solar panels up at the same time?
It may not be the solution for business and industry, but its feasible to make enough power for residences to power some (if not all) of their own power.
Oh, and Kudlow hates the Climate Bill - which gives me hope that it might have some legs after all…
speedingpullet,
I have a friend that retired up toward the OR Dalles. One of the best ME’s “I” have ever met. He’s gone off-grid w/ a windmill, solar etc. and it’s… a constant pain.
True, his MIL lives w/ them and she can’t ’stand’ anything over 70 so he’s running Central AIR 24/7 for months, but there’s lots of upkeep and “brown-outs”. Batteries need to be replaced etc. You’re basically starting a utility company for (1).
I think if you’re going to get serious about it, you just have to use a whole different yardstick to measure your standard of living?
I understand what you are saying. Several years ago we built a house out in a very rural area. We installed two turbines, primary and back-up, solar hot water, and PE panels. The reason for doing it was because it was cheaper than the cost of commercial power due to the distance to the commercial power. In our case we needed to buy and bury two miles of service line. It worked fine, but you had to really be aware of power usage. Some mornings we had to decide between coffee or toast. You quickly become aware of the phantom power loads caused by modern appliances. Of coarse, the size of the system is based on what you can afford. What people don’t understand is that these systems require constant, costly maintenance. If you can’t climb a tower or do your own electrical work don’t attempt it.
What is geo themal not pushed more ? It’s using the earth as a heat pump. Ground down below the frost lines is a constant 50 degrees year round. Has been used in commercial industrial applications for about 50 years.
Anon in DC,
Especially in my target area of Klamath Falls, OR. Most of the public bldgs. and numerous homes are heated by geo. I’m looking at “heated slab” designs ( among several )
crash1,
I’ve never been out to my buddy’s home, but he’s pretty good at describing the challenges. Since I’m thinking “hay bale” I understand heating ( even in chilly S. OR ) isn’t the issue. Yet I’m willing to consider some fairly extreme measures to get out from under the utility companies. Certainly on a 2nd home. Just what I ‘need’, a SECOND set of bills!
One of the main reasons that I got out of the residential solar business last year was that after a decade or so of being a big proponent, the engineer in me realized that it just doesn’t make much sense at the residential level. Yeah, you can do it easy enough these days, but when you look at the life cycle costs very few residential solar systems will ever achieve a real energy payback.
Instead, put the solar panels on large commercial roofs where there’s enough energy production to justify the monitoring and maintenance, or put them on large utility structures designed to last 100 years. Putting dozens of extra holes in residential roofs that need replacement every 15-25 years, for a trickle of power, isn’t a good idea.
DinOR and Crash1 - I totally understand what you’re saying - going totally ‘off grid’ does require a different way of thinking, and if you’re not willing to invest in the skill-set to make it work, then its probably more hassle than getting the utility guys to come and dig the trench.
What I was suggesting - by my now-apparent-to-me throwaway line was something a little less hardcore.
A LOT of energy is wasted by SFRs for a variety of reasons - largely due (at least here in sunny SoCal) to there being no insulation in the houses, old water heaters, no double-pane windows, lack of provision for separating ‘grey’ water from sewage for watering yards etc…
In addition to bringing these paces up to scratch insulation-wise, it would be feasible to place solar panels on some of the roofs.
No, it wouldn’t make the properties totally ‘energy free’, but allowing SFRs to make a small amount of energy from the roof panels during the day, will in some small way take the load off of the energy plants for the area.
Even if its just heating the pool, or providing enough energy for a dishwasher cycle or a load of laundry - a lot of small measures will add up to less demand from the source. Any easing of pressure on the utility plants will have some effect, even of its small and disparate.
The real ‘problem’ of course is that there’s still almost no decent technology for storage - personally I’d love to be able to recharge my car overnight from solar panels on my garage/carport. But, unless there’s a way of storing the energy after the sun has gone down, then its not really practical.
Personally, I’m looking to make any house I buy as ‘energy free’ as I possibly can, but until good - and practical - batteries are also included in the solar ‘package’, its going to be hard to convince yer average suburbanite that solar is the only way to go. Even here in the state with 250+ sunny days a year.
So, I sound slightly bi-polar on solar (har har), but I think its a fundamentally good idea for us all here in the southern West Coast - but a lot more innovation and research into the ancilliary aspects needs to be made.
speedingpullet,
( Or should we say “Bi-Solar” ) ?
My sentiments exactly. I recently had an energy audit from PGE after complaining loudly about my “estimated” bill.
The guy WAS an expert and pointed out a NUMBER of things I could be doing better! For instance, we have (2) cordless phones. Just think about it. Good thing they’re “cordless” ( otherwise I’d have a tangled mess )
We also have a seperate answering machine!? He gave me mad props for not having a BigScreen TV but pointed to a number of appliances we seldom use but are constantly plugged in w/ LED’s etc. Also pointed to the clock on the stove… PLUS a clock 18″ away on the microwave! Lots of improvements left to go!
For household use, you need costs to be about 1/4 of what they are now & produce about double the power. That may actually be achievable in 10 - 15 years with some of the new technologies by Nanosolar and similar competitors. But its definitely a loser today.
A LOT of energy is wasted by SFRs for a variety of reasons - largely due (at least here in sunny SoCal) to there being no insulation in the houses, old water heaters, no double-pane windows, lack of provision for separating ‘grey’ water from sewage for watering yards etc…
After many years as a solar installer in NoCal, my brother-in-law switched gears — or switched emphasis — and became a seeker of energy inefficiencies.
He decreases energy consumption not by choosing green technology per se (though he will use it if it makes sense for any particular building), but by ferreting out as much waste as possible in the system. He currently works for a large midwestern university, and has saved them millions of dollars with his approach so far.
What the heck happened to nuclear power?
I was once against this, now I feel it’s an option that should be seriously considered.
For me the goal should be to get us out of the Middle East and away from the oil.
Nuclear is good on paper, but it does have the problem of what to do with the waster afterward.
Yucca Mountain, even if the politics behind it were more favourable, is already pretty much ‘reserved’. They’d have to start building a new silo for all the new waste, as all of the existing waste will just about fit into YM.
Plus, you have the problem of getting it from A to B - using our crumbling infrastructure.
Imagine if that train derailment in DC last week had had radioactive cannisters on board? Or 18-wheeler carrying nuclear waste causes a pileup in the outskirts of Philly?
I’ll be ‘for’ more nuclear if they can guarantee a 100% safe way of flying the waste into the sun. That’s pretty much the only good place for it.
But shuttles fail, trains derail and trucks crash occasionally - if humans have a hand in it, at some point something will go wrong, despite all the failsafes.
I personally think the money is better spent on updating our energy grid and working on new ways to provide energy from renewables.
There’s no 100% way to do anything with precision, you realize. Even dropping a quarter onto an ‘x’ in the ground can be disrupted by gust of wind. Dumping the coal waste into the air seems fairly irresponsible as well. You have to pick your poisons (literally) with a lot of these things.
*Note : I’m not saying Nuclear is the only way to go or anything. I’m just saying demanding 100% safety from anything is not feasible, and we’re already polluting like crazy for our current energy consumption.
You can reprocess the used nuclear material and break it down into strontium and cesium which have half-lives in decades instead of centuries. Keep the material on-site and then dispose of it once it’s less radioactive.
Yes, ah…Strontium…..how I love you, in my bones….
I get your point, and a fair few of the nuclear power plants we have already do keep it on site for the above reasons.
I’m just saying that - rather than investing years, and billions, into a technology that’s already showed its flaws to us in the 20th century - we would be better off spending money on something new that doesn’t have the same aftereffects as either coal or nuclear.
Unless we throw out any environmental laws we already have and do like China does, by throwing up a new coal-powered plant a month, then this would seem to be the right time to re-think our energy sources and do something different.
Both nuclear and coal stations require a long time to plan and build, and if we’re looking 10, 20, 30 years down the road, rather than trying to supply our immediate needs, then I would still rather they spent all that time and money on good quality cheap solar, inexpensive batteries and re-gigging the grid to make it more efficient.
I’m not a tree-hugger by any means,I use my AC and have a flat screen TV and have all the creature comforts I could want - but I’d still like to have my power produced in a sustainable way.
Back to burning logs for fuel it is!
Seriously, with aggressive reforestation to recapture the hydrocarbons, it’s Solar without all the fancy high tech stuff!
Okay, so it’s sustainable, but not very scalable. Or portable. Try stuffing your gastank with twigs.
LOL - my car’s already made of spit and baling wire, so a few twigs might actually help some.
You can use them to plug holes in fuel lines and so forth…
But it will make Al Gore’s pockets even deeper!
The fatcats get even fatter.
…and how exactly is solar power going to benefit his friends on Wall Street?…that’s what I thought! Stupid idea.
/sarcasm off
That is what I love most about our “democratic” state. If you voted, it is YOUR fault for voting for these turkeys and if you didn’t it is your fault for not doing your part and voting. Either way, unlike a dictator where it is not the peoples fault, here it is ALL our fault. And yes - sarcasm or not, I agree nothing can happen when our officials serve other masters!
HOWEVER, as an individual, I plan on getting off the grid, both in terms of electrical usage and by buying an electric car, also to be powered by my own solar units. One small problem - $$$ to get the ball rolling. Paying a load more tax will not help me here.
GH,
I’ve been looking for property in So. Oregon to do just that. It’s been explained to me that I need a “solar survey” done first to see it it’s even a prop. that’s feasible.
Another consideration has been… ( for the interim ) going propane. LOTS of people do it there and as long as I’m *not contributing to the ongoing commitment of funding our retired PGE’s CEO $765,000 a YEAR retirement than I’ll have to content myself w/ that.
We would Mandate double or triple the R value insulation in homes, and add solar panels.
——————————————————-
IF Obama were in the smallest bit serious about fixing our economy and energy independence,
Any idea as to how big this bill is? Try 1,201 pages. [pdf] Any idea how many members of the House have read the darn thing? Try zero,not one!
We are talking about a bill that is going to cost us $845 billion + over the next 10 years … and not one House member has read the entire thing.
845 billion + over the next 10 ie less than Iraq war
But it will make Al Gore’s pockets even deeper
Can you tell us how this will make Al Gore richer?? Does he own solar stocks that you know of?
Instead we are to be hit with yet another massive tax increase, which will force us to work more, drive more to work and afford even less solar units resulting in a massive increase in dependence on foreign oil and increased greenhouse emissions. ?????????????????????????
That’s some strained logic my friend. You really think that increasing the cost of fossil fuels will cause us to increase consumption?? Because we will have to drive more to afford the oil???
Cap and Trade should reward people who generate electricity with solar power.
Oh, how do you know?
Oh, how do you know?
Well, it’s been reported on all of the major networks, the chief sponsor admitted that he(Waxman) had not, and he added a 300 page amendment late last night and that no one has had time to go over. One little beauty in the proposal is a tax on cow farts! Pure genius.
Cap&Tax has nothing to do with the environment, it’s all about power and control.
You are right. Cap and Trade is, for the most part, the smokescreen which Obama wants to use to jump-start the renewables economy. If oil and gas are expensive, then wind/solar become cheap enough overcome the investment hump and achieve economies of scale, enough to compete with oil/gas.
The environment is basically a side benefit, and will come later.
Obama can’t do much more at the moment. When damn banks recover, when the troops start coming home for good, and maybe when companies and employees both aren’t shackled by the health-care system, then Obama can look at “vast projects.”
The environment is the smallest of the side benefits. Getting off imported fuels is a national security issue. We could probably support ourselves on electric made by burning coal for a while, but that environmental impact would be more than we could stand, so renewable it has to be. I do not want to have to go begging to the Russians when the Middle East runs low and Siberia has warmed up enough to make drilling easier.
I would like to see investment in a continent wide massively redundant power grid so you don’t have to put solar panels or wind turbines or tidal yo-yos absolutely everywhere. Widely distributed maintenance is very costly. It would be nice to be able to concentrate the maintenance at least a little. And you could put a few nuclear plants in places that are empty enough to not have violent NIMBY reactions.
Polly,
See my post above.
Agree with you 100%.
oxide,
Well, talk about more insane driving!? I think for me, the canary was re-treaded tires. We could save so much energy and nat. resources it’s just silly.
But we don’t. The last maj. plant in OR was shut down almost a decade ago as NEW imports came in cheaper than we could re-cap e-x-i-s-t-i-n-g tire casings. If someone can show me we’re serious about practical ( and established ) solutions like that, then I can get onboard. Til then?
But according to my esteemed critics above, it’s just “a right wing talking point” which would never affect the politically correct in any negative way.
Wait, which part of this is the right-wing talking point? This sounds like a regular discussion.
I love Carlin’s rant on saving the planet. And I’d still like to know how Barry plans on getting Chindia to to play along. BOHICA America!
http://www.youtube.com/watch?v=eScDfYzMEEw
“And I’d still like to know how Barry plans on getting Chindia to to play along”!
Chindia could not care less what Barry or any other political U.S. blow hard has to say in regards to their “environmental” policies. They flipped off the Kyoto (sham) years ago, and they ain’t changed their minds. Besides they have all the money!
wmbz:
China and India do not have all the money; we do. If you doubt this, then I invite you to visit either country and see the way they live there. It’s not like it is here. You can even look on the inter-web and get pictures. Also, they are polluting more than we are becuase they are doing most of our production in exchange for most of our dollars, something that most of our people are a bit fed up with. That gives us an awful lot of negotiating power, no?
“China and India do not have all the money; we do”.
Really? Well if you consider all the debt all the money, then you are correct, other wise you have it bassackwards.
Thanks, wmbz. That was real mature of you.
If I owe a man $10000 he may be in the drivers seat
If I owe him $12,000,000,000,000,000 the car is flying down the road at 200mph, the windows are blacked out and the brakes aren’t working.
Who cares what China and India do? Someone’s gotta go first. Yes, it would be fine and dandy if China and India took some small measures to cap thier pollution, but if we want to be Leaders again, we have to Lead..
Or we could spend the next decade going ‘but…but…its not fair - they’re not doing anything, so why should we?
Yes, the bill has more holes in it than Swiss Cheese, but its a start in the right direction. To misquote The Prez - I’m happy not to squash the Good in favour of the Perfect.
This saying comes to mind -
- The early bird gets the worm, but the second mouse gets the cheese.
We are the first mouse in this scenario. I don’t want to be the first mouse. Why sacrifice our own economy so that another country can benefit?
I’m not saying don’t act and enforce environmental measures. I would propose that we allow no imports that don’t meet the same requirements as we put for ourselves - period.
Otherwise we’re pissing into the wind - and making the overall earth’s environment worse by forcing production into countries that have lenient or non-existing environmental laws.
Packman:
You do realize that we are in charge of our own trade agreements, right? There’s no reason we can’t do exactly what you’re proposing.
That’s backdoor “protectionism.” Might not be a bad idea, but try to get it through Congress.
Agree with you packman - it would also be an under-the-counter way of getting China and India to go some way to looking to their own methods of production.
Though, oxide has a point - any hint of protectionsim is going to cause bellows of protest.
Anyway, this whole conversation is making my head hurt- I’m going to go to my favourite yarn stores’ ‘cash only, going out of business due to the recession’ blowout sale to get some yarn to make another wedding blanket for upcoming nuptuals in september. Maybe if people stopped getting married, I could actually use the time to make and sell stuff, rather than doing it for free…
Cable news seems to have misplaced all other news other than MJ karking it, and I don’t think I can stand another repeat of “Thriler”….
That’s backdoor “protectionism.” Might not be a bad idea, but try to get it through Congress.
Yep - that’s exactly why we don’t do it.
This to me shows that environmentalists either:
A) Just don’t think about things like this - that are immensely important, or
B) Are really only interested in saving the environment when it doesn’t conflict with their interest of getting paid by whoever.
P.S. the same principle applies to human rights, including such things as minimum wage etc. E.g. people who advocate minimum wage somehow conveniently ignore the fact that 99% of our stuff is now made by people who make far less than minimum wage. Oh and we get extensive product safety issues and a wrecked economy to boot.
Free trade starts with a level playing field.
Many of you otherwise learned folks just don’t get Chindia, sorry.
Several years ago when I was a grad student fresh from Chindia, I used to help classmates buy used cars. I would call a number and the conversation would go like this:
Me:…so could you tell me about your car
Seller:…well you see it’s red, has a stereo….and I want 2500 for it
Me:…how many miles a gallon?
Seller:…hmm don’t know, let’s see… maybe 20 or 30, not sure, but it’s a great car…
A few days ago cnnfn had a feature on cars and guess what, the two numbers listed there were price and mpg. How things have changed!
Take Iraq
Great if you are Blackwater or Exxon ect
Not so good if you are one of the 1000’s who have died, the 10’s or thousands who have been insured, or the 100’s of thousands who have had their lives changed for ever. Not so good for J6P who will eventually pay for the war with taxes and inflation.
I’ve mentioned the condo building next door several times recently, where one duplex unit is now on the market for the wishin’ price of $580K.
Well, not only has the unit not generated much market interest (surprise), but the entire building — built in 2005, mind you — is being re-tuckpointed and having some other deficient masonry work corrected. I wonder how much that’ll set the condo association back?
My sweetie got talking to one of the masons this week, and he gave her an earful about how poorly constructed the condo building is. This building is part of the better-built construction in the area, too, since the code requirements to build on a “historic boulevard” such as ours (part of a series of parks and connecting boulevards designed in the 1870s) are stiffer than just any ol’ residential street …
To make a long story short, even a lot of the allegedly good construction from the boom era is riddled with issues.
is being re-tuckpointed and having some other deficient masonry work corrected. I wonder how much that’ll set the condo association back?
A lot.
My dad started out as a masonry contractor, his bread and butter was fixing others’ botched jobs. I hope a couple of the guys he trained are still around when it’s time for me to buy a house, I wouldn’t go to closing without having an experienced eye inspect the place. Especially the foundation.
ET, I’m curious about any more details you have on what the original masons did wrong. Was it the wrong type of mortar, or wrongly applied, or what? Was it illegal immigrants doing the work? Are the original contractors still around and has anyone complained to them?
I’m not sure what the original masons did wrong, but I’d guess the mortar was incorrectly applied or set. They are routing out at least some of the original mortar (I can’t tell how far, exactly, maybe .5-.75 inch) and reapplying to the entire building, brick by brick — seems like more than just a simple tuckpointing/repointing. In addition, they’re doing some stuff around the top that may be cosmetic, or may also be fixing defective mortar.
The skilled crews around here are typically either union guys or small operations (often former Eastern Bloc immigrants) that know their stuff. On the lesser crews, it seems like anything goes, and there could have easily been illegal aliens or unskilled workers on-site.
As far as going after the contractor, the possibilities include A.) an outfit that goes out of business and promptly re-opens under a new name; B.) a contractor that operated under a shell company’s name; and C.) a situation made more complex by city and/or private inspectors who signed off on the building without actually, you know, inspecting it properly. All three things happen around here somewhat regularly, and unless one has a savvy attorney or ace-in-the-hole, it can be difficult to recoup money lost on defective.
When I owned a condo a few blocks away, our ace-in-the-hole was that the developer (who was related to the primary contractor) kept a unit in the building as a rental property — when we found defective work, we threatened him with a lien (I believe we only filed a lien once, but threatened several times). That particular building wasn’t too bad construction-wise, but then again, it was a rehab of an eight-flat built in the ’20s. The developer finally got smart and sold his unit, but by then, I was selling, too …
With all due respect to your dad……..
My experience has been that construction industry contractors are just like dentists/orthodontists. Any work that you have had done previously is crap, that all needs to be redone to the new guy’s standards.
When I went to my current dentist for the first time, he wanted to schedule about $10K worth of rework to my mouth (including putting me in braces……..I was 44 at the time). Told him we’ll review the situation as problems come up……..
9 years later……..he missed out on the chance to “Pimp my Mouth”
My experience has been that construction industry contractors are just like dentists/orthodontists. Any work that you have had done previously is crap, that all needs to be redone to the new guy’s standards.
Wow. An old dentist of mine even warned me about that. The last bit of advice he gave me before he retired was, “Some dentists will tell you to have all your old work replaced by new work. If it’s not causing a problem, it doesn’t need to be replaced.”
With all due respect to your dad……..
Not my dad!
X-Philly’s dad?
While I’m not a mason, I’ve done my fair share of remodeling.
The most common problem with masonry is usually bad mortar.
Years ago, my parents had to have their chimney re-done because the brick itself was so crappy. Heck, covering over low quality brick was why formstone became so popular in Baltimore.
Ah, Baltimorgue - low-quality is part of the way things are done here!
China Should Buy Gold to Hedge Dollar Fall, Along With Land In The U.S. By: Reuters | 25 Jun 2009 |
China should buy more gold because the U.S. dollar is poised for a fall and the metal is needed to support the greater international role envisaged for the yuan, a senior researcher with the ruling Communist Party said on Thursday.
Li Lianzhong, who heads the economic department of the Party’s policy research office, said China should use more of its $1.95 trillion in foreign exchange reserves to buy energy and natural resource assets.
Speaking at a foreign exchange and gold forum, Li also said that buying land in the United States was a better option for China than buying U.S. Treasury securities.
“Should we buy gold or U.S. Treasurys?” Li asked. “The U.S. is printing dollars on a massive scale, and in view of that trend, according to the laws of economics, there is no doubt that the dollar will fall. So gold should be a better choice.”
There is no suggestion that Li, even though he is a senior researcher, was enunciating an agreed party line.
However, a debate is swirling in China about how the country can reduce its exposure to the dollar and to U.S. assets in case America’s ultra-loose fiscal and monetary policy rekindles inflation and erodes the value of the dollar and U.S. Treasuries.
To that end, China has said it will buy up to $50 billion worth of bonds denominated in Special Drawing Rights, the International Monetary Fund’s unit of account, to be issued by the IMF.
“…Along With Land In The U.S.”
Didn’t the Japanese try that in the early 1990s? How’d it work out for them?
Exactly. Unless there is oil or coal under that land… China shouldn’t touch it… wait… cap&tax… Hmmm…
Got Popcorn?
Neil
It’s interesting Neil. If you look at the chart on your blog that you made quite a while ago, you find that capitulation would correspond with July/09. With the emotions running together, it is too hurrying of the process. Thanks for the update on your blog. I can feel the change in the wind towards capitulation myself here in the SGV.
Don’t forget, some of the wealthier Arab countries were buying up US land and companies.
Anyone know what supports the value of those IMF Special Drawing Rights bonds? My guess would be loans to impoverished 3rd world countries. But I’m usually wrong.
Secondly, if China doesn’t buy our Treasuries, how do we afford their manufactured products? Are they willing to trade increased unemployment for IMF SDRs? I call BS on them.
Bingo!
Also, whom are they going to buy the gold from anyways? Themselves? FYI, China has been the world’s biggest producer of gold since 2006.
Right Jon.
It won’t be long until China gets to rejoin the long list of countries who spend most of their time complaining about how doing business with the United States is so unfair.
“and will do nothing the global warming alarmists think it will.”
Again (and again and again), just because you disagree with the mitigation strategy (cap and trade, carbon tax, etc.) doesn’t mean that the science is false and that we are alarmists. Try harder not to confuse the two.
Global mean temperature is 1) increasing and that increase is 2) most likely due to anthropogenic GHG sources.
MrBubble
In my heart of hearts, I know that there’s nothing we can do to stop human caused global warming. Most of us are pretty much f****d. “When the world is running down, you make the best of what’s still around.”
“When the world is running down, you make the best of what’s still around.”
Ah, Sting, I remember the days when you didn’t make me cringe.
(Nice summation in the non-Zenyatta Mondatta portion of your post as well.)
“just because you disagree with the mitigation strategy (cap and trade, carbon tax, etc.) doesn’t mean that the science is false and that we are alarmists. Try harder not to confuse the two.”
I’m not confusing anything. I disagree with BOTH the claim that temperatures are rising at a significant rate and the claim that the mitigation strategy would do anything about it if they were.
Then you are pretty much an idiot. How much evidence do you need? Been to Glacier Bay recently? Been hiking in the high Sierras recently. Look around you man.
Just as some people really WANT TO BELIEVE that cold fusion was a supply of endless energy, some people really WANT TO BELIEVE that Earth isn’t getting warmer.
So, the searing logic of your obviously genius like conclusions boils down to “if you disagree with me, you’re an idiot”?
+10
That’s always the smart ass response. In fact one jackass “meteorologist” on the weather channel, can’t remember her name( Heiny something) wanted those that disagreed with the global warming scam,to have their credentials pulled. Great open minded group! As their supreme leader instructed, the debate is closed! LOL!
I am a software engineer. Not a climatologist. My understanding of the situation is that essentially all of the folks who have the credentials to weigh in on the subject agree that the planet is warming. However, there is somewhat less agreement that humans are the cause of the warming and even less agreement that we can do anything to stop it if we are.
However, when I say “less agreement” I still understand that we are talking about the vast majority of scientists in this area. I also understand that no one has been able to generate a test that shows that the theory of human caused global warming is false.
Given the above, I have to make a decision on whom to trust on this issue. The vast majority of scientists in this area? Or a bunch of guys on various blogs, and various scientists who work for petroleum companies?
My trust will go to the former. Though I will maintain a healthy amount of skepticism and look forward to those scientists with opposing views finding testable theories that might lead to other conclusions.
In the meantime, I am willing to pay higher costs in order to hopefully mitigate the consequences if the current theories are true. I understand that 6 billion human beings have never lived on this planet when it is this hot, and getting hotter. It is possible that at higher temperatures the planet cannot support that population. I would not want to be in the non-supported category.
Good thing you’re just a software engineer.
I cringe at the notion that someone accepts something as true unless it is proven false. That’s what passes as “fact” these days? Funny - the thinking process deemed unacceptable to the typical liberal (Bush and WMDs) now is totally acceptable because it fits their view of the world.
Used car salesmen adore people with that sort of rationalization process. As do politicians.
For the record, the creator of The Weather Channel - John Coleman - believes global warming to be a fraud.
OK, LehighValleyGuy:
If you disagree that temperatures are rising at a significant rate, then I suggest you start looking into your own credentials. How much science training do you have?
“If you disagree that temperatures are rising at a significant rate, then I suggest you start looking into your own credentials”.
So you can prove that they are? Wow, and what are your credentials?
I have a science degree. I saw the data when I took physical geography. Then I saw some more data when I took ecology. Then I saw some more data later when I read a paper. And another paper.
There is a scientific consensus on this one.
“There is a scientific consensus on this one”.
The jury is still out, but nice try.
Sorry wmbz - pretty much the whole scientific community is in agreement about Climate Change.
I have no idea what ‘jury’ you’re referring to. You may not be a ‘believer’ but like religion, that’s a matter of faith, not science.
Put it this way - all that coal, oil and natural gas is nature’s ‘carbon sequestration’. The planet’s really good at scrubbing carbon and greenhouse gasses out of the environment and locking it away - in the sea bed, in coal seams, in oil and gas fields, etc.
Left to it own devices, all that stored energy is inert.
So what humans have been doing for the last 150 years or so is extracting all that ’sunny day in the Carboniferous Era’ energy out of its hidey holes and reinfusing it back into the atmosphere and environment.
Its an addition to the planet’s current carbon/greenhouse gas level - because if we hadn’t pulled it out of the ground and burnt it, it would have stayed there.
So, yeah, to a certain extent its a man-made problem - there’s many hypotheses on how much it affects the atmosphere, but there’s little doubt that it is having an effect.
From Wikipedia:
Scientific consensus
A question which frequently arises in popular discussion of climate change is whether there is a scientific consensus. Several scientific organizations have explicitly used the term “consensus” in their statements:
American Association for the Advancement of Science, 2006: “The conclusions in this statement reflect the scientific consensus represented by, for example, the Intergovernmental Panel on Climate Change, and the Joint National Academies’ statement.”[25]
US National Academy of Science: “In the judgment of most climate scientists, Earth’s warming in recent decades has been caused primarily by human activities that have increased the amount of greenhouse gases in the atmosphere. … On climate change, [the National Academies’ reports] have assessed consensus findings on the science…”[76]
Joint Science Academies’ statement, 2005: “We recognise the international scientific consensus of the Intergovernmental Panel on Climate Change (IPCC).”[77]
Joint Science Academies’ statement, 2001: “The work of the Intergovernmental Panel on Climate Change (IPCC) represents the consensus of the international scientific community on climate change science. We recognise IPCC as the world’s most reliable source of information on climate change and its causes, and we endorse its method of achieving this consensus.”[78]
American Meteorological Society, 2003: “The nature of science is such that there is rarely total agreement among scientists. Individual scientific statements and papers—the validity of some of which has yet to be assessed adequately—can be exploited in the policy debate and can leave the impression that the scientific community is sharply divided on issues where there is, in reality, a strong scientific consensus…. IPCC assessment reports are prepared at approximately five-year intervals by a large international group of experts who represent the broad range of expertise and perspectives relevant to the issues. The reports strive to reflect a consensus evaluation of the results of the full body of peer-reviewed research…. They provide an analysis of what is known and not known, the degree of consensus, and some indication of the degree of confidence that can be placed on the various statements and conclusions.”[79]
Network of African Science Academies: “A consensus, based on current evidence, now exists within the global scientific community that human activities are the main source of climate change and that the burning of fossil fuels is largely responsible for driving this change.” [22]
International Union for Quaternary Research, 2008: “INQUA recognizes the international scientific consensus of the Intergovernmental Panel on Climate Change (IPCC).”[80]
Australian Coral Reef Society, 2006: “There is almost total consensus among experts that the earth’s climate is changing as a result of the build-up of greenhouse gases…. There is broad scientific consensus that coral reefs are heavily affected by the activities of man and there are significant global influences that can make reefs more vulnerable such as global warming….”[81]
“Since I am no longer affiliated with any organization nor receiving any funding, I can speak quite frankly … . As a scientist I remain skeptical.” — Joanne Simpson, the first woman in the world to receive a Ph.D. in meteorology.
What? She can’t say that!
The debate is closed, or so says someone without ANY credentials and a mammoth ‘carbon’ foot print.
Since the human animal is carbon based, and we inhale and exhale wouldn’t it reduce the evil CO2 if we stopped exhaling?
Just a curosity question, how much does mother nature herself play into the global warming?
I’ve noticed there has been alot of volcanic activity going on. Can this contribute?
Depends on what is being spewed. I wouldn’t be surprised if some volcanic eruptions involve green house gasses. Very large eruptions of particulates tend to block out the sun and provide temporary cooling.
Google “the year without a summer.”
Since the climate scientists are geologists, I promise you that they take into account volcanic activity when they do their calculations.
What exactly are the implications for respiking operations of having a turd in the punchbowl?
Wall Street Journal
* JUNE 26, 2009
Bernanke Blasted in House
Political Heat Mounts on Fed as Grilling Over BofA Shows Ire at Its Interventions
By MICHAEL R. CRITTENDEN and JON HILSENRATH
…
Rep. Darrell Issa, (R., Calif.), said documents subpoenaed by the committee show government officials did make threats against Mr. Lewis. He said there have been conflicting statements made under oath about what transpired.
“I question the appropriateness of their actions and the wisdom of their judgment,” Mr. Issa said, referring to Mr. Bernanke and then Treasury Secretary Henry Paulson, who will testify in front of the committee next month. Mr. Towns said he also wants to hear from the Securities and Exchange Commission and the Federal Deposit Insurance Corp.
The reams of documents gathered by the committee offer a rare glimpse inside the government’s decision making at the height of the financial crisis. At one point, according to handwritten notes taken by an unnamed Fed official, Mr. Paulson refers to Bank of America as “the turd in the punchbowl.” The notes were taken during a conference call in early January among top U.S. officials to discuss the government’s rescue package.
A spokeswoman for Mr. Paulson didn’t respond to requests to comment.
…
Got to love the context of the statement “… at the height of the financial crisis…” like it is history. That was round one in a 12 round brawl. Or wait, did we get KO’d?
It is funny how everyone says rising home prices indicate the CA recovery is underway, as I just heard a report that said unemployment is headed north of 12 pct and will remain at double-digit levels for several more years. Moreover, the CA state govt is planning to issue IOUs because it has no money to pay its workers. It is pretty hard to envision a housing price rebound under such conditions.
It is also hard to distinguish real signs of recovery from the superficial spike in home prices that would naturally occur due to massive interventions that hand buyers free money (aka tax credits) if they buy a home, and banks holding shadow inventory off the market in the hopes of catching a future wave of home price inflation.
* The Wall Street Journal
* REAL ESTATE
* JUNE 26, 2009
Home Prices Rise in California Again
By STU WOO
SAN FRANCISCO — California’s median price for an existing single-family house rose for the third straight month, a sign that the state’s battered real-estate market may be bottoming out.
The median sales price increased to $267,570 in May for a California home, an increase of 4.2% from April, according to a report released Thursday by the California Association of Realtors. The inventory of unsold houses continued to drop, to 4.2 months’ supply in May compared with 4.6 months in April and 8.7 months in May 2008. Prices were still well below their year-ago levels, down 30.4% compared with May 2008.
One explanation for the increase in housing prices is that fewer foreclosed properties are among those being sold, said Kirk Lesh, an economist for California Lutheran University’s Center for Economic Research and Forecasting. Banks tend to sell foreclosed houses at lower prices than do people selling their own homes.
California’s real-estate market, the nation’s largest, is seen as a barometer of the U.S. economy. Housing prices soared during the boom, and their plummet during the market’s collapse resulted in massive foreclosures and fueled the recession. Economists say the state’s housing market will lag behind the nation’s in recovering, so any indication of improvement in California bodes well for the rest of the U.S.
With Thursday’s report, real-estate experts said they were a bit more optimistic that the California market is healing. But they warned that the state’s 11.5% unemployment rate could result in more foreclosures and drive down real-estate prices again, as could lawmakers’ plan to slash more than $10 billion from state spending to close a $24 billion deficit.
…
…superficial spike in home prices…
Yep.
This is yet another example of why using just the median
price as a sole gage is flawed. The median *would* be
meaningful *if* the statistical distribution was
even across all price ranges. But, as we all know, it isn’t.
So, what to do? Lots of debate, but personally I track
median, mean, and $/sqft for the areas I am interested in.
Not perfect by any stretch of the imagination, but enough
to get a rough estimate, particuarly when I happen to
be very familar with the neighborhoods I track. (Irvine ,Ca)
Be very interested in how fellow bloggers track price trends.
Any metrics out there that make more sense?
ISTR that Shiller uses chained sales, but the problem with THAT is that new homes are a different mix than existing homes.
Why is that a problem?
The best representation - by far - is same-house sales, which is what Case/Shiller does. New home prices (a component of median numbers) skew the real value changes, for several reasons - mix, size, etc.
I suppose the answer you rely on depends on the question you want to answer. If you are interested in how the (quality-adjusted) market value of existing houses is changing over time, then new homes don’t belong in the sample, as by virtue of being new, their market values could not have changed yet. However, there are methods that could accommodate new homes in the sample (e.g. hedonic price indexes) which might better reflect the whole market than does the Case-Shiller/S&P 500 Index, which by construction, only samples existing homes (and of those, homes which have sold twice over the sampling period). If there is something fundamentally different about the sales transactions which are left out of the Case-Shiller sample frame compared to those included, then their index might produce a biased measure of the entire U.S. housing market.
I can’t think of a single reason to include new-home sales, other than possibly just to have a larger sample size in some podunk town that only has 100 houses.
The value of new homes is implied by the value deltas of existing home sales.
e.g. Home A is new in 2007 and bought for $X, and then sold in 2009 for $Y.
Similar new home B was built in 2007, original asking price was $X but it never sold. Its value is now $Y, based upon the resale value of home A.
Same for things like estimating “underwaterness” of mortgages (e.g. to make a decision whether to mail in the keys or not). If you a house that was built in 2005, and want to know if you’re underwater - you don’t care about the prices that new houses are going for now - you care about direct comparisons - i.e. the price decline of sales in 2005 vs. houses sold now. If the mix has changed, causing the median to rise or fall - that’s irrelevant, because your home size has not changed.
FWIW - one reason to use median data (including new homes) is just because there isn’t any existing published data on resales. Actually this is true for CA as a whole - Case/Shiller doesn’t publish that. However that doesn’t validate the CAR data. The CAR data at at least *some* data whereas otherwise there wouldn’t be any. Though even in CA’s case I think the sum of the FHFA data for the CA metropolitan areas (similar method to C/S, but more complete) would be better.
Why would anyone in their right mind buy a house in California right now?
Until the dust settles in Sacramento people who buy a house in California are just crazy, just plain crazy.
I love it. The US can party again because CA median house prices are up m-o-m in June.
Hmm. So the newly unemployed will buy those STILL overpriced homes… how, exactly?
I guess there are psychological reasons why I’m slowly buying up very used copies of books I enjoyed in my younger days and re-reading them. Last night, my nice used library copy of “The Story of Sir Launcelot and His Companions” by Howard Pyle arrived, and I spent most of the evening rereading it. I didn’t have to hear about Michael Jackson, Farah Fawcett, the economy, the auto industry (boy am I sick of that around here), more layoffs ( I keep thinking about those poor families ), etc. My husband fell asleep early, and it was just me, a nice summer’s eve after some massive thunderstorms, and the gallant knights and noble ladies. I had a ball.
When I am in an intellectual rut at work and I just can’t think straight, I’ll spend a few days with no TV, no newspapers and no scientific reading. I’ll just plow through about 3-4 books (classics and contemporary). Afterward, my brain is at its clearest and my productivity goes way up. I started doing this when writing scientific papers and it’s truly amazing how well it works.
I’m totally disturbed by the shear volume of people that cannot put Jacko’s creepiness before his stardom. I mean, seriously…
I know. I don’t understand why the headlines don’t read “Children under 12 rejoice! Ding dong, the witch is dead!”
Because one doesn’t need to have monolithic opinions on a subject.
One can love Wagner’s music and deplore his views at the same time. They are not related.
One can recognize the genius of Einstein while remembering that he said some pretty asinine things about quantum mechanics.
And so on and so forth …
Whatever the man’s flaws, he definitely had a gift for music.
I don’t think that Einstein’s opinions about quantum mechanics are on quite the same level as Michael Jackson’s molesting little boys. Whom are you kidding ?
If he was so great at music, why didn’t he write “Love Shack?” Huh? Answer me that!
And I’d argue that the media’s attention to his death has been pretty monotonous… loss of a great entertainer… blah blah blah. I guess if Nixon can get a death induced white-wash, so can Michael. (Not that he didn’t try a little white-washing while alive! Take that however you want.)
As to your point, I’m relatively sure the odds of him molesting another kid were higher than the odds of him releasing another hit song, so all in all a net benefit to society.
Am I done being a jerk yet? I am? Okay. Done for now.
What goes “plop, plop, fizz, fizz”?
Twins in an acid bath.
What goes “clop, clop, bang!, bang!”
An Amish drive-by shooting.
“Because one doesn’t need to have monolithic opinions on a subject.”
I know, I hate his music, too.
Hee-hee, hoo-hoo
I liked his music when he was a little black kid singing with his brothers.
You feel bad for anyone Jackson or Fawcett who dies. But it amazes / disgusts me how many people act as though celebrities are gods ! How many of the people moaning and growning at the vigils could tell who Robert Noyce, or Jonas Salk or Marie Currie were ???
Mary Curie.
Oops, lol, Marie of course. The curry association got my brain.
“Marie Currie”
I’m working on that, too
I dunno i search the Perez Hilton website and non of those names came up….are they Americans?
—————————————————–
who Robert Noyce, or Jonas Salk or Marie Currie were ???
Nice!
Also, I’m annoyed that I actually know who Perez Hilton is. Stupid CNN printing that on the front page like it is ‘news’ or something.
Since Michael Jackson was 90% plastic, they are going to melt him down and turn him in to Legos so children can play with him for a change.
And risk getting parts of him stuck in bits of the children? WHY DO YOU WANT TO PERPETUATE THE CYCLE!
Note : I got a lego stuck in my nose as a child. True story. Had to go to the emergency room as my dad couldn’t reach it with the needle-nose pliers.
It was rumored his Nose was high tech plastic and held on with magnets
I’ll bet your dad fixed almost everything with duct tape ! We called my Dad’s plumbing fixes “wrap jobs”.
Electrical tape for my dad. He rewired our entire built-in-1901 house. Then, when it was time to sell we paid an electrician to fix it.
“It was rumored his Nose was high tech plastic and held on with magnets”
This is not a joke, but I wondered if it stayed on through CPR.
I wonder if his whole face did. He was getting pretty crypt-keepery towards the end.
“With Thursday’s report, real-estate experts said they were a bit more optimistic that the California market is healing. But they warned that the state’s 11.5% unemployment rate could result in more foreclosures and drive down real-estate prices again, as could lawmakers’ plan to slash more than $10 billion from state spending to close a $24 billion deficit.”
I love the “cover your ass” in this quote. So which is it… is CA healing or will rising unemployment and foreclosures drive down prices? Hmmm….
Just wait for CA to officially run out of money, issue IOU’s, lay off state workers, reduce services, close parks, etc. Then see how many people want to own a home in this state.
The increased median has everything to do with the mix of houses being sold. This same news can be re-interpreted to indicate the upper end market is getting hammered.
Mr Mortgage warned us back in March that the MSM would pick up on this and twist it to their own advantage.
Yep. With the high end coming down, we’re getting knife-catchers for that segment getting frisky. Price per sq foot is still coming down.
My understanding is that relatively little of the foreclosure activity has to do with job losses, and most have to do with overleverage and ARM resets. It’s only a matter of time before banks realize that they can make more money by writing down the note and sharing in upside with the “owner” above the new basis than by simply foreclosing and dumping the house for even less.
That won’t happen for 3 reasons:
1. The bank doesn’t own the mortgage and the servicer would have to get agreement from multiple investors to modify their agreement. This agreement would probably involve cutting the interest rate to like 1/4 of what it is now, which would be a tough sell at best.
2. They can get more money for the house by selling it now than they can by writing down the note and sharing in upside.
a. What upside?
b. Prices haven’t hit bottom yet. That’s because they’re still unaffordable. If they cut the note to a payment on par with today’s prices, then the payment will still be unaffordable, and the current owner will still probably default. The bank needs a new buyer with a higher income.
3. They would have to get the new owner to agree. What is the benefit of owning the house if you can’t get your upside and renting is cheaper?
Federal Reserve chair utilizes financial terrorism while rebuking attempt by Ron Paul, Congress to hold the independent organization accountable
Aaron Dykes
Infowars
June 26, 2009
Federal Reserve chairman Ben Bernanke unleashed an alarming veiled threat of financial terrorism when he was questioned by Rep. Duncan on Thursday about his response to the fact that a majority of Congress co-sponsoring Ron Paul’s H.R. 1207 bill to audit the Federal Reserve.
Bernanke clearly regarded the bill’s intent as hostile to the institution he represents:
“My concern about the legislation is that if the GAO is auditing not only the operational aspects of the programs and the details of the programs but making judgments about our policy decisions would effectively be a takeover of policy by the Congress and a repudiation of the Federal Reserve would be highly destructive to the stability of the financial system, the Dollar and our national economic situation.”
The brunt of Bernanke’s statement is as crystal clear as a threat from a common street thug– back off from the Fed, or the economy gets it.
The chairman clearly implies that any attempt to restore monetary powers constitutionally granted to the Congress would be seen as a “takeover” and that the defensive and “repudiated” Fed would respond destructively.
Of course Congress’ constitutional power over money is enumerated in Article I, Section 8 of the U.S. Constitution:
The Congress shall have power… To coin money, regulate the value thereof, and of foreign coin, and fix the standard of weights and measures;
Bernanke’s open use of financial terrorism in the face of Congress’ blatant Constitutional authority is absurd and dispicable.
Greenspan, Bernanke and other Fed-related cronies have already bad-mouthed the Dollar and signaled it’s decline as the world’s currency. So what else is new?
The idea to audit the Fed is but a glimmer of hope for this country. Afterall it’s Congress’ wreckless spending that got us to this point. Do you expect the spending to stop. In my mind auditing the Fed is the same as a dope addict blaming his dealer.
The FED has hired a lobbyist to work against the push for an audit. She once worked for Enron, perfect match.
Dilbert is pertinent to the HB today.
Yep, so true!
Let’s hear it for Asok - he must be on this Blog somewhere!
Dilbert 26 June 2009
Panel 1:
FB coworker to Dilbert & Asok the intern: “I can’t afford my mortgage because of my pay cut. The bank will take my house.
Panel 2:
Asok the intern: “I saved a bundle by being a renter. I should buy your house for next to nothing.”
FB coworker eyes bug out in silence.
Panel 3:
FB coworker glowers at Asok.
Asok the intern peering at FB over the edge of his coffee cup: “Too soon?”
Tee hee.
Panel 4:
FB gets fired and Asok takes his job for 70% of his pay. That’s OK though because Asok just bought FB’s house for 40% of what FB paid for it, so Asok is doing fine.
In subsequent episodes:
FB starts up competitor company with the secret personal goal of destroying Asok. A new Dilbert soap opera is born. Everyone loves it.
ROTFLMAO
I love Asok’s final quip, “Too soon?”
Ahh… renter’s rejoice!
Ok, must tone down schadenfreude…
But its ok, if its in Dilbert, right?
Got Popcorn?
Neil
I am writing like crazy today for my thesis/practicum. My project is bubble-related as I am investigating high school retention/dropout rates — a disproportionate number of subgroups in our school’s leave/dropout due to lack of opportunity. It’s a “duh!” study, but what the frick, I gotta examine something…
Exam schools in NM. 60% drop out rate in high school. Who is the gov there?
Muggy Muggy Muggy…….I’m surprised ay you.
90% of the inmates speak ghetto not English,
How many jobs require ghetto as the language?
That is the answer to your thesis.
DJ, if I asked you who you thought has a higher rate of absenteeism at the school (FL,low income), Hispanics or whites, what would be your answer?
Whites.
Its the language not the color or race…you people always ask the wrong questions.
I would say whites because white people never get a bi-lingual education in southern drawl or geechee they are forced to learn English..
once you frame questions around English skills you get a whole different set of answers.
Its also true that people with 4 years of college are incarcerated or arrested equally. No discrimination there.
So to end all the nonsense we need a a boot camp for low income people to read write and speak English, then opportunities will preset itself.
The absenteeism rates are the same.
Then frame your questions around English skills. How many of these low income people can speak or argue without using any 4 letter words?
Proper communication skills have been neglected in our schools and of course in our music.
I really don’t think MJ would be too successful today, because he was not ghetto.
Hey Shwaty i got the peterone and my 2 step it’s on and im getting hot in here, so come ride with me and smell the herbs.
“Father’s philosophy was that if you could n’t swim, you sank, that this was nature’s way, and to meddle with it could only bring trouble. His thinking was this bill (Banking Act of 1933) amounted to the valid objection that if bankers knew they were going to get bailed out should they get into difficulties, it would make them careless in their lending policy and sloppy about investigating the creditworthingnesss of their customers, a veiwpoint surely reinforced by the current Savings and Loan debacle”
- -Reflections in A Silver Spoon (1992) by Paul Mellon.
Mellon’s father, Andrew Mellon, was Secretary of Treasury for 10 years but left upon FDR’s election. A. Mellon also gifted the National Gallery of Art to the country. Book not about finance but autobion of Paul who did not go into family banking busines but spent life on philanthopy, art, and horses.
Just one more lowlife political crook, lets see if she gets 5 years. Ain’t gonna happen
FEDERAL SYNAGRO PROBE
Monica Conyers pleads guilty to conspiracy
She faces up to 5 years in prison
Free Press Staff Writers • June 26, 2009 Updated at 12:05 p.m.
Detroit City Council President Pro Tem Monica Conyers pleaded guilty this morning to conspiring to commit bribery and is free on personal bond.
U.S. District Judge Avern Cohn said, “The defendant now stands convicted.”
The one count of conspiring to commit bribery is punishable by up to five years in prison.No sentencing date has been set.
Conyers, the wife of powerful Democratic congressman U.S. Rep. John Conyers, appeared before Cohn to answer charges in connection with the wide-ranging probe of wrongdoing at Detroit city hall.
She has long been under suspicion in the Synagro Technologies bribery probe, not least because she had been a vocal opponent of the contract before suddenly switching her sentiments. She became the deciding voice in the city council’s 5-4 vote to approve the sludge-hauling deal in November 2007.
Speaking of Detroit, where’s Blano been a-hidin’?
Last I heard he is involved in the GM bankruptcy in some way (not sure which way but just involved…).
She will roll over on (former) Mayor Kilpatrick and give tons of evidence against him. Thus, her sweet plea deal today.
More ‘green shoots” nah… Brown squirts.
Charlotte area jobless rate jumps to 12%
Charlotte Observer
Friday, Jun. 26, 2009
Charlotte-area unemployment jumped in May to 12 percent, the highest of the recession, as companies continued to hold off on hiring and the labor force began swelling for the summer.
Nearly 102,000 area residents were unemployed last month, according to data released this morning by the N.C. Employment Security Commission. Both the number of unemployed workers and the May jobless rate – up from 5.8 percent in May 2008 and 11.3 percent in April – were record highs for a recession that is midway through its second year.
While the region’s labor force grew by about 800 from April to May, the number of people with jobs fell by more than 4,300 to about 751,000.
Mecklenburg County unemployment increased from 10.2 percent to 11 percent, and jobless rates increased in most other area counties:
Yesterday was a pretty bad day as far as I’m concerned. I had that iconic Farrah poster on my wall growing up, so it was sad to see her go. But losing Michael was a shock. The first concert I ever attended was the Jackson 5, in 1972. I was 9. I remember them introducing Michael on stage. I was thinking…oh here’s the little brother. How cool. But then he just took over the show, and I mean took over. It was an amazing display of talent. He could sing and dance so good, and he knew how to work the audience. This was a kid? It was very memorable. Also, this was Cleveland, and the place was probably 50/50 black/white. I don’t think I had ever been to an event like that with so many colored people. But I left that concert being less afraid or threatened by black people, realizing that they were cool, and friendly, just like white people were.
The Jackson 5, and Michael introduced white people to black people, and brought down a lot of fears white people had for blacks. I never looked at black people the same way again.
He was definitely one of a kind. So was Farrah. They were both icons for me when I was growing up. I’ll miss them both.
After entering the Pearly Gates, St Peter welcomed Farrah and told her she could have one wish granted for her long suffering. Without hesitation she wished that all the children in the world would be safe and back on earth at that very moment Michael Jackson dropped dead.
Ho ho ho - that’s quite droll, Muddyfoot. I agree.
Do you have any proof he did anything? I believe he was acquitted. Again, attacking a dead person is low class.
You must be Republican.
I resent that you imply only republicans can enjoy dark humor.
Also, being dead shouldn’t give you a pass. Otherwise we should all be polite to Adolf. After all, he DID give us the VW Bug. How bad could he be?
So now we are comparing Michael Jackson to Hitler? What are you on? It must be pretty powerful.
BTW, admit it. You ARE a Republican, right? You guys are haters. Period.
Perhaps you never owned a bug
Gavin stayed at Neverland with his family’s blessing and spoke on camera of occasions when he has shared a bedroom with Jackson.
When Bashir put to Jackson that many people would think it inappropriate for a 44-year-old man to share a bed with a young boy, Jackson dismissed them as “ignorant” and “wacky”.
“Why can’t you share your bed? The most loving thing to do is to share your bed with someone. It’s a beautiful thing. It’s very right, it’s very loving. Because what’s wrong with sharing a love?” He added.
I saw him say this on camera years ago and again last night.
IMHO a 44 year old man who shares a bed with a young boy doesn`t qualify for low class.
I must be a FATHER.
banana,
I couldn’t help but think ( and every ‘other’ song on WLS in Chicago was a J-5 tune at the time ) that perhaps this is a case where jail time could have saved his life?
Very preliminary but his former atty. said his “handlers” wouldn’t say no to him and he’d been quiet about it too long. Actually my favorite cross-over artist was Little Richard ( Good GOLLY! ) and later Jimi Hendrix ( no doubt ) but Michael appealed to a ‘much’ broader audience.
However, as the session wore on, Little Richard’s anarchic performance style was not being fully captured on tape. In frustration during a lunch break, he started pounding a piano and singing a ribald song which he had been performing live for some time.[4] The song that he sang was a piece of music that he “had polished in gay clubs across the South”.[5]
Although the song was essentially his own, it bears some similarities to an earlier song “Tutti Frutti”, recorded by Slim and Slam in 1938.[2] Little Richard sang :
“A wop bop a loo mop, a good goddam!
Tutti Frutti, good booty
If it don’t fit, don’t force it
You can grease it, make it easy.”
After this lively performance, Blackwell knew the song was going to be a hit, but recognized that the song, with its “minstrel modes and homosexuality humor”, needed to be cleaned up.[5]
I was really bummed out about Jackson too. We already knew Farah was dying, but I hadn’t even considered what I would do if Mike went.
Yeah Big V, it’s a massive shock. It was very hard to see what MJ had become, but I still have very fond memories of the early years, and the positive influence he had on my life.
Can’t take that away from him.
Ya, sure Jackson was one of a kind! he was a pedophile…period. A black man trying to look like a white Diana Ross. He was no role model nor any idol, just a pervert. I cant belive the insanity of thinking a guy like this was worth anything.
Well he was the only person that I know of that was born a lovely black child, and grew up to be a white women! Never heard of that before.
To attack someone after their death is about as low class as you can get.
To deify somebody after they’re dead is just dumb and a disservice to everyone.
To attack helpless children while they’re alive is as low as you can get.
+
Last I checked he was acquitted. Do you have other information you’d like to share with us?
Gavin stayed at Neverland with his family’s blessing and spoke on camera of occasions when he has shared a bedroom with Jackson.
When Bashir put to Jackson that many people would think it inappropriate for a 44-year-old man to share a bed with a young boy, Jackson dismissed them as “ignorant” and “wacky”.
“Why can’t you share your bed? The most loving thing to do is to share your bed with someone. It’s a beautiful thing. It’s very right, it’s very loving. Because what’s wrong with sharing a love?” He added.
That doesn’t make him a pedo.
Well, would you let your brother, son, or young cousing sleep in his bed ? I doubt it.
sorry - cousing = cousin. Long week, and more to come tomorrow.
Again he was never found guilty of anything. Honestly, I think years of abuse growing up and being the super star he was left him as a child. There is a good chance he really did like children, and not in the wrong way.
He was different, but I refuse to attack the guy the day after he died. I wouldn’t let my kid sleep in your bed either. What is your point?
It’s pretty well known that he bought off the first kid ( a young teenager ) who was going to file charges against him. Several millions, I believe, were paid. I read online somewhere about the identity of the kid, but years have passed, and I should let sleeping dogs lie. It was a Hollywood industry family, though, and the boy’s father was so devastated by the whole incident that he broke down and was unable to work again.
Plus, Michael had all of the classic marks of a pedophile, and really didn’t see anything wrong with sleeping with young boys - see the “why not share a love” quote referenced above. Pedophiles quite often prey on the poor and single-parented kids, and buy expensive gifts for them. If Neverland wasn’t a paradise for prey, I don’t know what it was.
Money can hush up many criminal lifestyles, and I think he used his for that purpose.
22 million, I believe.
Like that’s a large amount? (hidden smirk)
Yeah, having several million dollars would probably devastate me to the point where I couldn’t work again too
I move to ban all MJ discussions on HBB.
If you throw in Farrah, I second the motion
Can we add in Perez Hilton? And I don’t mean banning the discussion of him, I mean him suddenly croaking.
OK a little Economic /Federal Reserve observance:
NEW YORK (MarketWatch) — Dresdner Kleinwort Securities has withdrawn from the Federal Reserve’s primary U.S. government security dealers, the U.S. central bank said Friday.
The change is net neutral in terms of numbers as a new dealer just came online, but in general this is a major net negative for the Treasury market.
Why? Because being a primary dealer is, in general a license to print money. You get to field customer orders for Treasuries and make your spread, and you have a privileged trading position with The Fed.
There’s only one fly in the ointment, and that is that the position comes with a requirement that you bid. This is distinct from most other nations where no such system exists, and essentially guarantees that there can never be a “failed” Treasury auction.
There was no reason cited for the withdrawal but one can surmise that the issue is that they’re stuffed to the gills with Treasuries and are finding it difficult or impossible to earn their spread, think there is a material safety risk in their participation (e.g. getting stuck long with a deteriorating position), or both.
Either way there is no possible means to read this as bullish. While the issue may be with their liquidity demands and thus not reflect severely on the Treasury market with the issuance that has gone on this year and will for the foreseeable future I wouldn’t take that bet.
The “Chosen” or “Protected” dealers will of course never withdraw but if the changes made to reporting of indirect bid are in fact concealing deteriorating demand and these folks have detected a potential problem in the offing we are fixing to get a severe spanking in our government debt issuance in the near future.
Beware.
(From K. Denninger)
The Happy Few.
Please don’t choke when laughing!
Evidently lots of banks are in no big hurry to unload their shadow REO inventory. They seem to be holding out collective hopes for cargo drops of helicopter money from their man at the Fed.
That doesn’t change the income-rent-price trifecta.
The banks may be bailed out but the houses are still worth only as much as the income that they generate.
LOL - that would be the pinnacle of Schadenfreude for the HBB. Ben should probably make that the banner.
(P.S. I say that as a homeowner even)
+1 on the banner.
US EQUITIES WEEK AHEAD: Madoff Sentencing, June Jobs Report
Friday 06/26/2009 2:15 PM ET - Dow Jones News
By Kathy Shwiff and John Kell
NEW YORK -(Dow Jones)- Bernard Madoff faces up to 150 years in prison at his sentencing Monday for operating a decades-long Ponzi scheme that cost investors billions of dollars.
The national unemployment rate and number of jobs lost in June, to be released Thursday, both are expected to rise from May. Meanwhile, auto makers are seen continuing their string of U.S. sales declines when they release June figures Wednesday.
Markets will have a short week, with some bond markets closing early Thursday and markets, banks, government offices and businesses shut Friday for Independence Day.
Madoff Asks For 12-Year Prison Term
Bernard Madoff, who pleaded guilty earlier this year to 11 criminal counts related to his Ponzi scheme, has asked a federal judge in New York to sentence him to as little as 12 years in prison. The 71-year-old is facing up to 150 years under federal sentencing guidelines.
The court-appointed trustee for Madoff’s firm, Bernard L. Madoff Investment Securities LLC, has identified about 1,341 accountholders at the firm who had estimated losses of more than $13 billion as of Dec. 11, the day he was arrested. Madoff claimed to have nearly $65 billion in his firm’s account at the end of November.
June Jobless Rate Seen Reaching 9.6%
The national unemployment rate is expected to rise to 9.6% in June, with the loss of 370,000 jobs during the month. In May, the jobless rate jumped to 9.4% from 8.9% a month earlier as more people sought employment. However, the May payroll figure showed the number of jobs lost shrank to 345,000, much smaller than losses for the four previous months.
25% Drop Likely In June U.S. Auto Sales
Here’s an idea. Throw this POS, his wife, and his kids all in the slammer for the rest of their lives.
Change I can definitely believe in.
Hyper-deflation?
BusinessWeek elaborates:
“…the inflationary effects of the new money are being fully offset, or more than offset, by the far-reaching and long-lasting impact of household debt repayments. Whether it’s voluntary frugality or under the coercion of creditors, Americans have abruptly switched from living beyond their means to saving more and working down the debts they incurred during the bubble years.”
As Ambrose Evans Pritchard puts it in the Telegraph: “the Fed’s efforts to boost the money supply are barely keeping pace with the deflation shock. Stimulus is not gaining traction. The credit system is broken.”
We’ve argued this repeatedly here.
I think the gold crowd is gonna get a nasty shock. Between the IMF sales and the wholesale default on credit (at just about every level), they’re gonna learn a few things.
FPSS - sans the massive stimulus that’s happening by the government and Fed right now - you would absolutely be right IMO.
But, things being what they are…
(BTW the IMF is selling 403 of the total 158,000 tons of gold in existence, or 0.09%. I don’t think that’ll really do much to the supply/demand equation.)
It doesn’t work like that. Prices are set at the margin.
If someone dumps something like 2x the daily volume of MSFT stock, the stock will have a nasty (temporary) tumble.
The IMF sales will have intermediate-term impact.
LOL.
OK by that logic we should have had hyperdeflation back in early 1982 when the personal savings rate peaked above 12%.
Let’s see… deflation rate in 1982….
(thumbs through files…)
Ah yes!! The rate of deflation in 1982 was… -7.0% (i.e. 7.0% inflation)
Survey says… XXX
Yesterday, we took up the biggest illusion of the Bubble Era. We held it up to the light…and noticed:
So deeply rooted is this illusion that it will take more than a strong wind to uproot it.
We’re talking about the idea that government bureaucrats can do a better job of allocating capital than free markets. Everyone seems to believe it. They’re allowing a handful of economists - who failed the critical test; not one of them noticed the market tsunami coming last autumn - to direct the flow of trillions worth of savings. They’ve already put at risk more than $12 trillion. Right now, they’re denying the need for more ’stimulus,’ but that is likely to change.
$12 trillion is a lot of money. Adjusted for inflation, it is still more than twice as much as America spent in all of WWII. But it’s not just the money…it’s the future of the world economy that is at stake.
In a nutshell, the meddlers believe they can borrow their way out of debt. If you say that the key problem in America is debt, they won’t argue with you. But they think that they can overcome that problem by borrowing trillions more.
Many times have we argued that they will fail. We laugh at building dog walks …bailing out businesses that have lost their way…and paying huge bonuses to Wall Street execs. But those are just the obvious flaws. Down deeper, in the dark, corroded heart of the government economist is a fatal conceit.
We know from the experience of the 20th century that Friedrich Hayek was right. He called it the “Fatal Conceit”: the idea that central planners working for the government are free from sin and error. He wrote early in the century…when National Socialism and Communism were still popular.
Now we know; central economic planning doesn’t work. Everywhere it was tried it was a disaster. The more the bureaucrats planned, the bigger the mess they made. But now we are supposed to believe that central financial planning will save the world from the mistakes of the bubble era. That is the grand illusion waiting to be toppled. What fun it will be to see it come down!
-B.Bonner
The belief that the gov can allocate capital more efficiently than the free market is just as ridiculous as the belief that private industries and the free market can regulate themselves and protect the citizenry better than the government.
The free market should be deciding where to invest, the government should make sure they’re not pillaging the populace while they do it.
“The free market”
When have you ever seen or operated in one?
When have you? Feudalism seems like a far more likely outcome of unrestricted free markets than a utopia.
When have you?
Never.
If you want a truly unregulated market, try a Somali market.
The government’s purpose is well stated in the preamble to the Constitution: “We the people of the United States, in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America.”
Organizations are allowed to exist as long they promote the general welfare. Criminal organizations are smashed whenever possible.
Business is concerned with profit. Profit can help the population at large. If it harms the population at large, it should be regulated so that it doesn’t harm the population, and hopefully helps it.
S&P May Cut $235.2 Billion in Commercial Mortgages (Update2)
By Sarah Mulholland
June 26 (Bloomberg) — The ratings on $235.2 billion in debt backed by commercial mortgages may be cut by Standard & Poor’s as it seeks to reflect how the securities would fare in an “extreme economic downturn.”
The possible reductions, disclosed today in a report, follow S&P’s May 26 statement that the ratings of as much as 90 percent of top-ranked commercial mortgage-backed bonds sold in 2007 may be cut because of the changes in how they’re assessed.
If the securities backed by hotels, shopping centers and offices lose their top-ranked status, they’ll be excluded from the Federal Reserve’s $1 trillion Term Asset-Backed Securities Loan Facility, a setback for the government’s efforts to jumpstart lending. S&P expects to finish the review of the debt over the next three to six months, the company said.
S&P wants to be sure that AAA classes can “withstand market conditions commensurate with an extreme economic downturn without defaulting,” analysts including James Palmisano in New York wrote in the report.
The Fed is counting on the TALF to make borrowing cheaper and help facilitate new lending. Top-rated commercial mortgage- backed bonds are trading at a yield gap, or spread, of about 6.7 percentage points more than the benchmark interest rate, compared with 1.93 percentage point a year ago, according to Bank of America Corp. data.
The debt rallied during the past week amid new sales of repackaged securities designed to protect investors from losses and ratings cuts.
“The market had already braced for the downgrades over previous sessions,” said Chris Sullivan, chief investment officer at United Nations Federal Credit Union in New York.
Too little, too late.
Everybody’s favorite…
Cramer: Wall Street’s Outlook ‘Too Bullish’
cnbc.com
| 26 Jun 2009 | 03:43 PM ET
Market research predicting a big turn in the third and fourth quarters of 2009 might be “too bullish,” Cramer said during Friday’s Stop Trading!. While the shift in focus toward the second half of the year is typical as July 1 approaches, “there are a lot of people staking out high-economic-growth ground right now.”
“This is the most aggressive, bullish stuff I’ve seen,” the Mad Money host said.
Cramer pointed specifically to two new Citigroup reports on Eaton and Cummins . The bank recommended buying both stocks on a “big change in the economy,” he said, which can’t be guaranteed. J.P. Morgan also released a report today predicting significant growth in the latter part of the year.
“Even though I am a bull,” Cramer said, “those are too bullish for me.”
Elsewhere in the market, Cramer urged investors to steer clear of the homebuilders regardless of the goodish news from KB Homes and Lennar . Both companies reported an increase in orders last quarter, but competition against foreclosed-home sales is fierce, with 50% of all sales in California coming from foreclosures, Cramer said. Plus, mortgage rates can’t be raised too boost profits, and incentives are needed to entice buyers.
Investors can buy the banks, though. Cramer endorsed Wells Fargo on its ability to unload its inventory of foreclosed homes, without taking a loss, as prices stabilize. Banks also make money on home-sale transactions.
“There’s just no money being made by these homebuilders,” Cramer said. “The money’s being made by the banks.”
In other words…do the exact opposite of what he says. That clown is ALWAYS wrong.
Gee I wonder why?
“Goldman was repeatedly sued by shareholders for engaging in laddering in a variety of Internet IPOs, including Webvan and NetZero. The deceptive practices also caught the attention of Nichol as Maier, the syndicate manager of Cramer & Co., the hedge fund run at the time by the now-famous chattering television rear end in a top hat Jim Cramer, himself a Goldman alum. Maier told the SEC that while working for Cramer between 1996 and 1998, he was repeatedly orced to engage in laddering practices during IPO deals with Goldman.”
You guys should check out this interview with Sanford’s wife. I like this lady. What the hell she was doing with this loser I have no idea.
The first lady said she confronted her husband immediately, and he agreed to end the affair. She said she wasn’t sure Friday whether he had done so.
“But he was down there for five days. I saw him yesterday and he is not staying here.”
I like her! Throw his ass out. Hillary should have done the same thing! Can you imagine Bill staying at a hotel during the scandal? That would have been priceless!
http://news.yahoo.com/s/ap/20090626/ap_on_re_us/us_sc_governor_wife
What a pair of creeps they are. Pretending to be “for the people” yet the truth is they have beach houses, mansions, kids go to exclusive high dollar private schools….
Yeah….. for the people they are.
Try this again:
http://www.comptrweb.com/tgabm.pdf
None of my posts on Goldman Sachs seem to be getting through.
can you tell us what to look for and where?
FDIC Chair pulls house off the market, can’t get 56% markup
“If you think of the housing boom as basically running from 1997 to 2007, Bair bought her house halfway through, and put in a total of $444,500 between purchase price and renovations. She then tried to sell it after the housing bubble had burst for $795,000 — and finally withdrew the house from the market last week in the hope that the market would improve; she was clearly willing to accept no less than $695,000 for the property.”