Bits Bucket For December 2, 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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Name:Ben Jones
Location:Northern Arizona, United States
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Dec. 1 (Bloomberg) — AmTrust Financial Corp., owner of the Cleveland-based AmTrust Bank that expanded rapidly into Florida and Arizona, filed for bankruptcy, blaming investments in home loans that lost value in the recession.
AmTrust was founded as Ohio Savings Bank in Cleveland in 1889 and expanded into Florida 100 years later under the AmTrust name. It entered Arizona in 2000.
AmTrust, which changed its name from Ohio Savings Bank in 2007, is one of the top 15 home-loan originators in the U.S., according to its Web site. The bank invested heavily in single- family home loans, land acquisition, development and construction loans
Per the WSJ: If AmTrust is seized, it would be the fifth-largest U.S. bank failure based on assets out of 124 so far this year
I read a report by an independent bank annalist that stated he believed there were in excess of 1900 deeply troubled banks currently in U.S. 2010 promises to be interesting to say the least.
Still more news of financial destruction.
I’m tired of typing “cash is king” each time I read posts such as this. I’m thinking of having a key on my keyboard programmed to print-out my mantra whenever I feel it needs to be said. Which is too often.
No typing needed
“blank” post from you is enough
we’ll know what you mean
You don’t keep your cash in a bank do you?
Speaking of cash, I had a CD that matured last week. Called the bank to close the account and transfer the cash to a savings account (that would have earned 0.15% less a year compared to a six month CD). Got transferred to the customer service rep. Offered me 0.50% a year more than the published rate to renew it as a six month CD.
Couldn’t believe it, considering how many other CDs and cash accounts I have with this bank, but it kinda freaked me out that they would be that desperate to retain the cash.
So if you have a maturing CD with any bank and you are below the FDIC limit and don’t need the cash, call them and ask them for a higher rate. If this bank gave me a higher rate, odds are every bank will…
So if you have a maturing CD with any bank and you are below the FDIC limit and don’t need the cash, call them and ask them for a higher rate. If this bank gave me a higher rate, odds are every bank will…
I tried this with Zions a few months back. No such luck. The CD amount was small, but I have ~$FDIC_LIMIT in my accounts with them. I’ve been thinking of trying to use that as leverage in negotiations lately, though.
Whatever CD rate they offered you is probably exceeded by what they can get by buying a government note or bond with the same duration as your CD.
The bank wins, and so do you.
I posted this a few months back but it’s worth reminding folks.
If you have a CD in a credit union that’s paying a relatively high interest rate, see whether they allow additions to that CD. Our credit union does, so as CDs at other institutions mature, the funds are going into the credit union CD and earning 5%. That CD doesn’t mature until 2012.
I’m confused as to how cash has been king since about March. From a Market Oracle newsletter I get:
(this guy predicts inflation, not deflation because debts aren’t going “poof”, they’re getting bought by the Fed)
It seems to be just about any investment has been better than cash the past 8 months.
Disclaimer: I’m in cash and have not been too happy about it. Saying “cash is king” over the past 8 months is like some cruel joke rubbing it in.
Depends on the kingdom.
In an empty kingdom - i.e. cash vs. poverty, then yep cash is king.
In a full kingdom - i.e. cash vs. stocks, gold, oil, bonds, etc. - cash is a peasant. (Housing is the only thing lower - an actual slave)
I like your analysis, Michael Viking. Although, it doesn’t do to put all of your peasant dollars into other investments. Having some peasants around to pay off unexpected things can be mighty pleasant.
Do you think that the correction of the biggest expansion of credit in history is over? The investment bankers act like it.
My feeling is “slowed” is all and that the speculative markets are up on borrowed money. Don’t feel bad about having missed that train, you don’t want to go where it’s headed. JMO.
I thought the recent number of troubled banks by the FDIC’s reckoning was in the 500-600 range? You don’t mean to suggest they might be understating the number of troubled banks to manipulate public perceptions, do you?
Theoretically could work both ways. They could overstate the number of “troubled” banks to keep down the percent that go from troubled to failed.
In reality, I’m sure there is a fairly strict definition of “troubled” that they work with. That sort of data is collected too far down the power chain to be manipulated effectively. Manipulating data without getting caught is pretty much impossible. Manipulating explanations for that data is easier, but still hard.
Asking the wrong questions? That is easy.
expanded rapidly into Florida and Arizona
They should engrave that on the bank’s tombstone.
Banks chasing profits seems to resemble dogs chasing cars. It’s all good fun until…..
Yikes. I had an online savings account there. At one point they were paying 5.6% APY on balances of $100K+. That was mid 2007 when I was playing the chase the APY game after getting out of stocks. I still have about $50 in the account and logged on. Everything seems normal and I transferred out my $50 nonetheless.
So far the FDIC has come through very reliably on its deposit guarantees. (Said by a former WaMu and current Chase customer…)
I wonder what the correlation between offering high interest on non demand (ie checking) accounts and closure by the FDIC is. Even at more than 100 banks the closure rates may be too small for a high correlation, but…
Ooo….I know the answer, pick me.
“Even at more than 100 banks the closure rates may be too small for a high correlation, but…”
more data will be available soon.
Hehehe, I’m sure you’re right.
Back in the mid-80’s several of the Texas S&L’s were offering 5 year CD rates in the 12+% range. The WSJ in those days published the highest rates in the stock quote section. I put some money in Meridian S&L which I believe was in Arlington It was a 5 year CD at 12.5%. I remember wondering at the time, “how the heck could they do that?”, but it was FSLIC insured, so what the heck.
The place lasted about a year after I put my money in, then it and a bunch of other S&L went TU. I did get my principle back after several months, but I do not believe that the accrued interest was paid.
That was the quaint old days when an $800 million debuacle was a big deal.
FHA to toughen rules for borrowers
FINANCES, RISK AT ISSUE
Borrowers would need ‘more skin in the game’
Washington Post ~ December 2, 2009
The Federal Housing Administration is proposing to increase the up-front cash paid by borrowers as part of an effort to shore up the agency’s finances, which have been staggered by rising defaults in its flagship mortgage insurance program, according to FHA officials.
The changes also include raising minimum credit scores for borrowers who receive FHA-backed mortgages and limiting the amount of money sellers can kick in, including paying closing costs or giving free upgrades.
These measures are designed to increase the amount borrowers invest in the homes they buy, thereby making it less attractive for them to default on loans and walk away from properties, as many people have done during the current housing crisis.
Well, this will certainly slow home sales…even with the Buyer tax bribe !
Will it? The FHA limit is pretty low, $300K something like that. So the $8k govt check is 2.4% of the loan already and can be used as part of the down payment. If the FhA raises the downpayment requirement from 3.5% to 5%, it will mean someone will need an extra $4500.
And this is assuming everyone who uses FHA buys at the max. If someone is buying at the very low end, $120K, it won’t affect them at all as the $8K covers close to 7% already. And the majority of FHA loans are at the very low end.
This is nothing but window dressing.
Wow Eddie ,agree with your post .
See below. The questionable part is how easy it is for your typical budget-constrained “first time buyer” to raise an extra $4500 towards a downpayment. I would guess neither Eddie nor I would have much problem doing so, but also that we are in a 1% minority of potential “first time” buyers at the moment, as most people who would have little trouble “raising” $4500 are already owners of one or more houses.
Many, many first time buyers hit up mom and dad for some or all of the down.
Yet we wont let mom and dad put $50,000 from their house proceeds into their kids IRA or other tax free accounts.
——————————————–
Many, many first time buyers hit up mom and dad for some or all of the down.
There’s a way to do something similiar, you can setup a UGM and then transfer the funds to a child’s roth IRA when they get a job. Up to $1800 is taxed at the child’s rate when the funds are in the UGM. The Roth can then be put into an annunity so it’s locked until the child retires. A well to do person can save about $1200/year (30% tax braket for two children) in taxes on this while the children are minors.
300K isn’t really that low. To afford a 300K home, you should have a 100K household income. 90% of this country makes less than that. Even household income, 100K is only the top 15% (or so) of households. And the median household in this country can’t come CLOSE to affording a 300K home, they can just afford a 150K home. So, you have to be making 2X the median household income to afford 300K, which, IMHO, is probably too high for a FHA loan anyway (why subsidize people making that much money?).
This is really part of the re-education process of the United States. A 300K home is a very upper middle class home. A 500K home is out of reach of just about everyone with income <200K, which is just about everyone in this country (the top 5% is 150K, 200K is probably about the top 2%). Until people start to realize that “middle class” (defined as people making around the median income) do NOT buy 300K homes, we are going to continue to grind lower.
i meant low in the sense that it’s lower than $417K conforming loans.
I disagree with the premise that $300K is upper middle class. In parts of the country, sure. But in most big cities, to live in a nice neighborhood (ie no bars on the widows needed) $300K is a minimum. And yes I know you can find examples that say otherwise. I’m talking in a general sense not saying every single house in a nice ‘hood in the country is $300K+.
A $300K mortgage is under $2K a month. Someone making $60-70K a year, which is what a typical middle class white collar worker worker bee earns, can easily afford to pay that.
I believe in purchasing a home priced at 2x income, not at the more optimistic 3x income. I know this would keep a lot of folks from purchasing a home, but then, we wouldn’t have such a huge financial mess and so much overbuilding, would we. At the most optimistic, I would block anyone from taking out a mortgage of a home priced at more than 2.5x proven income, unless they had a fantastic downpayment. That was how they gave out mortgages 30 years ago, and they didn’t have the foreclosure and folding banks problems that we have now. Of course, we wouldn’t have anything to blog about, eh ?
60K a year for a 300K home? Come on, that’s nuts! 5X income? Maybe at 70-80K, but seriously, suggesting that a 300K home is reasonable for someone with a 60K income is almost as nuts as the “boom times”. Any economist would tell you that 3X income is the safe limit for home price, I’m surprised that you’d suggest going so much higher.
60K income is about 3,830.42 take home (assuming no 401K contribution) per month. A 300K home is going to be, at a min, about 2K a month in carrying costs (higher in places like FL). That’s over 50% of take home, again, assuming that you pay nothing into a 401K and nothing towards your medical expenses!
You might be able to afford it, but it certainly is NOT going to be “easily affordable”. You’re going to be eating Ramen noodles 5 nights a week to afford a house at that level at 60K a year! Good luck if you want to contribute to your 401K and have a car.
“i meant low in the sense that it’s lower than $417K conforming loans.
I disagree with the premise that $300K is upper middle class. In parts of the country, sure. But in most big cities, to live in a nice neighborhood (ie no bars on the widows needed) $300K is a minimum. And yes I know you can find examples that say otherwise. I’m talking in a general sense not saying every single house in a nice ‘hood in the country is $300K+.
A $300K mortgage is under $2K a month. Someone making $60-70K a year, which is what a typical middle class white collar worker worker bee earns, can easily afford to pay that.”
I love it: Again, if the houses prices are high, everything else in the world must be warped to justify those high prices.
Geez - this is why we keep snickering at your posts, Eddie. People should not be buying houses at 5x their income. That’s a simple fact.
Don’t forget people moving up. So they might only make $60K a year, but had a bunch of money from young people buying their old home that appreciated highly.
People also shouldn’t eat high fat diets, yet they do. $300K is a middle class house. You can pretend it isn’t and wait for the next 100 years for it to drop to $100K. Be my guest.
So, Eddie…what brings you to this blog? Most of us here here because of the disconnect between middle class incomes and house prices. Since you’re comfortable with that, I assume you’re here for some other reason?
“$300K is a middle class house. You can pretend it isn’t and wait for the next 100 years for it to drop to $100K. Be my guest.”
This is an absurd statement by someone who does not understand the historical housing market and affordability. $300k houses were what doctors, lawyers, and other highly skilled upper crust professionals afforded before all the nonsense started. $60k per year household income doesn’t even begin to afford a $300k house. Six figure income, minimum, is needed. Only 17% of US households earned more than $100k in 2006. I’m sure that number has only decreased. Do the math, if you can that is.
So, Eddie…what brings you to this blog? Most of us here here because of the disconnect between middle class incomes and house prices. Since you’re comfortable with that, I assume you’re here for some other reason?
I think he likes us…he REALLY LIKES US!!!
“People also shouldn’t eat high fat diets, yet they do.”
Yes Eddie they do. And they die sooner because of it. Just like paying too much for a home is financial death! Thanks for putting that together for us.
Michael is correct.
Good job on the numbers Michael.
And prices can fall. Median prices peaked at $385,000 in my town, Sacramento in 2005 and last February they fell to $160,000. Now they’re up to $180,000. It’s really fun to show little starter houses priced at $120K to first-time buyers. Of course, rents are also very low, so people can take their time making their decisions.
I believe the typical ratio falls to 4.3x income in most time periods we’ve looked at. Had a realtor post the data for a while back. Prices tracked income very close and undershoot was very minimal. Might not like the data but the data is what the data is.
Now we are in an unprecidented low rate enviroment so you are potentially setting yourself up to be in a negative equity with prices at 5x income.
Should also note that Barney Frank and company were instrumental at passing on those 729K limits in my area. Guess what level prices are sticking at? Yep.
Also note still seeing many houses sitting for months suddenly jump in price before selling. As we have seen the pattern before it looks like seller assisted downpayment. Fraud passed on the FHA. Anyhow, FHA should be insolvent by early spring at their current loss rate.
I don’t know what was so horrible about the house Eddie pictured. Our standards are almost always out of whack in the ole USA. That probably represents better housing than 95% of the world population. Needs some work and itsn’t special but looks reworkable.
Eddie is just spitting out a lot of the ingrained howmuchamonth stuff that we had hoped would die out. So, we are getting ready for round two of the sickness.
Where is Bad Andy to talk some sense into Eddie? Not sure it’s possible.
Thinking about where prices are going… Incomes are flat to down since 2000. Hence we should see some floor there but its hard to tell as the economy is so muc worse.
Alrighty then. Good luck all.
“This is an absurd statement by someone who does not understand the historical housing market and affordability.”
BINGO.
Gaining perspective and wisdom to understand this requires something more than a 24 year snot nose kid whose had everything handed to him can possibly offer.
$346K in most expensive areas in Georgia
$730K in DC area, NYC, vast swaths of CA, etc.
$377K in Martinsburg WV
You know, it isn’t that hard to look this stuff up rather than making it up.
Take a peek at the moron that’s making this stuff up and you’ll understand.
Don’t you have some people to intimidate into joining your union or something?
Making stuff up again TardBoy?
“If the FhA raises the downpayment requirement from 3.5% to 5%, it will mean someone will need an extra $4500.”
Most people don’t find it all that easy to ‘raise an extra $4500′, particularly ‘new home buyers’ relying on $8K stimulus to provide for their downpayment. A more relevant question to ask is, assuming someone’s FHA downpayment is fully provided out of $8K in tax credit, how much of the prospective buyer’s purchase budget is lost if the downpayment requirement increases from 3.5% to 5%?
The answer is given by the calculation
$8000/(1/5%-1/3.5%) = $68,571.
“If someone is buying at the very low end, $120K”
When I can build for $50/sq ft and MAKE MONEY, 120k is hardly low end.
Good for you. For the other 99.9% of the population $120K is low end.
No. For 60% of the population (those making >40K a year) 120K is low end. For the other 40% of the population 120K is the max affordable home.
“Good for you. For the other 99.9% of the population $120K is low end.”
That’s because houses are too expensive, Eddie, not because “new math” lets people safely buy houses at 5x their income.
So we have a new EddieTard pardigm.
A new house is low end and a 20 year old structure with a fantasy price of 300k is upper end.
Everyone take heed of the blog twentysomething.
I’m surprised a union troglodyte such as Excreter even knows how to hit the keyboard and make the machine beep. Good for you, you’ve outpaced the majority of your high school dropout peers. Well done son.
More reality for tard boy.
http://tinyurl.com/ykq8xra
A gargantuan, pretentious,ostentatious monstrosity fit for a howmuchamonther in Atlanta.(eddie?)
6000sq ft, 3 car garage. Last sold on 3/3/2009 for $680k.
Todays price? $305k.
Price per sqft? $50.83
And guess what? It’s still over priced at $50.83sq/ft.
Michael - just make sure you work with household income, not individual income. Not sure how far apart those numbers are, but they are not the same. Of course, in this economy, one person’s income can easily become the household income…and it might not be the higher of the two.
“A gargantuan, pretentious,ostentatious monstrosity fit for a howmuchamonther in Atlanta.(eddie?)
6000sq ft, 3 car garage. Last sold on 3/3/2009 for $680k.
Todays price? $305k.
Price per sqft? $50.83
And guess what? It’s still over priced at $50.83sq/ft.”
Eddie won’t respond to this, just like he didn’t respond to the car post the other day.
Cowards run when confronted with facts and/or horsepower.
True: they badly need to raise the standards to something more serious (20% down, etc.) to reduce the odds that the FHA will become the next failure that needs to be bailed out by the taxpayers.
Too little, too late this is.
Here is what $120K buys. If that’s what you all think is middle class, then we have different definitions of that term. I personally wouldn’t let my dog live here.
http://atlanta.craigslist.org/wat/reo/1491477338.html
And the thought never occurred to you that the price is grossly inflated.
Nah never.
Eddie, nobody here is arguing that in many areas of the US 120k will not buy a typical middle class residence. But in those areas, the ratio of median household income to median house price is still high compared to historic norms. Now some of that can be explained by the fact that interest rates are still quite low. But it is simply NOT the case that most people been willing to devote 50% of their income for housing in the past. And without dreams or fears of future housing appreciation there’s little reason to believe they will to be willing to eat raman noodles for more than a decade to purchase a house.
That’s actually a nice brick rambler on acreage which only needs updating. Apparently, Eddie has no imagination, and likely prefers poorly built stucco sh!tboxes on zero lot lines thrown-up by big national builders using illegal alien labor. He probably watches “The Real Housewives of Atlanta” and drives a Hummer with 22″ wheels purchased with zero down.
I emailed about how much rent he was getting: (I’m jack duh)
Hey Jack,
I’ve owned the place since 2003 and the rent’s varied from $1200 (the lastrenter) to $1350.The one who paid $1350 rented the backhouse to a brother-n-law for $500 and netted their rent for the front house to $850.
The county won’t let you rent them separately because it’s not zoned for aduplex, but I’ve been able to rent them to one family who used bothresidences. Everything around it is owner occupied.
Thanks
Bruce
That is actually a nice home which IS middle class, at least in many parts of the country. Yes, it needs updating. No, it’s not a slum. I’ve lived in much worse at various times in my life. And, some better. Eddie, you made fun of some kind of $ 650,000 home in CA a few days ago. I looked at it, and thought it was quite a nice place. I think you’re the Martha Stewart housing aesthete of the HBB, or MSH(A)E.
I like it too. 1/5 acres that back up to a park sounds wonderful. It would be fun to buy it and slowly improve it over time. You should think about it Eddie, if it’s close enough to where you work and the schools meet your needs.
Whooops, I meant 1.5 acres.
Can we possibly agree on a few basic points?
1) Even after their recent decline, home prices are grossly inflated compared to incomes in most parts of the US by historical standards.
2) The Fed has actively intervened in the housing market to artificially prop up housing prices on a plateau.
3) Whether the plateau proves to be temporary or permanent depends crucially on whether the Fed withdraws its housing market life support as the economic recovery continues to gather strength.
4) We could see perverse intertemporal decoupling between the timing of the recession trough and the housing trough. For a historical instance of how this can happen, note the early 1990s recession officially ended in 3/1991, while the CA housing market did not hit the price trough until 1996 or so.
I think the tax credit is 10% of the purchase price UP TO $8,000. For the FHA limit the credit is $3,000 by this rationale.
Well, this will certainly slow home sales…??
Not with the guy at Carter out of Atlanta…They are bidding on portfolio’s of housing…They just purchased one with 270…
Jimmuh Carter is buying houses?
FHA to ask Congress for changes…
Yeah, this will work…no wait -
Oh Bother,
Leigh
They should make the “future value” of the house available for the downpayment.
Take the price now, and subtract it from the value in the future, say 2019. You could use the difference as a downpayment.
It’s all cool.
Wasn’t this the fact with 120% financing so popular just a few years ago?
Isn’t it unconstitutional for the government to have mortgage quailification standards at all, let alone raise them? You know the amendment where you cannot be held responsible for your own actions. That amendment.
What’s a “constitution”?
Politicians don’t know the difference between prostitution and constitution. They f— both pretty freely.
In a prosthetic way.
You know, the same document which declares that you have a right to an enormous bonus if you are a banker.
What’s a “constitution”?
a person’s state of health
a person’s disposition of mind; temperament
I can’t believe you didn’t know what a constitution was…. gosh.
Thanks Rio, whew.
I try to be temperate, mostly in the mornings.
“Bad Idea” ≠ “Unconstitutional”
Some good policy ideas are unconstitutional; some bad policy ideas are constitutional. Stupidity, sadly, is not unconstitutional. Have you been hanging out on DU?
Thank you.
Side question - how do you do the “not equals” sign?
Just use “!=” or “” like a good programmer.
Oops the second one is suppose to be
Grrrr.. guess less-than and greater-than symbols don’t show up on this website for some reason.
I sometimes do - but non-programmers don’t usually get it.
Grrrr.. guess less-than and greater-than symbols don’t show up on this website for some reason.
They open and close HTML tags, so are stripped out of the posts unless there’s a complete tag.
They open and close HTML tags, so are stripped out of the posts unless there’s a complete tag.
Use < >
Remove spaces from these and you’ll have it:
& l t
& g t
Use < >
Hey! It worked on preview!
Drumminj!
<
Ah. Forgot the semicolon, maybe?
& l t ;
<>
FAIL
haha mine didn’t work either lavi d
Altho’ I have to say thx for the info, I couldn’t recall which characters went before and after.
How did you preview?
How did you preview?
You need Drumminj’s Joshuatree Extension.
Link
Hey! It worked on preview!
Drumminj!
Hey, where’s the email with the bug report?
Actually, that appears to be a FF bug if anything. All preview does is take the text from the comment box and set it as the innerHTML of a DIV node. It does smiley substitution and checks for unclosed tags, but nothing else. So if it shows up as the less than sign in preview, it SHOULD show up that way in the post….
Let’s try:
No semi-colon: <
semi-colon: <
^^^ interesting. I’ll have to look into that, and why the preview functionality doesn’t work properly
I have a Q: By “up front,” do they mean cash “now?” By “now,” I mean $100 bills at the closing table, not a we-know-you-have-a-tax-credit-coming type of Now.
Tax credits are delayed money. I really hope they are aiming to filter out those buyers who play on the delay. People who play on the delay* are definitely riskier.
———
*by this I mean they need to play on the delay to survive, not people who play on floats to maximize returns, i.e. Eddie.
horse…barn…left…yada…yada…yada.
So the government response is: I guess we don’t need to worry about working on fixing the door then. Party on.
the euphemism suggest the barn door is not broken but just left open…and horses have escaped.
you got to reign in the horses before you can shut the door…which is a much bigger fish to fry.
“FHA to toughen rules for borrowers”
What on Earth are they trying to do — increase affordability for credit-worthy borrowers?
FHA is laying the ground for a bailout request. It is blaming everyone but itself for its failures. It canceled Lend America’s contract and says it cannot police its lending practices without congressional approval.
That was my interpretation as well. They have been intentionally lending at below-market credit-standards for the past two years (and thus dominating the market), and they know it will come home to roost eventually.
They are laying the groundwork for a “but we tried to make sensible changes and weren’t allowed to do so” defense.
Smart move, really, IMHO…
Anyone here familiar with the Kansas City RE Market at all - especially the northland??
May be moving back to take care of my Father & prices look crazy compared to 10 years ago….I thought the unemployment was hitting hard there….?
Shelby:
This is EXACTLY the mindset that causes the most trouble. Why do you HAVE to buy? Who knows how long you will live there…pops maybe gone sooner then you think and you will have his house.
If you wanted to buy why not a mobile home? Cheap re-sellable you wont lose much money ….and again you will have pops house to deal with or live in.
If we could understand the thinking here…It could have stopped millions from buying a house they were never going to stay long enough to break even on.
yeah it used to be a no-brainer to rent…everyone thinks they’re going to sell higher..
“If you wanted to buy why not a mobile home?”
You cannot be serious.
Why not?
Think outside the box Ed. Granted it’s not for everyone especially if you’re raising kids but from what I hear there’s nice trailer communities out there.
yeah I can’t believe I even said that.
Why bother with a trailer park? I think you can get a bed at the YMCA for $8 a night. Think of all the money you’ll save that you can use to buy gold and someday buy that dream $120K house with cash.
Because silly you can’t string every kind of Christmas light around the flamingo family you planted outside, you’re limited to your room display only.
sheesh do I need to explain EVERYTHING?
Eddie, don’t be so judgmental. My dear great aunt and uncle, who were childless so were godparents to every kid born to the family for a 20-year period lived in a trailer park in Pittsburgh. We loved to visit them - trailers are very novel and fun for a kid. They were lovely people - they were always slipping tens and twenties in my parent’s pockets. And they were very happy.
You want 5000 sq ft. Most of us don’t. And it’s not that we can’t afford it.
Not sure if anyone reads a “fully baked” (i.e. 250+ post) bits bucket, but here goes—
I think Eddie is trying to say that prices are sticky and people are generally not smart about their financial affairs and will continue to overpay for housing. How can you argue with that? Why the pejoratives against this guy?
Yes, there is a massive disconnect from fundamentals. Why is this surprising, given the ocean of money out there offering massive credit, combined with a world where we are all taught to be consumers, in an economy that has fallen off its rails (basically from foreign competition which cannot be stopped)???
I am long on the notion that correction will be a long time coming. People on this blog have very different views than most of mainstream America. Just to poke a little, I would even concur with Eddie’s point he made some time back about how folks on this blog may even be conservative to a fault and not be thinking about how to profit from this whole mess.
Eddie,
There are more high income, high net worth homeowners that read and post here than you might surmise. There is also great diversity…in age…income…employment…geography and on and on that encompass this blog.
While I enjoy your posts and enthusiasm, your posts oftentimes seem very narrowly focused. For those of us that have lived more than four decades, invested well and watched the unhinging of the real estate market - your posts sometimes come off as arrogant and lacking in the breadth and depth of this housing mania.
Eddie, when reading here, try to step outside of your limited perspective and analyze the housing bubble with a true understanding of the demographic and geographic diversity.
And by the way, I own a home, some gold, very little debt and through experience, I can tell you that a mortgage anything above 2X income in a declining market (my experience in the late 80’s) is painful. There is no upside in this current market.
I am not Eddie.
YES eddie a damnnn mobile home………
Why not??? pops may not last long then what? she will have 2 houses to deal with instead of a cheap little trailer.
Plus she may need the money for pops medicine medicare doesn’t cover everything…so another choice pay a big mortgage and let pop suffer?
The loss will be minimal, and maybe she other plans after pops goes…..
this is where we could use some of az-lend’s insight, one has the idea that her mobile parks are a little more upscale, n’est-ce pas?
az_Lend are you out there - help us out pleez!
DJ-
Sold at the top in DC 3 years ago-rented ever since
can buy out right in the midwest on acreage as well ……….you get the picture
YES i do…..good luck……but seriously why buy? is this going to be like the next 5-10 years he is going to be sick?
Its your money..but what happens when he goes…who gets the house?
I think a lot of people on this blog would buy a house today if its the last house they will ever buy, and intend to die in it.
Other then that scenario….the consensus here is its gonna get cheaper next year and the year after and….
I’m originally from KC and still have friends there. I also recently considered moving back there to care for an aging parent.
I’ve been keeping an eye on the area west of the Plaza (Westwood, Westport, Fairway, Prairie Village, etc.). I am seeing a lot of houses sit for a very long time. Have also seen houses that are for sale offered for rent at a lot less $ than the cost of owning.
In the inner city you can buy houses at Detroit prices - I found that a bit shocking (not that you’d want to live there.)
Prices are WAY out of line with reality, so be very careful. I’d also think hard about buying in the KCMO city limits, because of taxes, schools, etc. (That’s why NE Johnson county appeals to me.)
While they have a more diversified economy than some areas wages are also lower and can’t support the kind of “wishing” prices some are still asking.
Young-
I’m thinking of Parkville, Kearney or Liberty
not living inner city or plaza…plaza would be cool, but I’m sure it’s still for the rich only even now
Probably my observation that would be most helpful to you is that the houses I’ve been monitoring since around June seem to have 5 or 10% reductions in price every 30 to 60 days. Several have been taken off the market and show up later on the MLS as “new” listings. Some sometimes disappear from the MLS and show up on Craigslist as FSBO.
So I can’t imagine that prices north of the river aren’t also following a similar pattern. And I think they only have farther down to go.
Also KCMO does have some records on-line that you can use for property research.
Just for an exercise do a real estate search on zip 64112 (MO side of state line) and 66205 (KS side, NE Johnson county)
There are quite a few houses under $250,000 and some under $150,000. (Not in Mission Hills of course, and condo prices around the Plaza are surreal.)
Love Parkville (as long as you’re not in the floodplain) because it has real charm.
Bernanke Has Support of Majority of Senators on Banking Panel.
Dec. 2 (Bloomberg) — Ben S. Bernanke has the backing of a majority of U.S. senators on the Banking Committee for a second term as Federal Reserve chairman.
Eight Democrats and four Republicans, among the 23 lawmakers on the panel overseeing the central bank, made their views known in interviews, comments to reporters or written statements. Some said they will support Bernanke, while others said they’re leaning in his favor.
Committee Chairman Christopher Dodd, a Connecticut Democrat, said yesterday that Bernanke has “done a pretty good job,” and that anger in Congress over the Fed’s role in the financial crisis is “misplaced.” Judd Gregg, a New Hampshire Republican, said Nov. 20 he will “absolutely” vote for Bernanke.
Say it’s not so! This elite group of Bank bought henchmen supports the head of the FED. Amazing!
Shopping center trade group trims November sales forecast as shoppers curb holiday buying.
NEW YORK (AP) — A prominent retail trade group trimmed its November sales growth forecast on Tuesday, citing more shoppers saying they’ve delayed holiday purchasing compared with a year ago.
Michael P. Niemira, chief economist for the International Council of Shopping Centers, now predicts that November sales at stores open at least a year — a key industry barometer — will be up 3 to 4 percent, compared with the steep 7.7 percent drop a year ago.
The uneven start is worrisome to economists because how consumers behave during the holidays and beyond will be key to how strongly the economy rebounds from the worst recession since the 1930s.
That’s because spending on goods and services for consumers accounts for about 70 percent of U.S. economic activity by federal measures. The holiday shopping season accounts for as much as 40 percent of annual sales and profits for many retailers.
But the projection is below Niemira’s original forecast for growth in a range of 5 percent to 8 percent.
Not to worry - my wife is on her way to New York on a bus with 35 other women - shopping/fun trip. I expect the stock market to go up 10% in response.
A bus full of stimuli
Dave, still enough time to cancel them credit cards.
Do it now!!!
There was a sobering expose’ on the credit card industry on the PBS Frontline series recently. It is available on the Frontline website.
It is a must read for anyone who has or may have a credit card. I sent the link to both of my young, consumerist daughters pleading with them to watch and take heed.
One of the people shown in the series had a revolving balance of $400, was late on a payment, resulting in a late fee and interest charge which put her over her credit limit which drove an over limit charge and on and on. By the time it was all said and done, she owed something like $3000, with no additional purchases.
The practices of the industry are bad enough, but the arrogance of the people in the industry is beyond the pale.
Most of us have to have a credit card to live in this society, but watching this documentary will open your eyes, big time.
I remember the good old days, that if you went over the cc limit at the restaurant, the waiter would bring the card back and quietly say that the card “didn’t work” or “wasn’t ringing up properly;” in other words… de-nied.
It embarrassed people, but it kept them out of trouble. Now they lay traps, and stand by grinning like the Cheshire cat as you unknowingly go over. The worse part is that do this now for debit cards. Yes I know people should keep track of their accounts, but you don’t even have the option of opting-out of this trap.
How is it an eye opening sob story that a $400 bill turns into a $3k bill without any additional purchases? Did the CC company really assess her $2400 in penalties in 1 month? I don’t think so.
Nope it built up over several months. I didn’t say Sob story, I said a sobering expose’. There is no doubt that the CC companines lay huge traps for the unwitting and unwary and reap huge rewards for thier efforts. The executives from the industry freely admit as such. And all the CC reform act has done is given the CC companies a six month window to solidify the practices before the reform takes effect.
Almost half of banks (and other retail financial companies) profits are from fees and penalties.
I called and renewed a family level museum membership for my brother and sister in law yesterday which makes my holiday shopping season officially over. Over Thanksgiving, my cousins, wise young men that they are, readily agreed to forgoing a holiday present in exchange for getting to pick out something at the museum gift shops when they visit in the spring. It will cost me more, but they will get something a) that I know they want and b) that will help them remember their first trip to DC. Worth it to me. Also worth it to just contribute less to the feeding frenzy around this time of year. I have one box to mail to the niece and nephew and then I will be completely done.
Do any of the retail sales reports on existing stores review what the sales increase would have to be to make up for the local stores of either the same company or its competitors that have closed? Just saying, if you have 4 places in an area to get a hair cut and 2 closed, you would expect the remaining two to have at least some increase even if the number of haircuts being paid for in the area has gone way down.
“readily agreed to forgoing a holiday present”
What an awful politically correct term. Which holiday would that present be for, Arbor Day? Better yet, let’s just lump everything together and call it, “The Unoffensive Solstice Fest”. Festivus for the rest of us.
If anybody gives me a “holiday present” I will shove it right down their throat. Unless it’s Jack Daniels. Then I will just kick them in the groin and drink the Jack.
Here comes Santa Claus down Santa Claus Lane HO HO HO Merry Christmas NYCboy….jolly mistletoe for you and the wife…
and If we have another HBB meeting I will give you a Jack as an appreciation for all the hilarious posts you have given us…..let all sing Joy to the World….
Jeremiah was a bullfrog……….
Their family celebrates both Hannukah and Christmas. I ususally try to get them something by the start of Hannukah since that is the holiday celebrated by my side of their extended family, but have been known to miss it depending on how organized I am. Also, if I am going to visit them between Christmas and New Year’s, sometimes I wait and give their gifts to them then because it is fun to see them open it.
Take a chill pill, NYCBoy. It is December. They are between 8 and 13. I ususally give them a present around this time of year. Nothing sinister about it. And I helped them pick out new ornaments for the Christmas tree on the Saturday after Thanksgiving - penguin, hockey player and triceratops if anyone is interested.
A little cranky today, NYCBoy ? Watch out, or the Holiday Reward Renderer will leave a lump of bithuminous material up your cloaca instead of a Holiday Present. As far as the Solstice goes, I doubt that the Lord & Lady of the Hunt/Dance would appreciate your attitude at all. Geeze.
Then I will just kick them in the groin and drink the Jack.
You saw that movie?
If anybody gives me a “holiday present” I will shove it right down their throat.
Put the “X” back in Xmas.
lavi d. You are definitely not a whack-job. Just a little eccentric.
Who is being PC? You are telling Polly what words to use, I don’t see her telling you what words to use. Some of us call it the ‘holiday’ because that’s what we want to call it.
“I called and renewed a family level museum membership for my brother and sister in law yesterday which makes my holiday shopping season officially over.”
Brilliant! I never thought to do something like that.
I get the tax deduction, too. They live about 3 blocks from this musuem, so they go several times a week. And, since it isn’t “stuff” they don’t have to find a place to put it. My family is seriously getting into the “something to do, not something to have” mode when it comes to gifts, at least for adults. I expect they will give me a gift certificate to the Smithsonian Resident Associates programs. Then I will sign up for an upcoming lecture by Joseph Stiglitz.
Son still has no idea what he wants. He will probably end up with a movie. Still waiting on ideas from middle daughter on what she and her husband would like. They will be here around New Year’s. Will spend less than $100 total. I’m not doing much to help stores.
“Do any of the retail sales reports on existing stores review what the sales increase would have to be to make up for the local stores of either the same company or its competitors that have closed?”
I’ve wondered the same thing but I have yet to find the answer. The best example that immediately comes to mind is Circuit City/Best Buy. BB surely has better sales YOY because CC is no longer there to compete. Anyone else have the answer?
CC isn’t there, but there’s an Ultimate Electronics a half-block from the local BB, and Wal-Mart is attempting to crack that market as well. Which probably means Ultimate will go under and it’s time to think about shorting BB.
UE didn’t last long at all here. 1 year i think. Fry’s is the only serious competition for Best Buy.
Polly, I did a bit more searching and found not a lot. But this article would indicate that defuct retailer are indeed excluded from consideration, so CC, BBB, etc. don’t figure in the decrease.
http://industry.bnet.com/retail/10003994/circuit-citys-demise-not-lifting-best-buy-yet/
There is also a gross retail number produced by these folks:
http://www.shoppertrak.com/system/files/NRSE%20Product%20Information.pdf
It is a black box so one can’t tell if they account for the defucts.
I assume you mean Circuit City and Linen’s and Things. Bed, Bath and Beyond seems to have survived.
Right, they all run together in my mind.
States will be scrambling more and more to come up with new tax dollars, there are bound to be many creative taxes to come.
Virginia wants to regulate yoga; instructors fight back.
ALEXANDRIA, Va. (AP) — Three Virginia yoga instructors aren’t feeling so Zen about a state plan to regulate and license would-be teachers of the ancient discipline.
The instructors say they plan to file a federal lawsuit in Alexandria on Tuesday arguing the plan infringes on their free speech rights.
They say entrepreneurs would have to ask the government’s permission before they open their mouths or face fines and jail time. And they say complying is costly and time consuming.
The State Council of Higher Education for Virginia wants to certify yoga teacher training as it does the teaching of dog groomers, dancing instructors and bartenders. It says certification will make sure students get their money’s worth.
Several other states have attempted to regulate yoga instructor programs this year.
Thank GOD they are regulating dog groomers. There’s a group, left unregulated, will topple the Western World. Their ‘creative’ approaches to cutting and brushing dog’s fur (or hair for pooodles) has cost billions to pension funds and other investors.
I’m glad they’re finally getting around to yoga instructors too. I mean, what goes on during those yoga sessions held behind closed doors in their glass towers? What decisions are they making that will affect me?
They are not regulating dog groomers, but rather the teachers of dog grooming.
I imagine next on the list will be regulating yoga students, maybe with the institution of yoga degrees.
Dog gtoomers, yoga instructors, light bulbs, toilet flush volume. And soon coming to a theater near you, forcibly having to buy health insurance with a threat of jail time for refusal.
America one home of the free, now home of the bureaucrat.
I have no problem with this as long as OHbahma’s threat comes with a full time job to pay for it…
forcibly having to buy health insurance with a threat of jail time for refusal.
When the world inside is spinning out of control, the maniac naturally does everything possible to control the world outside, as if it will make the dizziness stop.
Yet another point we agree on Eddie.
So very true.
Yep.
I paid an extra $0.50 for a Subway footlong yesterday. They now charge to toast your sandwich. It is a new CA state tax.
Carbon credit to use the microwave?
And they say complying is costly and time consuming.
Which of course will lead to underground yoga centers. Clandestine groups meeting in dark cellars to practice their ancient art.
Somali sea gangs lure investors at pirate lair.
HARADHEERE, Somalia (Reuters) - In Somalia’s main pirate lair of Haradheere, the sea gangs have set up a cooperative to fund their hijackings offshore, a sort of stock exchange meets criminal syndicate.
Heavily armed pirates from the lawless Horn of Africa nation have terrorized shipping lanes in the Indian Ocean and strategic Gulf of Aden, which links Europe to Asia through the Red Sea.
The gangs have made tens of millions of dollars from ransoms and a deployment by foreign navies in the area has only appeared to drive the attackers to hunt further from shore.
It is a lucrative business that has drawn financiers from the Somali diaspora and other nations — and now the gangs in Haradheere have set up an exchange to manage their investments.
One wealthy former pirate named Mohammed took Reuters around the small facility and said it had proved to be an important way for the pirates to win support from the local community for their operations, despite the dangers involved.
“Four months ago, during the monsoon rains, we decided to set up this stock exchange. We started with 15 ‘maritime companies’ and now we are hosting 72. Ten of them have so far been successful at hijacking,” Mohammed said.
“The shares are open to all and everybody can take part, whether personally at sea or on land by providing cash, weapons or useful materials … we’ve made piracy a community activity.”
Wow, Goldman Sachs got nothing on these guys.
Right — in both cases, we see the invisible hand of the unfettered free market, unrestrained by the rule of law, carrying out its business…
With no respect to property rights and no punishment that deters further violation of the rule of law.
Law and regulation aren’t the same thing. Theft and redlining for mortgages shouldn’t be treated the same.
Law without enforcement has little heft. This is why I oppose the notion of making the Fed the one bank regulator. They have failed miserably in their regulatory enforcement role over the past few decades; wouldn’t that suggest there might be a great risk of failed enforcement if they are given sole regulatory authority?
Well there’s always that Consumer Finance Protection Agency that Elizabeth Warren wants to set up, which consolidates lots of regs into one place. Let that compete with the Fed.
Might be a good way to walk the tightrope between economies of scale and full-on monopoly.
I like the idea of regulatory competition, where all the regulators have joint and several authority to heavily penalize banks which break the law.
In fact, I would like to see as a first step the breakup of too-big-to-fail banks which threaten the global economy if they blow up. We have already seen how badly screwed everyone except for the managers of Megabank, Inc can be thanks to allowing the too-big-to-fail problem to fester until it turns into gangrene requiring amputation.
Haradheere? (pronounced “har de har har”, perhaps?)
A stock exchange for pirates?
I smell “The Onion”.
“I smell “The Onion”.
Nope, that is a real live AP report.
It was from a Reuters report…
http://www.reuters.com/article/wtUSInvestingNews/idUSTRE5B01Z920091201
The British had it figured out how to fight pirates in the 1800’s ,and it was rather gruesome and final . But it was fully and permanently effective . With today’s high tech gadgets , the world’s finest navies don’t seem to be able to do it , to keep shipping secure .
They should hire yoga instructors.
Actually, better yet, let’s do an exchange program, Goldman Sachs traders for some Somali pirates.
Don’t forget to issue name tags so you can tell them apart.
I agree. Your typical Somali pirate is, in all likelihood, too prudent to cast hundreds of billions of dollars into the sea. They may actually be better at banking than some Wall Street bank managers have proved to be.
They probably are better at utilizing personal side arms, too.
And more honest.
P3 Orions with Mk 50 torps. Almost everyone has them too.
How about arming the merchant marine sailors?
If these guys don’t have the incentive needed to ward off pirates, who does?
If I recall, the pirates operated for 200+ years until the British Navy had a technology shift and moved away from wind propulsion.
With today’s high tech gadgets ??
Let the drones patrol it…
Talking to reporters was about the dumbest thing they could ever have done. FINCEN lives for this sort of thing.
http://www.fincen.gov/
If I were a wealthy ship owner I most likely would try to strike a deal with these pirates: If they would promise to stop highjacking my ships I would promise not to hunt them down and kill them.
Hijacking and ransom by pirates is a business model, including U.S. educated Lawyers as the negotiator. NPR did a segment on it this year.
I assume Goldman Sachs is somehow involved in this…
Ahhh. A true free-market economy in action. Such a bother all those silly international maritime regulations.
Private sector shed 169,000 jobs in November.
NEW YORK (Reuters) - U.S. private employers shed 169.000 jobs in November, fewer than the 195,000 jobs lost in October, a report by a private employment service said on Wednesday.
The October fall was originally reported at 203,000.
The median of estimates from 30 economists surveyed by Reuters for the ADP Employer Services report, jointly developed with Macroeconomic Advisers LLC, was for decline of 155,000 private-sector jobs last month.
Cummins just announced 400 today…
Electronics sales soar; clothing, luxury sectors stumble in Nov, according to early estimates.
NEW YORK (AP) — Electronics sellers and online merchants thrived in November, particularly on Black Friday, but clothing and luxury merchants struggled, according to estimates released Wednesday.
Those results, combined with a trimmed sales prediction for retailers’ official November results, raise worries that some sectors could face tough going in the critical countdown to Christmas as they grapple with frugal Americans contending with job insecurity and tight credit.
“Last year, it was uncertainty that was driving the cautiousness,” said Mary Delk, director of Deloitte Consulting. This year, it’s “anxiety about their (own) personal finances” that’s making shoppers more frugal.
Fat discounts drove shoppers to stores and online this past weekend, and Delk thinks it’s likely they won’t come back until the season’s final hours when the bargains are even better.
When was the last television set made in the USA? Zenith had a plant out here in Northlake and Motorola had one in Melrose Park, but that’s ancient history.
These shoppers are digging their own graves. And they have the nerve to be perplexed as to why their real aggregate wages keep going DOWN.
I think VIZIO is in California, I’m not sure if the TV’s are built in U.S. or just assembled. They seem to get pretty good reviews.
No kidding? I applaud their effort then because the crowd they are competing with think nothing of dumping inventory just to drive out competition.
I thought that their main claim to fame was getting pretty good quality out of Chinese manufacturers.
That could be the case, and would make more sense. I couldn’t find much info on their site regarding this.
Sharp just finished one of the higher end flat panel production facilities and it’s not in the USA. It’s all robotic anyways, so it’s not like it employs that many people.
Google shows a lot of vizio USA questions. Appears there might be some assembly in Cali from all foreign parts. Others report theirs say made in China.
Actually, now that I think of it, ISTR that their main money-saver was having the DESIGN work done in China. So unlike others they’ve also managed to outsource the good paying, highly skilled jobs instead of just the cruddy ones.
Up until a couple of years ago Sony made TVs in SW PA.
They used to make TV’s in San Diego.
These shoppers are digging their own graves.
To my way of thinking, it would seem that prices of flat screen TVs will soon bottom out and then, after many of the manufacturers have gone out of business or changed to other items, will rise.
So now might be the best time to buy a flat screen. Well, right after Christmas, maybe.
Unions dug their own graves with unreasonable demands and poor work ethic. Not just in making TVs but cars too. I will never even consider buying a GM, Ford or Chrysler. I don’t get if they offer me 150 months 0% financing. I’ll gladly buy a Nissan or Toyota made in the US however. They’re made by non-union workers and the difference in quality shows.
Yeah, those tires falling out from under the Tundras as the first indicator the chassis is rusted out and the unexpected thrill of a runaway throttle in Toyota (and Lexus) cars are a real tribute to this high quality. The media driven case of problems with US made cars and lack-of-problems with foreign models are essentially a product of the same focus-on-the-true-belief mindset that drove the climnate change “data” (laughing).
I will always buy an American made car. I try to buy American made products whenever I can. Yes, I have a bachelor’s degree in business and support the american workers.
Yeah, I keep forgetting it was the unions that dictated product design and made the dealers such a pleasure when you needed warranty work done.
Oh, and FYI, the Japanese companies treated their line workers better than any union could hope for.
For some reason, real, tangible rewards seem to motivate your average employee. But that’s just damn socialeest/commie talk, ain’t it? Because by god, they ought to be on their knees and thankful they even HAVE jobs, no matter what the conditions and pay are, shouldn’t they?
“These shoppers are digging their own graves. And they have the nerve to be perplexed as to why their real aggregate wages keep going DOWN.”
And they had a choice, when, exactly? Before or after the companies they worked for offshored their jobs?
Climatic Research Unit at the University of East Anglia Director Phil Jones Steps Down
http://www.boston.com/bostonglobe/editorial_opinion/oped/articles/2009/12/02/climategate_dissent_on_ice/
Looks like this house of cards is getting ready to cave in. Will BHO concede or will he double down in Copenhagen? IMO he will adhere to his Chicago style of politics and he will double down.
Australia’s Parliament defeats global warming bill ~ Associated Press
SYDNEY – Australia’s plans for an emissions trading system to combat global warming were scuttled Wednesday in Parliament, handing a defeat to a government that had hoped to set an example at international climate change talks next week.
The Senate, where Prime Minister Kevin Rudd’s government does not hold a majority, rejected his administration’s proposal for Australia to become one of the first countries to install a so-called cap-and-trade system to slash the amount of heat-trapping pollution that industries pump into the air.
Just last night on the NewsHour there was a report about the Australian Dust Bowl. They are having a record drought that look exactly like the US in the 30’s. However, they way it’s not a temporary drought — global warming is changing the rainfall patterns making SE AU a permanent desert.
And the Aussies are still against cap-and-trade?
Permanent? Just like our Dust Bowl was permanent?
GOOD maybe we can build coal fired plants real fast so we wont have to buy oil and pay for Dubai’s financial crapola….
What????? we have 200 years of coal in America…sure it will destroy some of the landscape but how many rich people want to build million dollah condozes on da hillsidzs and live permanently live over a coal mine???
Really there’s no problem living OVER a coal mine. There is after all some BEAUTIFUL scenery in WV. OTOH, there’s really nothing pretty about FORMER strip mines. “Mountaintop removal,” creates some ugly flatland where once were pretty mountains.
As long as you are upwind of the power plant that burns it.
Great timing — just before the Copenhagen climate conclave!
Doubling down is a win win for him. He can’t keep any promises he makes to his “peers” anyway.
And they still want to sell houses a $300000 and up. The amount of underemployed should be bringing down housing prices alone. That does not include all the other scams/fraud and alike.
http://finance.yahoo.com/career-work/article/108267/working-two-jobs-and-still-underemployed?mod=career-worklife_balance
Federal Reserve Chairman Ben Bernanke last week lamented:
“These data suggest that the excess supply of labor is even greater than indicated by the unemployment rate alone,”
Atta boy, Bennie!
Did he mean U6 unemployment (17.5 percent or so)? How big does he estimate the excess supply to be?
Sure sounds like U3. Or maybe it was a slip? Far be it from him though, to share his real thoughts with the likes of you or me.
23 years and then on the street… Underemployed ?? Not in Eddies world…
Oh god, before this stupid discussion goes non-linear. The only people included as underemployed are PART TIME WORKERS SEEKING A FULL TIME POSITION.
I’ve been thinking though, perhaps in a couple years thigs will be going so well on necessities that we will only have to work part time. Perhaps, 30 hrs per week will be plenty!
Think about farming as an example. The number of people that are farmers dropped by an order of magnitude.
About housing: we were able to build an excess supply.
About automobiles: we were able to build an excess supply.
There are a lot of pricing problems and currency issues but I wish everyone would also take a look at the bright side and note we should be heading into a greater period of abundance.
Of course I have lots of ideas on concentration and conservation policies to make the country more efficient and have nicer open areas. There are concerns about sustainability and the enviroment.
I do see an era of promise with great potential before us.
Short term I see lots of stupidity happening to one another, our currency and in generalized governmental stupidity. After we work through the bad stuff we should be OK though.
James,
Did you used to have a website that discussed sustainability issues and civic planning concepts? If so, could you link to it again? Some truly brilliant ideas in there, as I recall.
Thanks.
“The amount of underemployed should be bringing down housing prices alone.”
Even if the market is being artificially propped up by
-
First-timehomebuyer’s tax credit;- Fed MBS purchases to drive mortgage interest rates towards the floor;
- Huge expansion of government-guaranteed FHA lending?
I’ve now seen 6 recessions in my life. 2 (2!) for every decade I’ve been in the work force. And after each recession, there were less jobs that paid a decent living and more McJobs that didn’t pay worth squat.
It will be the same this time as well. And the next. And the next until we truly become a 2nd rate nation with all the gains and progress fought and died for in the last half of the 20th century are long gone.
You want to know what the future looks like? Look at Great Britain.
Guessing he misplaced his Nobel Peace prize.
Message to Taliban: Just lay low until 2011.
I see where Chris Matthews called West Point an “enemy camp.” No surprise there.
Also, I don’t know anything about the German MSM but Der Spiegel really seems to be on The One’s case.
http://www.spiegel.de/international/world/0,1518,664753,00.html
The lead sentence is: “Never before has a speech by President Barack Obama felt as false as his Tuesday address announcing America’s new strategy for Afghanistan.”
I wonder if drooling Chris felt another ‘TINGLE” run up his leg during Barry’s little talk.
You’re absolutely right, taking some time off from the fight is no big deal at all for those guys.
In 1980 two decent war movies came out: Das Boot and the lesser known Lion of the Desert. Pops gave me choice of which to see and I chose the latter. The film depicts the Italian campaign in Libya - that spanned three decades from around 1912 to basically WW II. While difficult to find on DVD it’s a good primer to understanding this type of warfare. As was the case for the Brits in the Boer War, in Libya the Italians eventually had to lock away considerable portions of the population in concentration camps to gain any real control of the situation.
Their timeline couldn’t possibly be more different than ours.
Pops had good taste in movies.
Lion of the Desert is available via Netflix, BTW.
Message to Obama detractors: If he yesterday that we might stay the course beyond 2010, the political opposition to sending in more troops would have been far stronger.
“said during yesterday’s speech”…
Yep!
Along with a withdrawal time table just in time for re-election. Plans like these have a way of backfiring though.
He had to throw in a bone for those who think we might never finish our business in Afghanistan. What is to prevent extending the deadline for withdrawal if things go “worse than expected”?
There is an interesting (if a bit far flung) parallel between this deadline and the Nov 30, 2009 terminus of the first-time homebuyer tax credit that just passed. The point is, there is nothing that prevents deadlines from being extended if conditions on the ground warrant an extension.
Who says it’s even the president that will set the date? Maybe the choice is in the hands of some faceless, nameless Afghani herdsmen?
The illusion of control is everything right now, in so many ways, both here and abroad.
“Maybe the choice is in the hands of some faceless, nameless Afghani herdsmen?”
Please ’splain…
Well, put another way, unless we want to permanently annex, administer, and govern that country - at some point it’s people will have to step up and do it themselves.
So, the matter of withdrawl is really in their hands, not our POTUS’. OTOH, if they opt to keep resisting, well, we will still be having this conversation in 2020. Of course there are more extreme measures available to pacify a restless nation, but they aren’t anything a democracy would ever consider doing.
“Well, put another way, unless we want to permanently annex, administer, and govern that country - at some point it’s people will have to step up and do it themselves.”
Throughout history, they _have_ stepped up and done it themselves. Unfortunately, time and time again they have chosen provincial warlordism.
And they will choose it again, as soon as we are gone.
Prime_Is_Contained Afghanistan was a monarchy until 1973 after gaining independence from Great Britain in 1919.
This of course was after Great Britain lost the Third Anglo-Afghan war(and of course the First and Second Anglo-Afghan Wars).
Afghanistan was never conquered by Great Britain.
So it was really nice of the British King to grant them independence.
If you are following along, we are currently the 3rd world power in the past 150 to attempt to conquer Afghanistan.
Afghanistan is 4-0 against Great Britain and the USSR.
If you are following along, we are currently the 3rd world power in the past 150 to attempt to conquer Afghanistan.
And that’s the core statistic to keep in mind. The best we can do is a draw, and that’s quite unlikely.
If you are following along, we are currently the 3rd world power in the past 150 to attempt to conquer Afghanistan.
Three’s a charm!
And I hope we win, because we’re gonna need a place to crash after China forecloses on our US crib.
According to Wikipedia politics in Afghanistan haven’t changed much:
Governor-General of India Lord Auckland issued the Simla Manifesto in October 1838, setting forth the necessary reasons for British intervention in Afghanistan. The manifesto stated that in order to ensure the welfare of India, the British must have a trustworthy ally on India’s western frontier. The official British position that their troops were merely supporting Shah Shuja’s small army in retaking what was once his throne was generally seen (at the time, as well as now) as pretext for incorporating Afghanistan into the British empire. Although the Simla Manifesto stated that British troops would be withdrawn as soon as Shuja was installed in Kabul, Shuja’s rule depended entirely on British arms to suppress rebellion and on British funds to buy the support of tribal chiefs. The British denied that they were invading Afghanistan, instead claiming they were merely supporting its legitimate Shuja government “against foreign interference and factious opposition”
“…because we’re gonna need a place to crash…”
I can see it now — Afghanistan ski resorts complete with condo developments near the ski areas. Developers are going to get rich, rich, rich!!!
Who’s that jumping up & down, yelling, screaming in the background?
What do they mean: “I want him to fail!” & “He’s not Hawaiian ?
Mortgage applications edge higher, rates hit 6 month low.
NEW YORK (Reuters) - U.S. mortgage applications nudged higher last week, data from an industry group reported on Wednesday, as consumers showed a subdued reaction to the lowest interest rates in six months.
The Mortgage Bankers Association said interest rates on 30-year fixed-rate mortgages, the most widely used loan, fell for a sixth straight week, remaining below the 5 percent level, widely viewed as a psychological tipping point.
Attractive rates coupled with high affordability have been positives for the U.S. housing market, which has been showing signs of stabilization. Sales have surged in recent months as buyers scrambled to take advantage of the government’s first-time home buyer tax credit.
Michael Moskowitz, president of Equity Now, a direct lender based in New York City and licensed in 11 states, said home loan demand at his company has jumped 20 percent over the past month, but also noted a lot of caution on behalf of consumers.
“Buyers are tentative, however, and seem to need to think hard before moving ahead with a refinancing,” he said.
“Earlier this year, borrowers were more active and willing to say ‘I’ll take it’ more quickly,” he said. “Now, they are tentative.”
Mortgage bankers are waving the rate bait again. Don’t they ever tire?
I think the year end buying surge has run out of steam regardless of how low the interest rate is.
Iran has released the five British sailors it detained last week after their racing yacht strayed into Iranian waters:
By Huma Yusuf posted December 02, 2009 csmonitor
Big Balls Iran Dictators must have reviewed a video of “The Falkland Wars”
That story was as fishy as the Finnish fisherman that accidentally drifted into Iranian waters a couple of years ago.
Dylan Raigan of Morning Meeting just said in essence that the Goldman’ executives want gun permits now to protect themselves .
When you think about it ,that is what eventually happens when you rip off the public to much ,you have to worry about revolt or a angry nut cake citizen who lost their shirt who feels they have nothing to loose .
The Drug Cartel ends up building big mansions with big walls and gunman security to protect themselves ,to the point where you have to wonder
who is in jail .
The point is ,if you end up ripping off your fellow man you have to increasingly isolate yourself from your fellow man or have your back covered 24/7 . This is a interesting concept that unbridled greed ends up
jailing yourself ,even if your avoid redress from the Justice System .
Don’t worry: In New Future, the rich will have their guarded villas, protected by Blackwater. The rest of us will have dung huts, and that’s just the way the rich want it.
Goldman execs all scared. Too funny.
If someone starts popping them, they won’t have a chance to fire back.
What happens when a nation revalues its currency practically overnight? A mad scramble to get rid of hoarded currency.
Could it ever happen here? Almost everyone will say “No!” We’ll go out on a limb as say not only could it happen here one day, but probably will.
Here’s how the money game is playing in North Korea this week:
SEOUL, South Korea – North Korea has revalued its national currency for the first time in decades in a bid to fight inflation and flush out the black market money trade - a move that sent residents of the communist state scrambling to convert hoarded money into foreign currencies.
North Korea revalued its currency at an exchange rate between old and new notes of 100 to 1. The exchange of old notes started Monday and will continue until Sunday.
http://news.yahoo.com/s/ap/20091201/ap_on_bi_ge/as_nkorea_currency_reform
“…a move that sent residents of the communist state scrambling to…”
…figure out an unseen way to get rid of their sick bast@rd President kim-long-ill
Following up on the conversation yesterday (and days past) about somehow using energy as money - I posted this late last night, figured I’d repost. A statement was made:
I have yet to see anyone explain why it wouldn’t make sense.
My response:
Simply put - logistics. You just can’t get around the huge logistics problems.
- How does an average Joe accurately measure their holdings? It’s not easy for even scientists to measure “energy”, let alone someone with little to no lab equipment.
- How does one account for energy that’s stored in their possessions? I have energy in my house, my trees, my grass, my food, my body etc. If I want to sell some of it - how the F would I go about doing that? If I’m hard up I can’t exactly rip a 2×4 out of my house to pay the grocer. Maybe I could punch the checkout clerk in the face? There’s your payment - 1,000 joules worth. Sorry it kind of hurt.
- Just think about how such a system would be inherently imbalanced. Instantly any entity (e.g. energy companies) that have access to nuclear power now own 99.9999% of the world’s wealth.
etc. etc. The problems with such a system would be endless.
It’s an interesting thought experiment - nothing more.
A viable money system has to have these characteristics:
1. Easily measurable
2. Easily storable
3. Easily exchangeable
4. Of limited supply
5. Not easily creatable
6. Not easily counterfeited
Fiat money systems meet 1-3 and can meet 6, with 4-5 questionable.
PM money systems meet 2-6, with 1 questionable. Combination PM-backed paper and real PM can meet all 6 very thoroughly.
An energy-based system would perhaps meet #5, if you don’t count nuclear as “creating” energy. It doesn’t come close to meeting any of the other ones.
“A viable money system has to have these characteristics:
1. Easily measurable
2. Easily storable
3. Easily exchangeable
4. Of limited supply
5. Not easily creatable
6. Not easily counterfeited”
Thank you. I was too lazy to post the definition of money.
And the best method to keep “others” hands off your stack…pain, lots of pain.
When you say money, I guess you mean currency. The currency material also can’t degrade. Which is why gold and silver are so popular. They don’t corrode.
The requirements are a little different in a barter system.
When you say money, I guess you mean currency. The currency material also can’t degrade. Which is why gold and silver are so popular. They don’t corrode.
Yep - forgot about that one; however a full description would be:
7. Either cannot degrade easily, or can be traded to source for like-new
(latter applies to US$ paper bills, however not Korean Won these days, at least in significant quantity!)
The requirements are a little different in a barter system.
Well, in a barter system money isn’t actually used. “Money” being defined as something that can be exchanged for goods and services, that isn’t a good or service itself.
Thank you. I was too lazy to post the definition of money.
Yes. The definition of money.
Not the definition of the value of money. Which is a much more intangible thing.
Dollars are not valued in gold. For the average person, dollars are valued in a gallon of gas, a bag of groceries or a month of shelter.
I’d say a gallon of unleaded gasoline is a hell of a lot better measure of the value of the money in your pocket than 1/600th of an ounce of gold.
I know I can be dense, but what am I missing here?
You can’t eat gold, you can’t burn it or live in it. But it takes energy to grow food, build houses and ship goods.
What is the problem with agreeing that a gallon of gas is the measure by which all other things will be valued?
The problem is that you’re talking about a thing - energy - which can be consumed, and whose primary function is to be consumed. Consumables aren’t good to be used for money. (This is kinda sorta true for gold and silver, which are technically consumable (used in electronics etc.), however only a small percentage of that in existence is needed as such.)
Someone may have 100 gallons of gas, and thus the equivalent amount of money - but what happens when they want to burn that gas? Just the act of driving down the street causes them to lose money. This isn’t true for other forms of money. You should only lose money (in nominal terms) when you exchange it for goods and services, such that other people then obtain the money that you once had.
Specifically to this question:
What is the problem with agreeing that a gallon of gas is the measure by which all other things will be valued?
What happens then when we run out of gasoline, because it’s all consumed? Is all money then just gone? Is that really feasible?
Sorry, but this is just grasping at straws. There’s not really anything more that can be said about it - if you can’t see that it’s simply not feasible to use energy as money, or even as a representative of money, then it’s because you’ve completely closed your mind to all counter-arguments.
What is the problem with agreeing that a gallon of gas is the measure by which all other things will be valued?
What happens then when we run out of gasoline, because it’s all consumed? Is all money then just gone? Is that really
feasible?
Except that energy cannot be destroyed.
I thought maybe a gallon of gas would be more illustrative than a kw.
Sorry for the confusion, and thanks for the attempts to help me understand. I’m not trying to be difficult here - I’m just trying to understand why something that is so incredibly necessary for modern life - energy - cannot be used to assess value.
Someone may have 100 gallons of gas, and thus the equivalent amount of money - but what happens when they want to burn that gas? Just the act of driving down the street causes them to lose money.
And I think you’re missing the point - I don’t think we should be trading energy for things, I think we could use energy to put a value on things. A real-world value as opposed to the rather inconstant value of something like gold.
A gallon of gas has a lot more energy in it than a Van Gogh painting - but the latter has a lot more value.
I think the main thing that’s just irreconcilable is the inconsistency of forms of energy. It can take on thousands of different forms - different densities, different materials, different extraction methods, etc. etc. Therefore it’s simply not feasible to actually use energy as currency itself - it’s just too hard to measure, and too variable in it’s nature, compared with dollars, ounces of gold, etc.
So therefore you would have to create something to represent the value of energy - some kind of certificates - and trade those instead. Then however we’re talking back to paper money. The plus is that it now has a real base. However the problem is that the size of the base is a huge unknown, and is changing all the time. How many joules exist in the U.S.? It changes constantly as we tap energy sources - solar, oil, geothermal. Geothermal is actually by far the most vast source of energy on earth - problem is the extraction. However if you’re basing you rmoney supply on it - does it need to be extracted? It shouldn’t, since it couldn’t actually be used for trading.
So - once again - how do you:
A. Come close to accurately measuring the amount of energy a given entity - a country, a person, a company, etc. - holds?
B. Possibly take initial possession of such holdings in a reasonably fair manner?
Instantly Russia would be the richest country in the world, simply because it has the largest land area and therefore the largest claim to geothermal energy (from the surface to the core of the earth).
Is that fair though - since the U.S. produces way more stuff than Russia does? Obviously no.
Except that energy cannot be destroyed.
BTW - sure it can. E=MC2 and all that. Perhaps not “destroyed” in that case, but merely exchanged for mass. However now you’d have to include mass as money. Michael Moore’s already rich enough without that happening. Let’s not penalize the little people.
“…dollars are valued in a gallon of gas, a bag of groceries or a month of shelter.
A bag a grocery may feed your hunger for a few days…but a $1.00 condom can keep a person & their hunger… alive!
Run Hwy, …RUN!
Because while the finished gasoline is fungible, crude oil is not. Sour crude is more expensive to extract and refine than sweet crude. Oil sand crude is more expensive than sour crude, etc.
Using gasoline as currency is still viable even when we run out of gasoline. When supply goes to 0, theoretically the price of gas goes to infinity. There are many movies — The Road Warrior being the most familiar — based on that scenario.
And The Road Warrior is a desirable scenario because…?
No, I mean the theory of using gasoline as currency is valid because its price rises as it becomes scarce. However, it doesn’t much match the rest of the criteria for currency.
“What is the problem with agreeing that a gallon of gas is the measure by which all other things will be valued?”
The same problem as agreeing buggy whips were the measure by which to value all other things circa 1920.
The same problem as agreeing buggy whips were the measure by which to value all other things circa 1920.
As I mentioned, I thought a gallon of gas was a more example than a kw.
Sorry for the confusion.
We’ll always need energy, not so much buggy whips.
I would add that the choice for a medium of exchange should not provide an incentive to dig up, pump out and burn down every square centimeter of the planet just as fast as humanly possible.
I propose that the best commodity to use is sunshine. No one can hoard it. Our fortunes will all rise and fall together and the boom/depression schedule will be right on the calendar.
Moonshine for the small change.
This is my plan anyway.
Seattle residents may have something to say about that plan.
I like the moonshine idea though.
Ya can’t put sunshine in a safe deposit box. Now moonshine might be an entirely different story…
“Ya can’t put sunshine in a safe deposit box”
That’s a lie! Yes you can. Just don’t open it in the dark or it will go poof faster than a subprime MBS.
You must believe in the particle theory of energy, as opposed to the wave theory?
Particle obviously, even though wave theory works really well at predicting certain behaviors.
The point is that the light is in there as long as you believe me, if you look for it too bad. That’s what money is like, isn’t it?
“…the light is in there as long as you believe me…”
I personally believe the bank vault contains nothing but a dead cat.
You can’t put gold or dollars in a safe deposit box with any certainty as to their value when recovered either.
Depends on how you define “certainty”, “value”, and “when”.
I have somewhat above a 99% degree of certainty that if I put a $20 bill in my safe deposit box today that its value will be worth about an average dinner meal if I take it out next week.
Extend the timeframe, and the certainty goes down - asymptotically approaching zero.
Get more specific on the “value” (X gallons of gas) and the certainty goes down, asymptotically approaching zero as you get more specific (X gallons of super, at a specific gas station).
Extend the timeframe, and the certainty goes down - asymptotically approaching zero.
Except for when it suddenly becomes ancient and “historic” and its value then rises.
In the year 3518, you’ll be able to buy enough energy to power your spaceship for several hundred lightyears with that $20 bill.
Well - except many 2,000-year-old Roman coins are still only worth a few hundred dollars or so. On eBay in fact I see a lot of 10 coins for $22.95.
I doubt a $20 bill will be worth much in historical value 1,500 years from now.
1. Easily measurable So a kWh changes over time?
2. Easily storable Oil reserves, coal reserves, uranium reserves.
3. Easily exchangeable Grid.
4. Of limited supply Subject to efficiency of conversion.
5. Not easily creatable Same as #4
6. Not easily counterfeited. Energy is energy, no matter what form, it can neither be created nor destroyed but can only transfer from one form to another, or as per Einstein, into matter.
“…it can neither be created nor destroyed”
Hey, can it be “stretched”?
Besides, the way you really need to look at this as whether or not it would set a range limit on currency devaluation. If some enterpising soul wishes to charge me 1000kWh for something that cost him 100kWh to produce, all in, then I can accept or reject that. The difference between that situation and our present currency is that one can’t really set any limit on what something costs to produce. It costs “what the market will bear”.
I agree this will never happen, but just becasue something never will happen doesn’t mean it shouldn’t.
Simply put - logistics. You just can’t get around the huge logistics problems.
- How does an average Joe accurately measure their holdings? It’s not easy for even scientists to measure “energy”, let alone someone with little to no lab equipment.
- How does one account for energy that’s stored in their possessions? I have energy in my house, my trees, my grass, my food, my body etc. If I want to sell some of it - how the F would I go about doing that? If I’m hard up I can’t exactly rip a 2×4 out of my house to pay the grocer. Maybe I could punch the checkout clerk in the face? There’s your payment - 1,000 joules worth. Sorry it kind of hurt.
If Joe liquidates his holdings, how much gas (energy) can he buy with the money?
- Just think about how such a system would be inherently imbalanced. Instantly any entity (e.g. energy companies) that have access to nuclear power now own 99.9999% of the world’s wealth.
If there were one global energy company, well yes. But that’s generally known as a monopoly, no?
etc. etc. The problems with such a system would be endless.
I think we’re already there and we just don’t know it. Almost every time someone around here mentions using gold to weather financial tough times, someone else mentions the value of toilet paper or ammo. You can’t make either with gold, but having a generator and some gasoline can sure help run the machines that can.
It’s an interesting thought experiment - nothing more.
Perhaps. As dude mentioned, it’s just “tilting at turbines.”
A viable money system has to have these characteristics:
I’m not proposing doing away with paper money.
You people are WAY overthinking this thing. You can make money TODAY from energy.
Install solar/wind on your house. Store a few days of electricity in batteries for future personal use. Sell excess electricity back to power company.
This is done all the time every day right now.
A banker is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain.
–Mark Twain–
So what does a banker do when tornado warnings have been issued around the globe?
–Professor Bear–
“Clearly, banks are not making as many loans right now because many are still reeling from the credit crisis and need to rebuild their capital reserves in case of future turbulence. The recent debt scare in Dubai demonstrates that globally there are still challenges ahead. Renowned bank analyst Dick Bove of Rochdale Securities said that, while U.S. institution’s exposure to Dubai is minimal, the situation does show that the worst of the global credit crisis may not be behind us. Again in an interview on CNBC, Bove opined that if Dubai can default on its loans, what is to stop other troubled nations from doing the same thing? Furthermore, he discussed the increasingly likely prospect that U.S. bank regulators will increase capital requirements in the coming months. Out of the 30 largest banks by assets, only four — Citibank (C), State Street (STT), Northern Trust (NTRS) and First Horizon National (FHN) would be able to meet the proposed 12% capital ratio without needing to raise fresh capital.”
Take it from one of history’s worst debt beats and former capitalist icon, now turned communist: Banks should be forced by the government to lend more.
Banks Are Not Lending? So What
By Ockham Research|Dec 1, 2009, 3:39 PM|Author’s Website
Much has been made about the fact that economy-wide bank lending is down considerably despite the fact that the stock market and other economic indicators have begun to improve. Even after the unprecedented cash made available by the Federal Reserve and direct bailouts from the Federal government, some estimates state that bank lending is still down some $600 billion from this time a year ago. This has created widespread frustrations which became apparent in an interview with real estate mogul Donald Trump this morning on CNBC. In that interview, Trump argued that the economy cannot heal until we have a fully functioning credit market and even suggested that perhaps the government should force banks to lend more.
…
“perhaps the government should force banks to lend more”.
Trump sounds like a Cesar Chavez parrot, not like a capitalist.
I still think my idea will happen:
Lower my CC balance by $1-2000 and lower the interest rate to say 2% for 5 years.. multiply that by 100 million cards and you have an immediate stimulus…..and not targeted to certain privileged groups aka cash for clunkers.
dj,
Stimulatin you (and me) is the last thing on the dance card.
LOL yup sure is….but if any of the cards jack up my rates to 24% before the new law takes effect ..i will walk on them….
Never had a late payment or over limit fee since i got my first card in 81…that should mean something….like i am an idiot for being responsible and deserve to be punished.
Wait a dang minute. I don’t carry CC balances, so what do I get? Maybe a prepaid debit card with a $2000 balance? Katrinaesque, I think.
I promise I will spend it very quickly and very friviously. I swear I won’t save it or use it for essentials. I promise. Wink, Wink.
Many people either don’t have or don’t use credit cards. Younger people especially, use debit cards only.
Many people who DO have a credit card don’t carry a credit balance on it.
People who carry over a balance from month-to-month tend to be the same people who get in trouble with other loans. So we’re supposed to subsidize them AGAIN?
“Trump sounds like a Cesar Chavez parrot, not like a capitalist.”
Haven’t you figured out that we have socialism for the rich and capitalism for the poor?
Banks should lend. Debtors should walk-away. The authorities should enable both.
“perhaps the government should force banks to lend more.”
Perhaps the government should force Trump to bend over and squeal like a pig as his assets are seized and auctioned off.
After all, it’s only money, right, hairball?
sTrump…Modern American Hero!
Emulate him kids, EMULATE! (oh, and buy his “strategy” via tapes & books)
Funniest thing ever. Trump seminar in Norfolk VA. Some $1200+ a seat. All these huckster wannabes stand in line, pay their dues, and it turns out to be a video recording. Interviews with them afterwards had them sad because they thought they could get close to “The Donald” and what not, but were still happy to hear his advice. Sore butts after that one, I’m sure. If I were there, I’d say, “Why not dispute it with your credit card company if it was falsely advertised.”
seminars…dang I nearly forgot about those, last ones I went to was undercover for my Philosophy professor in the ’70’s…Scientology & EST…thus seminars always remind me of “TrueBeliever™”/ “TrueDeceiver’s™” “CULTS”
The Grand Battle has begun: Now that the Precious Metals market is going parabolic the only thing that can stop it is the long term bond market. Sure the FED says they don’t watch gold prices but I predict that will be the tipping point for a rate increase, not the unemployment rate. I’m going to guess gold hits $1600 before they cry uncle and raise rates by .5 or .75 percent in a surprise rate hike, timed of course for maximum impact like during next market crises. The next six months will exciting!
Sovereign default or devaluation risks reflected in the precious. It’s already here.
Blue, do you really see a parabola?
Well considering the time frames, yes. On a 2-3 month window gold and silver are really steep and on a 6 month scale for almost all other liquid assets like stocks. At some point there will be a show-down so the suspense just keeps building.
Silver isn’t even up to where it was last August, which is why I’m not seeing parabolas (yet).
I’m surprised, if it is the case, that the Dubai World default thing is driving up the price of gold. If the Dubai government (or whoever prints money over in the UAR) were to pledge to run the printing press to make good on the loans, then I could see it driving up gold. The Dubai government rather refuses to make good, which should be deflationary.
The Fed should (secretly) welcome a Congressional audit, as it would provide a convenient excuse should future inflation turn out to be “higher than expected.”
Congressional pressure
Congress has so far sensibly put this off limits. “Audit” has a different meaning in the context of the GAO than in everyday usage. It means examine, investigate, evaluate and, often, criticize. It’s not just number-crunching. The GAO usually undertakes studies at the request of someone in Congress. This suggests that the GAO could be used to influence or intimidate the Fed through selective investigations. Historically, similar pressures have caused other central banks to unleash inflationary torrents of money.
Gold is the best investment, and the best holiday gift, to boot.
Dec. 1, 2009, 12:01 a.m. EST
Striking gold
Commentary: Investing in stock or jewelry this holiday season
Related stories
* Gold hits new record above $1,217 an ounce (9:34a)
* Geithner defends derivative oversight plan (10:14a)
* Forget the market and focus on loved ones (12:56a)
* Tiger Woods should ask media for a mulligan (12:01a)
By Dan Greenshields
SEATTLE (MarketWatch) — Holiday shopping have you in a quandary? Having trouble deciding on that perfect gift? Think gold.
It could make the shopping season a bit easier. Whether you choose gold jewelry or the gift of gold in the form of stock, gold is a truly precious metal and there are some things you need to know before you head off to the investment mine.
…
Ha, I saw a “GOLD ETF” gift card hanging above the candy bar rack at the grocery store last night,…right there next to StarMucks & Home Despot cards.
Cool idea, except $25 won’t buy you much gold.
But it used to…
but,but,but…I’ve heard that even just a speck makes you feel all warm & fuzzy inside. Hey, it’s almost Christmas, shiny things are hip. (even silver shiny things)
The less weight of gold you buy, the more difficult it becomes to weigh it properly in order to determine whether you accidentally purchased platinum by mistake.
Hilarious comment in response to the story posted below:
“Dubai — No. 101 on my list of Top 100
places to visit before I die.” — Dow20000
Nov. 30, 2009, 4:36 p.m. EST
Dubai tourism already defaulting
Economic downturn, overcapacity bite into once-hot travel destination
By William Spain, MarketWatch
CHICAGO (MarketWatch) — With its massive residential, commercial and leisure developments built on oil revenue (and, as it turns out, a foundation of shaky debt), Dubai has been steadily modeling itself for more than a decade into an upscale tourist destination and a regional entrepot for those people and companies looking to do business in the Persian Gulf region.
Already pressured by the global economic downturn, its success could be in further danger as Dubai World, the emirate’s investment and holding arm, teeters on the edge of defaulting on $60 billion worth of debt. Those IOUs piled up during its relentless expansion of domestic and foreign investments, largely in real estate.
…
A place that piled sand on top of more sand and people thought it was a great investment.
* The Wall Street Journal
* DECEMBER 2, 2009
Fed Debates New Role: Bubble Fighter
By JON HILSENRATH
Not so long ago, Federal Reserve officials were confident they knew what to do when they saw bubbles building in prices of stocks, houses or other assets: Nothing.
Now, as Fed Chairman Ben Bernanke faces a confirmation hearing Thursday on a second four-year term, he and others at the central bank are rethinking the hands-off approach they’ve followed over the past decade. On the heels of a burst housing-and-credit bubble, Mr. Bernanke now calls financial booms “perhaps the most difficult problem for monetary policy this decade.”
…
I recommend a hands-on approach to dealing with bubbles: If you notice a bubble is bursting, reflate it with all your might.
They did nothing because they did not see the bubbles coming (per their own omissions) … they are so involved in creating a proper political environment than actually caring about the fiscal security of the country. They have no problem using crazy schemes to ensure “full employment” while ignoring the basic rights such as protection of property or liberty.
The FED is more than a faction it is a cabal … looking after its international interests and poof profits rather than the interests it has a fiduciary duty to protect.
This country hasn’t seen “full employment” since the 1960s. UE was 4.9 by the old measurement.
And yes, they are a cabal.
It seems realtors are back to the great days… I have a friend who used to be an engineer, but quit about 10 years ago to become a realtor.
Anyhow, he’s having contracts left and right… he just got back from Europe 3 weeks ago, came back to the US to close some real estate transactions, and is using his comission to go back to Europe with his wife for Christmas and New Years.
I really really hate these bastards… they get paid 3% comission for every house the sale… the ‘tax’ stimulus money for new homebuyers are allowing real estate agents to pile up ridiculouos amounts of money for little work.
On the other hand, every other ‘normal’ person has to work a M through F, 8 am to 6 pm job to get a paycheck.
Talk to my wife (RE agent mid ’80s to mid ’90s) about working on commission. Regular hours? Hah! It was usually feast or famine when it came to clients and listings, and when a “feast” peak came along she didn’t work 24/7 but certainly 12/7. Those are the years where I learned to cook more than just a few basic things as the late afternoon call, “Honey, can you fix dinner for the kids and yourself?” came relatively frequently.
Her added income put three of our kids through college without us or them going into debt. She was glad to give it up when she did.
Brett, your friend is either A) very lucky or B) spending every dollar he makes as soon as it hits his pocket.
My BIL is a realtor and he isn’t seeing nearly enough uptick in closings to keep his family afloat. Of course, he does live in Florida…:roll:
that was supposed to be
I could never be a Realtor. About the first time I spent a couple of days showing people around house after house and they decided “to wait a while” or to buy a FSBO, I would be going for the throat. I think that violates the code of ethics.
Not Enough Time To Properly Cook The Books???
From John Williams Shadow Stats today:
Release of GAAP-Based 2009 Financial Statements of the United States Government Delayed. With no related formal announcement that I can find, the U.S. Treasury has posted on its Web site, http://www.fms.treas.gov/fr/index.html, that the 2009 GAAP-based U.S. Government financial statements — mandated by Congress — will not be published until February 2010. They had been scheduled initially for release in mid-December 2009.
My estimate remains that full GAAP-based accounting will show the actual 2009 annual deficit to be about $8.8 trillion, up from $5.1 trillion in 2008. Those details will be found in the updated hyperinflation report. While there certainly have been a number of complicating events for the government’s accountants to assess in the last year, having accurate and timely information this month would be useful to those debating current conditions and issues. Delayed until February, any unhappy accounting results may not surface now until after the health care package and related fiscal concerns have been put to bed by Congress and the Administration.
Delaying the report and debating the health care bill are totally unrelated. Williams shouldn’t jump to such conclusions.
/sarcasm off
$8.8 Trillion? Based on what? That’s a very far cry from the published $1.4 Trillion.
And 2008’s deficit was about $450 Billion, not $5.5 Billion.
“$8.8 Trillion? Based on what? That’s a very far cry from the published $1.4 Trillion.
And 2008’s deficit was about $450 Billion, not $5.5 Billion.”
Based upon “Full GAAP accounting” which is to say, the current accrued portion of all unfunded liabilities ALONG WITH the current account cash deficit. See below:
“Nearly four decades ago, President Lyndon Johnson’s political sensitivities led him and the Congress to slough off some of the costs of an escalating Vietnam War through the use of accounting gimmicks. To mask the rapid growth in the federal government’s budget deficit, revenues from the surplus being generated by Social Security taxes were added into the general cash fund, without making any accounting allowance for the accompanying and increasing Social Security liabilities. This accounting-gimmicked reporting was dubbed “unified” budget accounting.
The government’s accounting then, as it is now, was on a cash basis, reflecting cash revenues versus cash expenditures. There were no accruals made for monies owed by or due to the government at some time in the future.
The bogus accounting understated the actual deficit for decades and even allowed for claims of budget surpluses in the years 1998 to 2001. While there were extensive self-congratulatory comments between the President, Congress and the Fed Chairman, at the time, all involved knew there never were any actual budget surpluses. There hasn’t been an actual balanced budget, let alone a surplus, since before Johnson and his cronies cooked the bookkeeping.
The doctored fiscal reporting complemented the short-term political interests of both major political parties. Additionally, the ignorance and/or complicity of Pollyannaish analysts on Wall Street and in the financial media-eager to discourage negative market activity-helped to keep the fiscal crisis from arousing significant concern among a dumbed-down U.S. populace.”
This is confusing to me. I keep a budget like a good spreadsheet geek. Every entry ripples through the weeks and months to show me what my surplus is expected to be at the end of the year or a decade down the road.
Future liabilities are not subtracted from this year’s net. They are subtracted from future year’s net.
Social Security for those coming after Generation Greed are not a real liability. That’s what the law says. They cut the progressive income tax and raised the regressive (and not paid by retirees) payroll tax in 1983 to “save Social Security.” They took that money too.
Younger generations will finish their years in ill health and poverty, a much larger share of whatever income they can muster going to taxes to pay for Generation Greed’s debts.
Social Security for those coming after Generation Greed are not a real liability. That’s what the law says. They cut the progressive income tax and raised the regressive (and not paid by retirees) payroll tax in 1983 to “save Social Security.” They took that money too.
Cutting taxes though doesn’t decrease liability - it increases it.
I think “that’s what the law says” is cobalt’s point - the law says these aren’t liabilities - at least with regards to the FedGuv, however GAAP says they should be. (Though I’m not an accountant, so am not certain of that myself)
“Future generations” WT Economist?
Try now.
Will it get worse? Of course. Since less than 25% of today’s workforce has pensions, there is no fallback position for the rest.
Hmm - is Williams then stating that in 2009 we had an increase in unfunded liabilities of $7+ trillion? I get where your coming from - but that still sounds incredible. Perhaps it’s feasible though.
I’m guessing where that’s coming from is things like Social Security and Medicare, who have a lot of their balances invested in U.S. Treasuries. Since treasury yields have been going way down - that means the anticipated gains from these investments (and therefore the book value?) went down as well. In a normal GAAP scenario at some point the book value would be written off.
However the reverse is also true. If/when the treasury rates start going up (as they did 2004-2007; albeit slowly) - then this would contribute towards a GAAP budget surplus.
Wait until first quarter next year…
Credit-card delinquencies near record high: Fitch
BOSTON (MarketWatch) — Fitch Ratings on Wednesday said late payments on credit cards rose again in November and are close to setting record highs as consumers continue to struggle to pay off debt in a weak job market. Payments that are late by at least 60 days rose to 4.41% in November. Late-stage delinquencies are 31% higher than a year ago and just below the record high of 4.45% set in June, the ratings agency said. “Credit-card delinquencies are on the rise again and cardholder defaults will retest recent highs as we head into the new year,” said Michael Dean, managing director at Fitch. “Consumer credit quality remains under significant strain as a result of the persistent weakness in the labor markets.”
Credit card rates: Nowhere to go but up
New law will rein in many practices long decried by consumer activists. What it won’t do is keep interest rates, now at a low point, from rising.
WASHINGTON (CNNMoney.com) — For millions of credit card customers, here’s the good news: As of Feb. 22, a new law will bar banks from a host of practices that consumer advocates have long blasted as unfair.
No more rate hikes based on, say, the late payment of a cell phone bill. No more increases on existing balances. And consumers will know how long it takes to pay off their balance when they make minimum payments.
But here’s what the new law won’t do: It won’t prevent interest rates from going up for the vast majority of customers.
Even after Feb. 22, holders of so-called variable-rate cards can expect to see increases. Variable rates are based on the prime rate and meant to follow the rise and fall of that index.
The problem for consumers is that the prime rate is at 3.25%, an historic low. It will almost certainly go up, experts say. And so will credit card rates, which currently average 14.9%, according to the Federal Reserve.
On Monday the United States debt bumped up against the statutory ceiling. The country is officially in hock for $12,113,047,538,115.42
Here we go bumping up against that pesky debit ceiling again. We need mo money, look for another trillion soon.
Go dollar!
Who needs the dollar … let’s just replace it with the Euro in the USA.
On Monday the United States debt bumped up against the statutory ceiling. The country is officially in hock for $12,113,047,538,115.42
I got the 42 cents.
Thanks lavi!
the debtclock site does not quite have our debt that high yet. Where did you come up with the number?
Thanks,
Fecaltime!
The horse’s mouth. (Tuesday’s number is actually a bit lower than Monday’s - have to use the history tool to find Tuesday’s)
Whatever is the matter with this “TrueBeliever™”/ “TrueDeceiver’s™” barker motto?
“Drill Here,..Drill Now!”
By Edward Welsch, Dow Jones Newswires:
“We can talk a lot about China and its strong manufacturing data but the U.S. is still the world’s largest energy consumer and it looks like its having a hard time sucking down oil right now,”
BWAHAHHAHAHAHHAHAHHAHHAHAHAHHHHHHHHHHHHH!!! (fpss™)
Right before Thanksgiving AAA said that more people would be driving than last year. But now it is being reported that gasoline usage was down for the week. Meanwhile it costs ~$0.81/gal. more than last year to gas up.
Yet, I suppose it takes a while for GS and others to unwind all those bets they placed on $200 bbl.
It’s reassuring to know that “OIL” (the commodity) is controlled by “Supply & Demand” & “The efficient working of Free Markets” …it keeps eCONomics on solid grounding for Nobel Prize Awards in the “Science” category.
The above is a good example of picking your data point to support your argument. Yes, gasoline is 81 cents higher now than it was 12 months ago, but it’s $1.30 LESS than it was 16 months ago.
It was also less over this summer than it was during the summers of 2006 through 2008.
Go to this site: http://gasbuddy.com/gb_retail_price_chart.aspx
You can create any number of charts going back as far as six years and for the entire U.S. or for just a particular city/region.
In my region, gasoline was less than $1, 6 years ago. It just rose 6 cents and is now at 2.45.
So although the price has fluctuated over the last 6 years, it’s still over 100% more than 6 years ago.
My pay didn’t go up 100% over the same period.
Have you considered becoming a banker?
“TrueBeliever™”/ “TrueDeceiver’s™” Faux News = Free!
WSJ = 1st sentence = Free
“…after Rupert Murdoch and others accused it of profiting from their news.”
BWAHAHHAHAHAHHAHAHHAHHAHAHAHHHHHHHHHHHHH!!! (fpss™)
Dec 2 2009, 10:36 am by Derek Thompson
As Murdoch Fusses, Google Vows to Limit Free News
So if Google drops all of Rupert’s news feeds that would leave, what? Only the rest of the world right?
Morgan Stanley fears UK sovereign debt crisis in 2010
UK
Britain risks becoming the first country in the G10 bloc of major economies to risk capital flight and a full-blown debt crisis over coming months, according to a client note by Morgan Stanley.
The US investment bank said there is a danger Britain’s toxic mix of problems will come to a head as soon as next year, triggered by fears that Westminster may prove unable to restore fiscal credibility.
“Growing fears over a hung parliament would likely weigh on both the currency and gilt yields as it would represent something of a leap into the unknown, and would increase the probability that some of the rating agencies remove the UK’s AAA status,” said the report, written by the bank’s European investment team of Ronan Carr, Teun Draaisma, and Graham Secker.
Why Dick Cheney Should Run in 2012!
Published Nov 28, 2009 Jon Meacham
From the magazine issue dated Dec 7, 2009
Palin/Jeb
Cheney/Palin
Palin/Coulter
Cheney/Jeb
Reminds me of line by Red Skelton:
“I hope I live long enough to see who gets Brooke Shields…”
“A Great Collapse - A Hyperinflationary Great Depression”
Not exactly what Eddie looks for.
A summary of John William’s Shadow Stats latest bulletin emailed to subscribers 20 minutes ago:
Overview
A Great Collapse. The U.S. economic and systemic solvency crises of the last two years are just precursors to a Great Collapse: a hyperinflationary great depression. Such will reflect a complete collapse in the purchasing power of the U.S. dollar, a collapse in the normal stream of U.S. commercial and economic activity, a collapse in the U.S. financial system as we know it, and a likely realignment of the U.S. political environment. The current U.S. financial markets, financial system and economy remain highly unstable and vulnerable to unexpected shocks. The Federal Reserve is dedicated to preventing deflation, to debasing the U.S. dollar. The results of those efforts are being seen in tentative selling pressures against the U.S. currency and in the rallying price of gold.
Crises Brewed by Federal Government and Federal Reserve Malfeasance. The crises have been generated out of and are centered on the United States financial system, triggered by the collapse of debt excesses actively encouraged by the Greenspan Federal Reserve. Recognizing that the U.S. economy was sagging under the weight of structural changes created by government trade, regulatory and social policies — policies that limited real consumer income growth — Mr. Greenspan played along with the political and banking systems. He made policy decisions to steal economic activity from the future, fueling economic growth of the last decade largely through debt expansion.
The Greenspan Fed pushed for ever-greater systemic leverage, including the happy acceptance of new financial products, which included instruments of mis-packaged lending risks, designed for consumption by global entities that openly did not understand the nature of the risks being taken. Complicit in this broad malfeasance was the U.S. government, including both major political parties in successive Administrations and Congresses.
Economic activity has sunk to such lows that regular measures of change that are followed closely by the financial markets — such as new claims for unemployment insurance — are not signaling economic recovery, as they turn less negative, only that activity is beginning to plateau at an unusually low level. With stimulus packages having had their initial impacts, with broad domestic liquidity (see money supply discussion) contracting at a pace that would promise an economic downturn in the best of times, and with consumers’ liquidity problems intensifying, the contraction in U.S. economic activity likely will accelerate anew in the early months of 2010.
“The U.S. economic and systemic solvency crises of the last two years are just precursors to a Great Collapse: a hyperinflationary great depression.”
We’re too interconnected with the world to have runaway inflation; we rely on outsiders for our borrowing. As commercial real estate holdings are forced to “mark to market” valuation and the second wave of mortgage resets gets underway in earnest next spring the large bond holders (mainly insurance companies) won’t be “made whole” as they were when the first shoe dropped, and this will increase the cost of money. The “next shoe to drop” will be the result of widespread business and personal debt defaults due to rising interest rates.
So the Fed hasn’t been adding Treasury debt to its balance sheet? Until QE stops I will be hard to believe we a face a deflationary environment.
Is there a difference if the fed buys a $1-trillion of bad debt, or the treasury prints a $1-trillion and distributes it as a stimulus?
No. One is inflationary, the other is anti-deflationary; both have the same effect.
People pay $175 a year for this junk?
“People pay $175 a year for this junk?”
Sort of like church, Lad; if it costs you money it must be true.
CLIMATE CHANGE ‘FRAUD’
~ UK NEWS 12-2-09
If you have to argue your science by using fraud, your science is not valid. ~ Professor Pilmer
THE scientific consensus that mankind has caused climate change was rocked yesterday as a leading academic called it a “load of hot air underpinned by fraud”.
Professor Ian Plimer condemned the climate change lobby as “climate comrades” keeping the “gravy train” going.
In a controversial talk just days before the start of a climate summit attended by world leaders in Copenhagen, Prof Plimer said Governments were treating the public like “fools” and using climate change to increase taxes.
He said carbon dioxide has had no impact on temperature and that recent warming was part of the natural cycle of climate stretching over billions of years.
Prof Plimer - author of Heaven and Earth: Global Warming, The Missing Science - told a London audience: “Climates always change. They always have and they always will. They are driven by a number of factors that are random and cyclical.”
The skeptics are having a pile on party.
This idiot is no more a “scientist” than those he is groin kicking. Failure to prove something does not disprove it.
Is there anyone anywhere in the world who passed Logic 101?
Amen!
If you blow CO2 into the atmosphere you are getting some kind of greenhouse effect. That’s just science 101. How big that effect is, that’s what’s up for debate. There’re also a bunch of other factors (Earth’s orbit, sun spots, moon, continental drift, volcanic erruptions, tilt of Earth’s axis, etc.) that influence the climate to some degree.
So you have a bunch of variables that are out of man’s control and one (greenhouse gases) that is somewhat under man’s control. That means:
1. short term (like in decades) fluctuations are normal. So some warming/cooling trend over one or two decades doesn’t prove or disprove anything.
2. long term effects…well, that’s we would like to find out. Maybe they are negliable maybe they’re not. The truth is nobody really knows right now. By falsifying data and having some childish debate about the topic we’ll find out the hard way.
“…So you have a bunch of variables that are out of man’s control…”
Of course the planets dying… the “Long Term Capital” question of the day is:
1. When do we “all” get ready to leave?
2. Where are we “all” headin’ too?
3. How much gold & cash do we need? (Oh, silly me, which currency?)
(Hwy wonders if there’s gonna be room for his Diogenes replica bathtub?)
Prof Plimer - author of Heaven and Earth: Global Warming, The Missing Science
Hey, at least he’s talking his book.
I don’t mean to politicize this but one thing I’ve noticed recently is that several left-leaning radio show hosts claim to have not heard about the email scandal.
While I find the timing of the scandal curious, given the meetings next week, I find it hard to believe these folks haven’t heard a peep about it.
From wikipedia
Plimer is a director of three Australian mining companies: Ivanhoe, CBH Resources and Kefi Minerals.Plimer rejects claims of a conflict between his commercial mining interests and his view that man-made climate change is a myth. Plimer has said that the proposed Australian carbon-trading scheme could decimate the Australian mining industry, and probably destroy it totally, as well as creating massive unemployment
Seems Mr. Plimer has a bit of conflict of interest.
Gas station rules may hurt families, but could help investors
By Yudislaidy Fernandez ~ Miami
Gas station owners say those unable to get financing to meet new Florida environmental rules have their hands tied, many are preparing to shut down and others are already out-of-service.
The shakeout is going to affect families dependent on mom-and-pop stations that face closing down, gas station owners say, but it will also create investment opportunities for fuel suppliers looking to grow and other retailers in expansion mode.
But with financing scarce and the economy still hurting, it’s going to take a while for an already depressed commercial market to absorb the almost 800 gas stations at risk of shutting down in Miami-Dade, a commercial investments analyst says.
Gas station owners in Florida have until Dec. 31 to meet new rules that require them to install double-walled storage tanks to prevent fuel leaks.
The Florida Department of Environmental Protection says it’s not planning to extend deadlines and enforcement is to begin immediately. Out-of-compliance stations that aren’t shut down by Jan. 1 are to face $10,000 daily fines.
Owners with underground storage tanks, making up the majority of stations in South Florida, have until Dec. 31 to comply. The deadline to upgrade aboveground tanks is Jan. 1.
“…Gas station owners in Florida have until Dec. 31 to meet new rules that require them to install double-walled storage tanks to prevent fuel leaks.”
Can’t they get “New Equipment” financing from ExxonMobilShellTexacoChevronBP76…you know like TysonMonsanto provides their $18,000 per year contract workers with the latest $500,000 chicken cave production sheds?
Leaking strage tanks & cigarettes…I’m feeling something of a lost nostalgia.
We’ve had double wall tanks (with monitors) mandated up here for a very long time.
Gas station owners say those unable to get financing to meet new Florida environmental rules have their hands tied, many are preparing to shut down and others are already out-of-service.
Back in the late ’80’s, early ’90’s the Fed mandated the use of newer gasoline storage tanks and lots of mom-n-pop places lost their pumps.
Did Florida somehow avoid it back then?
But with financing scarce and the economy still hurting, it’s going to take a while for an already depressed commercial market to absorb the almost 800 gas stations at risk of shutting down in Miami-Dade, a commercial investments analyst says.
Eight hundred out of how many total in that county? Still, even for a county with a lot of population and cars, 800 seems like a lot.
California mandated out town take out our one gas station about ten years ago because the nozzles were non-compliant and gas fumes might leak into the air while a vehicle was refueling–or while the underground storage tank was being refilled. The retrofit would have cost a couple hundred thousand dollars, and our little station probably only sold a couple hundred gallons of fuel a month–if that. So the long-time owners just said the hey with the whole thing and shut it down. Now, the closest gas station is forty miles into town.
The result of that “clean air” regulation was that now that we don’t have a gas station for our area, everyone just went out and bought 4 or 5 five-gallon gas cans, and stores them on their property or in the back of their truck for emergency fill-ups between day trips to town.
Now we have to drive 80 miles round trip just to get gasoline. The cheap plastic and rusting steel cans quintuple the leakage, the spillage, and the fumes escaping into the atmosphere. They create fire hazards. And pollute the ground water—ostensibly the very problem the regs were supposed to address.
But by cracky, the State got its clean air regulations enforced.
Honolulu lost 10% of its construction jobs.
Pacific Business News (Honolulu)
Honolulu’s construction sector saw a 10 percent loss of jobs from October 2008 to October 2009, according to an analysis of U.S. Bureau of Labor Statistics data by the Associated General Contractors of America.
Honolulu’s construction sector lost 2,600 jobs during the period and now employs 23,100.
Nationwide, the tally fell by 1.1 million jobs during the 12-month period. Only five cities posted gains in construction employment, adding a total of 1,900 jobs: Columbus, Ind.; Anderson, Ind.; Harrisburg-Carlisle, Pa.; Tulsa, Okla.; and Davenport, Iowa.
“Getting construction workers back on the job will provide a significant economic boost to virtually every community in America,” said Stephen Sandherr, the association’s CEO. “The lesson for Washington ought to be clear: We should be building our way out of the country’s current bleak employment picture.”
Reno-Sparks, Nev., had the largest percentage decline in construction employment: 32 percent.
Statewide, Hawaii lost 13 percent of its job base, or 5,000 construction, mining and logging jobs, in the October-to-October measure.
The lesson for Washington ought to be clear: We should be building our way out of the country’s current bleak employment picture.
Well, endless pork-barrel construction projects have done wonders for Japan’s economy, right? So what are we waiting for?
“So what are we waiting for?”
War…a.k.a. “Stimulating Anesthesia” ;-(
Our good friend Mr Law Of Unintended Consequences shows up yet again. Shocking that banks will raise interest rates in order to make up for lost revenue due to the law. Nobody, and I mean nobody could have foreseen this. So at the end of the day cardholders will still pay the same amount in interest/fees, except now there is another 200 page law that banks have to deal with, causing more processing costs, which will in the future cause even higher fees paid by consumers.
Thank you Nancy, Harry and Barry. I feel so much more protected from the evil banks now.
WASHINGTON (CNNMoney.com) — For millions of credit card customers, here’s the good news: As of Feb. 22, a new law will bar banks from a host of practices that consumer advocates have long blasted as unfair.
But here’s what the new law won’t do: It won’t prevent interest rates from going up for the vast majority of customers.
Even after Feb. 22, holders of so-called variable-rate cards can expect to see increases. Variable rates are based on the prime rate and meant to follow the rise and fall of that index. The problem for consumers is that the prime rate is at 3.25%, an historic low. It will almost certainly go up, experts say. And so will credit card rates, which currently average 14.9%, according to the Federal Reserve.
The law’s provisions tying variable-rate cards to the prime rate has prompted banks, including the two largest U.S. credit card issuers - Bank of America (BAC, Fortune 500) and JPMorgan Chase (JPM, Fortune 500) - to make sure most of their customers have credit cards with variable rates.
Industrywide, variable-credit cards accounted for 94% of all new credit cards offered between July and September, up from 67% of the same period in 2007, according to Mintel, a market research firm.
Yea, but they promised hope & change. So much for the hope now we get the change.
“…except now there is another 200 page law that banks have to deal with, causing more processing costs, which will in the future cause even higher fees paid by consumers.”
Haskel, you connecting of the dots…is keen. Your typing sounds like it came straight out of both sides of a bankers lips.
Peterbilt plant closes doors for good.
NASHVILLE, Tenn. – The Peterbilt plant in Madison is shutting down for good on Tuesday.
The truck manufacturer is consolidating production with its other plant in north Texas, leaving about 390 Tennessee workers out of a job.
The plan temporary shut down in February, when Plant manager Larry Vessels told News 2 the plant would not resume production until the economy improves.
Hourly workers at the plant had been locked out since June 2008 because of a labor dispute.
Maybe that will teach those PUNKS they should learn to read a newspaper, get computer literate and join blogs like this so they will never make that mistake again………Pfft!
———————————————
Hourly workers at the plant had been locked out since June 2008 because of a labor dispute
USDA Classifies PETA as a Terrorist Threat.
by Brian Merchant, Brooklyn, New York on 12. 2.09
Business & Politics
PETA is one of the most controversial activist groups operating today. The group’s contentious media campaigns, undercover operations, infamous advertising, and high profile demonstrations have made them perhaps the most notorious–and most polarizing–nonprofit organization there is. But are they terrorists? According to the US Department of Agriculture, they are now.
Looks like one of PETA’s nude ’stop the seal slaughter’ protests might have been a little too realistic. The USDA has just released a new security profile form (pdf), which it distributes to animal experimentation facilities. The form reveals that PETA has been classified as a terrorist threat by the US government–potentially opening up its members to prosecution as terrorists.
Neon sign @ Gitmo: Vacancy!
(Hwy notes: American’s should never see video of cows being pickup for slaughter processing with a Toyota forklift. It could potentially have makers of bar-b-q sauce like Kraft lose sales and that is bad for “bidness” and what is bad for “bidness” is un-American)
People for the Eating of Tasty Animals
When they went after the fishmongers in Pike Place Market, it was the last straw. Said throwing the fish was not showing the dead fish proper respect.
They ARE terrorists. And morons as well.
High-frequency trading surges across the globe.
NEW YORK/TORONTO, Dec 2 (Reuters) - High-frequency stock trading is spreading around the world into more and more asset classes, but progress is being slowed by poor infrastructure, heavy regulation and opposition from entrenched interests.
In some major markets in Asia, it can take seconds to execute an equities order. That’s a lifetime for a trader who uses sophisticated algorithms to trade thousands of shares in a millisecond with the aim of earning a profit from market making and price imbalances.
Turf battles between exchanges also sometimes prevent the kind of interconnected market approach that provides fertile ground for high-frequency trading. Traditional brokers and institutions, whose positions are threatened by upstart trading houses, also help to erect barriers.
But the high-frequency wave, estimated to be responsible for about 60 percent of U.S. stock trading, has already washed over much of Europe and is being felt in some emerging markets, particularly in Latin America.
It is also making inroads in futures, options and foreign exchange.
In Brazilian stocks, there are signs that high-frequency trading is starting to get a grip, and some relatively small markets like Mexico and Colombia are encouraging major U.S. trading firms to bring in their latest rapid-fire trading techniques.
Smaller markets are attracted by the promise of more liquidity, which can make investing and trading cheaper and easier for everyone and help those who want to raise capital.
Concerns about algos gone wild setting off a market panic are secondary.
Haste makes waste. And as we’ve just recently learned, to much interconnectness means no safety margins.
Space alien search costs AZ school worker his job.
(AP)
MESA, Ariz. – A former Arizona school district employee is accused of using school computers in an experiment to find space aliens, costing the worker his job and the district more than $1 million.
Schools officials say Brad Niesluchowski, who was Higley Unified School District’s information technology director, downloaded free software on district computers in 2000.
The program, known as SETI(at)home, uses Internet-connected computers worldwide to analyze radio telescope data in an experiment to find extraterrestrial intelligence.
But Superintendent Denise Birdwell told the East Valley Tribune that the program also bogged down the district’s system and interfered with technology use in classrooms.
Birdwell said it will take more than $1 million to fix the problem, including removal of the SETI software. She says police are conducting a broader investigation.
Niesluchowski resigned from the district Oct. 22.
His lawyer did not return calls for comment.
“…She says police are conducting a broader investigation.”
“…to find extraterrestrial intelligence?” Why not, might happen…it’s just dollars & donuts anyways.
What? 1 million to run installshield a whole bunch of times? Its not a virus.
“Schools officials say Brad Niesluchowski, who was Higley Unified School District’s information technology director”
Higley School District is just southeast of Mesa’s, about 10 miles from where I am now.
A bunch of hicks.
I should apply for Information Technology Director, and install Joshua Tree Extensions systemwide, first day on the job.
Day 2, re-install SETI(at)home, just to show them it was a good idea in the first place.
Do I hear a “BWAA HAHAHA HAHAHAHA!!!”???
How hard is it to run the uninstall program on the computers?
I’d be more than happy to help uninstall for the cool million dollars.
Any aliens listening?
1 Million?! BULLcrap! (unless of course it’s your BIL’s company)
Jesus Christ dumped from jury pool for disruption.
(AP) BIRMINGHAM, Ala. – Court officials say a Birmingham woman who changed her name to Jesus Christ didn’t live up to it when she reported for jury duty this week. The woman, previously named Dorothy Lola Killingworth, was sent to Judge Clyde Jones’s courtroom for a criminal case Monday.
Court officials told The Birmingham News Tuesday that the 59-year-old was excused because she was disruptive and kept asking questions instead of answering them.
Efforts to reach Christ for comment were unsuccessful.
Court administrator Sandra Turner said people there were shocked when the woman insisted her name was Jesus Christ and some potential jurors laughed out loud when her name was called.
But Turner said unlike some Jefferson County residents, Christ didn’t try to get out of jury duty and was “perfectly happy to serve.”
Court officials say a Birmingham woman who changed her name to Jesus Christ didn’t live up to it when she reported for jury duty this week.
sHe always gets antsy around his birthday.
“…Efforts to reach Christ for comment were unsuccessful.”
Lola could have been reached, but it is rather difficult to hear the phone ringing when listening to Faux News with the volume set a 86% and her “lap dog” continually yapping at the cockroaches in the kitchen.
Guess it beats that poor kid, Adolph Hitler Campbell….
Moody’s: US banks likely to lose money in 2010.
Moody’s says US banks face deluge of loan losses that will keep them unprofitable in 2010 ~ December 2, 2009
The credit ratings agency said U.S. banks have so far only recognized 40 percent of the loan losses they will take between 2008 and 2010.
A surge in bad loans during the third quarter and rising delinquencies point toward defaults again increasing, after showing signs of modest improvements during the first half of the year, Moody’s said.
Moody’s senior credit officer Craig Emrick said in a statement that banks started to prematurely slow down provisions for loan losses in the third quarter even as evidence pointed toward losses ticking higher again in future quarters.
Mounting losses from all types of loans, ranging from mortgages to credit cards, have significantly eaten into profits at banks for the past two years. Loan losses are likely to remain elevated as high unemployment makes it difficult for borrowers to repay debt.
And yet, somehow, the stock maket will probably continue to rally, including the bank stocks*
*Unless, of course, I jump into stocks. Then the SWHTF.
U.S. housing market meltdown not over yet: Zandi
NEW YORK (Reuters) - The meltdown of the U.S. housing market is not over yet, and home prices will soon start trekking downward again as a flood of foreclosures looms, a well-known economist said on Wednesday.
Mark Zandi, chief economist at Moody’s Economy.com in West Chester, Pennsylvania, said in an interview with Reuters home prices will resume their decline by early next year as foreclosure sales pick up again.
“The housing crash is not over,” he said.
The U.S. housing market has suffered the worst downturn since the Great Depression, and its impact has rippled through the recession-hit economy as well as the rest of the world.
A setback for the hard-hit housing market could portend problems for the U.S. economy.
Home prices, as measured by the Standard & Poor’s/Case-Shiller U.S. National Home Price Index, will trough in the third quarter of 2010 after declining 38 percent, Zandi said.
The index peaked in the second quarter of 2006 and hit a trough in the first quarter of 2009, a drop of about 32 percent.
Nice post…..
Thanks wmbz, I needed that.
Home prices going down, gold going up, good for me.
Beachfront Property Rights May Be Backed by U.S. Supreme Court.
Dec. 2 (Bloomberg) — The U.S. Supreme Court considered bolstering the rights of oceanfront property owners, as justices questioned a Florida program that protects against erosion by adding sand and creating new strips of public beach.
A group of landowners in the Florida panhandle contend that the program, at least as interpreted by the state’s highest court, violates the U.S. Constitution by converting their oceanfront homes into ocean-view property.
Hearing arguments today in Washington, several justices said they worried that landowners might find their once-private beaches filled with food vendors, amusement parks, portable toilets and raucous college students.
“You could have televised spring-break beach parties in front of somebody’s house,” Justice Samuel Alito said.
Other justices pointed to protections in Florida law that give landowners a right of access to the water and bar permanent structures on the new strips. The law also guarantees that affected property won’t be reduced in size by erosion.
“I’m not sure it’s a bad deal” for the landowners, Justice Antonin Scalia said. “And they’re guaranteed against further loss of property.”
At another point, Scalia said that “people pay a lot more money for beachfront property” to avoid having to share the beach with others.
Under Florida law, oceanfront property owners traditionally own the beach up to the mean high-water mark, while the submerged land beyond that is state property.
Hot Dogs in the Water
Those rules mean that property owners in some senses already have to share the coastline, Justice Sonia Sotomayor said. “If a hot dog vendor wanted to sit in a foot of water, it could have,” she said.
We don’t worry about this kind of crap, we make our own. Love to watch the moon-shine.
Raising Md. alcohol taxes would be beneficial ~ Washington Business Journal
Increasing alcohol taxes in Maryland would raise substantial new revenue for the state, according to a report released Tuesday by the Johns Hopkins University Bloomberg School of Public Health.
The report, funded by the Abell Foundation, says if there was a dime a drink increase in Maryland’s alcohol excise taxes, alcohol consumption would be cut by 4.8 percent and $214.4 million in new revenues would be generated for the state.
More than two billion drinks were consumed in the state last year, according to the report, and the state got $26.9 million in tax revenue from that drinking.
The report cites a recent review of 110 studies that shows alcohol sales increase when prices fall, and drop when prices, or taxes, go up.
A dime a drink increase would save an additional $249 million in costs incurred in the state because of drinking, as the tax increase could prevent alcohol dependence, deaths and acts of violence. The additional revenues created could help create and preserve the state’s jobs and services, points out the report.
A bill introduced this year by Del. James Hubbard, D-Prince George’s County, would boost the tax on all alcoholic beverages by 10 cents per drink, or 11 cents for beer and 12 cents for wine and spirits.
China, India, Brazil Reject Copenhagen Draft
NEW DELHI/LONDON (Reuters) - China and other big developing nations rejected core targets for a climate deal such as halving world greenhouse gas emissions by 2050 just five days before talks start in Copenhagen, diplomats said on Wednesday.
China, the world’s top emitter, together with India, Brazil and South Africa demand that richer nations do more and have drawn “red lines” limiting what they themselves would accept, the diplomats told Reuters.
The four rejected key targets proposed by the Danish climate talks hosts in a draft text — halving global greenhouse gases by 2050, setting a 2020 deadline for a peak in world emissions, and limiting global warming to a maximum 2 degrees Celsius above pre-industrial times, European diplomats said.
Developing nations want richer countries to do much more to cut their emissions now before they agree to global emissions targets which they fear may shift the burden of action to them, and crimp their economic growth.
“We cannot agree to the 50/50 (halving emissions by 2050) because it implies that … the remaining (cuts) must be done by developing countries,” South Africa’s chief climate negotiator Alf Wills said, partly confirming the EU diplomats’ comments.
Rich nations’ carbon offers so far were far below those recommended by a U.N. panel of scientists, Wills told Reuters, making clear that developing nations could change their stance if industrialized states tightened their carbon targets.
The dispute underscored a rich-poor rift which has haunted the two-year talks to agree a new global climate deal to succeed the Kyoto Protocol in 2013 and dampens hopes of rescuing the December 7-18 Copenhagen summit.
A legally binding deal is already out of reach for the U.N. talks, with only a political deal possible.
“China, India, Brazil Reject Copenhagen Draft”
Good for them, and they should. More than a few countries are beyond tired of being told what they should ‘do’ by some “elitist” groups of “smarter” than everybody else types. The U.N. is a complete joke that wastes billions.
Wonder how these world managers will get to this meeting? I’m sure it will be by some mode of low carbon emitting vehicle,right? Riiight!
Good for them, and they should.
I don’t know that they should in the long-view, but I understand the sentiment.
The “do as we say, not as we do” rhetoric from the US and Western Europe is — from China, Brazil, or India’s perspective — both hypocritical and tiresome.
I agree with China, India, and Brazil. Ignore the elitists who want to control every human.
Perhaps these “developing” guys can read our news?
How do you say “Fool me once….” in mandirin?
Of course they would like us to strangle our own economies while they watch and laugh.
I miss the days when Human Rights was of some importance to the liberal minded.
Tired feet? Try Botox in your soles. (UK)
The latest fashion tip to survive the party season is Botox – in your feet.
Female City executives are turning to Botox injections in the soles of their feet to help them cope with the exhausting drinks party season over the next few weeks.
According to the Harley Medical Group, one of Britain’s largest cosmetic surgery chains, women in London are injecting Botox into their feet to alleviate the pain associated with wearing high heels.
Instead of buying a gel-filled pad to put inside their shoes, they are preferring to use collagen to plump out the balls of their feet. The Harley Medical Group calls the new technique “foot fillers”.
The company said that it was common in the run up to Christmas to see a rush of bookings for Botox. However, facial injections used to be the only area clients requested, until last year when one or two asked to have their painful feet sorted out.
Foot Botox is so last year, today’s savvy cosmetic surgery consumer is all about cooch augmentation
coochie coochie coo
Roidy
Wait a minute. I thought Botox not only blocked pain and sensation, but also paralyzed the muscles into which it’s injected. I believe it’s the paralytic effect that causes people like Nancy Pelosi not to have any wrinkles.
How do you walk or maintain your balance if you can’t feel your feet?
Botulinum toxin acts at the junction between the nerve and the muscle it innervates, blocking transmission. So you are right - it paralyzes muscles and has no effect on sensation. If you inject botox superficially into the surface of the soles of the feet you will only affect sweat glands. Great for stinky feet!
Damn but people are stupid.
People are lemmings.
Those NAR lobbyists better get busy…
Fed’s Lacker sees asset sales as key part of exit
Wed Dec 2, 2009 2:44pm EST
CHARLOTTE, North Carolina (Reuters) - A top Federal Reserve policymaker said on Wednesday he favors selling mortgage-backed securities as a “natural” first step in the central bank’s exit strategy.
Some market analysts fear the housing market is still far too fragile to withstand the impact of the higher interest rates that would likely accompany such a move. But Jeffrey Lacker, president of the Federal Reserve Bank of Richmond, said he was not concerned.
“To my mind, a natural place to start is asset sales,” he told reporters after a speech in Charlotte, North Carolina, playing down fears of market disruptions. “We have to move over time to channeling resources away from the housing market. It doesn’t seem advisable to me to build a recovery based on housing.”
…
More News
BofA Lewis does not see renewed housing slump
2:08pm EST
BofA’s Lewis hints may stay past year-end
1:48pm EST
Fed must not dither on timing exit, Lacker says
1:42pm EST
RPT-Fed’s Lacker sees risk in waiting too long to exit
1:11pm EST
In nod to critics, Fed restricts stock ownership
No more free internet surfing. From now on, ya gotta pay, to stay, say Google and friends:
Google to limit free access to online news.
Publishers will be able to set a limit on the number of articles people can read for free through Google using the First Click Free initiative.
By Claudine Beaumont, Technology Editor
Published: 4:25PM GMT 02 Dec 2009
The First Click Free initiative will ensure content remains discoverable but allows companies to implement paywalls, says Google. It means that content providers, such as newspaper publishers, will be able to restrict how many stories people are able to read online for free.
The move comes just weeks after Rupert Murdoch, chairman and chief executive of News Corporation, which owns newspapers such as the Sun and the Wall Street Journal, announced plans to start charging readers for accessing online content. Another newspaper publisher, Johnston Press, has also said it would start charging for some of its online content, including local newspapers such as the Yorkshire Post and The Scotsman. Publishers can join a special program, known as First Click Free, which allows Google to index content on the publisher’s website but prevents users from reading other articles on that site without first registering or signing up to a subscription package.
Josh Cohen, a senior business manager at Google, said it meant that publishers could ensure their content was “discoverable” while still being able to maintain their own paywalls.
“The user’s first click to the content is free, but when a user clicks on additional links on the site, the publisher can show a payment or registration request,” wrote Mr Cohen on a blog post. “First Click Free is a great way for publishers to promote their content and for users to check out a news source before deciding whether to pay.
All I can say is good luck with that. I believe the NY Times tried the pay per view and didn’t work out to well for them.
Supply will meet demand. Another free site will spring up and take market share (and advertising revenues) if the current heavy hitters decide to gouge their readers.
By the way, $1224 per ounce is one of those gnomes-of-Zurich type numbers for gold that some say portends much.
Who knows. I’m seeing spot at $1223 right now, and there is a full moon, and Pelosi is still in office, and the Yankees won the series; anything is possible in this fine time/space continuum we inhabit as our little blue marble goes whizzing along…
Just hit 1224.
For the tad insane who may lurk among us, a glimpse of the golden ladder:
http://tinyurl.com/ycpp6nw
So let me guess. You did not buy any at $270 spot and you are p.o.’d. Right?
Peter Schiff on CNBC today selling gold sounded like Leslie Appleton Young talking about houses in 2006. He actually said that they’re not making anymore gold. I guess his greed is overwhelming his desire for public office.
http://www.cnbc.com/id/15840232?video=1348309909&play=1
So we should regard gold like real estate.
Okay I will apply for an FHA loan for gold. I will put zero down and pay it off in 30 years.
I will look for the $8,000 tax credit for first time buyers for gold.
I will look for the zero capital gains break of owning gold for at least two years.
I will be look for the ability to deduct the interest from taxes on money I borrow to buy gold with.
I will look for the authorities to push gold for the ownership society. China is doing that at least. I will expect Bernanke, Obama, and Timothy to cheerlead for owning gold.
Note I stopped buying gold several months ago at $900 per ounce. My basis is somewhere below $900. I don’t know the exact number because I don’t remember what prices I bought my gold at. Somewhere below $970 spot
I would be happy to see gold go down to $600 spot, and I’d buy much more. But I think it will go no lower than $1,000 before going up to $2,000.
Wednesday, December 02, 2009 12:02 PM
Downsizing Banks Deemed Too Big to Fail
Newsweek
By William Underhill and Matthew Philips
…while the U.K.’s biggest banks are slimming down, their American counterparts remain behemoths. Four U.S. banks–JPMorgan Chase, Citigroup, Wells Fargo, and Bank of America–control nearly 40 percent of the country’s deposits, according to financial Web site the Motley Fool. But there’s an effort in Congress to give U.S. regulators the same kind of chopping powers being wielded in Europe. An amendment added to the House financial-reform bill on Nov. 18 would empower federal regulators to dismantle financial firms deemed too big to fail, before they actually do. The amendment’s sponsor, Rep. Paul Kanjorski, met with EU regulators this summer and modeled the bill on their efforts. In an interview with newsweek, Kanjorski says, “It essentially gives us the power to amputate the leg before the infection kills the entire body.”
Senator Sanders puts a hold on Bernanke’s nomination.
http://tinyurl.com/ylxs66u
Can one senator stand in the way of Bernanke’s reappointment?
Perhaps the reappointment could be made conditional on busting up the too-big-to-fail Megabank trusts on Wall Street, whose systemic risk hangs like the sword of Damocles over the global economy’s head. Or would that constitute an infringement on the independence of the Fed’s monetary policy?