The Housing Bubble

Fed May Take Chance End to Debt Purchases Won’t Hurt Housing.

Jan. 27 (Bloomberg) — The Federal Reserve may take a chance the housing market can stage a comeback without its support by announcing today it will stick to the plan to end a $1.25 trillion program of mortgage-debt purchases in March.

Fed Chairman Ben S. Bernanke and other policy makers meet after the sixth straight monthly gain in home prices in November added to signs housing is stabilizing. With financial markets rebounding, the central bank has said it plans to end emergency aid to bond dealers and money markets by Feb. 1.

Swaps Trading Surges as National Deficits Rise: Credit Markets

Jan. 27 (Bloomberg) — Traders are buying protection against defaults on sovereign debt at more than five times the rate of company bonds as governments fund ballooning deficits.

The net amount of credit-default swaps outstanding on 54 governments from Japan to Italy jumped 14.2 percent since Oct. 9, compared with 2.6 percent for all other contracts, according to Depository Trust & Clearing Corp. data. European countries led the jump, with the amount of protection on Portugal climbing 23 percent, Spain 16 percent and Greece 5 percent.

Rising use of derivatives to insure against defaults or speculate on government bond prices is spilling over into the corporate debt market, stemming a rally that drove yields to the lowest relative to sovereign benchmarks since December 2007, according to BNP Paribas SA. The global financial system remains “fragile,” with sovereign debt posing a risk to markets, the Washington-based International Monetary Fund said yesterday in its Global Financial Stability Report.

An acquaintance mentioned the owner of a certain house was going to put it up for sale last year. The listing never materialized and the acquaintance then told me the owner was waiting until the market rebounded.

The house just listed…..for $110k more than the last sale on the street, $110k more than what I think is a relatively comparable house. This house may be a bit more “perfect” in its turn key prep but that’s a steep premium over the most recent comp for a home just a few lots down. Obviously we’ve got sellers thinking the “downturn” (ha! for this market it was a matter of a few months) is just a memory in the rearview mirror.

Third times the charm?
U.S. May Retool Mortgage Program to Help Underwater Homeowners.

Jan. 27 (Bloomberg) — The Obama administration’s $300 billion Hope for Homeowners program may be retooled to help the growing number of Americans who owe more than their properties are worth as current anti-foreclosure efforts fail to account for these “underwater” borrowers.

The changes would be at least the third lease on life for the program, which began in October 2008 during the Bush administration and has so far helped just 96 of the 400,000 homeowners originally targeted.

The U.S. Federal Housing Administration is considering ways to make the program more effective, Commissioner David Stevens said in an interview. While he wasn’t specific about any changes, he said Hope for Homeowners could be expanded to more directly help borrowers with negative equity.

New home sales forecast to show 4.2 percent increase in Dec.

WASHINGTON (AP) — December’s sales of new homes are expected to have increased after plunging unexpectedly a month earlier in a sign that the ailing market is finally climbing back from the worst bust in decades.

The Commerce Department’s report on new home sales Wednesday is forecast to show a 4.2 percent increase to a seasonally adjusted annual rate of 370,000, from 355,000 in November, according to economists polled by Thomson Reuters.

It counts signed contracts to buy homes, rather than completed sales, so it will capture consumers’ early reaction to an extended and expanded homebuyer tax credit.

“Hows about we just agree that you stay an idealistic curmudgeon, and I remain a curmudgeonly idealist?”

I just lifted this from yesterday’s thread. That is a great way to start the day. A good laugh is always good for a new day.

Obama is set to press for a high-speed rail line Thursday. I hope this actually has some substance. Can you imagine how nice it would be that Boston, New York, Baltimore, Philadelphia and Washington D.C. were all linked by high-speed rail? I have taken the train to Boston. It is a beautiful ride but it is 5 hours. If you cut that down to 2 hours it would be amazing.

The airlines will lose out. They will probably scream. Too bad. Kunstler will be very happy if “happy motoring” is impacted. The “Amtrak has never made money” crowd will be shouting. Show me one form of mass transportation that has ever really made money. We dumped how many billions into the silly airlines after 9-1-1? What did that get us?

Oh, Bama, do this one thing right. Don’t view this as a gift to your union buddies. Don’t let them eat through another system.

Housing recovery could take a decade, economists warn.
Washington Post~January 27, 2010

Even as the housing market shows signs of improvement, including in new data released Tuesday, economists warn that it could take up to a decade for many homeowners to regain equity in their homes, while some people in the hardest-hit regions of the country may not see a recovery during their lifetime.

Home prices have fallen 30 percent since reaching their peak in 2006, and many economists think they will take another tumble this year as more foreclosures pile on the market. The pace of recovery will vary throughout the country, with homes in the most battered markets taking the longest to regain value. Meanwhile, millions of homeowners who are “underwater” — owing more on their mortgages than their homes are worth — face years of negative equity that puts them at a higher risk of foreclosure.

“What are we going to do down the road when people who should have been saving for retirement, or college funds, are spending that money instead staying current on their underwater home?” said Brent T. White, a University of Arizona law school professor who has studied underwater borrowers.

Obama to focus on jobs, deficit in State of the Union

WASHINGTON (Reuters) - After his worst political setback since he took office a year ago, President Barack Obama will vow to revive job growth and tame skyrocketing budget deficits in a crucial State of the Union speech on Wednesday.

TOKYO/DETROIT, Jan 27 (Reuters) - Toyota Motor Corp will suspend U.S. sales of eight models subject to a massive safety recall, an unprecendented move that sent its shares tumbling and raised questions about the timing of its earnings recovery.

Toyota said it would also halt production of the models, including the best-selling Camry, at plants in the United States and Canada in the first week of February.

Shares in the world’s biggest automaker suffered their biggest slide in eight months, falling 4.3 percent in a Toyko market .N225 down 0.7 percent on Wednesday.

Last week, Toyota announced it would recall 2.3 million vehicles in the United States to fix potentially faulty accelerator pedals, its second large recall in four months in the United States, its biggest market.

The series of recalls threaten to damage Toyota’s reputation for safety and quality that helped it ascend to the top of the global auto industry.
“This unprecedented automotive decision indicates how serious a safety problem this is,” said Michelle Krebs, senior analyst at Edmunds.com. “We’ve gone from floormats to recalls for wear items to a full shutdown, and I can’t help but think that the company’s credibility is being called into question.”

NASA’s plans to return astronauts to the moon are dead. So are the rockets being designed to take them there — that is, if President Barack Obama gets his way.

When the White House releases his budget proposal Monday, there will be no money for the Constellation program that was supposed to return humans to the moon by 2020. The troubled and expensive Ares I rocket that was to replace the space shuttle to ferry humans to space will be gone, along with money for its bigger brother, the Ares V cargo rocket that was to launch the fuel and supplies needed to take humans back to the moon.

There will be no lunar landers, no moon bases, no Constellation program at all.

In their place, according to White House insiders, agency officials, industry executives and congressional sources familiar with Obama’s long-awaited plans for the space agency, NASA will look at developing a new “heavy-lift” rocket that one day will take humans and robots to explore beyond low Earth orbit. But that day will be years — possibly even a decade or more — away.

Who needs rockets when there is money to be made by screwing the taxpayers?

Good thing the U.S. economy doesn’t have any of the problems the U.K. does.

UK economy lies ‘on bed of nitroglycerine’ – top financier ~ Daily Mail

Bill Gross deals blow to government with warning to his investors that Britain’s debt makes it a ‘must to avoid’

The government’s hopes of claiming credit for reviving the British economy suffered a severe blow today when the world’s biggest buyers of bonds warned that the UK was a “must to avoid” for his investors as its debt was “resting on a bed of nitroglycerine”.

The intervention by Bill Gross, co-founder of California-based fund managers Pimco, came on the day official figures confirmed that Britain had emerged from the deepest recession since the 1930s – but only by the narrowest of margins.

The economy grew by 0.1% in the final three months of last year, much weaker than even the most cautious expectations in Westminster and the City. The unexpectedly sluggish performance prompted Alastair Darling to warn that Britain could yet fall back into recession, telling the Guardian “there will be hiccups along the way”.

India’s stock market SENSEX down by almost 1600 points in the last four trading sessions. Looks like Asia is headed for a drop in the coming weeks. Emerging market funds would have a bad return this quarter. I thinking these markets are now “emerged markets” with the kind of pricing these countries have for RE. A livable normal apartment costs $1 million in Shanghai, more than a million in Hong Kong, same in Beijing and Bombay and close to $600K in Delhi, India.

I share an office with 3 other people. 2 of us rent, 2 of us own… guess which two just spent the last 10 minutes talking about “strategic default?”

Interesting times…

Dumb questions of the day:

1. Have the Treasury Department and the Fed essentially merged purposes?

2. If no, please explain what central bank independence means for us Lilliputians who don’t grasp the concept.

3. If yes, why not simply turn the Fed into a subsidiary of the Treasury Department?

Which means it’s stock will go up.

Caterpillar profit down 65%
LONDON (MarketWatch) — Construction and mining equipment group Caterpillar Inc. said Wednesday that its fourth-quarter net profit fell 65% as it also forecast sales and earnings would rebound in 2010.

Hey Eddie. I just clicked over to CNN. They’re talking about a stimulus Boardwalk project in Delaware that cost $5.5 million to create 31 jobs. You really should watch it - it would give you a lot of ammo.

From Politico:

“Fox is the most trusted television news network in the country, according to a new poll out Tuesday.

A Public Policy Polling nationwide survey of 1,151 registered voters Jan. 18-19 found that 49 percent of Americans trusted Fox News, 10 percentage points more than any other network. Thirty-seven percent said they didn’t trust Fox, also the lowest level of distrust that any of the networks recorded.

CNN was the second-most-trusted network, getting the trust of 39 percent of those polled. Forty-one percent said they didn’t trust CNN.”

MSNBC viewers were too small a sample to survey.

What does housing have to do with Wall Street share prices any more? Here I was thinking that Wall Street and the housing market had decoupled, once the TARP got rid of all those nasty toxic MBS.

Market Snapshot

Jan. 27, 2010, 10:21 a.m. EST
U.S. stocks weaken after housing data

‹ Previous Column

U.S. stocks end down after late-day swoon

By Peter McKay, MarketWatch

NEW YORK (MarketWatch) — Stocks weakened Wednesday following the release of data showing an unexpected drop in sales of new homes.
…

AFSCME agrees to 200 layoffs ~ January 27, 2010

A months-long legal dispute between Gov. Quinn and state government’s largest employee union ended Tuesday with the union agreeing to lay off roughly 200 state workers.

The number could increase if the state proceeds with closures of state facilities that already have been announced, such as the Thomson Correctional Center.

The lawsuit stems from an effort by Gov. Quinn last summer to cut $1 billion from the budget by laying off 2,600 state workers. AFSCME sued, arguing the layoffs violated the union’s contract and put public safety at risk because 1,000 would come from the Corrections Department.

PurinaCare offers pet insurance as group benefit to employers.
San Antonio Business Journal

PurinaCare Pet Health Insurance is expanding into the employee group benefits business.

PurinaCare created a Group Benefits Department that will offer employers and associations group discounts for providing their employees and members with pet health insurance.

Pet insurance is a coverage program designed to pick up the tab on the high cost of vet bills. A report by the American Pet Products Manufacturers Association showed that last year dog owners spent $785 on average on vet bills while cat owners spent $516. Another survey by the same association showed that despite the recession, 80 percent of pet owners continued to spend the same level of money on their furry friends.

Through PurinaCare’s new program, the company is hoping employers will offer pet health insurance — in addition to the health insurance provided for humans — as an added benefit to attract and retain employees.

Pretty much guarantees that vet visits will increase in cost, along with more and more BS tests for various ailments. Along with they will let the pet med business advertise their wares to pets now. Great move!!

Andrea, always has her finger on the pulse of the common man!

“There’s an anger out there, and I have not seen it since my very first campaign which was George Wallace. There is an angry subtext because of economic dislocation.”

~Andrea Mitchell

WTH? “Unexpected” again!

Sales of new homes sink 7.6 percent in December as industry wraps up weakest year on record.

WASHINGTON (AP) — New home sales unexpectedly fell 7.6 percent last month, capping the industry’s weakest year on record.

December’s sales fell to a seasonally adjusted annual rate of 342,000 from an upwardly revised November pace of 370,000, the Commerce Department said Wednesday. Economists surveyed by Thomson Reuters had forecast a pace of 370,000 for December.

The results were the weakest since March and indicated demand remains sluggish despite newly expanded tax incentives to spur sales. The report is likely to fuel concern that the housing market turnaround will falter when government support ends this spring.

Tom Brown, co-owner of Summerville, S.C.-based Crown Home Builders, was not surprised that last month was so poor for the industry as a whole. Buyers are having trouble meeting tough criteria for mortgage loans, he said. And though builders are cutting prices, the shaky economy and weak job market are keeping home shoppers away.

“People are holding on to what they have,” he said.

Nokia to close Boca Raton facility ~ South Florida Business Journal

Nokia Siemens Networks has notified the state that it plans to lay off 86 employees at its Boca Raton location.

The world’s biggest cell phone maker said the layoffs are effective March 13. It expects layoffs will continue throughout the year.

The facility, at 900 Broken Sound Parkway, will be permanently closed by the end of 2010, the company noted.

It was not immediately clear how many employees work at the facility. Calls to the Boca Raton office were not immediately returned.

Those of us who play by the rules, are getting punished (over & over): http://blogs.wsj.com/developments/2010/01/26/bank-of-america-agrees-to-modify-second-mortgages/

Airlines suffered record drop in traffic in 2009: IATA Jan 27,10

International airlines suffered their biggest decline in traffic since 1945 last year as passenger demand fell 3.5 percent, the International Air Transport Association said Wednesday.

Freight also fell, by 10.1 percent, as “full-year 2009 demand statistics for international scheduled air traffic that showed the industry ending 2009 with the largest ever post-war decline,” IATA said in a statement.

“In terms of demand, 2009 goes into the history books as the worst year the industry has ever seen,” said Giovanni Bisignani, director general of the world’s biggest airlines’ association.

“We have permanently lost 2.5 years of growth in passenger markets and 3.5 years of growth in the freight business,” he added.

Stimulus but no jobs. January 27, 2010

NEW YORK (CNNMoney.com) — The $787 American Recovery and Reinvestment Act is supposed to help jump-start the economy and especially put Americans back to work. But the truth is, relatively little of the stimulus spending has directly led to new hiring.

“Most of the thrust has been in trying to prevent jobs from being lost,” said Nigel Gault, Chief U.S. economist for Global Insight. “It probably hasn’t created a lot of new jobs given where the money has gone.”

The money so far has gone mainly for tax breaks and social service programs. Of the $265-billion cost to taxpayers during the Recovery Act’s first 11-months, $100.6-billion (38%) has been injected into entitlement programs, mainly Medicaid, $92.8-billion (35%) for tax benefits, and just $71.5-billion (27%) for contracts, grants and loans.

Jan. 27 (Bloomberg) — Treasury one-month bill rates turned negative for the first time in 10 months, as issuance declines while investors seek the most easily-traded securities amid a renewal of risk aversion.

The rate on the four-week security dropped to negative 0.0101 percent, the lowest since it reached negative 0.015 percent on March 26. The Treasury sold $10 billion of four-week bills on Jan. 26 at a rate of zero percent, the second auction of the securities in three weeks at zero percent. Winning bidders will receive no interest on their investment.

“There’s some flight to quality with concern around sovereign risk around the globe, like Greece,” said Anshul Pradhan, an interest-rate strategist in New York at Barclays Plc, one of the 18 primary dealers that are required to bid at Treasury auctions. “Secondly, the bill universe is likely to shrink as the Treasury continues to term out debt, tilting the balance further toward demand.”

Greece’s 10-year bonds fell, pushing the premium investors demand to hold the securities instead of benchmark German bunds to the most since the inception of the euro, on concern the nation’s finances will worsen.

Bill rates turned negative for the first time and note and bond yields reached record lows at the end of 2008 as investors sought refuge in government securities after the collapse of Lehman Brothers Holdings Inc. and a freeze in global credit markets. Bill yields turned negative again in March as banks and financial firms sought to bolster their balance sheets at the end of the quarter.

Treasury Secretary Timothy Geithner is seeking to lock in near record-low borrowing costs by lengthening the average due date of the Treasury’s outstanding debt. The Treasury plans to lengthen the average due date to 72 months from a 26-year low of 49 months.

Good luck Timi

Don’t Worry — Yet: “Very Big Correction” Coming Later This Year, Charles Nenner Says ~~ Jan 27, 2010 Investing, Emerging Markets.

Wall Street can quit worrying about a stock market correction…for now. Market forecaster Charles Nenner, who called the crash of 2008, says the recent pullback in U.S. stocks is not “what they call the big one.”

According to a combination of technical models and cycles he follows, Nenner concludes the S&P 500 will continue to trade in a tight range for at least the first half of the year.

“Chances are that we’ll see a very big correction” in September or October, the former Goldman Sachs market timer tells Aaron in this accompanying clip, suggesting investors will get spooked by higher interest rates, spurned by a stronger-than-expected economic recovery.

It’s a different story when it comes to emerging markets and China. Nenner thinks the recent correction in Chinese markets is for real. He predicts the U.S. will outperform emerging markets as China’s government works to cool the economy and tighten liquidity.

I watched a part of Richard E. Nixon’s first one, same for Jimma Carter. One whole one by R. Reagan, and since that time I have passed on watching the show. Barrys writers best have their act together with the right talking points,to try and(as politicians do)continue pulling the wool over the populaces eyes. If he refers to himself too much or keeps laying blame elsewhere, it will bomb. The MSM will give him an A+ no matter what though.

Obama’s State of the Union aims to get economy and presidency on surer footing ~ Wednesday January 27,

WASHINGTON (AP) — President Barack Obama will devote most of his first State of the Union address on Wednesday to fixing an economy that has sapped the nation’s spirits and eroded his standing, with calls for tax cuts for small businesses and more restraint from a government that keeps piling up debt.

Obama will start on the economy and spend about two-thirds of his prime-time speech on that topic, the one most on the minds of Americans. His goal is to show a dissatisfied nation in plainspoken and specific terms that he understands their frustration and their struggles, and that his vast agenda is in touch with what they need.

Chinese legal experts call for ban on eating cats and dogs.

Widespread and ancient practice of eating dog meat increasingly distasteful for China’s growing affluent, pet-loving middle class.

Chinese legal experts are proposing a ban on eating dogs and cats in a contentious move to end a culinary tradition dating back thousands of years.

The recommendation will be submitted to higher authorities in April as part of a draft bill to tackle animal abuse.

In ancient times, dog meat was considered a medicinal tonic. Today, it is commonly available throughout the country, but particularly in the north where dog stew is popular for its supposed warming qualities.

Found! The stunning mountain that inspired Avatar’s ‘floating peaks’
Mail Foreign Service ~ 27th January 2010

Its soaring steeple of rock topped by a small oasis of trees looks straight out of the 3D blockbuster Avatar.

But this is no special effects illusion, it’s a real-life tower of quartz-sandstone deep in the rugged mountain terrain of southern Hunan in China.

The 3,544ft Southern Sky Column is one of 3,000 in the Zhangjiajie National Forest Park and became the inspiration for the magical ‘floating peaks’ in James Cameron’s film after a Hollywood photographer spent time shooting there in 2008.

Read more: http://www.dailymail.co.uk/news/worldnews/article-1246457/China-renames-mountain-Avatar-movie-Avatar-Hallelujah-Mountain.html#ixzz0dq7orVCA

Its time to initiate the largest undertaking of infrastructure building projects ever seen.
On all four coasts and the plains of the middle west, new wind generating stations are to be built, with enough power making capacity, to power a world class light rail system from east to west, north to south.
Old rail coridors are going to be retaken and a system of light rail will be built, far exceeding any highway system we now have in the United States.
Imagine, traveling from milwaukee to Chicago in 35 minutes. From Minneapolis to Davenport Iowa, in an hour.
Sub systems will be built within the suburban 30 mile range of all cities, with non stop rail transportation to city centers. All major expressways will be torn down and in place, will be light rail.
Auto service, will only be allowed on secondary hiways and in local enviroments.
This project will accomplish all the climate goals and energy conservation for the next one hundred years.
All materials for this project will be required to made in America. From the steel, to the engines, to the technology…mandatory made in America.
The project estimates to initially employ in the range of 500,00 skilled and semi-skilled workers.
New steel rolling mills will be built. Electric engines must be built, along with bridges, overpasses and stations. All rail systems will be operated by private enterprise, with pric controls in place for 50 years.
Americans will again retake their manifest destiny. In the long run, millions will be put back to work.
The need for foreign oil will evaporate. Americans will be able to travel by land anywhere in this country and fast.
Airlines will be madatorily slimmed down, to be used only for foreign travel.
With each wind generating station built, the rail expands further on power available.
This will be a monster project, involving millions of Americans and the way they travel in the future.
Nuclear power plants and coal fired plants will be regulated to commercial and home uses only.
Las vegas, will loose 50% of its power, under the new plan. No more wasted casino billboards.
Want to go to new York, from Chicago, hop a train and youll be there faster than flying.
This is my state of the union speech. AND, were going to pay for this with a $1.00 dollar a gallon gas tax, along with closing out maintenance on all federal highways. Trucking will be mandatory on specified truck roads only.. All interstate trucking will be banned from city deliveries. Local trucking will be the mode for delivery.
Automobiles will be banned from city centers.
Suburban commuting by rail will be mandatory.

Rest stops and gas stations will be banned from federal highways.
We can, we will, and we must!

I am seeing more stories like this as Medicaid reduces reimbursements.

Local Nursing Home May Close. ABC ~ Southern Illinois

HAMILTON COUNTY- A local nursing home faces serious financial problems. Administrators say the facility may have to close.

The Hamilton Memorial Nursing Center in McLeansboro says the facility is losing $40,000 a month because of low state medicaid reimbursements.

The center employs 50 people and another 50 call it home; but administrators aren’t sure how much longer it will be able to stay open.

“We wouldn’t have this financial situation if the state would be paying the money they’re supposed to be paying,” says CEO Randy Dauby.

Dauby says three quarters of patients at Hamilton Memorial Nursing Center are on Medicaid. He says it costs more money to take care for those patients than the state provides.

In fact in a state-by-state comparison, Illinois pays so little it costs nursing homes more than $20 a day out of pocket for each medicaid patient.

Be sure and play this if you watch the show tonight.

HuffPost Comedy’s State Of The Union Drinking Game 2010.

http://www.huffingtonpost.com/2010/01/26/state-of-the-union-drinki_n_436932.html

Lynch to little TTT…

Rep. Stephen F. Lynch (D-MA): “It makes me doubt your commitment to the American people.”

SEN. SPECTER: “I Don’t Appreciate The Congressman Shouting At The Secretary”

Earth Becoming Invisible to Aliens
by Martin Evans

Chances of earth being detected by alien life forms are disappearing because of the digital revolution, a leading space scientist has claimed.

Dr Frank Drake said the phasing out of analogue transmissions from television, radio and radar was making our planet electronically invisible from outer space.

While old style signals used to spread out millions of miles into outer space, even reaching some distant stars, digital transmissions are much weaker and therefore are less easy to detect by extra-terrestrial life forms.

Scientists on earth are constantly monitoring the heavens for any sign of transmissions from other planets and it is assumed other life forms out there will be doing the same.

But Dr Drake, who founded the US based organisation Search for Extra-terrestrial Intelligence (SETI), 50-years ago, said the phasing out of analogue transmissions was making this virtually impossible.

Here’s some fiction:

The ex-head honcho of the most powerful nation on earth stands smirking before a big sign that reads “A House for Everyone” while being coerced by powerful interest groups for their further enrichment, oblivious to the very policies that accelerate the dismantling of the dispirited middle-classes into two legions divided by their petty bickering whilst the principle larcenists refine their redistribution’s of government deficit dollars into the coffers of their business concerns, and reward their best con men with outlandish bonus’s at taxpayer expense to the detriment of those same bickering masses and their offspring who’ll foot the bill of deceit until their kids follow suit. Where’s that new issue of the Robb Report Senator? I kind of see the latest McIntosh gear in my summer house on the Cape, you too my dear CEO friends?

Suspending Money Market Redemptions Is Now Legal; SEC Approves New Money Market Regulation In 4-1 Vote

http://www.zerohedge.com/print/63493

Does anyone know why palmy hasn’t been posting?

Zeledyne glass plant in Tulsa laying off 210
Tulsa World ~ 1/27/2010

Zeledyne LLC has issued layoff notices to 210 people and notified employees that it plans to close its glass-producing operation in southeast Tulsa.

United Auto Workers local union president Fred Dorrell said employees received notices Wednesday morning informing them that Zeledyne plans to shut down its second “float line,” the part of the factory that makes glass.

“All we want to do is do our job and support our families,” Dorrell said.

The layoffs will be effective March 28, according to the company notice.

The plant has about 460 hourly workers, Dorrell said. The remainder of the employees work in a glass-cutting operation and administration.

The plant was owned by Ford Motor Co. and went by the Ford Glass name until Zeledyne acquired it 20 months ago. It makes glass for Ford as well as architectural applications such as high-rise buildings.

Zeledyne shut down the other float line a year ago, citing a weak economy and declines in the construction industry.

Paulson: 25% unemployment rate without AIG bailout.

WASHINGTON (MarketWatch) - Facing criticism on Capitol Hill, former Treasury Secretary Henry Paulson on Wednesday defended his decision to complete a $182 billion bailout of American International Group Inc., arguing that the unemployment rate would have risen easily to 25% without the bailout. “If the system had collapsed millions more in savings would have been lost,” said Paulson, who was Treasury Secretary at the time of the bailout, at a hearing.

Deep thoughts from X-GSfixr’s world……

-Deficit spending doesn’t matter. Sorta like the NFL Salary Cap. Ever noticed how the salary cap is never a problem, if the owner REALLY WANTS the player?

The only time it applies is when the owner is negotiating a contract with a player/employee the team owner thinks is replaceable.

-The scenario:
1) Wall Street burns up 2-3 Trillion dollars on overpriced houses……..money just disappears, only thing to show for it is too many houses, and 10-figure balances in their savings/checking accounts.

2) The Fed prints 2-3 trillion to replace the burned up money, and gives it to Wall Street.

3) Wall Street eventually makes this money disappear, by charging each other selling securities back and forth to each other.

Question:
How is this inflationary to J6P?

Mafia digs in as Italy’s biggest ‘company’ *Mob thrives on credit crunch, unemployment *May target bourse to launder profits.

ROME, Jan 27 (Reuters) - Italy’s mafia crime syndicates bucked the recession in 2009 to raise ‘profits’ by almost 8 percent with the financial crisis making companies and even the stock market even more vulnerable to cash-flush mobsters.

“Mafia Inc. is reinforcing its position as the number one Italian company,” said a report published on Wednesday by a body whose members bear the brunt of mafia extortion and crimes, the small business and shopkeepers’ association Confesercenti.

It estimated that the impact on business equalled about 7 percent of Italy’s economic output, enjoying healthy growth in a year when the Italian economy shrank by almost 5 percent.

Experts had predicted when the crisis began that Calabria’s ‘Ndrangheta, with its huge slice of the global drugs trade, Sicily’s Cosa Nostra, Naples’ violent Camorra and Puglia’s Sacra Corona Unita would see more demand for loan-sharking.

But the report said mobsters had also been able to launder their earnings by buying up cheap assets and had found a cheap and willing workforce among the newly unemployed.

“In times of crisis the Mafia’s money, even though it is dirty, makes people’s mouth water,” the report says.

The old: “In God we Trust”

The new: “In China we must”

The old: “Let them eat cake”

The new: “Let them drop fries”

More “green shoots” news………

The trophy wife of my (former) employers CEO just got a new seven series BMW, to replace her two year old Acura SUV. I’m sure the 2-300 employees that were laid off in 2009 will be glad to hear that the recession is over.

Jan. 27 (Bloomberg) — The Federal Reserve restated its intention to cease buying $1.25 trillion of mortgage-backed securities in March and maintained its pledge to keep interest rates near zero for an “extended period,” opening a rift among policy makers for the first time in a year.

Kansas City Fed President Thomas Hoenig dissented, saying the time had come to change the promise to keep rates low. The economy “has continued to strengthen,” the Fed said in a statement today in Washington, “although the pace of economic recovery is likely to be moderate for a time.”

Time Warner Cable plans 350 metro-Denver job cuts.
Denver Business Journal

Time Warner Cable is eliminating hundreds of jobs from its national network management center in the south Denver metro area as part of a national realignment.

The cuts affect employees a network operations site in unincorporated Douglas County and a call center in Centennial. Employees were told Tuesday.

The New York City-based company, the second-largest cable operator in the U.S., is restructuring its management of national network operations and consolidating some of those functions out of Colorado, Gordon said.

“In total, we notified 350 people,” said Jim Gordon, a company spokesman. “In 90 days, we’ll begin winding down those services.”

That iPad sure looks huge.. 9 inch screen but it’s gotta be 13 inches square? MAybe it’s the way Jobs is holding it..
$500.
$630 if you want 3G.. and evidently an AT+T plan is mandatory on top of that. Then there’s the proprietary formats… sigh..

While it might compete with that POS Kindle, it won’t get me away from audio books on my little mp3 player.

Why doesn’t someone come up with a practical, affordable, high res wifi video goggle. I’d consider buying that.. and stick a TV tuner in there while you’re at it.

Nicolas Cage is Leaving Las Vegas after $8.5m mansion sells for nearly half the price he paid for it. Daily Mail Reporter ~ 27th January 2010

A Las Vegas mansion bought by actor Nicolas Cage for $8.5million has been sold for nearly half the price.

The 4,300-sq.-ft, six-bedroom home was foreclosed by the bank recently after Cage ran up a $6.3million tax bill.

A mystery buyer put down $4.95million for the Spanish Hills home after less than a day on the market.

The lavish home, which Cage bought in 2006 before the property crash, included a 16 car subterranean garage, a private cinema and stunning views of the Las Vegas strip.

Estate agent Ken Lowman, who sold the house on behalf of the bank who foreclosed the property, said he believed Cage had bought it as an investment.

http://www.telegraph.co.uk/finance/financetopics/davos/6990433/Significant-chance-of-second-financial-crisis-warns-World-Economic-Forum.html

‘Significant chance’ of second financial crisis, warns World Economic Forum

There is now more than a one-in-five chance of another asset price bubble implosion costing the world more than £1 trillion, and similar odds of a full-scale sovereign fiscal crisis, a key report warned.

They’re soliciting questions for the Pres. on the Internet. The top-rated ones will be answered by him. Let’s get a good housing-bubble question in front of him. Here’s mine

http://bit.ly/bPveql

Vote it up, or suggest your own, and I’ll vote it up!

Jan. 28 (Bloomberg) — Japan’s retail sales unexpectedly fell for a 16th month in December as dwindling paychecks and deteriorating job prospects weighed on consumers in the world’s second-largest economy.

Sales slid 0.3 percent from a year earlier, the Trade Ministry said today in Tokyo. The median estimate of 12 economists surveyed by Bloomberg News was for a 0.3 percent gain.

The benefits of the nation’s export-led recovery haven’t spurred hiring or paychecks for the nation’s households, hurting companies including Right On Co. Today’s report indicates the stimulus from emergency government spending that helped pull the nation out of a recession is starting to fade,

After a trend of 16 months how can a fall be called unexpected?

Despite their tough talk about clamping down on pay, banks and securities firms are using other financial perks to ease the toll on employees.

Bank of America Corp. and Citigroup Inc. are doling out shares that employees can sell within months—much sooner than normally allowed. Other giant banks, including Goldman Sachs Group Inc. and Royal Bank of Scotland Group PLC, let certain employees borrow money to relieve personal cash crunches. And some U.K. banks have considered raising base, or cash salaries—funds that won’t be subject to the country’s new 50% tax on bonuses.

Such moves are a contrast to concessions recently made by large financial firms in hopes of defusing public anger, and political retaliation, over the comeback of sky-high compensation. Many banks and securities firms are paying bonuses with a bigger percentage of stock. Goldman, for example, sharply reined in pay and benefits during the fourth quarter. This week, the firm told partners that 60% of their 2009 bonuses will be in the form of restricted stock.

The new pay culture is squeezing bankers with hefty mortgage payments and private-school tuition bills—and has prompted some companies to find ways to assist cash-squeezed employees.

Ha !
the poor bankers can’t afford their hefty mortages and private schooling Please.

Did I correctly understand the POTUS to say he was going to make sure home prices keep going up?

Predicted results of further housing price support:

- Renters are screwed a bit more (but it’s all good, because the majority of householders (aka voters) are homeowners)

- New entrants to the housing market are priced out

- Homeowners of record are priced in forever

- Banks get to unload toxic MBS at inflated values

- Realtors get to sell fewer homes than they would be able to if
prices reverted to fundamental affordabilty

Does this story have any significance whatever?

HUD secretary stays home from Obama speech
The Associated Press
Wednesday, January 27, 2010; 9:08 PM

WASHINGTON — One member of President Barack Obama’s Cabinet has been picked to watch his State of the Union address on television.

Housing and Urban Development Secretary Shaun Donovan has been tapped to stay away from the speech in case a calamity were to strike the Capitol.

The White House typically selects one member of the Cabinet to remain in a safe place and skip attending the event that draws the Cabinet, top White House officials, Congress and the Supreme Court.
…

Jan. 27, 2010
Copyright © Las Vegas Review-Journal

Obama’s housing marks slipping

More in survey give president ‘D’ or ‘F’ grade than ‘A’ or ‘B’

By HUBBLE SMITH
LAS VEGAS REVIEW-JOURNAL

President Barack Obama’s first-year grades have dropped significantly in the subject of the U.S. housing market, a survey by California-based Trulia dot com showed Tuesday.

The president has not lived up to his promise to stabilize the housing market, Trulia Chief Executive Officer Pete Flint said in a conference call.

Obama received an “A” or “B” from 37 percent of respondents to the January survey conducted by Harris Interactive, compared with 54 percent in February 2009. Thirty-eight percent gave him a “D” or “F.”

“Housing obviously touches many facets of the economy,” Flint said. “Homes continue to lose value, and we’re on pace for record foreclosures in 2010. President Obama has fallen short on bringing stability to the housing market in his first year in office.”
…

After acknowledging the housing bubble’s role in creating the boiling pot of stew in which the U.S. economy resides, he went on to suggest home price reflation is part of the recovery plan. I guess hair-of-the-dog hangover cures remain a popular remedy with the Obamanomics Dream Team members. I suppose the path back to prosperity could also be built on a housing bubble and financial speculation?

Politics and commentary, coast to coast, from the Los Angeles Times

Obama’s State of the Union address:
The narrative of the past and future
January 27, 2010 | 6:35 pm
…
The president tried to climb out of that rut by first looking backward, and Janus-like, then looking forward.

After explaining his efforts to create jobs, Obama added that even with the best of work, it won’t be enough.

“These steps still won’t make up for the 7 million jobs we’ve lost over the last two years,” Obama said.

“We cannot afford another so-called economic ‘expansion’ like the one from last decade — what some call the ‘lost decade’ — where jobs grew more slowly than during any prior expansion; where the income of the average American household declined while the cost of healthcare and tuition reached record highs; where prosperity was built on a housing bubble and financial speculation.”

Can Government Fix The Struggling Housing Market?

January 27, 2010

President Obama is expected to talk about jobs in Wednesday’s State of the Union address, but should his administration be doing more for the housing market? William Wheaton, professor of economics and urban studies and planning at the MIT Center for Real Estate, says there’s little the government can do to fix the housing sector.

Writing books about the causes of the financial crisis is on the verge of becoming a new industry sector unto itself.

David Callaway

Jan. 28, 2010, 12:01 a.m. EST

Who’s really to blame for the global crisis?
Commentary: ‘Complicit’ points finger beyond Wall Street

By David Callaway, MarketWatch

SAN FRANCISCO (MarketWatch) — The short list of who’s to blame for the global financial crisis grows longer with each Congressional hearing, as the collective fear that gripped the financial markets a year ago slowly yields to a natural desire in society to find a scapegoat to pin it on.

Alan Greenspan, Ben Bernanke, Henry Paulson, Timothy Geithner, Dick Fuld and Lloyd Blankfein have all come under fire for stoking the financial bubble that burst in late 2007 from Wall Street to London and Riyadh to Reykjavik. Like Enron’s Ken Lay and Wall Street’s Ivan Boesky before them, they are convenient, flesh-and-blood targets for baying politicians and people to blame for a series of unprecedented events that nobody — least of all them — can still completely explain.

A new book out next month seeks to lend some much-needed perspective to the crisis, and place it in the proper historical context of generational outbursts of collective madness, such as the Dutch tulip craze in the 17th century, or our own Internet stock frenzy a decade ago. “Complicit: How Greed and Collusion Made the Credit Crisis Unstoppable,” by Mark Gilbert, comes out on Feb. 10.
…

Equities looking to break critical support!!!