Bits Bucket For February 7, 2010
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Who Dat?
Colts 34 Saints 17
I got the Colts 34, Saints 27.
I will be watching reruns of The Beverly Hillbillies and plucking my eyebrows. Brett who?
You mean plucking your eyebrow?
Colts 27
Saints 17
But I’m for the sAints.
Hey, sloth, not bad. You got it almost exactly backward.
Jeff was a little closer but switched up.
A lot like my stock picks.
I was just about to say the same thing.
Brett’s not playing today NYCB- Drew and Peyton. Remember to pluck from the bottom more than the top to properly shape them.
Yup, even us gals know Brett lost a while back. In fact that’s why I won’t bother watching today…no QBs representing us senior citizens.
I believe my point was missed. Being from Minnesota makes me care for this Super Bowl about as much as I care for having somebody stick a knitting needle through my eye.
Yes sir, your point was missed. But we shoulda gotten it, we DO know you’re from Minnesota. ok, ok…
Saints 34 Colts 10
Geaux Saints!
Roidy
WHO DAT!
Saints 31
Colts 17
Roidy
Did the PPT come into the game during the fourth quarter to rescue the Saints’ score?
Good call, Roidy. Congrats- you guys were due.
Laissez les bons temps rouler.
Does the PPT have any pull with football scores?
Some Crazy Super Bowl Prop Bets Offered For Colts-Saints Clash by BetVega.com Sports
1. What will the TV Nielsen Rating be?
Over/Under 42.5
2. How long will it take Carrie Underwood to sing the National Anthem?
Over/Under 1 minute 42 seconds
3. Which Super Bowl commercial will have a higher rating on USA Today’s annual Ad Meter?
Anheuser-Busch / Budweiser 2/3
Doritos 9/4
Coca-Cola 13/2
Go Daddy.com 8/1
Career Builder 8/1
Family First 12/1
Other 5/2
4. How many current NFL Players will be arrested during Super Bowl Week?
Over/Under 0.5
5. What color will the Gatorade be that is dumped on the head coach of the winning team?
Yellow 1/1
Clear/Water 7/5
Orange 4/1
Lime Green 5/1
Red 12/1
Blue 12/1
6. Who will the Super Bowl MVP thank first?
God 4/5
Teammates 8/5
Does not thank anyone 4/1
Family 11/2
Coach 10/1
7. How many times will CBS show Archie Manning live on TV during the game (from opening kickoff to final whistle)?
Over/Under 2.5
8. How many times will CBS show Eli Manning live on TV during the game?
Over/Under 2.5
9. How many times will CBS show Kim Kardashian live on TV during the game?
Over/Under 2.5
10. How many times will CBS show Tony Dungy on TV during the game?
Over/Under 1.5
11. How many times will CBS show Bourbon Street on TV during the game?
Over/Under 2
12. How many times will CBS announcers fully mention Hurricane Katrina during the game?
Over/Under 3
13. Which CBS show will get the most promo’s during the game?
Undercover Boss 1/1
CSI Miami 7/2
NCIS 4/1
CSI 5/1
NCIS LA 10/1
Big Bang Theory 10/1
How I Met Your Mother 10/1
Two and a Half Men 14/1
14. How many times will Pete Townshend do his legendary windmill move during the halftime show?
Over/Under 5
15. If any member of the Who smashes their guitar during halftime, what does the guitar hit first?
Floor 2/3
Speaker 2/1
Microphone 3/1
Drummer 100/1
Fan 100/1
I’ll take Pete and the over on the windmills.
If one spin counts as one windmill, then that’s a good bet. But do they mean five ’sets’ of windmilling? If that’s the case, I’ll take the under.
And what’s the over/under on his patented stage jump?
I say less than three. He’s getting old.
And does Roger still do his mike spinning in the age of wireless?
CBS probably won’t show Tony Dungy at all. He’s a commentator for NBC.
Geez couldn’t Lady GaGa sing the anthem….after all we must sell corporate music everyday
When are they going to have Alvin and the Chipmunks? Those dudes have range!
Let’s get Susan Boyle…yeah she’s Scottish but heck the halftime’s been English for years…
My kids were trying to guess the age of The Who band members. One thought eighty; another thought sixty-to-seventy. All were impressed when I told them the band was popular when I was around their age…
Watch out for the last five minutes of the last quarter; my money is on the PPT!
Al-qaeda in overtime!!
(it’s a joke, don’t get your knickers in a twist)
China in OT
Time to go make some killer guacomole sauce — ummmmmm…
Goes good with salsa sauce?
Use a few shots of jalapeno hot sauce to spice it up enough so the kids don’t eat too much of it…
Tell them the secret ingredient is you blew your nose in it.
My guaco is not that mean and green…
Q: What’s the difference between brocolli and boogers?
A: Kids won’t eat brocolli.
My kids do eat brocolli (and so far as I know, don’t eat boogers…).
Mmmmm mmmmm mmmmm; barac oli!
Comment by Professor Bear
2010-02-07 15:35:00
My kids do eat brocolli (and so far as I know, don’t eat boogers…).
———————
They eat boogers when you’re not watching (trust me on this one).
Mmmmm. I’ve been eating mine. Fresh guac is gooooood.
Professor Bear’s Souper Sunday Guacomole
4 ripe avocados
2 ripe tomatoes
1 lemon
¼ t turmeric
¼ t sea salt
8 peppercorns
¼ t Louisiana hot sauce
2 garlic cloves
1 t extra virgin olive oil
1. Bring three cups of water to a boil in a medium sauce pan, then blanch tomatoes for one minute; strain tomatoes through a colander when through and set aside.
2. Grate lemon peel to make ¼ t fresh lemon zest.
3. Slice lemon in half and squeeze out all the juice into the large, flat-bottomed bowl in which you put the zest.
4. Add turmeric to lemon juice mixture.
5. Place sea salt and peppercorns into mortar and pestle.
6. Grind peppercorns to a fine consistency.
7. Add garlic cloves and olive oil to mortar and pestle, then mash to a smooth consistency; transfer garlic mash to the bowl w/ lemon juice mixture and stir well.
8. Peel tomatoes and add to the lemon juice mixture; gently mash tomatoes with a potato masher until well blended.
9. Peel avocados, slice in half to remove seeds, and add to bowl containing other ingredients; mash avocados to a smooth consistency.
10. Use a spatula to transfer guacamole to an appropriate sized Tupperware container; cover with lid and hide in deep recesses of lowermost shelf of the refrigerator, well hidden from children, until game time.
It took my kids ten minutes to disappearate 2/3 of the batch…
I’m boycotting this year.
Upset ‘cuz they’re not running those gay dating service ads, ay, Bill?
Nope. Upset because of the advertisement of the so-called “pro-life.”
I’m against any marriage anyway, so I don’t care if the fascists ban gay-marriage.
There’s a form of boycott called “let’s change the channel for thirty seconds” if you don’t like a commercial. Just sayin’
In Canada I won’t have to worry about boycotting ads - the Canadian networks are allowed to substitute their own ads. So we’ll get ads for Apple Auto Glass, Hinterland Who’s Who, AMJ Campbell’s cheesy stop action ad that was first aired in 1999, Cottenelle bathroom tissue, the Slap Chop, and government propaganda about Worthy Canadian Initiatives.
Or something like that…
I’m boycotting this year.
gee no jury duty, no super bowl. you should change your screen name to “opt-out Bill”
It’s a free country but it bugs me. I went to my town’s Board of Finance meeting last month. wanna guess how many private citizens were in the audience? Just me. the town has 20,000 people and a budget of $50 million.
This is a microcosm of the country. No shortage of pissing and moaning, but zero participation. In the taxpayer group that i am a a part of I am the only person there under 60 if not 65 years old.
People whine “it won’t do any good” “it won’t make a difference”.
The irony is that, given the dearth of participation, any single participants impact is multiplied exponentially.
You’re so right that it does matter. Congresss esp. notes the volume of contacts. I call my Congress critters all the time. And the White House comment line 202.456.1111.
You must be retired then. You have the time to go to { sarcasm on } interesting meetings { sarcasm off } of statists. I guess you will have great bedtime stories for your grandchildren of said meetings. They will fall asleep fast!
President Obama Says Stop Watching Cable News. And He’s Right
By JEFF BERCOVICI4:30 PM 02/04/10 People, Media
On Wednesday, President Obama had something of a Howard Beale moment. Speaking to a group of Democratic senators, the President exhorted his listeners — and, by extension, all Americans — to break the cable news habit.
“If everybody here turned off your CNN, your Fox, just turn off the TV, MSNBC, blogs, and just go talk to folks out there, instead of being in this echo chamber where the topic is constantly politics,” Obama said, things would be an awful lot better in Washington
Then WTF is Obama doing an infomercial for on the superbowl pre game show. Thank god for the NFL channel.channel.
“If everybody here turned off your CNN, your Fox, just turn off the TV, MSNBC, blogs, and just go talk to folks out there, instead of being in this echo chamber where the topic is constantly politics,” Obama said
Obama to Hold Bipartisan Summit on Health Care BuzzPermalink By JEFF ZELENY
Published: February 7, 2010
WASHINGTON - President Obama said Sunday that he will convene a half-day, bipartisan health care summit at the White House on Feb. 25 to be broadcast on television, so Americans can see Democrats and Republicans try to break the deadlock on health care legislation.
The president made the announcement in an interview on CBS during the Super Bowl pre-game show. The meeting would mark the first time in the long health care debate that leaders from both sides would be allowed to air their ideas publicly and see if they can find agreement.
My former boss got a notice from his daughter’s school that parents could come in and preview the s*x education film they were going to show the 5th graders. His wife was the only one who showed up. The movie was really explicit so she went to the principal and said she didn’t think they needed to see all that. The principal took a look at the movie and said, “Oops, we showed the wrong one!”
People whine “it won’t do any good” “it won’t make a difference”.
The irony is that, given the dearth of participation, any single participants impact is multiplied exponentially.
———————–
Totally agree with this, and have seen it personally.
Bill, do you happen to have a slight dog that you tie antlers to before descending into Whoville?
That too. I stole Christmas and changed it to Xmas.
Very funny, dareal!
Close, but backward. Who says the South won’t rise again?
I just saw the news that NO won. Now I just googled the super bowl and stock indicators. Also I was ignorant on which conferance NO is in. Got that now. NFC.
So…the supserstition is that this will be an up year in stocks because the NFC won the Super Bowl.
Anyone on board?
Football is a Republicans’ game. It’s a Republican year. November 2010 will be a Republican landslide. Not that I’m a Republican (I’m a hedonistic atheist). But I am primarily into stocks.
“Treasury Secretary Timothy Geithner (GYT’-nur) says the U.S. government “will never” lose its sterling credit rating despite big budget deficits and a newly increased debt limit that now tops $14 trillion.”
http://hosted.ap.org/dynamic/stories/U/US_GEITHNER?SITE=FLDAY&SECTION=HOME&TEMPLATE=DEFAULT
Does anyone really expect the Secretary of the Treasury to say anything different?
That was a close call. Thank god we have a man of such high integrity and wisdom reassuring us. Just think how frightening this would be if we had a weasly, little slimeball that cheats on his taxes telling us this. Nobody would believe a guy like that.
And thank god we have such a dynamic decisive president of such integrity to guide us through this most difficult time.
pressboard
Your comment can be evaluated on its own merits, but I was wondering , why do Obama’s detractors frequently criticize him as only being good with a teleprompter?
He seems as good ad libbing, or even better, if you saw him take questions from the Republican House members last week.
I think Michelle got a manufactured job from that hospital, and he got a sweetheart real estate deal from the Chicago developer. He handed off the health care bill to Max Baucus (as a proponent of nationalizing the healthcare system, I found that unforgivable).
All in all though, in terms of capacity for cogent speech or critical thinking, isn’t the comparison from the last president to this one similar to that of a horse and buggy and an automobile? No?
I understand that it’s regrettable that my point of reference comes is such a low water mark.
Politics aside, Obama needs to lose the teleprompter tho.
It’s getting embarrassing, never making direct eye contacts with public, just moving the head from the left to the right, it’s really freakish. Even the past guy who was a bumbler didn’t rely on the totus so much. This guy is pretty good at talking, lose the totus.
Re: freakish appearance when speaking publicly
never noticed (but will make a point of it now)
“I understand that it’s regrettable that my point of reference comes is such a low water mark.”
Coudn’t agree more. Which is worse: Stepping in a dog-turd, or stepping in monkey feces? Why do we have to trod on turds as our only choice? As to the distinctions regarding the finer turd, who cares?
I use a teleprompter when I make presentations! It makes a big difference.
We produce a lot of video “status reports”, and the prompter makes a big difference in the quality of the output.
In fact, I’d suspect that many of the top YouTubers who make these seemingly amateur videos that get millions of view are much more professional operations than they seem.
Anyway, of all the things that I criticize Obama for (like taxing savers and workers so his deadbeats can live in free houses, and trying to keep the housing bubble inflated), the TeleprompTer isn’t on my list.
I guess I missed the time Obama was able to talk intelligently on issues without a teleprompter. His statements are filled with contradictions, and lack substance. He just spouts bs he thinks dumb people want to hear. If you have no substance, the confidence and clarity with which your words are presented is of no benefit. It reminds me of a televanglist. A whole bunch of confused nothingness by a self proclaimed expert that wants to rob you but claims to have your best interests at heart.
gee Natalie unfotunately I agree with you about a lot of that. I wouldn’t blame the teleprompter though.
and don’t forget, he still compares favorably with his predecessor.
I used to cringe every time Bush opened his mouth. So many intelligent, successful, decent & articulate people in this country, and that was the best we could do?
I hear you but sometimes think that a lot of people get a bad shake because of their poor public speaking skills, and some get an unfair advantage because of their ability to bs. I have known several people that were good speakers (as far as confidence, clear sentences, a few jokes, and audience approval) but were flat out wrong, and several people that could not speak well (i.e., nervous, use of sentence fragments, making up words, boring, etc.) but were always, or usually, right on the substance. I have learned to not judge based on what people say, but on their accurateness and reliability. I think Obama is one of those with an unfair advantage. Unfortunately most people dont understand the issues enough to know bs when they hear it, and just voted for blind change.
“what people say” should have been “how people say things”
Natalie,
Bush was inarticulate AND clueless.
“Mission Accomplished.” Heckova job, Brownie. Don’t remind me of those years.
Exactly Sammy;
The decider, The ownership society,
I agree with Natalie - I’ve never been overly impressed with Obama’s speaking.
When he’s using the teleprompter, he’s unnatural and somewhat stilted and stiff…and when he’s not using the teleprompter he’s sloppy and has a tendency to make callous, insensitive remarks.
He’s a better speaker than Bush was, but so was just about everyone else. And don’t even get me started on Biden.
I agree. Obama’s a decent speaker, but he’s no great orator. And he’s more glib than eloquent. Compared to Bush, of course, he’s Winston frickin’ Churchill.
Maybe he should write notes on his hand, eh?
You betcha!
If Geithner is right, bond yields will stay low. If he’s wrong, there will be a selloff of bonds and yields will rise.
The big question is whether the Fed will be willing and able to continue supporting the former NY Fed president’s statements through their T-bond purchase (aka yield buydown) program.
“the U.S. government “will never” lose its sterling credit rating despite big budget deficits ”
Timothy Geithner will be run out of office by Aug 2010.
Timmy is currently undergoing one rhinoplasty a week, to keep up with his telescopic nose.
A surgical scalpel is a scarce and expensive tool (at least when operated by a surgeon). Wouldn’t a Boy Scout pocket knife suffice to carve a wooden nose?
Actually, scalpel blades are very cheap, and the handles are resterilized. Why ruin a kid’s precious pocket knife? Geithner is toast. Who will replace him?
Why would Obama dump him?
Reminds me Rumsfeld during the invasion of Iraq…it was the policy not the suit making the presentation that ws the problem….anyone here predicting a COURSE CHANGE by Obama?
(please note that i said predicting not hoping )
Tiny tim will be gone withinn two months.Back to misfit island.
Back to his underwater NYC single family residential investment property…
I predict he will be gone within 6 months and will decide to convert his single-family house to condos. They won’t sell either.
Only after destroying Obama’s presidency to the fullest.
Obama has the power to save himself
Are you in the market for a bridge? I have one to sell you.
Or he could resign and save us. Along with Joe Biden and his entire cabinet, of course.
That would put Pelosi in charge.
+100 good one alpha-sloth
i winder if it wouldn’t be an improvement anyway.
i am still a little miffed about her profligate spending on her official outings. Funny, i’m, unfortunately, inured to the profligate spending by the government
That would put Pelosi in charge.
I’m emitting a shriek so loud and high-pitched that dogs on both coasts are pricking up their ears.
Is that why my dog was pacing back and forth? : )
Obama has the power to save himself the way Clinton saved HIMself. Wake up and do something “bipartisan” by going DIRECTLY to the opposition. Well, uh, maybe he has to wait till November to get away with that. We’ll see.
Nycityboy
seems that geitner works at Obama’s pleasure…or Obama could give him different marching orders.
Obama could ride the populist anti-banker surge and be the first president to GAIN House seats in an off-year election.
Obama could, Obama could….I am not so naive as to think Obama WILL……but ….
isn’t it analagous to a parent that watches his seven year old run amouk in the living room, wrecking everything while the parent watches? The kid wrecked the living room like Geitner wrecked Obama’s presidency…got my point?
I’m voting in 2012 for whichever candidate does the best job of surfing the tsunami wave of anti-bank populism. May the best candidate survive surfing the 130 foot high wave…
atta boy PB….who are the early nominees? we all like that grayson right? what about Russ Fegngold from Wisconsin?
Russ might be available. He will struggle to maintain his senate seat this fall.
JDCT, Have you ever stepped back a moment for a critical assessment concerning the degree to which your surroundings - post-industrial CT, home of ‘gimme’ politics, holding the record (since 1980) for per capita public office holders under Federal indictment - has affected your knee jerk Obama encomiums? I guess if I were still there in the land of ‘gimme’, I might be similarly affected. An alternative approach might be to note that all public office holders are corrupt. Perhaps its part of that power-seeking gene.
The only way to tame psychopaths is to rule them through fear, before they re-establish the baksheesh networks their predecessors had in place. Therefore, our most effective political strategy - speaking as a citizen - is to routinely vote against the incumbent. It would also help to get a new gene pool in Congress and the Executive branch. From that standpoint, rejoice in the ascendency of Middle Americans like Palin. Elmer Fudd could not have done worse, based on our stripmined economy. Therefore, IMHO, up with the flyover candidates!
The backlash against Palin comes out of fear. She is not part of the East Coast liberal intelligentsia, nor is she shackled by monied interests. Ergo, she is the greatest conceivable threat to the pocketbooks of the entrenched pigmen. I say get another 300 like her into Congress, the Presidency and the Cabinet.
At least the flyover candidates have personal experience with the results their predecessors have wrought.
The backlash against Palin comes out of fear.
Even if she’s the idiot they say she is, that doesn’t make this any less true.
You know, pressboardbox, I’m really beginning to believe that the Fed Gov’t and the FED really don’t understand what they are doing nor how we got here which is why the Fed G and the FED persist in smooching Wall Street’s Armani-suited hind-quarters. They don’t know anything else to do at the moment.
How did we get here? It isn’t just housing or failed regulators or greedy WS or greedy housing speculators or securities raters (AAA for CCC) or over leveraging or Glass-Steagle or Sub-prime or Mr. Magoo (aka Alan G.) or George W or George HW or “Cigars” Clinton or foreign banks or NAFTA or BRIC or China or 9/11 or Iraq or Afghanistan any one thing. It was all of that and more. It was the age in which we live - the result of a collective “US” all over the world. Mr. Magoo has a point when he said it was “human nature” which in no way exonerates the old fool.
All of that being said, I believe that the FED, Fed G, Euro-Union, central banks all over the globe, do not “know” nor do they “know that they don’t know.”
I’ve been a participating HBB’er for a while now and have a very dark vision of a “coming storm”.
The “solution” is not as easy as more “liquidity”, “QE”, or “stimulus” to try to midwife “Consumerism 2.0″. The world keeps trying to get back to “maxing out the plastic at the Mall.” That won’t work and will have horrific results if pursued.
We won’t bail out another crash. There will be blood in the streets if that is tried. That will precipitate another war - a big one. Personally, I’m tired of the two that we have, but that is another post for later.
Roidy
I think I detect a theme in your post, which I will label Tapped Out:
- Going it (almost) alone in two wars
- Building up an enormous fiscal deficit in a futile attempt to reflate a credit bubble
- Allocating funds towards Green Energy and other climate change mitigation programs, despite a growing preponderance of evidence that the peer review system that delivers climate science is broken
TAPPED OUT
Sorry, P.B., but there is not a “growing preponderance of evidence”, quite the opposite. I can also tell you, from personal experience, that things are warmer. I do a lot of climbing and hiking in Washington State. You would be astounded how much glaciers have retreated in the past 20 years. I was on Rainier (north face) last year and it was almost bare. It was scary to see. The Cowlitz glacier has retreated, literally, miles. It used to be down to the road, now you can’t even see it. There used to be ice caves near Paradise (on Rainier), now there’s not even ice. This is because IT’S WARMER. Snow fall is about the same, but the ice melts faster because of the temperatures. This is real.
Are you suggesting this is man-made climate change that can be stopped without inflicting catastrophic damage on the world economy? Just give me the word, because I would like the opportunity to purchase myself a bicycle before the masses catch on to your insight.
There are much bigger forces in play (the Sun, volcanic activity) than man and his internal combustion engines.
Anthropogenic Climate Change (formerly marketed as “Global Warming”) is an elaborate tax hoax, with Al Gore, Goldman Sachs, the UN, and other players acting as for-profit middlemen.
there are theory for slowing the heating temporarily…..
Man made climate change is real, and cannot be stopped w/o massive damage to the world economy. My prescription is, party on! The human population will be reduced by all the usual Malthusian processes. War, famine, and plague. It won’t be pretty, but it may give a few other species a chance to survive.
- az_lender, a former contributor to the Journal of Climate, Journal of Geophysical Research, Journal of Quant. Spectroscopy & Radiative Transfer, Geophysical Research Letters, etc etc. (And I might add, BEFORE the game was very political.)
I had a feeling that you were a retired scientist, az_lender. Do you miss it? I’m looking forward to retirement in a couple of years and would like your perspective.
“[g]rowing preponderance of evidence that the peer review system that delivers climate science is broken”
Naw, the science and evidence is there, what is growing is the diversionary smoke blowing tactics of those who don’t want to change business as usual.
They’re kind of like real estate types @ the end of the bubble -you know, the ones who believed they could say “there is no bubble, there is no bubble, there is no bubble” and click their ruby slippers 3 times & voila no bubble.
“The human population will be reduced by all the usual Malthusian processes.”
Sounds like we agree any contribution of anthropogenic climate forcing will pretty much be self correcting. If that is the case, why bother peremptorily derailing the global economy?
“Naw, the science and evidence is there, what is growing is the diversionary smoke blowing tactics of those who don’t want to change business as usual.”
Someone is in denial about the severity of the climate science peer review crisis. So far as the general public is concerned (you know — the people who vote?), climate science is a scam.
PB I agree with that completely.
REHobbyist, I don’t miss science most of the time, but yesterday at a Morro Bay Library book sale, I inexplicably paid 50 cents for a book entitled “Chemistry Problems and How to Solve Them.”
Going it (almost) alone in two wars ??
Exactly !! Why is this tolerated ?? I can only conclude that the Military Establishment both Government & private sector are just as corrupt as any on Wall Street…
Careerism, moral cowardice, and most of all, political correctness, permeate our military at all levels. The battlefield commanders and junior officers who display courage, creative intelligence, and integrity become discouraged by the risk-adverse, micromanaging, politicized higher echelons. They get discouraged and leave the military, while those who can’t hack it in civilian life make it a career. There are still lots of competent, dedicated people in the military, but they’re the exception not the rule. That was my experience, anyway.
A good officer must also be physically fit, and both look & act like leaders of men. Few of the specimens coming out of ROTC or the service academies these days meet that criteria.
Interesting point of view Sammy…
hey PB,
remember our discussion re: OJ….namely, even if there’s fake evidence pinned on a guilty man, he’s still guilty….
well just because one global warming scientist tries to squelch criticism about his favorite theory doesn’t make the theory bogus.
i have the feeling that even if the greenland ice sheet snaps in half many will still say “it wasn’t man-made”
(kind of like when home prices fall 20% year after year there will be those repeating the matra “it’s gonna come back, it’s gonna come back”)
It wasn’t “just one global warming scientist” — it was the entire peer review system for their discipline.
Whatever the uncertain truth may be regarding global warming, human versus natural causes, costs of acting now to fix it versus later, etc, the scientists engaged in controlling this research enterprise have boiled themselves in their own pot of stew with absolute certainty.
newsflash PB: the peer review system for ALL the sciences is under attack
Does that mean there is nothing new to be learned? Does that me can never believe any new information?
NO NO
it means we have to do a lot of discerning!
“the peer review system for ALL the sciences is under attack”
What does that have to do with Climategate, where a trail of e-mails suggests corruption at the highest echelon of the discipline (the one that controls their leading journals’ peer review process)?
I completely agree that there is a serious climate issue. I’m not entirely sure that human activity is solely to blame. Largely to blame… maybe.
Even if there weren’t a serious climate change problem, then we should still carefully husband our petroleum and natural resources. What are we going to leave our children and subsequent generations? We have a responsibility for this. Just as they will.
Now, PB writes “peer review system that delivers climate science is broken.” Oh yeah. It’s broken. The stuff that comes out is not critical to the end conclusion, but it does look like really incomplete peer review.
Roidy
It doesn’t matter what scientists”think” about climate change. We are in an Ice Age! That means wave of cold after wave of heat occurred millions of years ago up to the present and will continue on into the future. We can all grow fur and never burn a stick of wood again. The Earth could care less; there will be 1000s of feet of ice covering the landscape down to Manhattan. Get over it already! What happens during our little eye blink of geological time here is meaningless. Argue about something you can do to survive the next power failure or the next housing bust, things we might actually get some benefit from in a time frame that matters.
“Get over it already! What happens during our little eye blink of geological time here is meaningless.”
Hear hear!
The sole point of the efforts of the AlGores and Ahnolds of the world to pretend they hold all the climatic puppet strings — a completely ridiculous notion which is perfectly congruent with the overgrown egos of these asshats — is to hoodwink scientifically ignorant masses into voting for them .
The peer review system is fine; it’s the FUNDING system that’s broken. If you think Arizona Slim has to hustle for her next job…you haven’t seen your average scientist. Scientists have to do sales as much as any army of salesmen. And if the scientists promise to come up with data that your funders want to hear, then you keep you job.
If you’re interested in doing the science right and don’t keep an eye on your funding, then you lose your job. I have personal experience with this.
However, PB, please keep in mind that Green Energy does more than mitigate climate change. I’m thinking of national security and Peak Oil.
“…it’s the FUNDING system that’s broken.”
Totally agreed. And the entirely natural consequence is the potential for control over the flow of grant dollars to trump the priority of an independent peer review process which objectively selects the best science.
good post roidy
but fortunately this “US all over the world” and its corlollary homeownership for every citizen and an iphone in every pocket is more of a US phenomenon.
DD had a post late in the bits bucket a couple days ago about the average German’s lifestyle. My in-laws are French and I concur that they don’t seem to be as far down this road of consumerism/imperialism that the US is. IF there is a “great war” coming the US will fight it alone…even the Brits are losing their stomach for Afghanistan.
“I’ve been a participating HBB’er for a while now and have a very dark vision of a “coming storm””
Geez Roidy, think how many x___ MILLIONS of Americans who will no longer be able to “participate” in this “The Game of Life” …they must surely share & feel your ominous vision
“In a single transaction, about $110,000 / $220,000 / $330,000 / $440,00 …went into their personal bank accounts as the ESCROW closed on their houses between 2001-2005″
FREE Credit = x_____ 100’s of MILLIONS of peoples GLOBALLY = Dang, that didn’t work out so well…what are “we” gonna try next?
“You know, pressboardbox, I’m really beginning to believe that the Fed Gov’t and the FED really don’t understand what they are doing nor how we got here which is why the Fed G and the FED persist in smooching Wall Street’s Armani-suited hind-quarters. They don’t know anything else to do at the moment.”
Hey roidy,
These are not amateurs. These are professionals who dominate and control the nation’s economy and finances. Don’t cut them any slack in the culpability category.
Think of the “Federal Reserve” as the highest stage of criminal conspiracy known to man, and the “Federal Government” as the tin- badge-wearing cop-on-the-take who permits the wholesale rape and pillage of the citizens on his “beat”.
Corruption, graft, and bribery are the primary tools of the trade for modern banksters.
‘…do not “know” nor do they “know that they don’t know.”’
That kind of Rumsfeld problem sounds highly intractible…
As long as cash is king and king BB can print lots of cash, the US will never default. At some point, all US subjects will be millionaires.
We’ll be living under tarps and setting snares for squirrels and using dollars to start our campfires, but we’ll be millionaires.
You have to see the film “Into the Wild” Some dollar burning and squirrel eating amidst amazing natural scenery.
I noticed the DXY, also called the dixie, is up to 80. I think that has more to do with the Euro tanking than the US dollar rising.
“And they’re off!” Just ’cause we aren’t winning the race to the bottom, doesn’t mean we’re not in it.
Big Six banks urge Ottawa to tighten mortgage rules
http://www.theglobeandmail.com/report-on-business/big-six-banks-urge-ottawa-to-tighten-mortgage-rules/article1458585/
Some snips from the article:
The heads of the country’s six largest banks have privately told policy makers that they fear the wide-ranging economic fallout of a U.S. style binge-and-collapse in housing. To head off any chance of that happening, they are willing to accept tighter rules on mortgages that would slow the real estate market, even though it would mean forgoing some short-term profits from giving out ever bigger mortgages as home prices jump.
Then the gem:
That has led to pushback from some in the mortgage industry who argue that stiffer amortization and down payment rules for all buyers could undermine the housing sector and hurt Canadians by causing the values of their homes to drop. The average price of a house in Canada, is $337,410
Canada is going to fall hard, although I still think we are better off then AZ, NV and CA.
“That has led to pushback from some in the mortgage industry who argue that stiffer amortization and down payment rules for all buyers could undermine the housing sector and hurt Canadians by causing the values of their homes to drop”
That has led to pushback from some in the mortgage industry who argue that stiffer amortization and down payment rules for unqualified buyers could undermine their outsized compensation and hurt their lavish lifestyles by causing the prices of houses to be more in line with the incomes of Canadians.
Better?
NYCityBoy, couldn’t have put it better myself. I golf & curl with a couple of mortgage brokers and after a scary fall 2008, last year they were not hurting at all for cash!
ACKK! Mortgage banker!
I just found out that the 3rd dumbest kid in my highscool is now president of a mortgage banker association in wash. DC. (actually he’s in the Gov’t affairs division of the outfit)
I am perticlarly aware of intellectual ineptitude because I was his peer tutor for a long time. I only found out about it because he is apparently one of those people that takes a picture of a bottle of wine he buys, and then posts it on facebook.
For all I know he is a hardworker and good at his job now, but he was a class A dipshit in highschool.
Hey Chris. Do you have your own stone, like a bowling ball? Do you hang out at the curling alley?
“Canada is going to fall hard, although I still think we are better off then AZ, NV and CA.”
Canada has those kinds of places too, but they’re cities.
With the government already backing all the mortgages, ginormous Canadian National Debt is baked in the cake.
Changing market leads to tough times for developer
By Tom Daykin of the Journal Sentinel
Posted: Feb. 6, 2010
It was a different world for real estate developers when Boris Gokhman and his partners paid $10 million for the Fox Bay Building - nearly 50% over its assessed value.
That was five years ago this August. The Whitefish Bay building is best known for housing the Fox Bay Cinema Grill and other businesses. But the real prize for Gokhman and partner Walter Shuk, who operate New Land Enterprises, was its large parking lot. A year after buying the property, New Land, which has developed hundreds of condos and apartments in Milwaukee, proposed a four-story building with 93 luxury condos for the Fox Bay parking lot and an adjacent publicly owned parking lot.
Oh Yeah….”Then the music stopped”
http://tinyurl.com/yf4d6v3
Boris never seems to give up. he was nailed for medicare fraud back in 2004. Seems he billed medicare for over 3mm dollars for services he never preformed. Some jail time of course, but nothing serious for this russian immigrat. Oh, yes and Walter. Walter can tell you exactly what he ate for lunch, on Tuesday, November 5, 1980. Why, because Walter has eaten the same lunch every day foir his entire life. How these two guys got loans after the medicare thing…beyond me. They own 1466 Farwell, a 20 unit, 1945-43 Oakland, two 20 units, Knaap Street, a 20 unit and Prospect avenue, 13 unit. New land Enterprises. Boris went from nothing to one of the biggest developers in Milwaukee, in a period of 7 years.
Yes I agree Vancouver & Toronto (and suburbs) will fall as much as Las Vegas, however, I doubt a strawberry picker making $15K would get a $700K mortgage here.
Also, mortgage interest is not deductable, so most people I know are in under there heads for only 4 or 5x income, whereas I heard of examples of 7, 8 and 9x income in some of the worst areas of the states.
I rent b/c I love the freedom of moving if another job opportunity arises.
One of my biggest “holy moses” moments of the housing mania is when I went to Toronto in 2006 after a 10 year absence. The number of high-end condo towers boggled my mind.
My tale is my first visit to Toronto in 2004 after probably a 5 year break, is that all of the old parking spots we use to go for the Bluejay games (parents had season tickets) were now condos. Everything near the Skydome is now condos.
Why do the big six banks need to ask Ottawa to tighten lending standards? Can’t they simply tighten lending standards individually, on their own? Just say, “Sorry, *we* have higher standards”? In the short run, a bank that tightened on its own would lose some business to the other five banks, but in the long run, when the thing pops 2-3 years from now, it would be in a better position…
Oh, wait, did I say “long run?” BWAhahahaha!
The only way they can avoid losing to competition is to get the nanny state to cut off everybody at once. And then complain about the nanny state.
“but in the long run,” LOL! I coughed my espresso though my nose all over my youngest son. He’s not happy with me nor you.
Roidy
The only way they can avoid losing to competition is to get the nanny state to cut off everybody at once. And then complain about the nanny state.
Bingo! Good business practices require regulation. They don’t arise through competition, as the deregulators claim. They create the conditions that allow competition.
The news out of Greece seems awful quiet this weekend. It is amazing how tied together the entire world, and worlds within the world, have become.
A debt problem in Greece could threaten the European Union. That could cause the Euro to continue its plunge. That would make U.S. exports (if we still do that) more expensive for Europe. The carry trade would crash. Investors could be forced to scramble for dollars to get out of their credit trades (Combo). They might start jumping out of investments just to free up cash. This could send the stock market reeling. This would crush the repatriated profits of multi-national corporations.
We could be back to square one. Panic could ensue on Wall Street and at The Fed. Yet we all know there is little will for more bailouts and stimulus. Perhaps Mr. Bernanke will be the last to understand the extent of the anger at his choosing of winners (Fed clients) and losers (Main Street).
All of this leads us back to housing, the 1,200 pound gorilla that is running amok still. Can The Fed continue to buy up all MBS? Can Fannie and Freddie be the bottomless pits that many in power wish them to be? It all works until it doesn’t.
Greece is the next test but certainly not the last test. Portugal, Spain, Ireland and Italy await their 15 minutes of fame. California, and the state budgets, are under the bed making strange noises. As I sit here on an early Sunday I can think of so many scary things. I believe I better stock up on liquid assets. My personal favorite comes from Lynchburg, TN.
It all makes for interesting theatre. The efforts to continue the largest expansion of credit in history have been heroic. I still believe that the inevitable is not too far down the road, but it is all playing in slow motion.
Apropos items from Lynchburg (I still say the stuff from Ky is better) and doomed efforts to keep the expansion going, you implied the other day you had a still, Blue Skye. Is this the case? I’ve always been interested in distilling my own liquor, but I was unsure of the expense and difficulty.
BTW I ’still’ say that half-pints of cheap liquor would be a great hyperinflation hedge/survival currency. Even if you can distill your own, you still need energy and grains or corn of some sort, all of which would be hyperinflated and/or hard to get. And I bet when it came time to barter, people would look more kindly on even a cheap brand name whiskey or vodka in a sealed bottle as opposed to some homemade moonshine in a jar.
The old-timers were smart, they knew you could store your grain and corn ‘wealth’ as liquor, and not only would it not spoil with the passage of time, it would get better and increase in value! Beats a vinyl crapshack.
You working for them revenuers? We don’t take kindly to too many questions!
Fuel…..solar is easy. Slow, but easy.
Grains and fruit….live where they are plentiful.
Sheee-it, I ain’t no rev’nooer! Where was you at again?
I think firewood would work better than solar, if you live near woods where you can harvest it free. ( ‘Cept them rev’nooers can spot the smoke.)
Grains wouldn’t be so plentiful in a hyperinflationary collapse, as they would have great value. Growing your own in any quantity involves fertilizer, mechanical harvesting, etc. Again, all expensive in a hyperinflationary collapse.
Backyard or wild fruit is always an option, but first you gotta make wine with it (after the critters take their cut), then distill it into brandy. Again, a bit of work and expense, especially in collapse conditions.
And your end product is a homemade concoction in a jar. I’ll be bribing my way through the apocalypse with bonded bottles of cheap (but suddenly precious) half-pints of brand name vodka and whiskey. We’ll see who gets further. (You can’t drink gold! But I’ll trade you some whiskey for it, lad;)
You always have to make wine or beer or such first, then you have something to distil. I’ve some water cooler jugs that are usually bubbling with some brew. Back in the day, they say most of the apples went to applejack. No still, just freezing. I do enjoy a bit of that, but more than a glass or two and it’s like getting kicked in the head.
On the growing stuff, you don’t must have gasoline and fertilizer in a bag, really. You just have to spread things out in time and space and expect less production, and no monoculture.
Your plan is a good one, not because it will make you rich in the future, but because you won’t care! Stay mobile though, word would get around if you start trading bottles of booze.
My favorite college prof was a doomer back in 1970. He had a trunk of things for the post collapse. A few bottles of bourbon were prized supplies.
Of course, the “homemade concoction in a jar” can be advertised as a “natural” or “free range” product. Has to be better, and “greener” than a manufactured product.
Actually, I like your plan.
My current “inventory” acquisition list
-Ammunition and primers
-Drugs antibiotics
-Add hlf-pints of bonded whiskey and vodka. Or Everclear.
Seems like more three percenters online here than I would have guessed. Alkys, none the less, three percenters.
How do you say ‘bake-sale’ in greek?
“As I sit here on an early Sunday I can think of so many scary things.”
As I sit here drinking my java on what is to be a beautiful 60 plus degree day, with fruit trees already blossoming in a glow of pink, I’ll be thinking of heading out for Wm-S free comfort food cooking class and a stroll along the oceanside in Monterey. In the economy and housing what will be will be, you can’t fix STUPID!, but I can fix me. Saw a sign at a bike shop in Stanford that was positive “Be an American Idol not an idol American”. Next week it’s back to the gym to keep beating this ole body back into shape.
Shouldn’t that read, “idle American”?
I applaud your positive outlook. It is good to see. I hope you enjoy your day. The weather here makes me realize how little I miss Midwest winters.
Next week it is back to the bar to keep beating this ole liver back into shape. Your biceps may be more toned than mine but my liver is probably four times bigger than yours.
“Your biceps may be more toned than mine but my liver is probably four times bigger than yours.”
Sclerosis: “A hardening of tissues and other and other anatomical features.” - Wiki
Hard muscles are toned muscles, are they not?
So it follows that a hardened liver is a toned liver.
Well, actually, a hardened, “toned”, gigantic liver will probably get you listed for a liver transplant at some enormous medical institution eventually, and if you should live long enough with liver failure in order to get a tranplanted one, you will have to live with lifelong immunosuppression drugs, graft-versus-host disease (ugly, painful and horrible - look it up ), and possible transmission of hepatitis and other such maladies from the donor organ, plus costs of at least $ 2million for the first couple of years or 3, but hey, enjoy….LOL.
Killjoy….
Sorry.
Remind me not to go bar-hopping with Silverback1011.
To tell the truth, I’d be under the counter/table after the first two drinks, and you’d have to send me home in a taxi ! I’ll pay ya back later.
Just don’t let any Goldman Sachs upper management types roll you and take your wallet.
NYC Boy,
Just about everybody I know as a deep sense of unease about the economy. Yet probably not one person in twenty is even aware of the problems in the Eurozone (not to mention Dubai World, Latvia, and any number of other debt pyramids waiting to implode). Fewer still have any inkling of the true ramifications of the global and LOCAL impact when the worldwide economic house of cards starts to collapse. There will be mass panic and pandemonium on the markets, and possibly on the streets as well - and all the usual “experts” and Obama economic advisors will avow that “nobody saw this coming.” Housing Bubble redux.
And at that point the sheeple will start to reap the full measure of their just desserts for voting for the asshats who got us into this mess.
“And at that point the sheeple will start to reap the full measure of their just desserts for voting for the asshats who got us into this mess.”
Don’t forget that it will also impact those of us that tried to warn about this mess. There is no safe harbor when the storm covers the entire planet.
No, but some of us will be better prepared than others.
“There will be mass panic and pandemonium on the markets, and possibly on the streets as well - and all the usual “experts” and Obama economic advisors will avow that “nobody saw this coming.” Housing Bubble redux.”
I think there are some advantages to being aware of what may be coming, even if your options are limited as to what to do about it.
I’m more concerned about how the anger will be channeled from those that were clueless. They could do more harm from their ill-thought-out reactions than the direct impacts of a collapse.
They could do more harm from their ill-thought-out reactions than the direct impacts of a collapse.
exceellent point freg….i wonder what form those bad reactions might take? populist furor?
“i wonder what form those bad reactions might take? populist furor?”
I’m not sure. We can go back to the 1930s for some possible examples.
I could see the tea partiers acting like the brownshirts in Germany and sweeping into power people that would lock down the country. There’s nothing necessarily wrong with the anger that the tea partiers are feeling. There are lots of good reasons to be angry about the direction of the country, going back a few decades. But misdirected anger could result in a very bad outcome.
The tea party types seem like a mixed bag. Many or most probably have their heart in the right place. But turning to Sarah Palin as a savior? THAT’S the finger you want on the red button? Already Establishment Republican hacks like Dick Armey are oozing in to manipulate and co-opt the “movement.” Most of the tea partiers too ignorant and paranoid to form any kind of cohesive and rational opposition.
The biggest problem this nation faces is the mass stupidity and willful ignorance among the populace. If the economy really tanks, they’ll look for scapegoats rather than reflect on their own roles in the train wreck. It’ll be easier to blame “them” than to do a sober cause-and-effect analysis of what went wrong and why. Rather than sacrifice and hard work to get us back on track, they’ll want simple solutions. Every street corner will be sprouting its own demagogue foaming with some deranged, us-vs.-them vision for the future. I just hope common sense, restraint, and decency will ultimately prevail.
I’ve hung with some of these people locally and there is a maddening vagueness to their rants: We gotta do something, by golly, take back Washington, get the govt out of our business, safely diverting attention far away..I’ve noticed a few frustrated property owners, REICers, and former financial advisers among them. It’s someone else’s fault that their prospects recently went in the toilet.
That’s what bothers me most about them. Shouting slogans and waving signs and railing that Obama is a Kenyan Muslim isn’t very helpful in my book. To me, the “way back” for us as a country is each and every person being willing to admit their own fault in where things stand, and to start practicing true conservatism in their own sphere of home and family. And no, true conservatism doesn’t mean nailing up the Ten Commandments at every High School or (most idiotic of all) a Constitutional ban on gay marriage. It means being a net asset to society and not a liability.
Well seeing that something is wrong is easy. Figuring out how to fix it is hard. And even worse, it’s complicated. too complicated for a soundbite and therefore it won’t form part of the debate.
Forget it guys. The average Amercian is stupid because that’s the way the nearly $300B, 24/7 propaganda bombardment system wants them.
Stupid people make for more gullible consumers.
And that’s not cynicism, but fact.
Find a way to counter THAT, and then you have a chance.
“….railing that Obama is a Kenyan Muslim isn’t very helpful”
Yeah, I don’t believe this either. I’m thinking more of a Zimbabwean muslim.
“…. railing that Obama is a Kenyan Muslim ”
Well that is just ridiculous! He is much more of a Zimbabwean Muslim from what I can tell.
Clearly he is a Keynesian Muslim.
I agree with you on some foreign markets Sammy…All thats needed is some fuse to be lit that will accelerate the move…Me thinks its Iran..
More than half the world’s oil moves through the Straits of Hormuz in the Persian Gulf. If that flow gets interrupted for whatever reason, the cost of a barrel of oil will head for the stratosphere. That would send Western economies, what’s left of them, into a full-scale depression.
Why worry? The “Community Organizer” has Krugman, Rohmer, Reich, Bernanke and Geithner, an entire band of cheerleading Keynesian philosophers telling him the we can Spend our way to prosperity. Birds of a feather, so to speak.
With such a team of highly paid “experts”, there’s no problem we can’t print our way out of. If it isn’t working, what we need is more of the same. It worked for FDR after 12 years of not working (or was is the War spending followed by re-tooling afterward), so, like all dumb ideas, it’s bound to be policy for this administration.
We will spend our way to prosperity. And anywhere that any prosperity makes an appearance, we will tax it so the government can continue to expand and pay more benefits to more people in government to continue the expansion. We call government spending “investments”. So the more spending the more investing going forward. It’s a guaranteed financial success.
Can we monetize more debt, too? And rate it AAA and sell it to teacher retirement funds and foreign “investors”? ‘Cause some really smart people on Wall Street and in this Administration think that’s “innovative.”
Why i hadn’t thought of that, but i guess they probably have, and if not you should give them a call an recommend it right away!!
http://www.telegraph.co.uk/finance/comment/edmundconway/7153169/Greece-crisis-There-but-for-the-grace-of-God-goes-Britain.html
Greece and Spain are getting all the attention, but Britain isn’t too far behind.
The news out of Greece seems awful quiet this weekend
The calm before the storm? Here’s what Ambrose Evans-Pritchard had to say on February 5th:
Fears of ‘Lehman-style’ tsunami as crisis hits Spain and Portugal
The Greek debt crisis has spread to Spain and Portugal in a dangerous escalation as global markets test whether Europe is willing to shore up monetary union with muscle rather than mere words.
Julian Callow from Barclays Capital said the EU may to need to invoke emergency treaty powers under Article 122 to halt the contagion, issuing an EU guarantee for Greek debt. “If not contained, this could result in a `Lehman-style’ tsunami spreading across much of the EU.”
Credit default swaps (CDS) measuring bankruptcy risk on Portuguese debt surged 28 basis points on Thursday to a record 222 on reports that Jose Socrates was about to resign as prime minister after failing to secure enough votes in parliament to carry out austerity measures.
Parliament minister Jorge Lacao said the political dispute has raised fears that the country is no longer governable. “What is at stake is the credibility of the Portuguese state,” he said.
Portugal has been in political crisis since the Maoist-Trotskyist Bloco won 10pc of the vote last year. This is rapidly turning into a market crisis as well as investors digest a revised budget deficit of 9.3pc of GDP for 2009, much higher than thought. A €500m debt auction failed on Wednesday. The yield spread on 10-year Portuguese bonds has risen to 155 basis points over German bunds.
Daniel Gross from the Centre for European Policy Studies said Portgual and Greece need to cut consumption by 10pc to clean house, but such draconian measures risk street protests. “This is what is making the markets so nervous,” he said.
In Spain, default insurance surged 16 basis points after Nobel economist Paul Krugman said that “the biggest trouble spot isn’t Greece, it’s Spain”. He blamed EMU’s one-size-fits-all monetary system, which has left the country with no defence against an adverse shock. The Madrid’s IBEX index fell 6pc.
Finance minister Elena Salgado said Professor Krugman did not “understand” the eurozone, but reserved her full wrath for the EU economics commissioner, Joaquin Almunia, who helped trigger the panic flight from Iberian debt by blurting out that Spain and Portugal were in much the same mess as Greece.
Mrs Salgado called the comparison simplistic and imprudent. “In Spain we have time for measures to overcome the crisis,” she said. It is precisely this assumption that is now in doubt. The budget deficit exploded to 11.4pc last year, yet the economy is still contracting.
Jacques Cailloux, Europe economist at RBS, said markets want the EU to spell out exactly how it is going to shore up Club Med states. “They are working on a different time-horizon from the EU. They don’t think words are enough: they want action now. They are basically testing the solidarity of monetary union. That is why contagion risk is growing,” he said.
“In my view they underestimate the political cohesion of the EMU Project. What the Commission did this week in calling for surveillance of Greece has never been done before,” he said.
Mr Callow of Barclays said EU leaders will come to the rescue in the end, but Germany has yet to blink in this game of “brinkmanship”. The core issue is that EMU’s credit bubble has left southern Europe with huge foreign liabilities: Spain at 91pc of GDP (€950bn); Portugal 108pc (€177bn). This compares with 87pc for Greece (€208bn). By this gauge, Iberian imbalances are worse than those of Greece, and the sums are far greater. The danger is that foreign creditors will cut off funding, setting off an internal EMU version of the Asian financial crisis in 1998.
Jean-Claude Trichet, head of the European Central Bank, gave no hint yesterday that Frankfurt will bend to help these countries, either through loans or a more subtle form of bail-out through looser monetary policy or lax rules on collateral. The ultra-hawkish ECB has instead let the M3 money supply contract over recent months.
Mr Trichet said euro members drew down their benefits in advance — “ex ante” — when they joined EMU and enjoyed “very easy financing” for their current account deficits. They cannot expect “ex post” help if they get into trouble later. These are the rules of the club.
The yield spread on 10-year Portuguese bonds has risen to 155 basis points over German bunds.
i don’t get it…that seems like a TINY spread for a debt obligation on the brink of default….weren’t greece’s ten year notes priced around 7 % last week……if they are that risky shouldn’t the yields be a lot higher?
They have to roll a lot of debt and the coffers are empty. Unemployment in Spain is around 25 pct. What segment of the population is it going to tax to pay the debt? Add to that, they can’t print cash like we do.
Seven percent is pretty good in a ZERO return money policy for the major central banks. That’s why we’re all in trouble with pension funds and guaranteed benefits. Where is there any safe return? UST’s? Forgetaboutit. When all you can get most places is nothing, 7% looks astronomical.
Yeah, 7% seems generous until the bank defaults and you’re left holding the bag. Just ask the British “investors” who were getting 6% from Icelandic banks, right up until they stiffed them on their interest AND principle. Color that money gone.
Oh, you mean you wanted a return OF the principal?
You got me there.
Spain has been in trouble for a long time. Nothing new there,
Until it’s population can find a new of thinking, (not likely) they always BE in trouble.
Remember, this is a former empire that pioneered importation as the foundation of an economic model a few centuries ago.
“…will…”
And this is why I’m NOT a famous writer.
Hey eco. You’re good “enough”. How high ya wanna set the bar for blog comments, anyway? Start editing to perfection and you’ll make the rest of us look bad.
In the blogosphere, IMHO, the value lies in immediacy. I’d appreciate your comments anywhere, regardless of edits.
Tanks!
Speaking of sovereign debt issues, how is Iceland looking nowadays?
The Financial Times
Dutch central bank chief says Iceland’s regulators ‘lied’
By Michael Steen in Amsterdam and Andrew Ward in,Stockholm
Published: February 5 2010 02:00 | Last updated: February 5 2010 02:00
Icelandic banking regulators “lied” to Dutch officials about the health of the country’s banks only days before the lenders collapsed in 2008, the head of the Dutch central bank said yesterday.
Seeking to rebut claims that Dutch regulators had been inattentive as the doomed Icesave online bank slipped towards bankruptcy, Nout Wellink, central bank president, said Icelandic regulators had given him what amounted to false assurances.
The remarks threaten to deepen tensions between the countries as Iceland prepares to hold a referendum over controversial legislation to repay €3.9bn ($5.4bn, £3.4bn) in debts to the UK and the Netherlands to cover money lost by British and Dutch depositors.
Icesave, the online arm of the Reykjavik-based Landsbanki, operated in the Netherlands and UK under European rules that meant its home-country regulator was responsible for oversight.
…
This is how wars get started.
Iceland vs. Great Britain and Denmark…….
Talk about a no win situation.
Yep. Britain and Denmark will just park some uninvited warships in the main harbor and that will be the end of it.
But it will still be an act of war no matter what pretty words are used.
Reminds me of the great Cod Wars the Icelanders fought against the nefariously free-fishing Brits back in the day. (Prepare for a thrill. You’ll never see cod the same way…)
http://www.youtube.com/watch?v=_N6URYN_nc4
Thanks. I didn’t know this one.
From today’s New York Times business stories:
“As for housing prices, Mr. Rosenberg (chief economist at Merrill in NY) expects further declines of 10 to 15 percent over the next few years. He pointed to the roughly nine million residential housing units available for sale across the country, a very high vacancy rate when judged against a total housing stock of 130 million units.”
“If his forecast is accurate, the numbers of borrowers who owe more than their homes are worth will rise significantly. Mr. Rosenberg estimates that fully half of the mortgage-holding population in the country could be underwater by 2011.”
And rental prices will continue to decline.
I was reminiscing with a friend the other day. I told him about the days that people would come on to the HBB and tell us all that rents would rise if the housing market crashed.
Who can remember those days? Their logic was that all of the foreclosed homeowners would swell the rental market so badly that rents would rise.
Just think how many things seem so silly now. We all know that rents are not rising due to the crash. They continue to fall because, unlike “owners” of the past several years, renters actually have to have money. Fewer and fewer people have the money for higher rents. Logic escapes the vast majority of the population.
“Who can remember those days? Their logic was that all of the foreclosed homeowners would swell the rental market so badly that rents would rise.”
There was just a press release, er repackaged “news” story in the U-T last week about how now is a good time to be buying apartment buildings.
http://www.signonsandiego.com/news/2010/feb/04/apartment-activity-is-on-upswing/
The “reason” for this supposed recovery is the arrival of an aircraft carrier that will be here temporarily.
“Who can remember those days?”
I can remember providing a basic economic argument that showed them why they were full of crap.
“As for housing prices, Mr. Rosenberg (chief economist at Merrill in NY) expects further declines of 10 to 15 percent over the next few years. He pointed to the roughly nine million residential housing units available for sale across the country, a very high vacancy rate when judged against a total housing stock of 130 million units.”
Why would anyone who believed him buy now, if they thought they could get a home for ten to fifteen percent less over the next few years?
One possible reason: The $8K tax credit. If I were a buyer in a market where I could buy a home for, say, less than $53,333, then I could do just as well buying now as waiting for the fifteen percent price decline (0.15*$53,333 = $8000).
Too bad there are no such markets anywhere people desire to live. And that the $8K tax credit tends to quickly get priced in as yet another layer of subsidy froth in market values.
I’ve been watching a condo in my hometown. It was listed for $100,000 over a year ago. It is just a regular looking apartment built in the late 70s or early 80s. I don’t know what the maintenance costs would be but that condo is now listed at $46,900. I bet you could buy it for cash for $40,000. That would make your mortgage payment about $300 per month, including taxes. Throw that $4,000 of free money in there and who knows?
How would you have a payment in you paid cash for it? Watch out for association fees.
I’m sorry. That was confusing. You or I might be able to pay cash but I was thinking even if you had to finance it you would have a mortgage of about $300. I would guess this place would rent for about $600.
It’s early. Cut the Boy a little slack.
http://news.yahoo.com/s/ap/20100205/ap_on_re_eu/eu_latvia_town_for_sale
Hey Boy, you’re thinking too small. How ’bout you and me getting in on a slice of this action! We could buy a whole apartment building for $40,000. OK, so it’s shoddy Soviet Khrushchev-era construction - buildings built under Stalin were much better built, or so I’m told - but it’s still probably as good or better than anything built during the bubble.
Suzanne researched this.
I don’t know what the maintenance costs would be
The real question is, how broadly will those maintenance costs be shared? How many FBs and deadbeats have already stopped paying their association dues or gone the “strategic default” route? A $40K condo is no deal if your share of building maintenance comes to $1,000 a month or more, or if the building fills up with riff-raff renters (not our sort of higher beings).
A friend of mine’s apt building went condo in 2005. She still lives there and rents the same apt now owned by a so-called investor. By 2006, only about four of the 16 units had been sold and the new condo owners had to sue the deadbeat developers to get them to pay their share of the fees. By 2009, the condo fees, which started out low, were the same price as rent had been in 2005. To own a condo, with basically no improvements except painting, in a 100-year-old apt building, costs 5x what it cost to rent it as an apartment in 2005 (assuming a standard mortgage).
Also, parking spots where the tenants formerly parked for free, now had to be purchased for $25,000.
Condos: the worst of both worlds.
“I’ve been watching a condo in my hometown”
b..b..However will they get NYCityBoy back after seeing all the wonderous lights, action and sights of gay New York City ?
Mikey, I will let you enjoy those winters of our homelands. Last night it was windy and cold here but nowhere near what you and I have been subjected to in our lifetime. I hope not to go through that process again.
Have a nice Sunday. I’m staying put.
(just sadly sips coffee with Bailey’s Creme and daydreams those far away idyllic warm places, cute girls in bikinis and hot sand)
Just noticed last night that one of our Dark Towers is now leasing..it was a pretty nice serviceable apartment building before the conversion.
Now it has pergogranisteel!
Minnesota has a high percentage of Scandinavians. Those girls look hotter in a ski outfit than most girls in a bikini.
Sammy.
Tan lines…It’s always about tan lines
They look better golden brown …with those tan lines !
Prof,
Isn’t the tax credit 1% up to the $8,000 limit?
10%
Right. Lost my zero! My meaning was that the credit on a $53,000 house would not be $8,000.
Right! Forget what I said — there is currently no good reason to buy a home in any market, regardless of the availability of the tax credit…
there is currently no good reason to buy a home in any market
I have no regrets about locking up 40k in a doublewide to save 1k/mo…it’s a rate of return that works for me. 4k from Obama for buying it is just icing on the cake :-).
But yes, a “real” house someday would be nice…AFTER the insanity ends.
“Mr. Rosenberg estimates that fully half of the mortgage-holding population in the country could be underwater by 2011.”
Plus a trillion-or-so dollars worth of ARMs are scheduled to reset.
And the last line in the article:
Mr. Rosenberg said. “Unfortunately, I think we are still in the early stages. The next recession will happen more quickly than people think.”
“The next recession will happen more quickly than people think.”
Dismal science just ain’t what it used to be, thanks to irrationally exuberant economists like Mr. Rosenberg. From where I stand, the current recession is still playing out.
Also said by the same.
“Mr. Rosenberg reckons that the flight to the dollar will continue. Even though the United States has plenty of its own economic challenges — enormous public debt weighing on a struggling economy, for example — our lot is far better than others’, he maintains. ‘In the land of the blind, the one-eyed man is king,’ he said. ‘The U.S. dollar is that one-eyed man.’”
One eyed, one legged, and taking Viagra.
Somebody say it for me. You know the words.
Let me try. I believe the first word rhymes with “crash”. Is it dash? No. How about hash? Hmmm. Smash? Oh, this is tough. Wait. I’ve got it. Cash!
Cash
The next is a little word. What is a little word? I got it. Is.
Cash is
The next is some kind of meaningless dignitary. Is it President? No. Speaker of the house? Nahhh, although that one is really meaningless right now. How about duke? Oh, that can’t be it. Eurethra, I have it. It is King.
Cash is King!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Thank you.
Cash and cans of corned beef hash !!!
Cash is king, and will remain so until it is untimely ripped from its throne.
The trick is predicting the time until usurpation…
“The trick is predicting the time until usurpation…”
I don’t think predicting the time will be necessary if you pay attention to events.
When it is the time finally arrives you will know it.
Make that: “When the time arrives you will know it”.
“When the time finally arrives you will know it.”
Since this is obvious, could you kindly itemize your list of signs by which we shall know it? (Please humor me — I am in the blackest of moods today…)
“The trick is predicting the time until usurpation”
I’ll take a guess. When the next Long Inflation matures. The one bigger than the biggest long inflation in history that we just had, like the whole time I’ve been alive. When the next “biggest expansion of credit in history” occurs. When the next global housing mania fires up, like in about 80 years.
Boo hoo, Prof Bear. You think you have it bad? You should count yourself lucky. Just think of my poor little wife. She woke up this morning and realized she was still married to ME. Now don’t all of your problems seem a little less problematic?
When the next Long Inflation maturesThe one bigger than the biggest long inflation in history that we just had, like the whole time I’ve been alive.
The dear departed AladinSane would’ve encouraged us not to take such a US-centric view of Big Inflation and the heights it can reach. Think big!
“She woke up this morning and realized she was still married to ME.”
My wife had similar issues when I woke her up this morning…
Read “The Intelligent Investor”, by Benjamin Graham. It’s all in there.
But briefly: Wait until stocks become outrageously cheap. Meaning: Going concerns with low P/Es, selling much less than book value, maybe even less than net current assets, lots of cash, positive cash flow, etc.
Probably daily volume will be low because of lack of buying interest. (Note: Dull markets make good markets for buyers; Exciting markets make good markets for sellers.)
In the coming years, as ready cash gets harder and harder to come by, stockholders will gradually shed their holdings (so will holders of gold, IMO.) This will be a great time for those investors armed with lots of cash.
Yesterday at the mall I saw a dude wearing a black T-shirt that said: AMMUNITION - THE CURRENCY OF THE NEW MILLENIUM.
My six-year-old daughter held my hand a bit tighter as he walked past. But he might be on to something.
As a personal observation, value investing - the Ben Graham type of investing - works best in hard times, it works best in economic contractions.
During exciting times, when the economy is expanding, value takes a secondary position to growth because growth represents promise.
Exciting times are full of promises - most of which end up unfulfilled. That’s why stocks end selling at P/Es of a hundred or more.
Contractions offer little in the way of promises. People in contractions are no longer looking to get rich; they’re just looking for ways to hang on to what they have, to survive.
“But briefly: Wait until stocks become outrageously cheap. Meaning: Going concerns with low P/Es, selling much less than book value, maybe even less than net current assets, lots of cash, positive cash flow, etc.”
Did he write that before or after Reagan created the PPT?
kind of sounds like the advice a young person gerts in regards to losing their virginity
We saw “The Last Station” last night. There is a fun subplot involving devirgination…
Is that the same Merrill Lynch that was telling its clients that $200/bbl oil was just around the corner?
Yes, but don’t suppose that all branches of Merrill listen to Mr. Rosenberg. He was QUITE EARLY in calling the housing bust, and that didn’t prevent Merrill from getting its own a$$ busted by putting its money where Rosenberg’s mouth was NOT.
Yeah…Remember the “Peak Oil” mantra…More like “Peak-Your-Pocket”….
Rosenberg certainly has more credibility than Greenspasm, who appeared on Meet the Press this morning. Greenspan argued that housing prices cannot decline much more. Why not? His basic argument was that if they do decline much more, there will be another massive wave of foreclosures and walk-aways. Therefore, they can’t decline much more.
Thanks Alan for that brilliant analysis!
I missed it!
Thanks for the Recap!!
I saw it also…I took it as a grave warning…It would usher in not a double-dip but a
double-dive…
HA! Like saying the Titanic was unsinkable not because of its construction, but because otherwise the passengers would get wet.
estimates that fully half of the mortgage-holding population in the country could be underwater by 2011 ??
Game Over…..
1 down (FLA), 49 to go
Oldie but goodie:
A Three-Part Series on the U.S. Housing Bust
DAY ONE
* Boom
Forces converge to fuel the biggest American housing boom since the 1950s: plunging interest rates, exotic new Wall Street securities that flood the mortgage industry with cash, and easier loan packages for immigrants and others with less-than-stellar credit.
DAY TWO
* Bust
Banks and other mortgage lenders notice weakness in the housing market. New houses sit unsold and foreclosures rise as people who bought homes with adjustable-rate mortgages see sharp spikes in their monthly payments. Central bankers and other watchdogs are caught by surprise.
DAY THREE
* Aftermath
When subprime lenders implode, the contagion spreads quickly to Wall Street, which had packaged risky mortgage loans and sold the securities around the world. Investors panic that the housing collapse will reverberate through the rest of the economy.
Eeyore’s Lament: “Woe is me,…Woe is me” …oh, bother
Are you trying to offer some kind of subtle hint that there has never been a better time to buy a home?
HARDY de HAR HAR Mr. Bear…oh, and take Limpy the Lion & Magilla Gorilla outside for a walk while you’re at it
For those who “lost” the opportunity to watch ‘back-in-day”:
Their cartoons revolved around ever-hopeful Lippy’s attempts to get rich quick, with reluctant Hardy serving as a foil. Whatever the consequences were to Lippy’s schemes, Hardy would end up getting the worst of it — a fact he always seemed to realize ahead of time, with his moans of, “Oh me, oh my, oh dear.”
Mr. Bear = Hardy de Har Har …the Hyena
1971 episode:
“…Lippy the Lion and Hardy Har Har were seen in Yogi’s Ark Lark. In one scene, Lippy was fed up with Hardy’s behavior when those that were on the Noah’s Ark were getting bored looking for the perfect place. Though, he did save Hardy when the Ark ended up in a storm.”
DAY THREE
The President, surrounded by his top economic advisors, gives a rousing telepromptor speech that “we are printing five trillion for a new stimulous package. The crisis has been contained.” Immediately, markets rebound, full employment returns, hope and change fill the land. Our overseas adversaries lay down their weapons and join in a rousing chorus of Kum Bye Yah, followed by “Age of Aquarious” before going off to practice various peaceful New Age religions. The grateful electorate, bouyed by the 99% Democratic vote of our 51st state, Haiti, hands Obama a landslide re-election victory over the Palin-Brown ticket.
Forgive my misty eyes.
“…Palin-Brown ticket.”
Correction:
Palin/Jeb ticket
Rene Zellweger: “You had me at…”This sucker could go down!”
if palin is on the other ticket , obama is lock to win no matter how bad the recession is get real….better yet get a real candidate
It depends entirely on how she is packaged and what she says. Mark my word — if Obama hangs on to Friends of Wall Street like Bernanke, Summers and Geithner while Palin comes in as the outsider who is determined to clean up the banking system, she will do ‘better than you expected’…
Not to mention how well she can keep notes written on her hand.
eco - knock it off. Elmer Fudd and his cartoon character friends would be better for us than the entrenched liberal intelligentsia and corporatocracy. The best thing that could happen would be to get a bunch of farmers with good sense into positions of power, where they can slow down the carnage.
Palin may not fit your stereotype of the buttoned up East Coast Intelligentsia, or your Texas Oil Baron. This seems to be the major problem.
What alternative stereotype might you like to offer up to guide us on the next leg down?
“The best thing that could happen would be to get a bunch of farmers with good sense into positions of power, where they can slow down the carnage. “
The problem is they would then have the good sense not to want the job.
I’m thinking if Sarah gets out in front of the wave of anti-bank populism and proves herself to be a proficient tsunami surfer, I may have to soften my stance and support her candidacy with my populist vote. Politics breeds strange bed mates.
Updated February 07, 2010
Palin ‘Would Be Willing’ to Take On Obama in 2012
By Judson Berger
- FOXNews dot com
Sarah Palin has President Obama in her sights, telling FoxNews dot com she “would be willing” to challenge him in the 2012 presidential race.
…
“…Politics breeds strange bed mates”
Palin / Jeb 2012!
Alaska / Florida
Bookends for “TrueAnger™” representative Gov’t!
If Palin & Obama are the two major party candidates, I predict a third-party candidate will gain traction. In fact, the Repubs might BE that third party (because I don’t actually think they’ll nominate Palin; she’d have to be the TeaP candidate).
Palin concentrated more on national defense in her speech than the economy. It’s easier to understand. She should read this blog for a few months to learn about the economy before she runs in two years.
Millions of people didn’t vote against McCain.
They DID vote against winking and blinking Caribou Barbie.
+1 Mikey…Right on the money…
If she had only done a “home-made porn” video that “accidentally” made it onto the internet (see Paris Hilton), she’d be VP right now. Especially if she could blame it on the “liberals” somehow.
My write-in vote for Ron Paul was very definitely a vote AGAINST “McSame” and any running mate he would have chosen, and a repudiation of the corrupt and clueless GOP establishment.
Palin ?? I hope the neos run her….
I never saw this before…Thanks Pbear…
It appears the “dangerous policy vacuum” is a financial black hole which is sucking America’s collective wealth into a ginormous REIC snake pit.
Mortgage giants GSEs in limbo: In housing, a dangerous policy vacuum grows.
Sunday, February 7, 2010
THERE IS NO END in sight to the federal bailout of Fannie Mae and Freddie Mac. President Obama’s fiscal 2011 budget proposal said as much in a few phrases that promised nothing more definitive than continued “monitoring” of the two mortgage giants, which have been operating since mid-2008 in the legal and organizational limbo known as government “conservatorship.” The administration had said its plans for definitive reform could be expected “at the time of the budget,” not in the budget itself, so technically this doesn’t count as a broken promise or a blown deadline. Still, as the two agencies’ chief regulator, Edward J. DeMarco, gently reminded congressional leaders on Tuesday, conservatorship was intended as a “timeout” during which policymakers could reinvent the entities. With an election year upon us, that timeout is looking more and more like a cop-out.
This is alarming. The Fannie-Freddie business model — “government-sponsored enterprises” (GSEs) with private shareholders but a public purpose, promoting homeownership — is a proven loser. In fact, Fannie and Freddie were in large part responsible for inflating the housing bubble that burst so disastrously in 2007. The market’s perception (correct, as it turned out) that the GSEs enjoyed federal backing enabled them to take on far more risk than their capital bases could support.
Continuing to pump taxpayer money into Fannie and Freddie so that they can continue to securitize home mortgages — the Treasury Department has covered $111 billion worth of their losses so far — is justifiable as an emergency measure. Without it, the U.S. housing market would have collapsed: Fannie and Freddie now back the vast majority of new mortgages, and the homeownership rate has nonetheless fallen almost two percentage points from its 2004 peak of 69 percent.
But the United States cannot afford the indefinite de facto nationalization of housing finance. The administration estimates that the GSEs’ losses will cost the government more than $54 billion in fiscal 2011, plus another $23 billion in fiscal 2012, assuming the White House’s economists have guessed right about the foreclosure rate and other variables. The entities’ debt totals more than $1.6 trillion, on top of the existing national debt of $12.3 trillion.
…
We don’t need no stinkin’ policy. We’ve got hope and change!
only change we got is jingling in my pocket….
(actually, if Obama doesn’t start a new war over the next 7 years the change will be significant)
I’m pretty confident King BB and his Lords on Wall Street will come up with an innovative solution. Cash is king, after all.
OK you got me, who’s “King BB” ??
ben bernanke, silly
I thought it was BB King?
Well certainly the GSE model is flawed. But IMHO the deeper problem here is that the securitization model, whether done by GSEs or WAll Street CAN’T keep house prices from falling to a sustainable level. Which is realy a feature, not a bug. But of course the powers that be are desprately committed to preventing further declines in RE prices.
“Treasury Department has covered $111 billion worth of their losses so far — is justifiable as an emergency measure. Without it, the U.S. housing market would have collapsed”
What bull. I wish just once someone would ask these reporters what they mean by the housing market collapsing. Without support, the housing market would do what other industries do when they have too much overpriced junk—they have a sale. And they price the junk until it moves. Has anyone ever heard of a market collapsing when things got cheaper? One would think we didn’t have a housing market prior to securitization.
Rising FHA default rate foreshadows a crush of foreclosures
By Dina ElBoghdady and Dan Keating
Washington Post Staff Writer
Tuesday, February 2, 2010
The share of borrowers who are falling seriously behind on loans backed by the Federal Housing Administration jumped by more than a third in the past year, foreshadowing a crush of foreclosures that could further buffet an agency vital to the housing market’s recovery.
About 9.1 percent of FHA borrowers had missed at least three payments as of December, up from 6.5 percent a year ago, the agency’s figures show.
Although the FHA’s default rate has been climbing for months and eating into the agency’s cash, the latest figures show that the FHA’s woes are getting worse even as the housing market shows signs of improvement. The problems are rooted in FHA mortgages made in 2007 and 2008. Those loans are now maturing into their worst years because failures most often occur two to three years after a mortgage is made.
If the trend continues and the FHA’s cash reserves are exhausted, the federal government would automatically use taxpayer money to cover the losses — a first for the agency, which has always used the fees it charges borrowers to pay for its losses.
Beleaguered books
For now, just about every major measure of the agency’s financial health is worsening.
The FHA does not make loans but insures lenders against losses. And claims have already spiked. The agency had to pay out on 47 percent more loans in October and November than in the corresponding period a year earlier, according to an FHA report.
The number of loans in foreclosure, including those that have not yet been billed to the agency, has also increased. They were up 26 percent in the last quarter from a year earlier.
FHA Commissioner David H. Stevens, who joined the agency in July, flagged his agency’s troubles with the 2007 and 2008 loans in October, when he told a House panel that “rogue players on the margin” immediately migrated to the world of FHA lending after the subprime mortgage market collapsed.
Their aggressive lending tactics attracted borrowers with unusually poor credit profiles to the FHA. “That clearly impacted the books of business in 2007 and 2008, and that performance data is showing up very clearly in today’s balance sheet,” Stevens said at the time.
Plunging home prices have exacerbated matters by leaving some FHA borrowers unable to sell or refinance their homes because they owe more than their homes are worth. Yet with unemployment running high, many borrowers can’t afford to keep up their payments.
Adding to the trouble was a now-defunct FHA program that enabled sellers to cover the down payments of buyers. This meant many borrowers had no skin in the game and were more likely to walk away at early signs of trouble. The program resulted in excessive defaults before it was ended in late 2008, and it is projected to cost FHA an additional $10.5 billion in losses, Stevens said.
For all these reasons, the FHA projects that it will pay out claims to lenders on one out of every four loans made in 2007 — the worst rate in at least three decades. The claim rate should be nearly the same on the vastly larger volume of loans made in 2008.
“If the trend continues and the FHA’s cash reserves are exhausted, the federal government would automatically use taxpayer money to cover the losses — a first for the agency, which has always used the fees it charges borrowers to pay for its losses.”
Would it be possible to create a tax credit for U.S. renters to ensure that not one penny of their tax payment goes to making up losses on the FHA subprime loan insurance program? Otherwise, Uncle Sam will be forcing those who are too poor to afford a home purchase to subsidize the gambling losses of relatively wealthier folks who used federally guaranteed mortgages to purchase houses they could not afford.
Why in any case should nonparticipants in the owner occupied housing market be coerced into subsidizing the home purchases of those who choose to participate? And since when does Uncle Sam favor reverse-Robin Hood wealth redistribution schemes? I would love to see Professor Bernanke offer one solid reason based on standard economic theory for why this is a good idea; I bet he has none to offer.
Here’s an unwinding scheme for you to ponder Prof.
Have the gov show up at every foreclosure auction and purchase the property for the full amount of the loan using money whistled up out of nowhere.
Auction the property back to the public where the price is fixed to what the gov paid and what the bidders bid on is what interest rate on a 30-yr fixed they are willing to pay.
This will reliquify the financial system in the short term as all the current loans get paid off in full. It will support home prices in the short term allowing them to fall gradually over the next 30 year until an equilibrium is reached. All of the money created out of nowhere will eventually be paid back and can be destroyed at that point. The taxpayer will actually make a profit on the deal.
Of course this will never happen as it will destroy the private mortgage market for a couple of decades and wall street will lose a revenue stream to feed on.
Is this supposed to be a description of what is actually occurring, or merely some nightmare scenario cooked up by your very active imagination?
Hee, hee.
Dreaming up nightmare scenarios has been a hobby of mine since I became aware of what was coming back in 2004.
It’s an interesting intellectual puzzle. How to insure that all the guilty parties are (mildly) punished, while unwinding the imbalances, but not punishing people so much that the real economy gets crushed.
I actually think this would work. If it injected too much liquidity one could always package the new mortgages up as securities and sell them.
“This will reliquify the financial system in the short term as all the current loans get paid off in full.”
This approach would potentially create a significant amount of supply thus further depressing the prices of houses. This coupled with the number of houses already under water could spell disaster. Suspect the government wouldn’t be able to sell the properties back to the public for the original loan amount.
“This approach would potentially create a significant amount of supply thus further depressing the prices of houses.”
I think that may be what diemos meant when he suggested, ‘I actually think this would work.’
It will support home prices in the short term allowing them to fall gradually over the next 30 year until an equilibrium is reached.
That’s the part that leads me to seriously doubt I will ever again own a home. Anyone who is interested in doing so better try not to catch himself a falling knife.
I bid -5%
There is no problem a little cash infusion won’t solve. It’s for the greater good.
I don’t agree with your prescription for renters’ relief, PB. We were gamblers too, but we bet on the right side. We bet on the Sure Thing, you might say. We are the New Rich. You are probably the New Richest, since you even have a job.
I do object to using taxpayer money to make up losses on subsidized mortgages, but I don’t want long-time homeowners’ tax money ued for that purpose either.
Oh well, just bantering. The AHs in DC will probably just go on doing what they’ve been doing.
I find it abhorrent that renters are forced to subsidize home buyers’ gambling activities, especially given that the average home buyer household is far wealthier than the average renter household. Further, beating renters with big financial carrots and sticks into becoming home buyers is counterproductive for the U.S. economy — just look at all those who are sitting right now in homes they would like to sell but can’t, because they are so deeply underwater.
To each his own.
Well I certainly agree with your contempt for the incentives they provide for renters to become buyers. But we can still gamble on the Sure Thing, which is that buying will be the worse deal in the short term and the intermediate term.
Climate scepticism ‘on the rise’, BBC poll shows
“The percentage of respondents who said climate change was a reality had fallen from 83% in November to 75% this month.
And only 26% of those asked believed climate change was happening and “now established as largely man-made”.
http://news.bbc.co.uk/2/hi/science/nature/8500443.stm
While watching Fox News last night they had a story that talked about the snowstorm that hit Wash DC yesterday, saying was the 3rd or 4th largest snowfall ever, stating 17″ had fallen. This was done by a news babe that commented that it seemed closer to 24″ as she stood in the snow. THEN, later in the news story (2 min later) they showed a graph and the Dulles Aireport was showing a 32″ snowfall!!!
Did Al Gore see his shadow this week?
“Did Al Gore see his shadow this week?”
Not if he was standing behind Tipper.
Did Al Gore see his shadow this week?
Did any houses sell this week?
The housing bubble must be over!
Then there is this often quoted climate skeptic Dr. Roy Spencer trying to ‘hide the increase’…
www drroyspencer com/2010/02/nasa-aqua-sea-surface-temperatures-support-a-very-warm-january-2010/
My observation is that the actual climate records are all accelerating to extremes that exceed most of our human historical records. There are indications that the biosphere is changing too, especially the oceans.
All that being said, if the human species is found to be the root cause of a major bio-system collapse they lack the self-preservation motivation to stop the growth-at-any-cost mentality that will prevent us from going past the red-line. The easy answer is “Not my problem cause I’ll be dead and gone”. It seems wrong but it’s pretty logical on the surface. No one reading this blog will live long enough to see the long term effects we made to the environment 30 years ago much less the the future effect of consuming tens of millions of barrels of petroleum products at an ever increasing rates.
In a perverse way the world needs an energy crises so we can employ (jobs!) billions of people to avert the disaster. Sort of a “War to Save the World”… If the major religions get behind it I could see it happening, otherwise we will have a war.
spot on bluestar!
My observation is that the actual climate records are all accelerating
to extremes that exceed most of our human historical records.
So climate records are different from 51% of records that cover 100 years out of a 5 billion year history? OMG, run for the hills.
There are indications that the biosphere is changing too, especially the oceans.
And we certainly wouldn’t want that biosphere to ever change. Let’s all bow down to Al Gore and send him all our money before it’s too late!
LehighValleyGuy, did you miss this observation:
“No one reading this blog will live long enough to see the long term effects we made to the environment 30 years ago much less the the future ie. “Not my problem cause I’ll be dead and gone””. Your comment fits my theory perfectly. Even if there is man made changes to the climate we won’t change our behavior. I’m not condemning you, I’m saying it doesn’t matter, it’s human behavior. Adapt or perish, your choice.
Please take a look at the historical sea level chart in the Wiki article linked below.
en dot wikipedia dot org/wiki/Sea_level
I’m talking about the one showing the level from about 20,000 years ago to the present. It’s titled “Post-Glacial Sea Level Rise” and it’s about 3/4 of the way down the article. From 14,000 years ago to about 7,000 years ago the sea level rose about 80 meters (250 feet). From 7,000 years ago to the present, the rise has been about 5 meters (16 feet). How long ago did the human species start to form civilizations?
Here’s a chart showing historical temperatures back to the Precambrian era.
www dot scotese dot com/climate.htm
The planet has been warmer for more of that interval than it is now. We’re currently in a cool interval that is probably about to go back to a warm interval. Is this transition human caused? Then what caused all the prior transitions from cool to warm that took place long before the ascendancy of our species? Why is it different this time?
Bill in C,
This is the key point. If the world’s climate has always been changing, what made it change in the past and what makes us think that we can correct it from warming (or cooling) in the future.
Lip
Point taken, don’t look back to prove climate change because we just can’t explain the natural variability. But don’t be blinded to the actual real-time data of population growth. If we can prevent the rest of the world from raising their standard of living to ours (we use about 20 bl. oil per person/year) then it’s onward and upward, otherwise something is going to change.
The doubling of current World Population Growth rate is estimated at 61 years, while in the 1960s, the doubling of World Population was only 35 years. Presently, many Asian and African countries double their population in about 15 years. World population in 2009 was estimated at 6.8 billion people, and in the year 2050, the World Population is estimated at approximately 9.4 billion people. You do the math.
My sister says Randallstown, MD had 32 inches of snow too. She will have to drive there to work tomorrow from Fells Pt.
I had an interesting conversation with an LDS attorney who does some kind of work in the local (SD) CRE market. We got onto the topic of housing, which led him to suggest that, “I don’t think prices will go much lower from here.”
Naturally inquisitive as I am, I asked, “Why?”
His response: Blank stare.
I checked my gut level urge to quietly go for the jugular, but the thought occurred to me that faith is a far more useful tool in the context of religion than in that of financial economics.
” … faith is a far more useful tool in the context of religion than in that of financial economics.”
Aren’t we fortunate that this is so true. True believers will keep up their donations, whether to their church or to the banks.
I don’t know about churches (nor do I much care) but the banks surely need these donations (of this I do care).
Better their money than mine.
Banks and churches — what is the difference? Both of them use faith-based tricks to separate fools from their money…
Banks and churches — what is the difference? Both of them use faith-based tricks to separate fools from their money…
Banks, churches, therapists, self-help gurus, personal trainers, plastic surgeons — the list goes on for a depressingly long while. There’s dogma in every corner.
… economists …
Poster child for faith-based economics:
- Untested belief that hair-of-the-dog stimulus measures can be used to reflate a collapsed credit bubble.
Bad, Professor Bear! (scolding and wagging finger) Bad, Professor Bear! Impolitic, Professor Bear!
Roidy
I at least bit my tongue when I felt a strong urge to suggest San Diego home prices had maybe another twenty percent to fall before bottoming out…
“I at least bit my tongue when I felt a strong urge to suggest San Diego home prices had maybe another twenty percent to fall before bottoming out…”
Really, that little?
I’m trying my hardest to be an optimist, Greg!
Dropping enough to be in line with incomes and other market forces would be a good thing. Finally collapsing because the broader economy had collapsed wouldn’t be such a good thing. Housing would likely be the least of our issues then.
“…that faith is a far more useful tool in the context of religion than in that of financial economics.”
There’s a “sub-division” within the Catholic Church that “currently” might have a different POV…
right PB,
there isn’t hope in housing prices it’s really FAITH.
I remember the first californians i met back in the 80’s, they would repeat it like catachism about realestate only goes up, i felt like i was surrounded by some sort of cult
“…they would repeat it like catachism about realestate only goes up, i felt like i was surrounded by some sort of cult”
Here’s the CULTS ….sweet sweet sweet “nectar”:
“In a single transaction, about $110,000 / $220,000 / $330,000 / $440,00 …went into their personal bank accounts as the ESCROW closed on their houses”
Of course, the numbers would have to be revised for the 80’s times:
“In a single transaction, about $40,000 / $60,000 / $130,000 / $170,00 …went into their personal bank accounts as the ESCROW closed on their houses”
Anyone who dares to question that faith does so at the risk of facing a lynch mob.
I had a wayout Southern Baptist minister tell me that God was going to get me when I was 12 yrs old.
I told him, “Good, anything to get me out of your church services.”
Unfortunately, my parents got wind of that comment and I was grounded for darned near eternity.
Funny…Good one Mikey
That was nothing. The Baptists were always after me.
I was in US Army jump School. It was windy and rainy and we were in a hanger waiting for the weather to clear for our 1st Airborne jump. In wanders this Gung-Ho US Army Airborne Lt. Col. Chaplin in dress uniform. What a sight!
He had more combat medals, decorations, ropes and ribbons on his chest and shoulders than Gen. George Paton. He looked like a freakin’ monsterous Christmas tree with a cross on top. He had coffee sent in and he’s preaching, ranting about war, living and dying.
I believe he thought that he was raising the nervous young wannabe paratroopers moral. Rain, wind and lightening rages outside. This was an bad, bad Omen. Either God, this Lt. Col. or lightening is really, finally gonna get me today. This lunatic is on a roll an he owns the hot coffee, so I’m a Baptist for 20 minutes.
Of course, he zeros in on me with coffee and a pesonal Fire and Brimstone sermon. Yeah…you aren’t jumping with us today colonel. I just listened politely, smiled innocently and nodded with an occassion alert “Yes Sir” and “Yes Colonel”. and “I’m a Believer Sir”. I am DEFINITELY not about to mess with this man and this old “Airborne God” just won’t leave me alone. Jumping doesn’t scare me…he does.
Finally, some Black Hat Jumpmaster screams, “We have clearing skies over the Drop Zone..It’s a Go..Load up Troopers”.
mikey says “Goodbye” and our gang waddles out into the rain and head for the aircraft wiggling in the wind on the runway. All the young troopers think they’re gonna die on their 1st jump.
I was damned near positive that I was gonna die! I had to march out in rain, thunder and lightening, get on a rickity old plane and fly out of Georgia and jump out of a plane just to away from that Southern Baptist sermon.
J/k The colonel was one cool far out old dude…it’s just that I’m not really a Baptist
Well, at the time you were just a f_cking leg.
Stand at attention, pay attention, don’t f_ck with your equipment and shut the f_ck up when an airborne COL talks to you. You may learn something.
Former Jumpmater 2banana
Be thankful it wasn’t the Catholics that were after you!
Well, at the time you were just a f_cking leg.
[roll eyes] I just thank God every day to be a POS civilian that can blissfully forget I ever heard such crap spouted from the mouths of a million R. Lee Ermey wannabes…
Definition of a Jumpmaster :
— some cherry Sgt.– usually in the way, with NO other earthly function other than blocking my tailgate on green light, as I lead my stick into the night coming in from the China Sea on the 7 second DZ.
“Airborne” !
Kubasaki Animal, Jungle Rat, Abn (Separate)
The ultimate short sale….From the Wall Street Journal:
On Friday, CoStar Group Inc., a provider of commercial real estate data, announced that it had agreed to buy the MBA’s 10-story headquarters building in Washington, D.C., for $41.3 million. The price is far below the $79 million the trade group says it paid for the glass-walled building in 2007, while it was still under construction. The price also is far below the $75 million financing that the MBA received from a group of banks led by PNC Financial Services Group Inc. to finance the purchase.
John Courson, chief executive officer of the trade group, declined in an interview Saturday to say whether the MBA would pay off the full loan amount. “We’re not going to discuss the financing,” he said. A spokeswoman for the MBA added that the MBA has reached “an agreement with all relevant parties” regarding the outstanding amount on that loan but declined to provide any details.
Couldn’t happen to a better organization!
“We’re not going to discuss the financing,”
I suggest they use a pick-a-pay, no-downpayment, no-doc liar loan.
That’s my nimrod classmate’s outfit!!!
No kidding? Now that’s just too damn funny!
Here is a tiny little hint to Mr Lockhart about how to reprivatize the GSEs:
Eliminate the price support measures that are currently propping up U.S. housing values on a temporarily high plateau, allowing local housing prices in various corners of the U.S. to reach a fundamentals-based equilibrium, or the closest possible facsimile thereof, given the myriad layers of subsidy froth already priced into U.S. housing prices. Once the collateral is properly valued, a stream of private capital will miraculously flow forth from under the proverbial mattresses where it currently hides.
Bloomberg
No Turning Back on Fannie, Freddie, Lockhart Says (Update1)
February 06, 2010, 10:32 AM EST
More From Businessweek
(Adds Lockhart comments starting in second paragraph.)
By Theo Francis
Feb. 5 (Bloomberg) — The U.S. investment in Fannie Mae and Freddie Mac may be too deep to effectively transition the mortgage-finance companies out of government control and back into the hands of private investors, their former regulator said.
“I would love to figure out how to get there, but I think we may be too far along the line of government involvement,” James B. Lockhart III, who ran the Federal Housing Finance Agency and its predecessor agency from 2006 until August 2009, said in a Bloomberg Television interview today.
Lockhart, 63, said he wasn’t excited about putting the companies into conservatorship in 2008 and pushed back against suggestions to take the more drastic step of receivership. Fannie Mae and Freddie Mac, the largest sources of money for U.S. home loans, were seized by FHFA 17 months ago because of their risk of failing and have since survived on $110.6 billion in taxpayer- funded aid.
“Most of that money will never be seen again,” said Lockhart, who is now a vice chairman for Invesco Ltd.’s WL Ross & Co. “They were just allowed to leverage themselves so dramatically.”
The world would have “effectively fallen apart” if FHFA didn’t take the action it did as mortgage defaults rose, he said. Lockhart said he was “a little bit” disappointed in parts of Treasury Secretary Henry Paulson’s memoir that characterized FHFA as weak during deliberations over Fannie Mae and Freddie Mac.
“Obviously, when you do something this big, you want to do it right,” Lockhart said. “Both firms could have sued us, taken us to court, and reversed it. We wanted to have it so they voluntarily consented to the conservatorships.”
Bernanke’s ‘Steady Influence’
…
I think they WILL allow housing prices in the US to reach a fundamentals-based equilibrium, as best they can. But they’re going to make sure that it happens very, very slowly. Make the waves of bank failures look slow. Above all, keep most of the underwater folks in the “performing” category, i.e., don’t tempt them to default. They will keep performing if they think they are only a LITTLE bit underwater, and if they don’t panic. “Panic” implies a certain speed which PTB will do everything to avert.
You’re probably right. What can seem like efforts to support prices, or even reflate them, are really frantic reactions to hold it all together.
Picturing a Warner Bros. character yanking the emergency brake lever off the floor of a cartoon car - wires, cables, and all.
“But they’re going to make sure that it happens very, very slowly.”
And if they succeed, U.S. housing may prove to be a very sucky investment for the next several decades.
But they’re going to make sure that it happens very, very slowly.
An overdamped system doesn’t overshoot, which I assume is their worst nightmare. And is, of course, what most of us vultures are waiting for.
Real Estate Notes
30-year mortgage rates top 5 percent
Saturday, February 6, 2010
Rates on 30-year fixed mortgages rose slightly this week, inching above 5 percent, Freddie Mac said Thursday.
The average rate on a 30-year, fixed-rate mortgage was 5.01 percent, up from 4.98 percent last week, Freddie Mac said in its weekly mortgage rates survey. Last year at this time, the average rate was 5.25 percent.
The average rate on 15-year, fixed-rate mortgages rose slightly, to 4.40 percent from 4.39 percent, according to Freddie Mac.
Rates on five-year, adjustable-rate mortgages averaged 4.27 percent, up from 4.25 percent last week. Rates on one-year, adjustable-rate mortgages dropped to 4.22 percent from 4.29 percent.
Borrowers can lower their interest rate by buying points, equal to 1 percent of the loan amount. The nationwide average in Freddie Mac’s survey was 0.7 points for 30-year and 15-year loans.
…
It is completely predictable that this sort of occurrence will play out once or twice a decade somewhere around the LA mountain foothills, but nonetheless always shocking when it does. I suppose the people whose homes are washing away owe a word of thanks to the developers who thought the outflow basin at the bottom of a canyon would be a lovely place to build a tract home development? (Sure wish Oly were around to offer a follow on remark about sleazy real estate developers…)
Mudslides sweep away cars, assault homes near LA
By THOMAS WATKINS, Associated Press Writer
Saturday, February 6, 2010 at 12:20 p.m.
LA CANADA FLINTRIDGE, Calif. — Thunderous mudslides damaged dozens of homes, swept away cars and pushed furniture into the streets of the foothills north of Los Angeles on Saturday as intense winter rain poured down mountains denuded by a summer wildfire.
No injuries were reported but residents and emergency responders were caught off guard by the unpredicted ferocity of the storm, which damaged more than 40 homes and dozens of vehicles.
About 800 homes across Los Angeles County were evacuated for much of the day after heavy rains at the foot of the San Gabriel Mountains overflowed debris basins, carried away cement barricades and filled houses with mud and rocks.
…
A Los Angeles County Fire Department Urban Search and Rescue (USAR) member, carries a 91-year-old woman from her flood-damaged home on Ocean View Boulevard Saturday, Feb. 6, 2010 in La Canada Flintridge, Calif. (AP Photo/Mike Meadows)
…
Cars are stuck in mud on Ocean View Boulevard after an intense winter storm brought down hillsides in wildfire burn areas north of Los Angeles in La Canada Flintridge, Calif., Saturday Feb. 6, 2010. Mandatory evacuation orders were in place for at least six homes in the La Canada Flintridge area after heavy rains overflowed debris basins, carried away cement barricades and swept cars into storm drains. (AP Photo/Mike Meadows)
…
A car crushed by flood waters is buried in mud on Ocean Boulevard Saturday Feb. 6, 2010 in La Canada Flintridge, Calif. Mudslides damaged up to 10 foothill homes and dozens of vehicles north of Los Angeles Saturday as an intense winter storm brought down hillsides in wildfire burn areas. (AP Photo/Mike Meadows)
“It never rains in California, but girl, don’t they warn ya?
It pours, man, it pours.”
- The Mommas and the Poppas
Actually, the performer was Hammond Albert. He wrote the lyrics too. He also wrote “The Air That I Breathe,” which was a big hit for The Hollies.
yeah the Mamas and Papas were commercial all right but not that damn commercial.
Nothing like a spate of bad weather to help rule out areas for future home buying and at the same time lower existing house prices.
“…to help
ruleroot out areas…”In California, the least affordable houses are often in the most hazardous locations, places one should never build unless prepared to take a total loss on a recurring basis.
My two favorite California wildfire videos from The Onion:
http://www.theonion.com/content/video/californians_gather_to_celebrate
http://www.theonion.com/content/video/obama_to_enter_diplomatic_talks
(Sure wish Oly were around to offer a follow on remark about sleazy real estate developers…)
“Rrribet, rrribettt”
I just wish she was still around. There has been a great disturbance in the HBB force.
Honestly, I have thought about her often…It is kind of confusing, why…I never met her but I felt I new her and I do miss her…
I miss her too, and think about her often. It’s weird because there’s no one else in my ‘real’ life that knew her or could offer much sympathy. And, for that matter, I didn’t know her in ‘real’ life. But I sure do miss her in real life.
Ah well…I bet I know what she’d say to us:
“Shut up and drink some margaritas, ya wussies! It’s SouperBowl Sunday!”
And she’d be making some crazy celebratory soup.
Verily.
Alpha, I am surprised how much I “hear” her as well. I actually think of her often when I look at my kiddos.
May the Oly force be with you on Souper Sunday.
But will they let them rebuild?
I think anyone in certain flood zones, etc. should not be able to rebuild or at least take on all the risk if they do. There are certain places that just shouldn’t be occupied.
And those ‘certain places’ are precisely where real estate developers find mother nature’s best opportunities to provide affordable housing!
And those ‘certain places’ are precisely where real estate developers find mother nature’s best opportunities to provide PROFITABLE housing!
There. That’s better.
In SoCal, this seems to go in cycles. Houses built in poor locations for obscene prices. Some natural disasters make those houses untenable. Locals scream that nothing should be built there. Local ordinances are developed that prohibit building in those areas. Wait a few years, then relax those strictures. City gets paid off by developers. Houses built…
In Sacramento, that’s Natomas. Bad flooding risk there, as well as the fact that it’s built up on formerly good farmland. My parents fought for years to keep developers off there, but the developers were persistent and eventually, enough people didn’t realize the problems that the developers got their permissions.
A lot of people who bought there had no idea of the flooding risk until about four or five years back, when the feds took another look at the levees, decided they weren’t as good as formerly advertised, and hit the residents with a large increase in flood insurance fees. I do feel a little sorry for them, because not everybody has parents with a good grounding in geology. (We did our own due diligence before purchasing and aren’t at risk unless the whole valley becomes an inland sea again.)
Lawrence Yun will be on C-Span’s Washing Journal call-in program tomorrow morning sometime between 7 and 10am EST, presumably to talk about the torrent of demand to be unleashed following today’s Super Bowl.
I wish my TV could broadcast both ways. I so want to moon that asshat.
You misspelled “Souper Bowl”
(After five years of bubble sitting, I find myself yet again typing the same joke!
Need some new material…)
I misspelled Washington too, still waking up here. He will be one of the later guests, probably coming on between 8:30-9:30am. All HBB’rs with the time and patience are encouraged to phone in and call him out on his UHS propaganda.
Lawrence Yun
thanks for the heads up!
let’s start tossing around succinct, poignant, questions that bring out the truth of the situation (and of course make him look bad). Questions we can actually ask should we get on air.
ie. renters rights, mobile workers hindered by homeownership, rationality of strategic defaults…..
http://news.yahoo.com/s/ap/20100205/ap_on_re_eu/eu_latvia_town_for_sale
Latvia Ghost Town Auctioned Off for $3.1 Million.
An abandoned former Soviet garrison town of soulless apartment buildings once “home” to 5,000 miserable alcoholic souls at a vast radar complex just went on the auction block. You know, they’re not building Latvian ghost towns anymore….
Why would anyone want that ? I can’t figure it out. Surely there must be better ways to spend ( invest ? ) one’s money in Latvia than putting it into rotting, concrete cubes full of leaks, rats, and mold. Has anyone seen “The First Day After” series about what manmade structures would disintegrate first if man vanished from the earth ? It’s on the History Channel or its ilk. I might have the series’ name wrong, but I’ve drinking Diet Coke heavily in preparation for the game.
From the article:
“……..the town was sold to a Russian investor is bound to disturb Nationalists in Latvia………”.
“United States Nationalist”. Sounds good to me.
Much better, and more accurate, than “racist Minuteman”
“I’m not prejudice against…………. To me, you are all equally worthless.”
Why buy now in San Diego? Since home prices have bottomed out, real estate can only go up from here, or so I have been told by the residential real estate price forecasting ‘expert’ cited in the San Diego Union-Tribune.
Built to sell: Local response to a changing market
By Roger Showley, UNION-TRIBUNE STAFF WRITER
Sunday, February 7, 2010 at 12:04 a.m.
San Diego County home builders, who downsized and scraped by in 2009, are coming back in the opening weeks of 2010 with more than a dozen new projects that feature smaller and simpler floor plans, lower prices, more use of sustainable “green” technology, and less frills and waste than was common in the oversize “McMansions” of the past decade.
Buyers seem eager see what’s new, judging by the 2,500 people who showed up at Pardee Homes’ 108-home Terramar project, which opened Jan. 16 east of Carmel Valley, and the 11 buyers at the ColRich Group’s 38-unit Solterra, who are in escrow even before the grand opening Feb. 20 in La Costa.
“Things are selling and the outlook is good,” said Bob Cummings, president of the Barratt Group, who was installed last weekend as president of the Building Industry Association of San Diego County. “Buyers realize we’ve hit bottom and there are signs, especially in San Diego, that overall pricing is going up.”
…
Trudi Kuo and daughter Sara looked over a child’s bedroom at the recent grand opening of a California West development called Madison Lane in Vista.
John Gastaldo / Union-Tribune
…
Alison Roach (left), with her parents Stephen and Christy, recently toured the model homes at Pardee’s Terramar development in Rancho Peñasquitos.
Photo by John Gastaldo - UNION-TRIBUNE
“Buyers realize we’ve hit bottom and there are signs, especially in San Diego, that overall pricing is going up.”
I can believe “buyers” might believe we’ve hit bottom. But, is that reality. I doubt it.
Good point. All the people who know you haven’t hit bottom are … not buying! That includes me.
Bear, J6P will pay as much money as he can raise. As long as he can raise absurd amounts of money, with the government picking up the pieces when he defaults, selling prices will remain high.
I wonder if there’s some graph which maps home prices and foreclosure rates.
Nice to see the public pension backlash heating up. Comments from Today’s Boston Globe story on police retirements:
http://www.boston.com/news/local/massachusetts/articles/2010/02/07/police_exodus_stirring_concern/?comments=all&plckCurrentPage=2
Again, the pension “topic” is a manufactured distraction by the bankers.
SOL time for migratory home equity locusts…
AP: More migration has meant more economic stress
By MIKE SCHNEIDER, Associated Press Writer
Saturday, February 6, 2010 at 9 p.m.
Christy Nameche moved with her family to Kendall County, Ill., in 2007, joining thousands of other hope-filled newcomers who made the county No. 1 in population growth in the nation that year.
Nameche liked the farms around her new neighborhood, the fact that she could see the stars at night and the chance to raise her two children with other young families who were pioneering this far-flung Chicago suburb.
Like so many other families, their timing was off.
Just two years later, the developer of Nameche’s new neighborhood has gone bankrupt, some neighbors face foreclosure, many lots sit empty and the long-awaited conversion of an adjacent field into a town park is stalled. Kendall County is struggling, another once-booming American locale gone bust.
…
In this Jan. 20, 2010 photo, realtor Dennis Stone stands in a subdivision in Montgomery, Ill., in Kendall County. The term ‘upside down’, when a home’s market value drops below the amount owed on the mortgage, is one that many taxpayers in Kendall County have learned the hard way. Two years after the start of the Great Recession, signs of the housing bust are everywhere. Construction jobs have disappeared, the county has seen a wave of foreclosures and thousands of lots that were prepped for building homes sit empty. (AP Photo/Charles Rex Arbogast)
…
Million dollar home owner wedgie time!
Million-dollar-plus home sales fall in ’09
By Roger Showley, UNION-TRIBUNE STAFF WRITER
Friday, February 5, 2010 at 12:04 a.m.
Million-dollar-plus home sales in San Diego County slipped for the fourth straight year in 2009, MDA DataQuick reported yesterday, proof that the real estate slump continues at the top end even as sales pick up at the bottom.
San Diego’s total of 1,578 transactions was 28.8 percent off the 2,216 sales of 2008 and 63.2 percent off the record 4,287 in 2005. Million-dollar-plus sales in Southern California declined 19.4 percent; statewide, they were off 23.8 percent.
Locally, La Jolla regained its No. 1 status with the most sales, 259, last year after falling behind Carmel Valley in 2008.
Besides seeing fewer sales, the high-end market was not immune to the distress that plagued much of California housing last year.
DataQuick said there were 4,925 default notices against million-dollar-plus homes last year and 2,698 went through foreclosure.
An additional 1,900 homes that previously sold above $1 million sold for less last year. The median price decline was about $420,000 and the median percentage decline was 35 percent.
…
La Jolla & Carmel…great places to visit…whether “renting” x4 walls with a view or camping.
Given a good deal on an ocean view house in La Jolla or Carmel (at the same price), I would not know which one I’d buy. Both are wonderful places but somewhere between ten and fifteen degree temperature differences!
“Carmel Valley”
Not to be confused with Carmel where Clint Eastwood was once mayor, Carmel Valley is a neighboring town to La Jolla where myriad large McMansion tract homes were built on top of a permanently high plateau, at least physically speaking, and sold in the $1m+ price range at the bubble top. Apparently the plateau was not quite so permanently high in financial terms…
Ah, I remember seeing the exit to Carmel Valley when I was down that way a few times. But there is also a Carmel Valley east of the town of Carmel - Clint Eastwood’s!
http://maps.google.com/maps?hl=en&tab=wl
I guess I just assumed since they were talking about San Diego, they meant the local version of Carmel Valley; after your post, Bill, I am not sure…
There are also two Brentwoods in CA: one in LA and the other in the Sacramento River delta.
The California governor has pitched a plan to rebuild the state’s prosperity on a reflated housing bubble.
Why not reach back a bit farther in state history and try to restart the gold rush that got the California economy off to such a rollicking start in the late 1840s? There’s gold in them thar hills (and the houses built on ‘em)…
Governor visits Chula Vista to pitch aid for homebuyers
By John Marelius, UNION-TRIBUNE STAFF WRITER
Saturday, February 6, 2010 at 12:04 a.m.
Gov. Arnold Schwarzenegger greeted construction worker Michael Stahl yesterday as Joe Lunardon (right) looked on at the Trellis at Windingwalk housing development in Chula Vista.
K.C. Alfred / Union-Tribune
Gov. Arnold Schwarzenegger greeted construction worker Michael Stahl yesterday as Joe Lunardon (right) looked on at the Trellis at Windingwalk housing development in Chula Vista.
Gov. Arnold Schwarzenegger visited an under-construction housing development in Chula Vista yesterday to promote his proposal to extend and expand the state’s $10,000 homebuyer tax credit.
“This area has been hit hard by the foreclosure crisis, and we need to get people out there and buying homes — that’s the important thing — so we can build more homes and so we can put people back to work,” he said at the Trellis at Windingwalk development being built by Brookfield Homes.
Schwarzenegger said that the Brookfield development in Chula Vista saw a 300 percent increase in sales last year when the state’s $100 million tax credit program was open to buyers of new homes but that sales declined after the money ran out.
Seventy percent of the purchasers of Brookfield houses used the tax credit, he said.
This year, the governor wants to double the size of the program and make it available to purchasers of existing homes as well as new ones.
“The first one was $100 million. Now, the second one is for $200 million because we really were not aware of how hot it’s going to be and how many people are going to take advantage of it, and that really it made home sales go up and people go back into building homes,” Schwarzenegger said.
“That means people go back to work, if it’s the framers, if it’s the roofers, if it is the electricians, if it is the carpenters, if it is the plumbers. Everybody gets a job right away again,” he added.
He acknowledged the state is limited in what it can do to spur economic recovery but said: “We only have a small amount of power when it comes to bringing the economy back or creating jobs, but whatever power we have, let’s use that power. And that’s what this initiative is all about here.”
If the Legislature passes the full tax credit by May 1 as Schwarzenegger has called for, the state estimates it will provide assistance for the purchase of 14,775 new homes and 5,700 existing ones.
The homebuyer tax credit is a major element of a $500 million jobs package that Schwarzenegger announced in his State of the State address last month that seeks to create 100,000 jobs and train 140,000 workers.
“I made it very clear that with all the big challenges that are ahead of us this year and the things we want to accomplish, the most important thing for us is to bring our economy back and to bring jobs back,” Schwarzenegger said.
…
“The first one was $100 million. Now, the second one is for $200 million because we really were not aware of how hot it’s going to be and how many people are going to take advantage of it, and that really it made home sales go up and people go back into building homes,” Schwarzenegger said.”
New Recruits for the “TrueAnger™” PeeParty tea toaddlers …don’t forget to Yell / Scream / Holler:
“The GOP is the party of: Fiscal Conservatives!”
“The GOP is the party of: Fiscal Conservatives!”
“The GOP is the party of: Fiscal Conservatives!”
“Fiscal Conservatives”
The whole aim of practical politics appears to have evolved into using meaningless labels, lies and public relations campaigns to manipulate the electorate into voting the candidate back into office.
The Power of Jargon
http://www.youtube.com/watch?v=x1A6CuTBi9U
Uhm, it’s ALWAYS been that way.
So, the aim is to:
1. Audit the FED
2. Dismantle Megabank Inc.
3. Eliminate political influence via mass media
With which political party?
Who had the zillow link to the 1.5 million dollar (2007 or 2008) chula vista home now worth $600 k?
“We need to get people out there and buying homes-that’s the important thing-so we can build more homes and so we can put more people back to work”
US census bureau:
2008 Ca. population - 36,756,666
2008 Ca. housing units -13,393,878
Wow, why didn’t I think of that? Maybe it’s like Field of Dreams -if you build it, they’ll come, Arnie?
Who let that guy into my state, anyway?
So are you saying that “supply side” economics is a bad idea?
The stimulus Americans hate to love and love to hate:
Stimulus spending lacks punch of the WPA
By Dean Calbreath, UNION-TRIBUNE STAFF WRITER
Sunday, February 7, 2010 at 12:04 a.m.
Seven decades have passed since the Great Depression ended, but it’s not hard to see the legacy the New Deal left behind.
…
When Roosevelt showed up to dedicate the County Administration Center in 1938, he said he especially liked the motto inscribed on the building: “The noblest motive is the public good.” Speaking from the rear seat of his convertible, he told a crowd of 25,000 that “if we all carry that motto in our hearts, in every city and community throughout the land, there is no question but that the proper thing, American democracy, will survive.”
Seven decades from now, it’s hard to imagine what our great-grandchildren might see when they look for traces of the American Recovery and Reinvestment Act, or ARRA, which was enacted a year ago this week with the WPA-like goal of pulling the nation out of the Great Recession.
And that could be one of the biggest problems with last year’s $787 billion stimulus program: It’s been so amorphous that it’s been hard for anybody to determine how many jobs have been created or to point to any notable achievements that could bring it into clearer definition.
Maybe that’s one reason why so many Americans hate the stimulus while loving its basic tenets. A CNN/Opinion Research Poll last Sunday showed that 56 percent of Americans oppose the stimulus, while 42 percent support it. Roughly 80 percent want the stimulus to be used to fix roads and bridges; 80 percent want more aid for the jobless; 70 percent favor using the stimulus for tax cuts; and 60 percent want the money to be used for mass transit.
What many folks don’t realize is that the stimulus included all those things, which has arguably made it less effective than FDR’s sharply defined programs.
…
Your great-grandchildren will just need to head out to The Hamptons to see the monuments to Obama’s $787 billion stimulus.
Maybe MTV’s “Cribs” could do a feature on Megabank CEOs digs to immortalize the moment.
NO.
The WPA and CCC actually built things by hiring people to do hard manual labor at a wage that basically paid for their food and housing. Some of them lived in tents to be close to their wor sites. No work, no pay.
The 1 trillion dollars in obama stimulus money went to bail out bankers, local/city state unions, auto unions and foriegn banks.
Exactly.
The Hoover damn is a prime example. There is NOTHING similar today.
Nothing.
I’ve recently discovered the WPA “writer’s project” guides to the (then) 48 states. Goood reading even today. They give one a snapshot of what the US was like back in the late 1930’s.
The list of authors in the writer’s project is shocking.
Conrad Aiken
Nelson Algren
William Attaway
Saul Bellow
Max Bodenheim
John Cheever
Loren Eiseley
Ralph Ellison
Vardis Fisher
Zora Neale Hurston
Weldon Kees
Claude McKay
John Steinbeck
May Swenson
Studs Terkel
Jim Thompson
Richard Wright
Frank Yerby
Margaret Walker
Dorothy West
Anzia Yezierska
“John Steinbeck”
A great American novel is born…
who says stimulus money necessarily won’t produce something of enduring value?
Steinbeck didn’t have it so easy in his day. Salinas, CA banned and burned his books.
Any genealogical relationship to Rash Limpbaughs?
“That’s not stimulus…that’s spending!”
The WPA paid for a lot of different types of art, many of which decorated the public works projects.
Yeah, these are super cool. We bought the guides for CA and NY on eBay.
Really? Tell me one thing the “Non-Hawaiian” could do that the repubican’s would acknowledge to our Nation as having accomplished any good, other than releasing his birth certificate & maternal DNA…There’s more hatred for lil’ Opie…then was ever thrust at Lincoln from the South…you know I have a feeling listening to MUrDoch’s Faux news …that they could convince our Nation that Lincoln would just throw-up knowing that a “somewhat” African American “Non-Hawaiian” was ever fraudulently elected to the be president of the US of A..yep, old Abe he be disgusted at lil Opie and would just suck the teet of GOP Shelby…
Hard times push more women to strip clubs
http://www.ajc.com/business/hard-times-push-more-292179.html
Kind of off-topic, but
The most disturbing show on TV is “Toddlers in Tiaras”.
(Disclaimer: My mother was watching it last night, God knows why.)
If Nielson surveyed it, it would rank #1 in the “18-34 male pedophile” segment.
They were at a show in Atlanta somewhere. Noticed that the mom’s are now starting to give their daughter “Stripper” names for the “shows”. Makes me just want to slap some people and yell “What the hell is wrong with you??”
I’ve seen that one a few times. I think it is most interesting that the smaller kids are perfectly happy with a crown or teddy bear for some small title (third runner up in best snapshot or something). They just like getting a toy or a sparkly thing and being told they did a good job at something and getting some attention. They don’t get upset until they figure out from their parents’ reaction that they didn’t win enough. Oh, and they cry when they get spray tans or their hair done or have to put on their dresses or get tired or hungry or have to go on a long car ride or….well you get the idea. They cry a lot.
The older kids (6 and up) have started to understand the process. They are really scarey.
Former cheerleaders living vicariously thru their daughters. Sort of like the High School jocks pressuring their sons to play football.
Sort of?
Many, many people really should not breed.
“Hard times” are somehow connected to “strip clubs”? Who’d ‘ave thunk…
“How we got the story
Police reporter Megan Matteucci noticed scores of women lined up at Atlanta Police headquarters every time she went to pick up reports. Detectives there told Matteucci the women were applying for a license to strip. Intrigued, Matteucci made a Freedom of Information Act request for numbers on adult- entertainment permits and talked to veteran business reporter Tammy Joyner, who thought the spike might be connected to the economic downturn. The reporters, along with photographer Bita Honarvar, visited and contacted a number of clubs. Joyner and Matteucci also talked to permit applicants, dancers, club owners, police officials, women’s rights groups, economists and adult-entertainment industry officials.”
-Atlanta Journal article
According to a friend who visits such establishments, there’s alot less money in that now. Stands to reason, fewer newly rich mortgage borker and REICers. I’d bet that during the bubble, there were a fair number of lapdances that ended up added to the HELOC.
ITEM: HARTFORD, Conn. (AP) — A federal U.S. judge ordered jet engine maker Pratt & Whitney to halt its plans to move 1,000 jobs out of Connecticut and to Japan , Singapore and the state of Georgia.
U.S. District Judge Janet C. Hall in Bridgeport issued a permanent injunction, stopping the company’s plans to shift the jobs. Who “owns” the jobs?
< In effect the labor union told Pratt & Whitney that despite the fact the company can’t economically keep the Connecticut operation staffed at former levels, it can’t shift 1,000 jobs elsewhere in order to bring costs under control.
The union is saying the unionized worker “owns” the job, not Pratt & Whitney. This flies in the face of the adage “He who owns the tools owns the job.” Pratt has one ace up its sleeve. It can close. And it will if the union forces it to lose money.
union is saying the unionized worker “owns” the job?
Sounds like the government unions that run Cali…
What legal justification did the judge use? Was there a contract in place that promised that the jobs wouldn’t be moved? If so, it sounds like a stupid company that did a crummy job negociating their contract.
Or does Connecticut elect judges?
No Hall is a Fed. Dist. judge.
Odd that it’s a permanent injunction. I could see a TRO or a preliminary injunction until all the facts were in…
My brief google on it turns up that it followed a 5 day trial, which explains the permanent injunction, and that the injunction applies to a contract that expires in Dec. 2010.
“Among other things, Hall - who ruled for the union in a similar dispute a decade ago - found the company demanded unreasonable concessions from the union in order to keep the work in Connecticut.” (Hartford Courant.) The contract @ issue apparently required the co. to make reasonable efforts…
OK it’s a Phyric victory at best. The injunction only lasts until December 2010 when the existing labor contract expires.
See for example
http://www.courant.com/business/hc-pratttrialdecision.artfeb06,0,1810189.story
This is more significant than most might imagine.
It’s not so much does a union “own” the job (and - by default, for now, the worker), but which country does. And which country’s government “earns” the taxes.
A case of who gets to confiscate who’s assets.
Thanks for the heads up, wmbz. I expected this to happen, but not for another 5-7 years, once several entitlement-based economies have shut their doors.
Read the story guys.
The contract with the union required that both parties make a “good faith effort” to keep jobs in Connecticut.
P&W/UTC instead, chose to ship these positions out, primarily to get rid of these people before the next contract was to be voted on.
As a long time purchaser of Pratt and Whitney parts and services, I can assure you that any savings they get by shipping jobs south/overseas is NEVER passed on to the customer.
Depends on who the customer is.
How about overseas customers? How about overseas governments? Do they realize a savings because more of their population is working rather than on the local public dole? Does the local population save money by not having to cough up more money to take care of those not working?
Speaking rhetorically, of course.
So Pratt and Whitney, who has large, long term government contracts that sure as hell weren’t negotiated for bottom dollar, can’t make a profit?
(yes, I do know about the cut back in military jet orders)
Also, like XGS-Fixer says, do you really want people making min wage to be working on highly complex and dangerous precision machinery that thousands of other people lives depend on?
http://www.marinij.com/marinnews/ci_14351622
Another update from Marin County, CA, you know, the Bay Area’s most “special” county, where everyone is rich and financially savvy. My favorite bit from the article:
“As fellow renters in San Rafael, the McCords felt the same pressure as the Steins. In 2006 and amidst massive buyer demand, they succumbed to the pressure of a frenzied market, offering $665,000 for a 1,000-square-foot home in the San Marin area of Novato. Despite stable jobs, the couple nervously awaits the resetting of their interest-only loan in mid-summer, with their home having lost nearly 30 percent of its value.
“We just got caught up in the craziness of it all and didn’t wait long enough,” McCord said. “We knew what we were doing. We didn’t get scammed or anything. We just took a gamble that we could make this kind of loan work for us in Marin County, which we felt was pretty isolated from the risks, and it hasn’t worked out.”
“We wuz dum.”
http://www.marinij.com/marinnews/ci_14351622
Forgive the possible double post….another update from Marin County, CA, you know, the Bay Area’s most “special” county, where everyone is rich and financially savvy. My favorite bit from the article:
“As fellow renters in San Rafael, the McCords felt the same pressure as the Steins. In 2006 and amidst massive buyer demand, they succumbed to the pressure of a frenzied market, offering $665,000 for a 1,000-square-foot home in the San Marin area of Novato. Despite stable jobs, the couple nervously awaits the resetting of their interest-only loan in mid-summer, with their home having lost nearly 30 percent of its value.
“We just got caught up in the craziness of it all and didn’t wait long enough,” McCord said. “We knew what we were doing. We didn’t get scammed or anything. We just took a gamble that we could make this kind of loan work for us in Marin County, which we felt was pretty isolated from the risks, and it hasn’t worked out.”
“We just took a gamble that we could make this kind of loan work for us in Marin County, which we felt was pretty isolated from the risks, and it hasn’t worked out.”
How could they think one of the myriad ‘ground zero’ poster children for bubble pricing could be isolated from the risks?
Yeah Novato. My sister used to work there. It’s not a special place. The real Marin is Mill Valley, Corte Madera, Larkspur, and San Rafael. But Mill Valley is the higher up place. Even so, those places have pockets of low income housing.
$665k. That couple were out of their freakin’ minds! Hell yes, they certainly gambled and lost! Real estate only goes up! LOL.
As fellow renters in San Rafael, the McCords felt the same pressure as the Steins.
Whoa! The Steins in that article include my old boss John! (My former company is based in Marin.)
We had some conversations in 2007 and 2008 about the absurd real estate prices in Marin. A 30% discount is pretty good, but I’m afraid Ol’ John may still be a knifecatcher.
Secret summit of top bankers.
* Herald Sun * February 06, 2010
The high-powered gathering coincides with a fresh meltdown on world
THE world’s top central bankers began arriving in Australia yesterday as renewed fears about the strength of the global economic recovery gripped world share markets.
Representatives from 24 central banks and monetary authorities including the US Federal Reserve and European Central Bank landed in Sydney to meet tomorrow at a secret location, the Herald Sun reports.
Organised by the Bank for International Settlements last year, the two-day talks are shrouded in secrecy with high-level security believed to have been invoked by law enforcement agencies.
Speculation that the chairman of the US Federal Reserve, Dr Ben Bernanke, would make an appearance could not be confirmed last night.
The event will be dominated by Asian delegations and is expected to include governors of the Peoples Bank of China, the Bank of Japan and the Reserve Bank of India.
The arrival of the high-powered gathering coincided with a fresh meltdown on world sharemarkets, sparked by renewed concerns about global growth and sovereign debt.
Fears countries including Greece, Portugal, Spain and Dubai could default on debt repayments combined with disappointing US jobs data to spook investors.
“The high-powered gathering coincides with a fresh meltdown on world
THE world’s top central bankers began arriving in Australia yesterday as renewed fears about the strength of the global economic recovery gripped world share markets.”
Does this explain why so many bankers skipped out on Davos this year?
Extra! Extra! Read all about it!!!
02/06/2010 02:14 PM
World´s Top Bankers Meeting in Secret in Australia
Representatives for 24 central banks and money authorities, including the US Federal Reserve and European Central Bank, have landed in Sydney, Australia. They plan to hold a meeting at a secret location tomorrow. Many important bankers will attend.
Many Asian delegates, including governors of the Peoples Bank of China, the Bank of Japan, and the Reserve Bank of India, will hold a meeting with Dr. Zeti Akhtar Aziz, governor of the Central Bank of Malaysia, who will chair.
General manager of BIS, Jaime Caruana, will take a prominent role in the talks, at a time when his company is overhauling the global banking system with more rules and standards. Ben Bernanke, chairman of the Fed, may attend but this is unconfirmed.
…
Latest from the UK Telegraph:
Greek Ouzo crisis escalates into global margin call as confidence ebbs
By Ambrose Evans-Pritchard
Flow data shows an abrupt withdrawal of German and Asian capital from Club Med debt markets. The EU’s refusal to offer Greece anything beyond stern words and a one-month deadline for harsher austerity – while admirable in one sense – is to misjudge how fast confidence is ebbing. Greece’s drama has already metastasised into a wider systemic crisis. The world risks a replay of the Lehman collapse if this runs unchecked, this time involving sovereign dominoes.
Barclays Capital says the net external liabilities of Greece are 87pc of GDP, or €208bn (£182bn). Spain is worse at 91pc (€950bn), and Portugal worse yet at 108pc (€177bn); Ireland is 68pc (€123bn), Italy is 23pc, (€347bn). Add East Europe’s bubble and foreign debts top €2 trillion.
The scale matches America’s sub-prime/Alt-A adventure and assorted CDOs and SIVS of the Greenspan fling. The parallels are closer than Europe cares to admit. Just as Benelux funds and German Landesbanken bought subprime debt for high yield with AAA gloss, they bought Spanish Cedulas because these too had a safe gloss – even though Spain’s property boom broke world records. They thought EMU had eliminated risk: it merely switched exchange risk into credit risk.
A fat chunk of Club Med debt has to be rolled over soon. Capital Economics said the share of state debt maturing this year is even higher in Spain (17pc) than in Greece (12pc), though Spain’s Achilles’ Heel is mortgage debt.
The risk is the EMU version of Mexico’s Tequila crisis or Asia’s crisis in 1998. This Ouzo crisis is coming to a head just as tougher bank rules cause German lenders to restrict loans, and it touches on the most neuralgic issue of our day: that governments themselves are running low. Britain, France, Japan, and the US are all vulnerable. All must retrench. The great “reflation trade” of 2009 is over.
Far from containing the crisis, Europe’s response recalls the Lehman/AIG events of 2008 when Brussels sat frozen, and Germany dragged its feet. On that occasion France took charge, in the nick of time.
Today’s events will not wait. The rocketing cost of (CDS) default insurance on Iberian debt speaks for itself. Lisbon retreated from a €500m bond issue last week, even before the government lost a crucial finance vote. Can Athens raise money at all on viable terms?
There are echoes of early 2009 when East Europe blew up, with contagion hitting global bourses, commodities, and iTraxx credit indices. That episode was halted by the G20 deal to triple the IMF’s fire-fighting fund to $750bn. The odd twist today is that Greece cannot turn to the IMF because that offends EMU pride, yet no other help is on offer because the EU has no fiscal authority. Greece lies prostrate between two stools.
Both the City and Brussels seem certain that Europe will conjure a rescue, crossing the Rubicon towards fiscal federalism and a debt union. The emergency aid clause of Article 122 is on everybody’s lips. Insiders talk of a “Eurobond”.
On balance, such a rescue is likely. Yet leaving aside whether North Europe can afford to guarantee Club Med debt – or whether a bail-out pollutes more countries, as HBOS polluted Lloyds – there is one overwhelming fact missing from the debate: Germany has not endorsed any such rescue.
Jurgen Stark, Germany’s champion at the European Central Bank, said markets are “deluding themselves” if they think others will pay to save Greece. He shot down Article 122, saying Athens was responsible for its own mess.
Bundesbank chief Axel Weber said it would be “politically impossible” to ask taxpayers to bail out a profligate state. Both the finance and economy ministers have forsworn a rescue. Die Welt has called for Greek withdrawal from the euro.
I cannot judge how much is brinkmanship, pressure to make Club Med sweat. But I remember vividly lunching with the British prime minister’s economic adviser in August 1992 and being told that Germany would soon rescue sterling in the Exchange Rate Mechanism by cutting rates. Such was the self-deception of the British elite. Anybody following German politics – such as George Soros– knew it was nonsense.
Germany is harder to read today. The euro is a giant step beyond the ERM. Yet there are powerful counter-currents. Germany’s constitutional court issued a crushing put-down of EU pretensions last June, ruling that the sovereign states are “Masters of the Treaties” and that EU bodies lack democratic legitimacy.
So if you are betting that Germany must forever more efface itself for the European Project, be careful. Berlin hawks might prefer to lance the Club Med boil sooner rather than later.
Lesson I learned long ago: If you don’t want to wake up in a girls’ dormitory and wonder how you got there, never wash down your beers with Ouzo…
I would think the true lesson there is “ALWAYS down your beers with Ouzo.”
I’ve have a few Ouzo escapades of my own. But those files are permanently sealed.
The great epochs of our lives occur when we gain the courage to rebaptize our past evil as our best.
– Friedrich Nietzsche –
Tinfoil hat time.
I think most of us agree that the years 1944-1970 were the peak of US power and influence, no matter what the endeavor.
It was also the peak time for the amount of radiation and fallout from nuclear testing floating around in the atmosphere.
Coincidence? I think not. I’m starting to believe that all that radiation floating around mutated our brains, causing us to be extra-smart for a limited period of time.
Elimination of atmospheric nuclear testing cause a “reversion to the mean”.
Conclusion: Let’s go set off some nukes in Nevada. Sell tickets for the show. Or put it on Pay-per View.
Or set a few off over OSB’s hole in Pakistan. Close will be good enough.
Close, but no cigar.
It was in the 1970s that many, many foodstuffs began using HUGE amounts of chemicals from farm to processor to market.
I remember the big fight over saccharine. And the beginning of the switch from sugar to corn syrup and lot and lots of preservatives and the explosion of the junk food markets.
The 1980s saw the crippling of the FDA. All you need to know can be summed by the single example of the FDA around the turn of the century FORBIDDING the testing of herds for Mad Cow.
No need for tin foil. Seriously.
WRRRRRRROOOOOOOOOOONNNNNNNNNNGGGGGGGGGGG!!!!!!!
The saccharine and corn syrup didn’t have enough plutonium/nuclear byproducts in it. Thus the need for more preservatives.
And it’s well known that the proliferation in hormone additives have dramatically increased the average breast size of the US female population. Find one US Male who thinks that is bad, and I’ll show you a Commie who probably voted for Obama.
“And it’s well know that the proliferation in hormone additives have dramaticlly increased the average breast size of the US female population.”
And somehow these hormones transformed the structure of these women’s breasts from flesh to silicon.
This doesn’t have anything to do with the housing bubble, but it was so funny I thought you also might get a good laugh out of it. It’s a review of a book: Ignorance Is Blitz.
“Compiled by Professor Anders Henriksson from the term papers and blue book exams of students who clearly made it to college before the advent of “No Child Left Behind,”Ignorance Is Blitz is unput-downable. You won’t believe what you just read, and won’t want to wait to see what’s coming next, from the Virgin Mary’s Immaculate Contraption to Pericles’ greatest erection, the Parthenonon to Custard’s Last Stand to Hitler shooting himself in the Bonker and Martin Luther King’s ground-breaking speech, “If I Had a Hammer.” And who knew: Caesar was assassinated on the Yikes of March, when he is reported to have said, “Me too, Brutus.” Rasputin was a pheasant by birth. Victims of the black plague grew boobs on their neck. Judyism had one big God named Yahoo. Marie Curie won the Nobel Prize for inventing the radiator. And “During the Dark Ages, it was mostly dark.”
There are many WITH degrees are just as… “enlightened.”
JDinCT, you asked the other day what steal meant to me — my realtor just closed a waterfront townhouse for $180k, sold for $398k in 2005.
BTW, if my realtor can put together another deal like that, I will buy. That’s $108/sq.ft. for waterfront (boat slip extra)
Banks on the run, banks on the run
And the jailer man and sailor Sam
Were searching everyone
For the banks on the run, banks on the run
The Financial Times
Banks face attack from all angles
By Patrick Jenkins and Gillian Tett
Published: February 1 2010 02:00 | Last updated: February 1 2010 02:00
In the streets of Davos at the weekend, protesters were handing out leaflets. But their anger was not directed against world poverty, nuclear power or war; they were demanding that banks should put their derivatives business on to exchanges to make the financial system more transparent.
It is a potent reminder of how issues about financial stability dominated the agenda at the World Economic Forum last week.
International supervisors, led by the Financial Stability Board and the Basel Committee on Banking Supervision, are pondering how they should change the levels of capital and liquidity that banks will have to hold in future. Moreover, recently, politicians - Barack Obama, the US president, Alistair Darling, the UK chancellor, and French president Nicolas Sarkozy - have weighed in with measures, short-circuiting the more consultative regulatory response.
Whether the banks could claim victory for their lobbying at Davos remains unclear, partly because the financial industry is fighting on many fronts. One issue that dominated discussion at the WEF was proprietary trading - and the putative move by the Obama administration to ban the activity at banks that take insured deposits.
Most bankers opposed the idea. Frédéric Oudéa, chairman and chief executive of Société Générale, said: “There is a process already under way in Basel. We need it to remain an orderly process in which regulators take the lead role and organise the dialogue with the banking industry. Otherwise there will be confusion, uncertainty and additional pressure on the financial system.”
…
I suggest the Fed will figure out a way to screw middle class Americans out of more of their wealth in order to make sure the Wall Street bankers’ bonus pool stays flush through the thick and thin of financial crisis.
The Wall Street Journal
* THE INTELLIGENT INVESTOR
* FEBRUARY 6, 2010
Will We Ever Again Trust Wall Street?
* By JASON ZWEIG
For many investors, the market’s turbulence hasn’t just destroyed wealth. It has shattered their faith in the financial system itself.
video
Time for Bankers to Say They’re Sorry
Intelligent Investor columnist Jason Zweig says for investor confidence to return to markets, there need to be more “perp walks,” apologies from bankers and other “necessary delusions” that get American capitalism firing again on all cylinders.
Consider Philip Eberlin, 56 years old, who runs a woodwork-restoration business in Chicago Heights, Ill. Trading hot stocks a decade ago, Mr. Eberlin got burned on picks like Krispy Kreme and Tyco. In 2007 he got back into stocks, only to take another hit.
“Having been burned twice in 10 years,” says Mr. Eberlin, he now has about 80% of his family’s assets “protected from the market” in certificates of deposit and fixed annuities. “I don’t have trust in Wall Street to help the small investor in any way, shape or form.”
Mr. Eberlin isn’t alone. Late last year, Decision Research of Eugene, Ore., asked Americans how much they trusted bankers and other Wall Street leaders “to reduce the risk of the financial challenges the country is facing now.” On a scale of 1 to 5, with 1 meaning no trust at all, the rating averaged a paltry 1.7.
With such a loss of faith, how will companies be able to obtain the capital they need to expand? The foundations of the financial markets ultimately rest upon the confidence of mom-and-pop investors across the country.
…
Government is no longer in charge. It is merely Wall St’s stalking horse and scapegoat.
Has been for a long time.
Gary Shilling says buy treasuries not RE
Deflation is hitting most Americans but not Government Employees he imagines there could be a tax payer revolt against Goverments and there generous pensions and saleries
gee ya think so
Of course. Because the bankers have enough money to perpetuate this distraction.
Forget the pensions. Keep your eyes on the bankers. The idea is that we the people should all be making good dough, not trying to take it away from other working stiffs. That’s the “divide and conquer” game.
Of course, they are the last big pocket of money liberals havent hit yet. Soon, there wont be any pockets to raid, what will socialism do then?
Double, double
Toil and trouble
Canada has
A realty bubble!
Luckily for U.S. citizens, the bubble will hence forth stay north of the Canadian border.
* The Wall Street Journal
* REAL ESTATE
* FEBRUARY 8, 2010
Housing Rebound in Canada Spurs Talk of a New Bubble
By PHRED DVORAK
TORONTO—Dominic Carrasco first tried to sell his studio apartment here in January 2009. The only offers the 42-year-old massage therapist got were well below the 166,900 Canadian dollars he’d paid for it five years earlier.
Last month, Mr. Carrasco tried again. The condominium was snapped up by the woman in charge of posting the information to the real-estate listing site, for C$209,900, or US$196,003, 40% more than the highest bid last year.
“I couldn’t believe it,” says Mr. Carrasco, who says he’s both relieved and unsettled by his change in fortune. “If my condo can go up that much in one year, it doesn’t make sense.”
As the U.S. struggles to get out of its housing slump, its neighbor to the north faces a different challenge: Canada’s housing recovery has been so rapid that some here are worrying about a bubble.
Last Wednesday, a housing-price index for Canada’s six biggest cities posted its seventh straight monthly gain, showing home prices in November are now back to their prerecession peak. Another broader measure shows the average home price in 2009 hitting a record. Home building has picked up too, with housing starts in December jumping to their highest level since October 2008.
Canada’s finance officials say they’re watching home prices carefully. The finance minister in December outlined steps he can take to cool things down, if needed. The central bank last month said it is watching the booming market with “vigilance, but not alarm.”
Some observers foresee trouble. “It’s a mania. It’s going to end badly,” says Garth Turner, a former Cabinet member who just published a book predicting that prices of real estate and other assets will fall.
…
* The Wall Street Journal
* COMMERCIAL REAL ESTATE
* FEBRUARY 3, 2010
Small Investors Lost It All in Memphis
By LINGLING WEI
The commercial real-estate mess is clobbering lots of investors. Few of them are reeling as much as the 27 owners of 1023 Cherry Road in Memphis, Tenn.
The office complex about five miles east of downtown tumbled into foreclosure last fall because the owners couldn’t refinance the $14 million loan used to buy the two glass-and-steel buildings in 2004. They also lost all $7.1 million they invested.
Cherry Road’s collapse is an ominous sign for thousands of other commercial real-estate deals in which mom-and-pop investors pooled their money to get a tiny piece of the action. As unemployment and fallout from the credit crunch fuel rising vacancies and declining rents, a growing number of small investors are getting wiped out.
“We ended up all losing collectively $7 million of lifetime savings,” says Lynn Rogoff, a New York artist who put $213,000 into the Cherry Road deal. Individual losses range from about $100,000 to $700,000, according to Cherry Road investors.
Many such deals were structured as so-called “tenant-in-common” ventures, known by the acronym TIC. Often, the TICs took out commercial mortgages that were packaged into commercial-mortgage-backed securities.
“Now, they’re starting to experience problems on the property levels,” says Marc Perusse, principal at RSS Advisors, a Denver firm that works with troubled TIC investors. “With the majority of TIC investments being syndicated from 2005 to 2007, the future of many of these assets is extremely bleak.”
New York artist Lynn Rogoff lost $213,000 in the 1023 Cherry Road development in Memphis, Tenn. She posed in front of the property in 2005.
CMBS delinquencies climbed to about 6.5% this month, an all-time high, according to Trepp, a New York company that tracks the commercial property market. More trouble is looming for small-time property owners because much of the $223 billion of CMBS debt coming due between now and 2013 is in the form of mortgages of less than $50 million.
…
“They lost all $7.1 million they invested.”
Poof.
“As unemployment and fallout from the credit crunch fuel rising vacancies and declining rents, a growing number of small investors are getting wiped out.”
Poof poof poof poof …
I’m not sure how I see their money went “poof poof poof”, by which I think you mean to imply it disappeared and made remaining cash more valuable. Did it really disappear? They essentially took their money out of the bank and gave it to somebody else. It did not disappear. This is no different than if I take $X out of the bank, I go to Vegas and lose all $x. No money goes poof poof poof but I “lost” all my money. The money that might have gone poof in this situation is the money the bank used to make up the difference between the 14 million dollar loan and the 7.1 million dollar down payment. And as far as that goes, I think the Fed is stepping up to the plate to make the bank whole, so the “sum of money” is still the same - or is there now even more money? *Somebody* received the $14 million. Either way, I don’t see any money going poof.
The only way a person’s money goes poof poof poof is if the person burns it in the fireplace, otherwise it just gets moved to somebody else. What am I missing?
“What am I missing.”
You are missing the part where money is created out of thin air, and at the same time an equal amount of debt is created. Sort of like matter and anti-matter in physics.
One person’s debt is another person’s money. If a debt is not honored then someone is out some money. The people who were owed these millions were deemed millionaires all the way up to the time they were declared broke.
What awaits? Pensioners who are promised lifetime pensions are at risk of having their pensions going poof. Where will the money go that was promised these pensioners? The answer: The money never existed in the first place. What existed was a PROMISE of money to be paid. A promise of money to be paid is a debt - it is money owed. Money owed that is not paid out is money that has gone poof.
If you put a million dollars in a bank account, you are still a millionaire even though the bank has the million instead of you, is this not so? This is because the bank owes you the million: The bank in in debt to you for a million dollars.
If the bank won’t pay you back then your million has gone poof. No matter what the bank did with the money you are still out the million, no?
Thanks for the reply. Actually, no, I don’t think my million has gone poof, it just belongs to somebody else instead of me. It wasn’t destroyed. It’s no different than If I had the million at home in a safe and somebody came and stole it. The money is not gone, it’s just no longer mine. I’m hurt as an individual, but whoever else has my money is better off.
When the Fed lets banks borrow money into existence at 0% interest and seemingly no payback, that’s just free money, there’s no real debt behind it, in some sense. As near as I can figure it for any money that’s really going “poof”, the Fed is trying to print the same amount to keep it a zero sum game or something.
I never felt your point was that *my* money has gone poof. I always feel your point is that money has been *destroyed* and therefore there is going to be deflation. To me all your “poof poof poof” statements imply that money has disappeared. I’m saying no money disappeared. The same amount of money is in the system. Yes, I don’t have *my* million. Somebody else has it. Vegas, maybe, or Wall Street Banksters. My money did not go poof. I lost it. If you’re just saying that I no longer have my money then I have it wrong. Of course I don’t have my money anymore. What’s the use of talking about how I gambled it away in Vegas?
What does it mean when banks won’t lend and private equity construction loans come with interest rates of 15%-20%? Let me guess, Combo: CASH IS KING?
* COMMERCIAL REAL ESTATE
* FEBRUARY 3, 2010
Spurned by Banks, Builders Look Elsewhere
Private Equity Steps Up to Fund Smaller Developers as Traditional Lenders Balk—but the Cash Doesn’t Come Cheap
By JAMES R. HAGERTY
LAS VEGAS—Private-equity firms are stepping into the vacuum left by banks’ flight from lending to small and midsize home builders.
“The banks just are not doing construction loans,” says Robert Mecay, a real-estate developer who is trying to build a luxury condominium complex on the south shore of Lake Tahoe in Zephyr Cove, Nev. So Mr. Mecay and his partners in the Tahoe Beach Club project are seeking $150 million of equity or debt financing from private-equity firms.
The money isn’t cheap. For loans, some private-equity firms were offering interest rates of roughly 15% to 20%. But Mr. Mecay, whose previous projects have relied on bank loans, wants to start the project soon, while construction costs are low as subcontractors and suppliers scrap for scarce business.
“We need to get moving,” Mr. Mecay says. Developer’s Financial Solutions Inc., a financial-advisory firm in Rancho Santa Fe, Calif., is trying to line up financing for Mr. Mecay’s project from wealthy individuals or private-equity funds.
…
“Combo: CASH IS KING?”
You bet it is.
There has never been a worse time to buy…try not to catch yourself a falling knife!
* The Wall Street Journal
* COMMERCIAL REAL ESTATE
* FEBRUARY 3, 2010
Flush REITs Have Loads of Cash, Little to Spend It On
By ANTON TROIANOVSKI
For public real-estate companies, spending money has turned out to be harder than raising it—even as some signs point to a pickup in big property deals.
Real-estate investment trusts sold $24 billion in new stock last year, raising hopes the companies would be able to profit from commercial-property distress by picking up high-quality real estate at bargain prices.
But publicly traded REITs bought only $4.6 billion of property in 2009, a 67% decline from the previous year, according to research firm Real Capital Analytics.
With few deals happening and REIT shares now trading at twice their March lows, some executives regret last year’s money-raising binge.
“Today I’m sitting with $125 million in cash that I can’t find investment for,” Stephen Richter, chief financial officer of Weingarten Realty Investors, said in an interview. “If I would have known the markets are where they are today, I certainly wouldn’t have sold a third of the company.”
…
The New York Times
Irked, Wall St. Hedges Its Bet on Democrats
By DAVID D. KIRKPATRICK
Published: February 7, 2010
WASHINGTON — If the Democratic Party has a stronghold on Wall Street, it is JPMorgan Chase.
Its chief executive, Jamie Dimon, is a friend of President Obama’s from Chicago, a frequent White House guest and a big Democratic donor. Its vice chairman, William M. Daley, a former Clinton administration cabinet official and Obama transition adviser, comes from Chicago’s Democratic dynasty.
But this year Chase’s political action committee is sending the Democrats a pointed message. While it has contributed to some individual Democrats and state organizations, it has rebuffed solicitations from the national Democratic House and Senate campaign committees. Instead, it gave $30,000 to their Republican counterparts.
The shift reflects the hard political edge to the industry’s campaign to thwart Mr. Obama’s proposals for tighter financial regulations.
Just two years after Mr. Obama helped his party pull in record Wall Street contributions — $89 million from the securities and investment business, according to the nonpartisan Center for Responsive Politics — some of his biggest supporters, like Mr. Dimon, have become the industry’s chief lobbyists against his regulatory agenda.
Republicans are rushing to capitalize on what they call Wall Street’s “buyer’s remorse” with the Democrats. And industry executives and lobbyists are warning Democrats that if Mr. Obama keeps attacking Wall Street “fat cats,” they may fight back by withholding their cash.
“If the president doesn’t become a little more balanced and centrist in his approach, then he will likely lose that support,” said Kelly S. King, the chairman and chief executive of BB&T. Mr. King is a board member of the Financial Services Roundtable, which lobbies for the biggest banks, and last month he helped represent the industry at a private dinner at the Treasury Department.
“I understand the public outcry,” he continued. “We have a 17 percent real unemployment rate, people are hurting, and they want to see punishment. But the political rhetoric just incites more animosity and gets people riled up.”
…
“……gets people riled up.”
And we can’t have that, can we? I mean, the economy just would come to a standstill if these guys didn’t churn paper, and cook the books while doing it.
Things were so much better for them when Joe Q. Public was drunk and stupid.
In memory of Oly and Pammy. I loved them both.
Jim Carroll People Who Died lyrics
Teddy sniffing glue he was 12 years old
Fell from the roof on East Two-nine
Cathy was 11 when she pulled the plug
On 26 reds and a bottle of wine
Bobby got leukemia, 14 years old
He looked like 65 when he died
He was a friend of mine
Refrain:
Those are people who died, died
Those are people who died, died
Those are people who died, died
Those are people who died, died
They were all my friends, and they died
G-berg and Georgie let their gimmicks go rotten
So they died of hepatitis in upper Manhattan
Sly in Vietnam took a bullet in the head
Bobby OD’d on Drano on the night that he was wed
They were two more friends of mine
Two more friends that died / I miss ‘em–they died
Repeat Refrain
Mary took a dry dive from a hotel room
Bobby hung himself from a cell in the tombs
Judy jumped in front of a subway train
Eddie got slit in the jugular vein
And Eddie, I miss you more than all the others,
And I salute you brother/ This song is for you my brother
Repeat Refrain
Herbie pushed Tony from the Boys’ Club roof
Tony thought that his rage was just some goof
But Herbie sure gave Tony some bitchen proof
Hey, Herbie said, Tony, can you fly?
But Tony couldn’t fly . . . Tony died
Repeat Refrain:
Brian got busted on a narco rap
He beat the rap by rattin’ on some bikers
He said, hey, I know it’s dangerous,
but it sure beats Riker’s
But the next day he got offed
by the very same bikers
Repeat Refrain; repeat song to Eddie