Bits Bucket For March 9, 2010
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Most Americans still unprepared for retirement
43% say they have less than $10k for retirement
By Chavon Sutton, staff reporter
March 9, 2010: 3:47 AM ET
“NEW YORK (CNNMoney.com) — The percentage of American workers with virtually no retirement savings grew for the third straight year, according to a survey released Tuesday.
The percentage of workers who said they have less than $10,000 in savings grew to 43% in 2010 from 39% in 2009, according to the Employee Benefit Research Institute’s annual Retirement Confidence
Workers who said they had less than $1,000 jumped to 27% from 20% in 2009.
Confidence in ability to save enough for a comfortable retirement hovered at 16% of respondents, the second lowest point in the 20-year history of the survey.”
Social Security is all most will get. And most may not get it if they aren’t “at or over 55″ when the next “reform” happens.
Defaulted Loans May Haunt Seniors
Wall Street journal
Monday, March 8, 2010
A little–noticed law could soon result in smaller Social Security checks for hundreds of thousands of the elderly and disabled who owe the U.S. money from defaulted loans and other debts more than a decade old.
Social Security benefits are off–limits to creditors, such as credit–card companies and banks. But the U.S. can collect debts to federal agencies by “offsetting,” or withholding Social Security and disability payments.
The Treasury currently withholds benefits of 3.1 million Social Security recipients to recover defaulted student–, farm– and small–business loans, unpaid income taxes, amounts veterans owe for health care, and other debts to the government.
Previously, the U.S. hasn’t been able to withhold Social Security payments to recover most debts delinquent for more than ten years.
But a provision in the 2008 Farm Bill lifted the ten–year statute of limitations on the government’s ability to withhold Social Security benefits in collecting debts other than student loans—for which the statute of limitations was lifted in 1997—and income taxes, where the limit remains 10 years.
This means that a person who defaulted on a small–business loan in 1995, for example, and who is receiving Social Security could be notified that his benefits may be reduced each month until the debt, with interest, fees, and penalties, is paid. The Treasury can withhold 15% of the benefit, though it can’t be reduced to below $750. Tax debts have no floor.
And the poor just keep getting poorer!
It’s tough to save when all you’re making is min wage.
Just another facet of our “grasshopper” society, like CC debt, the Federal deficit, and 6 year car loans.
With most cars lasting at least 6 years without major repairs, I don’t see a problem with the loan term, I guess.
One problem with a six-year term would be that the vehicles would depreciate faster than they are paid off resulting in underwater owners which would lead to more bailouts for financers (GMAC) which perpetuates the scam of Ponzi-capitalsism that our nation seems so fond of. Another day, another rip-off.
At some level, I suppose that you’re right. Cars DO last longer than they did 30 years ago, so loans lasting longer isn’t really a problem per se.
The problem is that the longer the loan is, the more interest you pay.
$10,000 loan over 4 years at 5% costs $11053.92 in interest.
$10,000 loan over 6 years at 5% costs $11595.60 in interest.
That’s an extra $540 to extend the payments. Not exactly a king’s ransom, but I’d rather have that money in my pocket.
Agreed, Al.
The problem with a six-year car loan is that it’s a six-year car loan.
Every dollar spent on interest increases the cost of the car (which is depreciating all the while).
The best car loan is none at all: no loan means no interest paid.
the other problem with a six-year car loan is that people go into howmuchamonth mode and buy something they can’t afford, just like housing.
How about 12 year boat loans ??
HA! I guess you’ve never owned a Ford, (or a Toyota…)
Thanks for the link.
Wow.
One thing perhaps misleading - based on the title and some of the wording, I thought at first the data referred to money people had saved that were reaching retirement age. It’s not though - it’s all workers, starting at age 25. Obviously someone just out of school isn’t going to have anything saved up for retirement.
It’d be good if they could put out a set of data also only including people reaching retirement age.
Too many people 5, 10, 15, 20 years out of school don’t have any savings either. Part of the reason is that they need the money to pay off their student loans.
Yes, and validly so. There’s a time period (usually a few years) where someone would go from the red to black, when looking at the sum total of their savings and their debts. Took me about 5 years; and that was back when college was a *lot* cheaper.
(guess looking at my post - I basically just repeated what you said)
With wall street screwing people so often it is no wonder people are broke.
been putting money away in a 401k for 14 years and it hasn’t made me diddly squat.
Agree flg_az. If companies match your contributions to 401K, then savings can build and all the press around the glorious 401K is justified. But from a pure earnings beyond your contribution and company match are often as you say - diddly squat and even loss.
“With wall street screwing people so often it is no wonder people are broke”
so are they victims or not? I’m so confused.
so are they victims or not? I’m so confused.
Analogy would be a rabbit who tries to cross a field in broad daylight, with a hawk sitting in a tree overhead. Yeah, he’s a victim - both of the hawk and of his stupidity. Sometimes, in fact most of the time, it’s not one or the other but just both.
Thank god wage cuts, millions of jobs being sent offshore and double digit inflation outpacing wage increases with slow to no job growth had nothing to do with it.
While it would be good to see a “savings” chart for people reaching retirement age, remember that 401Ks did not become mainstream until late 1980s, and Roth IRAs have been around about 10 years.
Most people reaching retirement age today started working well before these common retirement tools were widely available.
No excuse, of course, for not saving. But in all honestry, when they started working they were told the company would provide a pension, so they did not have to save. Then when things changed, they were already set in their spending patters (mortgage size, etc). To suddenly have to contribute 10% of your own salary to retirement when the company did this for you previously seemed as foreign as working on Mars (not to mention a large pay cut).
In short, they did not have a ’save for your own retirement’ concept the first decade of their work life, then a cost structure designed on not having to save, and then, less than a full working career to build up any savings. And it’s not like they (or most of us) made much money on our retirement funds in the past decade anyway.
Yes, you’re right of course. Now that you mention it though - I had assumed that the study included pension plans - I see now that it doesn’t. As such, IMO the data is quite meaningless then. My father for instance lives quite comfortably with not a lot of savings - but it’s because his house is paid off (primary homes are not included), and he gets a good pension from where he worked for 40 years.
So IMO - now that I look deeper - this article is stupid.
Yeah it’s dumb that people don’t have over $10k saved. But that has nothing to do with retirement. People should have that much saved just as rainy-day (e.g. layoffs, medical problems, etc.) liquid funds.
Engineers in my generation generally changed jobs every three to five years and moved to the new job. You’d just be caught up from the financial shock when it was time to move again.
Savings? Isn’t that where you try to work down the credit card balances?
I started my career in 1971, the first 2 companies I worked for had a DB plan, both were “10 year cliff vesting” plans where you had to work a full 10 years to be vested in the company’s contribution. Those plans are not legal any more. I lasted 1 year at the first company, but I worked at the second for 10 years and one month, so I am vested in that plan. I will receive about 180/month if I retire at 65. Large whoop.
Since then I have not worked for any company that had a DB plan, but I have worked for small privately held companies. Most of the companies have had modest DC 401-K plans and have made a modest match 2% to 5% of income, so by and large preparing for retirement has been up to me.
From about 1982 to 1999 (with the exception of 1987 and 1997) decent returns could be had in the stock market. However the last 12 years have been a real bust. I have been fortunate to have had way better than average earnings and have lived somewhat below my means (been in the same house for 23 years, paid off in year 13), only had two kids, sent the kids to state college, kept the same wife, avoided the big car/second house syndrome, etc. so I have been able to prepare fairly well for retirement. It won’t be lavish (the last 12 years killed the lavish notion as it did retiring at 58 as originally planned), but I won’t be eating cat food either.
But, I will say that for the average person without a DB or high match DC pension plan, earning the median income, with an average household size, I belive that building a sizable retirement nest egg would be virtually impossible. There are just too many calls on the money.
Lots of people that had sizable DB plans now find themselves wards of the PBGC, receiving about 40% or less of their expected pensions, so there are no guarantees.
Pension plans typically payout way more than employees contributed - even considering interest over time. Plus pension plans have access to investments at higher yeilds than public. This idea that today’s worker can save on their own to emulate a pension , or replace power of pension with 401k is ridiculous.
You know guys I had a sitdown with the wife. Said that now at 40 it is totally unacceptable to end the year in the same shape we started the year financially.
So, I am maxing out a Roth and 401K before anything else. At the end of the summer will have hit the limit I can put in there. Cutting expenses everywhere so we will not have any debt. Also putting aside a contribution for the wife (5K per year).
I have a vested pension plan but it is small with some associated cash value. Not counting on that at all.
Started putting away vacation savings and Chrismas savings.
As a result of all this… if I am fortunate… will be able to retire in semi-poverty at 68. OK for me. I’m fairly bohemian/spartan. My activites are hiking and sailing.
Get a cheap used boat and or hiking is nearly free. Just need bare enough money to supplement on food I don’t catch. Worry about the wife and baby though. Like to get her through school.
The other plan is to buy a house in a cheap location to relocate the family then move on to contractual work. LA is still too insane to deal with and quality of life has been declining since I got here.
It is quite painful. I will count on medicare and SS for nothing as I expect that will be there value.
My only hope is that mom leaves me her house back in Jersey. That remains higly unlikely though. Expect she will make a DUMB MOVE and sell it and give the money to a long term care facility. I say DUMB MOVE because I expect the long term care facilities to also default on their contracts as well.
So… basically expect to drift in and out of employment… like most engineers. 3-5 years that Skye pointed out seems correct. Maybe start a small mom n pop engineering house. Market is volatile for engineering but the money averages out as OK. Not like hitting a hot construction or finance market though. You guys know what it’s like? You get into a company and get products ready for market. Then the company doesn’t need as much engineering. So, poof, you are a bad guy and out on your ass. I’ve become more realistic and when they aren’t trying for new products, see the writing on the wall and hit the streets.
Every once in an odd while you hit on some stock options for a company that sticks. Just have to put that away.
Now, I’ve been in the same place for a while. Half a blip from being a govt employee. But I know the big wave of cutbacks is brewing and am trying to move a couple years before hand.
“Everybody thinks they’re too young to think about it, until suddenly they’re too old to do anything about it.”
–That’s a nice quote. Keep in mind that 10k is NOTHING. At 67, you can spend 10k to buy an annuity that will give you a gauranteed income of…$68 per month for the rest of your life. that won’t even keep you in cat food.
“At 67, you can spend 10k to buy an annuity that will give you a gauranteed income of…$68 per month for the rest of your life. that won’t even keep you in cat food.”
Maybe Little Friskies, but not Fancy Feast.
Back when my employer was still giving a 401K match, I tried repeatedly to get all the 20 somethings in our department to sign up.
Only one did.
They think they “can’t afford it”, even though they still buy yuppie coffee and no one brown-bags lunch, etc.
Wow.
Did you show them graphs? That always seems to make the big impact to me. A visual comparison of your retirement quality of life if you start saving now vs. if you don’t really hits home.
Yep, and the concept that if you save in your 20’s and stop, compound interest could still leave you ahead of someone who starts much later in life.
One who “can’t afford it” is a “sneaker head”, has a closet full of expensive shoes. (And this is a guy.)
Oh, and to indulge in a bit of stereotyping, the one who signed up was a girl from the midwest, the rest are NYC region natives…
Theorize the attitude it took for her to relocate to a new city on her own, and a dash of midwestern sensibility, contributes to her making better decisions.
Well if she came from the rustbelt, she might have seen the sort of bad times that make one want to save for an uncertain future. Certainly my mother who grew up in Depression-era West Virginia is a believer in saving and living within one’s means. Some people have more income and some people have less. But you can almost always find somebody ELSE who IS living within your means. I just don’t understand how people raise their perceived NEEDS high enough that they have no margin for savings or emergencies.
Nobody can reasonably be expected to be prepared for a crisis that forces them to spend several times their annual income. But nobody should be living so close to the margins that an unexpected expense of 2% of their gross income throws them into debt.
“…But nobody should be living so close to the margins that an unexpected expense of 2% of their gross income throws them into debt….”
I agree with that. It’s just shame that millions don’t have a choice.
(those that do have a choice, are idiots)
Exactly -
I signed up and started contributing at 24, not thinking it was going to get me all that far that fast. Once I saw the money pile up, it became addictive. Now, I am one of the most frugal people, because I want to have as much cash as possible for my investment accounts.
Saving is fun! (I’m 31, now. )
It depends on the employer. Good employers, who pay lots of money, tend to have better retirement programs.
In 6 months one of my 401ks was the equiv of 3 years working for another company (contributing maximum to match.)
Man, I can’t imagine not signing up for the free money! I viewed it like part of my salary and would be damned if I didn’t take advantage of it. I’m very thankful our match hasn’t ended (yet).
“Back when my employer was still giving a 401K match.”
I get one percent. This is what was offered to the generations starting with the second half of the baby boom instead of pensions, but once the pensions were long gone the defined contributions followed.
Younger generations are not getting health insurance.
At this point, there is nothing left to take but paychecks. Can you say interships!
Not to mention $7.00/pack smokes.
My daughter just went to work for a national firm. They make a 10% contribution, plus another 7% match. 24% of gross if she makes her contribution. Now that will add up.
Just out curiosity, for how long will they contribute?
Many companies have cutoff dates of some kind whether by amount or years and then contribute no more.
If her company doesn’t have a cutoff, she should consider herself VERY lucky. And that 10% is very generous these days.
And remember, to keep all or most of the employers contribution you must be vested. How many people will have the same job long enough to take away 100% of the match?
Next day post-hoc remark:
My observation is probably 60-70% of people do, at least in my field (communications/engineering).
I have for all my jobs (3 now).
Sounds like just another pathetic attempt of the Banksters to get the masses to join their casino.
More people saving for retirement (401k) is basically more money for Banksters/Brokers/FinancialPlanners.
Thank you! That was one of my impressions too. C’mon ‘Murika step up and send some money to Wall St. - they would never steer you wrong, they want your golden years to be comfortable.
My other thought on this was that we’ve seen many stories where people are raiding their retirement funds to feed their gators. So even those that believe in the eternal promise of Wall Street are submarining their own plans!
According to the article, the survey was conducted among workers age 25 and older. My wife and I weren’t even married at that age and neither of us had ANY savings. I’d love to know what the number was for those age 50 and older. who can see retirement looming.
The article does not say if that 43% is composed mostly of people between age 22 and 30.
When I was 29 I had $1,000 in savings. Twenty-one years later I crossed into the seven figure mark.
I do think there is a shockingly high amount of people older than 50 who have less than $100,000.
Most people flunked personal finance 101, which never promoted real estate as a retirement savings plan, yet many people think somehow that their house is their nest egg. It’s all a pyramid. Who will they sell their houses to when they are ready to retire? There is an oversupply of boomers and undersupply of Gen-Y people.
“Who will they sell their houses to when they are ready to retire?”
I know who they won’t sell them to…
They’ll sell them, they just won’t like the price.
“When I was 29 I had $1,000 in savings. Twenty-one years later I crossed into the seven figure mark.”
Shhhh! You don’t want the government to find out, do you?
Well the nice thing about a paid off house as a form of retirement savings is that you generally don’t outlive it. The idea isn’t that you sell it or tap that equity, just that you live their rent free for the rest of your life.
http://assets.opencrs.com/rpts/RL30922_20090408.pdf
Everything you would ever want to know about age stratified savings and retirement accounts, as of 2007.
The mean retirement accounts for 55 to 64 year olds in 2007 was $270,000. Assuming most was in equities, that is probaby around 75% of that amount now. Not much money.
The article expressly states that it “excludes the value of primary homes and defined-benefit pension plans (eg 401ks).” Thus, the headline is very misleading. If you are conservative and paid off your house and contributed the max to your 401k plan but did nothing else, you would be within that 43%, but could be extremely well off in retirement. Excluding retirments plans and paid off residences, people have nothing saved for retirement. … I think way too many ppl live beyond their means but that logic just doesn’t fly and fails the BS meter.
“retirments” = “retirement”
I should add that I’m not implying that people save enough for retirement. I am just saying that without adjusting for home equity or lack thereof, and retirement plans, the study is worthless. I don’t even think they adjusted for overall debt. What is in the hell does retirement savings mean without looking at one’s debt levels. Clearly if debt is higher than savings you really have no savings even if you a $1,000,000 in a bank account earmarked for retirement. I would love to see a study that was done by someone with a financial background putting together some useful numbers. And no I’m not talking about one of those “economists” cited in the articles. I’m talking about someone bright and truthful, without a hidden agenda for which the intent is to mislead others.
We’re going to agree that more information would be better. But this is what they have. And Ol’bubba is right, 401(k) are NOT defined benefit plans. But they certainly DO impact how much savings you want in retirement. In a larger sense, it doesn’t help us AS A COUNTRY to save more for retirement, even though it helps us alot as individuals. The 401(k) balances, pension plan funds, and the SS Trust funds are not invested in warehouses of Depends, Caprice Classics, golf clubs, nursing home beds, geriatric nurses and cardiac stents. Almost all of the future consumption of future retirees will have to be produced by future (then contemporary) workers. Savings just don’t do anything to change the rise in the retiree/worker ratio as the Boomer cohort retires.
Only a small proportion of all that money that we’ve collectively sent to Wall Street and Washington to “save” for our retirements was spent on the sorts of productivity improvements that make it easier for fewer workers to meet the demands of more retirees. Most of it was either spent on current transfer payments (SS trust fund) or bidding up the price of financial assets (401(k)s and pension plans). Retirement savings to some extant constitute a “red queen race,” so those of us who DO save should be happy that the fact that other don’t will mean that we do proprotionately better. Retirement is going to be “graded on a curve,” and we would do LESS well if everybody else was saving.
Good post. Thank you.
That has to be some of the most convoluted rationalizing I’ve seen in a long time.
I’m actually impressed. I would like rebut point by point, but none it makes any sense.
“Retirement is going to be “graded on a curve,” and we would do LESS well if everybody else was saving.”
Oh it will be graded on a curve all right… a mountain side hairpin curve… with no guardrails or warning signs.
Someone correct me if I’m wrong, but my understanding is that a 401k is not a defined-benefit pension plan. A 401k is largely a self-funded retirement savings vehicle, and in some instances there’s a partial match paid in by the employer.
As I understand it, a defined benefit pension plan is just that: a plan that defines how much it will pay based on factors such as years of service.
401k is not a defined-benefit pension plan.
no its a defined savings plan
The article expressly states that it “excludes the value of primary homes and defined-benefit pension plans (eg 401ks).”
No - it does include 401k’s presumably (due to the later remark on them). Your quote isn’t right - the article only excludes pensions, not 401k, since 401k isn’t “defined benefit”.
In other words - the author was lazy, since he/she (what gender is “Chavon”? Not sure I’ve heard that name before) didn’t even attempt to account for pensions, which is the lion’s share of a very high portion of people’s retirement.
I stand corrected.
Natalie, jut for clarification, a 401k isn’t a defined benefit pension plan. Defined benefit is where you get defined amount of money (usually a percentage of salary, hopefully adjusted for inflation.)
401ks I think are properly definied as a questionable benefit plan.
“defined-benefit pension plans (eg 401ks)”
Nothing gets by you ppl. Thanks.
Hey, maybe I should come along and say the same thing a couple of other people already said.
Note to self, read further, then post.
Well in my defense, it took me so long to write my long, rambling, increasingly off-topic post that somebody else said it after I started writing, but before well before i finished. Wait, I was trying to defend myself here…..
401-K’s are Defined Contribution plans, generally. My guess is they are included.
DB plans pay a set amount/month so probably could not be valued for inclusion.
Meanwhile, public pension funds are doubling down on their gambling losses.
The New York Times
Public Pension Funds Are Adding Risk to Raise Returns
By MARY WILLIAMS WALSH
Published: March 8, 2010
States and companies have started investing very differently when it comes to the billions of dollars they are safeguarding for workers’ retirement.
Jerry W. Hoefer for The New York Times
Frederick E. Rowe, a Dallas investor and the former chairman of the Texas Pension Review Board, said states were looking at riskier investments in an effort to meet pension obligations.
Trent May, chief of Wyoming’s pension fund, said states were “moving away from the perceived safety and liquidity of the investment-grade market.”
Companies are quietly and gradually moving their pension funds out of stocks. They want to reduce their investment risk and are buying more long-term bonds.
But states and other bodies of government are seeking higher returns for their pension funds, to make up for ground lost in the last couple of years and to pay all the benefits promised to present and future retirees. Higher returns come with more risk.
“In effect, they’re going to Las Vegas,” said Frederick E. Rowe, a Dallas investor and the former chairman of the Texas Pension Review Board, which oversees public plans in that state. “Double up to catch up.”
…
There was an article yesterday about the FDIC trying to get pension funds to buy up banks that had been closed.
Oh, that’s nice.
Grasping at straws? IMO, a symptom of possible total breakdown to come. Don’t most breakdowns (war losses, economic failures, etc.) come after a period of higher risk-taking?
An analogy would be hockey. Oftentimes a team that’s down by one will pull their goalie in order to try to gain a 6:5 advantage and score a goal to tie the game before time runs out. However this leaves their own goal totally undefended. So more often than not they end up losing by 2 instead of tying the game. It’s worth it in hockey, since the scoring is so seldom and the outcome of a 1-goal loss is the same as a 2-goal loss.
“Frederick E. Rowe, a Dallas investor and the former chairman of the Texas Pension Review Board, said states were looking at riskier investments in an effort to meet pension obligations.”
This sounds a lot like the gambler who is chasing his losses. Nothing like going all in on a 15 team parlay at 15:1. I smell busted pensions.
I smell busted pensions.
Yep.
PBGC will be big bailout news in our not-too-distant future, IMO. There have been several recent articles of them losing big money. It didn’t help that they themselves went risky with their investing of the trust fund - in equities right before the crash no less.
That’s 1500:1, not 15:1.
Insane.
It’s not really a problem! We can just tax “the rich” to pay for these people.
Also, we can means test for Social Security! Anyone who saved money for retirement should be excluded, so they’re made equal to those people who saved nothing. Isn’t that what our founding father’s wanted with “all Men are created equal?”
Is that you Obama? I have a few things I want to talk to you about. Give me a call on my cell.
That looks like the textbook definition of ‘moral hazard’.
You do know that in any given year, nearly half of corporations both foreign doing business in this country and domestic pay no income tax?
Yes, you can google it.
What is this, how you say, “retirement” of which you speak?
It’s what you do if you hate your line of work.
I still enjoy engineering at this point.
You do, for the most part, enjoy working on the planes?
At some point my mind and body will probably totally break down and then I will stop working.
Or that fatal heart attack will happen.
Retirement more and more will be when the Unemployment Benefits run out. Maybe you’ve reached 62 by then, maybe not. Retirement will more and more be when the last company you worked for fails or you get outsourced, downsized or otherwise put aside. The traditional notion of a gold watch and a cake on your 65th birthday just ain’t reality anymore.
Plan for it.
43% say they have less than $10k for retirement
I’m really starting to wonder where this will lead in light of our government/corporation’s recent behavior, gutting of pensions, stock market crashes, higher cost of living, lost jobs and the bail-out repercussions.
I’m thinking of the saying: “When you owe the bank a million dollars it’s your problem. When you owe the bank a billion dollars, it’s the bank’s problem.”
When 5% of retirees are broke and hungry it’s their problem. When 70% of retirees are broke, hungry and angry, (and their kids have BS jobs) who’s problem is it?
This is why breaking the social contract between business, government and the people is a threat to the country’s long-term structure and stability.
Rio well said . Your points are why there has to be a correct balance in the distribution of the wealth .
This after the fact structural change to the Global concepts has created the greatest destabilization for the future you can ever
imagine here in America .Whats crazy is Corporations and Monopolies like the Health care industry think that they can just keep raising prices and government thinks it can just keep raising taxes ,but the well will be dry . Government hasn’t even considered that they are giving up tax base when Companies outsource and local manufacturing is lost . Than you hear everybody fighting about who should be taxed more to make up for it .
Also, if Boomers can’t retire and its put off for another 5 years or so ,than the younger people are deprived of those jobs for a longer period of time .
This government of ours should of thought twice about allowing all these changes to the structures that were set up for many years .
They are probably all happier than the Lemmings blindly sending their moneys to Wall Street every paycheck.
While I would agree with others that breaking the numbers out by demographics would be much more meaningful (and interesting), what I took from the story was that the trend is getting worse.
In other words, assuming the poll done previously was the same as the current one, with pension plans becoming more rare, you would think people would be saving at least as much as before.
I also took it as confirmation that, given the studies are only 1 year apart, this recession is taking a heavy toll on monies that were earmarked for later in life…not to serve as an unemployment check.
It’s tough to save when all you’re making is min wage and job growth is non-existent.
Can’t make your mortgage? Get an emergency loan
NEW YORK (CNNMoney.com) — The jobless may not be getting much help from President Obama’s loan modification program, but those in Pennsylvania have another place to turn.
The Pennsylvania Housing Finance Agency offers the jobless and those suffering financial hardship loans of up to $60,000 for as long as three years to cover their monthly payments or take care of their arrears. Created in 1983, the program boasts an 80% success rate in preventing foreclosures.
“If you allow people some time to find a job, they can keep their home, which saves their family, their neighborhood and their communities,” said Brian Hudson, the agency’s executive director.
http://money.cnn.com/2010/03/08/news/economy/mortgage_help_for_unemployed/index.htm
Created in 1983, the program boasts an 80% success rate in preventing foreclosures. For how long? Is this like the 1 year cancer survival rate?
And even if those numbers are long-term results, something tells me that their losses during this cycle will be “higher than expected”. There is a significant difference when the recipient has significant negative equity that does not resolve itself within a reasonable amount of time.
In a normal market there really is a point to this sort of thing. There certainly ARE people who have suffered a one time financial hardship who could use some sort of financing to get them over the rough patch. But that’s not the problem that the RE market is suffering from here. These days, banks are so slow to foreclose, and willing to make modifications that DON’T involve reducing principal, that there is LESS demand for this sort of emergency loan. We’re close to a “permanant emergency,” here.
So you’re right, past performance IS no guarantee of future performance.
The Pennsylvania Housing Finance Agency offers the jobless and those suffering financial hardship loans of up to $60,000 for as long as three years to cover their monthly payments or take care of their arrears. Created in 1983, the program boasts an 80% success rate in preventing foreclosures.
Notice they don’t say the percentage of these loans that are paid back in full…
So the solution to your unmanageable debt is MORE debt?
Works for Greece.
Newspeak
Its like a homeless beggar telling you he is going to “spend his way out” of his situation. Retards.
Also it’s different now in that people are being downgraded on income in a lot of cases and not able to duplicate their lost income.
Add inflation to this whole picture and people will not be able to catch up with loan aid like this .
I am compelled to set the record straight from SV Guy’s quiz yesterday: “the jig is up… and GONE!” was from History of the World Part I. Gregory Hines.
Mental health break: http://www.youtube.com/watch?v=vOpM46YSulA
Chili,
I do vaguely remember that scene. The movie
I was referencing was ‘Blazing Saddles’. Clevon
Little (the black sheriff) said those immortal lines.
I said it couldn’t be made today because of it’s political
incorrectness. Everybody gets slammed in that movie.
Iceland Rejects Icesave Depositors Bill in Referendum (Update2)
March 7 (Bloomberg) — Icelanders rejected by a massive majority a bill that would saddle each citizen with $16,400 of debt in protest at U.K. and Dutch demands that they cover losses triggered by the failure of a private bank.
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=awUQtLSVh0sQ
If Iceland gets to vote no and doesn’t have to pay, why don’t I get to vote no? How come I have to pay?
It isn’t fair. I don’t want to pay. I smell another round of emails to my Congressman, Senators, and the POTUS.
I guess I just hate being a fool for some criminal on WS.
Roidy
P.S. I’m gonna get tased sooner or later.
3 hurrays for Iceland!
This is the first time citizens stood up against their bankster overlords. 93% don’t want to pay their $16,400 tribute to their masters. Get out the pitch forks and ready the Guillotine!
I wish debt slaves here would show the same interest in financial matters they devote to professional sports, American idol, abortion, gay rights, flag burning and other such nonsense.
Umm….because the “emergency” part of the bailout was handled by other countries, not Iceland. And by the time Iceland politicians agreed to pay back GB and the Netherlands for covering items that didn’t get covered by Iceland’s bank depositor insurance program, the immediate crisis had passed and voters managed to express enough rage that their president didn’t sign the bill passed by the legislature. He then arranged a referendum.
Our TARP was organizaed by our own Treas. Secretary at the time, passed by a scared US Congress and signed by Bush. Different process, different results.
Not all that hard to understand, if you actually want to understand, as opposed to just wanting to rant a bit.
Of course Iceland’s president’s refusal to sign the bill helped matters along considerably. Still, the people of Iceland collected enough signatures to set the process in motion. Something I doubt would happen here.
I’m not sure
What was the quote about calls regarding TARP
50% no, 50% hell no.
polly,
Ok, I certainly see that the “bailout’ was engineered by Netherlands and GD. Fine. Still, the Iceland voters forced a referendum. They voted “no”.
Now, we had a referendum, also. It was the election of 2008. We voted “No”, too.
We still have to pay in spite of our “no” vote. I voted for change and what I got was the same old coddling of WS. It should be remembered that Greenspan’s Fed did much the same thing in 2001 when the Fed lowered rates to another level of dirt cheap. That action didn’t get us anywhere.
So, I really don’t want to do bailouts to the people who caused this. Iceland isn’t.
BTW, the bailouts were supposed to work and “save the system.” I really don’t see how it has. The system is saved, but it is being destroyed in the process.
Roidy
Sorry, Roidy. Voting for Obama wasn’t a vote against TARP.
Electing Ron Paul would have been a vote against TARP, though even he couldn’t have gotten rid of the law by himself. Since it was passed with almost no restrictions on the spending, he might have been able to just refuse to spend the rest of the money.
There is a big difference between kicking out the bums you have and a clear cut referendum. I don’t think the US has any structure in place to have a nationwide referendum, though you certainly could approximate it by having 50 state wide referenda. But that would only send a message to the congress critters - state referenda can be binding on state politicians/legal systems, but I’m not aware of any state where they can be binding on the federal congressional delegations.
Who knows? Problem is, that like many successful politicians, Obama was elected because he managed to remain a cypher upon whom people could project what THEY wanted upon. I don’t doubt that some people DID think that a vote for him was a vote against the Wall Street fat cats who busy turning TARP money into bonuses.
“Sorry, Roidy. Voting for Obama wasn’t a vote against TARP. ”
Now you tell me! LOL.
I thought we were going to get some real change. Ok, I should have voted Ron. Still, I don’t really like some of Ron’s positions.
Now, the Greek PM is sitting in with the POTUS this morning. Wonder what they are talking about? Hmmm.
COULD IT BE BAILOUTS BY THE US TAXPAYER? AGAIN!
(Que the echo effects from the Church Lady on SNL at this point.) I would be that the Fed will be more than glad to help the Greeks and all of the rest.
I’m getting increasingly unhappy with this. I wonder when Iceland is going to show or call? (Like I have a responsibility for this! )
It’s been a year. Gotta love the market. All is well.
Roidy
Why should citizens of Iceland be responsible for making private investors in a private bank whole on their gambling losses? Whoever invested in a private bank that goes bust should swallow the lump and enjoy it. Don’t try to cram your losses down the throats of others who were not in on the scheme, as that would amount to socializing the losses, which is not part of the capitalistic system of economic governance. Lump it and love it, investors!
Let’s call the Iceland version of the FDIC the IDIC.
Non-citizens of Iceland with deposits in Icelandic banks are not covered by the IDIC.
How difficult is that to understand?
So GB and citizens of other countries (mostly EU) had deposits go “poof”. In their outrage, their home countries covered the loss (proof idiots abound in governments around the world) and then went after Iceland for the loss.
And Iceland voted - 93% for - to follow their own banking laws.
Good for them.
“How difficult is that to understand?”
Apparently that was extremely difficult for citizens of GB and other foreign countries which invested in Icelandic banks to understand.
….wow, and to think…*shivers*
10 to 1 they will eventually push something past the will of the people. The bankers know that it’s hard to mobilize that much anger again and again, so they will just put some lipstick on this pig and make another run until the tax payers of Iceland are on the hook for the bankers losses.
Or perhaps punish them for daring to say no.
I believe that not being allowed to join the EMU is what is going to be held over their heads. Not something that is likely to be much of a hammer for a good long while.
First of all, Iceland isn’t going to qualify even without the fake debt included in their total until they rebuild their economy on sustainable grounds. Second, joining the EMU isn’t going to look like such a great reward for quite a while, I think. I’d want to wait until Spain and the rest of the PIIGS are all fixed up, if I were them.
And how sustainable could their debts EVER be? They have volcanos and and cod. You can’t really export geothermal energy and the cod fisheries have been declining for centuries.
There has got to be something that you can make that can be made much, much more cheaply when you have nearly unlimited geothermal energy at your beck and call. I have no idea what it it, but there must be something. I mean something other than ice cubes whose recipe is, of course, water plus electricity.
Doesn’t Japan create tons of stuff - cars, electronics, etc., without using much of their own natural resources? Were I Iceland, I’d follow that model. Perhaps not Japan’s financial model of course, but at least the strategy of using brains as your primary resource.
That and tourism. Iceland’s a neat place, and it’s in a prime location for tourism - much moreso than say New Zealand, or even most of the Caribbean. Granted the weather’s not fantastic in Iceland, but it’s not that bad, and the scenery is awesome. Seems like it’d be huge appeal to adventure tourism (which is why I think they have a very young population there actually).
There’s only ~300,000 people there, so it shouldn’t take much to support them. Catch some cod, fleece some tourists, send Bjork on tour, and they’re back in biz…their geothermal energy is nearly free…might as well stiff the euros- the EMU has flown. They’ll probably have it better than most. Might be a good place to ride out the meltdown.
Can they pay off the investors in ice cubes?
Exactly - I’m all for clowns making crazy loans to each other, and going into all the debt they want. It’s their free will. They’re consenting adults. If they’re right about the situation, they stand to make good improvements to their quality of life, and I get “left behind” with my meager savings and interest rates.
But the infuriating thing is, when they’re wrong - as they have been - the politicians are going to pick my pockets to pay off their lenders anyway! That’s the part of the equation that really frosts my cookies.
Ga. revenues continue to plunge for 15th month
- Associated Press
Georgia’s tax collections tumbled for the 15th straight month, setting the stage for yet more deep cuts to the state’s already battered budget.
State money managers reported on Monday that revenues slumped 10 percent from the same month the year before. For the fiscal year that ends June 30, tax collections are lagging 12.7 percent behind the year before, a drop of $1.3 billion.
Legislators — who spent two weeks in budget hearings trying to trim every last bit of fat from state spending — have been anxiously awaiting the new revenue report, hoping the numbers might provide a glimmer of hope. Instead, nearly every major category of tax collections declined.
“There’s just no way to put a pretty face on it,” Lt. Gov. Casey Cagle said in an interview with The Associated Press.
Sales tax collections were off by 12 percent. Corporate income taxes dropped 26 percent and personal income taxes declined 18 percent. One bright spot: Income tax collections were up slightly from February 2009. But a surge in tax refunds going out the door knocked that small gain back into the red, officials said.
We, Georgians, are 48th in education and it shows. Math skills elude our elected officials. Two quick examples -
Income tax - Our present administration has exempted anyone over 62 years of age from paying state income tax unless their federal agi exceeds $ 42k indiv, and $ 84k mfj. Surprisingly now that the economy has cooled, tax revenues no longer cover expenditures.
Property tax - An amendment was passed under the guise of “go green” which dramatically reduced taxes on timber land of huge corporations/family llp’s/foreign entities. Passed by 2 to 1 measure but now is the time to pay the piper, the lost revenues at local revenue have to be subsidized by the state. Shockingly, this further depletes state funds as no offsetting revenue was enacted.
Welcome to GA, watch Miss, we want to be 50th.
“We, Georgians, are 48th in education and it shows. Math skills elude our elected officials”.
Then we South Carolinian’s must rank 49th. Decade after decade our local politicians, tell us all they need to “fix” every thing is Mo Money. Our city council has spent more than it has taken in for the past 7 consecutive years, and somehow think that’s okay.
We are sending a long term councilman to federal prison soon, he forgot that he needed to pay taxes since 2004. The damage these self serving POS can do is very hard to undo.
And good ole boys wonder why the south never rose again.
Sales tax collections were off by 12 percent.
Similar stories are told around the country. Yet we are also told that retail sales are “up”.
Yeah, those are two dots the MSM just can’t seem to connect.
Most certainly a lot of people are doing everything possible to reduce or avoid local sales taxes, but that alone cannot account for such a divergence because somewhere another taxing body is benefitting from another’s lost revenue.
Do you know if restaurant meals are included in the retail sales figures? Or in the sales tax figures (meal tax could be in different line item)?
‘Cause most states don’t tax regular food (junk food may be taxed). So if food is included in retail sales and not taxed while restaurant meals are not included in retail sales figures at all, then simply eating out less and in more combined with less spending in other areas could up retail sales and lower sales tax collected.
So if food is included in retail sales and not taxed while restaurant meals are not included in retail sales figures at all, then simply eating out less and in more combined with less spending in other areas could up retail sales and lower sales tax collected.
Good point polly!
I’ll have to poke around and see how that calculation is made.
Really I suspect that the problem is as simple as people can’t use a HELOC to spend more than they make anymore. Until they can figure out a way to slap a sales tax on debt repayment, taxes will be down.
Anybody in position to talk about precedent of Fed bailing out states?
You mean directly, as in Fed purchase of state bonds, or even just direct deposits into state accounts?
They’re already bailing them out indirectly, in the form of the Fed buying U.S. treasuries, and the U.S. giving money to the states as part of the stimulus package.
http://www.guardian.co.uk/commentisfree/cifamerica/2010/mar/08/financial-crisis-subprimecrisis
“Politicians and the media continue to refer to the economic downturn as being the result of a financial crisis. This is wrong. We have 15 million people out of work because the housing bubble that drove the economy since the last recession finally burst. The financial crisis may have been good entertainment for those who like to see huge banks collapse, but it was a sidebar. The real story was the rise and demise of the housing bubble.”
“Those who claim that the real problem was the financial system and its faulty regulation can be disproved with a single word: Spain. Spain is noteworthy because it now has an unemployment rate of more than 19%, the highest rate in any of the wealthy countries. Spain did not have a financial crisis. In fact, its well-regulated financial system is often held up as model for the United States.”
“Spain did have a horrific housing bubble. As a result, the share of construction in the economy rose from less than 8% of GDP at the end of the 90s to 12.3% in 2007. By comparison, it is typically less than 6% of GDP in non-bubble years in the United States. This rapid rate of construction led to enormous overbuilding, which meant that a collapse was inevitable with construction falling to far below normal levels.”
Interesting to see the housing bubble itself referred to as “horrific”, not the inevitable collapse that followed.
“Note that just about all analysts agree, Spain’s financial system was well regulated and it had none of the loony loans and outright corruption that pervades Wall Street and the US financial system. Yet, it is suffering from this economic downturn even more than the United States.”
“The economy’s real problem is simply the loss of demand created by collapse of the bubble. Throwing even more money at the banks is a way to ensure that they don’t suffer from the consequence of their own greed and stupidity. It is not a way to restore the economy to health.”
But Spain’s real estate was being ’snapped up’ by investors from other countries. I’m guessing a lot of the easy money came from outside Spain.
And who, exactly was BUYING the bonds created from Spanish mortgages? We’ve seen Norwegian towns having problems because they bought bonds that were ultimately based on subprime US mortgages. Who ultimately bankrolled the loans on homes bought by Northos who wanted to retire in the sun?
Or were they bought for cash with money that the retirees got by selling their London homes? Ultimately I’m guessing that the money that bid up Spanish house prices came from the City. (London equivalant of Wall Street)
Sounds like a good guess.
Oh spain didn’t have securitization, it didn’t see artificially low interest rates, there was no mortgage fraud.
Again the bankers in this country want to shift the blame. Securitization and the off loading of risk to pensions gse’s retired persons, other states, churches etc combined with massive rewards to CEO’s who gambled with the life of their company caused the whole thing. If companies were forced to keep skin in the game and CEO compensation was based on the long term performance of this activity we would not be where we are today.
Having put some thought into it, securitization in itself isn’t necessarily bad. Proper ratings on securitized garbage would have allowed proper pricing, and slowed the flow enough to raise concerns and a cause a closer look at the who housing bubble situation.
Well securitization does allow more and more layers between borrower and the ultimate lender. And the more layers that you have, the crappier underwriting can get, and the more fraud can be hidden. People keep adding poo until the sausage stinks.
Detroit wants to shrink itself by 25% via bulldozers.
http://news.yahoo.com/s/ap/20100308/ap_on_bi_ge/us_downsizing_detroit
Somebody ought to start and architectural salvage business that goes ahead of the bulldozers.
There are entities that do that kind of salvage. I’ve been in warehouses full of architectural components such as fancy staircases, framed doors and windows, columns, chandeliers, escutcheons, etc. in both eastern PA and by the airport in Sarasota. But I suspect the demand for such stuff is minimal even in Gilded Age periods, so most of Detroit’s good stuff will become wood pulp or landfill.
In Queens NY we have a great non-profit called “build it green” they get some really amazing stuff donated - from paint to whole staircases taken from old town houses.
The most entertaining thing is they sometimes get parts of sets from TV shows and movies from the local studios.
Well its about time… We can justify old dilapidated abandoned building….but new condozes?
Oh wait they have been sealed up in the steamy FL swamps and are just full of that icky black mold…Maybe we can sell them for $1 to new home buyers and they get the $8k tax credit to spend as they please. And they cant sue for health related problems..
From a sidebar to that article (as it appears in today’s SD U-T):
Detroit Population
Year Pop
1950 1,849,568
1990 1,027,974 (-821,594 over 40 years)
2005 890,963 (-137,011 over 5 years)
Those numbers suggest Detroit is in a demographic death spiral.
My guess is that the figures you posted were for the city of Detroit.
Did they show similar figures for the Detroit metro area? Those figures may not be as bad as the ones for Detroit proper.
Yes, but Detroit propper IS the problem. The tax base has shrunk, but they have the same number of miles of roads to maintain. Some expenses are proportional to population, and some to square miles. One or two occupied dwellings per block is very inefficient, but FORCING people out of their homes so that you can reduce the number of square miles that your servicing is politically VERY difficult. It’s kind of like a slow motion Katrina.
I’d love to be able to revitalize a place like Detroit. Some beautiful old homes from the 20’s bubble with a lot of interesting art deco building. Good water front area.
Lots and lots of potential.
The problem? I’m white.
Racist black people who will tax you to death while literally trying to kill you. The hostility in places like Newark, Camden NJ or Detroit or Atlanta is amazing.
That and amazingly high taxes.
Place just commited economic suicide on so many levels. Primary example of government intervention as a heavily regulated area.
So. Best thing to do is let natures take it’s course and wait for enough of the population to leave. Probably to some place like California, where stupid liberals will give them more handouts. Freeloading mofo’s.
Then swoop in on the remaining bargins.
Not wanting to be racist here; but I am not sacrificing myself to the “cause” of racial equality by subjecting my family to hate crimes in Detroit.
There isn’t anything inherently wrong with the people in Detroit. Just bad social structure and history that makes it darn near impossible to deal with. I think as they move away from Detroit those attitudes will fade. The lack of hope and myopia of those places is amazing.
Another consideration for some of the outside Detroit areas.
I believe the seeds of another automotive boom are happening. The fleet turn over rate has increased to something like 25 years. Hence, will likely increase in the future. My guess is that at some near future point, like 2013-2014 sales will pick up dramatically. That would return some employment to the region especially if they are smart enough to elect some government that wants to equalize regulation with the surrounding states.
Not sure that will happen tho. The liberal mindset of entitlement is so entrenched there. Might be all the people that are left are left.
Racism is a learned behavior. It’s a shame that this sort of bad parenting carries on from generation to generation. Fear and ignorance ruins lives.
Politically explosive decisions must be made about which neighborhoods should be bulldozed and which improved. Hundreds of millions of federal dollars will be needed to buy land, raze buildings and relocate residents, since this financially desperate city does not have the means to do it on its own. It isn’t known how many people in the mostly black, blue-collar city might be uprooted, but it could be thousands. Some won’t go willingly.
Now this is something that could reverse the decline in housing prices if adopted on a large scale. It would pump massive cash into the economy, create jobs, and reduce supply at the same time.
Hello everyone!
30+ days and counting and I get to leave the wonderful vacation I have been at here in afghanistan!
:) 
Well, get to the bazaar and get your souvenirs.
And don’t be an infidel - bargain hard and don’t believe them when they say this trinket/rug actually belonged to Alexander the Great’s Brother in Law (and has a made in China label)…
I have a Afghan “War Rug” that is quite nice… nothing like having a small carpet with tanks and rifles on it as a conversation piece in the living room.
Cool, you certainly can’t buy THAT at IKEA.
If you want to see what they look like there are always a few on Ebay… search for “afghan war rug”.
Apparently they war motifs were first made round the time of the Soviet invasion.
Be careful for what you wish for. I hope your transition to civilian life goes smoothly, but I caution you (and you may already know this) that adjusting to civilian life is a major challenge for vets returning from combat duty. It sounds like you have a nice family at home to (hopefully) help smooth the adjustment process.
I hope your transition to civilian life goes smoothly
Thanks PB,
But I still have two years left before I retire. I will retire from PA though….
My child in the oven though wont have any memories of the military. My wife is 12 weeks now and going tomorrow to hear the heartbeat. Wish I could be there. Being here is really a sacrifice, but we have done it before. She will be good and fat when I get home! We are hoping for a boy….
Stay safe, Step! It will be great to have you posting from the States.
Stpn, your post brings back memories of my own countdown calendar. Stay safe!
Stay safe!
Have a safe trip home, Step. And can you bring me home one of those humongous spiders?
Eeeeeeeeeeeeeee!
Admit it. You’ll miss the Timmy’s.
Best news today!!
Why not just extend everything on out to infinity and beyond.
Senate to take up unemployment insurance extension
Senate to act on unemployment insurance, tax breaks for individuals and businesses
WASHINGTON (AP) — Legislation extending unemployment insurance for the long-term jobless faces a key test vote in the Senate, its momentum helped by about 60 popular tax breaks for individuals and businesses that expired at the end of last year.
The measure also prevents doctors from absorbing a crippling cut in Medicare payments, extends health insurance subsidies for the unemployed and gives cash-starved states help with Medicaid, the federal-state program providing health care to the poor and disabled.
The unemployment insurance alone — to provide weekly unemployment checks averaging above $300 to people whose core 26-week benefit package has run out — will cost $66 billion through December. In some states people are eligible to receive benefits for up to 99 weeks.
The bill, and the test vote Tuesday, demonstrate the difficulty Democrats face as they focus on jobs. It doesn’t include new ideas for boosting jobs, but instead reprises elements of last year’s $862 billion economic stimulus bill, which is earning mixed reviews from voters. Simply extending those provisions has produced a far more expensive measure than a separate so-called jobs bill that Democrats hope to soon send to President Barack Obama. That measure would boost highway spending and give tax breaks to companies that hire the unemployed and could clear the Senate for Obama’s desk this week.
“… and give tax breaks to comapnies that hire the unemployed …”
Lo. The federal government plans to give tax breaks to employers that hire, meanwhile the states raise unemployment taxes on these same employers.
“tax breaks to companies that hire the unemployed”
It won’t create a single job, but it will force the least qualified candidates to be hired.
Politicians think there are jobs out there hanging weightlessly in some mysterious miasma, just waiting to materilaize on command. It matters not if there is a need for those jobs, other than the need for politcians to be seen as “doing something” of course.
Truth be said, I have seen local politicians “create” jobs, but it often leads to a Federal indictment at some point.
Or to put it another way, exactly how is government, or industry or anybody going to create the number of jobs lost to homebuilding downturn and the direct upstream downstream industries? Then there are the jobs lost to the general less demand not directly related to housing.
We’ll put people to work building roads for people to get to work, if there was any work. Which there isn’t, except for the building of the roads. So people will be working to build the roads so people can get to work and build more roads. But we need a green economy, so people really shouldn’t be driving on the roads, using gas. So let’s all just stay home and work for the government, administrating something or another and coming up with great plans involving road construction.
Everyone should stay home, and build a windmill out of the free construction material that Detroit willc reate when they bulldoze all the derelict houses.
Have our congresscritters never seen the following (three year old) IBM commercial
“What do you propose we do about the problem?”
“Build a giant catapult to throw the greatest of projectiles at the sloth…”
“This…”
“Are you suggesting we throw money at the problem?”
“Precisely”
http://www.youtube.com/watch?v=CZmHDEa0Y20
Extend and pretend is the name of the game. It will be interesting to see how long we can keep that up. I would guess at minimum until the next major elections this November. At the current rate it will take about 6 years until we reach the state Greece finds itself in today. The big difference of course is that we can print Dollars but Greece can’t print Euros.
Sooner or later our government will be backed into a corner by rising interest rates and trillion dollar deficits. At that point they most likely will monetize part of the debt. When that happens you can kiss your cash & cash equivalent savings good bye.
You don’t think repudiation is in our future? Argentina’s take-it-or-leave-it “offer” forced bondholders to accept 25 cents on the dollar and no past-due interest.
You guys are completely forgetting that all of the stimulus will work and the RE bubble will re-inflate and the boom will be on again like no tomorrow. Hope is all you need and a little faith in our dynamic, strong leaders. We have the best government in the world working on this and they will soon have everything humming along nicely again.
U.S. agriculture policy is a jumble, but the basic goal is simple: redistribute money to big commodity farmers. The median farmer’s net worth is five times the median American’s, and the top one-tenth of farmers get three-fourths of the subsidies. It’s a welfare program for the mega farms that use the most fuel, water and pesticides, emit the most greenhouse gases, grow the most fattening crops, hire the most illegals and depopulate rural America [Michael Grunwald, Time, 2008.11.17; cited by bernie Hunhoff, "A Farm 'Ouch' in Time," South Dakota Magazine: Editor's Notebook, 2008.11.10].
Brazil, (inspired by our tea parties?), decries American agricultural SOSHALIZM?
But don’t these people know we subsidize food and cotton for the children?
Brazil details US cotton retaliation, wants accord Reuters 3/8/10
Brazil detailed on Monday its planned retaliation against the United States over U.S. cotton subsidies but said Washington still had a chance to settle the trade dispute through negotiations.
The World Trade Organization gave Brazil the formal go-ahead last year to impose sanctions on U.S. imports after the body ruled the U.S. government spent too much subsidizing cotton farmers and on an export credit guarantee program.
The U.S. government is willing to strike a deal, but is “waiting for Brazil to start the process,” the lawmakers said.
Bilateral trade between the two countries fell to $36 billion in 2009 from $53 billion in 2008.
The trade dispute began in 2002 and is one of the few in which the WTO allowed cross-retaliation, meaning the wronged party can retaliate against a sector not involved in the case.
http://www.reuters.com/article/idUSN0810219620100308
I do think that the high level of agricultural subsidies in the country is crazy, and has more to do with the higher per-capita representation of agricultural states in the Senate than any reasonable public policy. But rather than look at how wealthy farmers are, it make more sense to compare incomes over the long term. Because most of that “wealth” is land and equipment. Saying that they’re wealthy is the same as talking about how the average Americans wealth increased over the last 10 years despite stagnant wages: it may well say more about the mispricing of land than about their projected future income.
Now this is soshalizm they can believe in.
Michele Bachmann: Welfare Queen truthdig.com 12/22/09
Michele Bachmann has become well known for her anti-government tea-bagger antics, protesting health care reform and every other government “handout” as socialism. What her followers probably don’t know is that Rep. Bachmann is, to use that anti-government slur, something of a welfare queen. That’s right, the anti-government insurrectionist has taken more than a quarter-million dollars in government handouts thanks to corrupt farming subsidies
But Bachmann isn’t the only welfare recipient on Capitol Hill. As it turns out, there is a filthy-rich class of absentee farmers—both in and out of Congress—who demand free-market rules by day and collect their government welfare checks in the mail at night,
Chuck Grassley, the longtime Republican senator from Iowa who warns his constituents of Obama’s “trend toward socialism,” has seen his family collect $1 million in federal handouts over an 11-year period, with Grassley’s son receiving $699,248 and the senator himself pocketing $238,974
Sen. Grassley railed against government intervention in the health care market, telling The Washington Times, “Whenever the government does more … that’s a movement toward socialism.”
Bachmann, of Minnesota, has spent much of this year agitating against health care reform, whipping up the so-called tea-baggers with stories of death panels and rationed health care. She has called for a revolution against what she sees as Barack Obama’s attempted socialist takeover of America, saying presidential policy is “reaching down the throat and ripping the guts out of freedom.”
(But) Bachmann has an inner Marxist that is perfectly at ease with profiting from taxpayer largesse. According to the organization’s records, Bachmann’s family farm received $251,973 in federal subsidies between 1995 and 2006.
Both dairy and corn are heavily subsidized—or “socialized”—businesses in America
These subsidies are at the heart of America’s bizarre planned agricultural economy and as far away from Michele Bachmann’s free-market dream world as Cuba’s free medical system. If American farms such as hers were forced to compete in the global free market, they would collapse.
However, Bachmann doesn’t think other Americans should benefit from such protection and assistance.
http://www.truthdig.com/report/item/michelle_bachman_welfare_queen_20091221/
But Bachmann isn’t the only welfare recipient on Capitol Hill. As it turns out, there is a filthy-rich class of absentee farmers
And I’m sure there are many Democrats too.
I’m just pointing out the hypocrisy in regard to health-care soshalizm’s critics.
I’m just pointing out the hypocrisy in regard to health-care soshalizm’s critics.
And the government health care zealots aren’t making use of the current (at least partially free market) system?
And Congress isn’t going to exempt itself from any gov’t health care program that it passes?
To be fair about it, the current agricultural subsidy policy is/was designed to stabilize food availability and prices.
Which worked admirably, until Wall Street bum-rushed the futures market.
I have several relatives who are farmers, all of them work their azzes off (most of them have to take part/full time jobs to make ends meet, and have the wife work, usually to have health insurance), own/lease 1000 acres or under, and none of them are “rich”, by any measure.
(My cousin bought the “family farm” from my grandad’s estate 5-6 years ago. 160 acres, with 3 bedroom farmhouse, barn two ponds, outbuildings and intact mineral rights. It appraised for $120,000……..the sad truth, is that there are millions of acres of land in this country which are useless for anything except farming.
Yeah, you can complain about the subsidy system. But unless a replacement system is well designed (by Congress??), the alternative to the status quo could easily be worse.
X-GSfixer: Yeah, you can complain about the subsidy system.
I know but my complaint is more about hypocrisy of certain pots calling the kettle black. Family farms being hammered by policies favoring corporate farming is another subject too.
LehighValleyGuy:And Congress isn’t going to exempt itself from any gov’t health care program that it passes?
I think that’s hypocrisy.
they must know there is not enough government money to go around and they don’t want to lose what they get
Fun to watch this all in action.
Kind of like the tea party people going on about healthcare and saying “Leave my medicare alone”.
Really difficult to get away from these programs once they become entrenched in the system. Becomes part of the business model, effects valuations.
Like every part of the system, when you make some deflationary effect by withdrawing support, things get all messy because everyone seems to opperating on the brink on insolvency.
Why does it call her a “teabagger”? That’s kinda nasty.
It’s what they call themselves!
Rio, I posted yesterday about American farmers moving to South America and so doing well that the big ag manufacturers (John Deere, etc) were setting up larger operations as well.
Can you comment on this?
Rio, I posted yesterday about American farmers moving to South America….Can you comment on this?
You are correct and apparently by all the articles on the web, it’s even bigger than I thought.
I remember over 10 years ago, Jim Rogers saying this would be a good type of move and apparently he was right.
It’s possible commodities are just beginning to see their day. The world is growing and other countries are getting richer. Heck even Brazilians are getting a little fatter. (a little)
On a distantly related note here’s an interesting article on some of the first American farmers (and former slave owners) to move to Brazil after the Civil War.
A Taste of Dixie in Brazil In Americana, They Wave the Confederate Flag–With Some Reservations
AMERICANA, Brazil-Every year, at a secluded cemetery hemmed in by soothing hills of sugar cane, hundreds of Brazilians converge on this factory town to throw a party, complete with deep-fried chicken and biscuits, corn bread and candied apples.
There’s banjo music and billowing, Southern-belle skirts and lots of jokes, mostly good-natured, at the expense of Yankees. These Brazilian partygoers have names like Jones and Pyles and Steagall. And there are lots of Confederate flags.
“It’s ironic, I know,” said Allison Jones, who attends the April party every year, “that we come to a cemetery to keep our heritage alive.”
The celebrants, whose ancestors abandoned the American South for Brazil after the Civil War, worry a lot about their heritage these days. They worry about being shunned by other Brazilians, for whom the American Confederacy represents racism, slavery and unwelcome controversy.
And they worry about today’s generation of confederados, as these Brazilians of American ancestry call themselves. Many are not much interested in the history and traditions that their elders have struggled to pass on.
The Americans came to Brazil at the urging of Emperor Dom Pedro II, who longed to see them bring their cotton-planting expertise to his sprawling land. By the late 1860s, several thousand Southerners were steaming for Brazil from the ports of New Orleans, Galveston, Tex., Charleston, S.C., Newport News, Va., and Baltimore.
http://www.researchonline.net/sccw/brazil2.htm
Now ain’t that interesting?
Thanks Rio.
Sorry for the totally off topic cross post, but I just thought that maybe I’d find some other frequent fliers on here who would like to rant about how planes/flying has become a huge billboard in the sky! It’s maddening to be forced to sit through commercials, and it’s only getting worse…
Here’s what set me off:
http://www.marketwatch.com/story/in-flight-sales-take-off-as-ticket-prices-decline-2010-03-08
As someone who flies alot, I’d be willing to pay a lot more for a ticket if the flight attendants would just SHUT UP and let us fly in peace. I don’t want to hear about the Skymall catalog for 10 minutes while I’m trying to read, I don’t want another credit card, and I know how the frequent flyer program works. Sit down, be quiet, and let us fly.
Another big pet peeve.. Let me get a little sign to hang around my neck that says “I know about the safety regulations, and I’m willing to take the risk that you’re going to say the same thing that I’ve heard 300 times.. I’ll be leaving my headphones on, thank you very much”.
And finally.. Can somebody please tell me why it’s a matter of upmost importance that I don’t finish typing my e-mail as we’re landing or taking off? Can you really take down an airplane with a laptop? Is the plane going to explode on the runway if I turn on my Kindle? Why do we need to turn on/off our non-transmitting electronics for takeoff and landing? And, if it’s so important, why doesn’t anyone care that I’ve occasionally left my cell phone transmitter on accidentally during takeoff and landing?
Rules for group safety I understand. Rules for the sake of having rules? Those make no sense at all to me! If I’m an @#$%&! and don’t understand that if the plane hits the ground at 600MPH I probably want to look for an exit, then I most likely deserve to die.
Yes, I’m flying this afternoon.. And I’m already p*** off about it.
You could blame the insurance companies if you wanted…
Or the insurance companies’ lawyers
Any electronic device that has a microprocessor, even a non-transmitting device, has a clock oscillator that operates in the radio frequency range. The device’s mostly plastic case allows that signal to radiate at least some distance. It is theoretically possible that such clock oscillator signals from your device and from the other 100+ passengers’ devices could interfere with the ground transmitter signal that the pilot is relying on to keep the airplane on the proper glide path as it approaches the airport in cloudy, foggy, or poor visibility conditions.
A buddy of mine did a test on C130 Hercules aircraft, and found signals bounce around inside the frame with the potential to interfere. It’s a small risk, but it’s a smaller inconvenience to get people to turn stuff off.
I have always loved, trusted and jumped the military C-130’s and C-141’s but I have limited faith in these XYZ Air Academy whiz kids flying these jet powered commerial aluminum tubes with me in them.
Of course, I was younger then, knew where all of the doors were and I always had a freakin’ parachute and a reserve.
The real reason you have to turn your electronic devices off is that the cell providers want all the cell phones off. Their algorithms for negotiating with the nearby towers do not degrade gracefully in the face of altitude—e.g. when you can talk to two or three towers, they work great, but when you can talk to twenty or thirty, they do not. And the number of towers that you can communicate with increases dramatically as you climb.
Cellphones don’t work above 5-10,000 ft above AGL. I’ve personally verified this numerous times on aircraft test flight. Unless, of course the aircraft has a Wifi network router installed.
Most commercial and business aircraft built since about 1990 have all their electrical wiring HIRF shielded. But a lot of airplanes built before 1990 are still flying. And nobody can guarantee that the HIRF shielding won’t break down/fail to protect the systems.
The passenger briefing is an FAA requirement for Part 121 and 135 operators. Failure to deliver it could cause bad things to happen to your wallet, or Operating Certificate
Two words:
Virgin Atlantic.
a nice little unobtrusive pair of earbuds is a good investment.
And if I may add to your excellent rant, why do airports (especially the dreaded O’Hare) have loud announcements about security measures in areas where everyone has already gone through the security checkpoint? If we didn’t know about the 3-1-1 rule we wouldn’t have made it through! Save the speeches for the check-in area.
First, let’s make airplane travel not only inconvenient, then step it up notch with harassing the passenger (could you strip please?) who are then handled by overworked and underpaid stewards and stewardesses.
Then charge more for it all.
Then wonder why revenue is down.
One of my goals in life is to never fly again. I’ve done it dozens of times, enjoying none of them. I’m just not sure how to get around the funeral thing.
Ok - I admit to watching some trash TV.
On Bravo - the “Housewives of Orange County” in the season final episode (I HAD to watch it!) they give a “snapshot” at the end of where people ended up about 3 months from the end of the episode.
One of the main couples got divorced and sold their house as a short sale.
They did not give any details. I was pissed. Any taxes due? Did they bring any money to the table? Do they just get to walk away scott-free after living above their means for the last 5 years? Is their credit wrecked and they are living in a Motel 6? In a previous episode another couple got foreclosed upon (but it really was no big deal to them – they went out and got an even better place!).
I wish they would make an episode with the short sale! That would have been fun.
I don’t get mad or even hate these people on these shows. I know how it is going to end from my HBB education. But it is fun to watch to see all the tell tale signs (like you bought a $900 dress when the rent is past due?).
I couldn’t stop watching that show. I found it fascinating….that is, the “pretending to be rich” aspect of it.
Housewives of OC is my guilty pleasure. My husband rolls his eyes every Thursday night when I change the channel. It’s like a train reck! The show is sooooo staged. But I watch anyway.
My favorite Vickiism:
“I have to work!”
Woo Hoooo!!!
On March 7th, Tom DeLay, former GOP majority leader says people are unemployed because they want to be. hummm…
Where in the world can they work Tom…in Brazil, Mexico, China or India ?
CNH was once an American company — Case Tractors (think big like John Deer farm stuff and manufacturing) Bought by the Dutch and now mostly owned by the Fiat Group.
Business
CNH opens large factory in Brazil
By Rick Barrett of the Journal Sentinel
Posted: March 8, 2010 |(13) Comments
CNH Global, which manufactures farm tractors in Racine, has opened a $563 million factory in Brazil that will employ 3,000 people and could create an additional 3,000 jobs at suppliers.
The factory in Sorocaba will produce agricultural and construction equipment for more than 50 countries, according to the company.
It is the biggest single machine industry investment in Brazil’s history, CNH said in a news release. The company declined further comment on the 525,000-square-foot factory.
Besides finished machines, the plant will produce parts for other CNH manufacturing sites including a Brazilian factory that makes sugar cane harvests….cont.
http://tinyurl.com/yz3drt8
CNH Global, which manufactures farm tractors in Racine, has opened a $563 million factory in Brazil that will employ 3,000 people and could create an additional 3,000 jobs at suppliers.
This is out of control. Brazil is not even a low cost producer as China is.
This makes me mad, sad, disgusted and fearful.
Business and government really sold us citizens out.
But farmers in Brazil do BUY tractors, so opening a plant there makes a lot of sense. Brazil and Argentina are now jointly the largest agricultural exporters in the world.
But farmers in Brazil do BUY tractors, so opening a plant there makes a lot of sense.
That’s a good point too.
I was just expressing my feelings in an overall context of US outsourcing, strategic US industries being sold to foreigners and of Brazil being very protective of their market and industrial base while the USA is giving away the farm.
From the article:
“If you want to sell equipment in Brazil, you need to produce it there. They have local-content rules that are really strict,”
So, you live in Brazil for all the eazy babes?
Heard there are some good demographics down thataway?
Foot-in-mouth disease seems to really be going around these days.
Are you talkin’ to me? If so please explain.
No - I made my comment before I saw yours. I was referring to DeLay’s “people are unemployed because they want to be” gaff.
P.S. I’d love to get into a really big international trade discussion, but just don’t have the time.
A suggested read would be P.J. O’Rourke’s “On the Wealth of Nations” (brief and humorous summary/discussion of Adam Smith’s work).
A suggested read would be P.J. O’Rourke’s “On the Wealth of Nations”
Thanks for the tip , I’ll check it out this summer while visiting for Independence Day.
(Brazil has a 4th of July, but they don’t celebrate it)
Tickets are expensive now.
I was referring to DeLay’s “people are unemployed because they want to be” gaffe.
Except it wasn’t a gaffe. That’s what he believes. If it was a gaffe, there would have been an effort to distance oneself from the statement and move on to something else as quickly as possible. Instead, it’s the talking point du jour of one of the political parties.
That many if not most of the people that are unemployed/underemployed would like to be working at a decent wage versus collecting unemployment is irrelevant to many in that party.
That DeLay’s getting interviewed at all says volumes about the current state of the U.S. MSM. Let’s see, that interview was on CNN, FOX-lite.
Yeah, you dispalyed that quite well with your data manipulation yesterday “ChartBoy”. Still haven’t coughed up that hairball of “deceit” that got stuck in your throat hey?
(I have to take Mr. Cole to school this morning, but no worries packy mate…be happy to help with that in just a lil’ while)
You know - I generally make it a point to never use the ignore feature on my browser. I never have. I’d rather just skip over the posts; perhaps just skipping through them some - as often even the most inane posts / posters sometimes at least have some grain of worth to add.
You however might just be my first exception.
Well you certainly used the “ignore-the-truth”" feature in your post yesterday dudette “ChartBoy™”, but in 5 years of reading & posting on Mr. Ben’s HBB I’ve never seen someone that was so desperate in trying to prove a falsehood that they had to resort to manipulating data from a Case/Schiller chart, but as I said…I’ll help you with that in just a bit…
It’s all bush/ cheney’s fault.
Easy, guys. Save any animosity for Eddie in case he returns.
The Obama administration is indeed Bush/Cheney’s fault.
Ya know, just putting a
doesn’t absolve you from being as @ss… Just sayin’…
wow, hubby used to work for a Case dealer…
“wow, hubby used to work for a Case dealer…”
Two of my older Illinois hunting buddies used to work for Case.
They were lucky enough to be offered a buy out and took early retirement because they saw the writing on the wall.
Sounds like that might be useful equipment for preserving the “Rain Forest”
I couldn’t tell whether the NPD Group’s research was a natural survey or regional, as the writer in this article did not make this clear. I am assuming it is national, as I sensed a much more profound drop than 3 percent in San Diego restaurant volume in 2009, at least for my biased sample. Restaurants where we would have waited 1/2 hour for a table circa 2006 now have vacant tables, all evening, every night of the week.
Dining down, but hopes up
By Lori Weisberg, UNION-TRIBUNE STAFF WRITER
Monday, March 8, 2010 at 8:31 p.m.
To no one’s surprise, traffic volumes at restaurants slumped in 2009, but industry watchers see faint signs of hope that business is picking up as consumers both nationally and in San Diego County start dining out more frequently.
NPD Group, a leading market research company, reported an overall
3 percent decline in restaurant visits in 2009 compared with a year earlier, though declines in the last three months of the year slowed following steep losses in the third quarter. All segments of the industry, from fast food to fine dining, saw fewer customers, but upscale restaurants suffered the steepest losses.
“In 2008, consumers appeared to trade down some full-service visits for fast-food visits. In 2009, they made fewer visits to restaurants overall,” said Bonnie Riggs, NPD’s restaurant industry analyst. “When consumers did visit restaurants, they favored lower-priced options.”
A combination of anemic traffic and only a modest growth in restaurant checks led to a decline in consumer spending at restaurants last year, the first such decrease since NPD began tracking the food-service industry in 1976.
…
NPD tracks sales data for a lot of industries, if I remember correctly they use both point-of-sale data from major retailers and credit card companies.
They provide a lot of data that can be drilled down into. For example if you want to know the average sale price on a particular category of clothing item you can find that.
They are well respected and pretty comprehensive in their analysis.
“the average sale price on a particular category of clothing item”
See, that’s the kind of line that makes me think of Oly. She would have cherry-picked that and riffed it hard. It was that riffing that I had come to rely on.
See, that’s the kind of line that makes me think of Oly.
Stopped at the coffee shop on the way to the dog park over the weekend. There was a car in the lot with a license plate that read: “GUIDUCK”. Had to have a chuckle at that as I thought of Oly..and also appreciated it since I’m a UI software developer
THAT is funny.
I wasn’t questioning NPD’s reputation, but rather whether the scope of their analysis discussed in the SD U-T article was regional or national. If my interpretation is correct, that the NPD figures were from a national survey, then the breezy manner in which the journalist juxtaposed the NPD figures with upbeat anecdotes from local restaurateurs was quite misleading.
Every time I saw the term “price point”, I had this reflexive urge to hurl. If I never see or hear that bubble term again, it’ll be too soon!
Is it asking too much for decent food and service at a decent price rather than focusing on how high we can ratchet up the “price point” before the customer feels gouged?
Price point. Price point. Price point.
Me too on wishing this term would go away.
Screw the restaurants. Around Milwaukee, many are 3rd rate, expensive and Chicago is 80 miles and a few speeding tickets away on a foggy night.
I, as well as my brother and tiny sister, did about 13 years of hard labor KP under Mess Sgt Mom. This disturbed woman was actually an officers wife that loved to entertain and feed everyone from wondering idiot military brass to the lost neighborhood kids we’d find.
Dispite her, my time in captivity was not entirely wasted. Hell, due to some idiot named Emily Post, I was forced to know where and what to do with most knapkins, knives, forks and spoons. I knew Betty Crocker, the Better Homes CB and my Grandma’s secrete recipes better than my Jr High boxing and track coaches..b..b..but
I can easily wash, marinate, flavorite, mutilate and rotisserate a 7 lb beef roast. I can even make reasonably good brown gravy. Baking bread from scratch isn’t as hard figuring the formula for cutting a big piece of rail steel with an under-weight, scrawny little piece of C-4 on a dark rainy night in RECONDO School.
I can easily peel fresh potatoes, steam veggies and prepare a nice fresh salad. I can even make the vinager/wine/H20 salad dressing or whatever.
I can easily open a bottle of cheap red wine at 1/3rd of the restaurant’s bill. I’ve go several cases of the crap that I should check as some might be valuable or vinager by this time.
I can even offer fresh ground coffee, a slab of chocolate cake and/or some ice creame(home made sometimes) for desert.
Screw the retaurants, I’m cheap, 1 bottle of wine is NEVER, ever enough and I didn’t spend my tortured youth slaving in that hot kitchen for that crazy woman for nothing !
Authors note: I occassionally have a little time on my hands and I also have a fairly new g/f that I like in my hands…(just try THAT in a Chicago 5 Star restaurant)
I
vinager/wine/H2O salad dressing?
Didn’t think you were questioning NPD’s reputation.
I probably should have been a bit clearer, they not only provide their opinion/analysis but sell data that can be queried by the subscriber so you can run customized reports.
It certainly can be used to support a preconceived viewpoint. (As my grandmother always used to say: “Figures don’t lie, but liars can figure”.)
Oh and “price point” is a standard term used by product developers: they try to figure out an appropriate retail price for a type of item and then design a product at the suitable margins for that retail price. In apparel, for example, small variations in fabric construction, trims, etc. can lower the price significantly with little difference to the consumer.
BTW a big factor in pricing “trendy” apparel is whether you have time to send it on a boat or if it must be air shipped.
If the situation is anything like in my area, they’re right.
Add this to your list of drawbacks to buying that million dollar beach front property:
High surf threatens homes
Residents trying to protect property from erosion
By Janine Zúñiga, UNION-TRIBUNE STAFF WRITER
Tuesday, March 9, 2010 at 12:03 a.m.
Residents of a condominium complex have placed sandbags to protect against the high tides and big waves that have removed much of the sand that was a barrier between their property and the ocean. Some residents blame a nearby development for the problem.
Peggy Peattie / UNION-TRIBUNE
People gathered in January at the end of Palm Avenue to watch the large waves break. Imperial Beach has been battling erosion for years. Funding for a planned replenishment project never materialized. Mayda Winter
IMPERIAL BEACH — All that remains of a small, sandy beachfront yard once filled with lounge chairs and a fire pit are precariously stacked, protective boulders that residents of a four-unit Imperial Beach condominium complex say have sunk up to 10 feet.
A particularly damaging mix of high tides and high surf and a growing number of winter storms have stripped the sand from much of Imperial Beach, resulting in an emergency situation for Bill and Marty Arbuckle and their neighbors on Ocean Lane. They have asked the city to permit them to temporarily protect their condos with special 6-by-6-foot sandbags.
“This is the first time since we’ve lived here that we’ve had this kind of a problem,” Bill Arbuckle said last week from his home of 12 years as wisps of water from crashing waves reached his second-story sliding-glass door.
Imperial Beach officials, who approved the condominium owners’ request for temporary shoreline protection, say the problem isn’t limited to those at the condominiums.
“Shoreline erosion is a constant in our city but we’ve had consistent high storm and high tide events since December,” said Community Development Director Greg Wade. “Encinitas, Carlsbad and other coastal cities are having similar issues. The surf is so consistently high, there is no time for sand to settle back on the beach, which provides protection.”
…
I went to Maui a few years ago and stayed in a small quadplex on the beach that was for sale for 1.8mil. In the back yard was a massive tree that was sitting in the ocean. The guy above had been coming there for several years and said the ground had extended 20-30ft past the tree when he first came. It looked like that house might have a 10 year lifespan before it was reclaimed by the sea.
That’s the first time I’ve ever heard of 6 ft by 6 ft sand bags.
One side effect of the (typical) El Nino beach erosion of this winter is that ordinary Spring and Summer surf will cause greater rip currents than would otherwise occur.
Will those that are drinking in inflatable devices to avoid the alcohol ban at most beaches end up farther from the beach than they expected?
“drinking in inflatable devices”
Not familiar with this phenomena—can you elaborate?
Is that like an inflatable cup? Or behind inflatable walls, like those bouncy-houses that kids play in?
They can’t drink on land by law any more, so they put themselves and their drinks in an inflatable boat and float themselves a short distance from the beach.
It would never have become an issue except the near riots from some that were drinking. Another side benefit has been that the beaches are much cleaner after major holidays. They used to look like garbage dumps. You wouldn’t believe what was left on the beaches. Not just the volume, but the types of trash as well, anything imaginable including sofas!
As much as I stick for the little guy around here, this is a great example of why the PTB don’t give a damn about the average person and I can’t blame them.
“…stick up…”
I CANNOT proof my own stuff.
“Shoreline erosion is a constant in our city but we’ve had consistent high storm and high tide events since December,” said Community Development Director Greg Wade. “Encinitas, Carlsbad and other coastal cities are having similar issues. The surf is so consistently high, there is no time for sand to settle back on the beach, which provides protection.”
Oh! Think of the children!
Beach erosion is a very serious problem for the beach front condos here in south FL, too. No problem for the wealthy owners though since the state offers property insurance for everyone and we can all help pay to rebuild some day.
Only an idiot builds near a beach and then complains about erosion and insurance and state regualtions.
Collapse of the American Empire: swift, silent, certain
http://www.marketwatch.com/story/the-rise-and-certain-fall-of-the-american-empire-2010-03-09?siteid=rss&rss=1
The link does not work but I still have hope for change.
Try this one. It worked for me. Odd.
http://www.marketwatch.com/story/the-rise-and-certain-fall-of-the-american-empire-2010-03-09?siteid=rss&rss=1
Tankxs, have to read later…
“…military overstretch suggests that the United States”
No worries Mates, I’m certain the Democrapts 2010 budget is gonna be even more (how’s that non-partisan
) :
February 22, 2008
“On February 4, the Bush administration released its budget request for Fiscal Year 2009, which begins on October 1, 2008. For FY 2009, the White House is seeking $711 billion for the military…”
My motto for 2010: “Keep Americans safe…protect CORPORATIONS!”
Corporations: “We’re People too!”
Harvard’s Niall Ferguson, Economist “The Ascent Of Money” (PBS Documentary), and Jarad Diamond’’s book “Collapse”, are the core of the above article.
Saw The Ascent of Money recently on PBS. Lots of great info in there! Definitely a recommended dread or watch. Unfortunately he didn’t delve much at all into the current crisis (he could have since it’s a recent production).
Hopefully he’ll do a follow-up.
I met Niall Ferguson when I was a volunteer at NYC’s public radio station. Had to appologize to him for skipping the monetary policy chapter of the book he was flacking on Leonard Lopate’s show when I wrote the interview outline. He didn’t mind that much. We did long format interviews (his was probably a solid 25 minutes), but there just wasn’t time to cover why GB became a world power and France didn’t and cover the gold standard in the same interview.
Nice guy. Very cheerful.
Cool! That’s neat.
Was the interview about the gold standard, then?
The interview was about his book called, “The Cash Nexus.”
See it here: http://www.amazon.com/Cash-Nexus-Economics-Politics-1700-2000/dp/0465023266/ref=sr_1_7?ie=UTF8&s=books&qid=1268169043&sr=8-7 Wow. Cheapest used hardcover listed on Amazon is nearly $20. New ones are over $50.
And, no, as I explained, I decided to skip monetary policy. It was a while ago, and I thought it would take too long to do the background explanations even in a long format interview. It wasn’t reasonable to assume that the audience had spent much time thinking about monetary policy (though we generally assumed a very educated audience). By skipping that chapter, I was able to cover most of the rest of the book and keep the host of the show closer to his comfort zone. Always the best way.
Ah - I misread - so you covered the GB/France thing instead I presume?
I might have to read more of Ferguson’s history stuff. It sounds interesting (and controversial).
This is also the same girl that starred at and possibly even talked to strange fish in NYC.
Huh? OK. Am I now not only forgetting what I have shared on the blog but what I did when I lived in other places? I am totally baffled.
Last fish I communed with were at the National Aquarium in the basement of the Commerce Building here in DC. Cute little place. I should walk over tomorrow if it hasn’t started raining yet….
Dang. Although it was 1981 it seems like only yesterday that it was “morning in America.”
I wonder if articles like this were written in the 1930’s. Nah.
Bill in Carolina
This have changed since the GD1, and we did away with the GD1 reforms. I respect your point, but globalization, a more corrupt govt., lobbyists, and a different economic structure do make for a different outcome.
Which is locked in and cannot be changed?
History shows that once a corrupt aristocracy controls everything, the only way change happens is through disaster and very disruptive upheavel, i.e., total economic collapse; invasion; revolution; coup d-etat; purges; world war; etc.
So yes, it can be changed and if we’re lucky, we can avoid mass violence. But that’s a really big IF.
“This” s/b “Things” - it must have been grade inflation
So we’re all supposed to “buy a farm in the mountains” in order to survive the apocalypse. Show me some good farmland in a remote, mountainous, defensible area and I’ll be there!
Wonders if how long it will be before they have Roadrunner service and an Applebee’s in in Machu Pincchu ?
“Most great nations, at the peak of their economic power, become arrogant and wage great world wars at great cost, wasting vast resources, taking on huge debt, and ultimately burning themselves out.” We sense the “consummation” of the American Empire occurred with the leadership handoff from Bill Clinton to George W. Bush.
I don’t doubt that the American empire is in rapid decline. But does end in implosion or with America having a lesser role in the world and a somewhat lower standard of living, similar to what happened with the UK? While not at the peak of it’s power internationally in the 1930’s, America was relatively stronger then than it is now.
And to answer Bill in Carolina’s question, the empire is coming to an end. I don’t think there is much we can do to change that. I don’t think how it ends or how we continue afterward is settled at all. I haven’t seen anything yet that makes me believe we have any leaders that could put us on a less painful course for the decline.
One of the more fascinating parts of the decline will be the guns versus butter issues. Will we fund grandma’s retirement or send Junior to Afghanistan?
Good POV SDGreg…since I’m fond of aphorism:
(Hwy singing…”All my life… I’ve been a wandering…and just when I think I’ve reached the end…the old road, it’s starts a bending…then I wonder…what’s around the bend?…)
War & Disease
(kinda tempers all the COOL things that’ll be created in the meanwhile!)
California’s high unemployment rate is helping me to get a better lane to swim in the pool. One of the regulars who takes one of the two best pool lanes in my gym’s pool is moving to Japan.
His company is forcing him to go part time. American by birth, he is bilingual in Japanese and has a Japanese-American wife originally from Japan.
He’s an older boomer. So adventure and opportunity won’t stop the older ones from going to better places in the world where the jobs are not so bad.
Japan’s been in a depression since 1990 and is probably going to get out of their depression before we do. They will reverse their birth dearth before the U.S. reverses.
What, are they going to allow more immigration?
The way things are going in the country, you might have the pool all to yourself Bill.
“Bill, where’s Bill…Anyone seen Bill ?”
“Ahso ! ”
Re: Japan.
Has anyone seen a decent analysis on what happens to Japan with the low birth rate, and long-living eldery population. Do they have to tax/reptriate corp profits? Does deflation continue for the next 20 years
FWIW (as two side points):
- Japan’s “deflation” has been mostly overblown. Prices have actually been quite flat there for the past 17 years.
- I’m wondering what’s going to happen with Toyota’s problems right now. These accelerator problems, and the resulting media storm, have been absolutely killing Toyota sales, and probably will for years to come. Being that Toyota is such a large part of Japan’s exports - they could be in for an even tougher stretch the next few years.
Many of Toyota’s cars sold in this country are assembled… in this country.
As for sales, Toyota will remain one of the new Big 3 for a long time to come.
The problems are design, not assembly, problems - no?
FWIW though - I think they’re way overblown. E.g. see the WSJ report (will post a link) showing how a portion of an ABC report on the faulty petals was faked.
link
Toyota Slams ABC Report on Pedals
Network ‘Staged’ Video, Car Maker Says as It Replicates Acceleration in Other Makers’ Vehicles
Toyota Motor Corp. on Monday criticized ABC News, saying the broadcaster “staged” part of a report that purported to show electronic problems could cause Toyota vehicles to accelerate unexpectedly.
…
On Feb. 22, ABC News aired a report on Mr. Gilbert’s findings. In it, a Toyota Avalon sedan driven by investigative reporter Brian Ross is shown traveling about 20 miles per hour, and when Mr. Gilbert causes a short in the electronics, the engine suddenly revs and the vehicle speeds up.
The original report included a shot of the car’s tachometer needle racing up to more than 6,000 revolutions per minute, near the safe limit of the engine’s design. At its news conference, Toyota presented a still frame from the video that showed dashboard lights indicating the car was in park, the speedometer was at zero and the seat belts weren’t buckled.
“They staged it when the car was sitting still,” Toyota spokesman John Hanson said.
The discrepancies in the clip were noted by gawker.com, a media web site, and on Friday ABC replaced that part of the video on its Web site. The new clip shows a shaky video of a tachometer surging inside a moving vehicle, though it doesn’t reach 6,000 rpm.
“They will reverse their birth dearth before the U.S. reverses.”
The US is still breeding stupid people like crazy. See the movie ‘Idiocracy’ for more details on the outcome.
But isn’t that true everywhere? Those with no education or advantages in life generally have the most offspring.
I think it has more to do with a lack of other entertainment opportunities.
We all can’t live in New York or LA.
devolution
In a word Elanor… yes.
I recall reading population growth forecasts estimating that the US would be way past the 400 million mark by 2050. It might be lower now that illegal immigration has slowed down
One of the things I’m beginning to see are talented people that have been in California forever beginning to leave. A few questions:
1) Is it really that bad in California versus other places?
2) Will skills that were surplus in California fill a gap elsewhere?
Either way, I’d say it’s bad for California. I’d rather be driving out the welfare rats than those with talent that are currently unemployed or underemployed.
SDGreg
We reside in Thousand Oaks (Ventura County), just north of Los Angeles County. The illegal invasion is quite noticeable here, while while collar firms are downsizing, or closing. When we sold our McMansion (5 years ago), we heard most of our fellow professional neighbors had lost their jobs, and were leaving the state.
What’s the pattern been in San Diego?
When I moved to the L.A. area in late 1994, it looked like much of the middle class had already left or had moved to the fringes of the L.A. metro area. High costs and the gang/illegal/crime issues didn’t leave much of a middle class.
When I got to San Diego in late 1998, there was still a decent-sized middle class. Costs were less and much fewer gang/illegal/crime issues. Traffic then was almost manageable but increasing sharply. The tech and housing bubbles pushed costs (especially housing) and traffic sharply higher and electricity costs went sharply higher around 2000 (thanks Enron).
A portion of the middle class cashed out and move out around the peak of the housing bubble. The gang/illegal/crime issues are still far less in San Diego than Los Angeles. Traffic has improved some and housing costs have fallen some but are still quite elevated. Rents and housing prices are still much higher than during the late 90’s. Wages are nothing special compared to the costs. Still nothing good happening employment. I’m not sure which area has a sewer system and roads in worse repair. San Diego roads (pavement condition) are the worst I’ve seen in any American city that doesn’t have freeze/thaw issues. The climate’s still great, but there are still plenty of reasons for there to continue to be a steady departure of the middle class from San Diego.
I really thought I could wait out this bubble. Just too hard to keep the family in a questionable area waiting for the bubble to burst. Meanwhile other sunny spots are calling my name.
Yeah, gangs, illegals, homeless, out of control taxation, traffic… Been waiting for prices to drop to semi-sane levels for a long time. Kind of done with it. Elsewhere prices have returned to pre-bubble levels.
Let the long term deflation kick in out here. Again a long slow process.
james
Where are you guys looking to move?
I know what you mean. A simple ranch 4+2 w/a pool, 2000 sq ft is $450K-$550k. That’still insane. $350K should be the cap. $225+ a sq ft is ridiculous. Add all the negatives and you’re over paying for a 3rd world quality of life.
Parents of Dead SoCal Teen Urge New Predator Laws
By THE ASSOCIATED PRESS
Published: March 9, 2010
Filed at 3:49 a.m. ET
ESCONDIDO, Calif. (AP) — The father of a 14-year-old girl whose bones were found more than a year after she vanished walking to school urged supporters to behave like his late daughter’s favorite animal, the wolf, to hunt down child predators.
”Wolves hunt to survive, wolves hunt to together to catch their prey,” Maurice Dubois told more than 1,000 mourners at a candlelight vigil Monday night for Amber Dubois. ”We as parents and the community need to make a change for the protection of our children.”
Mourners held a moment of silence for Amber, whose remains were found early Saturday in a rugged area north of San Diego, and 17-year-old Chelsea King, who disappeared Feb. 25 in a north San Diego park. A body presumed to be Chelsea’s was found March 2 in a shallow, lakeside grave.
John Albert Gardner III pleaded not guilty last week to murdering and raping or attempting to rape 17-year-old Chelsea King of Poway and attempting to rape another woman in December in the same park where King disappeared.
His public defender, Michael Popkins, did not respond to a phone message.
The registered sex offender was expected in court Tuesday for a brief hearing to address procedural issues.
Escondido police say Gardner, 30, is also a focus of their investigation into Amber’s death.
Carrie McGonigle, Amber’s mother, said laws need to be changed.
”I still see a lot of children walking by themselves and it scares me,” she said on a chilly night in the courtyard of Escondido High School, near the spot where Amber disappeared Feb. 13, 2009, in the north San Diego suburb.
Police said Sunday that Amber’s remains were identified through dental records. They have not said what led them to the remote area near Pala because the discovery is part of a murder investigation.
”Yesterday was my personal time for tears,” Dubois told the audience. ”Now, for Amber, it is our time to take action.”
…
Yeah, let’s pass ANOTHER law outlawing murder. We’re start a foundation outlawing murder, and won’t rest until it gets passed.
What do you say we try ENFORCING the laws currently on the books? If you can’t, why not? Lack of resources? Campaign to make the resources available. Resources available, but utilized to write speeding tickets and spend an hour beside the road, shaking people down and taking them to jail for having remnants of a joint in the car? Or, God forbid, being .081?
This stuff ain’t rocket science.
Sheesh, even when I was a kid (think dinosaurs), we were taught you DO NOT walk home from school by yourself, let alone if you’re a girl.
Among other things like don’t talk to stranger, run away as fast as you can if you are being followed, stay in a busy are if you have to be by yourself, don’t go to bed with your windows open or unlocked, etc.
The reality is you will never see a 100% crime free society.
Today is my birthday (also the official birthday of the “recovery” which started on this day exactly one year ago). Happy birthday Banksters!
Cheers!
“Today is my birthday”
Happy Birthday to you.
Happy Birthday to you.
Happy Birthday dear pressboardbox
You deserve a great day, with balloons and cake.
(Didn’t want to pay ASCAP)
This cow should be put out to pasture, has no clue what she is talking about, but what’s new.
Deficit a Problem But Don’t Stop Spending: Romer
Tuesday, 9 Mar 2010 ~ Reuters
The gaping U.S. budget deficit is cause for concern but clamping down on spending immediately would be “pound-foolish” and derail the recovery, a top White House economic adviser said Tuesday.
Christina Romer, who heads the Council of Economic Advisers, said cutting back now “would inevitably nip the nascent economic recovery in the bud—just as fiscal and monetary contraction in 1936 and 1937 led to a second severe recession before the recovery from the Great Depression was complete.”
Romer, in a speech to the National Association for Business Economics, also said President Barack Obama’s $787 billion stimulus package had been successful in pulling the economy out of a deep recession.
However, she said additional measures were necessary to bring the jobless rate down from the current level of 9.7 percent, which she called “a terrible number by any metric.”
Listen to her reguritate her interpretation of GD I history, these people have a built a cult around the New Deal. They are quite literally using their history book as a road map. I dunno what everyone else thinks, but I find that scary. Yes, history holds many valuable lessons - but to slavishly follow it is akin to blindness.
Sometimes it just seems this country is stuck in the 20th century, admiring its “glory days” like a potbellied former varsity fullback or a wrinkled former prom queen.
FWIW - you *can* spend your way to prosperity, and I think that the late-depression dynamics do show that to some extent. The problem is that dang debt that’s left over.
The New Deal “worked” in terms of reducing unemployment somewhat, but at a cost of taking our debt from about 35% to 45% of our GDP. That was mostly low-hanging fruit though - we had 25% of people out of work. The last 10% is the toughest.
This time we’ve jumped about the same amount in terms of debt (70% to 85% of GDP), but have only served to flatten unemployment, not reduce it significantly at all. Can we really afford to keep our debt skyrocketing as it is, in order to get minimal gains?
(This all assumes that the Keynesian approach works. IMO actually it does to some extent; however with many very-difficult-to-measure penalties, beyond of course the obvious debt itself.)
Year Unemployment rate
1923-29 3.3
1930 8.9
1931 15.9
1932 23.6
1933 24.9
1934 21.7
1935 20.1
1936 17.0
1937 14.3
1938 19.0
1939 17.2
1940 14.6
1941 9.9
1942 4.7
Doesn’t Keynsian believe that you save in good times and spend in bad times?
We have been spending in good times and want to spend more in bad times. Don’t know how this is going to work.
“We have been spending in good times and want to spend more in bad times.”
You hit the nail on the head Basura. This is why I get so upset with all the “spend our way out of recession” talk. The Keynesians never come forward to say “it’s time to turn off the spigot” after the “crisis” is over. It’s just spend, spend, spend all the time, no matter the circumstances.
I wish I could run my household finances the same way. Can someone send me a printing press for my birthday? Would be much obliged.
Politicians who run up debt during the good times can’t claim to have Keynesian theories behind them. They have no noteworthy economic foundation. I wish there were more people who would call the pols on this.
Doesn’t Keynsian believe that you save in good times and spend in bad times?
That’s the theory. However (as discussed last week):
“In theory, there’s no difference between theory and practice. In practice, there is.”
(attributed at various times to many people, including Albert Einstein and Yogi Berra)
“The map is NOT the terrain.”
LOL - yep. What movie was that? Saving Private Ryan?
The expression “the map is not the territory” first appeared in print in a paper that Alfred Korzybski gave at a meeting of the American Association for the Advancement of Science in New Orleans, Louisiana in 1931.
-Wikipedia
Also a common WWII saying.
This time we’ve jumped about the same amount in terms of debt (70% to 85% of GDP), but have only served to flatten unemployment, not reduce it significantly at all
The reason is that most of the bailout money has gone to a small # of people.
Creating jobs increases the velocity of money, confidence,spending and taxes. Bailing out gamblers and banks only makes a small # of people rich. Banks are still hoarding money, many of those with cash have kept their money in moneymarkets and aren’t spending. We should have done away with TARP and unemployment and just created jobs. That should have been job #1.
We’re a 75% consumer driven economy where the PTB have decided the consumers are overhead.
Yes, we’re doomed.
Chevron cutting 2,000 jobs in refining restructuring.
NEW YORK (MarketWatch) — Chevron Corp. said Tuesday it plans to cut 2,000 jobs this year as part of an effort to realize savings in its refining operations, as the oil major signals that recent woes in the business of making gasoline and diesel fuel will persist well beyond 2010.
Chevron also plans to solicit bids for operations in Europe, including its Pembroke, Wales, refinery, as well as the Caribbean and select Central America markets. It’s also reviewing operations in Hawaii and Africa, outside of South Africa.
Chevron will then hire those same 2000 as lower paid contract workers.
As someone who lives in the energy capital of the world and has worked in or visited the largest refinery operations in the world, I can tell you they are already operating with the least amount of personal they can.
German corporate bankruptcies up 15.5 percent on year in December; 11.6 percent in 2009 ~ Tuesday March 9, 2010
BERLIN (AP) — German corporate bankruptcies rose in 2009 for the first time in six years, with filings up 15.5 percent on the year in December in the wake of recession, government data showed Tuesday.
The Federal Statistical Office said 2,583 companies filed for bankruptcy protection in the last month of 2009.
The year-on-year increase compared with a smaller 6.9 percent rise in November, but was in line with big increases in the two previous months.
Corporate bankruptcies were up 11.6 percent for the whole of 2009 over the previous year, with a total of 32,687 bankruptcy filings registered.
That was the first time since 2003 that the number of companies going bust rose from the previous year, the statistical office said. Overall, bankruptcies still fell short of the 2003 total of 39,320.
Sorry if it was posted earlier.
Diana Olick describes the situation perfectly in Mortgage Principal Writedown Won’t Save Housing.
And so it begins. Big gun lawmakers are making the move toward principal writedowns as the last resort to save the housing market.
The problem is prices. Home prices have fallen so far in the hardest hit areas, the areas where the bulk of the troubled loans are, that banks would have to write down principal 30 to 50 percent to put borrowers back in the green. Accounting rules require that banks write down the value of those loans on their books, and experts tell me that if banks really accounted for all the losses in the home loan market, they’d all be insolvent.
That’s why the Obama Administration has created this kind of shell game in the first place.
I stole that shell game idea from housing consultant Howard Glaser: “We’re spending tens of billions of dollars on a tax credit to get people to purchase homes, we’re spending federal money to keep them in their homes through the modification program, and now we’re going to pay them to move out of their homes. This is not a sustainable system for the housing market. It’s a shell game. Bernie Madoff could have created this system,” Glaser told me today.
“experts tell me that if banks really accounted for all the losses in the home loan market, they’d all be insolvent”.
Everyone must know this, but pretending there are no losses is part of going along with Too Big To Fail. It goes something like: “If they fail, our system fails….armageddon…need to print money…bailouts… lets say Bernanke is man of the year.” Hostages we remain.
“experts tell me that if banks really accounted for all the losses in the home loan market, they’d all be insolvent”.
Why would they be insolvent? Did not TARP and the bail-outs and the Fed and Treasury, and GSE’s “buying” toxic assets solve this problem?
So far, as a guess, what percent of the total problem was “solved” by the current total of bailouts and guarantees? 10%? 80%?
Rather than saving the old banks, would it be cheaper to create new ones? That way you’re not filling in a hole before you start building a hill. But it’s largely the rich and powerful who own most of the bank stocks, and have more than the FDIC limits in deposits. So that’s just not going to happen.
I’m not sure about cheaper but it would do away with moral hazard. You could reward those banks that had controlled risk the most and let the rest fail.
IMHO ,it was a stupid game to begin with . Letting the cards fall the way they should based on standing law at the time would of created a reconstruction of the systems . I believe the losses would of been spread out more rather than this throw it on the backs on Main Street . Can’t have the upper upper suffering .
Eaton Vance Dumps Dirt Bonds as Florida Land Districts Default
Muni bond player decides to cut and run. Getting 27 cents on the dollar rather thatn foreclosing on increasingly defaulting bonds. The ones mentioned here are development properties (dirt) in JAcksonville FL.
http://www.businessweek.com/news/2010-03-09/eaton-vance-dumps-dirt-bonds-as-florida-land-districts-default.html
KB Home offers pre-wired homes for electric car owners
San Jose Business Journal
KB Home said Tuesday it will begin offering an option to pre-wire its new Built to Order homes to accommodate charging stations for homeowners’ electric vehicles.
Los Angeles-based KB (NYSE:KBH), one of Silicon Valley’s biggest home builders, said the option is designed to ease the future installation of a station to charge an electric or plug-in hybrid vehicle conveniently at home.
California has the highest percentage of plug-in hybrid cars registered in the country, accounting for more than 20 percent of all Toyota Priuses sold.
“It is critical for the mass adoption of electric vehicles to have companies like KB Home leading the industry by offering this pre-wire option, as the majority of electric vehicle charging will be done at home overnight,” said Matt Mattila of the Rocky Mountain Institute.
What’s that cost - about $200? Nice benefit.
(presuming that it’s essentially just a 220V outlet in the garage)
Well, I was the Art volunteer in 2nd grade today, nearly missed my “court appointment” with ChartBoy… (packman)
(Least you think ol’ Hwy isn’t a good sport about “serious” things packman…
This is how I deal with my: “duck, dodge & weave” Siblings at thanksgiving as well, with a good red red wine of course, on that note, enjoy…Mr.Cole might even enjoy it…)
Bailiff Linus (speaking loudly):
“Hear YE! Hear YE! ALL rise…the Court is now in session!”
“The somewhat Honorable Judge Lucy presiding!”
Lucy (pounding gravel) : “Order-in-the-court! Order-in-the-court! Order-in-the-court!
This case deals with,…blah,blah, the party of the 1st party claims that…blah,blah, blah,…the party of the 3rd party says that…oh finally, here it is, …the case:
The Defendant referred to as “ChartBoy” AKA, (packman) who is represented by his “officer-of-the-court” Sally, makes the following claim:
TO WHIT:
“So the all time record in home prices, when adjusted for inflation, was hit June of 2000 - five months before Cheney-Shrub were elected.”
The Planitiff (Hwy50) who is represented by his “officer-of-the-court” Snoopy, makes the following counter claim: “You Lie!”
Judge Lucy: “Does the Defendant have any evidence to support his claim”?
(Sally hands Judge Lucy) a large poster:
http://img20.imageshack.us/img20/1412/graphhousingcaseshillera.jpg
Judge Lucy: “These numbers on the bottom are kinda small, looks like they reference the years: 1900 thru 2010… is that correct Sir”?
Sally: “Yes, your honorable kind hearted illustrious Judge Sir”
Judge Lucy: Well it appears that the (all-time historic high house prices- adjusted for inflation) is in the year…(Liaryer Sally suddenly interrupts…)
Sally: “Uhm, …your honorable kind hearted illustrious Judge Sir, I can see that your having trouble with those very small dates, here let me provide you with an even BETTER chart of that data so that you can clearly see THE TRUTH in my clients assertion,…here your honorable kind hearted illustrious Judge Sir:
(Sally Hands Judge Lucy and even bigger Chart):
http://img707.imageshack.us/img707/5936/graphcaseshillerpricest.gif
Judge Lucy: “Oh, why yes,… this is much larger…and your right, this chart cleary shows that the PEAK in prices occurred BEFORE Bush/Cheney took office… looks like 7 months BEFORE the year 2000…as your client has stated with his own lips under oath”
Judge Lucy: Very well then, that’ll be all, …OK, Officer Snoopy…does the Defendant have anything to support his assertion that the the Plaintiff’s STATEMENT-OF-FACT is “untrue”?
(Hwy50 suddenly stands up): “ChartBoy LIES!” (Sudden outburst of noise & confusion in the courtroom)
Judge Lucy (pounding gavel): “Order-in-the-court! Order-in-the-court! Officer Snoopy, you will restrain your client immediately…Bailiff Linus, anymore outbursts and chain them both to Snoopy’s dog house!
Judge Lucy: “Officer Snoopy do you have any EVIDENCE to counter ChartBoy’s stated claim”?
Snoopy: “blah,blah,blah…#!*%#!… blah,blah,blah…#!*%#!… blah,blah,blah…#!*%#!”
Judge Lucy: “Court Reporter (Woodstock) readback what he just said…What?, he wants me to look at the 1st Chart offered as evidence by ChartBoy? Why?..it contains the TRUTH, THE WHOLE TRUTH & …NOTHING BUT THE TRUTH?
Sally: “Uhm, …your honorable kind hearted illustrious Judge Sir, my client would like to remind you that he is an upstanding member of the “TruePurity™” party that your parents both belong to and also, there’s a “TrueAnger™” PeeParty tea toadlers tomorrow evening beginning at 7pm and…
(Judge Lucy pounds her gavel):
Judge Lucy: “Officer Sally..would you quit blabbering on…I’m try to read these numbers…uhm, looks like the chart PEAKS right about in the year…
(ChartBoy jumps up from his chair YELLING:)
ChartBoy: “Quick everyone!… look… look out the window: It’s the Incredibles! And they’re naked!”
(Judge Lucy pounds her gavel):
Judge Lucy: “Order-in-the-court! Order-in-the-court! Order-in-the-court!
Sally & ChartBoy (Jumping up and down in joy, yelling): “We’ve won! We’ve Won! We’ve Won!”
Judge Lucy & Woodstock (puzzeled looks): “What”?
Sally & ChartBoy (still jumping up and down in joy, yelling): “We’ve won! We’ve Won! We’ve Won!”
Snoopy: “blah,blah,blah…#!*%#!… blah,blah,blah…#!*%#!… blah,blah,blah…#!*%#!”
Judge Lucy: “Court Reporter (Woodstock) what did Officer Snoopy say”?
Woodstock: “He said that ChartBoy is a… #!*%#! & a syphilis lipped puss pocked slimy toad!”
Snoopy: BWAHAHHAHAHAHHAHAHHAHHAHAHAHHHHHHHHHHHHH!!! (fpss™)
Hwy 50: BWAHAHAHicHAHAHicHAHAHAHAHicHAHAHic* (DennisN™)
Judge Lucy (pounding the gavel vigorously!): “Hwy…you’re such a BLOCKHEAD!” …The Court finds you in CONTEMPT!” …ChartBoy, the court finds you GUILTY & all your blah, blah, blah,.. “TrueHaskell™” = “But, but, but…” blathering aside…it further finds that you did willfully (but possibly without malice)…lead astray, misguide, misdirect, misinform, deceive, delude THE FACTS in order to accomplish a rather devious plot of propaganda in to support your FALSE claims using the Case-Shiller chart entered into evidence.”
Judge Lucy(pounding gavel loudly!): “Case Dismissed! ..uh,…wait Officer Sally & Officer Snoopy, each of your clients owes me..uhm, I mean, owes the Court 15 cents apiece, in cash…this case has given me a headache & I need a bubblegum flavored snow-cone asap…pay up…NOW!”
Clerk Marci reads out loud legal description addendum:
Marci: “Deception…
Deception is the act of convincing another to believe information that is not true.
Deception involves concepts like propaganda, distraction and concealment. Fiction, while sometimes manipulative, is not a deception unless it is portrayed as the whole truth; not to be confused with half-truths.
In many cases it is difficult to distinguish deception from providing unintentionally wrong information. One of the reasons for this is that a person or an entire organization may be self-deceived.”
foederis pax pacis (Formal agreement for Peace & Harmony)
Sheesh HWY..I’m bad but your mom might need to cut back on your daily ration of Flintstone vitimans and Cocoa Puffs.
Ha ha ha
it’s bush/ cheney’s fault!
Thousands of Physical Therapists are Closing their Doors
(PRWEB) March 9, 2010 — Thousands of patients around the country have to discontinue their Physical Therapy treatments because they cannot afford to pay their sky-rocketing co- payments. Especially in this diffucult and uncertain financial environment insurance co-payments that exceed $40, $50 or even $60 per visit make almost impossible for people to afford two or three Physical Therapy sessions per week. Insurance companies by increasing the co-payment obligation to the patient, end up paying less to the providers and reap greater profits.
In a recent interview Dr. Dimitrios Kostopoulos, co-founder of Hands-On Care Physical Therapy stated “Despite the fact Physical Therapists are the front line providers for musculoskeletal problems, they are considered by insurance companies as “specialists” and fall under the “specialist” high co-pay schedule. Such a high co-pay schedule prohibits thousands of patients from receiving Physical Therapy services prescribed by their physicians”.
I think that this “can’t afford it” virus is going to hit the health care industry very hard.
As I’ve mentioned here before, I’ve been on a bit of health care cost-cutting kick. Cut out two doctors in favor of one physician assistant. I’ve found the PA’s services to be first-rate, and the office staff is a lot more courteous than what I used to deal with at the doctors’ offices. Since PAs practice in association with MDs, I’ll be referred out if something mean and nasty is found.
And, since I stopped seeing Dr. Pricey, I’m getting my dental care through a community college dental studies program. Since most of what I need from a dental exam is a good look-see and a cleaning, this arrangement works quite well. Haven’t had a cavity in many moons, and, if the dent-studies people spot one, they’ll refer me out.
I ’spect that I’m not the only health care cost-cutter out there.
More Americans Can Call Themselves Millionaires, Study Finds.
March 09, 2010 ~ FOX NEWS
The number of Americans who can call themselves millionaires has gone up in the past year, according to a report released Tuesday by Spectrem Group.
The number of U.S. households with a net worth of at least $1 million, not including primary residence, increased 16 percent to 7.8 million in 2009, according to the group’s press release.
The number is up from 6.7 million in 2008. That follows a 27 percent decline in the millionaire population in 2008.
The number of households with a net worth of at least $5 million, known as Ultra High Net Worth households, surged 17 percent to 980,000 in 2009.
“The nation’s millionaires – together with its Ultra High Net Worth households – are bouncing back from the recession. Following a sharp decline in 2008, both groups saw their numbers advance nicely in 2009,” said President of Spectrem Group George H. Walper, Jr.
The broader affluent population, with a net worth of at least $500,000, also increased in 2009. This population increased by 12 percent to 12.7 million.
More Americans Can Call Themselves Millionaires, Study Finds.
I would be very happy about this if all boats were rising on a rising tide.
It’s a good thing they have a lot of that money safely stowed in the trusty hands of Wall St. Wall St. won’t ever let them be thousandaires again - they promised so.
Ha, the folks over @ AIG & GoldenamnSucks are having a hoot over this Main St. vs Gov’t debt dilemma:
Defaulted Loans May Haunt Seniors:
by Ellen E. Schultz WSJ
Monday, March 8, 2010
“But a provision in the 2008 Farm Bill lifted the ten–year statute of limitations on the government’s ability to withhold Social Security benefits in collecting debts other than student loans—for which the statute of limitations was lifted in 1997—and income taxes, where the limit remains 10 years.”
A Treasury spokesman says the new legislation “allows Treasury’s Financial Management Service to collect older debts and levels the playing field so that all eligible debts, regardless of age, are subject to debt collection. Treasury expects this legislation will result in increased collections of $10 million per year in delinquent federal non–tax debt.”
Though no one argues that people shouldn’t repay their debts, the change is coming at a challenging time for older Americans already pinched by mortgage woes, pension cuts and spiraling medical costs.
The shift applies to debtors of all ages, but Social Security recipients will bear much of the brunt. A Wall Street Journal analysis of Treasury Department data shows that Social Security recipients comprise a large and growing percentage of people from whom the Treasury recovers debts.
Just like the changes they made in bankruptcy law right before the crash, this type of change tells you where they believe things are going, and that’s down. They wouldn’t make these under the cover of darkness changes if they thought things were going to pick up.
Ex post facto.
Who says the Constitution isn’t dead?
An update on my sis, the involuntary slum lord…….
Back in 2006, she swore on a stack of Bibles that her nothing special about it, 3/2/2 “Stucco Slice of Heaven” was worth $700-800K, and how she was going to sell it when it hit a million, put the kids thru college and retire on the proceeds.
Last year, she was going to sell it to a friend/neighbor, who was going to immediately walk away from their current mortgage/house. That plan evidently fell thru…….
Listed the house again a month or so ago. Got an offer for “asking price” (whatever that is, nobody is saying) almost immediately. ( I lost her Cali address, so I can’t check the MLS)
But…….the word came down last week that the buyer could not get financed, because of a “surprise” IRS judgment of $20-$30K against the buyer.
I can only say it’s strange that we aren’t hearing more about the details of these attempts at selling, vs. 2006.
One might suspect that her Real Estate “Investment” is under-performing.
Everyone had a dot-com story, and many who post here have myriad housing bubble stories as well.
Therese Poletti’s Tech Tales
March 8, 2010, 2:14 p.m. EST
Everything was so over the top
Commentary:
- Weirdest memories of the bubble
- Dot-com fallout still haunts IPOs, startups
- Cisco hype seems to work with investors
By Therese Poletti, MarketWatch
SAN FRANCISCO (MarketWatch) — Cirque du Soleil performers turned somersaults and teetered on stilts while crowds lined up outside a gallery space, somewhere in the South of Market district of San Francisco.
But God help me, I cannot tell you who hosted the party. I had to look it up — Respond dot com. Remember them?
Me neither.
That little bash in November 1999 for the now-defunct company cost around $200,000. That was chump change for businesses flush in venture capital during the bubble. “Get big fast” and the laughable “first-mover advantage” were the mantras of every Internet startup, led on by their lemming VCs, chasing one bad idea after the other.
I’ve compiled some of the weirdest memories of the bubble and bust. Feel free to chime in with your own; everyone had a dot-com story.
…
Looks like somebody had five martinis at their three martini lunch.
It wath only thour, I thwear!
Pass It To Find Out What’s In It.
Nancy Pelosi to the 2010 legislative conference of the National Association of Counties today: In regards to the “health” care bill:
3- 9 - 2010
“It’s going to be very, very exciting. But we have to pass the bill so that you can find out what is in it, away from the fog of the controversy”.
“You’ve heard about the controversies within the bill, the process about the bill, one or the other. But I don’t know if you have heard that it is legislation for the future, not just about health care for America, but about a healthier America, where preventive care is not something that you have to pay a deductible for or out of pocket. Prevention, prevention, prevention—it’s about diet, not diabetes”.
~ Madam Moonbat Pelosi
health care for America, but about a healthier America, where preventive care is not something that you have to pay a deductible for or out of pocket. Prevention, prevention, prevention—it’s about diet, not diabetes”.
Man! What a nut-ball!
I know, it makes perfect sense to sign on to something when you have no idea what it is.
Of course when many folks are lead to believe “they” are going to stick it to the big ins. companies they can’t wait. A whole lot of people are in for a big disappointment.
I know, it makes perfect sense to sign on to something when you have no idea what it is.
No, that part doesn’t make sense. But I bet the health insurance lobby knows “what’s in it”. I think they wrote most of it.
I’m not a big fan of this “reform”.
David Weidner’s Writing on the Wall
David Weidner
March 9, 2010, 12:01 a.m. EST
No tea for Wall Street in fall elections
Commentary: Industry donations are flowing to incumbents
How Obamacare is killing financial reform
By David Weidner, MarketWatch
NEW YORK (MarketWatch) — Tea party? When it comes to elections, Wall Street traditionally has but one party of choice: the winning party.
Blaming the financial industry may be the only issue on which there’s common ground in Washington. The furor surrounding bailouts and government spending has ignited a whole anti-government movement that could tilt the scales come fall.
But that sentiment hasn’t swayed the industry from its longtime strategy of backing incumbents and frontrunners.
This pivotal midterm year is no exception. The banking and brokerage industries are going long on candidates playing roles in shaping financial reform. If the early contributions are any indication — and they usually are — the races may be closer than thought.
So much for throwing the bums out.
…
“So much for throwing the bums out”.
“Money talks and bullshit walks”
The banksters have owned D.C. for a very long time, nothings changed except they control congress, the F.Reserve and Treasury. Lock,stock and barrel now.
I’m sure they love team trillion dollar Barry and the unlimited express.
I’m just hoping whining Harry Reid gets sent back to porch light Nevada!
“Its longtime strategy of backing incumbents and frontrunners.”
This is a very important concept that one must keep in mind whilst in the middle of partisan crossfire at parties, dinners, etc.
I was once, er, moderating a discussion about which networks were owned by whom and who gave the most money to which candidate. After spending some time at opensecrets.org, it was clear to me that it didn’t necessarily follow that a company’s (or industry’s) perceived political persuasion dictated where the money flowed.
What seemed more important, OTOH, was who was more likely to win that particular election and thus be better able to potentially kick back the contribution in the form of political favors…especially if the candidate and industry leaders were politically opposed.
It’s GOOD to be the Banksta!
Celebrity Resorts files for Chapter 11 bankruptcy protection
Orlando Sentinel March 9, 2010
Celebrity Resorts LLC and its affiliates have filed for Chapter 11 bankruptcy protection, listing tens of millions in estimated liabilities.
The Orlando-based time-share company listed just two unsecured creditors, International Escrow Services of Atlanta and Resort Condominiums International of Carmel, Ind. But about three dozen other filings, including Celebrity Resorts of Orlando LLC and Celebrity Resorts of Lake Buena Vista LLC, listed pages of additional creditors.
In the bankruptcy filings, the company’s chief executive officer, Jared Myers, said he is owed $680,812 in unpaid compensation. A lawyer for the company could not be immediately reached for comment.
Bowles Says Deficits Will Make U.S. ‘Second-Rate’ (Update2)
March 9 (Bloomberg) — Erskine Bowles, co-chairman of the commission on U.S. deficit reduction, said entitlement programs such as Social Security will turn the nation into a “second- rate power” if their costs aren’t reduced.
“We’re going to mess with Medicare, Medicaid and Social Security because if you take those off the table, you can’t get there,” Bowles said today in a speech to North Carolina bankers. “If we don’t make those choices, America is going to be a second-rate power and I don’t mean in 50 years. I mean in my lifetime.”
President Barack Obama created the commission last month, and named Bowles, 64, former Clinton White House chief of staff, and former Wyoming Republican Senator Alan Simpson, 78, to lead the panel. The commission’s recommendations to bring the budget deficit down to 3 percent of the economy by 2015 are due Dec. 1.
Yep more pain for the middle class and upper middle class in order to bail out the gambling produce nothing wall street elite.
Maxon Furniture to close Salisbury plant
Charlotte Business Journal ~ March 9, 2010
Maxon Furniture Inc. will close its plant in Salisbury, permanently cutting 132 jobs.
According to a company filing with the N.C. Department of Commerce, most of the layoffs will occur between May and November.
A company spokeswoman says Maxon is closing the plant due to excess capacity in a weak economic envirnoment. Affected employees will receive severance packages.
Maxon Furniture sells cubicle workstations, free-standing desks and office chairs. The company is based in Seattle.
Astorino spending cuts: Lay off up to 1,600, close Croton pool, cut NYC buses, delay Playland opening
WHITE PLAINS, N.Y. — Westchester County Executive Rob Astorino said today that a “staggering” fiscal crisis will force the county to shutter the Croton Point Park pool, delay the daily opening of the Rye Playland amusement park and end bus service to New York City.
The measures are part of a plan for drastic cuts in government spending, which could also mean “likely” layoffs for as many as 1,600 county workers if spending can’t be cut in other ways.
Astorino said the cuts are necessary due to a projected $166 million budget gap next year, far above the $60 million deficit he was told he inherited when he took office in January.
He called the actual deficit “staggering,” and called it the result of “unrestrained spending for many years” in the county.
There’s 3,140 counties in the U.S. - each one will be undergoing its own little version of this. Some will be OK, others will be BK.
I Kant believe this conundrum will be an easy one to fix…
The Financial Times
The eurozone crisis is a nightmare for Germany
By Martin Wolf
Published: March 9 2010 20:02 | Last updated: March 9 2010 20:02
Ever since the federal republic was founded, Germany has had two over-riding strategic objectives: sound money and European integration. These were the twin imperatives learned from the calamities of the early 20th century. The euro embodies these aims. Now they conflict with each other.
Is the right answer to rescue sinners, thereby strengthening the cohesion of the eurozone, but threatening monetary stability? Or is it to let sinners default, thereby strengthening monetary credibility, but weakening cohesion? Germany could avoid such choices before the single currency: uncompetitive countries simply devalued.
Unfortunately, the domestic German debate assumes, wrongly, that the answer is for every member to become like Germany itself. But Germany can be Germany – an economy with fiscal discipline, feeble domestic demand and a huge export surplus – only because others are not. Its current economic model violates the universalisability principle of Germany’s greatest philosopher, Immanuel Kant.
…
Merkel calls for urgent CDS clampdown
By FT Reporters
Published: March 9 2010 19:12 | Last updated: March 9 2010 19:12
Germany and France are stepping up the pressure for urgent action by the European Union to regulate speculation in sovereign debt markets, in the wake of the Greek debt crisis.
Angela Merkel, German chancellor, called on Tuesday for the “fastest possible” adoption of new rules to clamp down on the most speculative elements of derivatives trading, including so-called naked transactions, which do not hedge the value of real assets.
Speaking after talks with Jean-Claude Juncker, the Luxembourg prime minister, and chairman of the Eurogroup of finance ministers from the eurozone, she said: “We are all agreed that we must put a stop to financial speculation.”
…
Not everyone seems all that enthralled with financial innovation these days…
I had a discussion with some folks on another message board about this the other day. CDS’s are just inherently bad. Theoretically the concept is merely insurance - however the problem is that it’s bought and sold by third and fourth parties.
True insurance is a valid and proper thing. You’re taking out protection against something bad happening - essentially you’re making a bet that that something bad will happen, and the insurance company is making a bet that it won’t happen. The key is though - your part of the bet is (or is supposed to be) more than offset by your innate desire for the bad thing to not happen. E.g. with life insurance - the benefit of payout to your family is more than offset simply by your desire to live (which is why suicide normally isn’t covered, since that offset doesn’t exist then).
Imagine however selling your life insurance policy to someone else. That person now has a vested interest in you dying, with no interest in you living. That’s a bad thing.
(Exception is viatical settlement - where sometimes someone *does* sell their life insurance policy to a third party. However this is normally only after the seller finds out they’re most likely going to die of some disease, and would like the money for medical treatment. This was common for AIDS patients in the 80’s. As such - this is a valid exception, with no parallel in the financial world, that I know of anyhow.)
Still not certain this is the best of all possible worlds we live in…
The Financial Times
Big bank oversight to stay with Fed
By Tom Braithwaite in Washington
Published: March 7 2010 22:30 | Last updated: March 7 2010 22:30
Banks with more than $100bn of assets will be overseen by the US Federal Reserve under a regulatory reform plan that represents a partial victory for the central bank after months of attacks in Congress.
Chris Dodd, the Senate banking committee chairman, had proposed hiving off all bank supervision to a single regulator but is set to propose this week that the 23 largest institutions stay under the Fed’s oversight, according to people familiar with the plans.
…
This week also saw the banking associations come out firmly in favour of the Fed, deluging the banking committee with letters and phone calls. Independent Community Bankers of America, the Financial Services Roundtable and the American Bankers Association are among the groups to have lobbied senators in co-ordinated communications.
Senators who remain sceptical of the Fed’s handling of the financial crisis and oversight of institutions in the preceding years do not want the Fed to retain all of its supervision but are coming under heavy pressure, according to aides.
“The Fed feels it is gaining some momentum,” said one.
Yep
Big banks get special regulation that can’t be audited.
Small banks will continue to get squeezed out.
Next up outlaw individual lending.
Then do away with cash, everything electronic.
Then do away with any pretense that all your work and productivity belong to Wall Street FED.
I suspect most of those banks do everything the FED tells them too. They believe in teh don’t fight the FED mantra and for good reason.
The Financial Times
Techs reflect on decade since dotcom boom
By John Authers and Michael Mackenzie in New York
Published: March 9 2010 17:47 | Last updated: March 9 2010 20:37
In January 2000, 17 dotcom companies paid more than $2m each to advertise during the Super Bowl, the season-ending national championship game for American football.
For anyone looking for the symbolic moment when an investment bubble led to excesses that were plainly unsustainable, that was it. Just a few weeks later, on March 10 2000, the barometer of dotcom mania – or what was the technology and telecom bull market of the 1990s – the Nasdaq Composite, closed at a high of 5,048.62.
…
Between 2000 and 2002, the S&P 500 lost 9.1 per cent, 11.9 per cent, and 22.1 per cent in successive years. Most mutual funds followed the index downwards. Meanwhile, hedge funds (as measured by Hedge Fund Research, a big Chicago-based research group) gained 4.98 and 4.6 per cent before succumbing to a small loss of 1.45 per cent in 2002.
Only relatively wealthy individuals can invest in hedge funds, so there was no big flow directly from mutual funds. But big investment institutions, also burned by the Nasdaq crash, noticed the success of hedge funds and started to pour money in. In 2002, more than $99bn came into the hedge fund industry, according to Hedge Fund Research, at the same time that small investors, shaken by the market falls, were pulling a net $24.7bn out of mutual funds.
The number of hedge funds also proliferated. In 1998, when the near-meltdown of Long-Term Capital Management briefly appeared to have inflicted critical injuries on the sector, there were 3,325 funds; by 2007 there were more than 10,000.
In 2005, after four years of persistent inflows, the entire hedge fund industry was worth more than $1,000bn for the first time. Two years later the industry’s assets would peak at more than $1,800bn.
However, this probably understated hedge funds’ influence, thanks to another effect of the Nasdaq crash. Hedge funds also benefit from their ability to use leverage. Trades that are barely worth making become very profitable once they have been leveraged up many times over with borrowed money.
The Federal Reserve’s reaction to the Nasdaq crash made it much easier to obtain leverage. Heedful of the economic pain that had followed the bursting of previous big investment bubbles, in the US in 1929 and in Japan in 1990, the Fed decided to cut interest rates aggressively. It did this even though much of the economy was relatively unaffected by the dotcom sector’s problems, and the effect was to make it far easier to borrow money for speculation - whether to run a hedge fund or to buy a house.
Thus hedge funds’ real buying power was multiplied several times by leverage, and they came to drive stocks and other asset classes, on a daily basis. The patterns of trading that ended with the global crisis of 2007-09 all arguably had their roots in the fall-out from the dotcom crash.
LTCM should have served as a warning. Instead, the Bankstaz©®™ saw it as a lesson. A lesson that the feds would bail them out as well.
They are really starting to tell the real story at the Financial Times. The one essential ingredient which is missing from this article: A full disclosure that markets are still FUBAR.
…
This was a bubble as insane as any in history. “It was a time when the rules of investing made no sense and as much as people liked to think things had changed with all the talk of a new industrial revolution, it was shown they do not,” said Anthony Conroy, head of trading at BNY ConvergEx.
The mania was apparent in the run-up to the Nasdaq collapse, when individuals gave up steady jobs to become “day traders” in the hope of making fortunes from soaring shares. That particular road to riches came to an abrupt halt and the role of individual traders in the stock market has been much more marginal ever since.
The bursting of the bubble had a huge impact on the business of financing technology start-ups. But it went much further than that. Arguably, the dotcom boom ushered in the historically low interest rates from the Federal Reserve that are now widely blamed for allowing the housing and credit bubbles. It also paved the way for lightly regulated hedge funds to succeed mainstream mutual funds as the critical drivers of the market.
The bubble itself was largely driven by what the former Fed chairman Alan Greenspan called “irrational exuberance” – increasing investment by retail investors in stocks, either through mutual funds or through fledgling internet brokerages. Many of these investors, egged on by widespread television advertising, only entered near the top of the market and suffered severe losses. This dented the market influence of mutual fund managers.
“I don’t think we have ever seen such a point when so many people from Main Street were involved in the market to that degree,” says James Paulsen, chief investment officer of Wells Capital.
…
‘The bubble itself was largely driven by what the former Fed chairman Alan Greenspan called “irrational exuberance”…’
Irrational exuberance in turn was and remains largely driven by plenty of nudges from the Fed and top economic policy makers in the U.S. government, most recently in the form of MBS purchases to grind mortgage lending rates into the floor coupled with the $8K tax credit to beat fence sitters into making a home purchase.
How much of the new money flowing into the top end of the housing market comes directly from Megabank, Inc, facilitated by zero-percent financing from the Fed, not to mention the taxpayer-funded Wall Street bonus money which may be seeking a new home?
* The Wall Street Journal
* MARCH 9, 2010, 1:14 P.M. ET
Barron’s
10 Best Places for Second Homes
By STEVEN M. SEARS
At long last, the market for luxury real estate is coming back to life.
Prices for primary residences, which plunged at least 20% from the peak in 2007, appear to have bottomed. In some of the snappiest locations, scattered bidding wars are breaking out and prices are turning upward.
In Greenwich, Conn., realty brokers say, the final months of 2009 were almost record-setters for sales volume, as two years of pent-up demand was unleashed. Even the megadeal is back. In Beverly Hills, film producer Jeffrey Katzenberg just plunked down $35 million for an 8,700-square-foot home on six acres.
There’s nothing like a stabilized economy and a huge rebound in stocks to send folks looking for the perfect manse. The return of hefty Wall Street bonuses hasn’t hurt, either.
With all that in mind, and with summer just around the corner, Barron’s sized up the market for upscale second homes, one of the greatest luxuries of all. We scoped out dozens of deluxe enclaves across the country, speaking with brokers, homeowners and others.
Prices are way down–40% off the peak in some locations. Seemingly at or near bottom, they are starting to attract the first wave of bargain hunters–and not just families in need of R&R. Hard-nosed investors also are on the prowl, says Jan Reuter, head of residential real estate at U.S. Trust Bank of America Private Wealth Management: “We’ve seen an uptick in buying in just the last couple of months.”
…
Bah. Let them buy up non-performing assets and eat the upkeep and taxes.
Then again, perhaps my other prediction is going to happen. 15k tax credit along with penalty free 401k withdrawls for home purchases?
That with a tax increase.