Bits Bucket For June 9, 2010
Post off-topic ideas, links and Craigslist finds here. The Texas/Florida/DC meetup link at the forum is here. Click here for the shadow inventory thread.
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Some great comments yesterday from the best petition sign-up so far. Let’s keep the momentum going. Remember, you have to click on the link in the verification email you’ll receive. Please pass it on!
‘I’ve waited for 5 years and still can’t afford a place in a safe area. I am educated and not a slacker. Something is wrong with this picture. Stop helping slackers and crooks!’
‘The shadow inventory needs to be eliminated and these homes need families living in them. These home are fast becoming a blight and nuisance in to the communities. The government is continuing to perpetuate a ongoing fraud and this needs to stop.’
‘In the early 1980s the Hunt brothers cornered the silver market. Today banks are cornering the housing market. In both cases, prices have been kept artificially high. Smart people are staying out of real estate.’
‘Treat the disease not the symptoms. Break up the big banks and dismantle Fannie & Freddie by turning them over to the states based on percent of RE in each state.’
‘”Affordable Housing” means the Government shouldn’t be propping house prices up’
‘Why is the Federal government so afraid of free markets? What is wrong with having a large supply, forcing prices to come down so that housing will become more affordable and more people can own their own home? Isn’t that supposed to be the “Dream”?
‘If we let the market work freely housing will be affordable.’
‘If the taxpayers are keeping these companies afloat, I don’t want them hoarding depreciating assets thus costing the taxpayers MORE money down the road. Liquidate those houses and get the cash and losses on the books so we can see the real costs.’
‘The problem was the bubble. the solution is prices returning to normal. Let it happen.’
‘As long as the banks of this nation receive federal subsidies in the form of interest free loans from the federal reserve, it is the duty of the United States congress to eliminate the shadow inventory fraud these banks are currently perpetrating.’
‘Please help to make housing more affordable by eliminating those unfair and unpopular mechanisms which prop up prices such as the shadow industry’
‘Banks holding on to assets and bad loans 2, 3, 4 years after default makes me wary of investing my money. The sooner banks come clean with their shadow inventory and losses, the sooner we can recover.’
http://shadowinv.epetitions.net/
so, it’s my ISP MSN that is blocking the confirmation email…
Petition is good but the underlying fact as I think is very simple:
The Govt. doesn’t want prices to drop and will never let it happen as it is tied to the votes. RE is the strongest money base Americans have and if the Govt. let’s it drop, the ruling party will be ousted. It is not that the Govt. doesn’t know the solutions, the problem is there is “no will” to implement them. No one wants to lose power. And it gets more fuel from the lobbyists who twist facts for the welfare of big corportions whose profits are tied to it. The powerful very well know that it was a bubble and it was created. They want another bubble and will do anything to re-inflate RE.
And the same loose monetary policies have been transferred to all the G-20 nations through the G-20 summit. Almost all countries in G-20 have a major housing bubble. There is “no will” any of these nations to bring RE to sensible levels. Like China doesn’t want to raise rates as it will hurt their bubble.
All countries are mistaking Bubble for Growth which gets them to stay in power.The only way it can burst is soveriegn debt and default by htese countries otherwise they will keep borrowing/printing to keep it strong for many-2 years.
Very true, Martin.
We’ve also lost some traction as many of the people who were bubble-sitting in 2004-2007 have now bought as well.
The number of people who want to see affordable housing has shrunk considerably, IMHO.
When the number of people/entities who own property and mortgages so greatly outnumbers future buyers, the only thing we can “hope” for is a major dislocation in the credit markets. Right now, the global “powers that be” doing everything in their power to prevent that.
“The Govt. doesn’t want prices to drop and will never let it happen as it is tied to the votes.”
If they had the power to ‘never let it happen,’ why did they already ‘let it happen’ then?
They tried their best to keep it propped up. Some factors like unemployment, people defaulting etc. were out of their control. But they are trying hard to keep prices up and re-inflate the bubble.
‘The Govt. doesn’t want prices to drop and will never let it happen’
‘why did they already ‘let it happen’ then?’
Can you answer the question?
‘Some factors were out of their control.’
Some factors like controlling the largest market the public participates in? If it were possible for governments to do this, china, for example, might use dictatorial forces to manipulate their property markets, make every person rich beyond their dreams, and become the most powerful nation history has ever seen.
Government can’t produce wealth, so they can’t do what you are suggesting. I’ve spent years leaning against this notion that govts, big corporations, powerful special interests and central banks are all powerful. I’ve become more convinced of their weakness every day.
It was a financial mania dude. No bubble has ever been sustained, because it can’t be.
Agreed.
I suspect people will be overpaying for housing for as long as any of us can see it… and that doesn’t factor in the dwindling job base and with it the ability to actually pay off a 30-year mortgage.
Even among my friends, one of them has gone from “housing is overpriced” to looking to buy a place at 4x his income (he’s single) and no warning seems to be having an effect.
One by one, people are giving up and accepting this idiotic new reality, where housing will stay grossly overpriced AND you may not have a job to pay for the place. But it’s all good because American Idol was on… Apple has a new iThing, etc… Whatever…
I just know if we all pull together we can get the debt to $20 trillion by 2015. Print baby, Print! We’re #1.
U.S debt to rise to $19.6 trillion by 2015.
WASHINGTON (Reuters) - The U.S. debt will top $13.6 trillion this year and climb to an estimated $19.6 trillion by 2015, according to a Treasury Department report to Congress.
If a govt official says $19.6 you can bet it will be at least $21.
But we’re all getting free health care. And I was promised nobody making under $250K will see a tax increase, so I’m not worried one bit.
How anybody thinks this isn’t inflationary boggles my mind.
It’s inflationary only if the amount of borrowed money can overcome the amount of money that will be destroyed.
Remember, there are many trillions of dollars of borrowed money and promised money that is destined to never be paid out.
Here’s the thing combo. With all this money being destroyed - who’s going to pay for all these new treasuries?
umm…at the end of the day, we will, just like those outrageous salaries at the Wall Street banks.
Wow. So FYI the CBO projection made just this past January was for the debt in 2015 (fiscal year end - Sep 2015) to be $17.45 Trillion. And now just 5 months later we’re up to $19.6 in our 5-years-out projection. And this is with an economy that is supposedly recovering.
Incredible. We are truly hosed.
Does anyone at all now doubt why gold is above $1,200?
I actually took advantage of the rally to sell my paper-gold (GLD) near the top ($122).
My gut is that we are still in more of a deflationary environment, and that this will be recognized more broadly . And I was frankly shocked at how little gold responded to the banking crisis back in ‘07/’08. I had expected that it would be a major beneficiary of all of the apparently-inflationary intervention.
Now I’m expecting that gold will do less well for a while as things tank again.
I’m hoping to buy again when it moves down some, but will likely buy physical instead of paper this time, though I can’t really articulate why. Maybe it is just that I am less trusting of the system after watching the last few years of obvious manipulation.
IMF Says Risks to Economy Have Risen ‘Significantly’
June 9 (Bloomberg) — Risks to the global economic outlook have “risen significantly” and policy makers have limited room to provide support to growth, International Monetary Fund Deputy Managing Director Naoyuki Shinohara said.
Most advanced economies are experiencing a “subdued” recovery, Shinohara said in a speech in Singapore today. “A key concern is that the room for continued policy support has become much more limited and has, in some cases, been exhausted.”
The various gov’ts, investors, analysts, hedge fund operators, crooks, thieves, and of course the Central Banks have all “priced in” a V-shaped global recovery. (”Priced in” means many things to many people. Try to be broad minded in interpreting that phrase.)
Are we really “in recovery”? An honest question: Can the world economy really recover without debt destruction? Can the US? How do ‘Consumers’ really consume without reduction in debt?
I think that we are having a defacto debt destruction by on-going “strategic defaults” in housing. This will not be considered nor calculated into the picture. I recently listended to Dick Bove claiming that the US Consumer is alive and well. Of course they are since they are not paying their house payments. It’s not a nice calculation. Too much messy reality involved.
Roidy
P.S. I want an energy policy, please.
P.P.S. Also, don’t be surprised if this blown out well is never really “capped.” It seems that there is oil leaking from the ocean floor itself. Nice.
There is no “recovery”. There is only spending by government of money they don’t have to support current spending. Increases in spending do not measure “growth”, just more spending.
We have complete imbeciles running the federal government. Bernanke, Geithner, and all the advisor clowns at the Whitehouse don’t know how to do anything but “stimulate”, meaning deficit spending from here to monetary collapse.
Bernanke recent comments that he doesn’t see a double-dip recession can assure us all the we are headed for a double-dip as soon as the current spending falls off.
Idiot Krugman, who should be running a hot-dog stand, rather than commenting in the NYT, is already calling from more “stimulus”, on the order of $200 billion more dollars. He says the austerity measures taken recently by the European community, while giving Geithner the finger, are baaaad for the economy. He is clearly a moron.
But, given the stupidity that overwhelms this administration, expect more “stimulus”, more deficits, more taxes, more government and, for sure, a deeper and darker depression coming your way.
Given Bernanke’s recent statements which can be used a reverse barometer with 89% accuracy, we are going into a double-dip.
Oh, happy day!
“Idiot Krugman, who should be running a hot-dog stand, rather than commenting in the NYT, is already calling from more “stimulus”, on the order of $200 billion more dollars”.
The idiot Krugman would want his hot dog stand subsidized if he wasn’t making a profit, and yes he is a completely disconnected moron.
“from here to monetary collapse”
( Why does that sound like the title to an epic saga? )
Starring Burt Lancaster, Ben Geithner and Cheech Marin!
with a special guest appearance by Moe, Larry, and Curley as Kudlow, Cramer, and Kneale.
“Risks to the global economy outlook have ‘risen significantly’ …”
Nah, the risks were there all the time, now they’re just being acknowledged.
Correct, combo.
Yep.
I see the NIKKEI 9,439.13 -98.81 is struggling.
The DOW is to run back up over 10,000 today according to some sock puppet on CNBC. “Way over sold” he squealed. “Need to hold above 10,000″ to keep up confidence in our recovery says another.
Why don’t the net works just use programed robots, or just run their comments in a closed loop, it would save them a lot of money.
“Why don’t the net works just use programed robots”
Sock puppets are more telegenic, if less intelligent.
They’re fighting for their jobs. If J6P’s 401k balance keeps declining then Joe will eventually lose interest in the financial media altogether. They’ve had it easy for 25 years.
Boy, I love sock puppets. I’d watch that.
Boy, I love sock puppets
Did you ever watch ‘Sifl and Ollie’ on MTV back circa 1999? Good stuff…
At least FNC uses Bisnobabes. May not be real intelligent (or maybe they are) but they are clearly easy on the eyes.
Are you talking about that guy with the Army issue glasses on CNBC? He is a known idiot.
Roidy
Not sure, I was at a neighbors house, over heard the news. We don’t have cable, so I miss all the important stuff the on CNBC money shows.
Stocks may rise today as BB is testifying. He will say all that would keep the market propped up. We may be well back above 10K.
One thing I don’t understand is when Greenspan was there,people used to believe him and now they know what he did to the country. Now when BB is here, people believe him. Maybe in a few years when he is not there, his policies will be exposed too. Investors just seem to look for hints to buy to keep the market propped up. I wish they all had a real job that adds value to the society and not create financially disastrous schemes with their MBAs.
“…they all had a real job that adds value to the society and not create financially disastrous schemes with their MBAs.”
Well, there’s something you can’t blame on the American Union wage workers!
Wall street is far more responsible for the death of our economy than union workers.
At least union workers produce things and provide services that are beneficial to our society.
Can’t really see anything beneficial coming from the FIRE industry. The sole reason for their existence is to take from the productive (including union workers!) and give to the lazy parasites (no, not “welfare moms” but rather the corporate/financial parasites that do far more damage to our society).
I often ask, “What union got a trillion dollar bailout?”
And don’t say “The UAW!” because they didn’t. GM did.
Looking to complete strangers for insight and guidance is the new black. Actually, it has been for a while - hence the boon for brokerages and the financial media and the “cult of the Fed”.
Funny, neither AG nor BB look like golden calves.
Seems that Dow 10K and S&P 1050 have become significant resistance levels. Everything I read from the market realists (some say permabears) is that if the market cannot break above and stay above 10,250 and 1100, a new leg down to the low 900’s on the S&P is inevitable.
It now appears that no amount of cheerleading by Uncle Ben or the MSM is going to move the market up, so I’m thinking we are due for another 10% or so down. That should be a decent buying opportunity for those with cash. Maybe 10% or 15% of upside from that level. Not likely to approach April 2010 levels for a long time (IMHO). But what do I know?
You don’t think we’ll ever test last years lows again? Seems odd to me that we’d bounce back up that hard and never come close again.
I don’t, I think that the last 200 points down on the S&P in ‘09 were panic and capitualtion. Worst case, I think is maybe 840, which is S&P earnings at $50 and a PE of 16. Absent some international dust up (always a possibility), I’m thinking 900 to 950 is a good target for the bottom.
But what do I know? Funduimentals have long since disappeared as the primary market driver.
these guys have a different view of “recovery” than I do. Recovery to me is “jobs.” That will sustain everything else, including the dow.
Pfffttt! Jobs are for the “little people” and are best offshored.
Isn’t it funny how other countries jealously protect their job bases and do everything possible to steal jobs from other countries, especially us?
Steal jobs? They’re not stealing jobs from us; We’re happily giving them away.
Remember the 2006 Citi memo that basically said our consumer driven economy no longer needs… consumers.
Really. You can google it.
Employment gets in the way of house hunting and shopping and will no longer be tolerated!
-Winston
these guys have a different view of “recovery” than I do. Recovery to me is “jobs.” That will sustain everything else, including the dow.
So by this definition then the economy was fantastic in late 2007, when unemployment was less than 5%? And in late 2000, when unemployment was less than 4% and at 35-year lows?
To the point - in my very strong opinion a healthy economy does include jobs - but also caveated that the jobs must be:
A. Producing things that are in real demand (e.g. not building houses that won’t be used for 10-15 years out until population catches up - or maybe even torn down before they’re even used; e.g. not hiring 16,000 new IRS auditors to add to bureaucracy; etc.)
B. Paid for by real money - i.e. not tons of newly-created money in the form of debt (private or public).
“until population catches up” LOL!
Given our rate of growth ( you may actually prove to be generous! ) I like where you’re coming from and I’ll make as much room on this soapbox as there are preachers.
Real Money. Real Growth. Real Jobs!
Still, in my mind, oxide’s point stands. If we allow the workforce to become atrophied (sp?) they might not even respond to shock therapy!
If we allow the workforce to become atrophied (sp?) they might not even respond to shock therapy!
Yep.
However it doesn’t help that people are paid to be unemployed, for I believe 99 weeks now.
packman,
Or Club 99 as it’s known in Oregon. Yeah, when it was determined I could no longer work in aircraft maint. in my unit, I wasn’t sent home ( and PAID ) until it was resolved.
At 51 y.o I was given a trashbag and a golfcart and drove around the base picking up trash. ( I actually kind of dug it? ) The next month I taught recruits how to recite the “Airman’s Creed”.
Bottom line there are ethical ways to deal w/ being in between jobs. This is where my disappointment comes in w/ the new Admin. I thought if ‘anyone’ could motivate people into getting involved while they’re drawing checks it would be our current President. What went wrong there?
I agree pack. They need to be real jobs paid for by real money. I’d like to see less offshoring too, but we have a clear “Tragedy of the commons.” If a scrupulous company doesn’t take advantage of third world labor, an unscrupulous company will.
Which is exactly why we need to encourage **fair trade** with other countries who have the same environmental and labor protections (and wages) that we have. Everything else should carry stiff tariffs.
“The DOW is to run back up over 10,000 today according to some sock puppet on CNBC.”
When Fed officials speak, rallies happen.
E.F Hutton..?
9899 close.
CMS Board Approves Nearly 1,000 Layoffs
CHARLOTTE, N.C. — The Charlotte-Mecklenburg Schools board made it official on Tuesday.
In an 8-1 vote, members went through with a plan to layoff nearly 1,000 district employees, including more than 500 teachers.
The one “no” vote: Kaye McGarry
“I understand it will pass, but I’m not going on record supporting it,” McGarry said.
The layoffs come as the district plans for nearly $80 million in cuts.
If you think that school layoffs are going to be bad this year (2010-11), wait’ll next year. 2011 to 2012 is supposed to be the worst. Many Universities will close and merge.
So much for the quality of US Universities.
I’m probably toast.
Roidy
I agree Roidy,
We ain’t seen anything yet.
That’s what I keep telling people. This year is the kind of damage you would expect in a bad recession. Next year is armageddon.
My youngest will be a senior in high school during the 2011 to 2012 school year. Basically, I don’t believe that school year will exist — and community college will probably not be an option either.
The good news is I told her this would happen going in, and she is at an advanced high school and will have had a better education than I did by the end of her junior year.
You think the school year wont exist? Huh?
What is her education interest?
Count your blessings she is near the end of it all. We are just now trying to get into a good middle school in Tampa (very limited choices). So we have 6 more years of worrying!
We either have to 1) pay for private or 2) move and pay a lot more rent to get into the good public ones. 3) we could buy, but it would have to be fast.
The rent option gets above our buy option on a per month basis if we move, but the jobs situation is tenuous at best. We have some hard soul searching and decision making these next two weeks, and have to have our plan executed in 6 weeks.
I’m for moving and renting, the wife is for staying put and paying for school. Either way we didn’t win the school lotteries, so now we pay.
Rusty, DH and I recently spent a lot of sleepless nights in your situation. At $16,000+ a year tuition, we couldn’t afford our first choice private school. The public elementary school to which our rental is assigned is a failing school. In fact if the school fails this year they’ll have to offer families the option of attending a different, passing school in the district come September. I couldn’t stand waiting to find out, so we enrolled our child in a less expensive private school.
Good luck to you making your decision.
Still wondering about NJ school system. Might have substantial problems.
Community college… On a plus note… tuition… it is way higher than I remember it but you can go full time for 3000$ tuition/books per semester. That is with 18 credit hours.
Several of the big universities have transfer agreements with the CC system. A lot of people drop out of things like engineering in their first and second year, hence a lot of room in those majors for second chance people.
I struggled a lot through college. Very happy that I had a retreat path through the CC system before I went on to an 4 year school. Knowing what I do now, I’d have saved a lot of stress and money and gone their all along.
Course, as every teen knows by their senior year, you will die broke and alone in a hotel room if you don’t get into the school of your choice. Good luck arguing through that hype.
My school, NJIT, tuition, fees, books… 16K per year. Not bad. Room and board/transportation exc… left those off cause you need them no matter what.
Believe me I am grateful she is near the end. I am also grateful neither of my children are graduating into today’s job market.
At Stuyvesant HS, my younger child’s educational interest is survival — it is a place with all really bright kids and a fast pace. She has to spend a lot of time studying to keep up.
We thought we were in a decent school district, but it turns out they have been racking up debt for years to cover their budget deficits. Now they’re in big trouble, and next year is going to be ugly: no gym, art or music; extra recess; 35 kids per classroom; school day shortened by one hour. The union absolutely refused to reopen their contracts. The remaining teachers will still get their automatic raises, and gold plated benefits. Teacher’s unions - putting kids first!
Thanks for the thoughts Kim, we didn’t sleep too well last night ourselves. Nice to know there are others facing/have faced this dillema and we are not alone.
It seems the missus is now at least considering taking a look at a rental or two before plunking down the private school dough straight away. The house will be smaller and at a higher rate, but in a much better location. Nobody wins when you throw in the stress of moving. Plus half the daycare plans for summer are trashed if we move. Ugh.
Bah, why do there have to be failing schools in this country! Look at the angst and cost for all of us.
The area we’d love to move too has a ways to fall before the prices get affordable again. The competition for those 2 schools is so fierce it really drove up the rental prices. They don’t even respond if you try to haggle on the rate. The houses just get snapped up in a week or less.
We have Jr’s college paid for, we didn’t expect to have to pay for middle and Jr and high school as well. Life! Can’t cry over it, make an informed decision and go with it.
“why do there have to be failing schools in this country! Look at the angst and cost for all of us.”
Because EVERYTHING is going toward closing the Achievement Gap, but it can’t be done.
Schools closing, teachers and cops being laid off…WhereTF did all of our tax dollars end up? Were we hiring teachers and building schools based on bubble projections? What happened to taking a money pie that already exists and slicing it up where each piece is the budget for an agency, department or district?
No doubt some folks on this BB will view this as definite proof hyper-inflation is just around the corner.
I can see a surge of homeschooling in our future. Sustained high employment means more adults staying at home anyway and budget choks on the schools can only lead to further declines in quality. Its going to be very interesting.
I recently did a lot of research as I was contemplating home schooling my own child. There didn’t seem to be a lot of downside, I’ll say that much. While I opted not to home school, I will say that I feel much, much more comfortable with that option as as a back-up. I don’t think it will take long before lots of other parents start questioning their children’s educational options, doing the same research I’ve done, and coming to similar conclusions.
choks = chokes
“I can see a SURGE of homeschooling in our future” ( There, fixed )
This isn’t necessarily a bad thing. In fact, it just might be the (1) good thing that comes of all of this?
It’s a bad thing. Less income — someone has to stay home. And not everyone can teach high school chemistry.
The best off parents could make it work. Form co-ops with five kids, alternate days off, have parents with different abilities, able to buy computers etc, able to pay for quality on-line schooling — and identify it and not get ripped off.
But it will be one more nail in the coffin of equal opportunity and upward mobility.
WT Economist,
Points I hadn’t considered? I’m very comfortable speaking in front of groups, and actually kind of enjoy it. I’ve worked/supervised young people most of my life.
But that’s not everyone now is it? And you’re right, without a proper lesson plan and the technology to share it ( Sea Stories only go so far? ) And no, I can’t imagine applying at college and having to explain how you were homeschooled.
“And no, I can’t imagine applying at college and having to explain how you were homeschooled.”
From what I understand, academically its not (currently) an issue. Homeschooled kids typically do exceptionally well at college testing. When it comes time for an interview, often the admissions officers find themselves sitting down with mature, well-manned young adults who can whip out an entire portfolio of work (carefully saved by their parents) in a nice range of subjects. Concentrated one-on-one learning has allowed academic work to be done in a shortened time span, which allowed plenty of leftover time to work on the extracurriculars, volunteer work, travel, etc. that so impresses the admissions officers.
One downside that I’ve heard homeschoolers mention: since they aren’t enrolled in the public high schools, a lot of them are ineligible to participate in higher level high school sports, which seems to be one of the few remaining sources of college scholarships.
WT’s points are very valid, though. If people start homeschooling because of external reasons, rather than internal — currently homeschooling families do it because they were called to do it or because they are completely and totally committed to their children’s education — I don’t know if future results would match the existing ones.
DinOR;
You might be surprised at a colleges response to home schooled kids. Some colleges see it as a plus. I think it depends on the area.
But home schooling is a lot of work. Both I and my spouse are certified teachers, and have worked in the public schools. We are as qualified as any to home school. Our kids go to public school. We live 5 houses from the edge of the zone that allows our kids to go to what is probably the best public school in town. To be blunt, it’s where the rich white people send their kids.
So we occasionally augment their education. Both our kids were reading and able to perform addition and subtraction before they got to kindergarten. Are my kids exceptional? Maybe one is, but they are both well educated.
It didn’t take a lot of work on our part to get the kids there. It did take a little work, and an attitude that education matters.
The two biggest predictors of educational success: Do the parents stay married? (two parent family) and does the family stay put (moving is not good). The school itself can control neither of these. The parents are the biggest obstacle, and the biggest asset.
Cassandra,
Then here we are at the tip of the spear! For the longest time I’ve been told that ‘the’ single most important thing ANY of us could do right now is to continue bubble-sitting at ALL costs!
Economically ( it’s a little tough to argue that ) But there’s so much more to life than getting a rock-bottom steal on that dream house you’ve been eyeing. Kids have to matter at some point, and we have a lot of very… concerned parents here!
Uprooting them on a continual basis isn’t the same thing as buying an overpriced POS just so “you can paint the walls any color you like!”. You speak of balance, and I believe you.
My wife was homeschooled as were several of our friends. Most people choose to use a homeschool co-op of some sort for secondary level classes. Since chemistry was mentioned, my wife learned chemistry from a prof at the local state university, including lab instruction. Your mileage may vary, but it doesn’t take that many well educated parents to form a pretty good coop able to teach a variety of difficult classes.
Agreed Coward. The first step to success is to get off the couch.
The two biggest predictors of educational success: Do the parents stay married? (two parent family)…
So what if a spouse dies. Still a success story or lumped in with the divorcees?
I would add a 3rd one The LESS you fill you mind with gutter rap and hip hop the better your chances become of educational success. And this we can control…but don’t want to ….
Because we need that permanent underclass….
———————–
The two biggest predictors of educational success:
Being a single parent, I felt the need to dig deeper on this one. Seems more an economic issue rather than a simple matter of only one parent (Source: http://www.associatedcontent.com/article/365491/single_parent_households_and_childhood.html?cat=4):
It is also clear that the negative educational effects of living in a single parent household are not caused by the absence of a second parent. Clearly, many if not all of the academic problems faced by children of single parents can be attributed to poverty (Hargreaves 1991: 40).
Numerous investigations have proven that children from single parent homes obtain lower IQ and SAT scores. Moreover, these children have lower grade point averages and complete fewer years of schooling. However, when studies of IQ, SAT scores, GPAs, and years of schooling controlled for socio-economic status, they found the difference in academic achievement to be hardly significant (Hargreaves 1991: 41-42).
This implies that children of the same income level, from both one and two parent homes, achieve at the same level in school. Therefore, the factor affecting any child’s achievement is their access to educational resources through wealth (Mueller and Cooper 1986).
They are only predictors. Predictors paint with a broad brush.
Homeschooling has been great for our family. We have three homeschool grads and one more at home. Our older son was accepted by all six colleges to which he applied; his high ACT scores got him a substantial amount of scholarship money. He graduated with honors in 2007 and has a good job.
We sold our home in 2007 and are in our second rental house since then. We’re glad we didn’t have to pull our teens out of high school to make these moves. Another benefit of homeschooling!
You know, I joked out loud that we need to find a home-schooler in our area and pay them to teach our son. Should be cheaper than private school, and you know the education would be better. Of course when folks started doing this (similar to the one-room schoolhouses of yor), the gubmint would step in and try to regulate it.
You bet they would. New York State regulations for family child care allow after-school care in one’s home for up to 12 children, but specifically prohibit the at-home care of school age kids during school hours.
Probably a provision that got inserted into the Family Child Care legislation by the United Federation of Teachers.
In NYC, just based on the money going to teachers and supplies, a teacher could be paid nearly $150K to educate a class of 12 in their home — with funding for someone to check up on them in addition. But then, who would pay for the unfunded pension costs.
I always wondered how mothers home-schooled the older kids while at the same time taking care of younger ones. A friend of mine from high school home-schools here two older kids and has two that are still too young. Add to the newborn coming next month and a husband in the Army (deployments, etc.) and I gotta wonder how anything ever gets done.
I’m guessing it got to be too much as they ended up sending the older kids to a private school last spring. But with the upcoming deployment and relocation, she’s said she’s gonna have to go back to home-schooling.
I always wondered how mothers home-schooled the older kids while at the same time taking care of younger ones.
——————–
One of the hallmarks of well-educated, homeschooled kids is the ability to learn independently and be responsible for their own education.
They tend to be more focused on certain subjects (rather than having a more general, superficial education), but that’s not really a bad thing (IMHO), as it’s often what differentiates a very successful adult from those who struggle professionally. Homeschoolers tend to be very good at specializing in/mastering a particular subject, in general.
We homeschool, and even at the elementary level, our kids are expected to do a lot of work independently. I essentially give them assignments and follow up with them when they’ve completed their work. We preview and review in between their assignments, and work together when introducing new material and at the end, to be sure they’ve mastered what they’ve learned.
It’s not easy to HS different ages and abilities, but it’s no different that what teachers have to deal with in traditional classrooms — the spread between the very bright and the more challenging students can span multiple grades.
When you’re homeschooling, you have the ability to teach one-on-one and your have your child’s best interests at heart. You can also supplement by hiring tutors or specialists in a given subject.
“our kids are expected to do a lot of work independently”
Personally, I have gotten perhaps 20 years of formal college “education”. But the most valuable education was learned here in the last few years. This is why Ben knows where to find me, and is in the Free Beers for Life Club.
Cassandra,
Totally agree.
After spending over a decade in college (lots of that because I was one of those “lifer” students who enjoyed the college experience too much…and kept changing majors
), I can honestly say I’ve learned far more right here on Ben’s blog. This blog is a true gem.
More employees jump ship as economy improves, signaling an upswing in the job market. (AP)
One sign of better economic times is when more people start finding jobs. Another is when they feel confident enough to quit them.
More people quit their jobs in the past three months than were laid off — a sharp reversal after 15 straight months in which layoffs exceeded voluntary departures. The trend suggests the job market is finally thawing.
Some of the quitters are leaving for new jobs. Others have no firm offers. But their newfound confidence about landing work is itself evidence of more hiring and a strengthening economy.
“There is a century’s worth of evidence that bears out this view that quits rise and layoffs fall as the job market improves,” said Steven Davis, an economist at the University of Chicago.
Many peeps are conditioned to be able to jump from job to job from their experiences in the last 25 years. After wider events interrupted their plans, their internal career alarm clocks are going off.
That article so full of crap. UE is still over 10% in many states and just a hair under, nationally.
That is NOT an improving job market.
Blatant and very bad propaganda.
Hey! Hbb’ers,
Can you post some more housing photos. I really miss those. I’ll try to get some posted myself.
Roidy
Meg Whitman won the party’s nomination for California governor on Tuesday and Carly Fiorina will carry the GOP banner into the fall campaign for a Senate seat, a pair of wealthy businesswomen and first-time candidates running against veteran politicians in a year of palpable anti-establishment sentiment.
So the two corporatist candidates won in the primaries. California deserves everything they’re going to get as this hellish pair facilitate the unbridled corporate looting and asset-stripping of what remains of California’s productive economy, once they replace their equally odious and out-of-touch opponents.
Sammy,
It’s not that some of us are out of touch in Kali, it’s more the case of having to choose between a new liar or an established liar. There is no winning with the present system. This thing needs to go down in flames and start over. With the new demographics I fear this state will continue its decline.
I finish nursing school in 10 weeks in “the great state of California”
I will leave here as soon as I can. Taking with me a needed skill, and my family,and all the money we would have spent. That may not be much, but this state has become one big bowel movement.
“This thing needs to go down in flames and start over”.
Ain’t that the truth!
I do think a good many things will be going down in flames by years end, to the shock of so many that are disconnected from reality.
Checklist for a third world country:
1) Poor educational system, dumbed-down population. Check
2) Rule of law destroyed, instead rule by oligarchs, corrupt political lackeys, capricious judges. Mob rule. Bribery. Third world style leadership: Check
3) Small or no middle class: Getting there
4) Widespread propaganda and vote pandering: Check
5) Low or subsistence wages: Check
6) Exploding population, crime, poverty: Check
7) Crumbling infrastructure: Check
9) Citizens held in contempt by politicians and wealthy. Life is cheap and disposable: Massey Energy, BP worker deaths, etc.
10) Large geographic area fouled by a rotten Brit multinational corporation in cahoots with bought and paid for government. Check. Check. Check.
11) Communist Revolutionaries waiting in the wings to “replace” Capitalism after having assisted in the sabotaging of the same.
SV guy,
My days of holding my nose and voting for the lesser of two evils are over. Our current political duopoly has a singular agenda: providing top cover to TBTF banks, facilitating Wall Street’s looting of the productive economy, and perpetrating the unchecked and unaccountable growth of government power and intrusiveness. Voters who take part in this puppet show are fools.
As far as your prescription that “the system needs to go down in flames and start over,” read your history. Almost every violent revolution in history was instigated, guided, and manipulated by elites who most emphatically did not have the good of the nation or its citizens in mind. An anarchic upheaval is the last thing we need. Only criminals and the unscrupulous would benefit.
No, the citizens who pay the bills and how care about this country and the future of their children need to turn off their TVs, engage their brains, get a clue, and start organizing independently from the corrupt and co-opted Establishment Republicrat party machines. I wrote in Ron Paul on the ballot in 2008, out of a refusal to vote for the appalling Obama/Biden or the beyond ghastly McCrazy/Palin tickets, neither of whom came remotely close to representing me or my interests.
The circle of power shrinks to a smaller and smaller #, eventually some at the top who see what is happening decide they want a revolution so that they can remain in the small circle of elite. Often they use populist rhetoric to take control.
Chavez?
Hitler?
etc.
I would like to see a discussion of some potential write-in candidates for the next election.
Whitman and Fiorina scare the daylights out of me.
Sammy,
We are in agreement. My flames comment wasn’t meant to reflect anarchy. I was alluding to the financial flame of bankruptcy. Ca will declare BK in the future IMO.
I also wrote in RP for prez.
In the near future our new “leaders” will be the alpha males with the most ponies.
Proof that the GOP cares nothing about Main St. Should be an easy victory for the Dems. In Fiorina’s case, all they have to do is remind voters how she is pro offshoring. When it comes to politics the woman can’t keep her foot out of her mouth.
Hopefully the D-rats will quickly field some politically viable black contenders to oppose the female CEOs. Otherwise, given what California politics is, I expect the potent combination of gender and Wall Street money to carry the day for Gollum’s candidate.
You forgot there were Democrat primaries yesterday too….
Jerry Brown will face Meg. I’m old enough to remember Jerry Brown’s first go at being Governor. But you don’t even have to go back that far. Consider Brown’s term as Mayor of Oakland. He really left Oakland in great shape. Can you imagine Oakland as a model for all of California?
“given what California politics is…”
GOPOFC&CC = “The Grand Old Pimp of Fiscal Conservatives & Compassionate Conservatives”
= 30% in CA… was 37% when Wilson & Duke-main-gian were elected
Meg 2010 / Beg 2011
“…So the two corporatist candidates won in the primaries.”
Meg = “Here let me see you beg…”
Carly = “I’ll run California better than Hewlett Packard”
California is officially 50+%…non-white
The 3X income rule for a house….
I can see that holding for the low end. But as one’s income increases, the 3 in 3X income should increase as well. At some point, you’ve covered all you other expenses and any marginal increase in income can be devoted to housing.
Example:
$50K income, buy $150K house. Monthly income is $4800, mortgage is $1000, $3800 left over for all other expenses.
Using that same ratio, $100K income means $300K house. Monthly income is $9600 for a $2000 mortgage. Leaving $7600 for everything else. But in reality someone making $9600 a month can devote a lot more than $2000 for housing. The “everything else” doesn’t double because the income is double. The amount spent on food is the same, car insurance is the same, clothes cost the same. The only expense that might increase is utilities since a $300K house is most likely bigger than a $150K house.
Double income again to $200K. The 3X rule says max house one can buy is $600K which is $3K in housing and $13,600 for “everything else”. However I say spending $5,000 a month on housing and leaving $8,600 for everything else would be fine, since again, the cost to eat, drive, clothe, etc is not 4X as much for someone earning $200K as it is for someone earning $50K.
No income tax there? I say go for it, Eddie. Mortgage interest is money well spent!
“But as one’s income increases, the 3 in 3X income should increase as well. At some point, you’ve covered all you other expenses and any marginal increase in income can be devoted to housing.”
Wrong — bass ackwards. Think about it for thirty seconds before posting, Eddie. Do you think Mitt Romney paid more than 3X his income for his new pad in La Jolla? When incomes (and wealth) get high enough, the income multiplier goes down, not up from 3.
When incomes (and wealth) get high enough, the income multiplier goes down, not up from 3.
I think Eddie’s point is not based on what people TEND to spend, but on what they can sped comfortably.
a certain DTI ratio makes sense when you have to consider the expense of necessities. After those are met, one has more disposable income that *could* be directed towards housing, if one so chooses, without placing oneself in the same financial peril as one making $50k/year would.
I think it’s a fair point, but I’m not sure why he’s making it.
It is equivalantly true that people could spend LESS of their income by living in the same sort of house. But over time, we’ve seen that even when we had increasing real wages, people tend to spend the same percentage of their income on housing. That’s part of the reason why houses on average are bigger than they were in the 50s. Heck, I’m single, the purchase price on my house from 1950 was appoximatly 2x my income.
I think Eddie’s point is not based on what people TEND to spend, but on what they can sped comfortably.
———————-
Agree with this, and think Eddie is making a valid point.
I could see how it could go the other way as well. Does the Honda now become a Mercedes? What happens to car payments and insurance?
The amount spent on food is the same, car insurance is the same, clothes cost the same.
Except that usually people who make more, spend more on things like designer clothing and shoes, luxury cars, boats, eating out at good restaurants, maids, landscapers, hi-def t.v.s, etc.
eastcoaster,
Correct. Moreover, I would think ( well I know ) that those in higher brackets not only contribute the max to their ret. plan, they also shelter in other ways like annuities etc.
You certainly don’t think they’ll be able to maintain… their lifestyles in retirement on a janitor’s pension now DO you!? It’s a cute comparison and Lord only knows the Bay Area blog was awash in Realtwhores making that very case, but life typically works in linear fashion. The more you ‘make’ the more it ‘takes’.
Gotta’ keep your slip at the marina and golf memberships current you know?
How does 100k/yr equate to $9,600/mo.? Your net on 100K is ,at best, $6,500/mo.. Don’t they pay taxes in Georgia?
I noticed that. And $50k a year is not $4,800 per month, it is $4,167. Strange math.
Ugh, I meant $4200. Thanks arithmetic police.
I still stand by the fact that someone making $300K does not spend 6X as much as someone making $50K on food, clothing, cars, etc and yes even with taxes taken into account.
Not sure what the dig at Romney was all about. I didn’t know he lived in La Jolla. Good for him. Great place. If California ever gets its $H*t together, I would love to live there as well.
Teens Face Worst Summer Job Market in 41 Years
CNBC News
The kickoff to the summer job season is not looking so hot for teens.
Employment among 16-to 19-year olds in May grew by just 6,000, the smallest increase since 1969, when teen jobs fell by 14,000, according to government data analyzed by employment firm Challenger, Gray & Christmas. In May 2008 and 2009, teen employment grew by over 110,000.
“It’s certainly a preliminary strong indication that it’s going to be a tough job market for teens,” said John Challenger, CEO of Challenger, Gray & Christmas.
“…the smallest increase since 1969″
But hey, anyone want to wager there are more drugs in American homes today then in1969…
Nancy Ray-Gun: “Just say No!”
Good thing all property owners in PB county are rich…
Palm Beach County faces 13 percent property tax rate increase
County commissioners increased property taxes by nearly 15 percent for 2010.
Palm Beach County property owners for the second year in a row face the possibility of a double-digit tax rate increase to head off a looming budget shortfall.
The county’s proposed tax rate would go up about 13 percent — just one year after a nearly 15 percent tax rate boost — to help cover a $100 million projected shortfall, according to the county’s 2010-11 budget proposal released Tuesday.
The struggling economy continues to lead to declines in property values. Those declines, coupled with past county government spending decisions, put the county in another budget hole.
no matter. they don’t pay state income tax.
Teens Face Worst Summer Job Market in 41 Years
http://www.cnbc.com/id/37573330
The kickoff to the summer job season is not looking so hot for teens.
Young Americans are expected to face a tough summer job market.
Employment among 16-to 19-year olds in May grew by just 6,000, the smallest increase since 1969, when teen jobs fell by 14,000, according to government data analyzed by employment firm Challenger, Gray & Christmas. In May 2008 and 2009, teen employment grew by over 110,000.
“It’s certainly a preliminary strong indication that it’s going to be a tough job market for teens,” said John Challenger, CEO of Challenger, Gray & Christmas.
Jobs traditionally given to teens are apparently going to older workers who are willing to take low paying job to make ends meet. Employment among 20- to 24-year-olds grew by 270,000 in May, an unusual spike, considering that employment in the same age group fell by 261,000 in May 2009.
Shall we all move to India?????
India best place to be if you’re hunting for a job
New Delhi: India has emerged as the most optimistic nation in terms of hiring plans for the next three months, led by strong employment opportunities in the construction and mining sector, says a survey.
The Employment Outlook Survey for the third quarter of 2010 by global staffing services firm Manpower said that hiring activities in India are expected to reach the pre-recession level in the coming months.
“With a net employment outlook of 42 per cent, Indian employers report the most optimistic forecast among all 36 countries and territories (surveyed), Manpower India’s Managing Director Sanjay Pandit said.
“The positive hiring trend in India is primarily due to strong domestic demand,” he said. Indian employers have been reporting strongest hiring plans for more than two years (over eight quarters) continuously, according to Manpower.
Indicating a pick up in the job market, the employment outlook — an indicator of hiring activities — climbed by two percentage points as compared to the second quarter. The outlook has improved by 19 percentage points as against the 2009 third quarter.
Apart from India, strongest employment prospects were reported by employers in Brazil (40 per cent), Taiwan (39 per cent), China (27 per cent), Peru (24 per cent), Australia (21 per cent) and Singapore (23 per cent).
Not only that salaries are pretty good, too I heard.
A decent programmer can fetch upwards of 10 lakh rupees (little more than 20K US).
We are all indians now.
Until war breaks out with China or Pakistan or Bangladesh…again
Maybe it won’t go nuclear the next time…
Just TRY and get a work visa.
Go on, I dare ya.
It’s a lot easier for the westerners. Same thing can’t be said for the people from the neighboring countries.
Early warning.
http://online.wsj.com/article/SB10001424052748704256604575294752929982426.html?KEYWORDS=rhode+island+receiver
“Central Falls, a small and deeply troubled Rhode Island city, has handed control of its finances to a receiver, a rare step that many in the $2.8 trillion municipal-bond market are watching to see how stressed municipalities may deal with deepening fiscal problems.”
“The city of about 19,000 people, a third of whom live in poverty, is struggling with growing budget deficits and the need to pay interest on about $17 million in general obligation debt.”
It also has a drastically underfunded pension plan, and would have to double property taxes to pay its past obligations even as current services are gutting.
It’s starting with the most troubled of the “subprime” municipalities, but it won’t end there.
“…would have to double property taxes to pay its past obligations even as current services are gutting.”
Here comes the freight train! Ah, the pride of ownership!
The role of city government - to pay public union pensions.
All the other stuff (fixing roads, cleaning streets, arresting bad guys) are the things that can be cut.
Taxes for no services - it is what “public servants” do best.
whenver they want to increase taxes it’s always for cops, firemen and roads.
they lie.
All the other stuff (fixing roads, cleaning streets, arresting bad guys) are the things that can be cut.
———————
Those workers who fix roads, clean streets, arrest bad guys, etc. are the ones with the pensions.
It’s easy to pick on union workers during the bad times, but it was very difficult to hire people in the public sector during the good times — even with those “generous” pensions and benefits.
In most cases, those pensions were destroyed NOT by “greedy union workers,” but rather by Wall Street and the Federal Reserve — who pegged interest rates too low and forced fixed income investors into riskier investments.
“forced fixed income investors into riskier investments”
Individual Government entities forced pension administrators into risky investments by writing non-cashable checks.
Bill Bonner complains about the lack of clunkers on the car lot:
“We went to a used car dealer over the weekend. One of the children needed an automobile. We looked on the Internet. And then, on the recommendation of a friend, we went to a used car dealer. We were looking for a clunker.
“Trouble was, there weren’t any clunkers.
” ‘How come you don’t have anything for less than $5,000,’ we asked the dealer.
” ‘Because the bottom of the market disappeared. Remember that Cash for Clunkers program? Well, normally we would have bought those clunkers ourselves. We would have invested a few hundred dollars in them and put them back on the market. But the clunkers were taken out of the market all together. They were destroyed by government decree.
” ‘There is a whole class of people who depended on those old cars for transportation. Now, they don’t exist. It’s hard to find a decent car for a couple thousand. I feel sorry for people who are unemployed, for example.
” ‘And I saw a figure in Automotive News that each of those clunkers cost the federal government $24,000. Your government at work.
You can get a bicycle set up for commuting for $400. A couple of hundred more for the needed weather gear. A couple of hundred more for a electric-assist bike if you are out of shape or in place with steep hills.
As the U.S. gets poorer, I think the car (or at least the second car) will be one of the things that has to go first, along with the excess square footage.
Personally, I am looking forward to the day when I will have only one car. When I retire in a year or so, I will down size to one, ASAP. No problem driving Mrs. S. to work, or just doing without for the day. If I need a car badly enough, I can rent one.
I used to be a real motor-head, now I just find a car to be a necessary nuisence.
Spokaneman,
I made that switch several years ago. When I head down to do my Guard tour, I’ve already made reservations w/ Budget. Since I probably should be more focused on running PT ( than running around TOWN ) I figure this is good for me.
Be a little wary though. You lose the multiple car discount thru your insurer and we don’t get breaks at Les Schwab like we used to etc. But you def. save and I haven’t found it to be ‘too’ big of an inconvenience at all!
At one point when the kids were home, I had four cars and a boat. My life was pretty much vehicle maintenance. Boat gone, kids gone, and the cars are pretty new. But even taking them for oil changes, tire rotations warranty work just strikes me as a huge waste of time and energy. Reduce the fleet by 50% (2 to 1) and life gets much easier.
Weekend rental car rates around here are about $22/day for an Impala Thursday through Monday.
I used to be a real motor-head, now I just find a car to be a necessary nuisence.
Me too! I used to see driving as a sport. Now it’s just a chore. I used to spend time and money trying to increase my horsepower. Now I spend time trying to reduce my fuel consumption. I used to feel a sense of accomplishment when I’d beat my best 1/4 mile ET. Now I feel a sense of accomplishment when I can stop at 4 or 5 different stores in one trip. The romance of the car is dead for me. It’s really just an appliance now.
I switched to bike only 2 years ago (you’d think that I’d be thinner!), so I don’t do much driving, but check out “hypermiling”. These guys are kooks who can make their Accords get like 50 mpg. Much of it is about timing and skill: always coasting to the stop light, no brakes around corners, driving on the white line (!)
It’s always unbelievable to me how many people have to touch their brakes on the highway. Losers following too close to the car in front of them. I think that I made it from SEA-TAC to Mt. Shasta with no brakes last year. Tried to pull in for gas that way, but my companions were not happy. A very sloooow Cannonball Run.
MrBubble
Mr Bubble,
I’ve heard of these “extremists” too! Ultra-miling? Other than using the white stripe ( don’t know that I’d advise that ) I employ most of those tactics already.
My wife and daughters do about 50mph until 30′ of the stop sign but ‘my’ cars can go to the boneyard w/ factory brakes.
Riding my bike and being heavy (it’s my panniers, really!)drills those techniques into you. I see all of these cars racing by me to get to the red light first, but I know that it takes a lot of effort to get me going again so I just coast and think about the gulf spill.
My wife (just got married Friday and that’s the first time I’ve written that, whoa!) does the same. I make comments about the brake dust build up on her ride from time to time, but not so often as to have to sleep on the couch!
Mr Bubble!
Congrats! Finding love in the post apocalyptic fallout! Alright….
Never thought just how much of a “boot camp” and indoctrination that must be? Yes.., when ‘you’ are the one that has to expend extra energy, those lessons stick.
I will say, and here’s your trophy, you see a difference when you’re driving a Gov. vehicle! ( Why shut the engine off? I’ll be out in 5 minutes! )
There’s improvements we -all- could make and I will say when I’m on the EPA Mileage website I’m always surprised at just how bad a mileage I ’should’ be getting?
Congrats Mr. Bubble!
Thanks much. I have a feeling that she performs well in post-apolcalyptic scenarios. She is Australian after all!
“I will say, and here’s your trophy, you see a difference when you’re driving a Gov. vehicle! ( Why shut the engine off? I’ll be out in 5 minutes!)”
That always gets me, gov’t vehicle or not. I do my idling at stop lights by humming “Van Halen”. DLR Van Halen, of course. I heard that music with a strong beat can increase your output by 15%. Unchained!
Thanks much. I have a feeling that she performs well in post-apolcalyptic scenarios. She is Australian after all!
Speaking as someone who has Aussie relatives, I can assure you that it’s in the DNA.
Happiness to you & Mrs. Bubble ! And any little Bubbles which may come along and land.
My wife (just got married Friday and that’s the first time I’ve written that, whoa!)…
Awesome news, MrBubble! Congratulations to you and your new wife!
Go to a bicycle swap meet (we have ‘em twice a year in Tucson) and buy a clunker bike.
I’ve been blown away by what I’ve seen for sale at our swaps. Some very good deals on experienced bikes that still run well.
You can do that when you are almost retired. I have 3 kids, doing a bike just isnt an option.
Bill pulled a Boner finding a used car huh? And this guy is your hero?
Pfft!! Cash4Clunkers only paid for guzzlers. What about cars that were “fuel efficient”? My daughter drives a 2000 Impala. It didn’t qualify for C4C, hence its still running, as are a lot of other 2000 Impalas.
The real reason there’s a shortage of cheapo used cars? People have been buying them and hanging on to them, and those who already had one are not trading them in.
The $5000 car is the $1000 car, circa 1980-85.
Why? Because that $1000 car needs $4000 in repairs to make it reliable. And the kinds of repairs they need aren’t the kind that the standard J6P can handle in his driveway anymore. That engine management computer costs 500 bucks, whether it’s going into a $1000 car or a $10K car.
Overhaul of old fashioned 3 speed automatic trans = $5-800 bucks, and change it in the driveway.
Overhaul of new-fashioned, computer-controlled, 5 speed automatic = $2000-2500 bucks, and it needs to go to the shop (especially if it’s a front-drive car).
I’ve seen good cars get crushed because the front end was hit hard enough to destroy the plastic headlights and fascia, and pop the airbags.
Between inflation, and government mandated safety and emissions equipment, cars are heavier, more complex and more expensive to fix.
The Honda Civic, so often cited here, is a typical example. Want to know why manually cranked windows are disappearing? Because they have to crash-certify both configurations (manual and electric), and they aren’t going to spend the money to certify crank windows, just to make the 10% of the population who are cheapskates happy.
So now the Civic has packed 20 pounds of crap into a 10 pound bag, and weighs what a Ford Taurus weighed in 1990. For marginal (IMO) improvements in emissions and safety.
This is okay for certain sections of the population, who think all the schlubs should be on mass transit, or riding bikes to work anyway.
I used to get 43 mpg with my ‘89 Civic 5 spd. But I repeat myself repeating myself again.
Bonner is dead-on here. What was the economic value to the COUNTRY in destroying perfectly-good, working automobiles???
It was broken-window economics at its worst.
Just like th FDR gobmint let farmers destroy grains and pigs in GD instead of feeding the hungry people.
ah..that explains it. I’ve been looking over for a used minivan. Hard to find except for really late models. I thought there’d be more old ones around. Silly me.
Bill Bonner is out of touch and desperately trying to a put a political spin on something that has been going on for 2 decades.
State inspection laws have gotten tougher over the last 20 years, resulting in the elimination of “beaters.”
Also, cars since 1998 have been far better engineered and built than any time automotive history. This means they last longer and stay in better condition.
And inflation has driven up the cost of everything, especially cars.
In Texas, they have had the Cash for Clinkers in place… for 10 years. This has resulted in a floor of $3K for any car that can pass inspection. However, it does have an annual cap.
And seriously, you really don’t want to buy a clunker. The real cost of any car is maintenance. A clunker will need more maintenance than something better.
Would today be a good time to buy the dip?
Indications
June 9, 2010, 7:42 a.m. EDT
U.S. stock futures higher before Bernanke view, Beige Book
I am the King / Sheik and when it comes to OIL… I’m “The Decider” of “fair”
OPEC: 2010 demand picture uncertain
OPEC: Europe debt crisis, oil oversupply, weigh heavily on crude demand and prices in 2010 CAIRO (AP)
“For over a year, the group has refrained from changing its output quotas to boost prices. OPEC kingpin Saudi Arabia and others have said oil at between $70-80 per barrel is fair for both producers and consumers.”
Tax-Credit Hangover: Here Come the Builder Price Cuts ~ WSJ
Builders, who ramped up speculative construction to take advantage of the federal home buyer tax credit, won’t know until he credit ends this month how many extra homes they have. But they’re already cutting prices and offering deals to move inventory.
Beazer Homes USA, is offering up to $50,000 in free design options on some houses. Lennar Corp., which already slashed more than 15% off of some Las Vegas inventory, is currently offering a 3.99% mortgage rate “fixed for life.” DR Horton touts the “The Great American Home Sale” on June 12 and 13. The sector giant provides no further detail.
They “want to keep the momentum going,” says Jody Kahn, a vice president with John Burns Real Estate Consulting. “Traffic and sales fell off pretty dramatically in May.”
Indeed, a national survey of real estate agents by Credit Suisse shows that traffic at homes for sale fell in May to its lowest level since the financial crisis of late 2008. The decline from April to May was the biggest-one month fall since the survey started in January 2005.
And the dead cat commences its plummet…
A local builder (none of the big boys come here) is still building new 4-3’s in the hood, priced at $450K plus.
There are three or four existing homes purchased at the beginning of this development (around ‘07) for sale in the high $300k’s. Lots of the “high tech” firms in town have left in the last 18 months, so I suppose the existing homes for sale are the result of that.
Home Purchase Loan Demand Slumps for 5th Week ~ 9 Jun 2010
U.S. home buying applications sank for a fifth straight week to a fresh 13-year low, the Mortgage Bankers Association said on Wednesday, suggesting that tax credits had robbed more from future sales than expected.
Mortgage application
Demand for loans to purchase houses fell 5.7 percent in the week ended June 4 to the lowest level since February 1997, even after adjusting to account for the Memorial Day holiday.
Doh! That’s gonna leave a mark.
Dang it all!! My wife told me Suzanne researched our purchase last month and we would be fine. I can’t believe this kind of news would be coming out. (Sarcasm off)
Could this be caused by all those people who are quitting their jobs to look for better jobs due to the improved job market and they’re just too busy to buy a house?
Oh god, I think I just hurt myself laughing!
Is it me or is it really… weird… that there’s no talk lately of significant additional props to the economy and/or housing market, despite the fact that we’re obviously entering “double-dip” territory?
- No new significant ($200B+) stimulus.
- No new housing supports (e.g. Fed MBS purchases, tax incentives)
- No new significant bailouts.
They’re pulling the rug out from under the recovery. It’s almost as if the PTB decided to let this thing just crash again.
Not that I would actually want any of those things. It’s just odd that there seems to be a big shift away from Keynesianism the past few months. Probably this is due to the Europe debt problems - it surprises me nonetheless.
Or perhaps - more insidiously - some of this stuff is really going on and it’s just more covert now (e.g. Fed treasury purchases under the table or the like).
We are 4.5 months from the elections
The voters may actually remember something.
Don’t forget that Fannie/Freddie still have a blank check and the FHA is still guaranteeing almost all home loans.
i guess they just don’t have a clue.
It’s because the PTB have successfully “backstopped” all of their friends at the country club.
Mission accomplished.
This is something I predicted 2 years with the first bailout. It was never about helping the country and everything about helping their rich buddies. Everybody who could be saved has been and that’s all she wrote.
Remember, it’s socialism for the rich and no holds barred capitalism for the rest of us.
Agree with you, eco.
The bailouts were about buying time so the banks could off-load their bad loans onto the govt via refinancing “bad” loans into GSE loans, and propping up prices with FHA/GSE loans while the shift was taking place.
It remains to be seen if they actually let it continue, but I would be ecstatic if they finally let prices settle where they belong.
Still, it is odd that we’re not hearing about any new bailouts…
BIG NEWS
GM repays loan to US
Repaying Taxpayers With Their Own Cash By GRETCHEN MORGENSON
Published: April 30, 2010
“The public would know nothing about the TARP escrow money being the source of the supposed repayment from simply watching G.M.’s TV commercials or reading Treasury’s press release,” Mr. Grassley said in a speech on the Senate floor last Wednesday, saying that “many billions” of federal dollars remained invested in G.M.
“Much of it will never be repaid,” Mr. Grassley added. “The Congressional Budget Office estimates that taxpayers will lose around $30 billion on G.M.”
(Taxpayers still own $2.1 billion in preferred stock of G.M. and almost 61 percent of its common equity.)
no news
GM recalling 1.5M vehicles over fire concerns
By KEN THOMAS The Associated Press
Posted: 10:55 a.m. Tuesday, June 8, 2010
WASHINGTON — General Motors Co. said Tuesday it was recalling about 1.5 million vehicles worldwide to address a problem with a heated windshield wiper fluid system that could lead to a fire, its second recall over the issue in two years.
The recall affects several pickup trucks, sport utility vehicles, crossovers and passenger car models from the 2006 to 2009 model years. GM conducted a similar recall in 2008 but came across new reports of fires in vehicles that had been fixed.
@ Eddie… understanding that you are a socialist…
from wiki… wikipedia Austrian_School
The economic calculation problem is a criticism of socialist economics. It was first proposed by Ludwig von Mises in 1920 and later expounded by Friedrich Hayek. The problem referred to is that of how to distribute resources rationally in an economy. The capitalist solution is the price mechanism; Mises and Hayek argued that this is the only viable solution, as the price mechanism co-ordinates supply and investment decisions most efficiently (provided there are no relevant government policies or banks operating fractional reserve banking ).
Without the information efficiently and effectively provided by market prices, socialism lacks a method to efficiently allocate resources over an extended period of time in any market where the price mechanism is effective (an example where the price mechanism may not work is in the relatively confined area of public and common goods). Those who agree with this criticism argue it is a refutation of socialism and that it shows that a socialist planned economy could never work in the long term for the vast bulk of the economy and has very limited potential application.
The debate raged in the 1920s and 1930s, and that specific period of the debate has come to be known by economic historians as the The Socialist Calculation Debate. Ludwig von Mises argued in a famous 1920 article “Economic Calculation in the Socialist Commonwealth” that the pricing systems in socialist economies were necessarily deficient because if government owned the means of production, then no prices could be obtained for capital goods as they were merely internal transfers of goods in a socialist system and not “objects of exchange,” unlike final goods. Therefore, they were unpriced and hence the system would be necessarily inefficient since the central planners would not know how to allocate the available resources efficiently. This led him to declare “…that rational economic activity is impossible in a socialist commonwealth.”
Mises’s declaration has been criticized as overstating the strength of his case, in describing socialism as impossible, rather than having to contend with a source of inefficiency.
You’re a socialist and you didn’t know it. Probably ought to read the entire section.
Eddie called me a socialist, when in fact I am a fan of the Austrian school.
But of course, straw man propaganda techniques are one of the hallmarks of socialism…
Problem is the vast majority of the population, have never heard of the Austrian School of economics and momentary theory. If they have they don’t or can’t understand or grasp it, or don’t want to. It’s easier to have blind faith in all you have ever known, the federal reserve and it’s handlers. Never mind why the system is falling in upon itself.
You can stuff a lot of junk into the attic, but one day at some point it will fall down upon your head.
Our attic is getting damn close to being stuffed full, next…Crashing down.
20 trillion may do the trick, one thing is 100% certain we will find out.
It’s easier to use labels like “liberal,” “socialist,” or whatever than to delve into the realm of economic thought and principle.
Yep, same with political labels, to most people there are and can only be two parties. They are to damn closed minded or flat out stupid to really think things through.
Rather sit back and lob simpleton comments, it’s much easier.
momentary theory.
Yeah that’s it in a nutshell.
I think Mr Eddie doesn’t realize when he is playing a socialist’s rigged game and how you can driven from those policies.
I’m also a fan of some of the Austrian concepts and libertarian leanings.
I don’t think that I fit in someone’s small box definition though.
Anyhow… biggest peice of socialism EVER. Our Fed banking system… and that guy think’s he is conservative. Oye. Oye vey.
The classical definition -
Socialism - the state controls the means of production or state ownership of industry.
For exhibit A, I will direct you to ObamaCare…
I though the AMA controlled the number of doctors and nurses.
Fourteen Defining Characteristics Of Fascism:
By Dr. Lawrence Britt
Source Free Inquiry.co
“1. Powerful and Continuing Nationalism - Fascist regimes tend to make constant use of patriotic mottos, slogans, symbols, songs, and other paraphernalia. Flags are seen everywhere, as are flag symbols on clothing and in public displays. ["Where's your flag pin, Senator?"]
2. Disdain for the Recognition of Human Rights - Because of fear of enemies and the need for security, the people in fascist regimes are persuaded that human rights can be ignored in certain cases because of “need.” The people tend to look the other way or even approve of torture, summary executions, assassinations, long incarcerations of prisoners, etc. ["Yeah, we waterboarded Khalid Sheikh Mohammed," Bush told a Grand Rapids audience Wednesday, of the self-professed 9/11 mastermind. "I'd do it again to save lives."]
3. Identification of Enemies/Scapegoats as a Unifying Cause - The people are rallied into a unifying patriotic frenzy over the need to eliminate a perceived common threat or foe: racial , ethnic or religious minorities; liberals; communists; socialists, terrorists, etc. [muslim=terrorist]
4. Supremacy of the Military - Even when there are widespread domestic problems, the military is given a disproportionate amount of government funding, and the domestic agenda is neglected. Soldiers and military service are glamorized. [Have you thanked a "hero" for "keeping us free" today?]
5. Rampant Sexism - The governments of fascist nations tend to be almost exclusively male-dominated. Under fascist regimes, traditional gender roles are made more rigid. Divorce, abortion and homosexuality are suppressed and the state is represented as the ultimate guardian of the family institution. [check]
6. Controlled Mass Media - Sometimes the media is directly controlled by the government, but in other cases, the media is indirectly controlled by government regulation, or sympathetic media spokespeople and executives. Censorship, especially in war time, is very common. [At least the Soviet people knew their media was bull$hit]
7. Obsession with National Security - Fear is used as a motivational tool by the government over the masses. [Condition Red! Is that a smoking Pathfinder in your driveway?]
8. Religion and Government are Intertwined - Governments in fascist nations tend to use the most common religion in the nation as a tool to manipulate public opinion. Religious rhetoric and terminology is common from government leaders, even when the major tenets of the religion are diametrically opposed to the government’s policies or actions. [check]
9. Corporate Power is Protected - The industrial and business aristocracy of a fascist nation often are the ones who put the government leaders into power, creating a mutually beneficial business/government relationship and power elite. [Can you say "revolving door" kids? Thought so.]
10. Labor Power is Suppressed - Because the organizing power of labor is the only real threat to a fascist government, labor unions are either eliminated entirely, or are severely suppressed. [We still have unions?]
11. Disdain for Intellectuals and the Arts - Fascist nations tend to promote and tolerate open hostility to higher education, and academia. It is not uncommon for professors and other academics to be censored or even arrested. Free expression in the arts and letters is openly attacked. [Damn pinko lefties!]
12. Obsession with Crime and Punishment - Under fascist regimes, the police are given almost limitless power to enforce laws. The people are often willing to overlook police abuses and even forego civil liberties in the name of patriotism. There is often a national police force with virtually unlimited power in fascist nations. [Gotta go . . . Nancy Grace is guest-hosting on the AMW-C.O.P.S. telethon.]
13. Rampant Cronyism and Corruption - Fascist regimes almost always are governed by groups of friends and associates who appoint each other to government positions and use governmental power and authority to protect their friends from accountability. [You have to ask?]
14. Fraudulent Elections - Sometimes elections in fascist nations are a complete sham. Other times elections are manipulated by smear campaigns against or even assassination of opposition candidates, use of legislation to control voting numbers or political district boundaries, and manipulation of the media. Fascist nations also typically use their judiciaries to manipulate or control elections.” [I'll stick with none-of-the-above for now]
Socialism? Say what??
And no, Cletus, I’m not moving to [insert nasty little country here].
BINGO
We are moving more toward a facist state then a communist one. Take a look at who controls the wealth in this country. In a communist state it would be the politicians. Yes they are rich but nothing compared to Wall Street. They are merely puppets. Putin tossed business leaders in jail if they didn’t tow the line, I haven’t seen that here (the one exception might be the CEO of BOA, but again I would say that was orchestrated by big money/FED and not the president). I have seen political leaders tossed out for going against big business.
The goal is to strip wealth from the middle and upper middle class. If they do it too quickly without any supports then the people will get angry, but if you lower the lobster into cool water and then gently turn up the heat? Welfare, Food Stamps, and medical care are all designed to keep the proles from rioting. These supports will be taken away slowly once the looting is done and there is nothing left.
Fascism and Communism are both Total Government. Both have an ugly legacy of death, destruction and genocide. Both should be deemed unacceptable by any person of sound mind.
Always important to point out that there are different degrees of socialism
From the US where gov controls the highways (Many would like to privatize them) Medicare, social security, National Parks etc, to Communist Russia where gov controlled everything.
The worst system is one where gov and business get intertwined which at it’s apex is facism. Business leaders then strips the wealth of the people using the gov as a lever.
I give you Wall Street, Mercenaries and other military contracters, Big Pharma, Medicare advantage program, Road construction, etc etc.
A Room With a View, and a Price
For $35,000 a Night, a Butler, a Waterfall and Free Room Service. ~ Wall Street Journal
For guests used to staying in the best rooms at luxury hotels, the top suite at the Four Seasons Hotel New York may offer the ultimate in bragging rights: To sleep in it, you have to stomach its $35,000 a night price tag.
The Ty Warner Penthouse, named for the Beanie Baby mogul and the hotel’s owner, is the most expensive hotel room in the country outside of Las Vegas, an important distinction in the industry since rooms in the gambling capital are often comped for high rollers.
The suite has sweeping views of Manhattan in every direction, bathroom sinks made of solid blocks of rock crystal and a personal butler on-call 24 hours a day. Guests have the use of a Maybach or Rolls-Royce—with driver, of course. Room service from the hotel’s restaurants, including one run by celebrity chef Joël Robuchon, is included in the price and nearly unlimited (though one guest was charged for a $1,000 order of caviar).
The suite, which opened in 2007, cost $50 million to build and took seven years to design, the hotel says.
That’s a lot of beanie babies:
http://en.wikipedia.org/wiki/Ty_Warner
No $h!t !
I hear you can get the Lincoln bedroom for less than that.
Breaking News!…DOW back over 10,000 confidence has been restored. We now return you to regular programing.
…annnnd now it’s not.
PSYCH!
Illinois universities can now borrow to pay bills.
Illinois Gov. Pat Quinn signed a bill into law Tuesday that allows Illinois’ public universities to borrow money in anticipation of already authorized state funding.
Illinois’ local school districts are able to borrow money in anticipation of tax receipts, but public universities have not had that option until now.
Senate Bill 642 allows state universities to borrow money equal to the amount of vouchers that have been submitted to the state but remain unpaid for fiscal year 2010.
The state is hundreds of millions of dollars behind in paying for vouchers submitted by universities.
F’ing great.
The education bubble continues to grow. Pretty soon no one will be able to afford an education, ironically all done on the name of affordability.
Sound familiar?
My alma mater called last night, hat in hand. I cut the friendly banter short and said no.
Have I got a website for you:
EduBubble
A site about the book: Beating the College Bubble
Tankxs Slim!
St. Louis business bankruptcies highest since ‘92
St. Louis Business Journal
St. Louis business bankruptcy filings for the 12-month period ending March 31 rose 20 percent to 409, up from 341 filings for the 12-month period ending March 31, 2009, according to a report released Tuesday by Hoffman Clark, a Clayton, Mo., accounting firm.
That’s the highest number of St. Louis business bankruptcies since the 12-month period ending March 31, 1992.
What does it mean when the DJIA, the NASDAQ, the S&P 500 and the Global DOW stock market indexes are all moving up with near perfect correlation?
I guess when Bernanke speaks, bulls listen?
How can the casual observer separate the effects of optimism from that of outright manipulation? Would the Fed really leave the direction of the stock market up to chance while BB is speaking about ’stabilization’? I find the notion patently absurd.
Stocks surge on Bernanke’s optimism
By Hibah Yousuf, staff reporterJune 9, 2010: 12:14 PM ET
NEW YORK (CNNMoney.com) — Stocks continued to climb Wednesday after Federal Reserve chairman Ben Bernanke told lawmakers that Europe’s debt crisis will only have a “modest” impact on the U.S. economy.
The Dow Jones industrial average (INDU) surged 118 points, or 1.2%, and the S&P 500 index (SPX) rose 14 points, or 1.3%. The Nasdaq composite (COMP) climbed 32 points, or 1.5%.
After a choppy session, stocks rallied during the last hour of trade Tuesday, with the Dow Jones industrial average and S&P 500 ending higher thanks to a spike in commodity and financial shares. The Nasdaq also erased most losses to end just 3 points lower in the session.
Despite posting solid gains in the morning, stocks could continue to go up and down given the market’s recent volatility, analysts said.
“There’s a lot of meandering and indecision among investors, and they didn’t set the tone in the market yesterday until the last hour of trade,” said Art Hogan, chief market strategist at Jefferies & Co.
The rally continued midday Wednesday as investors welcomed Bernanke’s comments that Europe’s financial woes should have a limited impact on the U.S. economy.
“The actions taken by European leaders represent a firm commitment to resolve the prevailing stresses and restore market confidence and stability,” Bernanke said, testifying before the House Budget Committee. “If markets continue to stabilize, then the effects of the crisis on economic growth in the United States seem likely to be modest.”
…
When markets change direction, CNN changes headlines:
Stock rally loses steam
By Hibah Yousuf, staff reporterJune 9, 2010: 3:07 PM ET
…
Now the correlated movement points down across all four indexes. What is the source of the impulse which generates the same stock market response across disparate indexes?
It’s like the finger of God has dipped down from the sky to shake down all the major stock market indexes at the same time in the same direction.
The movement of the stock market must follow a believable narrative. It can’t be all up or all down all the time or people will really lose faith in it if they think it is very highly manipulated.
A “believable narrative.”
There still hasn’t been an accurate explanation of the flash crash yet, has there?
The futures don’t look so bright for The Precious™ today…
Does anyone besides this skeptic find it curious how gold was hammered at the very same instant that the DJIA, the NASDAQ, the S&P 500 and the Global DOW stock market indexes all rocketed up in synch?
Optimism, schmoptimism… this game is rigged from on high.
It’s all in lock step these days.
E.g. European bonds are also way up today (yields down).
The last few months it’s rapidly become a strictly Keynesian struggle.
Optimism that Keynesianism will work =
- Stock markets up
- Bond markets up
- Gold down
Fear that Keynesianism will fail =
- Stock markets down
- Bond markets down
- Gold up
It all depends on which mood everyone’s in that day, as determined by who makes what statement. Fundamentals? Who gives a rip.
It seems like gold should go up regardless of success or failure, as the Keynesian approach means more money pumped into the system = more inflation.
What if the Fed approach is to buy gold when the dollar is strong, then dump it to ’stabilize’ the stock market? That is what appears to be underway today…
It seems like gold should go up regardless of success or failure, as the Keynesian approach means more money pumped into the system = more inflation.
Keynesian approach = hair of the dog cure for hangovers.
Gold = Ibuprofin
If the hair of the dog approach - add alcohol - works*, then you don’t need Ibuprofin.
*It works until it doesn’t - eventually you either need to quit it, or die.
It all depends on which mood everyone’s in that day, as determined by who makes what statement.
Nope
It all depends on manipulation
financial
news
etc.
The one ray of hope I see is Europe not playing ball with the global devaluation of currency. I’m almost tempted to put money into Euro, but I suspect that much of this is just designed to quell the collapse of the Euro. They talke of responsible gov when currency is down, China says they will not sell the Euro, US gov spends recklessly.
Where will the conservative investor go???
“Optimism, schmoptimism… this game is rigged from on high”.
Ah Yep!
All one can do is try snatch what you can when you can. Do it unto others, before they do it unto you.
PPT pounding the shorts today. Will it follow through tomorrow, however? Will it have enough dry powder or will it need a rest?
Looks like they are fading the beige book.
Now it looks like they are just fading…
Common sense from a billionaire:
http://www.cnbc.com/id/15840232?play=1&video=1506508223
“TruePatriotCEO™”
Now, …now they are full of “TrueAnger™” & “TruePurity™”
Hey Stevie-weenie, no HELOC money swishing around in Lost Wages?
Moving your Corporate Office’s over to My-Cow China, going to distribute you “precious” redeeming gifts of gambling to the masses…
“Wynn was appointed to the Board of Trustees of the John F. Kennedy Center for the Performing Arts by President George W. Shrub on October 30, 2006″
Deflation!:
Low-Ball Salary Offers: Should You Take it or Leave it?
by Ruth Mantell
Tuesday, June 1, 2010
WASHINGTON — The job market may be slowly starting to recover, but some salary offers are still a few years behind.
Since the labor market began picking up steam, companies hiring for entry-level or administrative spots with pay that would normally range from $40,000 to $50,000 have been offering workers $28,000 to $38,000, said Randy Miller, founder and chief executive of ReadyMinds, a Lyndhurst, N.J., a provider of online career counseling and coaching.
For workers further up the food chain, an offer that might have been $100,000 a few years ago is now coming in at $85,000 or $90,000, he said.
“Companies are more worried these days about margins, profitability, and they are cutting costs across the board. Even though [workers are] qualified and have prior experience, the hiring department has been told to set a budget at a lower range,” Miller said. “Everybody is more price-sensitive these days.”
As the labor market slowly heals, some hiring managers are offering salaries lower than what workers previously received. The question is: How low should workers go when it comes to accepting an offer?
OK how many will be really motivated by getting $10K Less per year?
I would say the employee will find ways do the minimum. And will claim they are so swamped you have to pay them OT to catch up…
OK how many will be really motivated by getting $10K Less per year?
I took a ~$15k pay cut at my current job. Some of it will be made up by a company-wide bonus assuming the company meets its goals, but it was worth it to me for the stability (full-time vs contract on a failing project), and here’s the kicker…
How hard I work isn’t a factor of what I’m paid. I’ve worked since the day after my 14th birthday, and have always been intrinsically motivated to do the right thing, and do it as best I can…
I of course expect to get paid fairly, but fair compensation comprises a pretty large range, overall…
saw this a few days ago…seems like common sense, in general…
Wage Deflation!:
cash is king?
And those smaller paychecks will be asked to do more than ever.
I was canned about two years ago. I wound up in the middle of a family squabble, and told the managing family member I would not perjure myself, period. So, he allowed that I could tell the truth on my own time. (Such is life)
I was offered a job through a contact at about 30% less than I had been making and I jumped at it. For me the math was pretty simple in that I was about 4 years from retirement at that time (now two) and figured that to replace my previous salary would take at least a year if not more, so it was unlikely that I would ever recoup the year of lost income.
In retrospect, I think it was a good decision in that the job market has declined dramatically and the year might well have been two, or more. Had I been 10 years or even 5 years younger, I might have held out longer for more pay, which might have been a real disaster. Not too many 100K + jobs in this one horse town. The lesser job is not particularly challenging, but it keeps food on the table and money moving to the 401-K so what the heck?
Good move, Spokaneman.
http://finance.yahoo.com/career-work/article/109735/Low-ball-salary-offers-should-you-take-it-or-leave-it?mod=career-salary_negotiation
Low Ball Salary offers link
Mo free money…
Obama, Meeting Abbas, Pledges New Aid for Palestinians.
WASHINGTON — President Obama promised a $400 million aid package for the West Bank and Gaza on Wednesday, as the United States scrambled to come up with a way out of the stalemate in the Middle East exacerbated by the Gaza flotilla incident last week.
Mr. Obama, meeting with Palestinian Authority President Mahmoud Abbas at the White House, said that the money would go to housing and schools. White House officials said that the money also would help increase access to drinking water and to help address health and infrastructure needs.
The exact details of how such aid would be used in Gaza remained unclear. Nor was it immediately clear how Mr. Abbas, who has authority in the West Bank but no authority in Gaza, would be able to administer it.
Gaza has been subjected to an Israeli blockade since 2007; an Israeli raid that thwarted a Turkish-led flotilla carrying aid supplies toward Gaza last week led to international protests over the blockade, which Mr. Obama has called “unsustainable.”
President Obama promised a $400 million aid package for the West Bank and Gaza on Wednesday
Why do we keep giving away our money to everyone?!?!
Seriously…we’re running huge deficits, have all kinds of issues domestically, and we’re just HANDING out money?!
Ugh.
To politicians it’s all just make believe money. They didn’t work for it; and there is no consequence for throwing it away. What’s the problem? Think of it as additional “stimulus” which will help the “recovery”.
Baroke O’Bummer doesn’t care, he just does what the Big Boyz tell him to do.
President Obama promised a $400 million aid package for the West Bank and Gaza on Wednesday
Why do we keep giving away our money to everyone?!?!
Because if you devalue the currency suddenly our labor markets are more able to compete.
Remember BB’s helicopter drop analagy.
It would be nice if they are going to drop cash if they drop it on the average US citizen, but that’s not the point is it.
Printed cash for the elite and to support their projects.
Pay cuts, service cuts, pension cuts for the middle class followed by inflation.
It would be nice if they are going to drop cash if they drop it on the average US citizen, but that’s not the point is it.
It’s the point of my question..
I’m not questioning why the gov’t is spending a metric assload of money more than it takes in. I’m questioning why we’re giving that money to other countries rather than our own citizens.
This has been going on for decades under both Republican and Democrat administrations. Nixon, Ford, “Cahtah,” Reagan, Bush I, Clintoon, Bush, and now Obummer.
For decades the politicians picked our pockets and gave billions of our dollars that belong to us to Israel and its enemies - the Palestinians.
And the voters keep voting for the same politicians to do the same thing.
Left hand gives Israel bombs and money.
Right hand gives Palestanians food and money.
Smart diplomacy…..
$400 million for Mahmoud Abbas and 50 billion for GM or the UAW must be cost-effective unlike Governor Jindal’s barrier islands idea.
The president’s answer on the Jindal proposal:
So let’s take the example of Governor Jindal’s barrier islands idea. When I met with him when I was down there two weeks ago, I said I will make sure that our team immediately reviews this idea, that the Army Corps of Engineers is looking at the feasibility of it; and if they think — if they tell me that this is the best approach to dealing with this problem, then we’re going to move quickly to execute. If they have a disagreement with Governor Jindal’s experts as to whether this would be effective or not, whether it was going to be cost-effective given the other things that needed to be done, then we’ll sit down and try to figure that out.
Sup?
The CNBC sock puppet said we would blow through 10,000 by a 100 points today. Perhaps BB needs to do a little chest thumping to make the street happy.
CNBC =
Chumps, Nothing But Chumps
Ummm…
The DOW closed at 9,899 today which was actually lower than yesterday.
Baaaaaaaaaadddd sock puppet. To the clothes hamper with you.
So, how does a nation compete with $26.00 PER DAY wages?
(Insert American Graffiti, plays Don Mclean)
“…Bye Bye Miss American Pie, drove my mexi-Chevy to the levee…
GM, Ford Boost Mexico Output With $26-a-Day Workers:
Average Wages
GM workers in Mexico earn wages and benefits of 340 pesos a day ($26.40) on average, or less than $4 an hour, said Tereso Medina, head of the union for GM’s 5,000 workers in Saltillo, a city that makes one in four Mexican autos. Ford workers in the U.S. earn about $55 an hour with benefits, compared with $50 an hour for Toyota Motor Corp.’s U.S. workers, Lewis Booth, Ford’s chief financial officer, said on a Jan. 28 conference call.
Chrysler announced in February it’s spending $550 million to retool its factory in Toluca to assemble the Fiat 500 model.
Last month, Ford reopened an assembly plant in Cuautitlan to build 2011 Fiesta cars. The factory will generate 2,000 jobs and is part of $3 billion in investments announced since 2008. In the U.S., Ford has closed four assembly plants since 2006 and plans to close four more facilities by the end of 2011.
It’s not that Mexican workers are underpaid, it’s just that US workers are way too overpaid with the cheap money.
I bet 340 pesos a day goes way much farther in Mexico than does $200 a day in US.
I bet 340 pesos a day goes way much farther in Mexico than does $200 a day in US.
You’d lose that bett. Most consumer goods cost about the same in Mexico as they do in the US.
The cost of living down there is not 1/10 of what it is here, not by a long shot.
Here are some prices:
Cooking oil, 1 liter: 28 pesos ($2 USD)
Tortillas: 10 pesos/kg (this is a subsidized price)
Milk: $12/liter. (over $3/gallon)
it goes on.
People labor under the belief that the cost of living is low in Mexico, and it is, if you don’t mind subsisting on rice, beans
and tortillas.
Drive through any Mexican border town, or even off the beaten path in a tourist area, and you can see how far the money goes.
I get Gringo Guilt every time I go to Mexico, and I am not by nature a sentimental type of person.
Last time in Mexico was Puerto Penasco at the height of the condo boom. Leave the resort area and drive into PP was a sobering experience. I guess now, with many of the Condo’s half finished and vacant its even worse.
And I get a snoot-ful of Gringo Guilt when I’m approaching Nogales, Arizona from the U.S. side. From I-19, the view of Nogales, Sonora is a view of the Third World crashing up against the First World.
Yes, I’ve been to Nogales a few times. Your description of it is as I’ve seen it. Quite a different world. I’m happy that my late mother at least was able to visit a foreign nation in her lifetime when we went. If she was alive today she would certainly be afraid to return over there - with all the increased tension and cartels over there.
I bet 340 pesos a day goes way much farther in Mexico than does $200 a day in US\
Go take a look at Juarez and get back to me
Oh, you have no idea, my friend. Have you heard of the terms “tourist price” and “local price”?
Americans aren’t overpaid if you consider the standard of living that
the middle class shouldn’t have to give up just so Big Business can pay their CEO’s millions of dollars for being traitors .
+1
You can always refrain from buying products made by GM and Ford.
I would say that Americans need to boycott car manufactures that build in other countries and sell here . Big business is simply taking advantage of lower wage workers . I am sick and tired of Americans having price fixing with high costs of living yet we are being undermined with low wage competition .
And here’s an idea for companies that do their manufacturing here: Promote it! Nothing wrong with saying that you’re making what you make here in the good old US of A.
I’ve been in favor of free trade if we could agree on protections for workers in other countries.
That would call for much higher wages as part of it. At least American minimum wage. Might stick them with health benefits too.
Course you could play some games with inflation/COLA.
I guess the Ford principle is dead.
Oh it will eventually happen. India and China wages will get parity to the US.
Use technological, human capital, and other (information (financial, distribution, manufacturing) processing, engineering, equipment, education, electricity and water distribution) advantages to be more productive.
Hello Chinese exports, good-bye U.S. jobs ~~ June 9, 2010
NEW YORK (CNNMoney.com) — For millions of unemployed Americans, the news about China’s surging export market isn’t necessarily cause for celebration, even if it might be a harbinger for global recovery.
Chinese exports surged 50% in May from a year earlier, easily trouncing expectations for a 32% increase, according to a Reuters report citing a leaked statement from a Chinese official.
This information is an unconfirmed sneak peak of China’s official trade report, which is expected to be released Thursday.
“The Chinese exports are still growing briskly and that implies that the world economy has thus weathered the financial instability in Europe,” said Moody’s chief economist John Lonski.
But Lonski also pointed out a negative side.
“The very high rates in [U.S.] unemployment are, in part, a consequence of the loss of jobs to less expensive manufacturing operations in countries such as China,” he said.
Has anyone trying to purchase right now come across this yet?
http://www.freddiemac.com/singlefamily/news/2010/0412_payoff_fraud.html
I have, with an “investor” trying to do exactly this scenario.
I called FreddieMac and reported him.
I have noted on listings that there is sometimes 3 different prices being listed for the same property on different sites .
‘Follow the Islamic way to save the world,’ Prince Charles urges environmentalists. ~ UK
Prince Charles yesterday urged the world to follow Islamic ’spiritual principles’ in order to save the environment.
In a high-profile speech, the heir to the throne argued that man’s destruction of the world was contrary to the scriptures of all religions - but particularly that of the Islamic faith.
He said the current ‘division’ between Man and Nature had been caused not just by industrialisation, technological development and the relentless pursuit of economic growth, but also by our attitude to our relationship with Nature - which goes against the grain of ’sacred traditions’.
This might not be the most popular thing for an American to say, but I find much to admire in Islam and in Muslims.
For one thing, you’d be hard-pressed to find friendlier or more hospitable people. That’s because hospitality toward the stranger is part of Muslim culture.
I agree with your post. My best ever girlfriend is Kuwaiti. We were together for three years. She would not wish bad on anyone. She even had Steven Cohen CDs (And Cohen is Jewish). I always have to educate people that not all Muslims want to kill or hurt non-Muslims. I think that most Muslims are basically afraid to condemn the vociferous bad element among them.
Islam had its peaceful era - its age of reason - when Christianity was in the dark ages.
I hope for a return to the age of reason by everyone.
Right after you, Prince.
It’s time for the US to get away from a debt-based / bank-based / financial engineering-based economy. Geithner and Bernanake have bank-centric views of the economy, based in part of the credit-fueled economy of the past 2 decades plus the fact they are/have been bank presidents.
Banking should be reduced again to merely a sector of the economy like any other service, instead of being the cornerstone. No sector should be allowed to hold the entire economy hostage.
A poster on Zero Hedge, John McCLoy, offered the following insightful comments on a recent appearance by Michael Pento, who called BS on Bernanke’s happy talk on the economy:
“I will take it one step farther from Micheal and say all those new home buyers who thought they were getting a bargain will find themselves underwater and will connect the dots very clearly to highlight his point:
* Housing had already fallen to a modest level. Only drastic intervention by the government and the holding back of an armada of housing inventory in exchange for not taking losses allowed more moderate stabilization in housing prices.
* The tax credit and illusion that home prices were stabilized induced those few with jobs and savings looking to buy homes to step in. I will also go as far as to say 35% of home “buyers” were the equivalent of day traders in real estate looking for a quick turn around flip. The flip mentality was still alive and some investors were unscathed so they push in believing what they see on the television that home prices are a bargain and hoping for additional demand in coming months since the stock market faked them into believing a recovery was around the corner.
* So even with all these buyers of perceived bargains we are still seeing home prices decline. Why is that? Unemployment is the answer. Without jobs no savings can be accumulated and homes cannot be purchased.
* Many previous home buyers have their credit decimated and cannot participate even if they would like to participate.
* Now we have an entire legion of those who preserved capital pushing into assets such as Real estate with intact credit about to find themselves underwater from new purchases about to have the rug pulled out from beneath them when banks finally unleash their armada of invetory. Then we see their capital evaporate, we see their tax credit disappear in one month as their home values fall and their credit destroyed. So now we have unscathed investors now scathed and now adding to the glut of inventory.
* So what happens since jobs are not being added and unemployment disappears? We see the velocity of money tank and begin to impair a new set of loans. As the market collapses and jobs fall we see increased pressure on small and medium sized business who then are forced to layoff more previously safe jobs and that is where it becomes interesting.
* These new previously safe jobs in service sector utopia America now begin to go on unemployment as their home values are falling and those who bought when they had jobs find themselves without jobs and find their new purchases underwater. Well with the number of Americans they are finding out are not paying mortgages and living rent free for a year they assume the small loss of their down payment and enter default and foreclosure maybe a year from now.
* As the credit markets seize we see credit card companies reign back their lending and credit limits to such scarce levels panic sets in with anticipation of consumers turning to their credit cards as a lifeline.(This has all been pointed out in ZH for months now that consumer credit is falling of a cliff) Credit lines have been used as welfare and minimum payments have been made.
* The real catalyst for unlocking financial armageddon is state and city jobs. We are seeing it now with teachers, municipal workers and transit that this fat needs to be cut to meet budgetary needs. There is no need to have 3 people sitting around doing the jobs that one can do. As these previously safe jobs are sucked out of the economy we will more small local business impacted since jobs which have been safe for decades are no longer in the consumer equation.
*Meanwhile we have 99′ers falling off claims in mass this summer for the first since this began and the steady 450 will fall off every month afterwards.
* Interest rates will rise regardless of Bernanke’s plans because money will become so scarce that capital will be given it’s rightly yield.
* We have record babyboomers retiring pretty much even where they were a decade ago (for now) withdrawing from the markets more than is being contributed through 401ks and pensions because without jobs there is no contribution. We do however have a legion of retirees who are ready to head to Boca.
* Incorporate the newly laid off turning to their 401ks for withdrawals that they are more than happy to take an early tax haircut on because they are eligible for “hardship” withdrawals since there is NO MORE CREDIT,NO MORE JOBS & NO MORE UNEMPLOYMENT CHECK.
It is the end of all things. The problem is there is no money.Only debt and by the time the real withdrawals come and home on the market rise 60%+ the markets will already be down below S&P 650 and just like that the “wealth & Savings” stored in the markets and homes evaporated in months and all the hardwork and savings along with productivity that went into those savings will be gone.
And then America will wake up and see where it all went and that it was extracted by banks and Wall Street long before they could take their money out of the ponz. We have spent trillions and changed accounting rules and accumulated debt at near retardation levels in the hopes that this time we would get it back to even and reorder the system but it has failed. And just like the central bank interventions in the Euro and the massive ramp jobs to squeeze shorts they are yielding small results and becoming less effective.
The only cure is healthy beautiful deflation and default and the return of jobs from overseas to America. See Wall Street believed they had found the secret to alchemy. They believed they could turn lead or paper into gold but even the man Isaac Newtown himself who discovered “What goes up must come down” after tireless efforts found alchemy to be impossible. The Wall Street profits were fraud and not alchemy all along. And all the Harvard degrees, connections and secret handshakes cannot turn paper into gold. You can paint the lead to look like gold but eventually it is discovered not to be gold.
So when anyone ponders why gold climbs in 2010 with all the technology we posses the answer is that it has and always will be a storage of productivity and wealth because you can engineer a flawless perfect diamond in a laboratory but you cannot create gold. You must mine it and it requires labor and there is a finite amount. Economics 101.
Home prices will fall to mid 1980s level..and then we will be cured.”
Don’t look now, but the highly contagious Greek worker flu has spread all the way to China.
The Financial Times
Chinese workers’ protests spread
By Tom Mitchell in Hong Kong, Justine Lau in Foshan and,Robin Kwong in Taipei
Published: June 10 2010 03:00 | Last updated: June 10 2010 03:00
Labour protests that have forced shutdowns at overseas-owned factories in China have spread beyond the country’s southern industrial heartland, posing a dangerous new challenge for Beijing.
Workers at a Taiwanese factory outside Shanghai clashed with police on Tuesday, leaving about 50 protesters injured. The confrontation represents an escalation of recent industrial action, which until this week had been largely peaceful and concentrated in southern Guangdong province.
The unrest suggests that industrial action is proliferating faster than local governments and the sole union allowed by the communist party - the All China Federation of Trade Unions - can resolve them.
There is no evidence that workers at different factories are co-ordinating their activities but the success of a strike at the transmission operations of Honda, the Japanese carmaker, has emboldened workers by demonstrating that mass action can yield results.
Workers have largely circumvented the official union in recent protests, another concern for Chinese leaders, who are quick to suppress any organisation outside of the ruling party.
Protests by workers are not uncommon in China but they have rarely happened in a concerted fashion in factories operated by multinationals like Honda and their affiliates.
…