November 22, 2010

Bits Bucket For November 22, 2010

Post off-topic ideas, links, and Craigslist finds here.




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385 Comments »

Comment by combotechie
2010-11-22 06:04:12

The HBB gold bugs have been rather quiet lately.

Comment by Ol'Bubba
2010-11-22 06:24:07

Last time I looked, precious metal oriented investments comprised about 7% of my net worth. I’m not looking to add more at the current market prices and the 7% allocation seems in line to me.

Comment by Professor Bear
2010-11-22 06:58:38

You don’t qualify as a “gold bug” in my book, as you are not frantically urging everyone to buy now before the dollar collapses, not to mention loading up on food and ammo, etc.

Comment by Jerry
2010-11-22 12:17:06

Hell of a lot better then keeping money in bonds, treu. etc all ready to blow up big time! Keep faith in the federal reserve. They are keeping your assests “safe”.

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Comment by pismoclam
2010-11-22 16:07:59

Here in California, you need to stock up on ammo by Feb 1,2011. At that time you need to fingerprint and background check for Moonbeam.

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Comment by Bill in Los Angeles
2010-11-22 08:17:07

I have 10.7% of my assets in precious metals after taking some money off the table. I also sold 25% of my company stock for a nice 16% short term gain. Sold EVEP for a 55% long term gain (held just a little over a year). So I’m sitting on a lot of cash.

I like my rebalancing strategy for precious metals.

I’m going to buy a 2007 or 2008 Ford Mustang (V8) once I’m settled in Tampa - in January I should get an apartment. The 5.0 liter 2011 GTs are out, and they are pushing the prices down on the older models.

I want something to make my Deep Purple and CCR sound good in! Will sell it back when I’m done with my engineering assignment in Florida - in a year or longer. It is less expensive than renting a car every week, I found.

Comment by oxide
2010-11-22 08:24:51

So now you’re going to be Bill in Tampa! Thanks for telling us in advance.

Even with your new location, I do hope that you continue to inform the rest of us that if we had only lived single, had luckily chosen an in-demand sector of the computer programming field, had moved every two years like a hobo, had given up a family, and had a swimmer’s body, that we too could be as wealthy and successful and wonderful as you are.

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Comment by Rancher
2010-11-22 09:33:38

Different strokes, don’t knock it.

 
Comment by waiting_in_la
2010-11-22 11:45:35

That about sums it up, doesn’t it?

 
Comment by Steve J
2010-11-22 12:24:50

I thought hobos were always on the road?

 
Comment by pressboardbox
2010-11-22 12:47:34

I have 10% of my assets invested in gold (at least the guy at the flea-market said the thin little chain was gold). The rest is in cash (three ones, a fiver, a ten, and six twenties - was told to diversify heavily). I feel pretty good going into this thing.

 
Comment by Blue Skye
2010-11-22 14:13:23

Pressboard, you really need to spread that out a little. Maybe a can of beans?

 
 
Comment by Professor Bear
2010-11-22 08:35:17

I’m jealous of your freedom to pull up the tent stakes and relocate across the country where real estate prices are more reasonable. Hopefully enough other folks will be similarly mobile to help the national U.S. real estate market reach a new fundamental-based price equilibrium.

One thing the folks who are trying their damnedest to prop up housing prices never seem to acknowledge is how much damage to the U.S. economy results from the inability of workers to relocate due to prohibitively high housing prices where the jobs are. Your story offers hope that prices have bottomed out sufficiently in at least some parts of the country to allow the local labor market to recover, thanks to an influx of qualified workers seeking affordable housing.

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Comment by ann gogh
2010-11-22 09:12:24

My prop manager just told me I’m month to month! cheers for annie!

 
Comment by oxide
2010-11-22 09:25:34

“inability of workers to relocate due to prohibitively high housing prices where the jobs are.”

Or due to prohbitively low prices Where The Jobs Aren’t, so they can’t sell.

Also please don’t forget that rental housing is also very expensive Where The Jobs Are. I just renegociated my rent with my landlord, and it wasn’t pleasant. My area has a lot of 1) military on housing coupons 2) Section 8, and the landlords rasie the rent to accomodate that. Regular folks who live without subsidies have to comply with the rent increases, or they are “invited” to find another place to live for that price. (they said this to me) The only way to retain a steady rent is to move every year and take advantage of free-month move-in specials. That’s a pain and they know it.

We at HBB predicted that people will all move in just to afford the rent — well we were right. Sometime next year I may consider getting a roommate myself. but shacking up in general won’t help the situation. Landlords will salivate over that second income and raise the rent anyway… a variation on E. Warren’s Two Income Trap. It will never stop.

 
Comment by Spook
2010-11-22 09:41:56

” My area has a lot of 1) military on housing coupons 2) Section 8, and the landlords rasie the rent to accomodate that. Regular folks who live without subsidies have to comply with the rent increases, or they are “invited” to find another place to live for that price.”

Oxide, don’t forget to include all the “illegals” in your list?

they maintain much of the rental price pressure; years ago there were lots of cheap places to live in dee cee if you didn’t mind doing some cleaning and fixing… which resulted in reduced rent.

Now they just stuff a bunch of Illegals in em and keep the rent high

 
Comment by polly
2010-11-22 10:51:33

Oxide,

You are now DC area, right?

Have you seen the Montgomery recommended rent increase guidelines?

http://www.montgomerycountymd.gov/dhctmpl.asp?url=/content/dhca/housing/landload_T/rent_guide.asp

My old place raised the rents even faster than the recommended increase while claiming they didn’t. I wonder if they incorprate the rent breaks for moving in in these calculations….they are from some independently generated statistic, but move in incentives may not be included.

 
Comment by oxide
2010-11-22 11:15:41

Polly, yes, indeed I did. I had to enlist the help of the City to renegotiate my rent. The landlord negotiated some, and then “invited” me to find a better price if I could. I was okay with the “some.” The guy from the City was pretty p-o’d at the landlord and is keeping an eye on them. The City can make life miserable for the landlord with inspections, infractions, and the like.

The City is where I got the info about the military and Section 8’s.

 
Comment by polly
2010-11-22 11:56:01

the “City”? A landlord tennant board or someone at your actual cityhall?

 
Comment by Jim A.
2010-11-22 12:58:22

There ARE some actual municipalities in Maryland. I’ll tell you that in College Park, the rules on landlords are pretty strict. Of course this isn’t so much to protect poor college students from rapacious landlords as to make renting out to a bunch of students un-economic and allow the rest of us to live quieter lives.

 
Comment by Prime_Is_Contained
2010-11-22 15:31:54

“Have you seen the Montgomery recommended rent increase guidelines?”

I’m confused—why would the county publish recommended rent increase guidelines?

 
 
Comment by mikey
2010-11-22 08:43:18

“I’m going to buy a 2007 or 2008 Ford Mustang (V8) once I’m settled in Tampa - in January I should get an apartment. The 5.0 liter 2011 GTs are out, and they are pushing the prices down on the older models.”

Why Bill ?

The actual speeds in and around the Tampa area run about 27-45 MPH.

Get behind an Granny in her decked out 1963 Caddy or a really rich old geezer in his 458 Ferrari Iltali showing off his newest 22 yr old “niece” …then figure 17 MPH if you are lucky.

Note: Geezer mileage may vary depending if she wants to Go Shopping again.

:)

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Comment by Diogenes (Tampa, Fl)
2010-11-22 09:52:11

“The actual speeds in and around the Tampa area run about 27-45 MPH.”

You must be traveling I-275, in between the stoppages of traffic. I’ve almost made it up to 45 MPH on many occasions.
You must be getting better travel times.
Mostly it’s 0-30 MPH around the core travel areas.

The ridiculous traffic patterns from the re-design of “malfunction junction” have done nothing to alleviate the backups during peak hours.

Thank you, DFOT, for your astounding methods of bottle-necking traffic at key junctions. Only you could put a drop-off lane in the middle of converging traffic, in multiple places, in and about the main traffic arteries. Brilliant!!

 
 
Comment by AvOcadO
2010-11-22 11:21:46

Your investments are smart, except for the Mustang rattle box with ridiculous depreciation. I would go with an older BMW M3, faster and holds its value.

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Comment by The_Overdog
2010-11-22 12:36:52

And will cost 50% of its value in repairs and new tires every year.

 
Comment by Spokaneman
2010-11-22 12:46:13

A guy at work was crowing about his new BMW holding its value so well. Said that after three years and 50K miles the car would still be worth 70% of the $65K he paid for it (not including sales tax).

I pointed out to him that if he bought a $18,000 car that would worth 30% of its original sales price after the same period, he would be financially way better off.

The BMW will cost about 50 cents a mile in sales tax and depreciation while the $18,000 car will only cost about 30 cents a mile.

I will agree the BMW looks better though.

 
Comment by waiting_in_la
2010-11-22 13:24:04

I have been toying with the idea of buying a used beemer for the same reason. But, I’m slightly worried about looking like a douchebag.

 
Comment by In Colorado
2010-11-22 13:26:25

Given that the Beamer will lose almost 20K of its value he would have been way better of with a 20K (or even a 30K) car.

But I suppose it made him feel like a “winner”.

 
Comment by ecofeco
2010-11-22 15:40:48

3 words on older high end German cars: import parts. labor.

 
Comment by Rancher
2010-11-22 16:59:14

Metric Allen heads

 
 
Comment by In Colorado
2010-11-22 11:33:29

“I’m going to buy a 2007 or 2008 Ford Mustang (V8) once I’m settled in Tampa.”

I’m disappointed that the latest and greatest Mustangs still have a solid read axle (what is this? 1950?). I had a 97 GT once (a lot less power than the new ones) and I found the solid rear axle to be a pain sometimes.

As Richard Hammond (of TopGear) once said of the GT’s solid rear axle: “it’s like trying to walk with your shoes tied together by the laces. It can be done, but there are better ways of getting around.”

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Comment by X-GSfixr
2010-11-22 14:06:39

For every Mustang that sees a road course (and can use a IRS), about 50 are drag/street raced (excuse me, I meant “exhibitions of acceleration”). A solid axle is cheaper to start with, and a lot cheaper to fix, if you trash it. Which will happen, especially if you race it with slicks.

The new Challenger has IRS. If you start putting power adders on it, you might as well budget for a new new ring and pinion, heavier duty half-shafts, etc.

Doesn’t the GT 500 have an IRS? It also costs about $15K more, last time I checked.

 
Comment by In Colorado
2010-11-22 16:11:12

Well, I never dragged my GT. But I had the rear bust loose over a bumpy road while I was zipping through a curve. Not fun.

It did corner fine, as long as the road was mirror smooth.

 
Comment by REhobbyist
2010-11-22 17:41:19

My great uncle Bill bought a 1965 Mustang at the age of 63. He was a bachelor who worked at the steel mill and lived in our basement in Detroit. I never thought they could be cool if uncle Bill wanted one.

 
 
Comment by lavi d
2010-11-22 13:12:52

…we too could be as wealthy and successful and wonderful as you are.

Wow, I must have missed a couple of episodes.

Why all the negative love* for BiLA, oxide?

(*NAR term)

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Comment by REhobbyist
2010-11-22 17:39:09

OK, does anybody on this blog beside Bill and me know who Deep Purple were? I had almost forgotten their existence.

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Comment by Go East
2010-11-22 20:19:18

Smoke on the Water and Hiway Star. Who could forget (that was of a certain age in the late 60’s, early 70’s)?

 
Comment by rms
2010-11-22 20:55:23
 
 
Comment by Bill near tampa
2010-11-23 19:49:22

I moved from LA in 1980. Lived in Santa Monica and Sherman Oaks mostly. I’ve never been back. You’ll probably love Tampa. Few problems, traffic not bad, no state income tax, etc. I think the beaches are nicer, especially Clearwater with its white sand, and they’re not freezing like the water around LA. However, unlike LA, older people tend to live at the beach, not young. No muscle beach or skateboarding sidewalks or surfing. But check out Ybor city at night for young street crowds. Quite a zoo.

Over all, not as much to do here as in LA, but that’s true of most places !

Oh, and housing costs 1/2 of LA or less.

Good luck to you.

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Comment by mariner22
2010-11-22 06:57:39

We are busy buying the dips. Unless you feel that quantitative easing is really going to improve the US financial situation, I can see only more and more money printing in the future. When unemployment is still 9% + and the budget deficit $1.5 trillion in the Spring, do you really think Benny is going to “stop” building the balance sheet? I think he will be forced to follow Paul Krugman’s advice, and up the ante - perhaps doubling the 3 trillion balance sheet to “shock and awe” the markets disregarding the failed improvement to date. The real money will be made as more and more people come to the conclusion that the current QE2 program will not work.

On the other hand, if you believe the economy is turning around, the Fed will announce shrinking its balance sheet and canceling QE2 and the US budget deficit will decline significantly due to either austerity or increased revenues due to economic prosperity then by all means, sell gold!

Comment by Blue Skye
2010-11-22 07:29:53

We all take these issues seriously, though interpretation of the Rorschach inkblot test that is our government varies. I suspect that the current trends will not extrapolate to infinity, so have to consider a different scenario as possible a few years out. This QE2 thing you mention, I don’t think it is increasing the money supply at all. It is very focused and limited sponging while the body is hemorrhaging from head to toe. Let the Fed put everything in the universe on its balance sheet, it will not make that crap good and it will not make it easier for people to earn money.

I keyed on your comment about “making a killing”. This mindset puts you in a position to get your throat cut.

Comment by Steve J
2010-11-22 08:13:36

That money will leak out eventually…probably in places nobody ever suspected.

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Comment by Al
2010-11-22 09:18:09

And of course, how much QE is already ‘priced in’ to current gold prices.

 
 
Comment by Professor Bear
2010-11-22 08:14:39

You should also consider the possibility that he is trying to line up greater fools to buy his shiny yellow metal when the price is sky high.

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Comment by Diogenes (Tampa, Fl)
2010-11-22 09:54:03

“We are busy buying the dips.”
I am busy selling the peaks. It’s good to have a market where there are 2 sides to every trade. Good luck with your strategy.

 
 
Comment by edgewaterjohn
2010-11-22 08:10:25

Agent Provocateur!

 
Comment by RioAmericanInBrasil
2010-11-22 15:51:45

The HBB gold bugs have been rather quiet lately.

I’m not sure lately of how gold-bugs even define “lately”.

http://www.kitco.com/charts/popup/au3650nyb.html

 
Comment by technovelist
2010-11-22 18:02:32

The HBB gold bugs have been rather quiet lately.

Maybe the “gold bugs” have concluded that there’s no amount of evidence or logic that will convince someone to buy gold if they haven’t figured that out already, given the monetary and fiscal insanity that is raging around us.

But I must say there is an upside to the fact that even such otherwise sensible and independent thinkers as we have here still don’t understand gold. That means we are very far from anything that could remotely be considered a bubble.

And no, 10% of your assets in gold won’t protect you from the firestorm. It’s better than nothing, but not nearly enough.

Comment by Professor Bear
2010-11-22 20:34:16

“…given the monetary and fiscal insanity that is raging around us.”

Here are three questions for true believers in The Precious™ to answer:

1) Do you believe the future level of monetary and fiscal insanity is likely to be higher or lower than the current level?

2) Do you believe a lower level than current would help to support or to suppress the value of The Precious™ relative to substitute asset classes?

3) Do you believe it is different this time, or will The Precious™ face another two decade long correction after the current bubble pops?

Comment by technovelist
2010-11-22 20:40:15

1) Do you believe the future level of monetary and fiscal insanity is likely to be higher or lower than the current level?

Higher.

2) Do you believe a lower level than current would help to support or to suppress the value of The Precious™ relative to substitute asset classes?

There is no escape other than through deflationary collapse or hyperinflation. I’m betting on the latter, but the former will ruin all creditors who have dollar claims. That will be good for gold too.

3) Do you believe it is different this time, or will The Precious™ face another two decade long correction after the current bubble pops?

It is different this time, because they have run out of tricks to delay the collapse of the hollowed-out economy. There isn’t any more seed corn to eat or burn.

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Comment by Professor Bear
2010-11-22 23:05:08

You are indeed more pessimistic than I am. My best guess is that things looked similarly bad to now in the 1975-1982 period, then settled down considerably, at which point gold lost its luster.

I am guessing something similar is on the way this time…

 
Comment by technovelist
2010-11-23 11:25:45

There are a few differences between then and now. For example, in that earlier period, the US was the world’s largest creditor. Now it is the world’s largest debtor.

But more important, as Ludwig von Mises famously noted, there is no way of preventing the contraction after a credit expansion. There are only two questions: how long it can go on and whether the contraction is as a result of voluntary actions or the total destruction of the currency. They have been kicking the can down the road for at least the last 40 years (since the 1971 repudiation of the US’s promise to pay gold for dollars at $35/oz), and I believe that we are in the endgame now.

I’m betting on the destruction of the currency, as that is the “plan” that Bernanke is following. But either way, dollar claim-holders are in tremendous danger that they don’t understand.

 
 
 
 
 
Comment by jeff saturday
2010-11-22 06:04:23

3rd-Qtr Mortgage Delinquency Jumps in Northeast

Late mortgage payments rise sharply in 3rd qtr in Northeast; nationwide rate increase slows

By EILEEN AJ CONNELLY AP Business Writer
NEW YORK November 22, 2010 (AP)

“The whole Northeast is experiencing a little bit of an increase,” said FJ Guarrera, vice president in TransUnion’s financial services business unit. Because the spikes were only seen for one quarter, it’s too early to tell if they represent a new trend.

“We’ll keep an eye on the Northeast, but there’s no evidence yet that there’s a problem brewing,” he said.

http://abcnews.go.com/Business/wireStory?id=12208727 - -

Comment by Albuquerquedan
2010-11-22 09:10:13

I think that the Northeast house prices are probably the most out of line given the long term migration trends, aging populations and the income to price ratios. Sooner or later many people in the East will still be moving South and West and selling their houses even if they cannot get peak prices for their homes.

Comment by polly
2010-11-22 11:05:24

Why do people who live in the South and the West all assume that people who live in the Northeast want to join them?

Comment by GrizzlyBear
2010-11-22 11:11:25

As a west coaster, I love the NE. The greenery is wonderful. I think I’d be right at home in Maine.

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Comment by theoracleofnebraska
2010-11-22 11:17:59

Warm Weather. Don’t get me wrong when you are retired and not working, cold feels much worse.

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Comment by Doug in Boone, NC
2010-11-22 21:36:32

“Warm Weather”
If that’s what you are looking for, don’t move to this area, even though it is a part of the “Sunny South.” Right now, I’m having to build a fire in the ol’ woodstove to keep the house warm!

 
 
Comment by In Colorado
2010-11-22 11:34:55

“Why do people who live in the South and the West all assume that people who live in the Northeast want to join them?”

Because so many already have?

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Comment by polly
2010-11-22 12:02:50

Then why not assume that those who want to go have already gone? This is an actual question not a disguised criticism.

I just don’t get why people assume that their preferences are universally shared. I’d go nuts if I was too far from a significant cultural center, but I have no illusion that everyone wants to have access to weird theater and lots of museums all the time. Why do others assume that I want to live in their heat?

 
Comment by In Colorado
2010-11-22 12:56:28

I was joking. Of course not everyone wants to move out west (and thank goodness for that!).

FWIW, at lot of cities in the “West” have museums and theatre and stuff like that.

What we are short of is WATER. So please don’t move out here.

 
Comment by Arizona Slim
2010-11-22 13:14:57

What we are short of is WATER. So please don’t move out here.

Thank you!

BTW, here in Tucson, there’s this city-wide talking shop starting. It’s called Imagine Greater Tucson, and they’re all over KXCI with PSAs inviting people to community conversations.

What really gets me bellowing is the assertion that Tucson’s population is expected to grow by 50% during the next few decades, so we’d better plan. “Where’s the water going to come from?” is what I’ve been hollering at my radio.

Reason for the question: This is a desert.

 
Comment by potential buyer
2010-11-22 15:09:43

broken bones taken longer to heal after slipping on the ice?

 
Comment by lavi d
2010-11-22 16:30:57

Tucson’s population is expected to grow by 50% during the next few decades, so we’d better plan.

Get out! Tucson still thinks it’s going to keep growing as it has in
the past?

The main reasons people moved to Tucson in the past were warm weather (retirees) and jobs (younger folk)

Well, the baby-boom bulge is just about past and the days of moving west and starting a masonry/ironwork/cabinet business on a shoestring with a GED are gone for the time being.

For the entire 25 years I lived in Tucson, the chant “Growth, Growth, Growth!” was incessant from one side of the city elder’s mouths. From the other side came the refrain, “We need more money for roads, schools and services!”

I always yelled back at the TV/Radio, “When does the Growth start paying for itself?”

 
 
Comment by Spokaneman
2010-11-22 12:47:51

Anecdotal evidence.

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Comment by MazNJ
2010-11-22 12:55:41

I eagerly await price corrections.

The lower priced homes (towns with significantly lower than median income) are still significantly overpriced. Median income home prices are still overvalued but not as ridiculously as the crapshacks. Once you get into the higher end homes (surpass 500k), you start seeing more in line home prices and then in the former 700k+ range, prices have come down significantly, but many of those deals fall through (attempted short sales).

Oddly enough, in Monmouth County NJ, I just have seen that many sales related to foreclosure despite seeing tons of lis pendens.

Comment by exeter
2010-11-22 17:27:29

Good article Jeff.

And look what the liar in the article states;

“We’ll keep an eye on the Northeast, but there’s no evidence yet that there’s a problem brewing,” he said.

Gee…. your vigilant eye doesn’t seem to view reality like the rest of us.

“Problem brewing”? You’re an idiot.

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Comment by jeff saturday
2010-11-22 06:12:08

Problems abound for vacant homes’ neighbors
Especially for residents sharing walls with abandoned properties, issues can mount quickly

November 15, 2010
By Jamie Smith Hopkins, The Baltimore Sun

The abandoned rowhouse next door to Wendy and Brian Malaney has been a nightmare of a neighbor.

The rowhouse’s roofing material blew off, and water seeped through the Malaneys’ adjoining walls. Later the pipes burst in the neighboring property, flooding their basement. The air they and their two young daughters breathe is now heavy with the noxious stink of mold.

The Malaneys say they have no way to cover the thousands of dollars needed to repair their own home. The vacant property’s owner has not stepped forward to fix the damage. Neither has the bank, which decided against foreclosing on — and taking possession of — the property. The Malaneys say insurance hasn’t covered the cost of remediation — and now they are stuck.

http://articles.baltimoresun.com/2010-11-15/business/bs-bz-vacant-home-problem-20101112_1_vacant-homes-vacant-properties-uninhabitable-properties - 31k -

Comment by 2banana
2010-11-22 08:35:43

Last fiscal year, the city spent about $435,000 to stabilize 13 abandoned homes to safeguard neighboring residents,

WOW - that is $33,500 per house to “stabilize” them.

Wonder what the houses were worth in the first place?

FYI - the 2banana house got some upgrades in the last two years.

New roof, 2 new bathrooms, new furnace, insulation and some new windows. I did not go for the granite countertops in the kitchen, Total - about $25,000. Of course, I did not have to pay city union wages/benefits/pensions…

Comment by scdave
2010-11-22 09:12:16

WOW - that is $33,500 per house to “stabilize” them ??

How much are a box of matches ??

 
Comment by Steve J
2010-11-22 09:56:41

The price of those houses are still down from their peak when F. Scott Fitzgerald lived there.

 
 
Comment by Professor Bear
2010-11-22 08:49:28

“Problems abound for vacant homes’ neighbors”

Sounds to me like we need lower prices so the market can find owner-occupants to fill all those vacant homes. Unsustainably-overpriced housing results in a surfeit of vacancies.

Comment by Diogenes (Tampa, Fl)
2010-11-22 09:59:25

Lower prices are bad - Ben Bernanke.
High price good. Must inflate. Must print money. Must inflate.

 
 
Comment by Doppler
2010-11-22 09:50:18

And this is why I will never purchase a “duet” home.

Comment by oxide
2010-11-22 11:18:17

If you live in DC, then you should be prepared to fork over a half mil. If not, look foraward to attached product, because that’s ALL they build.

Comment by polly
2010-11-22 12:05:13

You can find stand alones for less than $350K in Silver Spring even. But I wouldn’t vouch for the condition or the previous uses.

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Comment by Diogenes (Tampa, Fl)
2010-11-22 09:57:02

The vacant property’s owner has not stepped forward to fix the damage………yea, like nobody could have seen that as a distinct probability.

 
Comment by REhobbyist
2010-11-22 17:45:01

This is why lawyers were invented, Wendy and Brian. Banks have deep pockets.

 
 
Comment by combotechie
2010-11-22 06:15:21

A Yahoo Finance headline:

“Greece’s Governmnet May Shut Down on Cash Shortage, High Frequency Says.”

Cash: Completely worthless unbacked pieces of paper deemed by many to be not good for anything … (except, perhaps, financial survival).

Those who have cash get to buy things they need; Those without cash get to watch.

Comment by mariner22
2010-11-22 07:04:32

Combotechie -

Greece cannot print its own money! Many people think the only answer to Greece’s problem is to leave the EU and start printing its own currency leading to radical devaluation and hopeful economic improvement.

Greece is stuck in the same situation that the US would be if say, we went back on the gold standard. Benny couldn’t just create $600 billion out of thin air - he’d have to mine it. Or perhaps if foreign business demanded payment in Swiss Francs.

If the US wanted to say, extend unemployment benefits and call a payroll tax holiday, cash would be much more plentiful to the masses - this would be more “fair” than giving it to the bank but does anyone really think we wouldn’t get hyperinflation. The only thing keeping inflation in check is all the printed money is going to the banks who hoard it in their vaults rather than loan it out to businesses. I don’t believe the political establishment can maintain this charade especially as all of the States dismantle their safety nets and unemployment remains high.

Comment by combotechie
2010-11-22 07:32:03

“I don’t believe the political establishment can maintain this charade especially as all of the States dismantle their safety nets and unemployment remains high.”

“… all the States dismantle their safety nets and unemployment remains high” translates to LESS MONEY going into circulation, which is DEFLATIONARY.

Comment by Steve J
2010-11-22 08:17:12

States have plenty of other things to waste money on.

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Comment by Doug in Boone, NC
2010-11-22 21:47:11

“40 million Americans on food stamps”
Wouldn’t that sort of cancel out cuts in SS and medicare?

 
 
Comment by mariner22
2010-11-22 10:34:28

While Ron Paul, Peter Schiff et al call for the tough austerity measures which would dismantle some of the safety net, I really doubt the American political system will make the painful changes - cut social security, medicare, medicaid, pensions. 40 million Americans on food stamps?

Nations with no choice have austerity measures imposed on them. The US does not (at least for now). The easy way out is to print money. In the 1930s the dollar was worth 1/35 an ounce of gold. In the 1980s the dollar was worth 1/800 an ounce of gold. In 2010 the dollar is worth 1/1350 an ounce of gold. Will this trend continue? I guess if I really wanted to hold lots of cash I would diversify into other currencies….

Perhaps too simplistic an analysis, but there are some very smart people holding this view (Jim Grant, Jim Rogers, Peter Schiff, John Paulson, Kyle Bass)….stay tuned.

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Comment by technovelist
2010-11-22 18:07:15

I guess if I really wanted to hold lots of cash I would diversify into other currencies….

I suggest metallic currencies.

 
 
 
Comment by measton
2010-11-22 09:18:51

only thing keeping inflation in check is all the printed money is going to the banks who hoard it in their vaults

They have a lot of bad loans on their books. A lot of apparent cash is disappearing.

Comment by combotechie
2010-11-22 09:36:15

“They have a lot of bad loans on their books.”

And more bad loans yet to come.

“A lot of apparent cash is disappearing.”

There it is. Cash is disppearing dollar-for-dollar in lock-step with the disappearance of the collateral that backs the bad loans.

Collateral is what backs loans. Price is what determines the value of collateral. If price declines then it takes collateral down with it, and when collateral is taken down the loans backed by this collateral is also taken down.

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Comment by In Colorado
2010-11-22 07:06:46

Or riot.

Even in a hyoerinflationary economy cash has its value, you just don’t want to hand on to it very long. Lots of velocity I guess.

 
Comment by technovelist
2010-11-22 18:06:07

Those who have cash get to buy things they need; Those without cash get to watch.

True, depending on your definition of “cash”. I have almost no Federal Reserve Notes and yet I have no trouble buying whatever I need.

That’s because I can trade my preferred cash (gold, in case you were wondering) at any time I wish, for whatever pieces of paper anyone wants to use for transactions.

 
 
Comment by jeff saturday
2010-11-22 06:22:15

Percent of Americans likely to rent their next home grows, survey indicates

By Mary Umberger
November 21, 2010

My nominee for word of the year is “cautious.”

It comes up in every discussion of current consumer behavior, particularly in regard to housing. The most recent usage to cross my desk popped up in a new report from Fannie Mae.

Nonetheless, the percentage of Americans who said their next home would probably be a rental has grown to 33% from 30% since a similar survey came out in April. And 60% of those who rent said they’d continue to do that rather than buy a house if they were to move, up 6 points from April.

http://www.latimes.com/business/realestate/la-fi-umberger-rent-20101121,0,3514894.story - 156k -

 
Comment by combotechie
2010-11-22 06:27:12

Another Yahoo Finance headline:

“Top banks face $100 billion Basel shortfall: report.”

LONDON - The new Basel III banking rules will leave the biggest U.S. banks short of between $100 billion and $150 billion in equity capital, with 90 percent of the shortfall concentrated in the top six banks.”

Pooooof.

Luckily we have have a policy of Extend & Pretend else our banks would REALLY be in trouble.

Comment by jeff saturday
2010-11-22 06:49:45

The little printing press that couldn’t.

Comment by edgewaterjohn
2010-11-22 08:33:06

Bennie should have turned it over before he bought it, then he might have seen the label: Made In Japan.

Comment by Blue Skye
2010-11-22 08:41:29

LOL

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Comment by In Colorado
2010-11-22 09:35:06

He should have bought a Zimbabwean printing press.

If he wants inflation all he has to do is mail a $50,000 check to every household in the country.

The problem is that he wants inflation AND for all the money to end up in the hands of the top 1% (which it would eventually)

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Comment by GrizzlyBear
2010-11-22 11:07:50

I was talking to a guy who was actually suggesting that sending $25,000 to every person in this country would fix things. I just shook my head in amazement.

 
Comment by In Colorado
2010-11-22 11:44:51

There would be brief period of euphoria.

When I lived in Mexico in the 70’s and 80’s government employees (some who were not paid all that shabbilly) would get a 3 month year end bonus (Private sector workers “only” got 15 days pay, and this was by law).

Needless to say around Christmas anyone who had a non menial job partied like it was 1999.

I believe that gov’t worker bonuses have been reigned in since then and they also now get a “mere” 15 days of extra pay.

 
Comment by Spokaneman
2010-11-22 12:55:35

It was the same way back in the day when Alaska Oil Royalities were distributed and were large enough to mean something.

I happened to the in Chatanooga a few years back during the week that “Little Debbie” distributed their annual bonuses, which apparently are quite large and widely distributed. The papers were chock full of advertisments for all manner of consumer goods for the bonus receipients to spend their money on.

 
 
 
 
 
Comment by 2banana
2010-11-22 06:47:40

The entire country of Ireland was sold into debt slavery over the weekend.

Is there not one country in the world (with the exception of Iceland) that will tell this bankers:

1. You took these insane risks
2. You paid yourselves handsomely when times were good
3. You must accept the accept the consequences when your risky bets did not work out
4. You are bankrupt
5. Your stock holders will be wiped out
6. Your bond holders will be wiped out
7. You bonuses will be wiped out
8. And you are going to jail
9. And we are going to capitalize new banks with clean balance sheets and honest men to run them
10. And F*ck you

Comment by theoracleofnebraska
2010-11-22 11:23:18

As long as there’s a government, the banks will get paid.

Comment by palmetto
2010-11-22 11:40:05

Thank you, oracle. That’s all anyone needs to know. I firmly believe this is the basic function of govmint these days.

 
Comment by Professor Bear
2010-11-22 20:39:23

I may suffer from misplaced optimism, but it seems to me the U.S. populace (at least the educated class thereof) is turning against the banks. For now, politicians are paying lip service to standing up to the banksters; once they feel sufficient political pressure, perhaps they will fell compelled to back up their rhetoric with action? I am holding out hope, as most of the U.S. is just waking up to the facts regarding how much the banksters have collectively stolen from us.

Comment by neuromance
2010-11-22 21:55:12

The “Socialize the losses, privatize the profits” model works to slowly bleed the society, until the politicians and banksters become too rapacious.

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Comment by oxide
2010-11-22 11:31:12

+1 banana.

We could do this if only the banks were’t Too Big To Fail…

 
Comment by Jim A.
2010-11-22 13:05:52

And 9. is the real question. Would it be cheaper to capitalize NEW banks rather than pump money into old banks with negative net worth?

Comment by X-GSfixr
2010-11-22 14:59:07

Which is what “TARP” should have been.

Let the vampire squids turn into calimari, give/loan the survivors money contingent on the government getting a share of the profits; if needed, open several regional, USA-owned “First USA Bank” that will be sold in, say three years.

But the problem is that this will allow the chickens to roost where they should have to begin with.

Comment by Professor Bear
2010-11-22 20:40:26

I love the taste of fried calimari!

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Comment by exeter
2010-11-22 17:31:26

“10. And F*ck you”

Do all you evangelicals speak this way?

 
 
Comment by theoracleofnebraska
2010-11-22 06:50:30

Does anyone know when the mark to market accounting will be enforced again? It’s been suspended for a while I believe, no?

Comment by Rancher
2010-11-22 09:38:37

For you, now.
For the banks, never.

Comment by ecofeco
2010-11-22 16:04:16

Exactly.

 
 
Comment by Diogenes (Tampa, Fl)
2010-11-22 10:03:27

They can’t do it until the FED buys up ALL the mortgage loans and keeps them as assets. If the banks need to post any of their real estate portfolio at current market prices, they are ALL insolvent.
We just can’t have that, as the STOCK price of GS, JPM and the others would go back down where it was in 2007.

Do you want another financial panic?

Comment by pressboardbox
2010-11-22 12:53:08

Heavens no. GIve them whatever they want so they can save us.

Comment by REhobbyist
2010-11-22 17:48:43

Yes, because they’re doing God’s work.

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Comment by Boise IDaho
2010-11-22 06:59:53

Unemployment is the big factor and as we move into the Holidays it is very stressfull.

Comment by 2banana
2010-11-22 07:04:17

And maybe not…

In Entitlement America, The Head Of A Household Of Four Making Minimum Wage Has More Disposable Income Than A Family Making $60,000 A Year

Comment by cobaltblue
2010-11-22 07:12:36

Due to a server time warp and posting a link,
my submission on the same topic will probably come up later. People should do the math before calling this a political topic. The numbers are there to support the arithmetic conclusion that a family of four with one wage earner at minimum wage has more disposable income than the same family with a $60K/yr wage earner after adding entitlement benefits and subtracting taxes.

Comment by Blue Skye
2010-11-22 07:40:17

Not to mention the expenses of keeping up the “lifestyle” and commuting to an office. I often calculated that I’d be better off financially with no job, no car, and no house in the burbs, just a little garden and time on my hands.

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Comment by polly
2010-11-22 08:34:37

I saw an analysis once that universities with significant income streams from grants would be better off finanically without students, or at least without undergraduates. They might still need a few graduate research assistants, but the undergraduates did not help if you considered all the expenses of having large numbers of students on campus - police, housing, health care, recreation, sports, job placement, babysitting helicopter parents, etc.

 
Comment by DennisN
2010-11-22 08:53:23

I once read that a Supreme Court Justice said that being on the Court was all the fun of practicing law without the bother of dealing with clients. :lol:

 
Comment by Steve J
2010-11-22 12:30:21

Many state schools limit enrollment to maximize the “profit” from state funding.

 
 
Comment by alpha-sloth
2010-11-22 07:48:06

Just goes to show we need a universal single payer health care system. It’s medicaid that skews the numbers in the example given.

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Comment by Blue Skye
2010-11-22 07:53:51

Does that mean that one person pays for the entire universe?

I don’t trust anything that requires a new vocabulary to get on board.

 
Comment by Arizona Slim
2010-11-22 07:58:51

Just goes to show we need a universal single payer health care system.

In August 2009, I visited my aunt in northern Vermont. During my visit, we attended a health care town hall hosted by Sen. Bernie Sanders. The Vermont for Single Payer people were out in force, and believe you me, their message was very well received. Sanders is a longtime single payer advocate.

There were/are single payer bills in both houses of the Vermont legislature. It’s very likely that they will be signed into law by Vermont’s new governor, who has stated that he will make single payer a priority.

So, in short, it’s coming to America.

 
Comment by Steve J
2010-11-22 08:26:39

I think a repeal of Obama’s healthcare legislature will make single payer even more popular.

 
Comment by oxide
2010-11-22 08:33:51

Do you have links, Slim? I’d be interested to see how this is different from the insurance mandate currently in Massachusettes. If Single Payer works in Vermont, maybe Congress* will use it as a model and justification for at least a Public Option nationally. Especially when the private insurers squeeze even more blood out of the sick.

————–
*I’m looking especially at the two Senators from Maine, not two hours drive from Vermont.

 
Comment by Arizona Slim
2010-11-22 10:46:38

Do you have links, Slim? I’d be interested to see how this is different from the insurance mandate currently in Massachusettes. If Single Payer works in Vermont, maybe Congress* will use it as a model and justification for at least a Public Option nationally. Especially when the private insurers squeeze even more blood out of the sick.

Here’s the link to Vermont for Single Payer.

And here’s a recent interview with Sen. Sanders on single payer.

 
Comment by nickpapageorgio
2010-11-22 11:36:44

“Just goes to show we need a universal single payer health care system.”

Who exactly is the single payer and who is really paying?

 
Comment by REhobbyist
2010-11-22 18:02:03

Nick, it would basically be Medicare for all.

 
Comment by oxide
2010-11-22 19:49:38

DOn’t let Nick’s innocence fool you. It’s his intro to “I’m not paying for health care for those lazy unwashed bums.”

 
Comment by nickpapageorgio
2010-11-22 23:04:02

I already pay higher premiums to cover lazy people. I am not worried about paying for the unwashed as you say, I am worried about the control…How’s the TSA working out these days? How about we put the big brains behind grope gate in charge of health care?

“Bend over and take it like a man” will replace “open up and say ahh”

 
 
Comment by edgewaterjohn
2010-11-22 07:52:06

Well IF (big if) that’s the case then our colleges and universities should be ghost towns. Why are all these people busting their humps and taking on all that debt?

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Comment by Blue Skye
2010-11-22 07:55:09

On the chance that they will make $120,000 or marry the one that will.

 
Comment by Arizona Slim
2010-11-22 08:00:56

Well IF (big if) that’s the case then our colleges and universities should be ghost towns. Why are all these people busting their humps and taking on all that debt?

I just finished reading Craig Brandon’s very good book, The Five-Year Party: How colleges have given up on educating your child and what you can do about it. In it, he talks about the crippling effects of student loan debt — how it’s affecting career choices, marriage and childbearing plans, and our favorite topic, home purchases.

In short, student loan debt is a real millstone.

 
Comment by Kirisdad
2010-11-22 08:02:01

Higher education- the next debt bubble to pop.

 
Comment by edgewaterjohn
2010-11-22 08:17:05

When taking on debt becomes an absolute requisite to obtain something (IMHO almost anything) the need to obtain it should absolutely be questioned.

For the individual that might mean proceeding and it might not. Clearly, not a whole lot of people are into questioning things anymore. Healthy skepticism is out.

 
Comment by oxide
2010-11-22 08:42:29

It’s easy to decry a college education, but I can tell you that you REALLY need college for some jobs, especially sci-eng. I believe differently about liberal arts.

Quick anecdote: Two weeks ago I was walking past the entrance to the local community college at 5:45 pm. There were so many cars making rights and lefts onto the road that it was blocking up traffic, badly. There were almost no parking spaces. It’s not unique; I encountered the same thing two years ago in Ohio when I took a non-credit Spanish class.

People are getting wise to the college scam. Colleges just aren’t teaching the same skillz that are in the job listings. Much of that debt is for the dorm life anyway. They are living at home and taking cheap night classes.

 
Comment by In Colorado
2010-11-22 09:39:05

” Much of that debt is for the dorm life anyway.”

Oh yes, most schools charge 8-10K to live on campus.

 
Comment by Steve J
2010-11-22 10:03:11

” They are living at home and taking cheap night classes.”

When were night classes cheaper? They are more expensive (per class) due to all the student fees you have to pay(I’D, parking,student union,activities,blahblahblah) and there is no break on books.

 
Comment by In Colorado
2010-11-22 10:49:55

By “cheap night classes” it was probably meant classes at the the local CC, which in places like California are very cheap.

 
Comment by oxide
2010-11-22 11:37:19

SteveJ, community colleges are the cheapest credit hours out there. Parking isn’t all that much. When I took the Spanish class, the parking pass was included in the course fee. Also, people are taking 1-2 classes at a time which spreads the costs.

We’re going back the model of the 1950’s and 1960’s, where kids stayed at home and worked their way through college while holding a day job bagging groceries. Not a bad way to go for the generic college degree. For sci-eng, it’s all about scholarships.

 
Comment by RioAmericanInBrasil
2010-11-22 12:00:45

People are getting wise to the college scam.

The hard way….

A generation in free fall | Recession shatters many young career dreams

http://www.kansascity.com/2010/11/20/2456350/a-generation-in-free-fall-recession.html#ixzz162UELxlQ

Our wounded economy has twentysomethings limping into the job market. Large numbers are out of work.

They hoped for more and got less.

“I pictured myself in a suit and tie, working in an office, making a decent salary,” said Adam Barry, 23, who graduated from Baker University last year with a business degree.

Instead, he wears an orange polo shirt to work every day, selling paint to do-it-yourselfers while pondering how he’ll overcome $37,000 in college loan debt.

It’s a generation stalled, exiled from an economy hung over from a crash set off by house-flippers, mortgage scammers and Wall Street shell games.

“You keep trying. You keep your head up,” said Paul Aubrey, who at 29 lives awkwardly with his parents in Gladstone while settling temporarily for a bank teller’s job. “But it gets awfully discouraging.”

Even among the college-educated, prospects have soured. In 2000, 4.3 percent of those with bachelor’s degrees of all ages were unemployed. Today it has nearly doubled to 8.5 percent. College surveys found that in 2004, more than 76 percent of grads were working within six months after leaving campus. By 2008, the most recent year measured nationally, that had fallen to 68 percent.

Evidence suggests that the battered economy will stunt the careers of today’s young. Many are settling for lower salaries, which will beget smaller wages for the rest of their working lives

It will set back their psychological maturity, delaying when they marry or have children or buy homes. Their unborn children’s college educations could already be in doubt.

Large numbers will default on student loans or end up owing great amounts to trade schools without finding a place to drive a screw or wire a fuse. Or they’ll borrow themselves deeper into debt, gambling that times will eventually get better.

The young’s problems are everyone’s trouble. The joblessness means fewer people propping up Social Security, Medicare and other generational transfers of money.

 
Comment by In Colorado
2010-11-22 12:02:02

“We’re going back the model of the 1950’s and 1960’s, where kids stayed at home and worked their way through college while holding a day job bagging groceries.”

That’s basically what my daughter is doing.

But a lot of kids aren’t, at least not yet. You should see the new “residence halls” that were built recently at her school. Taj Mahals all of them.

 
Comment by edgewaterjohn
2010-11-22 12:37:32

“Many are settling for lower salaries, which will beget smaller wages for the rest of their working lives,”

Yup, and so much for the V-shaped return to boom-era house prices. Sure, money can be made but future specuvestors ought to consider the earning power of future buyers.

 
Comment by The_Overdog
2010-11-22 12:47:57

You keep trying. You keep your head up,” said Paul Aubrey, who at 29 lives awkwardly with his parents in Gladstone while settling temporarily for a bank teller’s job. “But it gets awfully discouraging.”

——————————–
This has to be the best sentence I’ve read in a week. This writer loves adverbs!
Just imagining living ‘awkwardly’ with the parents. Son, stop doing that in the living room!!!!

 
Comment by Arizona Slim
2010-11-22 12:51:48

Instead, he wears an orange polo shirt to work every day, selling paint to do-it-yourselfers while pondering how he’ll overcome $37,000 in college loan debt.

I’ll admit to having similar jobs when I was in my twenties. And, after all the lofty “Just think of where a degree from this place will take you!” smoke that was blown my way at the University of Michigan, those jobs were a real letdown.

However, what I didn’t have was student loan debt. It was very uncommon to have it back when I graduated.

And I can’t help thinking that, before long, such debt will be about as fashionable as “housing as an investment” is currently becoming.

 
Comment by ecofeco
2010-11-22 16:24:15

“Many are settling for lower salaries, which will beget smaller wages for the rest of their working lives,”

Welcome to the real world. Really, you’ll feel a lot better after the smoke clears from your posterior and you see just what a chump you were.

Valuable real lesson, right?

 
 
Comment by Spokaneman
2010-11-22 12:58:37

I would like to see the calculaton. It may be true, but I would like to see how the numbers work.

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Comment by Spokaneman
2010-11-22 13:05:38

Sorry, this response was in regard to the 60K family having less disposable income than a Min wage worker. Got posted in the wrong place.

 
 
Comment by fisher
2010-11-22 17:51:55

Well, colbalt & banana, I’d really like to see the citation on this or at least a rough workout of your logic. In 2006 I had a job that paid $8.50/hr. That was a dollar higher per hour than minimum wage in NM. Disposable income, somewhere between zero and maybe a hundred bucks a month… and I owned my home free and clear at the time. A year later I had a job paying 60K per year, coincidently the same figure you used. My disposable income, whilst paying about 700 bucks a month rent was still over 2000 bucks a month. Now you explain *that* to me using your little anecdote. Nothing else changed. Same car, same basic expenses. Property taxes were not an issue being somewhere around 500 bucks a year. I do not have crotch crtitters to deduct or instruct so maybe that’s what the real deals is. Please enlighten me because I am calling major bullshit on your claim based on direct experience.

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Comment by jeff saturday
2010-11-22 07:27:54

We spent over $150.00 at the grocery store yesterday, the people in front of us who did not speak English paid $32.00 and got more than we did. They had one of those magic food stamp cards. Of course that is legal.

Do I have to be a United States citizen to get help?
You have to be a U.S. citizen or a non-citizen who meets certain criteria to be eligible for food stamps. Click here for more information
Parents who aren’t citizens may apply for benefits for their children who are U.S. citizens. Receiving food stamps won’t affect your ability to become a U.S. citizen.

Comment by 2banana
2010-11-22 08:25:08

I worked as a check-out person in a grocery store for a while.

Amazing the foods that people buy on food stamps. Steak, shrimp, processed foods (frozen pizza, TV dinners), etc.

No one is buying flour to make their own cheap bread. Or peanut butter. Or rice. Or ground chuck. etc. Most had nice cell phones, smoked and nice bling.

Never use coupons.

And they used to get mad at me when told certain items that actually had to pay cash for…

This was also my first job in which I first found out about unions and the “closed shop” laws in which they forced me to join and pay their union dues (after taxes, union dues took about 1.5 hours/day of pay from me).

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Comment by Steve J
2010-11-22 08:29:45

A lot of companies benefit from food stamps.

How would the poor afford their cigarettes otherwise?

 
Comment by polly
2010-11-22 08:49:59

Not all states use the same system. When my uncle’s kids were still in the foster care system, they got benefits (I think it was through WIC, not SNAP, but you are still dealing with a large group of people receiving food benefits). They put out a styrofoam container on their scheduled delivery day. During the day, food/supplies were delivered to the container including milk, eggs, cheese, peanut butter, cereal, diapers, etc. Now, you couldn’t make a system like that work in a seriously urban environment, and Vermont winters are especially friendly for fresh food deliveries, but that state made its decision about how to control what is purchased on the program.

Other states make other choices.

 
Comment by Prime_Is_Contained
2010-11-22 09:16:07

“but that state made its decision about how to control what is purchased on the program.”

Wow, that’s awesome! I didn’t know that any states did it that way.

Imagine that, food assistance you can feel good about, because you know it actually is providing nutritious food instead of junk food.

Brilliant.

 
Comment by polly
2010-11-22 11:21:43

It worked in a low population state. A lot of people on the program were in very rural areas where there was no issue leaving a bunch of food in an unsecured container near the front steps. Also, now that I think about it, they might have gotten their milk just by being added to the local dairy delivery route. Some of the other food was local too like big blocks of Cabot Cheddar.

 
Comment by RioAmericanInBrasil
2010-11-22 11:53:01

Amazing the foods that people buy on food stamps…steak…shrimp….

…they forced me to join and pay their union dues (after taxes, union dues took about 1.5 hours/day of pay from me).

Maybe you paid the union dues so you wouldn’t end up on food stamps like the people buying steak and shrimp.

 
Comment by pressboardbox
2010-11-22 13:08:03

If they pulled the food-stamp program, Walmart and Target would fold within a month. Every convienence store would close overnight. The banksters would all need new underwear and there would be a run on the fruit-of-the-loom bin near Wall Street. It would be worth it just for that.

 
 
Comment by scdave
2010-11-22 09:25:28

who meets certain criteria to be eligible for food stamps ??

I believe I read somewhere recently that there are 50-mil + people in our country on food stamps…

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Comment by GrizzlyBear
2010-11-22 11:22:22

I read it’s close to 50 million. If this program were not available, you’d see the country go nuts very quickly. Still, I do not agree with allowing people to jump the fence into the country and receive free food and health care. We simply cannot afford it.

 
Comment by Spokaneman
2010-11-22 13:00:40

There are lots of military families on food stamps.

 
Comment by Rancher
2010-11-22 17:12:34

Actual number is 40 million.

 
 
Comment by Diogenes (Tampa, Fl)
2010-11-22 10:11:19

This has been going on for a long, long time. It’s good you are finally starting to notice. You may also note that most of them are usually over-weight, and alway buy the best name brands. They will not buy “store brands” which you are I will buy because the cost less. They buy whatever is best.
Then, they will go out into the parking lot and drive away in their Escalade, with the “music” blaring.
Most of you probably haven’t noticed this because you need to shop after you are done with your job.
They can shop anytime of day, and have all day to do it.
Wake up, America. You are working your lives away to support a parasite class that never works.

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Comment by mikey
2010-11-22 11:15:00

Fear not, fear not !

Palin, Bohnier and the GOP congresscritters are quickly off loading the piles of unemployment CC’s and big bundles of cash as we speak and re-loading Ben’s famous choppers with 1943 issue date C-Rats(minus the cigs) and LURP rations for the unwashed poor as we speak in electronic little 0’s and 1’s.

Some of the more fortunate with kiddies may even get a ration of a 1/8 lb mooseburger and a little clean RNC Holy water if we can find enough H2O cans for Thanksgiving Day for the airdrops.

They promised this, they promised this, honest just wait and see…you might even get some too !!

It’s hard, sweaty work for the congresscritters but your mod-term votes all counted, they are most greatful and are frantically reloading the benefits, bailout and welfare choppers as you demanded right now…just wait, watch and see.

The Great Austerity …is a’comin…they promised!

:)

 
Comment by AvOcadO
2010-11-22 11:47:31

Everyone needs their own Bohnier!!!!

 
Comment by In Colorado
2010-11-22 12:08:48

I don’t see any Escalades where I live. I do know a few folks on welfare, and they drive beaters. Not saying that there aren’t cheats who do have incomes (peddling drugs?).

I ocassionally see people pay for their groceries with the welfare debit cards. Their baskets aren’t full of steaks and lobster.

It’s probably a cultural thing. I’m sure you are seeing this in Florida, but I’m not seeing it out here where I live.

There was an article in the local paper about the waiting list for section 8 housing out here, and how people camped out in the cold (and it gets cold here) when it was announced that a few more “seats” had been opened.

 
Comment by edgewaterjohn
2010-11-22 12:42:46

My grocery store sees heavy food stamp usage. From what I see each and every week there are hardly any proteins (let alone steak & lobster) in the food stamp shoppers carts. They seem to prefer refined sugars/starches. Puffed corn products are especially common.

 
Comment by Rancher
2010-11-22 17:17:54

What I see is a 275 lb women in white spandex, cellulite rippling up and down her legs, pushing a shopping cart full of diet
Coke, ten packages of frozen pizza, and half
a case of cheeze and Macaroni, all the while
dragging two dirty, filty kids that haven’t seen
a bath in six months, and they paying with her
Oregon Trail Card (food stamps).

 
 
 
Comment by theoracleofnebraska
2010-11-22 07:44:24

Wow.

Make sense to perpetuate the welfare lifestyles. The best you could do if you are on welfare is to move up to Middle class. If you are going to have less money by moving up the ladder, what’s the point?

Good ol’ USA. F*** the middle class but enrich the banksters, ceos, government employees and unions.

 
Comment by MightyMike
2010-11-22 08:08:10

In Entitlement America, The Head Of A Household Of Four Making Minimum Wage Has More Disposable Income Than A Family Making $60,000 A Year

Is this a headline from a news article? It doesn’t appear to be make sense. Is there some very unusual definition used for disposable income?

Comment by Professor Bear
2010-11-22 08:20:26

“Is there some very unusual definition used for disposable income?”

I propose, ‘The extra money you have available for current expenditures between the time when you stop paying your mortgage and when you are foreclosed.’

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Comment by DF
2010-11-22 09:06:52

Some of the accounting is kinda weird on these calculations –

They add in in $16.5k/yr for Medicaid and SCHIP as credits toward disposable income.

Also, Section 8 is really hard to get in a lot of places, so I don’t know if you should really count the $4k-$4.5k/yr there either.

Overall, I think that the calculation is really “optimistic” in terms of what you would actually be able to get as a welfare recipient.

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Comment by Prime_Is_Contained
2010-11-22 09:27:07

“Also, Section 8 is really hard to get in a lot of places, so I don’t know if you should really count the $4k-$4.5k/yr there either.”

Or maybe you should count more than that. It would be interesting to see stats on the distribution.

Anecdotally, a friend of mine is a LL. He recently decided to accept Sect 8 on one of his rentals, and lined up a tenant. She is a single mother with a couple of kids. But she lives in a more expensive rental than I do; he gets roughly $1700/mo for it, and her contribution to that rent is on the order of $200-some dollars per month.

Made me go “hmmm”.

 
Comment by cactus
2010-11-22 09:29:47

Also, Section 8 is really hard to get in a lot of places, so I don’t know if you should really count the $4k-$4.5k/yr there either.”

I think you have to know and bribe somebody to get Section 8 in CA.

Just like in Mexico

 
Comment by Steve J
2010-11-22 10:06:08

Section 8 has no waiting lists in Texas for houses.

 
Comment by jeff saturday
2010-11-22 14:15:42

““Also, Section 8 is really hard to get in a lot of places,”

What I know of it in SE Florida, it`s hard to get into because the people that are in never get out.

 
Comment by ecofeco
2010-11-22 16:17:24

“Section 8 has no waiting lists in Texas for houses.”

Wanna bet?

First, there IS a waiting list. Second, there is also a very high rejection process.

 
 
Comment by oxide
2010-11-22 09:34:32

I really do need a link for this, especially the authors of the study. Seriously, it sounds like Heritage Foundation stuff aimed at reducing government and starving the poor. Because, you know, the rich Already Got Theirs.

That said, I’ll repeat my support of a Government Store for food stamps. Heck, maybe even offer Dollar Store type things like soap and socks too. “Humiliation” and lack of choice? You betcha. Beggars can’t be choosers.

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Comment by ecofeco
2010-11-22 16:08:06

“In Entitlement America, The Head Of A Household Of Four Making Minimum Wage Has More Disposable Income Than A Family Making $60,000 A Year”

I saw this tripe yesterday. What bullcrap. Obviously written by someone who’s never actually actually had to live on min. wage.

And if the family making 60K can’t get by on that income, then why do they deserve it?

Fat bank on min wage?! HAHAHAHAHAHAHAHAHAHAHAHA

Dear god. People WILL believe anything!

Comment by Arizona Slim
2010-11-22 16:13:49

Obviously written by someone who’s never actually actually had to live on min. wage.

I have lived on minimum wage. Only being able to afford two meals a day was really fun.

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Comment by pismoclam
2010-11-22 16:44:11

Is that how you got Slim?

 
 
 
Comment by pismoclam
2010-11-22 16:33:41

Let’s see, Schumer wants to have tax rates lowered for everyone making less than $1 million. Sounds good to me. I make less than $1 million.Wonder when they will blink and sign on to an extension of the unemployment benefits? X’Mas is coming and Mrs. Pismo wants some presents.

Comment by exeter
2010-11-22 17:39:31

“I make less than $1 million.”

Its quite evident to us that you’re a low wage earner. And always will be.

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Comment by Sammy Schadenfreude
2010-11-22 07:03:22

http://www.radionz.co.nz/news/business/62362/credit-downgrade-warning-for-new-zealand

Crisis contained, people. Nothing to see. All is well, despite the appearance the contagion is spreading like an epidemic. The global financial system is fundamentally sound. Bernanke and Timmay said so. If something were amiss, the ever-diligent MSM would have told us about it.

Comment by DennisN
2010-11-22 09:25:23

You forgot to mention the efforts of the crusading investigative reporters.

 
 
Comment by Professor Bear
2010-11-22 07:18:01

Here is my holiday financial crisis reading list:

1. All the Devils Are Here by Bethany McLean and Joe Nocera

2. Griftopia by Matt Taibbi

3. The Monster: How a Gang of Predatory Lenders and Wall Street Bankers Fleeced America–and Spawned a Global Crisis [Hardcover]
Michael W. Hudson

4. All Real Estate Is Local: What You Need to Know to Profit in Real Estate - in a Buyer’s and a Seller’s Market [Hardcover]
by David Lereah

5. Cashing in on Pre-foreclosures and Short Sales: A Real Estate Investor’s Guide to Making a Fortune Even in a Down Market [Paperback]
by Chip Cummings

Please feel free to supplement my list with any suggestions you can add, as I plan to do lots of reading during my ursine winter hibernation, and I would like to get my Amazon dot com order in before the holiday rush!

Comment by arizonadude
2010-11-22 08:21:23

Thx for the great ideas.

Never forget george bush:

“Wall street got drunk.”

Comment by theoracleofnebraska
2010-11-22 11:26:28

Bush provided the alcohol.

Comment by Professor Bear
2010-11-22 20:42:56

Obama, Geithner and Bernanke are providing the hair-of-the-dog hangover cure.

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Comment by scdave
2010-11-22 09:44:20

#1 I suppose will be a best seller…Whats kind of interesting though is I have heard a lot of talk about what in the book including listening to the authors on a number of occasions…We have been discussing all the relevant facts in the book on this blog for years…Ben could have wrote this book I suspect…

#4 could be interesting although the name of the book and its suggestion that “All real estate is local” is not a revelation…Location, location, location, has always been the name of the game in real estate although from 2002-2007 it morphed into something that made it appear it didn’t matter….This is why (as we have discussed) that I believe the 2nd & 3rd tier real estate markets are going to continue to get pummeled…

 
Comment by RioAmericanInBrasil
2010-11-22 12:47:27

Please feel free to supplement my list with any suggestions you can add

Patriotic Treason, John Brown and the Soul of America, Evan Carton, 2006, Free Press

Why? Because it will provide American historical and moral perspective to the implications of your reading list’s subject matter.

http://www.amazon.com/Patriotic-Treason-John-Brown-America/dp/074327136X

 
Comment by Jim A.
2010-11-22 13:11:44

Well I enjoyed The Big Short by Michael Lewis.

Comment by Arizona Slim
2010-11-22 13:16:38

Of all the recent economic collapse books, The Big Short is the one I’ve enjoyed the most.

 
Comment by sleepless_near_seattle
2010-11-22 14:39:34

That’s a good one. My ADHD (self, not clinically, diagnosed) normally doesn’t let me get past Chapter 1 in most books. This one held my attention throughout. I got edgy when I had to put it down at 3AM and get some sleep…

 
Comment by Professor Bear
2010-11-22 20:44:17

I’ve been avoiding that one, due to my perception that Lewis is a closet apologist for Wall Street criminals, but perhaps I will have to give in and read it if it provides (intellectual) stimulus…

 
 
Comment by sleepless_near_seattle
2010-11-22 14:46:50

Don’t forget the gold bug in you, Schiff’s got a new one out as well! Just got it from the library. Although, I growing weary of how often he works it into his interviews and commentary on his radio show…

How an Economy Grows and Why it Crashes. $13.57 at amazon

 
Comment by ecofeco
2010-11-22 16:32:40

Gangs of America - Ted Nace

Excellent history on the rise of organized capital and the evolution of guilds to corporations and how corporations are the real government of this country.

Comment by ecofeco
2010-11-22 16:34:59

Oh. Did I forget to mention it’s free? On line? And can be saved to your PC? Can’t beat that deal.

http://www.gangsofamerica.com/gangsofamerica.pdf

(skip the last chapter. it’s too slanted even for me. Everything up to that is eye opening priceless history)

 
 
 
Comment by exeter
2010-11-22 07:20:22

“Housing’s ‘shadow inventory’ rose in August”

http://www.marketwatch.com/story/housings-shadow-inventory-rose-in-august-2010-11-22

Shadow inventory up another 10% according to the article….. BHWHAHAHAHAHAHAHA

 
Comment by Spook
2010-11-22 07:22:31

Chandra Levy jury is still out on whether to convict the illegal immigrant in her murder.

What do you guys think?

Is he the “pigeon?”

the charges against him are based on a jail house snitch.

Personally, I’m skeptical because no one has really accounted for Levy’s internet/computer activity prior to her disappearance?

this may end up like the Leo Frank case where they keep bring in various “buffoons” to take the fall; but they’re not smart enough to pull it off…

Comment by arizonadude
2010-11-22 07:29:49

I wonder how much this illegal is being payed by condit to take the fall?

Comment by cobaltblue
2010-11-22 07:36:56

He probably won’t collect all that was promised, or get to spend the “downpayment”. Accidents will happen, as they say.

Comment by Steve J
2010-11-22 12:34:59

I’m sure his family already has a new house.

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Comment by REhobbyist
2010-11-22 18:22:29

I’m sure you guys are joking. Condit lost his congressional seat, perks and power. He did make some money suing tabloids, though. And his experience obviously hasn’t deterred politicians like Spitzer, Ensign, Sanford, Vitter, etc.

 
 
 
 
Comment by exeter
2010-11-22 07:36:09

The National Enquirer is right this way—–> http://www.nationalenquirer.com

C-ya

Comment by cobaltblue
2010-11-22 09:05:39

I was reflecting yesterday about your comment that “Raising the minimum wage does not mean there will be fewer jobs. Time to put that to rest.”

http://tinyurl.com/27tn85j

Buona fortuna e auguri

Comment by exeter
2010-11-22 10:13:10

If you could refute it, you would have.

At least you’re honest in that you cannot.

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Comment by ecofeco
2010-11-22 16:40:30

Studies have shown again and again how raising the min wage creates more disposable income for circulation in our….

What type of economy do we have again?

C-o-n-s-u-m-e-r

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Comment by Spook
2010-11-22 11:13:16

Gary CONNED-it

says: “YES!!!!!!!!!!”

high 5s, fist bumps…

Whew!

that was close!

Comment by Spook
2010-11-22 12:33:58

BTW, why wasn’t this Illegal immigrant sent home the first or second time he was convicted of a violent assault?

Was he being kept here until he finally got it right and sucessfully murdered a woman?

WTF?

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Comment by exeter
2010-11-22 16:14:48

—–> http://www.nationalenquirer.com

buh bye EddieTard.

 
 
 
 
Comment by ecofeco
2010-11-22 16:46:07

It took me a while to remember this story.

It was obvious who did it when the story first broke and it wasn’t the immigrant.

This is the giveaway right here : “…no definitive ruling from the medical examiner on what killed Levy.”

Hello?

 
 
Comment by Professor Bear
2010-11-22 07:27:33

Is it too soon at this point to give up on Eddie’s year-end rally to DJIA = 12K?

Index Futures:
S&P 500 1,193 -5.00 -0.42%
DOW 11,143 -36.00 -0.32%
NASDAQ 2,132 -1.50 -0.07%

Stock futures broadly lower
IRELAND IN CRISIS

Indications

Nov. 22, 2010, 9:19 a.m. EST
Stock futures fall on euro-zone debt worries
Earnings from tech giant Hewlett-Packard due later in the day
Previous Column: U.S. futures down as China ups reserve ratio
By Polya Lesova and Nick Godt, MarketWatch

NEW YORK (MarketWatch) — U.S. stock futures dropped Monday, as doubts surfaced about whether an international bailout for Ireland will be enough to restore financial stability in the euro zone.

Futures on the Dow Jones Industrial Average (DJZ10 11,143, -36.00, -0.32%) fell 37 points to 11,142.

Comment by Professor Bear
2010-11-22 08:39:16

Today is a severe test of the Plunge Protection Team’s ability to prop up the DJIA against a drubbing. DJIA = 11K or bust!

Comment by GrizzlyBear
2010-11-22 12:28:48

The PPT is doing a masterful job as I type. The DOW is only down 69 right now, rallying over 70 points in the blink of an eye.

Comment by pressboardbox
2010-11-22 12:57:12

The PPT is the root of all evil. TBTF at its best.

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Comment by GrizzlyBear
2010-11-22 14:04:45

Stocks finished on the highs of the day. DOW only down ~25 points.

 
 
Comment by Professor Bear
2010-11-22 08:51:36

Yawn…

Banks lead to steeper slide

Weakness in some of the biggest U.S. banks weigh on the market, as U.S. stocks fall to their lowest point of the session at midmorning.

Comment by arizonadude
2010-11-22 10:18:23

I buy stocks cause cramer said the economy is recovering.I’m going to dollar store for more tinfoil today too.

 
 
 
Comment by Professor Bear
2010-11-22 07:40:16

Anything that goes wrong with QE2 from here on out is due to criticism, not due to a failed plan.

Let me be the first to point out what a bunch of psychobabble economics hogwash this is.

* MARKETS
* NOVEMBER 22, 2010

Criticism Hinders Fed’s Easing Plan
Doubts about the central bank’s ability to expand its bond-buying program have driven Treasury yields higher
By SUDEEP REDDY

Criticism of the Federal Reserve’s latest bond-buying program, both from insiders and from U.S. politicians, is muting the plan’s potential benefits for the economy.

Amid widely publicized skepticism about the efficacy and wisdom of the bond buying, investors and traders are questioning whether the Fed would be able to expand its bond purchases beyond $600 billion—even if inflation continues falling and unemployment remains high. Those doubts have contributed to an increase in yields on U.S. Treasury bonds since the Fed announced the program on Nov. 3, they say.

The criticism “has raised questions about the Fed’s ability and resolve to control the yield curve,” said Mohamed El-Erian, chief executive and co-chief investment officer of Pimco, the bond-fund giant. “The criticism has unsettled markets naturally inclined to worry about the politicization of the Fed and its loss of autonomy,” he said.

Comment by Professor Bear
2010-11-22 08:57:47

Is it possible that the Fed’s suggestion that they can save the world from the consequences of the Fall 2008 financial collapse by adjusting the speed at which they run their virtual fiat money printing press is fundamentally specious?

* ECONOMY
* NOVEMBER 22, 2010

Japan’s Tale of Caution On Fed Monetary Policy
By YUKA HAYASHI

TOKYO—The Federal Reserve has moved to pump up the U.S. economy with an unconventional program to buy government bonds known as “quantitative easing,” or QE. But the experiences of the QE pioneer—the Bank of Japan—show how difficult it is to make this approach work.

Nearly a decade after Japan’s central bank first experimented with the policy, the country remains mired in deflation, a general decline in wages and prices that has crippled its economy.

And just as politicians in the U.S. are criticizing the Fed for veering beyond traditional monetary policy and are threatening to curtail the bank’s independence as a result, lawmakers in Japan say they’ll do the same to the BOJ as punishment for its failure to cure the scourge of falling prices.

Japan’s experience offers a case study in the possibilities and limits of quantitative easing, in which a central bank effectively prints money to spur economic activity.

The BOJ began doing quantitative easing in 2001. It had become clear that pushing interest rates down near zero for an extended period had failed to get the economy moving. After five years of gradually expanding its bond purchases, the bank dropped the effort in 2006.

At first, it appeared the program had succeeded in stabilizing the economy and halting the slide in prices. But deflation returned with a vengeance over the past two years, putting the Bank of Japan back on the spot.

So why didn’t quantitative easing work in Japan? Critics say the Japanese central bank wasn’t aggressive enough in launching and expanding its bond-buying program—then dropped it too soon. In 2006, prices had just started rising, a sign that quantitative easing was beginning to work. But some indicators were already signaling a slowdown in the economy.

Others say Japan simply waited too long to resort to the policy. Tomoya Masanao, who oversees the Japanese portfolio for bond fund giant PIMCO, points out it took the BOJ two years after Japan’s consumer prices started falling to launch its bond-buying program. What’s important is to do it quickly and aggressively before inflation expectations start to diminish,” Mr. Masanao says. “It’s very clear other central banks have learned this lesson well” from what happened in Japan.

 
Comment by measton
2010-11-22 09:42:43

If we all just believe in candy crapping unicorns everything will be OK??

Comment by ecofeco
2010-11-22 16:53:29

It worked for Wall St. didn’t it?

 
 
 
Comment by Overtaxed
2010-11-22 07:42:30

Oh boy.. Here we go.. Black Friday time. Wonder how many idiots are going to get killed this year trying to buy a flatscreen or a laptop?

I hate this time of year. I’m perpetually gloomy from now until New Year’s Eve (so forgive me if my posts sounds a bit “doom and gloom”).. This is the yearly height of the “American Consumer” season; and, frankly, it makes me sick.

I love buying stuff and having nice things. But not for the next month; I’m trying to avoid any store that has anything resembling a BF/crazy holiday sale.

Thank God for Amazon!

Comment by arizonadude
2010-11-22 07:53:44

walmart will be packed I’m sure.The throw away society never ceases to amaze me.

Comment by m2p
2010-11-22 08:06:25

I stopped at our local not so super Walmart for pet food yesterday.They already had the maze of metal fences out front. I couldn’t figure out what they were for until one helpful gent mouthed Black Friday.

Comment by arizonadude
2010-11-22 08:23:25

Did you see any full sets of teeth?

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Comment by m2p
2010-11-22 09:25:08

Only on the pets in the cars.

 
Comment by scdave
2010-11-22 16:15:24

LOL…

 
 
Comment by GrizzlyBear
2010-11-22 12:40:59

Your poor pet. Please start feeding them better.

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Comment by m2p
2010-11-22 14:35:35

Hey it was cat food, treats actually, the cat is not too picky. OTOH my GSD eats better than most people. Special food for his “special” skin condition, but worth every penny for my best buddy.

 
 
Comment by pressboardbox
2010-11-22 13:00:54

Getting the “cattle-herders” out. Whenever I line up anywhere in those things I let out a loud and ornery “Mooooo!!!!”. Some laugh, most look at me with a “don’t upset the farmer” look.

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Comment by awaiting wipeout
2010-11-22 16:08:23

I buy toiletries and other misc. essentials at Wal-Mart, since they have the best price. I am a huge fan of their seasonal dept.I’m a size 2, in my 50’s, so not all WM customers are slops. (I am well groomed and dressed, and I somewhat stand out, I’ll admit.)

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Comment by edgewaterjohn
2010-11-22 07:58:17

No need to be gloomy, just identify the source of your angst and stay away from it. Traveling helps a lot, especially to places that don’t give a R.A. about these holidays. Last year my destination was Japan - perfect escape from the holidays. They have some cutesy decorations here and there but otherwise it’s business as usual - until the big New Year’s celebration (Japan celebrates New Years when we do) - but that too wasn’t at all obnoxious.

Comment by In Montana
2010-11-22 14:24:34

‘especially to places that don’t give a R.A. about these holidays. ‘

Nevada was really cool about the holidays. They welcomed the crowds of course but otherwise there was no evidence, except maybe a Christmas tree in the hotel lobby. Everything open, entertainment booked straight through with no break.

No idea how it is now.

 
Comment by pismoclam
2010-11-22 17:08:25

I wonder if you would be arrested and fined $11k if you put a mouse trap down your clothes and opted for a pat search from the TSA ?

 
Comment by awaiting wipeout
2010-11-22 20:41:59

I have a lot of respect for the Japanese culture. Smart, industrious, well mannered, and they seem like decent folks for the most part. I would love to visit Japan.

Moral, but not to a fault. Aren’t they known as copiers, as in reverse engineering?

 
 
Comment by polly
2010-11-22 08:10:24

I finished my holiday shopping last week. Still need to wait for arrival of three items, wrap and mail them, but other than that, I am finished. I wonder if it might be fun to go to a few malls with absolutely no need to buy anything, but just people watch? I expect the music would drive me nuts if I didn’t end up just leaving without going inside because of the parking.

I actually need to buy a computer this year - not looking forward to the process as much as I should, but the current machine is nearly 8 years old and just doesn’t hack it. Anyone have an iMac? Is is as much fun as it looks?

Comment by denquiry
2010-11-22 08:21:12

I bought an Imac in 8/09 after my dell died on me. It has a better video board and I will never go back to a PC. I use my Imac for surfing the web, email, and as a typewriter. And so far no problem with viruses and spam. I have no regrets about buying an Imac.

Comment by polly
2010-11-22 09:05:48

What is the diag on your screen?

I’m looking for a machine that will be OK for watching netflix, etc. while on the exercise bike or even from the sofa. My current furniture set up will allow that if I can swing the screen around and with the integrated machine, swinging it around should be fairly easy. I’m not ready to take the final plunge on getting a TV set up that will connect to the net. Not an early adopter for tech and I like to keep the stuff until just before it drops, obviously. I will definitely be getting a stand alone hard drive for back ups. Currently just living on a prayer. Very dangerous.

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Comment by ann gogh
2010-11-22 09:18:40

Polly, mac air!

 
Comment by polly
2010-11-22 09:54:51

Isn’t that a laptop? I don’t want a laptop. I don’t need to bring my general computing power with me everywhere. My brother is a professor - I get why he needs his whole computing life with him all the time in case he needs to do grading or figures out the one idea that will make his next published paper the best thing since sliced bread. My work cannot even be done in a public place never mind put on a personal machine.

I want a very large screen and streaming capabilities and to be able to finally use the tape digitizer that I got from Think Geek to put all the radio interviews I researched into MP3 format. I expect that I will end up with an ipad in the distant future, but not for quite a while.

The thing that is making me hesitate is that I am worried I am giving in to “pretty.” It is just so much more attractive than another regular desktop set up with a billion wires draped down my desk. And it looks like it would cost about $500 more. For a machine I hope to have for a long while, that migh be just fine. I just have to talk myself into it.

 
Comment by Steve J
2010-11-22 10:08:39

The iPad streams Netflix and it looks great.

 
Comment by oxide
2010-11-22 11:48:02

Polly, what you’re describing doesn’t sound like the standard-issue laptops these days. It sounds like you need to build something custom. For example, you could hook up a gamer tower to a large-screen TV that doubles as a computer monitor. The “gamer” doesn’t mean it’s a bad computer, it just means it has a super-fast processor. Perhaps you should go to MicroCenter or the Apple Store and tell then what you told us. They can help you out.

 
Comment by polly
2010-11-22 12:43:46

Yeah, and that is exactly why I am not looking forward to the process. There is an Apple Store in Bethesda and a Microcenter in Rockville. I currently have a tower and a 15 inch CRT monitor that I bought in an all included box at BJ’s Wholesale Club. Hmm…just got an offer for two months free membership there too. Sigh. I don’t like shopping and I don’t like fighting traffic on the Beltway. Walking into a Best Buy puts me on the edge of an hysterical scream (something about the acoustics, I think). Oh well. When you are as deep into windows rot as I am, you can’t do much about it.

And as I said, I have no interest in a laptop. I live in a one bedroom apartment and my office is in the living room. As long as I can live without the internet while actually in bed, I don’t need a laptop. I can wait through a few more generations of iPads for that. But the 27 inch iMac looks kind of nice.

 
Comment by RioAmericanInBrasil
2010-11-22 13:02:44

And it looks like it would cost about $500 more. For a machine I hope to have for a long while, that might be just fine. I just have to talk myself into it.

Get the iMac. The big one. It’s cheaper in the long run most times. No down time because of viruses, bugs, spyware etc. Less service fees due to those. The OS is great.

And hey, it’s really pretty.

IMac is in mid-product cycle and might have an upgrade in about 3 months.

http://buyersguide.macrumors.com/

I type this on a rockin’ MacBook Pro.

 
Comment by polly
2010-11-22 14:33:59

Rio,

It says they are in the mid product cycle when the last release was July? Late in July? Wow. Thanks for the tip. At some point you have to just take the plunge, and I have some use or lose vacation that will be ideal for getting a new computer up and running. LIke I said, I just have to talk myself into it. At this point, maybe it is more like finishing talking myself into it.

And it is very pretty.

 
 
Comment by denquiry
2010-11-23 08:46:30

I got 24 inch which they don’t make anymore. I watch tv shows/series on hulu all the time. It’s just like watching a lcd tv and the commercials are only like 15 to 30 seconds on hulu.

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Comment by oxide
2010-11-22 08:49:52

The best thing about computers is that they are advanced enough and cheap enough that it’s actually pretty hard to get shafted. In 2004, I spent weeks poring over magazines and online bofore I made an agonzing decision to buy a $2400 laptop with bells and whistles. In 2009, all those bells and whistles were old hat. I walked into Best Buy and walked out 2 hours and $800 later with a Dell. No complaints, except: back up your hard drive every few months, and keep it out of direct sunlight! It’s very easy to fry hard drives that way.

Comment by potential buyer
2010-11-22 16:41:36

That and using it on your bed, so the fluff plugs up the fan.

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Comment by Bill in Los Angeles
2010-11-22 08:10:50

Thanks for admitting you hate this time of year. I will come out now and I’m saying the same thing too.

I look forward to January 1 myself. The week after winter solstice, I wait for my mutual fund distribution for DODFX and buy another batch - I buy it once per year at the end of December.

I don’t know which is worse: to hear “it’s the time of the year to…” - be kind, buy, smile, and get together with family. Why can’t all year be that time of year? Does “it’s the time of the year” corollary mean the time to beat each other up is from December 26 to Thanksgiving?

Comment by exeter
2010-11-22 08:14:19

DODFX has a lot of recovering to do.

 
Comment by Overtaxed
2010-11-22 08:18:16

December 25th is the only day of the year when you can give someone gifts and, instead of being surprised/excited, they just expect it and move on.

If you gave your kid a new bike tomorrow (unexpectedly) their head would probably explode. Give it on XMas, and it’s just another present, nothing all that special.

That’s what I hate about this time of year; taking something that should be a special thing (giving gifts) and making it about as special as picking up the tab at STBX. :(

I love New Years! Great holiday, have fun; see friends and family (with no expections of giving/getting garbage).. And I can sell stock again! :)

Comment by awaiting wipeout
2010-11-22 09:08:17

My favorite holiday is Thanksgiving. It’s all about gratitude, once you peel back the commercialism.

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Comment by Overtaxed
2010-11-22 09:20:33

Couldn’t agree more, Thanksgiving, New Years, and 4th of July are my favs. I love the 4th; I love what it stands for, and I love seeing things blow up (Mythbusters are my heros). :)

Commercialism is OK, I don’t mind buying a Turkey and some cranberry sauce for dinner. Because it’s not about “how much can/did you spend” it’s about a good dinner with people you like.. So much more “authentic” than Christmas has become.

Very sad…

 
Comment by awaiting wipeout
2010-11-22 10:07:38

Overtaxed-
Yeah, I was trying to leave out the food, but it is Thanksgiving, which means Pumpkin Pie and Cool Whip! I agree Overtaxed, it’s about sharing a great meal and leaving the vicissitudes of life behind for the day. Then off to the treadmill to beat the fat cells.

My Father’s last Thanksgiving was a reality check for me. We all knew it was his last. So eat, drink, and give thanks.

 
Comment by Kim
2010-11-22 11:55:01

Thanksgiving has my vote for favorite holiday as well. The best part is that it only lasts one day (not a five week spendfest), so it actually retains its specialness. Also, it tends to be paid for in advance, and no one expects anything more than a good meal (and maybe a football game or two). Its too bad Christmas isn’t more like it.

 
Comment by Spokaneman
2010-11-22 13:20:00

Too bad Tgiving has become the defacto kick-off of the 12-25 shopping binge, especially now that stores have broken the “open on Tgiving” taboo and Tgiving is set become just another manic shopping day. I’ll bet 10 years from now the holiday feast tradition will be pretty much forgotten.

“Good Grief” as Charlie Brown used to say.

 
Comment by In Colorado
2010-11-22 13:42:12

Once upon a time, people used to wait until Christmas to celebrate … Christmas. The timeframe merchants now call the “Christmas Season” has another name: Advent.

The infamous 12 days of Christmas are between Christmas and the Feast of the Epiphany (AKA King’s Day).

Some years ago I caught an old movie with David Niven on either AMC or TMC. In one scene people are buying and setting up their Christmas trees on … Christmas Eve.

I for one won’t be setting foot in any store on Thanksgiving (or Black Friday for that matter). I will kick back that morning, watch the parade while I read the paper, followed by the dog show.

 
Comment by polly
2010-11-22 14:24:53

My biggest issue with Thanksgiving is the travel. I have an early afternoon flight out of BWI and I’m thinking I need to leave earlier than normal to be sure of getting through the security line in time for the flight. I promised my mother I would go early, but also told her that if I missed it and they couldn’t rebook me on a guaranteed seat, that was it. I won’t sleep on the floor of the Southwest terminal at BWI just in case a seat becomes available. Too old. Not gonna do it. That being said, I’m more worried about the 20 miles or so that I have to traverse on I95 north than I am about the airport.

 
Comment by sleepless_near_seattle
2010-11-22 15:05:03

“The best part is that it only lasts one day (not a five week spendfest), so it actually retains its specialness.”

And who doesn’t love to see the Detroit Lions play “football” every Turkey Day?

 
Comment by pismoclam
2010-11-22 17:19:01

The Armenians have it made ! They celebrate X’Mas the second week in January (Greek Orthodox). Get free xmas trees, sales are in full force. Trouble is their women have big noses.

 
Comment by neuromance
2010-11-22 22:12:17

I’m more worried about the 20 miles or so that I have to traverse on I95 north than I am about the airport.

Polly, you could take the Metro to Union Station, and hit the Amtrack to the BWI Rail Station. It’s like a mile from the BWI terminal. I’m sure there are buses that go from the BWI Rail Station to the terminal. Just gotta make sure you’ve got a piece of luggage with wheels.

 
 
 
Comment by AvOcadO
2010-11-22 11:36:19

I am thankful to live in CA now, now more snow and ice to deal with, no more 20 degrees after coming out of an evening movie. Who cares if CA is broken?

Comment by awaiting wipeout
2010-11-22 13:53:01

AvOcadO
Welcome to the sunshine tax state. It’s 59 degrees today, where we live & work (east Ventura County, Ca), and my blood needs some corn starch. I’m a weather whimp.

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Comment by Spokaneman
2010-11-22 14:35:53

My 20 something daughter moved to OC CA last February. I was talking to her on the phone last night and mentioned the prediction was for -10 in Spokane on Wednesday.

She said “I sure miss the cold”, to which I replied (in a fatherly manner) Bravo Sierra. This was a kid that would put a space heater in her car overnight so it wouldn’t be cold in the morning, who would turn my furnace up to 78 and who would shiver uncontrollably at 30 degrees. Loves the cold? Yeah, right.

 
Comment by Rancher
2010-11-22 17:26:13

Yeah, right….laughing my bunns off…

 
 
Comment by GrizzlyBear
2010-11-22 14:12:12

Blech. I hate the sunburn states. I enjoy blustery, cold fall and winter weather.

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Comment by Professor Bear
2010-11-22 08:16:12

I plan to go shopping bright and early this Friday. I did it last year — not that I like to shop, but simply because I am fascinated by the behavior of those who get up before dawn to stand in line for their first shot at the holiday goodies…

Comment by GH
2010-11-22 17:43:22

You are not going to be out waiting in long lines in hopes of your $3 appliance?

I am of course being sarcastic, but personally I stay home black Friday.

 
Comment by REhobbyist
2010-11-22 18:28:51

Stay home and make pancakes for your family instead, Bear.

 
 
Comment by Steve J
2010-11-22 08:32:59

A lot of stores are opening on Thanksgiving to beat the competition.

Comment by arizonadude
2010-11-22 11:24:17

I’m going to kmart to look for something made in america.

Comment by oxide
2010-11-22 11:50:11

You’ll be there a while…

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Comment by CrackerJim
2010-11-22 11:56:59

It is a chore to simply find something not “Made in China”.

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Comment by RioAmericanInBrasil
2010-11-22 16:01:23

It is a chore to simply find something not “Made in China”.

In Brazil it’s easy. They protect their manufacturing way more than the USA.

 
 
Comment by In Colorado
2010-11-22 13:36:16

Maybe in the food aisle, unless they’re importing cookies and potato chips from China too.

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Comment by ecofeco
2010-11-22 16:56:31

Do you know how much food is imported from China?

Let’s just say “a lot.”

 
 
 
 
Comment by sfbubblebuyer
2010-11-22 14:07:38

Higher death tolls = less competition for government cheese!

 
Comment by ecofeco
2010-11-22 16:54:50

So I went to a Wally World Sale on Black Friday and a hockey game broke out.

Comment by pressboardbox
2010-11-22 19:09:56

You must get no respect.

 
 
Comment by REhobbyist
2010-11-22 18:27:17

Just ignore the idiocy, overtaxed. Thanksgiving is the best holiday - family, food and football. We stopped doing presents when the kids grew up and now for Christmas we do family, tree, food and basketball. The decorations are a bit of a hassle, but it does look nice.

 
 
Comment by Professor Bear
2010-11-22 07:47:26

The Global Dow dipped at the open, but it appears plunge protection measures are already underway to bring it back. It would be “bad” to have a global stock market selloff on the day Ireland’s bailout goes into effect; hence the monetary authorities will most likely do whatever they can to prop up global stock markets.

The Global Dow
Dow Jones Global Indices: GDOW
GDOW 2,022
Change -5.60 -0.28%
Volume 1,566.26b
Nov 22, 2010 9:45 a.m.

 
Comment by CharlieTango
2010-11-22 07:49:34

California Drought doubting - on the 1 year aniversary of climate gate.

i have 4 feet of drought to shovel to get out of my house, another mile to the west and it is 7 feet of new white drought.

the current la nina is the most severe if 60 years, last time global temps dropped 1F

its going to be another tough winter for home building in these parts.

Comment by Professor Bear
2010-11-22 07:55:44

We’re having the wettest winter in six years here in San Diego. It looks like we will have a lush spring, and low fire risk between now and then.

Comment by Arizona Slim
2010-11-22 08:02:17

Could you please send us some of that rain?

Comment by ecofeco
2010-11-22 17:07:21

Same here. 5th drought in 10 years.

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Comment by ann gogh
2010-11-22 09:20:39

and fleas!

 
 
Comment by WT Economist
2010-11-22 08:22:19

Well, an end to the drought may be as important to California in a positive sense as the continued recession is in a negative sense. Things were looking grim.

 
Comment by DennisN
2010-11-22 09:09:59

Looks to be an early winter here in Boise. There’s snow on the ground already and it’s supposed to get down to -1 degrees F Tuesday night. People who put off blowing out their sprinkers until after Thanksgiving are going to be screwed come springs.

Stanley ID is supposed to get down to -26 degrees F Wednesday night.

Brrrrrr……

Comment by 2banana
2010-11-22 12:20:54

Damn you global warming!

Comment by MrBubble
2010-11-22 13:24:23

Climate (and climate change) != weather. You might not have the time or inclination to look at any of the non-partisan (because it has been made into a partisan issue by both sides) information, but at least that concept is easy to understand.

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Comment by RioAmericanInBrasil
2010-11-22 14:01:08

You might not have the time or inclination to look at any of the non-partisan (because it has been made into a partisan issue by both sides) information, but at least that concept is easy to understand.

When I try to explain to educated Brazilians how the climate change and pollution issue is divided by party lines in America, they don’t even understand what I’m talking about.

 
Comment by ecofeco
2010-11-22 17:09:02

Because it’s not. It’s divided between the corporations and everyone else.

 
 
Comment by pismoclam
2010-11-22 17:24:23

Gore said he made a mistake on ethanol. Carbon trading cancelled on CBOT in October.

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Comment by Spokaneman
2010-11-22 13:23:09

The local weather guy was in full panic mode this morning because …….. its going to be cold and snowy this week. Well, duh, Spokane is 70 miles from the 49th parallel.

 
 
Comment by Elanor
2010-11-22 10:42:54

The high temp in Chicagoland today is forecast to be 67 degrees.

However, I’ve already had one watering wand blow out and spew water all over the patio when the temp hit near freezing over the weekend. It is an annual rite of spring in our household to buy new watering implements. :roll:

Comment by Kim
2010-11-22 11:56:23

“The high temp in Chicagoland today is forecast to be 67 degrees.”

Yeah, but aren’t we due for snow Wednesday or Thursday?

Comment by RioAmericanInBrasil
2010-11-22 13:26:34

Mild spring so far in Rio. No days over 85 but it’s been pretty humid lately. I have not used the A/C…. yet.

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Comment by Elanor
2010-11-22 13:31:00

Yeah, but aren’t we due for snow Wednesday or Thursday?

Shhhhh! Let me live my little springtime fantasy for today. ;)

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Comment by DennisN
2010-11-22 13:46:49

Geez - Kirkwood is reporting 125 inches of new snow in the past 3 days!

http://www.sfgate.com/cgi-bin/blogs/ski/detail?entry_id=77547&tsp=1

 
Comment by DennisN
2010-11-22 15:35:47

Look for frost damage to the California orange crop this week.

The lowest temperatures are forecast to occur late Wednesday night into Thanksgiving Day morning, when several hours of below-freezing temperatures can occur in areas between Porterville and Bakersfield.

According to Agricultural Meteorologist Dale Mohler, “Low temperatures in some of the groves may dip as low as 24 degrees Thursday morning.”

http://www.accuweather.com/blogs/news/story/41962/freeze-coming-to-california-or-1.asp

 
Comment by fisher
2010-11-22 20:02:29

Dry as a popcorn fart in the NM mountains. Had a couple of veeeeery light dustings this month in place of the usual early blizzards. Very dry.

 
 
Comment by Professor Bear
2010-11-22 08:06:54

Gold Bug credo: In Fed we Trust?

Peter Brimelow

Nov. 22, 2010, 2:13 a.m. EST
Gold bug experiments with stocks — and real estate
Commentary: Forecasts & Strategies cynically short-term bullish

By Peter Brimelow, MarketWatch

NEW YORK (MarketWatch) — Another long-time gold bug is cynically short-term bullish on stocks — and maybe even real estate.

Mark Skousen, the brash, battle-scarred veteran editor of Forecasts & Strategies, turned 60 on the 20th anniversary of the ’87 Crash. I wrote a friendly column — which he typically didn’t like — pointing out that, at least as monitored by the Hulbert Financial Digest, he appeared to be moving into his golden years. ( See Oct. 25, 2007, column.)

Literally. Skousen is one of a group of libertarian-oriented advisers — he runs a conference called Freedomfest in Las Vegas every summer — who were active during the last precious-metal boom that peaked out early in the 1980s.

Skousen is still benefitting from gold, and especially silver, this time around. But he also shows a healthy respect for the ability of the Federal Reserve to reinflate and get stock prices moving again.

He wrote recently: “The Federal Reserve has adopted a deliberately inflationary policy by keeping interest rates low. The action is bolstering our portfolio and pushing gold to new highs.

 
Comment by Professor Bear
2010-11-22 08:12:55

More painful wrist slapping is on the way for Wall Street playas caught in the act of insider trading.

market pulse

Nov. 22, 2010, 9:45 a.m. EST
Financial stocks fall as insider probe talk grows

NEW YORK (MarketWatch) — Shares of U.S. financial stocks fell on Monday as word spread about the details and reach of a government probe into possible insider trading in on Wall Street.

Comment by arizonadude
2010-11-22 08:25:57

They would have to arrest most of wall street to deal with insider trading.Thats the cash cow for them.

Comment by Professor Bear
2010-11-22 08:42:35

I don’t see this as any reason to not jail anyone found guilty of committing a felony. The only way to reinstate a rule of law in the financial sector is to begin vigorously enforcing the laws which are on the books against the biggest violators.

Comment by Housing Wizard
2010-11-22 09:49:35

Here is a older tape talking about the real reason behind the Tarp bailout .

THE REAL REASON FOR THE BAILOUT ( HINT FOREIGNERS )

http://www.youtube.com/watch?v=GqIFoBXGizc&feature=related

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Comment by arizonadude
2010-11-22 10:15:31

You could arrest most of the cronies at goldman to start cleaning house.

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Comment by ecofeco
2010-11-22 17:11:39

They’ve already started the raids.

Diamondback Capital Management LLC and Level Global Investors LP (now called Level Management LP) as well as Loch Capital Management were raided today.

 
 
Comment by Professor Bear
2010-11-22 09:06:39

Several respondents confounded the potential benefits of
eliminating the mortgage interest deduction with a mistaken presumption that the change would necessarily happen overnight, severely disrupting housing prices. By contrast, James Hamilton astutely separated the long-term benefits of eliminating a market-distorting policy from the question of what would be the best interim adjustment path for eliminating it.

EconoMeter: Should mortgage interest deduction be eliminated?
By Roger Showley, UNION-TRIBUNE
Saturday, November 20, 2010 at 6:05 p.m.

The verdicts from our experts:

Yes: 5

No: 3

Is reducing or eliminating the mortgage interest deduction a good way to cut the federal deficit?

Ask the economists: Each week the Business section will ask its panel of economists to weigh in on an economic issue of concern to San Diegans. They’ll answer yes or no, up or down or give a neutral response. Sometimes they might be unavailable to participate. If you have a question you’d like them to address, send it to roger.showley@ uniontrib.com.

This week’s question:The president’s deficit reduction commission unloaded a bombshell of sorts recently, when it proposed ending the mortgage interest deduction or at least scaling it back to apply to loans of no more than $500,000 and to owner-occupied, principal residences. Offsetting such a change would be lower marginal tax rates. The deduction is worth about $100 billion annually in tax savings to homeowners. Is reducing or eliminating the mortgage interest deduction a good way to cut the federal deficit?

James Hamilton, University of California San Diego:

Answer: Yes

Although there are some public benefits from a higher rate of homeownership, the U.S. has gone way too far in trying to subsidize this sector. Freeing up investment capital to make working Americans more productive would be a better use of our resources than building bigger houses.

However, we do not want to be piling added burdens on the housing sector at this point in the cycle.

I recommend setting a fairly high limit for the amount of mortgage payments that can be deducted with a schedule for gradual reduction of that limit over time.

Comment by ecofeco
2010-11-22 17:17:18

Working Americans are the most productive in the world.

What we need are more jobs. Lots more.

And extending tax breaks for offshoring jobs is NOT the way to do it.

But hey, let’s give the party that voted for keeping those tax breaks more power because we think the current party isn’t doing enough to provide jobs.

Even though it was the Dems that proposed ending the tax breaks and the Repubs who blocked it..

Truly we have government and society we deserve.

 
 
Comment by cobaltblue
2010-11-22 09:21:00

Ireland: Bailout Down The Drain?

Questions remain…..

The government is under siege, with protesters attempting to storm Parliament. More-ominously, however, is that The Green Party appears to have pulled out from their government coalition, which would mean that any budgetary reforms that are as a condition of the bailout could fail.

That, in turn, would trash the entire process.

The EU in turn has said that Ireland is willing to consider “softening” their position on the corporate tax rate. This has trouble written all over it, as much of the “Irish Miracle” has been due to the very low corporate tax rate that dragged a number of corporate headquarters there - including some from the United States. Should changes in tax rates promote corporate flight further serious pressure would be placed on government budgets due to the loss of jobs and thus tax revenue.

The ultimate problem with bailouts is that everyone seems to think there’s a free lunch. There isn’t. You can rob someone to pay someone else, but you can’t conjure up money from nowhere. But bailouts inherently wind up taxing the people who got robbed in the first place to pay off the people who made the bad bets and lost money. When it comes to bailing out banks it gets even worse due to the leverage involved - the banksters keep the money, including their salary and bonuses, while the people get robbed not only in the form of losses on their so-called “safe” investments but then again when they are taxed to fund the bailout!

There’s nothing like getting stuck up at gunpoint and not only losing the hold-up money but then being taxed a second time to pay for the robbery in which you were victimized!

This nonsense has to stop and the banks involved must be taken into receivership, reorganized, and the executives involved removed from their positions, tried and jailed.

(From K. Denninger)

Comment by theoracleofnebraska
2010-11-22 11:35:23

bad bets and lost money

They didn’t lose the money. They made their fair share in the forms of salaries and bonuses.

Comment by In Colorado
2010-11-22 13:32:44

Or as the Frito Bandito did in one of his now banished commercials:

“I will perform a magic trick. I will take all your Fritos and convert them into my Fritos.”

 
 
Comment by Professor Bear
2010-11-22 20:54:21

Whadayaknow — The Irish financial meltdown had a lot to do with a property bubble. Who’d'vethunkit?

Ireland Went Down With Its Banks. Why Didn’t That Happen In The U.S.?

Categories: Government, Housing, Debt

10:05 am
November 22, 2010

Ireland and the U.S. both bailed out their banks during the heat of the financial crisis.

In the U.S., the banks have made a strong comeback, and the government has been paid back for a big chunk of the bailout. In Ireland, the banks have driven the nation to the brink of bankruptcy.

Why the difference?

Irish banks were in much worse shape than U.S. banks, and they were much bigger relative to the overall economy.

This chart shows the astonishing amount of risk that Ireland took on when it guaranteed its banks.

The U.S. isn’t on the chart, which is based on EU data. But Jacob Funk Kierkegaard, the Peterson Institute fellow who put the chart together, told me that the U.S. would be somewhere to the left of the U.K. Roughly speaking, the U.S. was on the hook for somewhere around 10 percent of GDP, Kierkegaard said.

“We’re not talking about getting even close to Ireland, or, for that matter, close to the U.K.,” he said.

What’s more, during the boom, home prices rose even more in Ireland than they did in the U.S. So prices also have further to fall, which means more trouble for Irish banks.

It’s as if one of the regions in the U.S. where the housing bubble was the craziest — South Florida, say — was a whole country.

 
 
Comment by Professor Bear
2010-11-22 09:26:27

Here is a dubious distinction if ever there was one.

Controversial study again calls St. Louis the most violent US city

AP/St. Louis Public Radio (2010-11-22)

ST. LOUIS (St. Louis Public Radio) - City officials are again decrying an annual report that consistently ranks the city of St. Louis as one of the most dangerous in the country.

St. Louis again led CQ Press’s crime rankings, beating out Camden, N.J., which led the list last year. CQ Press found St. Louis had more than 2,000 crimes per 100,000 residents, well above the national average of about 430 violent crimes for 100,000 residents.

Comment by In Colorado
2010-11-22 13:31:06

This reminds me of an old Johnny Carson gag. IIRC he had a fake sweepstakes in a skit (Tea Time Theatre?): where 1st prize was a 1 week all expenses paid vacation in Newark, NJ.

2nd prize: a 2 week all expenses paid vacation in Newark, NJ.

 
 
Comment by Faraway
2010-11-22 09:32:15

In BC now for a month. Real estate prices here are a subject of debate. From the Canada bubble blog greaterfool dot ca this typical bull comment today:

“TheBestPlaceonEarth on 11.22.10 at 3:06 am said:

Things are looking great. Even Garth is looking at a 15 – 20% haircut***DEPENDING ON THE MARKET***
No one dare argue with the fact that Asians love home ownership and love Vancouver. This is an unstoppable train folks. That half duplex on the West Side for 1 million so worse case it drops 20% at 800k how many Canadians could afford 800k with higher interest rates? The answer of course is zero. The problem is people are looking at Vancouver with logic and past history and future projections and employment etcetcetc. WHO CARES!!! Asia is banging on the door and the more likely scenario over the next 10 years is a 100% increase in values. Vancouver will make Tokoyo look like Weyburn Sask price wise in the near future. I feel sorry for Canadians, poor, renting and dealing with bed bugs. It’s a tough pill to swallow but nobody trusts or likes a renter we all consider them druggies.”

Comment by In Colorado
2010-11-22 09:58:47

I wonder if Asians will still love Vancouver when it resembles home. Maybe they get a kick out having blond, blue eyed Canadians serving them their meals and cleaning their houses for them.

 
Comment by GrizzlyBear
2010-11-22 13:02:49

It’s hard to find a city with a bigger real estate bubble than Vancouver. Happy POPPING!

 
Comment by Spokaneman
2010-11-22 13:26:28

The Japanese loved SoCal Real Estate in the mid 80’s too. But, that wound up not working out so well.

 
 
Comment by Spokaneman
2010-11-22 10:07:34

http://getpaidtobuyyourhouse.com/

A new family moved into a “middle of the night abandonment” house down the street from me. Glad to see the house occupied. One down two to go.

About two weeks ago, I noticed a Ford Explorer in the driveway garishly festooned with “Get Cash to Buy A House” and other catchy slogans all over it. The above website explains his program.

Sheesh, buy a house to get a $1,500 rebate? Now thats some clear thinking.

Comment by Arizona Slim
2010-11-22 10:59:17

I can’t help thinking that this a tax fraud in progress. And you could be a really unfriendly neighbor and report it. Here’s some info from our friends at the IRS.

Comment by Spokaneman
2010-11-22 12:28:47

I would think that as long as a 1099 were issued to the buyer, and the buyer reports the transaction, it should be ok. In fact, I would take the position that it was a reduction in the tax basis on the house.

Notwithstanding all of that it just stikes me as goofy.

I’ll leave the nieghbor alone, he is occupying one of the abandoned houses in the ‘hood, which is a good thing.

 
 
Comment by RioAmericanInBrasil
2010-11-22 13:45:21

festooned

“Festooned”!

Congratulations Spokaneman. You were the first person to correctly use today’s “secret word of the day” in a sentence!

Comment by Spokaneman
2010-11-22 14:45:19

If you had seen the realtormobile, Festooned would have come to your mind also.

Comment by Ol'Bubba
2010-11-22 19:36:54

Not just festooned.

Garishly festooned.

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Comment by Faraway
2010-11-22 10:36:39

A few kickers used to boost the BC bulls position are that the enormous profits from BC Bud are plowed into real estate, that global warming acceleration and water shortages elsewhere will make BC seem balmy and well-watered, that societal chaos in the US and elsewhere in the world will make the wealthy flee to the appealing safe haven of BC, etc.

Plausible?

Comment by arizonadude
2010-11-22 11:21:00

I heard az is going to be a tropical destination soon because of climate change.

 
Comment by cobaltblue
2010-11-22 12:03:26

Yes, except that there are new methane gas ventings in Siberia erupting quite a bit now; and if it continues, you could have global warming up to several hunded degrees, as upon Venus.

 
 
Comment by AvOcadO
2010-11-22 11:23:51

Why is it that I cant find a single solid investment? I am in all cash getting 1.5%. yaaawwwwn…

Comment by Arizona Slim
2010-11-22 11:27:00

You’re not the only one.

Stock market’s turned into a huge casino. Commodities? They go up sharply. Then they go down sharply.

As for real estate? Well, that’s why we’re here.

[[[sigh]]]

Comment by Rancher
2010-11-22 17:31:58

Slim,
I’m working on it, give me some more time.

Still setting up the LLC and the Nevada trusts.

 
 
Comment by 2banana
2010-11-22 11:47:22

Define “solid”

and

Define “investment”

Comment by arizonadude
2010-11-22 14:58:59

solid = cant lose principal

investment= hope a return on your money

Stocks on avg fall 5 times faster than they rise.

 
 
Comment by ecofeco
2010-11-22 17:21:58

Because the only real deflation is wages, investments and RE.

Looked at commodity prices lately?

 
 
Comment by potential buyer
2010-11-22 12:04:57

Making email rounds right now:

The FixThere recently was an article in the St. Petersburg , Fl. Times. The Business Section asked readers for ideas on: “How Would You Fix the Economy?” I think this guy nailed it!

Dear Mr. President,Please find below my suggestion for fixing America ’s economy. Instead of giving billions of dollars to companies that will squander the money on lavish parties and unearned bonuses, use the following plan.You can call it the “Patriotic Retirement Plan”:There are about 40 million people over 50 in the work force. Pay them $1 million apiece severance for early retirement with the following stipulations:1) They MUST retire. Forty million job openings - Unemployment fixed.2) They MUST buy a new AMERICAN Car. Forty million cars ordered - Auto Industry fixed.3) They MUST either buy a house or pay off their mortgage - Housing Crisis fixed.It can’t get any easier than that!!P.S. If more money is needed, have all members in Congress pay their taxes…Mr. President, while you’re at it, make Congress retire on Social Security and Medicare. I’ll bet both programs would be fixed pronto!If you think this would work, please forward to everyone you know.If not, please disregard.

Comment by 2banana
2010-11-22 12:26:33

By this math -

40 million x $1 million = $40,000,000,000,000

$40 Trillion dollars???

For comparison, the entire Gross Domestic Product (GDP) for everything in America for 2010 is $14.5 trillion.

 
Comment by Spokaneman
2010-11-22 12:32:01

$1million to retire? Count me in; in fact I will do it for half that amount since I don’t have a mortgage to pay off.

Comment by rms
2010-11-22 12:52:14

“$1million to retire?”

Friend has $1.2M in a safe gov-bond fund, earning diddly.

Comment by Spokaneman
2010-11-22 14:49:19

As you get older, you start thinking in number of years to fund, so I figure $1million at 62, gives me $50K a year for 20 years, pure gravy. By the time I’m 82 it having the 50K go away won’t be a huge deal.

I’m assuming that the largess will be tax free.

(Comments wont nest below this level)
 
 
Comment by Arizona Slim
2010-11-22 12:55:33

A million to retire? At age 53? No thanks!

But I’ll happily take the million. I’ve got an entrepreneurial idea or two that could use some of that money.

 
 
 
Comment by Professor Bear
2010-11-22 13:04:34

[Deleveraging, speaking to Mr Market]: “Ruff ruff! Grrrrr…”

Euro, Stocks, Commodities Fall on Debt Contagion Concern
By Rita Nazareth and Jeff Kearns - Nov 22, 2010 11:07 AM PT
Euro, Asian Stocks Climb After Ireland’s Bank-Rescue Package

The euro climbed against the dollar and yen amid optimism an agreement to rescue Ireland’s banks will prevent contagion across European debt markets. Photographer: John Guillemin /Bloomberg

The euro snapped a three-day rally versus the dollar, stocks and commodities slid and Treasuries advanced as Ireland’s financial bailout failed to assuage concern Europe’s debt crisis may spread. Banks led U.S. equities lower after federal officials searched three hedge funds.

The euro slid 0.6 percent to $1.3596 at 2:06 p.m. in New York and depreciated versus 13 of 16 major counterparts. The Standard & Poor’s 500 Index fell 0.8 percent to 1,190.59 and the S&P GSCI Index of commodities declined 0.3 percent. The costs to protect Irish and Portuguese debt from default surged, while the 10-year U.S. Treasury yield decreased four basis points to 2.83 percent before a sale of $99 billion of notes this week.

Banks led European and U.S. equities lower as Ireland became the second euro member to seek a rescue from the European Union and the International Monetary Fund, a move that may prevent a run on its lenders while threatening its credit rating and government coalition. Benchmark indexes extended declines as the Federal Bureau of Investigation confirmed that it searched two Connecticut-based hedge funds.

Deleveraging is sort of like a terrier,” said James Dunigan, chief investment officer at PNC Wealth Management in Philadelphia, which oversees $105 billion. “It keeps annoying you. We’ve addressed Ireland’s problems, but nobody knows who’s next.

 
Comment by Muggy
2010-11-22 13:05:04

Question to the HBB brain trust: I might possibly have a forthcoming job offer that would nearly double my salary. In my current position, I have tenure, reputation, stability, etc. Unless something goes terribly wrong (like, say, house prices) I’ll be able to have nice career/middle-class (I think) life — riding it out in a traditional K12 educational setting.

The other outfit is like saddling up a wild bronco. There is no guarantee of anything, but they are certainly making a dent in educational reform.

Trading $ for stability… not an easy decision.

Comment by WT Economist
2010-11-22 13:44:19

Would you still have a job if the teaching staff where you are was cut by 25 percent, based on your seniority? Beware the Pension Tsunami. In NY, next year may be Doomsday. A five percent cut is likely, but 25 percent is not inconceivable, and after that you may not want to be there even if you survive.

Comment by Muggy
2010-11-22 14:46:06

“Would you still have a job if the teaching staff where you are was cut by 25 percent”

Yes, and that is a likely scenario.

 
 
Comment by Professor Bear
2010-11-22 14:06:05

1. Do you have enough savings to stave you over until you could find another position, in case the ‘bucking bronco’ lands you on your patootie?

2. How long do you think it would take you to find another position, in case this one abruptly ends?

3. Do you anticipate having a way to make ends meet w/ other (short-term) income sources in case you end up out of work for a spell?

4. Can (does) your spouse supplement the household income, in case you need her to do so?

5. How important is it to your career development to conduct the work which this new position would entail?

I was out of work in the early-1990s after taking a higher paying position which did not work out for me; in retrospect, I should have asked myself the above questions, though as it turned out, I was OK in every respect, except that it proved very hard to find work in a down economy.

Comment by Red Beach
2010-11-22 17:10:46

1. Do you have enough savings to stave you over until you could find another position, in case the ‘bucking bronco’ lands you on your patootie?

Maybe, it’s a weird play between having daycare and not. So, if I was bucked, I would pull the kids from daycare.

2. How long do you think it would take you to find another position, in case this one abruptly ends?

I *think* I could return to my current district, but that would all depend on timing. Teachers usually leave in the fall or right after the 1st if the year.

3. Do you anticipate having a way to make ends meet w/ other (short-term) income sources in case you end up out of work for a spell?

No! That’s what scares me the most. I’m as useless as the next “vibe” guy.

4. Can (does) your spouse supplement the household income, in case you need her to do so?

The Wifester and are basically 50/50 now, and could not survive on either our incomes in our current setup. This is not a choice, btw.

5. How important is it to your career development to conduct the work which this new position would entail?

This is the one question that really got me thinking. I hear a lot about “educational reform” AKA charter schools, but this is a quasi-public entity that uses the online format to deliver custom lessons, dependent on your background knowledge and learning style. Now, this is how teaching is *supposed* to be, but doesn’t always happen. The pendulum will swing… I don’t know what online learning will look like in ten years. It will either be a serious contender, or won’t. This company, makes it a companion, not a replacement — that’s why I think they’re sane; they’re not trying to change everything, just a few things.

 
 
Comment by In Montana
2010-11-22 14:45:59

‘but they are certainly making a dent in educational reform. ‘

Does the enterprise rely on grants? I’ve seen some of those outfits blow up right quick.

Comment by Red Beach
2010-11-22 17:12:13

Naw, far from it. There are research components that are grant-based, but those fly in the open and those guys know they are crash test dummies.

 
 
Comment by ecofeco
2010-11-22 17:25:00

Are you familiar with the old saying “A bird in the hand…?”

Job security is the most rarest of thing to come by these days.

 
 
Comment by Jim A.
2010-11-22 14:09:14

I find it amusing that one of the google ads that I see here is for the Silo Point condos in Baltimore: http://www.silopoint.com/home.html Something we talked about here a few years ago when it was proposed. http://thehousingbubbleblog.com/?p=724

 
Comment by pressboardbox
2010-11-22 14:37:24

I just made an offer on a house. Well, I guess you could call it a house- Less than 800sq/ft pos for under $20k. Pretty sure I can rent it out with minimal work for $500/mo to some misfortunate newly-evicted FB. Been thinking about what Ben said the other day… The youtube video with the fat NY itlaian-looking guy hit home as well. Wish me luck…

Comment by Spokaneman
2010-11-22 14:53:13

If you can get $6,000 a year in rent for <$20K, that is the deal of the century, well at least the decade.

 
Comment by exeter
2010-11-22 17:17:32

There it is…. That’s the way to do it.

Good luck with it pressboard.

 
Comment by ecofeco
2010-11-22 17:28:48

That’s a good deal if you can make it work.

$500 rent is very reasonable. In fact, pretty rare these days.

Also, don’t cut too many corner on the rehab or you’ll just have do them again sooner than later.

 
 
Comment by Professor Bear
2010-11-22 14:54:42

Is there a chance of another post-Lehman-sized dip in the stock market next year?

Just curious — I don’t have much skin in that game to speak of…

€90bn Irish bailout ends in turmoil – now Europe fears crisis will spread

• Brian Cowen defies calls for resignation
• Fears that Portugal and Spain may need aid
• International rescue plan does little to calm markets

* Jill Treanor, Nicholas Watt and Henry McDonald in Dublin
* guardian.co.uk, Monday 22 November 2010 21.16 GMT
* Article history

Irish Prime Minister Brian Cowen leaves a news conference Markets thrown into ­turmoil amid fears of a collapse in Ireland’s ­government. Photograph: Cathal Mcnaughton/Reuters

Financial markets were thrown into turmoil today amid fears that an imminent collapse in Ireland’s beleaguered government would have a knock-on effect across the eurozone.

The announcement of the potential €90bn international bailout for debt-laden Ireland – of which the UK could contribute up to £10bn – offered only a temporary respite to nervous markets.

By tonight, concerns that Portugal and even Spain might also need their own rescue packages were rising and sent the euro and shares falling while the risk of holding the debt of potentially vulnerable countries rose alarmingly.

After a tumultuous day in Dublin, where protesters tried to storm the parliament building, the prime minister, Brian Cowen, defied calls for his resignation but conceded he would call an election in the new year. The move was forced upon him after the Green party pulled out of his fragile coalition government, unnerving markets on a day which was supposed to restore confidence in Europe’s decade-old single currency.

Instead there was a sense of growing unease in the markets amid evidence that investors felt Portugal would not survive without aid. Dealers said sentiment in the markets was reminiscent of the days after the collapse of Lehman Brothers in September 2008.

Comment by Professor Bear
2010-11-22 16:13:18

Is this situation really dire, or does it merely sound really dire?

IMF faces questions over Irish bail-out
By Alan Beattie in Washington

Published: November 22 2010 20:22 | Last updated: November 22 2010 20:22

…former officials say that, while the IMF’s involvement boosts the institution’s standing, which has risen sharply during the global financial crisis, the size and nature of the Irish question could place the fund in a politically awkward position.

Domenico Lombardi, a former Italian representative at the IMF and now at the Brookings Institution think-tank, says: “With Greece you could argue that it was just a single country in trouble. But with Ireland it is now clear that this represents an attempt to underpin the entire euro area.”

 
Comment by GH
2010-11-22 17:41:50

It is becoming increasingly clear - The difference between what is happening here in the US and what has happened in some EU countries has a great deal to do with our ability to print the money used to bail out our banking sector and continue govt operations, where they are not authorized to print Euros, so they have to deal with the situation at hand. I am not sure which is worse off, but I AM certain that we all have to come to terms with one unpleasant thought, and that thought is that however you look at it and whoever you believe to be responsible, the party was thrown with LOADS of debt, and the hangover is the repayment of that debt and the money and underlying value is ALL GONE!

I am not sure I understand who is owed this money in totality, since it appears much of the money loaned was loaned into existence out of thin air and in many cases exceeds the ability of those responsible for repaying it by a huge margin.

Comment by Professor Bear
2010-11-22 18:04:52

“…the hangover is the repayment of that debt and the money and underlying value is ALL GONE!”

Bailout, extend-and-pretend and bagholder identification operations continue to play out…

 
Comment by combotechie
2010-11-22 20:25:54

“I am not sure I understand who is owed this money in totality, since it appears much of the money loaned was loaned into existence out of thin air and in many cases exceeds the ability of those responsible to repaying it by a huge margin.”

Which means it is up to each individual to make sure he/she is not one of those people on the wrong end of owed money that will never be paid.

Comment by Professor Bear
2010-11-22 20:57:46

“Which means it is up to each individual to make sure he/she is not one of those people on the wrong end of owed money that will never be paid.”

But playing the Devil’s advocate, if millions and millions of Americans will soon (if not already done) go through a default on their home loans and other debt, won’t they get a sort of pass on their future credit ratings, thanks to societal forgiveness of ‘herd stupidity’?

(Comments wont nest below this level)
 
 
 
 
Comment by cobaltblue
2010-11-22 15:06:01

In the first full week of the latest iteration of post-QE2 POMO, which was supposed to see a dramatic ramp in stocks, the only thing we have seen is the biggest insider buying to selling imbalance since the data has been tracked. Overall, selling by S&P500 insiders was 8,279.5x times greater than buying (per Bloomberg). There were 5 insider buys for a total of $150,673, and 117 sales for a total of $1,247,500,249. There is no point to even discuss what this data point indicates.

(Except that it does not favor a bullish scenario moving forward.)

 
Comment by X-GSfixr
2010-11-22 15:23:15

Whadda y’all think of this plan?

-Indict every hedge fund manager/Vampire Squid in the country

-Extend unemployment benefits, with the provision that all recipients have to perform Jury Duty for the Squid trials.

Two birds with one stone……..me likey…. :)

Comment by ecofeco
2010-11-22 17:30:00

:lol: BRILLIANT!

 
Comment by pressboardbox
2010-11-22 19:06:31

GS Fixer for Congress!

 
Comment by Muggy
2010-11-22 19:12:05

“The Squid Trials”

Love it!

 
 
Comment by Professor Bear
2010-11-22 15:53:43

I saw a comic strip today which showed Einstein writing at the board:

“Q. What do you call doing the same thing over and over again, expecting different results each time?

A. Insanity. California.”

Brett Arends’ ROI

Nov. 22, 2010, 5:29 p.m. EST
The truth about California
Commentary: Maligned state is actually saving the rest of us
By Brett Arends, MarketWatch

BOSTON (MarketWatch) — Can everyone please stop talking total nonsense about the California budget?

I know that facts and truth seem to be optional these days. I know that in the exciting new world of infinite media everyone can choose to believe whatever fantasies they want. But in the case of California, it’s getting on my nerves.

Last week Chris Whalen, the high-profile analyst at Institutional Risk Analytics, caused a stir by arguing California was going to default on its debts.

“I think they’re going to default… I think eventually the debt will have to be haircut,” he told Henry Blodget, the former dot-com analyst and now editor of Business Insider. “I don’t think the Republican Congress is going to sign on for a bailout of California.” Default was “inevitable,” Whalen added, and suggested Sacramento might have to start issuing its own currency.

 
Comment by lavi d
2010-11-22 16:17:08

Good discussion on student loan debt

 
Comment by Kirisdad
2010-11-22 17:42:14

Thanks Lavi d, very few comments about the absurd tuition costs at private universities. Most people question the woman’s intelligence. I question the morality of institutions of higher learning, that allow 18 yo’s to borrow $200,000, for a degree/career that couldn’t possibly handle the debt load. They’re getting paid to educate and yet, they let this travesty continue. I place university leaders on the same bottom rung as banksters and realtors.

Comment by pressboardbox
2010-11-22 19:11:19

…and attorneys.

 
Comment by In Colorado
2010-11-22 20:03:17

My daughter was offered a few 50% scholarships to attend private schools. Big whoop! It still qould have been 20K+ per year out of pocket. Why bother when the local State U, which also gave her a private scholarship, is 4K per year?

 
 
Comment by Professor Bear
2010-11-22 18:02:54

Lies, Damned Lies and Foreclosures

* HOMES
* NOVEMBER 23, 2010

Foreclosure Detectives Hunt for Lies
By RUTH SIMON

URBANDALE, Iowa—In two squat, suburban office-park buildings here, Richard Barrent is digging through loan files that could help decide who pays for the mortgage-paperwork debacle.

The former Wells Fargo & Co. quality-assurance manager’s two-year-old company is part of a cottage industry of loan detectives obsessed with detecting fraud, misrepresentations and violations of underwriting guidelines. Such discoveries can be used as ammunition to force banks and other lenders to buy back loans from bond insurers, holders of mortgage-backed securities and other customers of forensic loan-review firms.

“There is a growing interest across the board” for such reviews, says Charles Cacici, managing member of Risk Management Group, a Brooklyn, N.Y., company that also scours mortgage files for problems. Competitors include Digital Risk, Clayton Holdings and Allonhill.

 
Comment by Professor Bear
2010-11-22 21:00:45

The Global Dow seems highly determined this evening to reflect good old-fashioned fundamental market reaction to the Irish bailout (i.e., “This sucker’s going down”).

It’s funny how this typically does not happen while the U.S. market is open, no?

Comment by Professor Bear
2010-11-22 23:50:05

Looks like the news of the suddenly-hot Korean conflict may have kicked the selloff into high gear?

 
 
Comment by Professor Bear
2010-11-22 21:10:53

Those Asians need to figure out the plunge protection team thingee…

market pulse

Nov. 22, 2010, 11:00 p.m. EST
Hong Kong, Shanghai stocks plunge deeper
By Michael Kitchen

LOS ANGELES (MarketWatch) — Hong Kong and Shanghai stocks continued their descent midday Tuesday, with the markets in broad retreat and with banks and housing-related plays sharply lower.

 
Comment by Professor Bear
2010-11-22 23:00:13

* ECONOMY
* NOVEMBER 23, 2010

White House to Lose Two Top Economic Aides

By DAMIAN PALETTA

WASHINGTON—Two more of the Obama administration’s top economic advisers are departing at a time when the White House is facing growing opposition to their economic policies on Capitol Hill.

White House National Economic Committee Deputy Director Diana Farrell and Treasury Department Assistant Secretary for Financial Institutions Michael Barr are both planning to leave within weeks, people familiar with the matter said.

In another key move, White House senior adviser David Axelrod plans to leave in late January or early February, at least a month earlier than expected. He had previously said he would leave in early spring to begin assembling Mr. Obama’s re-election campaign. Mr. Axelrod’s departure will hasten the arrival of David Plouffe, who managed the president’s 2008 campaign and will take a senior adviser position at the White House.

 
Comment by Professor Bear
2010-11-22 23:37:56

This news should be welcome to folks who have dollars stuffed under their mattresses.

market pulse

Nov. 23, 2010, 1:24 a.m. EST
North, South Korea trade artillery fire: reports
by Michael Kitchen

LOS ANGELES (MarketWatch) — North and South Korea both reportedly fired artillery shells Tuesday at an island near the two nations’ western border. Reports from the region said the North launched dozens of rounds at the island, identified by the Associated Press as South Korea’s Yeonpyeong island. Several reports cited unnamed South Korean officials as saying Southern forces then fired back. The exchange follows claims by North Korea that it has opened an advanced uranium-enrichment facility. The news sent the Korean won falling against the U.S. dollar in forward trade, with the greenback rising to 1,155 won compared to Tuesday’s spot close of 1,137 won, according to Dow Jones Newswires.

 
Comment by Professor Bear
2010-11-22 23:43:33

So much for supply-side economics. Come to think of it, we have the fruits thereof to show over here as well — in the form of 19+ million vacant housing units! Guess what? Supply side economics coupled with Fed-funded asset price supports is a recipe for economic disaster!

Columns November 21, 2010, 8:56PM EST
Ireland Shows Supply-Side Shortcomings
The rapid declawing of the debt-ridden Celtic Tiger should spell the demise of supply-side economics—especially for Congress

By Chris Farrell

It may be the most famous dinner in economic history. Arthur Laffer was a professor at the University of Chicago. In December 1974 he dined at the Two Continents Restaurant in Washington, D.C., with Donald Rumsfeld, chief of staff to President Ford; Dick Cheney, Rumsfeld’s deputy; and Jude Wanniski, associate editor at The Wall Street Journal. According to Wanniski, Laffer grabbed a napkin and pen and sketched out the Laffer Curve, illustrating the trade-off between tax rates and tax revenues. In a few more years the tax-cut philosophy dubbed supply-side economics would dominate fiscal policy under President Ronald Reagan.

The global darling of supply-side economics was Ireland. The island nation was a European backwater for decades, a poor, depressed nation best known for its millions emigrating and for Guinness Stout. But in the 1980s and 1990s, Ireland started cutting taxes, and in the 1990s and 2000s it was growing at a phenomenal rate. The top marginal tax rate on personal income went from 65 percent in 1984 to 42 percent by 2000. More importantly, the corporate tax rate was cut in stages from 50 percent in 1986 to 12.5 percent by 2003. Ireland posted an average growth rate of more than 7 percent a year from 1997 to 2007, the quickest pace among the 30-plus members of the Organization for Economic Cooperation and Development. Ireland was the Celtic Tiger, the Irish Miracle.

When the current U.K. Chancellor of the Exchequer, George Osborne, was MP for Tatton and Shadow Chancellor, he penned an op-ed in the Times of London in 2006. Osborne called on Britain to learn how to run an economy from Ireland. “In Britain, the Left have us stuck debating a false choice,” he wrote. “They suggest you have to choose between lower taxes and public services. Yet in Ireland they have doubled spending on public services in the past decade while reducing taxes and shrinking the State’s share of national income.” Two years later, supply-siders Arthur B. Laffer, Stephen Moore, and Peter J. Tanous wrote in their book, The End of Prosperity: How Higher Taxes Will Doom the Economy—If We Let It Happen: “The greatest supply-side economic success story of recent times (other than the Reagan Revolution) is the Irish Economic Miracle.”

On Second Thought

Oops.
By now, everyone in the global economy is aware that the Celtic Tiger has been declawed and the Irish Miracle a mirage.

 
Comment by Professor Bear
2010-11-22 23:48:36

If anyone thinks they understand what keeps the U.S. housing market from outright collapse, please share — I am sincerely curious!

‘Shadow inventory’ of 2.1 million homes may loom in U.S. market

By Alejandro Lazo, Los Angeles Times
November 23, 2010

A supply of 2.1 million homes poised for foreclosure or delinquency potentially looms over the nation’s housing market, according to data released Monday.

This “shadow inventory” of residential real estate — property that is in foreclosure, has a loan 90 days past due or has been taken back by a lender and is not yet listed for sale — stood at an eight-month supply at the end of August, according to Santa Ana mortgage research firm CoreLogic, which released the data. That was an increase from 1.9 million, a five-month supply, a year earlier.

The total number of U.S. properties listed for sale at the end of August plus the unlisted shadow inventory was 6.3 million, representing a 23-month supply of homes, according to CoreLogic, more than three times the amount considered healthy by economists. A year earlier, the total was 6.1 million, or a 17-month supply.

The weak demand for housing is significantly increasing the risk of further price declines in the housing market,” CoreLogic chief economist Mark Fleming said. “This is being exacerbated by a significant and growing shadow inventory that is likely to persist for some time.”

 
Comment by Professor Bear
2010-11-22 23:54:33

Up and Down Wall Street
TUESDAY, NOVEMBER 23, 2010
‘Shadow Inventories,’ a Dark Cloud Over Housing
By RANDALL W. FORSYTH | MORE ARTICLES BY AUTHOR

Despite record-low rates and low prices, the backlog of unsold homes grows. But loan servicers don’t mind.

WHAT’S TO BE DONE about America’s housing rot? The problem has defied solution, be it in record-low mortgage rates, government tax schemes or slashed pricing, in part because it keeps growing.

New housing starts already have been slashed to close to the slowest pace on record, an 11% drop in October to an annual rate of just over a half-million units. Yet, the inventory of available housing units continues to mount.

The number of homes on the market is readily apparent from all the brokers’ signs on your neighbors’ lawns. But that doesn’t tell the whole story.

The so-called shadow inventory of residential properties on the market jumped 10% in August, the most recent month for which data are available, to 2.1 million units, CoreLogic reported Monday. That’s roughly equal to the number of dreadful McMansions and condos with rotten Chinese drywall that builders were churning out annually at the peak of the boom. It’s also equal to about eight months’ of supply at the current pace of total sales.

CoreLogic, a provider of consumer and financial data and services, defines the shadow inventory as properties that are seriously delinquent (90 days or more), in foreclosure, and real estate owned by lenders that are not being offered through multiple-listing services. The latest month’s data represented an increase from 1.9 million units a year earlier, equal to five months’ supply.

The visible supply of properties listed was flat, at 4.2 million units, in August but because the slower pace of sales, this represented 15 months’ supply, up from 11 months’ a year earlier. All told, the visible and shadow supply totaled 6.3 million units, or 23 months’ supply at the current sales pace, up from 6.1 million a year earlier, or 17 months’ supply back then. In other words, we’re falling farther behind.

There is little reason to expect this excess supply to be cleared away any time soon. Steve Blitz, senior economist at ITG Investment Research, thinks existing-home sales ran at a 4.35 million annual rate in October (the data likely will have been reported by the time you read this), less than the 4.50 million consensus estimate. He looks for new-home sales bottoming at a 290,000 annual pace, versus a consensus forecast of 310,000.

Part of the problem in the housing market was the irrational exuberance of the youngest homebuyers, Blitz finds. “Demand in the past decade was fueled by too many who were too young to buy,” he writes, with the homeownership rate among 25-29-year olds jumping to over 40% at the peak in 2005 from 34% in the early 1990s.

Not until 2012 will the 25-34-year-old cohort — which is when people settle down, start families and buy a house — be big enough to start absorbing that supply. Of course, their empty-nester Boomer parents will want to dump their houses to cash out, in part to augment their diminished retirement accounts.

 
Comment by Professor Bear
2010-11-22 23:57:18

Seattle Real Estate News

Index: Seattle-area home prices fell 5.8 percent in September
Seattle has more than a year’s worth of distressed homes

The Seattle area has more than a year’s worth of distressed home inventory, but most big metropolitan areas are worse off, according to a new report.

CoreLogic calculates distressed supply by dividing the number of properties that are at least 90 days delinquent on their mortgages by the number of sales. These homes stand a good chance of ending up on the market as foreclosures or short sales — where a lender accepts less than the home is worth to avoid foreclosure — further straining the fragile housing market.

“The weak demand for housing is significantly increasing the risk of further price declines in the housing market,” CoreLogic Chief Economist Mark Fleming said in a news release. “This is being exacerbated by a significant and growing shadow inventory that is likely to persist for some time due to the highly extended time-to-liquidation that servicers are currently experiencing.”

King and Snohomish counties had 12.9 months worth of distressed homes in August. That was the 19th-lowest total out of the top 50 U.S. metro areas.

Comment by sleepless_near_seattle
2010-11-23 01:52:23

If we were on Facebook, under this post it would say, “sleepless likes this.”

 
 
Comment by Professor Bear
2010-11-23 00:00:16

Shadow inventory tsunami warning: REO inventory could end up as high as 7 million homes!

WSJ Blogs
Developments
Real estate news and analysis from The Wall Street Journal

* November 22, 2010, 9:36 AM ET

Shadow Inventory of Homes Rising

By Nick Timiraos

The “shadow inventory” of unlisted bank-owned homes and potential foreclosures increased to 2.1 million units in August, up 10% from one year earlier, according to new estimates from CoreLogic, a real-estate research firm.

That’s around eight months of supply, compared to a five-months’ supply one year ago.

By contrast, the inventory of all unsold homes listed for sale totaled 4.2 million units in August, unchanged from one year ago. Together, that means the visible and shadow supply of homes stood at around 6.3 million in August, or around 23 months of supply at the current sales pace.

Mark Fleming, chief economist at CoreLogic, says that weak housing demand “is significantly increasing the risk of further price declines in the housing market.” Delays in the foreclosure process, including those brought on by banks’ inability to file the proper legal paperwork, threaten to exacerbate that trend.

CoreLogic estimates that the shadow inventory is highest in the Miami metro area, at 33.5 months, followed by Long Island’s Nassau and Suffolk counties and the Chicago and Atlanta metro areas, with around 30 months. Florida, New York and Illinois require banks to process foreclosures through courts.

Some analysts have said the CoreLogic estimates look rather low. Laurie Goodman, senior managing director at Amherst Securities Group, has warned that as many as seven million homes could end up in banks hands unless more aggressive modification regimes are put in place.

 
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