Bits Bucket for April 20, 2011
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
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I had an idea for a way to change the tax code that I kind of wanted to get feedback on from the great minds here. Why would it or wouldn’t it work. The concept is very simple. Move the payment of income tax from the individual to the corporation to streamline the whole taxation process, and fix the rate across all business.
What do I mean? Currently, there are various tax rates at different income levels, then there are deductions, incentives, credits, and a whole slew of law surrounding all that, all so we can avoid having poor people be unfairly burdened by otherwise heavy taxes. I suggest instead we just have companies pay a simple payroll tax of 25-35% of all wages paid no matter the employee salary level, and at the same time leave the minimum wage intact. This would avoid the huge deductions that high income earners use to escape their taxes unfairly, and people at the minimum wage end of the scale would actually see their pay increase as the SSI, medicare, disability, and unemployment taxes are lifted from their paychecks.
At the same time, the rates would be no higher than current comparables, but corporations would be responsible for the accounting. We could save billions in tax preparation fees, IRS fees, individual audits, and legal costs for issues individuals currently have because of the tax code. So many conservatives claim that the private sector is more efficient, so let it be by allowing them to handle paying a single fixed tax for all their workers wages.
This tax would not be subject to the profitability of the company. It would have a moral and ethical basis in that if a company is utilizing the human capital of our nation, they contribute to the national welfare. It wouldn’t be regressive because companies would be paying the tax not individuals. It would free the general citizenry of the “oversight” of big brother, and instead focus the onus of tax reporting and accounting onto companies who are better able to budget and account for things like taxes. And it would provide an even keel for individuals to base their finances on.. what you earn is what you keep. There is no longer (individual) cheating on taxes because there is nothing to cheat, you keep everything you earn, end of story.
On the flip side of this, dividends paid by companies are also taxed at the same rate. If needed, the corporate income tax rate can be adjusted, and potentially, dividends could be deducted from profits. This *could* eliminate some of the complexity of S-corp vs C-Corp vs LLC, for the purposes of hiding/redirecting income for tax reasons.
As an example, suppose a company has revenue of 1 million dollars and the tax rate is 25%. There are 300k of expenses including COGS. 400k is paid in employee wages: say it’s 100k to CEO/owner, 50k to 2 managers/sales, and 25K to 8 shift workers. 100k is then due in “wage tax”, and every employee takes home their full salary with no extra paperwork, w-2 or 1099. 200K remains as “corporate profit”. The company chooses to distribute 100k of that as dividends. An additional 25K of dividend tax is incurred, leaving 75k in “profit” for the year. This 75k is then subject to the corporate income tax. Should the dividend not be distributed, then 200k of “corporate profit” is taxed. Finally, all capital gains taxes are set at 25% for consistency, and to prevent a need for shifting of money flow to capital gains instead of dividends, income/etc….
Of course, I see a huge problem with this system. It would eliminate the ability of special interests to get special favors by lobbying for tax code changes that are beneficial to them. On the other hand, if we truly want to promote a particular giveaway like solar energy funding, SSI, medicare, or federal grants, I see no reason why they couldn’t be part of a spending bill. Please let me know why this is the worst idea ever, or why it might have some small hope of working. If you have an idea for an improvement, I’m also all ears.
BTW, yes, this would eliminate the mortgage interest deduction because you would have no tax liability to deduct from. You would actually have no deductions because you would have no paperwork or liability. You would just keep the money you earned.. You would never worry about an audit. And if you are smart enough and fortunate enough to own a business, then you are better equipped to do tax accounting and paperwork than the average worker anyway, so the responsibility comes along with the power.
I like it but many special interest groups would fight it. Accountants would hate it since it will severly cut their business, mortgage and builders would hate it since deductions on home mortages would go away. Big capital would hate it since profits would finally be taxed at the same rate as labor…and the list goes on.
I also think it’s as good an idea as any. Like Mike said, special interests would fight it.
It would be best to make sure that ALL income is taxed at the same rate (which seems to be the case in your example). There is something inherently wrong when winnings from speculation (”investing”) are taxed at a lower rate than income earned from labor.
Or go with a VAT tax with a full repeal of the income tax.
Too regressive, too easy to push everything onto the black market, and not easy enough to control, IMHO.
Too regressive, too easy to push everything onto the black market, and not easy enough to control, IMHO.
Isn’t this what the utopias in western europe do? Do they have black market problems? (I don’t know…)
In the US we have a black market for labor rather than products because of the income tax system…is that better?
It’s not a bad idea, but
1. How would one handle companies who outsource?
2. The corporate taxes will just be passed onto as a lower salary to the workers, and probably as higher prices to the same workers, just to maintain the shareholders. The shareholders get to double dip while the workers are double slammed.
3. Is income from corporate taxes enough revenue to support the unemployed and other services?
4. Under the current political structure, this wouldn’t have a prayer of making into committee, much less to the floor of either House.
“4. Under the current political structure, this wouldn’t have a prayer of making into committee, much less to the floor of either House.”
Not a chance in hell.
“Move the payment of income tax from the individual to the corporation to streamline the whole taxation process, and fix the rate across all business.”
That’s a political non-starter with the top 1% who own the lion’s share of corporations (and who make far larger political donations than you or I do).
This is already done in countries like India.
Income tax is deducted at source.
Depending upon the basic income tax slabs (excluding other income like stocks property etc which indivual has to file)
Corporations deduct monthly 10-15% and during bonus/options grant time even more depending upon the total pay out to the indivual from the company according to tax slab.
On March 31,The indivual then pays extra tax direct to IRS if he has more income from other sorces (apart from salary)or claims refund if the company has deducted too much and paid IRS.
It is a flat tax. While I think your idea would extract more revenue from the wealthy than we currently get, the debate over whether the wealthy have a responsibility to carry a larger tax burden (in % of income) than everyone else is a legitimate one in my opinion. Noblesse oblige and all that.
If it’s a flat tax and the wealthy would pay more than they currently do, wouldn’t that be a step in the right direction as opposed to today where we say there should be a higher tax rate for the wealthy, then give them loopholes so they don’t actually pay?
The reason the extremely wealthy pay less tax is not that they get more deductions. That is the tiniest part of it. It is because they convert their income to capital gains. I don’t see a tax on capital gains in this proposal.
they convert their income to capital gains.
Convert? Or simply that their income IS capital gains? ie dividends, etc?
No, they convert it by taking the compensation they receive for doing their job in the form of stock options and other methods for buying stock at below market values. The tax code allows this, but it is still converting income received for doing their jobs - which regular people have to pay tax on at ordinary income rates - to capital gains.
Wouldn’t a matching or slightly greater capital gains tax fix this also?
You need all types of income to have the same marginal rate of tax: ordinary (earned) income, dividends, interest and cap gains. The cap gains still come out ahead because you can offset the cap gains with cap loses, but that could be further restricted or eliminated. The only real rule with cap gains is that you need to exclude the return of basis. You don’t *have* to allow negative numbers in that process.
are’nt you assuming that all people work for corporations?
Sounds like a proposal for government employees to pay no taxes…
If government employee wages are set correctly, shouldn’t matter. Taxes pay for public employees, so it is inefficient for public employees to pay income taxes. Drop wages by %50 or whatever and save the paperwork.
If government employee wages are set correctly, shouldn’t matter. Taxes pay for public employees, so it is inefficient for public employees to pay income taxes.
+1 when you’re considering the only taxing authority is the one they work for.
However, when you consider the federal employees that work in a state with an income tax, there’s a wealth re-distribution effect at play as well.
It also removes from federal employees, at least, the responsibility of participating in the same burdens of citizenship that other citizens bear. I think that is wrong, even if the issue is just filling out a form. There are proposals currently in Congress to immediately fire federal employees who are significantly behind on their taxes. I suppose there needs to be some provision for people who got there through no fault of their own (I believe the advancement of the concept of innocent spouse relief has reduced this problem a lot, but it was a fairly large issue in the past) and are agressively trying to remedy it, but this is a good idea. Working for the government is a priviledge. It should come with additional responsibility, not less. And understanding the burdens put on other citizens is an important lesson.
“Drop wages by %50 or whatever and save the paperwork.”
The problem with that idea is that then the government would only be able to attract workers who don’t know on which side of a number to put the percentage sign…
There are proposals currently in Congress to immediately fire federal employees who are significantly behind on their taxes.
Thanks for mentioning this. That’d be great to see, but of course it’s left with all kinds of wiggle room if the law really says “significantly”.
I’d argue that those who work for the “state” should be held to a higher standard, but recently I’d settle for simply having them held to the same standard as the rest of us. (cough TTT cough)
who don’t know on which side of a number to put the percentage sign…
zing!
Working for the government is a priviledge. It should come with additional responsibility, not less. And understanding the burdens put on other citizens is an important lesson.
This is something that was drummed into me from an early age. Via my military veteran father and my mother, who was a public school teacher, and, before that, an employee of the U.S. Geological Survey and the VA.
Polly,
If you released everyone(individuals) from the federal income tax, then federal workers would have the same citizenship burden as the regular guy. Since you move the burden to the employer level, you could argue that the gov’t would have to be responsible to pay itself… and you could simply eliminate the inefficiency of that entire circular paper/money shuffle. Wages would still be equivalent or nearly so.
It looked to me like the thread was talking about the current system, not your system at this particular place. If no one files taxes at all, of course, the burden is the same.
“(cough TTT cough)”
I assume that as Treasury Secretary, TTT is fully exempt from the tax laws which apply to all the little people who work for Uncle Sam?
your idea is basically a “flat” tax…which alot of people are in favor of.
wheter i pay it or a company (that happens pretty much already through the WH rules) is irrelevant.
Love the idea of a flat tax as it eliminates a lot of accountants, lawyers, etc. Simple is good.
So how then to preserve the “progressive” nature of our system? Generous social benefits for the poorest citizens. A sliding payment scale for those with more.
It really doesn’t change the picture on lawyers and accountant except the ones that play games in the deductions and credits of the middle class. It does nothing to address the complexity of calculating taxable corporate profits or the conversion of ordinary income to long term capital gains. That is where the big kids play
This is a big reason why I think setting the capital gains taxes slightly above the dividends taxes will push companies back into paying dividends. And any retained earnings should be subject to an additional tax of perhaps 10% so companies could grow, but it would be more efficient to pay out dividends when possible.
C-Corporations get no favorable capital gains rate…but polly is correct with respect to the need for tax accountants to compute taxable income.
9 Things The Rich Don’t Want You To Know About Taxes
….The 2004 American Jobs Creation Act, which passed with bipartisan support, allowed more than 800 companies to bring profits that were untaxed but overseas back to the United States. Instead of paying the usual 35 percent tax, the companies paid just 5.25 percent.
The companies said bringing the money home — “repatriating” it, they called it — would mean lots of jobs. Sen. John Ensign, the Nevada Republican, put the figure at 660,000 new jobs.
Pfizer, the drug company, was the biggest beneficiary. It brought home $37 billion, saving $11 billion in taxes. Almost immediately, it started firing people. Since the law took effect, it has let 40,000 workers go. In all, it appears that at least 100,000 jobs were destroyed.
Now Congressional Republicans and some Democrats are gearing up again to pass another tax holiday, promoting a new Jobs Creation Act. It would affect 10 times as much money as the 2004 law….
http://www.altweeklies.com/aan/9-things-the-rich-dont-want-you-to-know-about-taxes/Story?oid=3971382
Yeah but how many jobs did it save?
hah!
I have to admit that was pretty good.
There was nothing wrong with that except it was Americans living in America……
Repatriating the money should be coupled by mandatory spending in America and hiring Americans not H1b ’s or people on visas
Can’t apple make the i-pads in Indiana?
. Almost immediately, it started firing people.
Please let me know why this is the worst idea ever, or why it might have some small hope of working. If you have an idea for an improvement, I’m also all ears.
It has some good aspects but it would need to be tweaked to be a progressive tax because that’s what the vast majority of Americans want and have wanted for over 100 years. Americans want the rich to pay a higher percentage of their income and wealth in taxes than the rest of us. This is not an opinion but a fact proven by a history of countless polls, studies and legislation.
Just a recent sample with some irrefutable numbers:
The NBC/WSJ poll also lists 26 different ways to reduce the federal budget deficit. The most popular: placing a surtax on federal income taxes for those who make more than $1 million per year (81% said that was acceptable) source: online dot wsj dot com 3/3/11
(The fifth most popular was phasing out the Bush tax cuts for those making over $250,000 a year (68 percent).)
It would be progressive. Those that own companies would be required to pay dividend tax on earnings, plus the corporate tax on profits. As their percentage ownership increased, their tax would also increase.
Interesting. What about the self-employed?
I think the goal is to shift the entire cost of government to wage slaves, so the rich and powerful — executives getting capital gains and public employees with retirement income — pay nothing.
Actually, I would have no problems setting the capital gains taxes slightly higher than the dividends taxes to encourage dividend payout rather than fueling capital appreciation…
Can cap gains taxes be set a bit higher than earned income? That way, we could encourage *work and productivity* over gambling and speculation.
I’m going to think about this a bit more.
Just curious. You are making dividends deductible? They are not under the current corporate tax system. Dividends are paid out of profits (this is an accounting requirement, once current and accrued profits are used up, the next dollar is return of capital) by definition and therefore cannot be deducted from profits.
First impressions:
You are effectively raising the minimum wage by quite a bit. Right now the company’s cost of hiring a minimum wage employee is wage plus employer half of SS and medicare plus unemployment and a few bits and pieces. Your proposal cranks up that cost a lot. People here complain that the employer portion of SS is really part of their salary because the company was willing to pay that much to hire them. Despite you calling it a tax on the company, this is the exact same thing.
The increase is going to put tremendous pressure on companies to outsource minimum wage jobs. This could be to other countries, but it could just be to independent contracting. There are rules about what constitutes an independent contractor and most minimum wage employees can’t begin to fulfill those rules. That doesn’t mean that companies won’t tell their poorly paid employees to take the switch or leave and that they won’t be too scared to complain. So, even more people getting dumped into the vaguaries of the individual health insurance world - unless you are proposing a single payor health plan as part of your reform.
The incentive to turn everyone (not just minimum wage) into an independent contractor will be huge. See above.
On this board, Arizona Slim is the perfect example of an independent contractor. She bids on a job. She get the job. She delivers the product for the price agreed to and does it at the times and in the locations of her choosing as long as the final delivery date is met. If she needs help with part of the work, she hires a subcontractor. If the work turns out to be way harder than she realized, she still has to deliver and can “lose” money on the deal (assuming she wouldn’t normally take a job that works out to less than $x per hour). Or, if she just gets in the zone and cranks it out very quickly, she could “make” money over and above what she would normally want to get as an hourly rate. Anyone working at a particular place and a particular time using employer dictated procedures and for an hourly rate is not an independent contractor under the law.
More later.
I actually thought very hard about the minimum wage problem when coming up with this… If you outsource, wages paid to the outsourcees must still be minimum wage, and the outsourcing company must still page the wage tax.. There is no way around it, and it would therefore be more efficient to just not outsource (in country). Out of country outsourcing is the biggest problem I could see, along with importing of goods. However, I think that is a whole problem in itself that needs to be tackled. Our country currently has strong environmental and human rights protections that are trampled in other countries for the profit of corporations… I do think tariffs can help even the playing field for US companies who follow the rules that are in place for good reason.
What makes you think that all outsourced jobs will be with a corporate outsourcer? It will just be Joe, agreeing to do X task (which by its nature must take 8 hours) for $y. Are you going to prevent people from taking work as independent contractors at a rate which prevents them from keeping the minimum wage amount for the number of hours worked? That is way more intrusive than the current labor laws of our country. Way more.
Can’t companies already do that? Why doesn’t it happen already? Maybe it does, but it’s just not that big of a problem?
They don’t bother because the gain is too small and the risk of getting caught is too high. If you increase the cost of very low wage workers by 25%, that will change quickly.
Most European countries already have tax deducted by their employer, called PAYE or Pay As You Earn. The tax department tells the company how much to charge; 20% of the first $5,000 then 25% on the next 4,000 or whatever. So what you get at the end of the month is all yours and the employees don’t need to file any tax return.
Under your plan, every job that can be done out of the US will be done outside the US. The giant sucking sound will be far greater than that created by NAFTA.
I don’t disagree that this would tend to push jobs away to avoid tax, but we have a congress to create law to stop tax avoidance don’t we?
And how’s that working out?
I think with a simplified tax code it would work out rather well. The original congress seemed pretty capable of handling tariffs and not imposing a direct income tax on people’s wages… Also, I think if companies were cheating by offshoring, rather than a bunch of individuals trying to make a difference, you would have corporations battling each other to not let one get an advantage over the other. To me that’s better than corporations battling against me or you as individuals.
Tax ALL goods manufactured overseas at 100% of retail. China would hate this. Walmart would hate this, but think about it it might even keep some jobs here, and so junk we don’t need would double in price, wages would increase and things we need are mostly made or serviced here.
I don’t know the exact rate, but yeah, if a country is avoiding minimum wage laws, environmental controls, and human rights conditions, their product should either not be imported, or a high tariff should be imposed on it. We do this with Cuban cigars don’t we?
“We do this with Cuban cigars don’t we?”
not for that reason.
Agree that we should engage in “fair trade,” not “free trade.”
As we’ve seen, the only thing we get with “free trade” is wage arbitrage, which leads to a loss of good-paying jobs, and increases pollution as the “developing nations” tend to build junk that breaks down sooner and cannot easily be repaired. We get more pollution on the production side, and more pollution on the end-of-cycle side (dumping the trash).
We used to build things that might have initially cost more, but they lasted longer, which (IMHO) ended up being more affordable to the consumer *over time* as they didn’t need to replace their stuff every few months or years.
They move it to the corporation, they work against your IRA and 401k.
I do not urinate in my own beer.
I must say these fed guys say some very profound things…
Fed’s Fisher expects to advocate tightening later
ATLANTA (Reuters) – The President of the Dallas Federal Reserve Bank Richard Fisher said on Monday he expected to be at the front of the pack in pressing for monetary policy tightening at an appropriate time.
“I fully expect I will be at the front of the pack for advocating for tightening but you don’t tighten until you have stopped loosening and we are still in the loosening process,” Fisher told reporters.
“I still think we have a self sustaining recovery but I expect to have some moments of hesitancy and that may well have occurred in the first quarter,” Fisher said.
Guy sounds like he is right on top of it.
He is indeed. Had the privilege of meeting him when he spoke at the University of Arizona business school last year. A very sharp cookie.
They will tighten for about 5 minutes, then after the economy starts to seriously croak again…
Sales of Existing Homes in U.S. Probably Increased in March
By Timothy R. Homan - Apr 20, 2011 12:00 AM ET
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Sales of Existing Homes in U.S. Probably Increased in March
Housing may remain a weak link in the economic recovery that began in June.
April 19 (Bloomberg) — Patrick Newport, an economist with IHS Global Insight, talks about U.S. housing market conditions. Housing starts gained in March, as work began on 549,000 houses at an annual pace, up 7.2 percent from the prior month, figures from the Commerce Department showed today in Washington.
A gain in U.S. sales of existing homes during March probably failed to make up for a drop the previous month, a sign that the housing market is struggling to rebound, economists said before a report today.
Purchases rose 2.5 percent to a 5 million annual rate after dropping 9.6 percent in February, according to the median forecast of 74 economists surveyed by Bloomberg News. Sales in January of existing homes, which make up 90 percent of the market, climbed to the highest level in eight months as buyers used all-cash transactions to obtain distressed properties.
Housing may remain a weak link in the economic recovery that began in June 2009 as unemployment, falling property values and stricter loan rules push foreclosures to record levels. At the same time, a drop in prices has made houses more affordable, a sign demand may not fall much more.
“We’re on a recovery track, it’s just going to be slower than we would all like,” said Robert Dye, a senior economist at PNC Financial Services Group Inc. in Pittsburgh. “Credit constraints are working against home sales right now. By the end of this year, we’ll start to feel like we’ve turned a corner.”
A point can be made that the the so-called “corner” he speaks of is actually the edge of a cliff, where the motion turns from horizontal to vertical downward.
This is how real squatters do it:
http://www.news-journalonline.com/news/local/east-volusia/2011/04/20/legislators-seek-fix-to-laws-allowing-squatters-to-take-property.html
I don’t know how things work in Florida, but here you’d have to maintain the “abandoned” property for twenty years to have any kind of claim. Simply moving in might get you a free roof over your head for a while, but that’s about it. I suppose you’d have to pay taxes too, because if they aren’t paid, the state would auction the tax receipts after 1-3 years. The purchaser (if not paid back) would be able to take complete possession of the property within about a year after buying the tax receipt.
The courts here have ruled against these squatters time and time again. What’s worse is when they try to rent the properties to unsuspecting tenants.
Every state is different. It takes only 5 years here, but the squatter has to prove certain elements. For example the owner must have been aware of the squatting, or at least should have been aware etc.
Another reason why those who choose to stay-and-not-pay benifits the banks over the ones who choose to simply walk away.
A stay-and-not-payer will keep the house occupied all the way up to the very day the banks chooses to boot him out. A squatter who moves into an abandoned house has some legal machinery working in his favor that the bank may have to contend with.
Realtors Are Liars
RAL - you could proabably just get by with that. pretty sure it would fly with all of us.
Nah…. most of all, you don’t like it so I’ll say it again…..
Realtors Are Liars
These lying realtors interest me. Please subscribe me to your newsletter.
Done.;)
~Realtors Are Liars
Wonder why the neighbor, who installs blinds for home depot, uses the HOA trash service to his advantage by piling all his waste(packaging materials, cardboard, etc) for free?
These dumpsters are for residential use and are not intended for independant contracters to use for their own benefit! But,
He is married to a realtor!
I rent to a realtor….Yikes! Will I have to fumigate when she leaves?
Not really. I have no use for Realtors myself. You just come across as a bit of a douchebag.
When a realtor magically makes up another offer to pressure a buyer, is it truly magic(which relies on deceiving an audience)….or just basic douchebaggery?
Living in your head….. rent free.
wtf?? bunch of dorks…
Late to The Party…Once Again. ~ Peter Schiff Apr 19, 2011
The only thing more ridiculous than S&P’s too little too late semi-downgrade of U.S. sovereign debt was the market’s severe reaction to the announcement. Has S&P really added anything to the debate that wasn’t already widely known? In any event, S&P’s statement amounts to a wake up call to anyone who has somehow managed to sleepwalk through the unprecedented debt explosion of the last few years.
Given S&P’s concerns that Congress will fail to address its long-term fiscal problems, on what basis can it conclude that the U.S. deserves its AAA credit rating? The highest possible rating should be reserved for fiscally responsible nations where the fiscal outlook is crystal clear. If S&P has genuine concerns that the U.S. will not deal with its out of control deficits, the AAA rating should be reduced right now.
By its own admission, S&P is unsure whether Congress will take the necessary steps to get America’s fiscal house in order. Given that uncertainty, it should immediately reduce its rating on U.S. sovereign debt several notches below AAA. Then if the U.S. does get its fiscal house in order, the AAA rating could be restored. If on the other hand, the situation deteriorates, additional downgrades would be in order.
AAA is the highest rating S&P can give. It is the Wall Street equivalent to a “strong buy.” If a stock analyst has serious concerns that a company may go bankrupt, would he maintain a “strong buy” on the assumption that there was still a possibility that bankruptcy could be averted? If the company declared bankruptcy, would the analyst reduce his rating from “strong buy” to “accumulate”?
In truth, if bankruptcy is even possible, the rating should be reduced to “hold,” at best. Only if the outlook improves to the point where bankruptcy is out of the picture should a stock be upgraded to “buy.” A “hold” rating would at least send the message to potential buyers that problems loom. Then if the company does declare bankruptcy, at least it does not do so sporting a “buy” rating.
Of course, by shifting to a negative outlook, S&P will try to have its cake and eat it too. In the unlikely event that Congress does act responsibly to restore fiscal prudence, its AAA would be validated. If on the other hand, out of control deficits lead to outright default or hyperinflation, it will hang its hat on the timely warning of its negative outlook. This is like a stock analyst putting a strong buy on a stock, but qualifying the rating as being speculative.
The bottom line is that the AAA rating on U.S. sovereign debt is pure politics. S&P simply does not have the integrity to honestly rate U.S. debt. It has too cozy a relationship with the U.S. government and Wall Street to threaten the status quo. In fact, given the culpability of the rating agencies in the financial crisis, it may well be a quid pro quo that as long as the U.S.’ AAA rating is maintained, the rating agencies will continue to enjoy their government sanctioned monopolies, and that no criminal or civil charges will be filed related to inappropriately rated mortgage-backed securities.
Remember S&P had investment grade, AAA, ratings on countless mortgage-backed securities right up until the moment the paper became worthless. Amazingly, the rating agencies somehow maintained their status, and their ability to move markets, after the dust settled.
Currently, they are making the same mistake with U.S. Treasuries. Once it becomes obvious to everyone that the U.S. will either default on its debt or inflate its obligations away, S&P might downgrade treasuries to AA+. Such a move will be of little comfort to those investors left holding the bag.
In its analysis of U.S. solvency, S&P typically factors in the government’s ability to print its way out of any fiscal jam. As a result, it applies a very different set of criteria in its analysis of investment risk than it would for a private company, or even a government whose currency has no reserve status. But the agency completely fails to consider how reckless printing will impact the value of the dollar itself. It can assure investors that they will be repaid, but the agency doesn’t spare a thought about what if anything our creditors may be able to buy with their dollars.
Again, S and P does little to inform investors in fact it has misinformed investors regarding MBS. It is a tool of the Banking Titans. To fleece investors, to push policy. Look at all the PIIGS. These rating agencies always come in with a downgrade when the gov’s don’t do what the world banking community wants them to. Where the F were they when this debt bubble was forming. No where. Look at the US ,where was the S and P when the bubble was forming. My guess is that the financial elite want to influence legislation regarding spending. I saw another poster who suggested that there was an ongoing investigation of the rating agencies and this was done to influence that.
Let’s remix that old E.F. Hutton slogan to say:
When S&P talks, don’t listen.
Jury convicts exec in $3B mortgage fraud case
AP
ALEXANDRIA, Va. – A jury on Tuesday convicted the majority owner of what had been one of the nation’s largest mortgage companies on all 14 counts in a $2.9 billion fraud trial that officials have said is one of the most significant prosecutions to arise from the nation’s financial crisis.
Prosecutors said Lee Farkas led a fraud scheme of staggering proportions for roughly eight years as chairman of Florida-based Taylor Bean & Whitaker. The fraud not only caused the company’s 2009 collapse and put its 2,000 employees out of work, but also contributed to the collapse of Alabama-based Colonial Bank, the sixth-largest bank failure in U.S. history.
The jury returned its verdict late Tuesday after more than a full day of deliberations.
Colonial and two other major banks — Deutsche Bank and BNP Paribas — were collectively cheated out of nearly $3 billion, prosecutors estimated. Farkas and his cohorts — six of whom entered guilty pleas to related charges and testified against him at the two-week trial in U.S. District Court — also tried to fraudulently obtain more than $500 million in taxpayer-funded relief from the government’s bank bailout program, the Troubled Asset Relief Program (TARP).
While TARP at one point gave conditional approval to a payment of roughly $550 million, ultimately neither Taylor Bean nor Colonial received any TARP money, and investigators from that office, along with the FBI and other agencies, helped uncover the fraud.
Neil Barofsky, who recently resigned as TARP’s special inspector general, has called the Farkas case “the most significant criminal prosecution to date rising out of the financial crisis.”
In a conference call Tuesday evening with reporters, the Justice Department’s criminal division chief, Lanny Breuer, said Farkas was “one of the masterminds in one of the largest bank frauds in history” and that his misconduct “poured fuel on the fire of the financial crisis.”
“TBW was a major, major player in this industry,” perhaps the second largest in the country depending on how it is measured, Breuer said.
Farkas testified in his own defense at the trial and claimed he did nothing wrong. He claimed he was unfamiliar with details or knowledge of many aspects of the various fraud schemes, testimony prosecutors derided as incredible in their closing arguments.
Farkas’ lawyer, Bruce Rogow, said the six executives at Colonial and Taylor Bean who struck plea deals skewed their testimony to bolster the government’s case in the hope of receiving lighter prison sentences for their cooperation. Rogow said Farkas and everyone else at Taylor Bean was working honestly and ethically to get control of its finances and perhaps could have done the job if the government hadn’t essentially shut the company down when it raided company headquarters in 2009.
Rogow said late Tuesday he was disappointed in the verdict and plans to appeal.
“I had hoped the jury would have accepted our argument that the six people who pled guilty did so not because they felt they were guilty but because they wanted to minimize the sentences that the government threatened them with,” Rogow said.
U.S. District Judge Leonie Brinkema ordered marshals to take Farkas into custody immediately following the verdict, a relatively unusual step since most defendants are allowed to remain free until they are formally sentenced. Farkas will be sentenced July 1 and potentially could spend the rest of his life in prison.
According to prosecutors, the fraud began in 2002, when Taylor Bean overdrew its main account with Colonial by several million dollars. Mid-level executives at Colonial agreed to transfer money into Taylor Bean’s accounts at the end of each day to avoid generating overdraft notices, a process known as “sweeping.”
As the hole grew to well over $100 million, Taylor Bean and a handful of Colonial executives concocted a scheme in which Taylor Bean sold hundreds of millions in worthless mortgages to Colonial, mortgages that had already been sold to other investors. More than $1 billion in such phony mortgages were eventually sold to Colonial, which listed them on its books and on its quarterly reports as legitimate assets, prosecutors alleged.
In a related scheme, Taylor Bean created a subsidiary called Ocala Funding that sold commercial paper — essentially glorified IOUs — to banks including Deutsche Bank and BNP Paribas. But prosecutors said the collateral that supposedly backed that commercial paper was worthless, and when Taylor Bean collapsed in 2009, the two banks lost roughly $1.5 billion.
Prosecutors said Farkas was motivated by greed and a lavish lifestyle that included a private jet, a seaplane, numerous houses including a home on Key West that he paid servants to hand wash with a sponge to prevent salt damage, a collection of several dozen classic cars and an executive dining room at company headquarters that served pheasant and caviar.
Farkas, 58, was charged with 14 counts of bank fraud, wire fraud, securities fraud and conspiracy.
Trial testimony revealed that the bankers at Colonial who worked with Farkas felt trapped as the hole in Taylor Bean’s accounts grew exponentially. Cathie Kissick, a vice president at Colonial who did not tell her superiors about the vast majority of Taylor Bean’s problems, testified that she had little leverage over Farkas because of the trouble she would be in if the size of the hole in Taylor Bean’s accounts was discovered.
Farkas exploited that leverage, telling a colleague: “If I owe you $100, I have a problem. If I owe you $1 million, you have a problem.”
Farkas exploited that leverage, telling a colleague: “If I owe you $100, I have a problem. If I owe you $1 million, you have a problem.”
Sounds like encroachment on Trump’s turf.
Farkas…wonder if he is related to Scott Farkas.
Little Farkas?
His only mistake was crossing Deutsche Bank.
Meet the Farkas.
As I’ve been saying, they are going to get around to most of the crooks eventually, but there was so much fraud out there that it’s going to take time to get to it all.
Just can’t get this conversation out of my head. It was overheard as I waited in a physician’s office. The receptionist was talking with her friend who was a commerical realtor who just got her residential license:
Receptionist: How’s everything going w/your new job?
Realtor: Well, it’s really different. Commercial is so much easier with less parties that need to come together. (Not sure what she meant by this. At the time I assumed she meant the funding.)
Receptionist: But are you enjoying working with the public?
Realtor: (Rolling eyes) Actually the sellers are driving me nuts. Everyone thinks they’re selling the Taj Mahal. And some of these houses really need a lot of work.
******************************************
I’m telling ya. White collar boomer professionals in CNY believe we’re coming out of a cyclical recession. My financial planner friend listened patiently to some of my hbb ramblings for a while but has basically shut me off as some loon. I experienced this before in 2008 when I shared some ideas w/people I cared about. There is so much more coverage on the MSM you’d think some of our ideas would gain credence but the resistance is just as stubborn in some circles as its ever been. When CNY numbers didn’t sink like a stone in the last few yeaars as they did in other areas, the concept of “it’s different here” gained traction.
I stopped talking about HBB perspectives to most others several years ago, as I figured out that most San Diegans can’t handle the truth.
Complete opposite for me. I no longer catch flack for repeating things I read here to fam and friends. They used to accuse me of being a “doomer”, but now I get silence.
Silence is golden.
I’m telling ya. White collar boomer professionals in CNY believe we’re coming out of a cyclical recession. My financial planner friend listened patiently to some of my hbb ramblings for a while but has basically shut me off as some loon. I experienced this before in 2008 when I shared some ideas w/people I cared about. There is so much more coverage on the MSM you’d think some of our ideas would gain credence but the resistance is just as stubborn in some circles as its ever been. When CNY numbers didn’t sink like a stone in the last few yeaars as they did in other areas, the concept of “it’s different here” gained traction.
——————–
It’s the same thing here, CarrieAnn. Everyone is “really glad that the recession is over,” out here in San Diego. Housing prices in the bad areas have fallen hard, but the mid and higher-end areas have not even budged in some cases.
Yeah, “it’s different here.”
Last fall I almost got into an argument with some old fogie technical experts at dinner. They were convinced that this was a cyclical recession like before and that things would come back around. I tried to talk on their terms, saying: “That was true in a closed system, but it’s no longer a closed system. Instead of the same jobs and people just moving around within the existing system, you’re just seeing jobs bleed out of the system and to other countries.” These extremely smart guys simply didn’t believe me. They still remember the days when “layoff” meant that you took unemployment for a few weeks until the company called you back.
I got into a somewhat heated roundabout recently with someone who proclaimed The Bernanke was a genius and that Paul Krugman should be listened to when he says the Fed needs more shock and awe money supply expansion. Once you realize you’re arguing w/one of those disciples you might as well pick up your bat and ball and head home. I could’t help but notice when I asked him what his end game was for that situation, he simply moved the argument in a different direction which once more put the focus on the short term. He neglected my question competely although I repeated it at least several times.
This gentleman, at one point in his career, has been an advisor to our government.
“…the Fed needs more shock and awe money supply expansion.”
Response: Just how much stagflation is enough for you?
Al, I brought up the seniors on fixed income whose savings will be devalued moving them toward poverty. He sells himself as a dyed in the wool liberal but his response to the seniors’ problem was in fact chilling. I guess he sees them as collateral damage. No, there was something more. The bitterness of his response had the whiff of disgust or revenge.
It was a weired conversation. I wasn’t that invested in it. Just throwing out all the arguments that become almost automatic after reading this stuff for so long. He was ready to spit.
The liberal “end game” to this situation is that q. easing is simply to spread the pain over many years. For ailing
banks, you give them a credit card and hope they pay a little more than the minimum payment.
The spending half comes in when the government spends money to create jobs — hopefully permanent non-outsourceable jobs. Yes, it may cost lots of money per job, but if somebody can make $50K for 15 years or so and pay taxes on that, it can make up for the initial borrowing. And that $50K person can buy a house which will help out the bank.
At least that’s the ideal. Will it ever work? My guess says no. Government job programs too often turn into public-private partnerships which introduce waste and middlemen. There is almost no such thing as an unoutsourceable job, so those jobs aren’t likely to last (internet jobs were outsourced very quickly.) Generally it costs more to create a job than the job will generate in taxes. And the banks are too deep in doo-doo to ever pay back that credit card bill.
“They still remember the days when “layoff” meant that you took unemployment for a few weeks until the company called you back.”
Jeepers! That was a looooooooong time ago, as in decades.
Many, many people are still stuck decades behind.
My favorite is that no one forces people to take crappy jobs.
I think the problem is that a lot of our policy makers (and their advisors) are either in positions/jobs that are pretty secure, or they are older, and think in terms of “how things used to be.”
You guys are totally right — things are different with modern-day globalization, and there is no getting away from that fact. We have to deal with what ails us TODAY, but nobody is willing to tackle the big issues.
One interesting note is how Trump has surged in popularity, largely (IMO) because he’s willing to talk about outsourcing as one of our main problems.
NY and DC are fantasy land that’s where all the printed / FED dollars are going.
Very true.
It was overheard as I waited in a physician’s office.
Interesting story but the part that got me was….you got to see a doctor?
You must have insurance that actually still pays part of that kind of stuff.
That’s pretty lucky for an American these days.
93%
That’s the percentage of Americans who suffered severe illness who were satisfied with their health care.
Source: ABC News, USA Today, Kaiser Family Foundation. Hardly the right wing conspiracy.
25% (be proud, cuz you’re exceptional)
A 2003 Gallup poll found only 25% of Americans are either “very” or “somewhat” satisfied with “the availability of affordable healthcare in the nation”, versus 50% of those in the UK and 57% of Canadians. Those “very dissatisfied” made up 44% of Americans, 25% of respondents of Britons, and 17% of Canadians.
A 2009 Harris/Decima poll found 82% of Canadians preferred their healthcare system to the one in the United States, more than ten times as many as the 8% stating a preference for a US-style health care system for Canada[8] while a Strategic Counsel survey in 2008 found 91% of Canadians preferring their healthcare system to that of the U.S.[9][10] In the same poll, when asked “overall the Canadian health care system was performing very well, fairly well, not very well or not at all?” 70% of Canadians rated their system as working either “well” or “very well”. wiki
76%
(I’m glad our politicians listen to the will of the people)
June 2009 NBC/Wall Street Journal
the American public overwhelmingly favors a choice between getting insurance coverage either through the private market or a government run option. Indeed, 76 percent of respondents said it was either “extremely” or “quite” important to “give people a choice of both a public plan administered by the federal government and a private plan for their health insurance.”
What do the Canadians know about the US health care system? What about the 30% who don’t think their system is working well or very well?
What do the Canadians know about the US health care system?
idk….
Maybe that it sucks?
We have a public option for home insurance here in Florida. It’s broke and getting them to pay claims is like pulling teeth. They’re also exempt from our bad faith laws which means they have no incentive for them to fairly adjust claims…and I’m not going to get into the assessments that are on every single property insurance policy in the state to pay for their irresponsibility. That’s exactly what I want from my health care too.
78%
What about the 30% who don’t think their system is working well or very well?
I know. And what about the 22% who are satisfied with USA’s healthcare costs?
ABCNEWS/Washington Post poll, Americans by a 2-1 margin, 62-32 percent, prefer a universal health insurance program over the current employer-based system….
Support for change is based largely on unease with the current system’s costs. Seventy-eight percent are dissatisfied with the cost of the nation’s health care system, including 54 percent “very” dissatisfied.
Imagine how dissatisfied they’ll be when they find out that the government pays more. So if traditional plans are part of the “public option” and the government pays $20,000 for a procedure vs. $10,000 at Blue Cross someone with a 20% co-pay will pay $4,000 for the public option compared to $2,000 at Blue Cross.
Of course it’s entirely possible that the public options becomes the only option with no co-pays or out of pocket expenses at the time of service. Where do you think the money will come from then? Oh, that’s right…taxes…or borrowing.
And while we’re at it, why don’t you compare the cancer mortality rate of the US to Europe and Canada. Please, do the research on your own and report your conclusions.
I’m happy with my health care. It could be more affordable, but that doesn’t have much to do with the quality of care I am receiving.
Dr. did an exceptional job on my wife’s c-section. It was easy to make appointments, and they were never running late.
I looked up a dr in my UnitedHealthcare site at 9:30am, and had an appointment at 11:30.
Took the kid to an Urgent Care Center at 10:30pm at night, and she was seen by a competent staff in a reasonable time, and was home by 11:30pm.
FWIW, I know sooo many people who don’t go to the doctor because they are either uninsured or or have a crappy HD plan that its simply mind boggling. I’m guessing that the uninsured don’t have access to those state of the art cancer treatments either, and we’ll soon be adding the medicaid crowd to that august group.
As for outcomes, studies do show that as a group most Europeans get better health care than Americans. Now if we only compare a subset of Americans, those who are wealthy or are lucky enough to still have decent insurance, then maayyybeee the US comes out ahead. But the problem is that group is shrinking fast. I know I used to be in it, but now I’m stuck with a crappy HD plan.
I simply would like you to compare something simple, the cancer mortality rate in the US as compared to Canada. The mortality rate factors EVERYONE regardless of access to health care.
Imagine how dissatisfied they’ll be when they find out that the government pays more.
Imagine? I never really liked that song… but……
Why would the public-option pay more? Let’s look at our public Medicare costs inflation vs private.
Here’s the raw fact, from the National Health Expenditure data: since 1970 Medicare costs per beneficiary have risen at an annual rate of 8.8% — but insurance premiums have risen at an annual rate of 9.9%. The rise in Medicare costs is just part of the overall rise in health care spending. And in fact Medicare spending has lagged private spending: if insurance premiums had risen “only” as much as Medicare spending, they’d be 1/3 lower than they are. NYT
And if the public option did pay more, maybe you should look up the word option in the dictionary.
compare the cancer mortality rate of the US to Europe and Canada.
OK: Cuba, Italy and Japan beat us and we’re about the same as Canada and Germany. (And we spend twice as much)
Cancer mortality rates, 2004 (per 100,000 population)
Canada: 135
Cuba: 131
Germany: 135
Italy: 132
Japan: 120
USA: 133 source: WHO World Health Statistics 2009.
We do a fine job with cancer (mostly if you have insurance). But 50 million Americans don’t have insurance and 50 million have junk insurance. But cancer is not the only thing people get and that hobbles and kills them. Other countries beat us in many other categories. And in westernized countries with universal healthcare the people live longer than Americans and have much healthier children.
U.S. has second worst newborn death rate in modern world, report says CNN dot com
The World Health Organization’s ranking
of the world’s health systems.
#1 France
………..
……….
#37 USA (YEA!!!!! Google: youtube we’re number 37)
BAD ANDY says “Imagine how dissatisfied they’ll be when they find out that the government pays more. So if traditional plans are part of the “public option” and the government pays $20,000 for a procedure vs. $10,000 at Blue Cross someone with a 20% co-pay will pay $4,000 for the public option compared to $2,000 at Blue Cross.”
This is pure BS with the excepeption of the Medicare Prescription Drug plan which I believe was pushed through to bankrupt the system. I’d say most insurance companies use Medicare as a guide to what they will pay.
Again Medicare advantage plan which is a privately run form of medicare costs 15-20% more per patient than Medicare. There is absolutely NO WAY this would be true if private insurance was paying 50% less for procedures. Bad Andy you need to post something to back up your assertion that Medicare on average pays 100% more than private insurance for procedures. It’s pure BS. You may find an example but on average they don’t pay more. In fact many doctors don’t accept medicare patients because of their lower payments.
WASHINGTON — The number of doctors refusing new Medicare patients because of low government payment rates is setting a new high, just six months before millions of Baby Boomers begin enrolling in the government health care program.
usatoday.com/news/washington/2010-06-20-medicare_N.htm
Seriously bring something to the table when you post.
Why do you cherry pick cancer. The bottom line is we spend 7-8000 per patient per year and socialized medicine spends 3000-4000 per year and we have similar overall outcomes.
Catlin A, Cowan C, Hartman M, Heffler S National Health Expenditure Accounts TeamNational health spending in 2006: a year of change for prescription drugs.Health Aff (Millwood)20082714-29 pmid:18180476
Catlin A, Cowan C, Hartman M, Heffler S. National Health Expenditure Accounts Team. National health spending in 2006: a year of change for prescription drugs. Health Aff (Millwood). 2008;27:14-29. [PMID: 18180476]Abstract/FREE Full Text8.↵Organisation for Economic Cooperation and Development. OECD Health Data 2007. Paris: Organisation for Economic Cooperation and Development; 2008. Accessed at http://www.oecd.org/health/healthdata on 12 May 2008.
Because of the financial incentive to do lots of tests (that the doc gets paid extra for), it is believed in research communities that the US cancer mortality rates are lower because we catch many cancers *much* earlier than other places in the world and that, as had finally been figured out with prostate cancer, most of those are extremely slow growing and would never have been a threat to the life of the patient at all. We find a few irregular cells in a milk duct, take out a lot of breast tissue and dose up the woman with chemotherapy and call it a cure when there is an extremely high chance that doing nothing for 20 or 30 or 40 years until the patient died of heart disease would have been just as “effective” except it wouldn’t have gotten into the statistics.
I simply would like you to compare something simple, the cancer mortality rate in the US as compared to Canada.
Here it is as a spreadsheet: Have fun!
http://spreadsheets.google.com/ccc?key=tsI9mtBAHd84DHdNQhO17Pg#gid=0
Source: (World Health Organization) WHO 2009
Cancer Mortality rates per 100,000 Population
Japan 120
Cuba 131
Italy 132
USA 133
Germany 135
France 154
So the USA is good but it ain’t all that. Cuba beats us. But Cancer isn’t the only thing that gets ya. For example look at France. It has a higher cancer mortality rate than the USA as reported by WHO but the WHO ranks France #1 in TOTAL health care and the USA at #37. So of course USA has great healthcare, doctors hospitals etc. if you have good insurance or are rich but our health-insurance system and lack of good insurance for many sucks.
The western countries with socialized medicine kick our butts for half the cost. Come on people, face it.
People who currently have insurance are probably happy with the system. Especially now that the office visits are easier to schedule, because half the country doesn’t have health insurance.
Shoot, I forgot Canada in that post but it was in the spreadsheet I posted and in the other post above.
Cancer Mortality rates per 100,000 Population
Japan 120
Cuba 131
Italy 132
USA 133
Canada: 135
Germany 135
France 154 source: WHO
I would like to point out one HUGE thing about cancer. Most/all of the modern cancer treatments (which have drastically reduced mortality) were discovered and developed in the USA. Americans are subsidizing the rest of the world when we pay full price, which covers the R&D cost as well as the manufacturing costs, etc.
Not saying it isn’t still overpriced, but that is an important thing to remember when making international comparisons. We come up with the cures; they don’t.
People who currently have insurance are probably happy with the system. Especially now that the office visits are easier to schedule, because half the country doesn’t have health insurance.
This has been my own personal experience: it’s easy to see the doctor now, provided you can pay.
How many of those 93% who suffered severe illness were seniors on Medicare?
It’s also very easy to confuse care with insurance.
“93% That’s the percentage of Americans who suffered severe illness who were satisfied with their health care.”
You got a link for that, Bad Andy?
http://www.usatoday.com/news/health/2006-10-15-health-poll1.htm
Quite a poll for you to bring up. It shows that the majority is dissatisfied with both the quality and the cost of the current system.
The majority are worried about losing their coverage, and the majority are worried about being able to pay for their coverage.
And the majority wants a universal health care system.
Great link, Bad Andy!
The point is that people are happy with what they have. Everyone likes the thought of a single payer system…in theory.
I like the idea of unicorns as well.
And the majority wants a universal health care system…..The majority are worried about losing their coverage, and the majority are worried about being able to pay for their coverage.
Ahh the physical, psychological and emotional benefits of living in the richest country in the world…. and with a government of the people, by the people and for the people.
For hospital reimbursement, Medicare (excluding advantage plans) pays less than private insurance plans in most states. As is to be expected since Medicare, after all, has more bargaining power since the overwhelming marjority of seniors are covered by it. And hospitals make money over their costs off Medicare patients. Hospitals that would not be able to cover their costs under the regular Medicare reimbursement schedule, are generally in rural areas and get designated “critical access hospitals” and are allowed to collect from the Medicare program on a “cost plus” basis rather than on the general schedule of payments.
Medicaid pays a lot less than Medicare (in most, though not all states). 55% to 70% of the Medicare reimbursement rate covers most states.
Saying that you are satisfied with the quality of healthcare in this country is like saying you are satisfied with the performance of the cars sold at the local BMW dealership.
Most people can afford neither.
The point is that people are happy with what they have.
Except for the ones who don’t have, eh?
But your base is the haves and have-mores, so I guess that doesn’t count.
Survey conducted September 7-12, 2006. Pre-bubble burst and pre-recession.
I wonder how many are still satisfied with care 4.5 years later.
Some of those suffering a severe illness may choose to hire an Advocate at $50-200/hour to help navigate their insurance coverage and billing.
marketwatch DOT com/story/private-health-care-advocates-offer-other-options-2011-04-18
Because free-market, corporate capitalism always allocates resources most efficiently providing greater benefit to all, especially within the for-profit health care “industry”
Why not. Most people can’t do their income taxes by themselves either.
I could hijack this thread and start talking about the public education system in this country but I won’t.
When I’ve gone into Housing Bubble Explanatory Mode, I’ve been asked if I’m in real estate.
Ummm, no.
Maybe that’s wishing thinking on the part of those asking!
How does the media make money? By providing advertisers with an audience. The media makes money from advertisers.
The financial / insurance / real estate (FIRE) sector advertises quite a bit. This is a business-based reason why the MSM is always going to be favorable to their point of view.
The “News” is not in the business of presenting news. That is a by-product. Their business model is based on providing advertisers with an audience.
It’s always important to understand the business model - how the organization pays its bills - no matter where you are.
Yeah, I think we should all be a good audience for the various advertisers on this blog too.
Balancing Budgets on Drivers’ Backs. ~ Fox News ~ 4-19-11
States like California are raising traffic fines instead of increasing taxes to generate a source of revenue.
Cities and states across the country are broke. But instead of raising taxes, lawmakers are raising traffic fines.
“This business of using fines and traffic fees as revenue sources is just flat wrong,” said Lew Uhler with the National Tax Limitation Committee. “This is simply a tax by another name.”
Nowhere is that more obvious than Los Angeles, where the city collects more then $1.8 million a year at a single intersection in the San Fernando Valley from drivers running a red light. Cost per ticket is $476.
“It’s almost $500 and I have three kids right now,” said Jesus Altamirano, standing outside a Los Angeles municipal courtroom where he is fighting a red light violation. “It’s just hard the way they want to get you with these tickets.”
But it’s not just California. In a memo obtained by the Boston Herald, local police chief Ken Coye instructs his officers in the suburb of Malden to write at least one traffic or parking ticket per shift.
“We need to increase enforcement in areas that create revenue,” says the Coye memo. “Write ‘ONE TAG A DAY.’”
Lawmakers around the country seem to listening.
* Parking in a fire lane in Pensacola, Fla., will cost you $100, up from $10.
* Georgia recently added a $200 surcharge for anyone driving more than 85 miles per hour.
* Colorado increased fines for speeding from $50 to $135.
* Portland, Ore., increased fines for parking in a handicapped spot from $190 to $450.
* Parking fines in Boston doubled to $40.
* Speeding in Florida just 10 miles over the legal limit will cost you $196, up from $154.
“We cannot afford to pay tickets, especially when we don’t feel guilty for what we are being fined for,” said Luis Rivera, a California contractor. Rivera was slapped with a $276 fine for not closing the tailgate on his pickup truck.
California’s State Senate President Darrell Steinberg admitted lawmakers raised traffic fines to raise revenue - not for traffic safety or to change driver behavior. It’s “one of the patches that we’ve relied on to avoid deeper cuts” to state programs, he said.
But closing a $28 billion dollar deficit isn’t easy. Consider these Golden State fines:
* Driving one to 15 miles over speed limit is $215. Compare that to $50 in Idaho and Washington State.
* Run a stop sign: $236
* No seat belt: $148. In Louisiana, the same infraction is $25.
* Broken headlight: $100
* Park in a disabled spot: $1,043. A second offense is $2,000.
* Pass a school bus with flashing red lights in San Francisco: $754
“We ought not go to bankruptcy court as a result of simple infractions of driving laws,” complained Uhler, who believes collections go down when fines get too high because motorists simply can’t pay or refuse to because “punishment doesn’t fit the crime.”
Petros Abraham agrees. He got cited at 2 a.m. one night for making a right hand turn at a red light when he failed to stop for the required 3 seconds.
“I don’t think it is fair,” said Abraham. “They’re just dumping all of their problems back onto the people, back onto the taxpayer.”
I predict a big fail on this one. Not only are more and more people not going to be able to afford to drive, but even if they could, many have no where to go because other than fishing, where can you go that doesn’t require money when you get there?
People will hafta take up kite flying.
When ticket prices get this insane (in order to raise revenue) - corruption will follow:
400 NYPD Bronx Cops Under Investigation - Fixing Tickets
WSJ | April 19, 2011 | Aaron Rutkoff
A transcript of one wiretap from the investigation offers a sense of just how commonplace the practice is. In a telephone call, a Bronx police officer told a union delegate that a cousin of the officer’s boyfriend had received a speeding ticket in Queens.
The delegate assured her that “I’ll get this taken care of” and promised to call two union officials elsewhere who he thought could help, according to the transcript. The delegate added that even in the “worst-case scenario” — if the ticket was not “pulled tomorrow” — there was still hope, the transcript says. “We’ll speak to the officer,” the delegate said, “and then fix it before trial, O.K.”
Cops never write other cops tickets. Period.
Went on a ride along program back in the 70s. Rode with a traffic enforcement officer. 10 over meant an automatic ticket.
At least until 1am. Was out on I-35, north of town, running radar on the bar traffic coming out of KC, and looking for drunks.
Headlights popped over the hill. The guy rings up “105″ (his was back in the 55mph days). Policy at the time was anything over 90 meant a tow, impound, and a trip to jail.
Pulled him over as he exited to come into town. A cop, one of the detectives. Free pass, no harm, no foul. Don’t know if he was drunk or not.
The whole bottom level of our criminal justice system is for raising revenue. Somehow that’s gotta be unconstitutional, but good luck finding anyone in the legal establishment willing to take up that fight. USA = TFTF
Shut up and pay your fines. The paper-pushers deserve to retire with their sweet pensions at 55.
Even if every Californian got a speeding ticket it wouldn’t plug the deficit, nevermind the underfunded pensions.
Unfortunately that’s the same argument that every interest group uses to point the finger at someone else. Exhibit A: “Even if you raised taxes on the rich it wouldn’t solve the deficit, so don’t raise taxes on the rich.”
The only infraction I agree the high fine is the running the red lights. That’s very dangerous. However, it wouldn’t surprise me if they timed the lights to be a few seconds too short, just to catch the last 2-3 cars trying to make left turns as the left arrow turns red.
I’ve discovered the joy of running errands early (7 am) in the morning on Saturday. Not many people out.
I’d be willing to pay more taxes to pay the national debt if spending was cut to allow for it. No worthless military spending on unjust wars, no social programs for those not in need (I’m including SS and Medicare in this). Unfortunately this will never happen in our traditional 2 party system.
SS is a self funded, non need based program. Your benefit increases with your level of contribution into it. Its not welfare.
“The only infraction I agree the high fine is the running the red lights. That’s very dangerous.”
I have no issue with punishing dangerous driving habits. But the idea that California can close its budget gap with speeding tickets is risible.
SS is not self-funded and is spiraling out of control. It was designed to be self-funded but as with everything the government touches, it was botched.
Botched by whom? The corporations who outsourced jobs so that a smaller pool of young is paying for a larger pool of seniors? Or the Republican governments who raided SS as if it were the general fund because it had too much money (”we’ll just use that money to cut taxes….”)
Your benefit increases with your level of contribution into it. Its not welfare.
and once “means testing” gets put in place as many are clamoring for, will you feel the same way?
The corporations who outsourced jobs so that a smaller pool of young is paying for a larger pool of seniors?
Are you suggesting that there would be no problems with SS without outsourcing? That the problem is a question of employment % rather than a demographic one? It was a ponzi scheme from day one.
Or the Republican governments who raided SS as if it were the general fund because it had too much money
Are you suggesting that democratic-controlled congresses didn’t do the same thing? Or that no dems voted for spending the money that was the SS “surplus” and replacing it with IOUs? Are individual politicians not responsible for their individual votes? They get a pass if their party doesn’t hold a supermajority of seats in congress?
I really don’t get the team loyalty here. It’s not a sporting event. All of the politicians f’ed us. And they did it because that’s what the people of this country voted for.
and once “means testing” gets put in place as many are clamoring for, will you feel the same way?
Of course not. Which is why we should oppose that. Because once it becomes “welfare”, then it will be easier to rid of entirely.
But I have paid hundreds of thousands into it, so don’t tell me that my promised benefit is “welfare”.
“Botched by whom?”
Oxide, you should know by now that I’m of no political party. Our insane government regardless of who has been running it has botched the system.
“SS is not self-funded”
Have you never heard of the payroll tax? Or do you think that SS is funded from the income tax? The payroll tax is dedicated to funding SS, hence it is “self funded”.
“It was a ponzi scheme from day one.”
No, its a pay as you go system.
Is it probable that benefits wil have to be reduced because of demographics? Of course.
But unless the payroll tax goes away SS will never completely run out of money, which is what happens to real ponzi schemes.
so don’t tell me that my promised benefit is “welfare”.
I haven’t said that.
However, just because you paid in doesn’t make it not a welfare program. If people who didn’t pay in also get SS, then I would argue that yes, it is a welfare program.
And if you get more out of it than you paid even (even if you paid in hundreds of thousands), it is as well.
“…..timed the lights……”
Several cities have been shortening the length of the yellow lights, as soon as they get the red light cameras up.
And everybody know about stretches of road/highway that have nonsensically slow speed limits. This is not an accident.
As I’ve been told, when a new road is built, the way it is supposed to be done is to set it at the 85 percentile speed, after leaving it unposted for a period of time, and accounting for site lines and braking distances. Most speed limits are set 10mph below the “correct” speed limit.
“However, just because you paid in doesn’t make it not a welfare program. If people who didn’t pay in also get SS, then I would argue that yes, it is a welfare program.
And if you get more out of it than you paid even (even if you paid in hundreds of thousands), it is as well.”
+1
Many here also forget that the life expectancy in 1935 was 59.9 years for men and 63.9 years for women. In 2007 it was 75.4 for men and 80.4 for women.
In 2007 (the US life expectancy) was 75.4 for men and 80.4 for women.
And it’s even higher in Canada, Cuba and in most of Europe. They have universal health care too I think.
I’m done debating health care with you. If you believe the same government that rounded up Asians and put them in camps, destroyed people’s personal and professional lives for being “Communist”, created the Patriot Act, waged unjust wars in Afghanistan, Iraq, and Libya, bailed out the banks, and manages Medicare and Social Security will do a good job with health care I wish you the best of luck and we can just agree to disagree.
I think you all underestimate how much the non smoking campaigns have done to extend life and of course many more years of SS and pensions….
If we can blame it on all those who quit smoking or never started then serious reform can happen
——————————-
Is it probable that benefits wil have to be reduced because of demographics? Of course.
You can’t look at the life expectancy charts that way. Infant and early childhood deaths are a huge factor. You have to look at how much life expectancy has increased for people who live to 65. That is the only relevant number. Well, 67 now, but you get the picture.
Hint, for people at the lower end of the wage scale, the increase is very small.
That is the only relevant number. Well, 67 now, but you get the picture.
I agree that you can’t simply look at the average. But if you’re going to consider those that collect for longer, you also need to look at those who don’t collect, but live longer (pay in) than they did before.
Both are ways that life expectancy changes affect the SS system.
If you believe the same government that rounded up Asians and put them in camps, destroyed people’s personal and professional lives for being “Communist”, created the Patriot Act, waged unjust wars in Afghanistan, Iraq, and Libya, bailed out the banks, and manages Medicare and Social Security will do a good job with health care I wish you the best of luck and we can just agree to disagree.
And if you believe that the same corporations who wink and nod at illegal subcontractors, outsource by the tens of thousands, report different earnings to their shareholders and the IRS, deny health insurance to everybody over the age of 65 (which is why Medicare was created to begin with), encourage the government to wage unjust wars for the sole purpose of securing no-bid contracts, buy off Congressman and governors to make tax law and regulations their favor, pour shoddy concrete in a deep ocean oil well over the advice of the hands-on engineers just to save a half mil, bid up the price of Needs like food and oil thus profiting off the human condition, laugh at burning Grandma Millie just to make a buck on trading in electrcity, go on a huge debt spree and then whine to the government for a bailout can do a good job with health care, I wish you the best of luck and we can just agree to disagree.
Splendid retort, oxide. +1,000
Really? Who invented penicillin? What about tylenol? These were gov’t programs? Hmm.. ok what about chemotherapy? Lets see, how about proton radiation treatments? Oh also not a gov’t program? ok… well, what about the entire concept of health insurance? Surely that came from our great legislative body.Oh wrong again? I see.
Well other than the Internet, which didn’t take off until it was turned over to private institutions, what great advances in Medicine and lifestyle have the feds given us? Oh right, extraordinary rendition.. That was a GREAT program. Glad that one improved our lives… Oh TSA security screening.. another real winner. AT LEAST IF A PROGRAM IS A FAILURE IN THE PRIVATE SECTOR, IT LASTS ONLY AS LONG AS PEOPLE PUMP MONEY INTO IT.
Point being, no one is pointing a gun at you to make you pay healthcare costs. If you want a better system, create one that is better that people can freely choose. If it really is so much better, let it win in the free market! Don’t force them into it.
what great advances in Medicine and lifestyle have the feds given us?
Forced sterilization? Tests performed on military personnel without consent? Tests performed on minorities and prison inmates without consent?
We give the gov’t a monopoly on the use of force. That is a very dangerous thing.
Mathguy, a lot of the medical advances were made in universities, which are government funded, or by military. And yes, there were many private medical advances too. However, those were in the past. Nowadays drug companies buy proof of concept from the local university (proof of concept is where the failure is) and spend all their money on marketing to doctors and horrid TV commercials.
I do agree that government is slow to cut useless programs, but that is changing, slowly of course.
Those machines that TSA security screeners use is a private compnay.
And as for the internet: After the government turned it over to commercial purposes, the internet took off all right — right off to India, taking off American jobs with it. And those jobs were outsourced or H1-B’d within 10 years of taking off.
“SS is not self-funded and is spiraling out of control. It was designed to be self-funded but as with everything the government touches, it was botched.”
Wrong again.
SS is fully funded. In fact SS has run a surplus *every single year* since it was setup. Including 2010.
mathguy,
Copying over a post regarding this topic:
Additionally, the taxpayers pay for the majority of our medical research, either through the NIH or public universities or grants, etc. Why should the private industry reap the rewards from the research (especially the foundational R&D) that the taxpayers have paid for?[/quote]
While NIH is government funded, not many institutions have access to this money. A majority of research is paid for my pharma companies through clinical trials and philanthropic funds distributed through grants.
- Previous accountant for the research department of Scripps[/quote]
The NIH, alone, provides approximately 30% of the funding for medical research:
The impact of even small NIH budget cuts is severe: The agency funds about 30 percent of all medical research in the U.S., according to the Journal of American Medical Association.
http://news.medill.northwestern.edu/chicago/news.aspx?id=83157
Basic *scientific* research (including medical) is primarily funded by government sources. Many of our current medical innovations came from basic research conducted by government agencies not affiliated with the NIH (NSF, USDA, NASA, etc.). Note that the “other” category includes government funding from state and local governments, as well as universities and colleges using their own funding:
http://www.aaas.org/spp/rd/usba07.pdf
AND:
When public money is invested in university-based basic research there is tremendous return on investment. Research creates jobs directly for those involved and indirectly for many others, through innovations that lead to new technologies, new industries and new companies.
The content and examples provided here illustrate some of the economic benefits the nation reaps when companies are created as a result of discoveries in federally funded university laboratories. While there are countless companies that have made use of the fruits of academic research, the roots of the companies highlighted here can be traced directly to seminal research conducted at a university and sponsored by a federal agency.
Were it not for the federally supported research, these companies – their products and services, and the jobs and economic growth that have resulted – likely would not exist.
http://www.sciencecoalition.org/successstories/
Private industry didn’t invent penicillin.
Here’s the history:
History of Penicillin
Originally noticed by a French medical student, Ernest Duchesne, in 1896. Penicillin was re-discovered by bacteriologist Alexander Fleming working at St. Mary’s Hospital in London in 1928.
…It was not until 1939 that Dr. Howard Florey, a future Nobel Laureate, and three colleagues at Oxford University began intensive research and were able to demonstrate penicillin’s ability to kill infectious bacteria. As the war with Germany continued to drain industrial and government resources, the British scientists could not produce the quantities of penicillin needed for clinical trials on humans and turned to the United States for help. They were quickly referred to the Peoria Lab where scientists were already working on fermentation methods to increase the growth rate of fungal cultures. One July 9, 1941, Howard Florey and Norman Heatley, Oxford University Scientists came to the U.S. with a small but valuable package containing a small amount of penicillin to begin work.
History of Peoria Lab (penicillin and more):
Agricultural research has been extremely beneficial to the United States. The United States has always been a worldwide leader in agricultural production and technology. The United States Department of Agriculture (USDA) and its research laboratories like the National Center for Agricultural Utilization Research (NCAUR) are strong contributors to this standing. Since its debut in 1940, the NCAUR in Peoria has touched many lives with its ingenious innovations and has made countless gifts to science and business.
The NCAUR, more commonly known to Peorians as the “Ag. Lab,” was first authorized by Congress as part of the Agricultural Adjustment Act of 1938.
http://www.lib.niu.edu/2000/ihy000223.html
Thank you for reminding me that not all the money we pour in is wasted. I followed some of the links and learned a bit more of the history of penicillin. Although the Peoria lab by no means discovered penicillin, they definitely made it mass producible. I would never argue that nothing good comes out of gov’t , and especially not our gov’t.
But I would argue that every dollar taken is taken at the threat of imprisonment for failure to pay. To me, that sets the bar very high for what we should allow the gov’t to be in charge of. When was the last time you heard of someone dying of IBM security guard brutality? Contrast with FBI, ATF, CIA, Border Patrol, or even airport police.
Thank you for your kind thoughts, mathguy.
IMO your security guard example is apples and oranges. If IBM was invaded by the same unsavory characters who invade the border or do the things that FBI and ATF patrol, you probably WOULD hear about brutality.
Not that the brutality is good — just that the usually the bad guys get caught by ATF border/patrol et al before they get near an IBM building. Which is why IBM can get away with Wackenhut rent-a-cops.
“States like California are raising traffic fines instead of increasing taxes to generate a source of revenue.
Cities and states across the country are broke. But instead of raising taxes, lawmakers are raising traffic fines.”
This news story is several years and two traffic tickets too late for me. The two tickets I received were both for driving habits that I acquired competing with real estate agents and investors during the bubble years. After the bubble popped, the number of traffic cops looking for any excuse to give a ticket increased, and I was among the greater fools who got to make extra contributions to the CA State general fund as a consequence of adapting too slowly. But I anticipate no further issues, as I am quite cautious about ticket-able driving behavior these days.
“But I anticipate no further issues, as I am quite cautious about ticket-able driving behavior these days.”
Don’t count your chickens before you fry em.
Ever heard of “suspicious driving?”
While you can’t be ticketed for that, you can be stopped for it; and once that happens, the shovels come out.
*be advised*
(or learn spanish)
“suspicious driving”
I don’t stand the risk of ever being accused of ‘driving while black,’ if that’s what you mean…
I worked with a guy who complained about being profiled for his ponytail. I didn’t understand why he didn’t just lose the ponytail.
I worked with a guy who got a ticket for driving too slow.
Driving too slow can mean DUI.
These “taxes” are all avoidable. Quit running stop signs, red lights, parking in fire lanes, excessive speeding, etc. and you won’t have to pay. Because some people can’t plan ahead or keep themselves on a schedule doesn’t mean the safety of the rest of us should be jeopardized.
Don’t like the laws? Talk to your congresscritters.
Speeding by others should be encouraged.
Every road and highway needs to have designated speeders to keep the cops busy. I am very happy so many of my fellow motorists volunteer for the role.
If you want to speed then go ahead and do so. I speed, but I make sure I am among some of the slowest speeders on the road.
“…designated speeders…”
I keep my eye out for these and keep up with them from a safe following distance once they pass me…
I HATE people that follow me on the highway - make it a point to have them figure out that they don’t want to be near me.
Just sayin…
“…make it a point to have them figure out that they don’t want to be near me.”
I don’t tailgate these folks; follow them from as far back as I can keep them in view, which allows plenty of time to slow down in case they eat a ticket.
I just love this “it doesn’t matter if it’s right, it’s the law attitude”
Maybe I’ll have the Feds pass a law fining everyone who has ever used the word “combo” in a blog post 100 bucks.
“Right” has nothing to do with it, dontcha know?
You are right, X.
Further, I don’t remember being allowed to vote on the speed limit nor traffic fines.
Kim:
There are already laws in place that prevent states from exacting back-door taxes and calling them something else. When exorbitant fines are being collected with the stated purpose of raising revenue, there is a legal problem WAY bigger than simple traffic infractions.
Nowhere is that more obvious than Los Angeles, where the city collects more then $1.8 million a year at a single intersection in the San Fernando Valley from drivers running a red light. Cost per ticket is $476.
Well - Somebody has to pay for those public union pensions.
In the end - the public union bought politicians will squeeze every last drop of money from the citizens they are “sworn to protect” and sell every last public asset before the touch one insane public union salary, benefit or pension.
And the police will wonder why every citizen (not gang bangers) will hate them.
i don’t need an unfunded pension to dislike cops.
just about every cop i have met was a complete asshole.
love this criminal justice education add…this is who the profession attracts…mostly.
http://cj4.mylawenforcementdegrees.com/?sub_id=101686&sub_cd=Bo1o001o08o00007oad259o2111o9oROS
Power corrupts, (you know the rest).
“just about every cop i have met was a complete asshole.”
Out here the lion’s share of State Troopers (Highway Patrol) are ex-Marines. They are the biggest bunch of douchebags you ever met, and why I always drive below the speed limit.
I’ve met a few city cops who were mega jerks too.
Out here the lion’s share of State Troopers (Highway Patrol) are ex-Marines.
expect this to get far worse. How many people are we training up for our military these days? And what kinds of jobs do the “grunts” tend to go into once they get out?
Sadly, it appears many bring their military/war outlook to their “peace officer” role.
If we don’t like punishments associated with speed limits, red lights, and parking managment, then change the law. But for things we’ve deemed against the law, then the fines should be high.
OK, then: How about a $100,000 fine for rolling through a stop sign? Because that would be a high fine for something deemed against the law.
Fine. I have no problem with that.
Let’s qualify that law, then: If YOU roll a stop sign, YOU get to pay a $100,000 fine.
Current law applies to the rest of us.
Let’s qualify that law, then: If YOU roll a stop sign, YOU get to pay a $100,000 fine.
———————–
Or we could use the death penalty for people who roll through stop signs. Then maybe traffic engineers could place them intelligently rather than sticking them everywhere.
FYI: you are more interesting when you aren’t posting internet arguments like a 3 year old, which i’d call the equivelent of rolling through a stopsign going from $236 to $100,000. It’s logic like that you all rightfully make fun of bananna for, but then here you are using the same logic for a cause you disagree with.
People are killed once a month in my NEIGHBORHOOD alone from running lights and stop signs.
6 days a week there is a bad traffic wreck within a 5 mile radius of my house.
I PERSONALLY see at least one dead person a year driving by a traffic wreck. Again, just in my area.
You could say the death penalty is already in force.
I have no problem with them raising ticket fees.
Overdog:
Don’t be stewpit. Of course you have a problem with that. No one could pay that except for the uber-wealthy. The state should not have the right to bankrupt you, especially over something subjective and PETTY such as “rolling”. So the cop says he only counted 2 seconds of a full stop? I counted 5! But the state wants its fine, so everyone’s guilty and everyone owes $100k. Next thing is we all get our wages garnished, so now we’re all dirt poor, while the state is FILTHY RICH. Try to hire a lawyer to protect yourself against your overlords now, dog.
I see no problem with this. Learn how to drive better (With the cell phone off and stopping completely at stop signs) and you wont get a ticket. I really wish the roads were safer, as I don’t want my “Game Over” to be some broad rolling a light while updating her Facebook status.
In my opinion - its a stupid tax. Don’t be stupid and you won’t get taxed.
Learn how to drive better (With the cell phone off and stopping completely at stop signs) and you wont get a ticket.
If you really believe this, you should read up on red light cameras.
You can get a ticket even if you don’t break the law, and can’t get a jury trial to prove it.
I see no problem with this. Learn how to drive better (With the cell phone off and stopping completely at stop signs) and you wont get a ticket. I really wish the roads were safer, as I don’t want my “Game Over” to be some broad rolling a light while updating her Facebook status.
Agreed!
And, speaking as a bicyclist, I’d love to have some sort of handlebar-activated cell phone-silencing device. Or, perhaps, some sort of device that would send a “Pay attention to your driving!” message to people I see on their phones.
Learn how to drive better
The party people in Rio are really upset because as of about a year ago you really can’t drive drunk anymore. I mean it’s a law that is actually being enforced now.
Now it’s hard to get a taxi at 3 am on a weekend.
Slim, you can buy a phone jammer that’s about the size of a pack of cigarettes. Just don’t get caught with it. Federal offense and all that.
You can find it through a search.
Why would the Facebook user be a broad? Because women cause fewer accidents than men? Or just because no one wants to date you?
Take your own informal poll driving home tonight. If you are sitting at a light at a major intersection, check the drivers as they pass for:
-Gender
-If they are yakking on a cell phone.
My own informal polling shows that at 5pm, fully 2/3 of the women drivers of all ages are on a cellphone.
Versus 1/4 to 1/3 of men, mostly below the age of 35. Probably taking calls from their girlfriends.
Better yet, tally all the dolts driving 10mph below the limit, weaving all over the road in the passing lane. The same ratio is evident. At least before 8pm.
Don’t take my word for it. Check it out yourself.
And just wait until the government figures out if people are yakking and driving by tracking your movements between cellphone towers. It would be easy to set up a program to have the cellphone company kick out these phone numbers, then send you a ticket/bill.
My son is the only one in my family that has gotten popped for our new cell phone law. He won’t do that again.
Enough with the informal probably’s.
Check the rates on auto insurance.
You are finding what you’re looking for.
The fine for running a red light SHOULD be very high. It’s an extremely reckless act. These fines, unlike taxes, are completely voluntary.
I would like the board to forgive me for the last time I ran a red light. It was a few weeks ago. I was giving a friend a ride home from a rehearsal. It must have been 11:00 PM or close to it. We were taking a back road from Bethesda to her apartment. We came to a T-intersection with a red light where we needed to make a left turn. We waited. We chatted. We waited some more. I asked her if we had missed a green light. She didn’t think so. We waited a bit more. Two cars passed making it obvious that I could see oncoming traffic well in advance of its arrival. It must have been close to 7 minutes at this point. I said that if it didn’t change soon, I was going to take the left. I looked for a red light camera and didn’t see on. After a bit more time, I took the left.
Still can’t figure that one out. Anyway, the only other course of action was to turn around (illegal) or turn right and do a three point turn (illegal) to go back the other way.
But I still beg your forgiveness.
LOL!
Just a couple of weeks ago, I had the same sort of experience. All the other lights were working, but the left-turn signal for our lanes (2 turn lanes) never turned green. After a number of cycles, we all just checked the traffic and turned left using the green signal (as if making a left turn at a signal without green arrows).
“States like California are raising traffic fines instead of increasing taxes to generate a source of revenue.”
This hydra won’t go down without a fight.
I don’t feel safe from the cops anymore. I see them hiding out at various places and try to avoid such places. 500 dollar fines are just too steep.
Some states have already been doing this for years (such as Arizona). Arizona has even done away with juries and attornies for people charged with crimes “because it’s too expensive”. How many liberties and rights are we going to forfeit, just to make sure that bankers and international corporations don’t have to spare a dime?
Often called “rocket dockets.”
However… you are given a choice. Most defendants choose expediency as well. If a choice of a jury is not offered, they have recourse by federal law.
Last ticket was around 1991. Yes, I was speeding. It was after dark on a secondary road and I couldn’t see the radar cop until his lights came on after I passed him.
Boy was I pissed! Somehow I tried to transfer blame to the cops. It took a few days before rational thought returned.
No, you are not given a choice in Arizona. You are simply told to pay for your own attorney, and that you will not have a jury. You get a bench trial (in other words, that state that charged you gets to try you). For a crime, not an infraction or a petty offense.
I wonder what Arizona will do when all of the poor folk are in jail and all of the illegals have been deported.
Then why the heck do I keep getting called for jury duty in AZ??? I can assure you that not all trials are bench trials in Arizona. I seem to remember some federal document that guarantees all citizens the right to a trial by a jury of their peers…
Yes, Max, the Constitution does state that. But Arizona has been thumbing its nose at the Constitution for quite some time now, and apparently there aren’t enough rich people left to do anything about it. You have to have deep pockets to fight the state. If you don’t believe me, then try looking it up. I think you will be shocked at what you find.
Works for me. Most people drive like effing morons.
Hint: don’t drive stupid and 99 times out of a 100, you won’t get a ticket.
I’ll admit to bicycling like one yesterday.
Was coming home from running an errand. And I started from a stop without looking to my left.
Oops. Couple of cars coming at a pretty high rate of speed.
Fortunately, they were far enough away that I was not in any danger. But my bad, very bad. That non-left look could have had a different result.
When proceeding from a stop, ALWAYS look left first.
Except if you’re in England. Then you should look right.
geez, cant they just stop beating the red light instead of whining about big fines?
It never ceases to amaze me when I cut it close to see one or two more cars go through behind me.
geez, cant they just stop beating the red light instead of whining about big fines?
And when you stop a bit over the line because the guy behind you was closing in fast and you felt it imprudent to slam on the brakes and stop short?
Oh yeah, you get a ticket for that. And your “story” doesn’t count as heavily as the photos they took of your tires over the line.
When I tried the last link posted below, an image of Hillary appeared on my screen. Talk about your early-morning case of the heebie-jeebies!
Dead Suit Walking
If this isn’t the Great Depression, it is the Great Humbling. Can manhood survive the lost decade?
Fedrik Broden for Newsweek
Brian Goodell, of Mission Viejo, Calif., won two gold medals in the 1976 Olympics. An all-American, God-fearing golden boy, he segued into a comfortable career in commercial real estate. Until 2008, when he was laid off. As a 17-year-old swimmer, he set two world records. As a 52-year-old job hunter, he’s drowning.
Brock Johnson, of Philadelphia, was groomed at Harvard Business School and McKinsey & Co., and was so sure of his marketability that he resigned in 2009 as CEO of a Fortune 500 company without a new job in hand. Johnson, who asked that his real name not be used, was certain his BlackBerry would be buzzing off its holster with better offers. At 48, he’s still unemployed.
Two coasts. Two men who can’t find jobs. And one defining moment for the men in the gray flannel suits who used to run this country. Or at least manage it.
Capitalism has always been cruel to its castoffs, but those blessed with a college degree and blue-chip résumé have traditionally escaped the worst of it. In recessions past, they’ve kept their jobs or found new ones as easily as they might hail a cab or board the 5:15 to White Plains. But not this time.
The suits are “doing worse than they have at any time since the Great Depression,” says Heidi Shierholz, a labor economist at the Economic Policy Institute. And while economists don’t have fine-grain data on the number of these men who are jobless—many, being men, would rather not admit to it—by all indications this hitherto privileged demo isn’t just on its knees, it’s flat on its face. Maybe permanently. Once college-educated workers hit 45, notes a post on the professional-finance blog Calculated Risk, “if they lose their job, they are toast.”
…
Can Manhood Survive the Recession?
Sorry, He’s Toast
Love Means Never Having to Say ‘Get a Job’
Dead Suit Walking
Live Chat: The Recession’s Impact on Middle-Aged White Men
Brock Johnson, of Philadelphia, was groomed at Harvard Business School and McKinsey & Co., and was so sure of his marketability that he resigned in 2009 as CEO of a Fortune 500 company without a new job in hand. Johnson, who asked that his real name not be used, was certain his BlackBerry would be buzzing off its holster with better offers. At 48, he’s still unemployed.
Boo hoo. So he didn’t get any mongo bonuses? Is he going to lose his house or car? Are his kids going to have skip college and join the military?
I didn’t think so.
Brian Goodell, of Mission Viejo, Calif., won two gold medals in the 1976 Olympics. An all-American, God-fearing golden boy, he segued into a comfortable career in commercial real estate. Until 2008, when he was laid off. As a 17-year-old swimmer, he set two world records. As a 52-year-old job hunter, he’s drowning
And he’s nothing more than a glorified shoe salesman. Or is he supposed to be “special” and deserve a high paying job because he could swim really fast when he was a kid?
How about profiling some real people, like engineers who have been lost their jobs to offshoring and had to take big pay cuts to get another job, if any?
“How about profiling some real people, like engineers”
So what are some examples of fake people?
Fake people — Olmpic athletes and Victoria’s Secret models? Both are unnatural and there aren’t enough of either to count as a statistic.
Olympic athletes are notoriously broke. Few of them score endorsement contracts. Home Depot had a really good program. Home Depot sponsors some of your training as long as you work half-time at Home Depot. After you finish you career, you have some on-the-job training in construction materials. It’s not the greatest of careers now, but it’s more than nothing.
I am sure he’s still looking for some executive positions. Adjust your attitude and you will get hired. People need to understand that you aren’t entitled to cushy jobs and corner offices. What you had in the past might have been a fluke to this grossly bubblicious economy. It was not supposed to be long lasting.
No wonder nobody wants to hire him. Here’s the gem…..
This wasn’t supposed to happen. At Harvard, friends joked that Johnson had “the CEO look.” At 6 feet 4, with a full head of close-cropped hair, he not only looks but talks like Alec Baldwin’s Jack Donaghy character from 30 Rock. His résumé lists his strength as “transformational change management.” On his LinkedIn page he describes himself as a CEO, as though it’s an immutable characteristic, like his lake-blue eyes.
His résumé lists his strength as “transformational change management.”
And what in the Sam Hill is transformational change management? Sounds like a bunch of gobbledygook to me.
Sounds like getting the company though “hiccups” related to outsourcing to me. Or possibly getting set up for a leveraged buy out. Both would fit.
Maybe it changing a company from a profitable one to a money loser?
CEO’s don’t just quite…I think there was an underlying reason or two. Maybe he got caught with his hand in a secretaries cookie jar?
It means firing people and stiffing vendors.
When I was a manager I’d get pretty much every resume from Personnel; they made no apparent attempt to filter them for me.
A remarkable number of applicants talked in buzzwords about their skills. BFD. I wanted to know about their on-the-job accomplishments. There’s a big difference.
Gal I dated used to screen resumes for her law firm (one of the big ones).
Said one guy put how much he could bench press on his resume.
As much as I hate it, buzzwords impress people.
Because most people doing the hiring really have no grasp of your skills.
“It means firing people and stiffing vendors.”
Exactly right!
When management doesn’t have the nutz to cut deep they hire an outsider. Think public managers.
The problem with a lot of suits is that they have no skills outside of suit-dom. Ask ‘em to do home repair and they’re clueless. Cook a meal? They don’t know how to do that either.
The solution? Learn how to do as many different things as possible. After all, life lasts a long time.
What are you, some kinda dang socialeest/commie?! There’s no such thing as “skills” outside of banking and engineering and medicine!
This sounds very grim.
20 April 2011 Last updated at 06:44 ET
Wildfires destroy a million acres in Texas, US
Bone dry conditions and winds are said to have whipped up the flames
Firefighters in the US state of Texas are battling to contain wildfires which have burned more than one million acres in the past fortnight.
One official told CNN fires were burning “from border to border”, with some covering more than 100,000 acres.
Long-term drought, high temperatures and gusting winds have created ideal conditions for the fires to spread.
Several towns have been evacuated and flames are now close to Fort Worth, one of the state’s largest cities.
“The fire’s coming at Possum Kingdom Lake from just about every angle at any given time”
Lee McNeely Texas Forest Service
The Texas Forest Service said it had responded to 11 new fires on Tuesday, in addition to the scores already burning across the state. Nearly 200 homes are reported to have been destroyed.
Planes have been dropping water and fire retardant on the burning areas while firefighters have been dousing threatened homes.
“We’re actually seeing Texas burn from border to border,” spokeswoman April Saginor told CNN.
“We’ve got it in West Texas, in East Texas, in North Texas in South Texas - it’s all over the state,” she said, adding that four fires had merged in the Dallas area.
…
Fire is a source of renewal for the Prairies.
“The tallgrass prairie biome depends upon prairie fires, a form of wildfire, for its survival and renewal. Tree seedlings and intrusive alien species without fire-tolerance are eliminated by periodic fires. Such fires may either be set by humans (for example, Native Americans used fires to drive bison and improve hunting, travel, and visibility) or started naturally by lightning. Researchers’ attempts to re-establish small sections of tallgrass prairie in arboretum fashion were unsuccessful until they began to use controlled burns.”
http://en.wikipedia.org/wiki/Tallgrass_prairie
The fires didn’t “destroy” even a single square foot of land. It’s all still there. The vegetation will quickly re-grow.
It’s driving the feral hogs into the nearby cities.
Time to fire up the smoker………
The bad thing is it’s illegal to hunt them in city limits.
It’s only illegal if you get caught, or your neighbor narcs on you. Make sure all the neighbors get some ribs when you are done.
Sure, with rifles. Get out the boar spears and/or fire axes.
Texas is currently experiencing a record setting drought.
The last record?
2001.
As for the “border-to-border” comment, Texas is huge and a quick look at a satellite image will show that they are a only spot fires.
Don’t try and stop the MSM when they’re in a frenzy of parroting the latest catchy phrase.
One of the best parts of “The Right Stuff” was the sound effects of locusts in the scenes with the media.
Financial Crisis: Clinton Rooted, Bush Fed, Obama Watered
Apr. 18 2011 - 1:36 pm
Posted by Richard Lehmann
(Unofficial seal of the United States Congress)
The December 2010 release of the report by the Financial Crisis Inquiry Commission proved to be controversial because of the split among the members on what were the causes of the crisis. The official report lists nine ‘findings and conclusions.’
One dissenting report by three commission members lists ten and the other dissenting report lists mainly one. Congress, in its collective wisdom, decided it need not wait for this report to legislate a remedy via the Dodd Franks financial reform legislation. As you can guess, this means the crisis was used to address unrelated problems and further social legislation.
…
“As you can guess, this means the crisis was used to address unrelated problems and further social legislation.”
I’ve heard of this before…Patriot Act anyone?
Fortunately the Patriot Act was repealed in 2009 when the Democrats held the presidency and both houses of congress.
On 2/27/10 Obama signed the re-authorization of some of the most disgusting portions of the law…such as roving wiretaps. The legislation to extend it to the end of 2011 failed.
Unfortunately both parties are guilty of playing with liberty.
Tweedle Dee vs Tweedle Dum
Fortunately the Patriot Act was repealed in 2009 when the Democrats held the presidency and both houses of congress.
And how many of those Dems voted for it in the first place? (many I would imagine. How many nays were there on the vote for the act? I think less than 5)
In the House of Representatives there were 3 Republicans and 62 Democrats who voted against the Patriot Act.
211 Republicans and 145 Democrats voted FOR the patriot act.
3 Republicans and 62 Democrats who voted against the Patriot Act.
Thank you. For some reason I had the impression it was near-unanimous. I feel slightly better about our congresscritters now…but only slightly
Most telling is the fact that less than 2% of Republicans voted against this atrocity.
Conservatives and Constitutionalists, you’ve been bamboozled by the Republican party and you continue to be bamboozled by these clowns.
Most telling is the fact that less than 2% of Republicans voted against this atrocity.
Certainly very telling. But greater than 2/3 of Dems voted for it as well.
No one gets a pass on that one. (except Ron Paul. He rocks
I’m not giving anyone a pass. I’m not for a 2 party political system, especially not a corporate sponsored 2 party political system.
I’m not giving anyone a pass.
I didn’t mean to imply you were. Your position is clear given your posting history here (and your other posts today)
With the exception of the whole nanny state desire, I share the same opinions as many here.
I guess you’d expect an article in Forbes to excuse excessive pay for top execs (’that’s been going on forever’), and excessive leveraging (’some regulator should have stopped them’) and lay most of the blame for the crisis on affordable housing programs. Even thought that wasn’t at all the conclusion of the report itself, which the writer admits is a well-reasoned, well-researched effort.
The whole Forbes family has made a career out of giving the top 5%er reach-arounds.
By all appearances, this bubble is already crashing to earth in California.
Higher Education: The Next Asset Bubble?
Education, Featured — By Robert Ross on April 19, 2011 6:35 am
Academics point to parallels between the housing crisis and the current U.S. higher education system
NEW ORLEANS, La. – Academics and business leaders claim that the Student Aid and Fiscal Responsibility Act (SAFRA), passed last year, has not corrected the underlying problem within the student loan system. Specifically, lax lending standards and artificially low interest rates for government subsidized loans exacerbate tuition increases, while academic achievement has remained stagnant.
SAFRA eliminated federally subsidized loans, instead using all federal student loan funding for direct loans. But continued easy money policies and growing applications provide little incentive for the government or universities to keep college tuition in check.
Dr. Richard Vedder, professor of economics at Ohio University, says that higher education is in a “bubble situation”, indicated by “its price [rising] sharply, fueled by cheap federal loan and grant money while the return on investment has fallen.”
Peter Thiel, who anticipated the Dot-com Bubble of 2000, also claims that a higher education bubble has replaced the housing bubble.
…
Dr. Richard Vedder, professor of economics at Ohio University, says that higher education is in a “bubble situation”, indicated by “its price [rising] sharply, fueled by cheap federal loan and grant money while the return on investment has fallen.”
Paul Craig Roberts has been saying for years that there are no jobs for college grads, and that most wait staff at casual dining restaurants have degrees.
While State U’s are not exactly cheap anymore, it blows my mind that there are so many high priced, regional private colleges that actually have students. And I agree that the easy loan program has enabled most of these private schools to charge their outrageous tuition rates.
On a similar note, it blows my mind that homes in San Diego County still sell for bubble-era prices (i.e. north of $500K), given the sea change of dwindling opportunities for those who could traditionally at least envision themselves paying off loans in these amounts.
“While State U’s are not exactly cheap anymore, it blows my mind that there are so many high priced, regional private colleges that actually have students.”
Well, the number of applications at many state universities seems to be going up and up. So it wouldn’t surprise me if a lot of those private school students didn’t get into the state schools. Too fearful to go without, they’ll take on debt for their degree.
Then again, college doesn’t come up suddenly out of nowhere. Parents have 18 years (plus time in utero) to plan for it, if they so choose. Those who use the time to plan wisely can send their kids anywhere they want.
I’m reminded of something that happened last week. DD has a coach who has mentioned a few times that they haven’t saved a penny for their childrens college education (oldest is a high school senior). I paid this coach for the lesson. She handed me money back and asked me to get a bottle of water from the vending machine ($1.50). I walked past the water fountain (free) to get to the vending machine, skaking my head the whole way.
If you do save for college, there is less grant money and financial aid.
Right now, the best state schools have a lower acceptance rate than the best private schools.
Actually financial aid is based more on income than assets. If you have the income and no assets you still won’t qualify for grants. You pretty much have to be on welfare to get federal need based grants these days. 30 years ago when I was a young pup almost everyone qualified for a Cal Grant in the golden state. That has changed.
I’ve never heard of some of the colleges with the lowest acceptance rate…
Curtis Institute of Music Philadelphia, PA 4.3%
Jarvis Christian College Hawkins, TX 4.6%
Rust College Holly Springs, MS 6.9%
Juilliard School New York, NY 7.3%
Harvard University Cambridge, MA 7.6%
Yale University New Haven, CT 8.5%
Cooper Union New York, NY 9.2%
Stanford University Stanford, CA 9.3%
Princeton University Princeton, NJ 9.6%
Columbia University New York, NY 10.0%
Alice Lloyd College Pippa Passes, KY 10.4%
College of the Ozarks Point Lookout, MO 11.5%
I’ve never heard of some of the colleges with the lowest acceptance rate…
Some of them have rigid entry requirements.
College of the Ozarks Point Lookout, MO 11.5%
They don’t accept anyone with missing teeth.
I’ve never heard of some of the colleges with the lowest acceptance rate…
Curtis Institute of Music Philadelphia, PA 4.3%
Jarvis Christian College Hawkins, TX 4.6%
Rust College Holly Springs, MS 6.9%
Juilliard School New York, NY 7.3%
Harvard University Cambridge, MA 7.6%
Yale University New Haven, CT 8.5%
Cooper Union New York, NY 9.2%
Stanford University Stanford, CA 9.3%
Princeton University Princeton, NJ 9.6%
Columbia University New York, NY 10.0%
Alice Lloyd College Pippa Passes, KY 10.4%
College of the Ozarks Point Lookout, MO 11.5%
To the above list, I’d like to add the service academies — West Point, Annapolis, USAF Academy, and the Coast Guard Academy. They’re tough places to get into. And not terribly easy to graduate from.
As for College of the Ozarks, I’ve always liked that place. Why? Because the students have to work there to make the place go. Campus fire department’s staffed by students.
IIRC, Cooper Union has free tuition (limited curriculum). Sounds like a good deal if their area of expertise matches your interests.
Not to mention Slim, you must be first appointed to the military colleges ( but the do give sports scholarships).
Not to mention Slim, you must be first appointed to the military colleges ( but the do give sports scholarships).
I’ve known people who’ve gone to the service academies. It’s not a snap to get an appointment. And that’s just one of the first steps on a very long road to graduation.
Alice Lloyd is free as well.
There’s a dorm at Uof Mich named Alice Lloyd. Coincidence? I bet not.
There’s a dorm at Uof Mich named Alice Lloyd. Coincidence? I bet not.
When I was there, Alice Lloyd was a very leftie place. Had a boyfriend who lived there, and oh, did we have fun satirizing his fellow Lloydies.
“Well, the number of applications at many state universities seems to be going up and up. So it wouldn’t surprise me if a lot of those private school students didn’t get into the state schools. Too fearful to go without, they’ll take on debt for their degree.”
I’m sure there is some truth to that. We also get quite a few out of state students at CSU and U Northern Colorado (the other UNC). Even with out of state rates it’s far cheaper than most private schools (Not CU, they gouge out of state students). At UNC they’ll even waive $5000 of tuition if your grades and test scores are high enough.
“Parents have 18 years (plus time in utero) to plan for it, if they so choose. ”
Of course, the best made plans can be laid to waste. When I started “planning” annual tuition at Colorado state schools was about 2K and stayed there for a while. Now all of a sudden it shot as high as 9K and is still rising. Meanwhile wages stagnated.
There are options of course. UNC (Northern Colorado, not North Carolina) is still “only” 5K, and Mesa State College in Grand Junction is tuition free for high test scorers/high grades.
Student loan debt will approach a trillion dollars by the end of this year. Anyone see a problem with that?
I do see a problem with that. I also see a problem with the traditional university education. It’s simply a machine that perpetuates itself by telling everyone that they’re inferior by not attending, much like a cult. I’ll take someone with 10 years of business experience any day over a 4-year graduate, especially since a good 2 and a half of those years are spent on core classes that have absolutely nothing to do with the actual field of study.
-Bad Andy, MBA
“It’s simply a machine that perpetuates itself by telling everyone that they’re inferior by not attending, much like a cult.”
All I know is that to succeed at work all I have had to do over the years is to tell coworkers/bosses that the pictures of their ugly kids were “cute” once and a while. In contrast getting good marks in grad school required taking positions on issues that I absolutely did not agree with simply because it was made very clear to me by some very opinated faculty what would happen if I didn’t.
I’ll take someone with 10 years of business experience any day over a 4-year graduate, especially since a good 2 and a half of those years are spent on core classes that have absolutely nothing to do with the actual field of study.
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I’m not sure I’d agree with that. First, core classes are used to make sure the person has good math, history, and writing skills, which are more rare than they are common. Tech schools do not teach the cores enough, so in my opinion, they tend to be lacking good soft skills while they may have good technical skills. If the job is hard skill, then yeah, who cares if they can write competently to upper mgmt, but for the majority of people, writing and being able to do math is as important as core classes.
2nd for experience, I would say it depends on the job, especially since there will be a 20-50% pay differential for those with good experience over none. Also, many industries change a lot in 10 years, so that experienced 10 year person may not have the latest skills, so they are going to need training.
3rd, as a person who interviews on a regular basis, I would say 50% lie in interviews egregiously. 10 years employement is more like 2-3 years experience in the actual jobs i’m interviewing for.
I’m sure you’re not pushing core classes. You couldn’t possibly be pushing core classes. Unless they’ve changed over the last 15 years, and I know they haven’t, these core classes are a re-hash of high school curriculum.
I’ll grant you writing. That said, any business school will require a business writing class. Business writing, public speaking, business management, and marketing are the most important classes in my line of work.
As far as lying in an interview, it’s common. It’s also very easy to detect at the interview stage and even easier to detect after hiring the individual. Fortunately I’m in a business where the product is pretty static, only the sales and delivery channels have changed.
When I went to school only about 2 semesters worth were “core”, unless you count Calculus I,II, III, DEs, Linear Algebra and Physics as “core”.
I guess it depends on field of study and what you consider core. I consider 9 credits of “cultural enrichment” to be core. I consider all 29 hours of “University General Education” to be core and I consider all 30 hours of what the University calls core classes to be core. That’s 68 credit hours out of a 122 credit hour program.
I’d agree that all that is core. I’d disagree that they are re-hash of high school, except for a small minority of gifted students. The remedial courses that are a re-hash of high school do not count towards total credits. But then if i parse your argument correctly, you want colleges to spend more time training (?) for a specific career/major than roughly half?
50% general, 50% specific sounds about right to me, but then I’m not of the opinion that specific job training such that they could be inserted into JOBA upon graduation should be up to the university, its job is to more generally educate.
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It’s also very easy to detect at the interview stage and even easier to detect after hiring the individual. Fortunately I’m in a business where the product is pretty static, only the sales and delivery channels have changed.
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After you’ve hired it’s too late as firing people is not easy or quick in modern society. I’d agree that an experienced sales person beats a new hire any day of the week, especially if they work on full commission, but not all jobs or industries share those same characteristics.
As an aside, I have no doubts that tuition is unstainable and that college costs have risen out of control.
But I’m not sure that has anything to do with the content of the courses, but rather universities add unnecessary ammenites that are reflected in the bill. These include the sports programs plus. For example, my alma mater had a large pool while I was there. They replaced that a few years ago with an large indoor/outdoor water park, and have subsequently raised tuition quite a bit to cover its costs.
“But then if i parse your argument correctly, you want colleges to spend more time training (?) for a specific career/major than roughly half?”
Yes. College is supposed to be the training ground for your chosen field. Has anyone tried to correlate the quality of our education system today with teachers going through traditional 4-year programs as opposed to the old days when teachers went through 18 to 24 month intensive programs? I don’t have any studies but I’m wondering out loud.
I’d also like to specifically list classes that I can recall off the top of my head that were simply rehash:
-English 1
-English 2
-College Algebra
-Accounting 1
-Humanities
-Biology
At $450 per credit hour those classes alone were $8,100 of wasted money.
“Rehash”
Actually, a test of what you “really know”, before they start you on the “real” degree.
To understate it, the quality of public education varies. A lot.
A test of what you know is the ACT and SAT. Try again.
Sounds like you went to a crummy college. Why on earth did you have to take algebra again in college? The only algebra classed offered in our math department were Abstract Algebra and Advanced Abstract Algebra. It was 100% proofs about groups and rings and fields and similar areas of theoretical mathematics. Tough classes too. The prof was a hoot.
I think there was a remedial class, but almost no one had to take it and even it was mostly just slowing down the first calculus class so it took two academic quarters with a quick review of trig for the first few weeks.
The first English class I took in college was a Shakespeare seminar with only 16 students in it. Then again, I learned to write in high school.
Crummy college? Regional accreditors are the ones who review and approve the curriculum. Every business program that I entertained required Algebra.
I took algebra again in college and trigonometry. I figured that my high school was so poor that I had better try to start a bit lower. I went on to Calculus, Advanced Calculus and B.A. in Math.
Friend of mine who jumped into Calculus first ended up in a real struggle. A found that these math classes at 8:00 in the morning were alot of fun. I just took a math class every semester at 8:00 in the morning until I graduated in the 4 year plan.
Learning can be fun. Some students get confused and thing college should be fun with drinking and parties.
I enjoyed learning and my college days were great fun because of that.
My history professior was retired military and only gave essay tests. Just a wonderful experience so I took two history courses just to listen to him. Go ahead and ask me about the Reformation.
If you judge the quality of a college based only on its ability to eke out an accredidation, you aren’t looking very closely.
I never judged a college based on accredidation alone. Higher education in general regardless of institution has been broken for a very long time in my humble opinion. Telling a young person that they’ll need to go into tens of thousands of dollars in debt just to make a living is flat wrong.
“required Algebra”
I just don’t understand why you couldn’t place out of this course. I was able to take Algebra in 7th grade and couldn’t imagine having to sit through that all hungover! Sitting through Calc II first semester because I flailed on the placement test was bad enough…
Sure, I could have take the CLEP tests. Still have to pay…
We got tested by the college for “free”, heh.
Thank god I didn’t pursue the MBA program few yrs ago. I have been admitted to few top 20 programs. Decided not to attend at the last moment. I would have been drowing in debt for rest of my life in this job market.
I don’t need more than a high school diploma and a state sanctioned license for what I do. I got my BBA because it was the thing to do and my MBA for personal enrichment. I can tell you from experience that I actually took a lot away from my MBA program. I learned how to do a keg stand in my BBA program!
Thank god I didn’t pursue the MBA program few yrs ago. I have been admitted to few top 20 programs. Decided not to attend at the last moment. I would have been drowing in debt for rest of my life in this job market.
There’s a new book called The Personal MBA that says the same thing.
I thought that the author’s “Don’t get an MBA!” advice was sound, but his coverage of the MBA-level skill set droned on and on. I went into skimming mode long before I finished this book.
Specifically, lax lending standards and artificially low interest rates for government subsidized loans exacerbate tuition increases,
Interest rates shouldnt’ matter for a student loan. Colleges aren’t able to take adavantage of a lower monthly payment to raise their tuition prices because students don’t have to start paying that (lower monthly payment) loan back until nine months after they graduate.
It’s the maximum borrowing limit that pushes up tuition.
“It’s the maximum borrowing limit that pushes up tuition.”
Combined with wasteful university spending. If employers didn’t help perpetuate the higher education machine, tuition would necessarily drop.
While I agree that tuition has been increasing faster than inflation for many years and that student loans have contributed to this, future tuition hikes are going to have as much to do with the sorry condition of state budgets.
The recession has also increased demand for higher education (including more technical programs at community colleges) as people try to develop marketable skills. The law of supply and demand would lead to a conclusion that this also will contribute to future increases.
Cal State Fullerton students sit in for second day
April 19, 2011 | 12:07 pm
Students at Cal State Fullerton are staging a sit-in outside the offices of President Milton A. Gordon and are refusing to leave unless he signs a document they’re calling “a declaration to defend public education.”
The protest began Monday with about two dozen students from the Fullerton campus and Cal State Dominguez Hills staying overnight in Langsdorf Hall, the main administration building. The students have been peaceful, and there have been no arrests, officials said.
…
Students and faculty at all 23 Cal State campuses held rallies, marches and sit-ins last week to protest rising tuition and state funding cuts to higher education.
…
They should check out the tuition at some of the local private schools. Cal State, even with higher tuition, is one of the best bargains in the nation.
That’s not the point. The point is that all tuition has been skyrocketing for a decade. It’s unaffordable and that ain’t right.
Op-Ed
Cuts to higher education: The Master Plan turncoats
Some of the same state legislators who benefited from the higher education system now won’t act to keep it whole.
April 17, 2011|By Gene Block
Early this year I was asked, as the chancellor at UCLA, to prepare the campus for nearly $100 million in budget cuts. It was our share of the $500-million reduction proposed for the University of California system in Gov. Jerry Brown’s budget proposal.
And that’s the good news.
As we all know, more extreme reductions lie ahead because of the state’s budgetary crisis and political stalemate. The governor has attempted to forestall those further reductions by asking voters to approve extensions of several state taxes, taxes that Californians already pay. Thus far, there are not enough legislators to support putting the extensions up for a vote on the June ballot.
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Can anyone who knows the underlying purpose of this twelve step program please offer comment?
Press Release
April 18, 2011
External Affairs Branch
(916) 795-3991
Patricia K. Macht, Deputy Executive Officer
Contact: Brad Pacheco, Chief, Office of Public Affairs
CalPERS Adopts Federal Legislative Priorities Underscoring Commitment to Defined Benefit Plans
SACRAMENTO, CA – The California Public Employees’ Retirement System (CalPERS) Board of Administration recently adopted a 12-point set of federal legislative policy priorities that at the core underscores the Fund’s commitment to preserving defined benefit retirement plans.
The priorities – that will serve as a road map for advancing CalPERS federal governmental goals on retirement – outline CalPERS positions on retirement benefits, funding and accountability of pension plans, and Social Security.
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California’s Democratic governor targets public pensions
Tuesday Apr 19th, 2011 10:44 PM
Although pensions for public employees amount to only four percent of the state budget, both parties are using the budget crisis to demand deep cuts.
California’s Democratic governor targets public pensions
By David Brown
19 April 2011
At the end of March, the latest round of budget talks between Democrats and Republicans in the US state of California broke down despite general agreement on cuts to social spending. According to state Republicans, pension reform is the sticking point. Although pensions for public employees amount to only four percent of the state budget, both parties are using the budget crisis to demand deep cuts.
To take the initiative against Republicans, Governor Jerry Brown released seven proposals for pension reform. True to form, they overwhelmingly target the working class, and closely mirror the Republicans’ demands. These proposals come on top of $8 billion already signed into law by Brown earlier this year, including sharp cuts in education and health care spending.
Four of the seven points are aimed at supposed “abuses.” He would end “airtime,” where an employee can pay a fee to have benefits calculated as if the worker had worked for up to five additional years. Brown is also targeting “pension spiking,” a term used attack workers whose wages increase in the later years of employment, resulting in a higher calculated pension benefit. Benefits would be calculated on the basis of a three-year instead of one-year average and only include base pay. The governor would also remove benefits for those convicted of felonies relating to their employment.
Brown’s other three proposals target the entire public workforce, whether they will receive $20,000 or $200,000 a year. These are: the proposed prohibition of pension holidays, when no contribution is made to the fund when the system is overfunded; the prohibition of employers making employee contributions for the employee; and the prohibition of any retroactive pension increases.
Together these three do nothing to close the funding gap. Instead they would only make it harder for pensions to increase if the economy improved. Essentially they are designed to cement the $700 million in concessions the unions made last year in bargaining with former Republican Governor Arnold Schwarzenegger.
…
“Four of the seven points are aimed at supposed “abuses.” He would end “airtime,” where an employee can pay a fee to have benefits calculated as if the worker had worked for up to five additional years. Brown is also targeting “pension spiking,” a term used attack workers whose wages increase in the later years of employment, resulting in a higher calculated pension benefit. Benefits would be calculated on the basis of a three-year instead of one-year average and only include base pay. The governor would also remove benefits for those convicted of felonies relating to their employment.
Brown’s other three proposals target the entire public workforce, whether they will receive $20,000 or $200,000 a year. These are: the proposed prohibition of pension holidays, when no contribution is made to the fund when the system is overfunded; the prohibition of employers making employee contributions for the employee; and the prohibition of any retroactive pension increases.”
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Believe it or not, as a staunch supporter of public unions and defined-benefit pension plans…I concur, wholeheartedly, with Gov. Brown’s proposals here.
As a staunch opponent of public unions I’m shocked an amazed at these proposals coming from a liberal. I guess everyone has to accept the painful truth eventually.
I have no issue with public pensions as long as employees contribute to those pensions and there are safe-guards against double dipping.
They do contribute to those pensions. As for the “double-dipping” issue (especially as it pertains to the DROP program), it can actually cost the govt LESS to hire someone who is already receiving a pension.
I agree. All those proposals sound reasonable.
That’s why I voted for Brown (besides my desire to avoid giving Gollum Sucks an opening in CA state politics).
All those proposals sound reasonable.
Yep.
I’ve been suggesting only including base pay as a part of state pension reform on this board for months. It works in the federal system very well.
I have to agree those changes sound reasonable, as well.
This is the vision of someone who does not have a political axe to grind with public employee unions. It is policy that is not out to destroy political opponents, but is designed to reign in costs and increase fairness.
Contrast it with policy in Wisconsin and Ohio, which are primarily designed to destroy political opponents under the guise of controlling costs.
Funny how all of us “libs” here can agree with govt cost-cutting when it’s done in a fair and reasonable manner.
This is how it’s done — fairly, responsibly, and without all the emotional rhetoric that accompanies the right-wing “fixes” for our economy.
Public union goons are getting hammered on all fronts.
Those cities/counties/states that do away with public unions will survive and thrive one day. Those that keep their public unions will never recover. They will be shells of a city (think Detroit) that collect huge amounts of taxpayer money and funnel nearly all of it to their public union benefits/pensions.
——————————–
Oklahoma Senate approves collective bargaining repeal
Oklahoma House Bill 1593 repeals a 2004 law that requires cities with more than 35,000 residents to grant collective bargaining rights to nonuniformed city employees.
BY JOHN ESTUS Oklahoman
April 19, 2011
The Senate on Tuesday sent Gov. Mary Fallin a bill that would strip collective bargaining rights from city employees in Oklahoma’s largest cities.
Oklahoma Senate approves collective bargaining repeal House Bill 1593 passed Tuesday on a 29-19 vote supported entirely by Senate Republicans.
The bill would repeal a state law granting collective bargaining rights to nonuniformed city employees in cities with populations of more than 35,000.
http://newsok.com/article/3560080
American workers
Public union goonsare getting hammered on all fronts.Fixed it for ya.
With the pension deals of the past 15 years, the public employee unions have stealthily become much richer at the expense of everyone else, while hiding the cost. It was very unfair for those who are living longer to also retire earlier on more favorable terms, while choosing to shop at places that provide no retirement or heath care at all to improve their standard of living.
It’s the theives and the theives. It’s those who have seized control of institutions and are destroying them vs. everyone else. Next thing you know, CEOs will be claiming to be exploited workers.
Somehow this argument that “We’ve got to screw the public employees, because the private sector employees have been screwed even worse” just seems counterproductive to me.
In the meantime, the people/companies that are the only ones that seem to have any money keep threatening to take their ball and go home/go elsewhere, if the rest of us don’t bend over and bring our own Astroglide. Then when they are done, they go home anyway.
A nation cannot survive on McJobs.
The public unions people didn’t get richer, we got poorer.
So let’s make them poor as well, eh? Brilliant plan.
More so let’s destroy one of the few organizations that fights for the middle class, and thus hand that much more power to the corporations that are bleeding this country and out democracy dry.
It’s a balance of power issue the middle class has absolutely no power. We are getting poorer and becomeing less organized and fragmented by the MSM. The elite are consolidating power and wealth and forming PACS and think tanks and buying upt he msm and our politicians. If you think that this story ends well you are mistaken. Al ost every one on this board and many members of the top 1% depend on a strong middle class. Many at the top wh oconsider themselve rich will loose their wealth as well.
I agree with your sentiment in general. I am NOT in the teacher’s union, but I don’t like the war on teachers. That being said, there are some ridiculous things happening that I would like to see abolished.
* rubber rooms
* DROP (where you get to “retire” and keep working because you’re “impossible to replace”).
* Last in, first out layoff policies that ignore performance
The thing is, I don’t agree with merit pay either, and I do think experienced teachers need protection from the “fire the most expensive” type admins. Also, science teachers need protection from the hellfire crowd.
In short, it’s a clustercrunk currently being argued by extremists, and that’s really, really annoying.
Added to the closure of Borders and other quasi-public spaces where literate people like to congregate, it appears America supports a dwindling amount of critical habitat for literate people.
Posted on Tuesday, April 19, 2011
Book bind: Public libraries feel strain of budget cuts
LIBRARIES
Steve Kline stands in front of the Bascom Library and Community Center in San Jose, California. Budget problems have kept the city from opening and staffing it. | Nader Khouri / MCT
By Tony Pugh | McClatchy Newspapers
WASHINGTON — They’re the lone source of free computer and internet access in most communities, allowing the unemployed to search for jobs, learn computer skills and spruce up their resumes. Millions use them to stay in touch with relatives, apply for government services or to seek health information.
But public libraries’ critical role as neighborhood information hubs hasn’t shielded the nearly 17,000 of them across the country from budget scalpels.
After spurring a surge in public library use nationwide, the tough economy is forcing many branches to cut staff, hours and programming right when many cash-strapped people need them most.
As in previous downturns, Americans turned to their libraries during the Great Recession for free children’s programming or to borrow books, movies and music. In 2008, when the economy was in freefall, a record 68 percent of Americans had a library card, and library visits and borrowing spiked as well.
However, a whopping 72 percent of public libraries reported budget cuts this year; 43 percent cut staff as well, according to a recent survey by the Library Journal.
…
Our local library is expanding. Of course the city saved for years to fund its expansion instead of merely borrowing money.
Oh, and no juicy pensions for the library (or city staff) for that matter. Just 403(b)s (except the cops and firefighters).
Wonder how may libraries you could keep open for the cost of just three $200,000/year firefighters who retire at age 50 with 90% pensions (spiked, of course) and a “disability”…?
Ours aren’t paid quite that well. The best paid muni employee is the city manager, and he gets about 200K. IIRC the average firefighter and cop out here gets about 70K. And I think our guys don’t get their pensions until they’re 60 (still a nice deal).
The library director is paid 80K. and the average librarian (not a clerk) is paid about $20/hr.
Don’t confuse him with the facts.
You don’t “learn computer skills” by playing on the Internet and using Word to do a resume. That’s like saying you can learn to be a mechanic by driving a car.
Computer skills are learned by taking computers apart, reading books, installing operating systems and programming.
Computer skills like Word/Excel (and turning it on/off) are just a “basic life necessity” to function in the workplace. Kind of like knowing how to use a cell phone or knowing how to drive a car to get you to work.
Cracks me up how parents think that kids playing on Facebook is going to result in a high paying computer job someday. Back when I was a kid, that was actually the case (we had to write a program if you wanted to play a game; you had to make the entire thing up or code it in before you could play). Now a computer can be as “mind-numbing” as watching TV, there’s no specific skill required to use Facebook or play on the Internet.
Computer work has actually gotten dramatically more interesting in the past 10 years, but it’s also gotten so it’s entirely removed from what most “users” do on a day to day basis. If you want to learn marketable computer skills, don’t go play on a computer in a library. Buy a computer and install VMware (or Linux) on it. Start playing with the technologies that big enterprises use; those are the in demand skills. Word/Excel are simply “assumed” to be there.
The computer is a lot like TV. For adults, on forums, it is slightly more interactive, and it does make you think. So it’s like what talk radio was supposed to be, instead of just a forum for the host, who allows on selected callers.
But for kids, on Facebook, playing games - it’s just a glorified combination of talking on the phone and watching TV.
I agree for the most part, Overtaxed, but you aren’t going to find VMware or Win Server X or SAP or RedHat Enterprise in the average house.
Nor Maya, 3D Max or Autodesk or CS5.
Nor large scale web servers or high end Cisco or Juniper equipment.
Heck, half of this nation still doesn’t HAVE an Internet connection, let alone DSL, let alone a small home network.
So self teaching is not even an option.
VMWare’s Workstation is an awesome tool. I don’t know if I would think of it as a “skill” however.
“VMWare’s Workstation is an awesome tool.”
Agreed. We have a honeypot at work, which has netted several interesting prowling techniques.
Ain’t the recovery grand?
State’s financial crisis could cut off funding
By Christina Villacorte, Staff Writer
Posted: 04/18/2011 10:56:47 PM PDT
Updated: 04/18/2011 11:10:27 PM PDT
Work continues on the Orange Line project along Canoga Ave. in Canoga Park, Calif., April 15, 2011. (Andy Holzman/L.A. Daily News)
The Metropolitan Transportation Authority and other agencies could run out of money to complete the San Fernando Valley’s Orange Line bus extension and the 405 Freeway widening project because of the state’s budget crisis, officials are warning.
The future of those two projects, along with the first phase of building the Expo light-rail line, relies on the sale of state bonds that were approved by voters in 2006.
But Gov. Jerry Brown and state lawmakers already have canceled one round of bond sales scheduled for this spring and L.A. County officials fear that another round planned for the fall could be put on hold, too, if a series of state tax extensions are not approved by voters this year.
Together the two bond sales would have provided about $573 million to L.A. County.
“We have three projects which are at risk right now,” Metro CEO Art Leahy said during a recent strategy session with transit officials.
“One is the 405. It’s not at imminent risk, but at some point, if (state) bonds aren’t sold, we’re going to have to think about demobilizing that project.”
…
You know what? After years of being totally unimpressed with most politicians, I think Jerry Brown is pretty exciting. So far, he’s on the right track, IMHO.
I agree, CA renter. After the fiscal disaster Arnold Schwarzenegger left us with, I have nothing but admiration and support for Jerry Brown, for even wanting to attempt to get us out of this mess. So far, he is showing some good sense. The verdict will be based on how he handles the opposing forces.
I think he is old enough to know that even making a start on fixing things in California will be a great legacy. It is probably liberating for a pol to be doing the work just for its own sake, not for trying to get the next job.
Very true, polly.
JP Morgan ends its bets on Spanish and Italian debt
by Sarah Miloudi on Apr 20, 2011 at 09:44
Investment bank JP Morgan has closed its overweight debt plays in Spain and Italy as the two countries re-couple with the Greek debt drama.
It comes as both Spain and Portugal prepare for fresh debt issues today and after peripheral spreads have widened sharply over speculation a near-term restructuring of Greek debt looks imminent.
Spain is viewed as particularly vulnerable if this scenario eventually plays out as over the past month its spreads versus the German benchmark have re-traced two thirds of their previous gains.
Although JP Morgan bankers say that a restructuring of Greek debt makes little sense, peripheral yields may continue to tighten and erode liquidity even further, and this fear has prompted it to close its longs in Italy and Spain, favouring a more neutral stance.
‘The trend of Italy and Spain de-coupling from the three high-yielding peripherals (Greece, Ireland, Portugal) abruptly reversed this week. All peripherals widened sharply, moving out in concert,’ JP Morgan Securities’ Pavan Wadhwa and Fabio Bassi explained.
…
I wonder how much old JP lost on this bet.
i wonder what this article is really saying. disclosure: i have very little financial industry experience outside of my household.
Eurozone crisis escalates on Greek debt fears
Donia O’Loughlin
FTAdviser
Published Wednesday , April 20, 2011
Greece’s debt restructuring worries has sparked fears among some analysts that other indebted countries will also default on their debt.
Greek borrowing costs hit fresh eurozone highs yesterday (19 April) amid warnings that yields will rise further due to growing expectations Athens will be forced to restructure its debt.
Greek three-year bonds jumped to 21.37 per cent and the probability of a default by Athens in the next five years rose to 67 per cent, as evidenced by credit default swaps. The probability was priced in at about 55 per cent a month ago.
Yields on longer-term Greek debt have soared and commentators predicted that yields will continue to climb as the average price of Greek bonds remains at about 70 per cent of par.
…
Greek three-year bonds jumped to 21.37 per cent and the probability of a default by Athens in the next five years rose to 67 per cent, as evidenced by credit default swaps. The probability was priced in at about 55 per cent a month ago.
Three year bonds at 21% interest rate?!
Greece has defaulted. It is just a matter of timing (weeks to a few months).
No country (including America) could survive.
Default already. Give the German banks their haircuts. Revert back to a local currency. Live within your means.
WHAT? I thought the Europeans were more advanced and not stupid like Americans. That can’t be true. No way.
Is you too-big-to-fail or isn’t you?
REVIEW & OUTLOOK
APRIL 20, 2011
None Dare Call It Default
Better an orderly restructuring in Greece than a Lehman re-run.
For nearly a year, Europe’s official refusal to acknowledge even the possibility of a Greek debt default has bordered on the comical. But with Greek two-year bonds yielding 20% and credit-default swaps priced as if a default is more likely than not, EU denial has gone from amusing to dangerous.
Media reports this week have cited Greek, German, EU and IMF officials anonymously admitting the obvious: Even if Greece meets the targets agreed in its bailout package, it will be saddled with a debt burden that is unsustainable, which makes a restructuring of those debts, now approaching 150% of GDP, inevitable. All these reports have so far been met with strenuous denials from spokesmen and other officials.
Behind these official denials lies a more sophisticated narrative that says a default or restructuring would hurt so many institutions that might need their own bailouts that relieving Greece of some of its burden will do more harm than good. According to this argument, it would be better for Greece to continue to muddle through for now on EU and IMF life support than to expose creditors, including Greek and other European banks, to potential losses on Greek debt. We could add a third argument, which is that openly discussing debt restructuring might make it inevitable, leading to capital flight.
As the Greek flag flies on Tuesday, Greece had to pay a higher rate to raise €1.65 billion amid fears the government will have to default on its massive debt load.
None of this is persuasive. With debt yields on Greek bonds at record highs, the market has already priced in the likelihood that Athens will never make good on its obligations on time and in full. At this stage, it makes more sense to inform taxpayers, investors and governments about where the exposure and risks lie, which is why it’s vital that Europe’s current stress tests look carefully at sovereign-default scenarios. If Greece must restructure its debt—and that seems very likely—better that it do so in an orderly fashion than to wait until its hand is forced.
The conventional wisdom about the collapse of Lehman Brothers is that the worst of the financial panic could have been averted if only Lehman had been saved from going under. That wisdom is wrong. Lehman’s collapse triggered a full-blown crisis in no small part because investors had little clarity about who was solvent and who wasn’t, and who would be saved and who would be left to fail.
…
UPDATE 1-German govt adviser sees Greek debt restructure ahead
Tue Apr 19, 2011 6:46am EDT
* Advisor to Germany says Greek debt will be restructured
* German public bank assn says haircut not end of world
(Adds details, comments from banking association)
BERLIN, April 19 (Reuters) - Greece’s extremely weak balance sheet means a restructuring is inevitable, an advisor to the German government said on Tuesday, as Germany’s public banks said such a move would not be a catastrophe for the sector.
The statements are the latest sign of conviction in the EU’s dominant economic power that Greece’s 110 billion euro EU/IMF bailout will not allow it to avoid renegotiating its debt with creditors, despite denials from officials across Europe.
Clemens Fuest, who chairs the German finance ministry’s technical advisory committee, told Reuters that Greece could barely manage to tread water since half the country’s tax revenue must now be spent simply on meeting interest payments.
“One must recognise the realities — I am expecting a haircut,” the economist said. “(The interest payments) are breaking Greece.”
…
The Detroit News
Daniel Howes
In budget crisis, U.S. faces fate of Michigan
Last Updated: April 19. 2011 12:57PM
The United States of America got another wake-up call Monday, courtesy of Standard & Poor’s.
In a statement as jarring as it was predictable, the ratings agency downgraded to “negative” its outlook for the country’s Triple-A credit rating and signaled further downgrades if Congress and the White House cannot craft a credible debt-reduction and growth policy.
“We believe there is a material risk that U.S. policymakers might not reach an agreement on how to address medium- and long-term budgetary challenges by 2013,” S&P said. “If an agreement is not reached and meaningful implementation is not begun by then, this would in our view render the U.S. fiscal profile meaningfully weaker than that of peer ‘AAA’ sovereigns.”
Translation: If the politicians don’t start acting like economic grown-ups instead of political adolescents, the global financial markets that fund its profligacy will ensure the United States becomes a second-tier nation on their watch. Doesn’t matter that it’s just too hard for them to do what’s necessary.
We’ve seen this movie before, America, here in the Epicenter of Entitlement. In May 2005, ratings agencies downgraded the debt of our cornerstone companies — General Motors Corp. and Ford Motor Co. — into junk territory and we shrugged. The same year, Delphi Corp. filed for bankruptcy, prompting Michigan’s governor and the head of the United Auto Workers to complain. The rest? No biggie.
For years, leaders in Detroit ignored the signs — from credit ratings agencies and budget analysts, from sales figures and quality surveys, from parents who pulled their kids out of the city’s schools, hastening decline, from corporate types who warned of a hostile business environment and a culture of corruption.
Whatever can be said of Michigan, its largest city and its defining industry — poster children, all, for the fraught decline of industrial America — none is more true than the simple fact that too many for too long denied the facts of deep, unsustainable rot because denying them was easier and more familiar than confronting them.
…
The global financial markets that fund our profligacy actually depend on our profligacy, and that ain’t gonna last.
Very true, Big V.
Fed Proposes Minimum Standards for Home Loans.
http://blogs.wsj.com/developments/2011/04/19/fed-proposes-minimum-standards-for-home-loans/
Wake me when they fill in the details.
I believe there is something in there about making sure the borrower has the means to repay the loan.
How did they come up with this kind of crazy notion?
And just to play the devil’s advocate here, what happens when the self-employed folks need a loan for a house? As someone who is self-employed income varies wildly.
The private market did a fine job before government got involved to tell them that EVERYONE needed a house of their own. The self-employed had to put more money down and typically had a slightly higher interest rate.
Let’s hold the banks accountable, but let’s do it by having them keep their own paper. Banks tend to be conservative with their own money.
“As someone who is self-employed income varies wildly.”
Isn’t that the purpose of stated income loans?
That’s exactly the purpose of a stated income loan. Unfortunately when we start to have legislated loan guidelines programs like these have the potential to be cut.
I see this as one of the extremely unfortunate after effects of the subprime lending mania. For a few years there, stated income loans were given to anyone who could breath, without any questions asked. Now the pendulum has swung 180 degrees the opposite direction, so those for whom this product is appropriate don’t even qualify.
A well-functioning private lending system, with the risk of default properly residing with the originator (whether or not they are too-big-to-fail) could deliver these loans to the market with an appropriate risk premium to cover default risk, but given the Fed-funded, government-owned-and-operated system currently in place, it is unlikely to work so well.
Wild swings in income is usually a good indicator that it’s a bad idea to make long term commitments.
Not smart for either borrower or lender.
Which is why I haven’t bought a house. Funny thing, though, is that we have lived in the same rental house for almost 15 years, without missing a rent payment.
Lost decade? We’ve already had one
http://finance.fortune.cnn.com/2011/04/20/lost-decade-weve-already-had-one/
Right; already into the second lost decade, in fact…
Duration. Duration. Duration.
(couldn’t help myself)
BTW - the newspaper here has pictures of a people swarming local Mickey D’s yesterday for job interviews.
Adding to the % of workers earning less than $500 per week.
USA! USA! USA!
Here in Tucson, the local fishwrap has been giving quite a bit of coverage to the Mickey D’s hiring story. Today’s installment:
McDonald’s 1-day job fair draws thousands of applicants nationwide, locally
Much comment merriment follows. Such as:
“Ratio of applicants to jobs = 20 to 1
Lousy jobs, at that. Lots of desperation out there.”
MJobs are back!
http://en.wikipedia.org/wiki/McJob
I’m lovin’ it!
Nice article, nice chart in the article.
Look at the blue line, the one that says “Credit Markt debt”, and notice how it has flattened out. There was a big rise for many years and now that rise has stalled.
The rise of the blue line reflected the money that was borrowed and spent and distorted the hell out of the economy. Now the blue line is not longer rising which means the economy is morphing into a “get real” state where money is getting/has gotten tough to get hold of and tough to keep.
There are many people in our economy whose income depends on the blue line extending upward forever, and now that the line is not doing so these people are screwed.
For example, 60 Minutes a few weeks ago featured a husband-and-wife team that used to make their living detailing cars but now are without income. Detailing cars is a job that pays well when money is easy to get - when the blue line is forever extending upward. Now that the blue line has flattened out the customer base for car detailers has vanished.
The blue line has extened upward for so long that lots of people think the economy as represented by the blue line is one that is NORMAL and will be coming back.
Oh, the pain!
LOL! I was thinking of getting my 5 year old car detailed (a lot cheaper than buying a new one). I haven’t had done it on a car for a few years and IIRC the last time it was about $140 (inside + out, including interior shampooing of fabric.
I looked into it the other day. Most places want $200+. One place even wanted $300.
I guess raising prices will attract more customers.
I washed my car in one of those “bay” places for $4. Not the same thing, but it sure looks a lot better.
You local full service car wash should do it for about $30.
“You local full service car wash should do it for about $30.”
Those were the guys quoting $300.
I’ve never seen a place that will shampoo an interior for $30. At the full service place $30 gets you “the works”, meaning they spray wax on your car as its pulled through the wash.
Wow! My local car wash in a very nice neighborhood will do the “Works” for $30. I still think that’s too high considering I can do it myself. I do it every 3 months.
Every week I wash and vacuum. Wax once a year.
$100+? That’s just stupid money.
Have the “Steamatic” guys do your car when they come out and do you house. Slip them $20 bill.
Shampooing leaves a lot of residue in the carpet that attracts/sticks to more dirt. And you need to be careful about making sure any water under the carpet is dried up.
Paying someone else to do your own Car detailing, really? Pay me $100, I’ll do it.
Car detailing
Dog grooming
Hair cutting
Spa’s
Sporting Events
Eating out
nic-nac shops
New CAr every 2 years
Vacations
The list is endless. No easy money, higher taxes, more job insecurity, inflation of fuel and food. There is just less money to spend on all of these things.
I would have added “dog grooming” to the list myself, except for the fact one of my daughters has been sent by her employer to dog grooming school for a month (on the company’s nickel). Had to sign a year contract, but why not? She likes animals, and it doesn’t appear like the job market is going to be gangbusters during that period of time.
She was hired as a part-timer “washer” back in August, but has been working full time since day one. Evidently, the dog grooming business is doing well locally.
Lots of people seem to be substituting “fur-babies” for real “babies”.
Car detailing
Dog grooming
Hair cutting
Spa’s
Sporting Events
Eating out
nic-nac shops
New CAr every 2 years
Vacations
Who does any of that stuff?? I suppose that we do vacations, but that usually consists of biking to one of the state parks nearby. The campsites are $3-5. We can’t bike anymore until the bambino is at least 1, so that’ll raise costs.
Bunch of maroons…
We can’t bike anymore until the bambino is at least 1, so that’ll raise costs.
Yours Truly did her first bike tour at age two.
It was a rather lengthy day ride with my parents. I feel asleep in the kiddie seat and rested my head on Dad’s back.
I feel asleep…
And the above typo certainly indicates it! I meant to say that I fell asleep.
I was all excited to bike my little one around immediately until I read all the info saying that I couldn’t until he is one. No shaken babies please.
Funny how we all used to do things that didn’t cost anything and didn’t waste a bunch of energy and had a blast with great memories. While my brother is at Disneyland right now with his wife and three girls.
Reality bites consumer confidence: Till debt do us part.
market pulse
April 20, 2011, 9:00 a.m. EDT
Consumer confidence down after S&P report
By Steve Goldstein
WASHINGTON (MarketWatch) — Consumer confidence has slumped since Standard & Poor’s put the U.S. debt outlook on negative and is barely above 2011 lows, according to a report released Wednesday. Since Monday morning, the Rasmussen Consumer Index shows confidence has fallen eight points to 74.4, and a separate poll on investor confidence is the weakest since last September.
…
Wait until gov slashes spending on Medicare SS school loans tax brakes etc. Consumer confidence will reach a new low.
Who needs “consumers” anymore?
More cake?
wow. majority are now reading business news?
US birth rate falls during economic slump: study
(AFP) – Mar 31, 2011
WASHINGTON — The US birth rate fell by four percent between 2007 and 2009, with some researchers blaming the steepest decline in more than 30 years on the dull economy, a study released Thursday found.
Birth rates fell for all women under age 40, with some of the steepest declines seen in women in their peak childbearing years, according to the study by the National Center for Health Statistics (NCHS).
…
File under “DUH”
How much are researchers being paid to document the obvious?
“Researchers discover Sun rises in the East 100% of the time”
“Researchers find that hitting yourself in the head with a claw hammer can lead to concussions”.
Probably about the same as the “economists” who think there is no inflation. (or housing bubble)
CNN recently reported that spending too much time at work can increase your risk of a heart attack.
I’ve always loved that part about Type A’s. You know, the ones who are usually the first to loudly endorse Social Darwinism and call everyone else slackers.
Then they die from heart attacks in their 50s.
Now THAT’S real Darwinism.
Except that by the time they reach their 50s, the type As presumably have in many cases already reproduced themselves…
On Track for $1 Trillion: Student Loan Debt Greater Than Credit Card Debt
Last June, for the first time in history, Americans owed more on their student loans, a record $833 billion, than on their credit cards, $826.5 billion. The amount owed on student loans increases at a rate of about $2,853.88 per second, meaning we’re on track for total student debt to cross the $1 trillion mark sometime this year.
http://www.good.is/post/on-track-for-1-trillion-student-loan-debt-greater-than-credit-card-debt/
We have put our children into debt for $1 Trillion???
A debt that can not be discharged in bankruptcy.
A debt that will never expire.
A debt in which the US Treasury will hunt you down until even old age - - deducting money from any tax return or even Social Security to pay that debt.
For WHAT? So they can work at a $30,000/year job with no hope of ever starting a family or owning anything? They exist to pay their monthly nut of school-loans.
We have made our children debt-slaves.
Insanity.
+1,000
my gf has a niece and nephew going into debt $45k/year to learn to be actors.
nephew flunked out after 1 year so he’s waiting tables and paying on the $45k, niece is into year 2.
Most actors actresses are so DUMB……i have to teach them how to use Godaddy.com and register their own domain names
seriously…just about every actor who wants to do an internet radio show, never even registers their name…and they wonder why being a waiter is their real job.
My old hairdresser spent $15k to learn how to cut hair. And dye it, I guess.
…but the college adimistrators all have fancy yachts so its all good.
I am one degree of separation from the admin at Dartmouth and Stanford. A couple have modest to nice boats. None has a yacht. I think that you meant Wall St financiers AKA Masters of the Universe.
Speaking of yachts…
Given all the pressing needs of the state, it’s good to know that our state lawmakers have time this session for an especially down-on-their-luck group. Not nursing home residents, not schoolkids, not state employees or the disabled. Nope, it’s yacht owners.
Yes, today a House committee discussed giving a tax break to wealthy yacht-buyers. Under House Bill 2187, by Rep. John Davis, a Houston Republican, the tax on sales of boats over $250,000 would be capped at $15,625. For a $20 million yacht, this would work out to a tax reduction of 99 percent. Those buying smaller, cheaper boats would continue to pay the current 6.25 percent sales tax.
Wow. Nice of the Republicans to care so much about paying off our debt. When will people finally vote these idiots out of office?
For WHAT? So they can work at a $30,000/year job with no hope of ever starting a family or owning anything? …..We have made our children debt-slaves.
I know. It really sucks what the super-rich and their union busting, pro-globalization, crony-capitalist, “free-market” fascist tools have done to our country and our children.
But maybe they’ll get lucky and get one of the few union jobs left.
Sounds like it might be high time for more people to really start to question the expectations and assumptions of postwar American society (like an unquestioning and slavish devotion to “education”). Call me silly, but it just might be that some of the things that worked 1950-2000 might not work as well 2000-2050.
BTW - I agree with Mr. Twain - travel is the best general teacher. As for tech, you’re either curious and intuitive or you’re not - can’t legislate technical aptitude.
But.. but… but… almost everyone i meet who was born in NYC, never traveled father then New jersey!!!!
I agree with Mr. Twain - travel is the best general teacher
What is certain is that the American “go out of town and live on campus for 4 years” college experience is expensive, inefficient and obsolete. No one else does it. Foreign colleges don’t have residence halls, cafeteria, fancy gyms, student unions, athletic programs, etc. And in many countries a Bachelor’s is earned in 3 years (no general ed requirements, you are expected to learn that in high school).
In many countries a college campus looks a lot like a big high school or a community college.
Much like our health care system, our higher ed system has been gold plated and is uncompetitive with the rest of the world.
In many countries a college campus looks a lot like a big high school or a community college.
Yep. In Rio they look like a 14 story office building crammed between two 15 story apartment buildings.
When I describe American college life and show a Brazilian pictures of my old university campus they drool in puzzlement.
In many countries a college campus looks a lot like a big high school or a community college.
I can speak from personal experience on that one too. Universidad de Valencia was a pretty bare-bones place compared to the University of Michigan.
One big difference: Spanish taggers were running wild in the late 1970s. On campus, they’d spray paint walls, desks, floors, anything that was stationery.
In dear Ann Arbor town, on-campus graffiti was rare and quickly cleaned up.
When I describe American college life and show a Brazilian pictures of my old university campus they drool in puzzlement.
Ditto in Mexico. Even the sprawling UNAM in Mexico City lacks dorms and such. Most Mexican universities were much more spartan, and some were similar to the Brazilian schools you described: crammed into a 10 story building, and you rode the Metro to get there. Some private schools had campuses with gardens and parking lots, but no dorms, no athletic programs, etc. You came in, attended your classes and labs, and then got the heck out. Even the school libraries were a joke.
The environment was very vocational. There was no talk of being “well rounded”, you were there to be trained for a profession: accounting, engineering, biz admin, law, medicine, etc.
College degrees are great. All you need is actual jobs to employ your degreed youth. And, much like houses, they begin to lose value when they COST TOO MUCH.
The answer may be some off the wall idea like:
DON’T TAKE OUT STUDENT LOANS!
Figure out some other way to achieve your goals. I guarantee that you will evaluate your goals in far greater detail when you pay as you go.
For one, I am greatful that I went to college during a time when education was still afforadable. Tuition in 1988 at NC State was $484/semester and I thought that was expensive.
A few things you might want to consider these days:
1. Can I get a well paying job with the degree I pursue? If not it is a very poor investment.
2. Can this job be easily outsourced or made obsolete? If yes, don’t do it!
3. Don’t waste your money on fancy private schools if you can get the same education at public universities for a fraction of the cost. There are very few exceptions (MIT, CalTech, Yale, etc.) that are worth the extra expense.
4. You might wat to pick a school and move to that state and work for one year to become a resident for tuition purposes. I did that.
5. Be sure you will finish what you started. It’ll be awfully hard to pay off student debt from a failed college career working odd jobs.
6. If you’re simply looking to make a living, there are other high paying jobs that don’t require a college career. The damn plumber
charged me $150/hr to wrestle some turds out of my sewage pipe.
7. Consider leaving the US after you get your degree and stiffing the bill collector. A country that has a for profit education system doesn’t have much of a future anyway, time to bail.
What happened to going to college to learn?
When did it become a vocational institution any how?
In the 1980s.
My oldest went to college for a year, then got a job working for Old Navy.
She’s now an assistant manager at another “nationally known” store, in line to become a store manager. She’s not doing to bad, considering……
She has clerks with Masters Degrees working for her (@$10/hr).
Which illustrates what is screwed up with this country.
Have your kids go for a pro-athletic career, Yale or Harvard to be a bankster, or try out for “American Idol”. If you are in any other kind of occupation, your ultimate destiny is to be a drone.
My college-degreed sister should have stuck with her job at Old Navy. She is currently being offered 35-hr-per-week “part time” jobs with no benefits paying $8 an hour. Unbelievable. Of course this is in Florida, where pay is low and opportunities exist only for large corporations with big money to donate to the crooked governor.
Speaking of which, Disney has been blowing their horn, claiming to contribute 18 billion to Florida’s economy.
http://www.orlandosentinel.com/the-daily-disney/os-disney-economic-impact-20110413,0,7480432.story
Mickey wants his gubmint cheese!
Cheapest houses in 40 years!
http://realestate.yahoo.com/promo/home-ownership-declining-despite-cheapest-prices-in-40-years.html
“Falling prices have made real estate the best buy in at least four decades. Housing affordability reached a record in December, according to National Association of Realtors data that go back to 1970. The group bases its gauge on property prices, mortgage rates and the median U.S. income”
Coincides with the most pinched housebuyers in 40 years. Neat how that works out.
Also the most fearful buyers. Who wants to lock themselves into a mortgage contract to purchase a money pit when job security is a ginormous question mark?
Cash is king. The cash buyer picking up on property priced at early 1990’s levels can be confident in their purchase decision. Those still taking mortgages on homes priced at 2002 levels should be fearful.
Not in NYC. I might as well be living in Shanghi.
There is just enough froth to convince sellers to hold out for near peak prices, and enough Wall Streeters willing to cave to generate some sales.
My house is still 25-40% overpriced, based on the few sales going through.
NYC, and many parts of CA don’t follow traditional rules. You couldn’t pay me enough to live in either place.
“Not in NYC.”
Ditto in CA. Market manipulation rules.
Friend called just now is making an offer on a 1700 square foot house in Phoenix 160K it has a 12K sized lot
I doubt 160K would buy a 900 square foot condo in Moorpark CA ?
supply and demand ?
Again, bullcrap.
Yesterday, LPS put out their brief on the data for March (in advance of their bigger “Mortgage Monitor” due on April 29th).
The main headline is that the delinquency rate is down to 7.78% in March, from 8.8%, and the percent of loans in the foreclosure process is 4.21%, up slighly from 4.15%.
As of the end of February, there were 6.856MM loans either delinquent or in the foreclosure process, as of the end of March, there were 6.333MM.
The main drop appeared to be with new delinquencies, with the fall in 90+ day and foreclosure totals representing about 30% of the reduction, with 70% of the reduction being in newer delinquencies.
Housing ‘recovery’ continues, even though existing home sales are 6.3% lower than a year ago. How exactly does that work?
Anyway, no reason to fathom the unfathomable: Get out their and scoop yourself up some amazing housing investment deals of a lifetime while the scoopin’s good.
‘Uneven’ housing recovery continues
By Annalyn Censky, staff reporter
April 20, 2011: 11:02 AM ET
NEW YORK (CNNMoney) — Sales of existing homes increased in March, “continuing an uneven recovery” in real estate, an industry group said Monday.
Home sales rose at an annual rate of 5.1 million in March, up 3.7% from February, the National Association of Realtors said Wednesday. However, sales were 6.3% lower than in March 2010.
Government reports released a day earlier showed new home construction and permits for future construction both ticked up in March.
Those reports are not bad, but not great either. Despite slight upticks in home sales and construction, the housing sector is still in the doldrums as supply continues to far outweigh demand for homes.
“Even as buyers scoop up deals of a lifetime, the river of foreclosed properties continues to flow,” Douglas Porter, deputy chief economist at BMO Capital Markets, said in a note to investors Wednesday morning.
…
How is President Trump going to clean up and undo the four years of mess caused by the Obama administration? How, Professor Bear, just how?
Donald’s Trump career has shown he is very good at three things.
1) Inheriting money from a hard working, succesful father. A guidepost to our future as a society, replacing the merit system.
2) Self promoting. He was social networking before there was such a thing.
3) Going bankrupt and stiffing creditors while remaining rich. No one has failed more succesfully than he has.
President Obama may or may not be able to turn around the destruction of our institutions due to Generation Greed the old fashioned way. But Trump may be the man in tune with contemporary American values — and be able to keep the party going a few more years by picking through the bones.
I don’t want you to think that I’m a Trump supporter because that’s laughable. That said, President Obama is the one trying to keep the party going. No president in the last 20 years has been better positioned to make dramatic change. Unfortunately he’s proven himself to be more of the same. The Lybia ordeal combined with failed campaign promises on Iraq, Afghanistan, and Guantanamo has led me to believe this is no more than the 3rd Bush term.
Well, the decision was made just before he took office, although he agreed with it. If the economic collapse had been allowed to continue, we all might have been much worse off for the past two years. But most might have been better off going forward.
So I take it you are all for TBTF and all the requisite bailouts and bankster handouts that went with not being “much worse off”?
And let’s not forget the continuation of crony capitalism…..
I agree and I voted for O. Wall St is too powerful, it doesnt seem to matter who is president.
ten-four. plus 0ne.
+ a trillion
He’s not even worth a billion but he loves to be called a billionaire. He fires people on TV without even hiring them. I read somewhere that he was close to suing Forbes for “underestimating” his net worth. And get this, most billionaires wanted to downplay how much they worth but not our President Trump. That tells all you need to know about this guy.
Many years ago, when I was a University of Michigan student, I took a creative writing class with Terry Gamble. Girl could write the rest of us under a table. She was that good.
You might have heard of her family’s company — Proctor & Gamble. But she wasn’t the type to lord over the rest of us, even though she was set for life and one of the best writers in the class.
I occasionally see her name in Michigan alumni publications. She went on to be a writer, and due to her good fortune in life, she can do it full time without having to make a living.
BTW, I’ve heard that her books are pretty good.
I had a bad dream last night.
I was standing in front of a large group of people who were all telling lies to each other in German. It was then that I shouted Ich bin ein Realtor! They all stood, extended their right hands and cheered. Startled and realizing I was in the middle of a Nazi Realtor rally I tried to run, but I kept slipping on Notice of Lis Pendens and short sale contracts. As the crowd bore down on me carrying torches and shouting “They`re not making Father Land anymore” I woke up in a cold sweat.
Awesome! Please share more of your dreams here…
“Awesome! Please share more of your dreams here…”
My 26 year old seventh grade math teacher Miss Barlow asked me to stay after class… Oh forget it.
For every bad dream … there is a good one.
Wells Fargo Shares Slide as Revenue, Lending Decline
~ Bloomberg
Wells Fargo & Co. , the largest U.S. home lender, fell as much as 6.2 percent in New York trading today after reporting first-quarter results that included lower revenue and lending.
Prepare for some layoffs. I am glad that I didn’t take a long term contract position with them last December.
U.S. Existing Home Sales Rise, Fail to Recover Ground Lost
April 19 (Bloomberg) — Patrick Newport, an economist with IHS Global Insight, talks about U.S. housing market conditions. Housing starts gained in March, as work began on 549,000 houses at an annual pace, up 7.2 percent from the prior month, figures from the Commerce Department showed today in Washington.
A gain in sales of U.S. previously owned homes in March failed to make up for the ground lost the prior month, a sign that the housing market is taking time to recover.
Purchases increased 3.7 percent to a 5.1 million annual rate, exceeding the 5 million median forecast of economists surveyed by Bloomberg News, figures from the National Association of Realtors showed today in Washington. The median price declined from a year earlier, and 40 percent of the sales were distressed properties.
Even with last month’s gains, housing may remain a weak component in the economic recovery that began in June 2009 as unemployment, falling property values and stricter loan rules push foreclosure filings to a record level. At the same time, a drop in prices has made houses more affordable, suggesting demand may not fall much more.
“We continue to just tread water along the bottom,” said John Herrmann, a senior fixed-income strategist at State Street Global Markets LLC in Boston. “The housing market is fairly depressed. We think home prices will fall further.”
Blackstone Leads Record Property Push as Buyout Firms Diversify
~ Bloomberg
Blackstone Group LP (BX) and Carlyle Group are leading a record number of private-equity managers aiming to raise real estate funds as the world’s top buyout firms accelerate an expansion beyond corporate takeovers.
Blackstone, the biggest private-equity firm, is planning to raise its next real estate fund, with a target of about $10 billion, later this year. Carlyle is in the process of raising a new fund for U.S. property deals, said a person briefed on the plan who asked not to be named because the fund is private.
The two are among 439 private-equity real estate funds seeking a combined $160 billion, the largest number on record, according to London-based researcher Preqin Ltd. KKR & Co. last month hired its first head of real estate, naming former Goldman Sachs Group Inc. (GS) executive Ralph Rosenberg to the post. The firms are betting they can produce profits in a still choppy market because their capital is locked up for long periods, usually a decade, allowing them to make improvements and wait out short-term price swings.
“There’s a whole world of problems out there and properties need capital to be maintained and to grow,” KKR’s Rosenberg said in an interview. “New capital is going to have to solve these problems, because there’s not a broad liquid market to restructure real estate like there was in corporate debt.”
Why the suddenly resurgent interest in property? Is another bailout in the works behind the scenes to make these gamblers look smart soon?
Inflation hedge.
Opportunities to buy good assets (meaning still relevant in a “normal” economy) at a fraction of what it costs to build new. For example, I know a group that just purchased a new office building at approximately 40% of what it cost to build in 2008. At that price, they can compete with the worst space in the market (offer better space at the same price as crappy space, and entice tenants to move into new digs). Without a recovery (flat rents), they do pretty darn well. If there is any kind of recovery in market rents, they do VERY well.
With energy going up, copper going up, concrete, steel, etc., the cost to build new commercial buildings isn’t going down, and people won’t build until rents justify the cost of construction (i.e. rents are going up once vacancies go down–which they are starting to now).
Said another way. You can’t complete the “buy low, sell high” strategy of investing if you don’t buy low. In today’s market, many commercial properties are cheap by pretty much any measure (historical prices, replacement cost, market yield on cost, etc.).
Another point, I think these groups are betting on NO bailout. They are hoping that banks need to take back property and are forced to sell it onto the market. A bailout will simply keep property values high.
Something is up…
Maybe they are 100% sure about the decimation of the dollar. Can’t say they’re wrong, either.
sounds like how they are driving the oil bubble. inventories are up consumption is low. but demand is higher.
Lost decade? We’ve already had one
~ Fortune ~ April 20, 2011
The economy has been bedridden far longer than we realize — and you can blame lying statistics for at least some of it.
So says Rob Arnott of Research Affiliates, a Newport Beach, Calif., investment management firm with some $50 billion under management. He argues in his monthly newsletter that, contrary to popular belief, the roots of our current malaise predate the financial crisis – and not by a little bit.
Arnott says the U.S. economy actually went off the rails more than a decade ago. What’s more, many of us have failed to realize it because the most widely watched economic indicator, gross domestic product, actually tracks consumption, irresponsible or otherwise, rather than real wealth generation.
Accordingly, Arnott takes little solace in the observation that inflation-adjusted, per capita GDP has recovered to within just a few percent of its 2007 peak. While that statistic suggests the economy is recovering steadily, if a little less quickly than we’d like, Arnott contends that most of the GDP gains we have seen since 1998 are attributable to debt-financed spending, rather than real wealth creation.
We are, in a word, considerably poorer than we imagine – something politicians of all stripes should, but probably won’t, consider as they grapple with our massive deficit.
“GDP that stems from new debt — mainly deficit spending — is phony: it is debt-financed consumption, not prosperity,” Arnott writes. “Net of deficit spending, our prosperity is nearly unchanged from 1998, 13 years ago.”
That seems hard to believe. The late 1990s are sometimes remembered as the last time the U.S. economy was consistently doing things like generating wage gains for people other than CEOs, and even the housing bubble-fueled 2000s are widely assumed to have not been a total wash.
Even the 90s weren’t that great.
To those of us who were in the smokestack industries, the 90s were a period of 3% “bonuses”, no pay raises, and no COLA adjustements, because the “official” inflation rate was below 3%. Not to mention the offshoring/outsourcing started there. And “mission creep”, where additional responsibilities keep getting added to your job description.
Get 3% pay raises in a 5-6% inflation environment for 10 years, and pretty soon, your defacto pay rate is down 20%. Then continue for another 10 years, and you are where we are right now. And the PTB/banksters are telling us we STILL are being “paid too much”.
And the PTB/banksters are telling us we STILL are being “paid too much”.
Shh! Dancing with the Stars is on! Don’t distract J6P!
No, the 90s weren’t that great in aviation as well. As you already know aviation hiring picked up just in time to slapped back down by the dot com crash and September 11.
For my friends that were able to get in on the dot com boom, the ride was shortlived. I’m rather glad I missed out on that one, even after some initial disappointment.
Most of us rode the dot com boom all the way up and all the way down. The good thing is I learned from that and sold 2 houses before the crash.
He’s absolutely right.
At least the 1990s included a telecom/IT investment boom that while not treating investors all that well has proven to be great for everyone else. What else has gotten better?
The economy “went of the rails” 30 years ago.
Mortgage Applications Up First Time in Month: MBA
By: Reuters
Applications for U.S. home mortgages rose for the first time in a month last week as interest rates eased and purchase activity picked up, an industry group said on Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, rose 5.3 percent in the week ended April 15.
That was driven by a 10 percent increase in the gauge of loan requests for home purchases, sending the purchase index to its highest level since early December.
The MBA’s seasonally adjusted index of refinancing applications gained 2.7 percent Fixed 30-year mortgage rates averaged 4.83 percent in the week, down from 4.98 percent the week before.
The spring selling season has exploded onto the scene. In about 10 years the shadow inventory will be gone.
“In about 10 years the shadow inventory will be gone.”
There’s an optimistic outlook if I’ve ever seen one.
You not only have to consider the sales pace, but the pace of deterioration of empty houses. Eventually a large chunk of the shadow inventory is a complete loss and never has to come to market.
“That was driven by a 10 percent increase in the gauge of loan requests for home purchases,”
That must be what`s driving the increase of
“Back on the market” listings on Fannie Mae HomePath.com
200 S Hepburn Ave
Jupiter, FL 33458
Single-Family
Back on Market
2 br
1 ba
$66,000
825 Center St Apt 49d
Jupiter, FL 33458
Single-Family
Back on Market
2 br
3 ba
$99,900
825 Center St Apt 44a
Jupiter, FL 33458
Condo/Co-op
Price Reduced
2 br
3 ba
$93,900
Paul B. Farrell
April 19, 2011, 12:01 a.m. EDT
10 Doomsday trends America can’t survive
Commentary: We are past the point of no return, thanks to Super Rich
By Paul B. Farrell, MarketWatch
SAN LUIS OBISPO, Calif. (MarketWatch) — Doomsday Capitalism? Capitalism is killing America? Yes, that’s the message in my tenth book. “Doomsday Capitalism, 10 Self-Destructive Trends.” But you’ll never see it in print. No one, even book publishers want to read this truth: Capitalism is destroying America.
Why? Super-Rich Capitalists get rich off these macro trends. They want happy talk. Back in 2007 Vanguard founder Jack Bogle called my warnings “prescient.” But that didn’t stop the meltdown. Next time financial historians warn of a bigger meltdown; a total collapse has been the destiny of every nation for eight centuries. This time, capitalism is the saboteur.
What S&P U.S. credit warning means
In the wake of Standard & Poor’s warning that the U.S. AAA credit rating is at risk, former Congressional Budget Office Director Douglas Holtz-Eakin explains to David Wessel why politicians are watching and what it might mean for a deal on the the deficit.
Yale scholar Immanuel Wallerstein warns that capitalism’s at the end of a 500-year cycle: The “political struggle is over what kind of system will replace capitalism, not whether it should survive.” We cannot stop this cycle.
Yes, Super-Rich Capitalists will fight to the death. But destiny is trapped in our DNA, historians warn, and will not change. America is run by these short-term thinkers. They never learn the lessons of history. They do not want you to know that their capitalism is self-destructive, that capitalism’s cycle is in a suicidal end game, that their “mutant capitalism,” as Bogle calls it, is destroying the very soul of America’s democracy.
Instead, leaders inside this conspiracy want Americans to follow their rigid doctrine: In Milton Friedman’s 1962 “Capitalism and Freedom,” the bible of Reaganomics; In Ayn Rand’s manifestos that guided Alan Greenspan and now Paul Ryan; and in Steve Forbes post-meltdown apologia, “How Capitalism Will Save Us: Why Free People and Free Markets Are the Best Answer in Today’s Economy.”
…
This is an interesting theory presented by a ranting lunatic.
But who is closer to the “truth”?
This guy, or Steve Forbes?
Just because he rants, doesn’t render his points invalid.
“How Capitalism Will Save Us: Why Free People and Free Markets Are the Best Answer in Today’s Economy.”
Is this why we send our jobs to a communist nation?
Awesome article, PB. Thanks for posting it.
The UK has come a long way since the “buy-to-let” craze days of 2006.
This housing benefit cut would push many out of their homes – to where?
Shared accommodation isn’t suitable or available for all
o Leslie Morphy
o guardian.co.uk, Wednesday 20 April 2011 13.16 BST
o Article history
Young person homeless hungry and begging in London.
‘A return to the days of widespread homelessness just doesn’t make economic sense’. Photograph: Janine Wiedel /Alamy
Last June, the government announced cuts to housing benefit that are expected to hit about a million households. There was major coverage at the time, including controversy over Boris Johnson’s use of the phrase “social cleansing”. But another change, included in November’s comprehensive spending review, has barely received any attention even though it will force tens of thousands to leave their homes.
The government is preparing to rush through regulations that mean up to 88,000 25- to 34-year-olds will suddenly be dropped from a benefit rate designed to cover the cost of a one-bedroom flat to the shared accommodation rate. This week, draft regulations are due to be published on the measure, which will be laid in parliament by the summer and take effect next year.
The average loss is £47 per week, and some people will see their benefit entitlement more than halved. Most of those affected will lose their home. This measure threatens to turn the clock back on street homelessness. We could find ourselves back in the 80s, when people living rough on the streets was a fact of life.
…
I guess the idea of sticking it to the young and not the seniors isn’t just a U.S. thing. Perhaps they figure the young can always sell their bodies, or something.
There are far more homeless seniors than young.
Where ARE you getting your talking points?
Intelligent Investing
Ideas from Forbes Investor Team
Obama Pushes Renting, Making It Easier To Whack Fannie And Freddie
Apr. 12 2011 - 9:49 am
Posted by Martin Fridson
In February 2011, the Treasury Department and Department of Housing and Urban Development released a white paper on reforming the nation’s approach to housing finance.[1] The media response focused mainly on the possibility, raised by the report, that Fannie Mae and Freddie Mac would be phased out.[2]
Taking these gigantic government-sponsored enterprises (GSEs) out of the picture certainly would represent a momentous departure from past government housing policy. Treasury and HUD discussed a second profound change, however, that received little attention from potential reporters.
Pages 18 and 19 contained the following paragraph (emphasis added):
…
This shift from “everybody should buy” to “everybody should rent” worries me.
While I’d quickly agree that giving huge loans to people who can’t pay them back is a tremendous mistake, forcing poor people to pay off the leveraged assets of the rich (or give them a hefty ROI, if the properties aren’t mortgaged) is an even bigger mistake, IMHO.
Nooze from Tucson: Those darn foreclosures are driving down house prices. From today’s fishwrap:
Foreclosure sales up in March
Methinks this must be why the local Home Depot and Lowes stores appear to be a lot busier. Ditto for the hardware stores. Methinks that a lot of those foreclosures need work.
They do. They always do.
Has anyone noticed that the media hasn’t commented or made the stink
it did when Bush was in office about oil prices going up? Over $3. a barrel
today. Only when there are Democrats in charge do little annoying things
like these get overlooked. People on fixed incomes and people that don’t
earn that much money are being punished by Bernankes money printing
at the direction of Obama and his surrogates.
Blaming Obama is just ignorant.
You mean like this?
Bush Says Dems to Blame for High Gas Prices
http://abcnews.go.com/Politics/PainAtThePump/story?id=5197676&page=1
Back to the drawing board “Unc”. lmao.
Dollar hits 15-month low against euro
- cnnmoney
The dollar took a beating Wednesday, losing ground to a range of currencies, and falling to its lowest level against the euro in 15 months.
And that’s pretty much been the trend in recent months. At the start of the year, the euro was trading at $1.33 against the dollar, but has since surged to $1.45 against the beleaguered greenback.
The dollar index, which measures the U.S. dollar against a basket of currencies, has fallen 5% so far this year to around 74, as jittery investors flocked to the dollar for safety. That’s down from a high near 87 in June of 2009.
The continued weakening of the dollar — if you go by reputation — is a little puzzling. The dollar is thought of as a safe haven asset in times of turmoil. If you look at the past four months, it’s hard to find anything but unsettling events. Japan. Egypt. Libya. Eurozone debt.
But the dollar has failed to appreciate.
One reason the dollar is suffering is the continued strength of equity markets. On Wednesday, the Dow was up triple digits, as investors flocked to riskier investments.
Plus, you’ve got the expansive monetary policy of the Fed, which some experts say weakens the dollar, and a dysfunctional U.S. political system that has put investors on edge.
Still, investors might want to hold off on hitting the panic button. The dollar remains about 8% above its all-time low against the euro set in July 2008. But more trouble might be ahead.
Speaking of inflation, I ran into Sam’s Club to pick up a roll of Angus Beef burger patties.
The price was $4 higher (18 vs 14) than just a few months ago.
Nice
Cheese seems to have skyrocketed too!
you did not use the $4 coupon?
As the bumper sticker on the Hummer read…Gas $5 a gallon…bring it on!
Unexpected increase in supply pushes oil above $111 a barrel, retail gas continues to rise. April 20, 2011
NEW YORK (AP) — Oil settled above $111 per barrel Wednesday as the dollar weakened and the government reported an unexpected drop in U.S. crude supplies. Gas pump prices also edged higher to $3.84 for a gallon of regular.
Benchmark West Texas Intermediate oil for June delivery gained $3.17 to settle at $111.45 per barrel on the New York Mercantile Exchange. Oil has increased 20 percent since the beginning of the year as investors anticipated rising global demand and unrest in North Africa and the Middle East threatened oil fields and shipping lanes vital to world supply.
The surge in oil had cooled recently as industry groups monitored the effect of higher prices on petroleum demand and the global economy. The International Energy Agency, OPEC and others have said that they see signs that consumers are using less fuel as prices rise. In the U.S., retail surveys by MasterCard SpendingPulse indicate that motorists have cut back on gasoline purchases for the past seven weeks.
Oil rose Wednesday as the dollar lost ground to the euro, the British pound and other major currencies. The dollar has been sliding since Standard & Poor’s downgraded its outlook for U.S. debt earlier this week. Oil, which is priced in dollars, tends to rise as the dollar falls. That makes crude contracts cheaper for investors holding foreign currency.
Unexpected increase in supply pushes oil above $111 a barrel, retail gas continues to rise
Shouldn’t greater supply, absent a surge in demand, lead to lower prices?
I thought that made no sense too. I guess oil goes only up these days.
“Cars now run on sea water…Gas prices go up!”
Gas Prices Reach Five Dollars a Gallon in the Nation’s Capital
Gas prices reach five dollars per gallon at a gas station in Washington, DC on April 19, 2011. Unrest in the Middle East and price speculation have steadily led to higher oil prices and consequently higher gas prices throughout the year so far. UPI/Roger L. Wollenberg
Reg.$4.99.
Supreme. $5.19
“We can compare gas prices over time by calculating the cost of 1,000 gallons of gas purchased at the average price in a given year, as a percentage of per-capita disposable income in that year. For example, in 1935, when gas prices were 17 cents per gallon and annual disposable income was $466, the cost of 1,000 gallons of gas was 36% of average disposable income. Today, it takes less than 7% of our disposable income to buy 1,000 gallons of gas at the current $2.10 a gallon. The “cheap” gas of the ’60s and ’70s cost about 12% as a share of income. ”
This was from 2005. from USA Today!
Bring it up to date, 1,000 gallons of gas would cost, say,$5,000.
Median income in Santa Rosa, is, about, $75,000, so 1,000 gallons would be about 7% of the median income, compared to the 36% in 1935.
And if you drop it to the very low income figure of $35,000, (lol) then it would 14% of a years salary.
remember those days in the 1930’s when the average wage was about 25 cents an hour and gasoline was 12 cents, during gas wars, and 15 cents normally. And at that time I had to work 36 minutes to buy a gallon of gas.
We only think it is too high now, because it has not been rising with the inflationn
Banks Await Foreclosure Deal’s Financial Terms as States Split
Bloomberg - Apr 20, 2011 2:33 PM ET
Foreclosure Probe Talks Said to Yield Agreements With Banks
The 50 states, along with federal agencies including the Justice Department, seek to set requirements for how banks service loans and conduct home foreclosures. Photographer: Matthew Staver/Bloomberg
Attorneys general negotiating the settlement of a nationwide foreclosure investigation have yet to approach banks with a proposed dollar amount that would fund principal reductions for borrowers, a state official said.
The states have agreed on some terms while failing so far to reach an accord on monetary payments by lenders, a person familiar with the talks said last week. Eight Republican attorneys general have publicly challenged the concept of principal reductions as part of a 50-state settlement.
Last month, state officials and federal agencies, including the Justice Department, submitted settlement terms to five mortgage servicers, including Bank of America Corp. (BAC) and JPMorgan Chase & Co. (JPM) They called for a “substantial portion” of an unspecified monetary amount to go toward a loan modification program.
Virginia Attorney General Kenneth Cuccinelli and six other Republican attorneys general assailed the proposal as overreaching, with four calling principal reduction a “moral hazard.”
“You’re declaring in advance who the winners and losers are,” Georgia Attorney General Sam Olens said in an interview yesterday. “I’m a little concerned that this process disengages the normal market forces.”
Oklahoma Plan
Oklahoma Attorney General Scott Pruitt is seeking an alternative settlement with banks that respects “the appropriate role of attorneys general,” his office said in a statement today. The settlement could be a model for other states, Pruitt said.
The six-month probe by the states was triggered by claims of faulty foreclosure practices following the housing collapse, which state officials said may violate their laws. Geoff Greenwood, a spokesman for Iowa Attorney General Tom Miller, a Democrat who leads the investigation, said in an interview that the states haven’t presented a dollar figure to the banks, declining further comment.
Another person familiar with the talks said state negotiators are discussing what form a financial component may take, and that there will be no settlement without a monetary payment. The person, who declined to be identified because the talks are private, said it may take four months to reach a deal.
” a Democrat who leads the investigation, said in an interview that the states haven’t presented a dollar figure to the banks, declining further comment.”
Well let`s see, there has been about 8 trillion $ loss in house values since the peak. So how about 8 trillion $ that should cover it.
Palm Beach County clerk sees foreclosure trend reverse as filings increase in March
by Kim Miller
Palm Beach Post Staff Writer
After several months of declining foreclosures, the Palm Beach County Clerk of Courts reports today that March saw a 20 percent increase in initial filings from the previous month.
At 908 new foreclosure filings, it was the highest number of new cases in Palm Beach County since October last year.
Clerk Sharon Bock predicts those new filings will continue to climb.
“We expect the increase in filings to continue as banks become less hesitant to file,” she said. “We believe that as banks become more comfortable with their foreclosure processes, they will release files they have been holding and volumes will start to escalate.”
March’s filings, although higher than February, still represent a 52 percent decrease over the number of cases filed during the same month in 2010.
March home sales rise in Florida, Palm Beach County; prices off 2010 levels
By Kimberly Miller Palm Beach Post Staff Writer
Wednesday, April 20, 2011
Florida sales of existing homes jumped in March as the spring buying season perked up, but prices were down statewide with the most drastic drop occurring in Palm Beach County.
The median sales price for a single-family home in Palm Beach County last month was $186,500, a 24 percent decrease compared to the same time in 2010.
“Analysts with the National Association of Realtors note that sales of foreclosures and other distressed properties continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes,” said a press release from the Florida Realtors, which compiled today’s report.
Median sales prices in Palm Beach County were a bright spot in the February report for sellers, increasing to $205,400 after slumping to $192,800 in January _ the first time since 2002 that the county’s median price fell bellow $200,000.
March marks the beginning of the spring buying season. But Realtors note it can be difficult to compare to sales in March 2010, which included purchases driven by the up to $8,000 tax credit for first-time buyers.
CNN
Even in these down times, there’s money to be made buying and flipping houses.
One might think this would be a most dangerous game — after all, home prices are down more than a third from their peak in most areas. But plenty of investors are taking the risk in exchange for big profits.
In fact, nearly 1 million homes were bought as investment properties in 2010, according to the National Association of Realtors.
“It’s absolutely viable,” said Perry Henderson, a real estate agent and investor in Austin, Texas. “But you have to buy intelligently and go after the right opportunities.”
Henderson helped one investor close a deal on a three-bedroom, two-bath house for $138,000 in Austin. His client is now selling the property for $188,000 after putting in $10,000 worth of repairs. Add in transaction costs and this investor is still making at least $20,000 in just a few weeks of work.
His client is now selling the property for $188,000
define “selling”.
I don’t doubt their are opportunities - Austin is still doing well - but I wouldn’t call it a success until the sale has happened.
‘Scuse me while I borrow your drum and go badda-boom! with it.
define “selling”.
Offering? Begging?
He’s right about being smart doing it. This is the economy that separates the wannabees from the pros.
However. My experience is that the average sell time is at LEAST 3 months, even when the house is below market price for the given neighborhood.
So, 1-3 months to buy. 1-3 months to rehab. 3 months to sell. 6 months at best to flip.
And what’s to say that, six months from now, a lot of other flippers will also be trying to flip their flip-houses?
…and the millions of others just like them.
Exactly. It’s a tough business. If you don’t know what you’re doing and have capital for emergencies (like contractor disasters, longer than anticipated sell times), you will get burned badly.
I haven’t seen that at all in the Phoenix area. Decent houses that are priced at or below market are going pending in a matter of days. It’s the stuff that’s overpriced and/or poor quality that’s sitting on the market.
Decent houses that are priced right SHOULD sell in a matter of days.
Most flippers don’t make money buying decent houses. (although there is an industry that does, but it’s small and protected) They make money rehabing and then selling.
Also, the flip market is slightly different in every region.
But I’ve never seen a used house that didn’t need some maintenance. Paint, deep cleaning, and yard clearing are almost always required. But that’s cheap stuff compared to your average flipping.
not “a few weeks work.”
Yep. The writer or he is lying like a rug.
Keep it up, unions - the next Boeing production line will be in Guangzhou.
How DARE Boeing think they can decide which state to put their production lines!
———————————————
Boeing illegally put second 787 line in S.C., complaint says
Seattle PI | April 20, 2011 | Aubrey Cohen
Boeing illegally put its second 787 Dreamliner assembly line in South Carolina in retaliation for strikes in Washington and should be required to build the line in Washington, according to a National Labor Relations Board complaint filed Wednesday.
The board’s acting general counsel filed the complaint in response to a charge that the International Association of Machinists and Aerospace Workers union District 751, backed by the national union, filed on March 29, 2010. A board administrative law judge is scheduled to hear the case on June 14.
The complaint says Boeing executives “made coercive statements to its employees that it would remove or had removed work from the (union) because employees had struck” and threatened that future strikes would cost it more work.
“By opening the line in Charleston (S.C.), Boeing tried to intimidate our members with the idea that the company would take away their work unless they made concessions at the bargaining table,” IAM District 751 President Tom Wroblewski said in a statement Wednesday. “But the law is clear: American workers have a right to pursue collective bargaining, and no company – not even Boeing – can threaten or punish them for exercising those rights.”
Boeing issued a statement Wednesday saying it will “vigorously contest” the complaint.
“This claim is legally frivolous and represents a radical departure from both NLRB and Supreme Court precedent,” Boeing Executive Vice President and General Counsel J. Michael Luttig said. “Boeing has every right under both federal law and its collective bargaining agreement to build additional U.S. production capacity outside of the Puget Sound region.”
Boeing also criticized the timing of the complaint, noting it came 17 months after it announced it would put the line in South Caroline and as construction is nearly complete, with more than 1,000 new workers hired and assembly of the first airplane set to begin in July.
+1
You couldn’t pay me to fly on the 787.
“Keep it up, unions - the next Boeing production line will be in Guangzhou.”
They might as well move it there, the aircraft has very little US content to begin with. From Wikipedia:
“Subcontracted assemblies included wing manufacture (Mitsubishi Heavy Industries, Japan, central wing box)[32] horizontal stabilizers (Alenia Aeronautica, Italy; Korea Aerospace Industries, South Korea);[33] fuselage sections (Global Aeronautica, Italy; Boeing, North Charleston, USA; Kawasaki Heavy Industries, Japan; Spirit AeroSystems, Wichita, USA; Korean Air, South Korea);[34][35][36] passenger doors (Latécoère, France); cargo doors, access doors, and crew escape door (Saab, Sweden); floor beams (TAL Manufacturing Solutions Limited, India);[37][38] wiring (Labinal, France);[39] wing-tips, flap support fairings, wheel well bulkhead, and longerons (Korean Air, South Korea);[40] landing gear (Messier-Dowty, France);[41] and power distribution and management systems, air conditioning packs (Hamilton Sundstrand, Connecticut, USA).[39][42] Boeing is considering bringing construction of the 787-9 tail in house; the tail of the 787-8 is currently made by Alenia.[43]”
Of course, by giving the away the farm Boeing is training its future competition. As always, in typical Corporate America fashion, they are penny wise and pound foolish. It won’t be long before Chinese brand airliners appear, undercutting Boeing using technology that is being given away.
And we all know how offshoring everything did wonders for the 787’s schedule. I remember when Boeing was laughing at Airbus for being late with the A380. Now it’s Boeing’s turn to be even later with the 787.
What a Frankenplane!
“It’s a ‘49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59 automobile…it’s a 60, 61, 62, 63….”
Sounds as if Boeing is now being treated as Reardon Steel.
Another hope ‘n change dupe sees the light.
http://blogs.sacbee.com/capitolalertlatest/2011/04/outside-facebook-former-obama.html
President Barack Obama could hardly find friendlier ground as he starts a fund-raising swing through California today, but there were signs of discontent outside Facebook headquarters, where he is hosting a town hall.
It wasn’t that the crowd was large - it wasn’t - but that many of the people hoisting signs were young, liberal voters who cast their first ballots for Obama, even volunteered for him, in 2008.
Chelsea Byers, a Code Pink intern who was studying abroad in 2008, helped organize an effort that year encouraging students to return absentee ballots for Obama. But she said she is upset with his actions in Libya.
“We just had hopes of seeing this great new Democratic base against wars,” she said. “I definitely am a fan of Obama. I like Obama. But his policies, and what they’re doing, it’s got to stop.”
Byers and her colleagues held signs that encouraged Obama, in the vernacular of the social networking site, to update his war status and budget profile.
“He made a lot of promises,” she said. “It’s dissatisfying.”
http://www.youtube.com/watch?v=Lb3ANqu-I7g
The next time you fill your gas tank or buy groceries, recall Ron Paul’s precient January 21, 2009 warning about Federal Reserve policies to a bemused “Helicopter Ben” Bernanke. Hyperinflation is coming.
recall Ron Paul’s precient January 21, 2009 warning about Federal Reserve policies
I still proudly sport my “Don’t Blame Me - I Voted For Ron Paul” bumper sticker.
It’s sad how many people ask me who he is…
I have the same sticker. I get a lot of honks & thumbs up from the thinking five percent.
Ron Paul is the honey badger. Ben Bernanke is the cobra.
http://www.youtube.com/watch?v=4r7wHMg5Yjg
Somebody should come out with a “I’m sorry things are still screwed up……..I didn’t vote for Ron Paul” bumper sticker.
http://www.cnbc.com/id/42683030
Even the Wall Street fluffers at CNBC are starting to make the connection between the Fed’s policies and soaring inflation.
The fact that anybody ever doubted the Fed’s role in the asset price inflation of the past few years is what’s surprising. It was even more obvious than the housing bubble, seeing 20%+++ price increases, all during “The Greatest Recession Since the Great Depression.”
It’s all about the dollar, IMHO.
I was actually surprised that the stock market took a hit when the S&P degraded the outlook on US debt. I mean - the only remaining option are stocks, right? Gold is very high, so are people going to rush into that?
So why the market drop when the S&P downgraded the US debt? I find that quite intriguing.
“So why the market drop when the S&P downgraded the US debt?”
It is puzzling. But here are a couple of possible explanations:
1) The
degradationdowngrade of the US debt ratings outlook may necessitate more austere fiscal measures going forward, which would be less stimulative for the economy than less austere measures. These could translate into lower corporate profits going forward, which tends to be directly reflected in stock valuations.2) The prospect of a lower debt rating could, theoretically, result in higher Treasury bond yields, which is equivalent to lower Treasury bond prices. Relatively less expensive Treasurys would potentially attract money away from the stock market, as a portfolio substitute, resulting in lower stock prices.
3) Since higher Treasury yields attract investment away from other fixed income asset classes, higher yields across the board are likely; but this implies a higher discount rate for valuing future income streams. But this would imply a higher borrowing cost for corporations, resulting in another hit to profits.
4) Even if corporate profits were not directly affected by higher borrowing costs (e.g. the future profit outlook was the same as before), a higher interest rate would translate into a lower expected present value of future corporate earnings, implying lower stock prices on a fundamental valuation basis.
Not sure of the extent to which if any of the above explain the effect of S&P’s announcement.
Now that I read what I wrote, I’m not sure “downgrade of the US debt ratings outlook” is the right jargon, either…
It gets really confusing when you enter the realm of predicting a future rating, especially given how poorly we recently saw current ratings perform as the housing bubble popped.
Hmmm… interesting angles.
There was a fellow on local radio the other day who had written a book on predicting the future. He noted the difficulty that experts had in doing so.
It’s like being in traffic and trying to figure out which lane is going to move faster. Recently I saw three lanes of traffic. The right lane was ending. The middle lane was more packed with traffic and there were a couple of larger trailer-towing vehicles. So I got in the left lane. But it turned out the lane with fewer cars and no large vehicles turned out to be the slowest. Why? A few slow drivers. I could not have predicted that from my snapshot.
I’ve heard that is similar to playing poker. An excellent player can be beaten by a bad one in one particular hand. But over the long run, the better player will win overall. Also, it depends on the luck each individual is having. There have been nights where the cards I am dealt are fantastically good, allowing me to regularly win. Then there are nights when the cards I am dealt are just miserable.
I guess the way to regularly win in the stock market is to either be part of the infrastructure - the “house” - where you collect fees and “win” regardless of what the market is doing; or to create your own financial weather like Warren Buffet; or to simply have that ineffable quality called “luck”.
Yes, you are spot-on in that last paragraph.
Tried this website; it’s busted.
Curious what kind of subsidies are offered here…
FANNIE MAE® Launches Refi PlusTM Program
Program Provides Streamlined Refinance Process
http://www.suntimes.com/entertainment/movies/4935704-421/gold-from-ayns-vault.html
Proof that not all Americans are zombies - “Atlas Shrugged” will never be a blockbuster to the dumbed-down masses, but it’s doing surprisingly well.
While it’s good to see that people are interested in things other than “shoot-to-kill” movies, etc., “Atlas Shrugged” is not really an accurate portrayal of what happens (or can happen) in reality. It’s totally theoretical and idealistic, with no factual or historical basis to back up it’s premise.
I really enjoyed “Hannah.” Bizarre.
ECONOMY
APRIL 21, 2011
Existing-Home Sales Tick Up, but Prices Slip
As Surge in Distressed Deals Discourages Owners From Trading Up, Tough Loan Rules Keep First-Time Buyers on Sideline
By S. MITRA KALITA and DAWN WOTAPKA
Sales of previously owned homes rose slightly in March, but prices continued to fall, underscoring the fragility of the housing market’s recovery.
Existing home sales increased 3.7% in March from February, according to data from the National Association of Realtors released Wednesday. That represents a seasonally adjusted pace of 5.1 million—less than the 5.4 million rate in January and 5.2 million in December.
The numbers disappointed an industry that has been hoping for a rebound in the all-important spring sales season. “The economic recovery has bypassed the housing market,” Toronto-based Capital Economics wrote in a note to clients.
Distressed sales accounted for 40% of all sales in March, the highest in two years, according to NAR. All-cash buyers made up 35% of all transactions—the highest since record-keeping began in 2008—in a sign of a persistently tight lending environment keeping many entry-level buyers from inking deals.
“A fundamental upturn in housing requires first-time home buyers,” said Steve Blitz, senior economist with ITG Investment Research. “With tighter requirements and no low-down-payment [loans] available, the renting cohort is still renting and not making the necessary impact to believe that the housing market has turned,” he said.
Until prices stabilize, the housing market faces a long slog toward recovery. The median price in March fell to $159,600, down nearly 6% from a year earlier. Home prices have fallen so low that investors are snapping up homes to fix and resell for a profit or to turn into rentals; investors accounted for 22% of sales activity in March, up from 19% in February.
Realtors say sellers must accept the reality of low pricing and stop waiting for a return of boom-era values. “If sellers are realistic, their homes will move quickly,” said Cindy Jones, a broker with C.J. Realty Group in Prince William County, Va., outside Washington, D.C.
…
“…but prices continued to fall, underscoring the fragility of the housing market’s recovery.”
Isn’t this a good thing, as falling prices imply improving affordability, and affordability is a long-sought, though highly-elusive, government policy objective?
That said, I see no reason why anyone who is thinking about buying a home in the near future should be in any hurry, as falling prices now suggest better deals in the future, and nobody wants to catch themselves a falling knife.
REAL ESTATE
APRIL 20, 2011
Housing Starts Remain Subdued
By JEFFREY SPARSHOTT and DAWN WOTAPKA
Home building rebounded a bit in March from a winter slump, but construction remains near historically low levels heading into the crucial spring selling season.
Construction of homes and apartments last month jumped 7.2% from a month earlier to a seasonally adjusted annual rate of 549,000 from 512,000 in February, the Commerce Department said Tuesday.
The figures for February were revised upward and building permits, a gauge of future construction, climbed 11.2% from a month earlier to an annual rate of 594,000.
But even with the monthly bounce, overall activity remains depressed: March’s level of housing starts was the tenth lowest since records began in January 1959. Compared with the same month a year earlier, overall new-home construction was 13.4% lower.
Housing remains a significant soft spot in an otherwise recovering economy. Builders have remained idle due to weak demand and competition from the large stock of empty housing. Buyers, meantime, are having trouble getting credit or are wary of buying when home prices are still falling.
Separately, Tuesday, the Federal Reserve proposed a set of minimum standards for home lending as part of an effort to ensure that consumers can afford mortgages they take out.
The rules were required by the Dodd-Frank financial overhaul passed last year, which tasked lenders with ensuring that all borrowers have the ability to pay back their home loans.
…
Agreement on the continuing resolution was just the warmup act. Time will tell how much further Boehner can sink his approval rating on the debt ceiling issue.
But perhaps so long as he keeps the campaign contributions flowing from the superrich Rethugnicant base, approval doesn’t matter much.
Boehner’s approval rating drops
Washington Post
Paul Kane – Wed Apr 20, 3:00 pm ET
Los Angeles – Negative attitudes about Congress have left their mark on House Speaker John A. Boehner (R-Ohio) as the legislative process of wheeling and dealing has dominated news from Capitol Hill over the past few weeks.
Three and half months after Boehner claimed the speaker’s gavel, 40 percent of Americans say they disapprove of the way he is handling his job, according to a new Washington Post-ABC News Poll. That compares with 27 percent in mid-January, when he was just two weeks into the office. The new poll found that 43 percent approve of Boehner’s performance.
…
The healthiest housing markets in the country! Nearly half the mortgages are higher than the value of the houses! (Iowa, 43%)
http://realestate.yahoo.com/promo/states-with-the-healthiest-housing-markets.html
In the top 4, more than 1 in 5 mortgages is underwater (if I’m interpreting that “negative equity” statistic correctly.)