Bits Bucket for May 5, 2011
Post off-topic ideas, links, and Craigslist finds here.
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
Location:Northern Arizona, United States
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Fed Presidents Signal Record Stimulus Won’t Be Removed Soon
(Bloomberg)
Two Federal Reserve regional bank presidents indicated that the central bank won’t remove record stimulus soon, saying the Fed is missing its goal for full employment and inflation isn’t a long-term risk.
~ Inmates running the insane asylum, with the blessing of CONgress .
“Two Federal Reserve regional bank presidents indicated that the central bank won’t remove record stimulus soon…”
Barney Frank tries to restructure the Federal Reserve
CNNMoney
“[Barney]Frank’s main complaint is with the selection process. Unlike Fed governors, the regional bank presidents are not selected by elected officials, but by a board comprised of business leaders in their communities.”
“…but by a board comprised of business leaders in their communities.”
Barney can’t stand the thought of any power originating away from the Mother Ship…
Do we want the Fed to be more private or more public?
Do we even want the Fed? I don’t.
No Fed- then what?
Free hot dogs for everyone on Cinco de Mayo.
Sounds kinda ‘commie’, Big V. (Free Beer?)
“Do we want the Fed to be more private or more public?”
More decentralized / less power concentrated in DC.
“More decentralized / less power concentrated in DC.”
It was an either/or question- you picked c. (Although I agree with your sentiment.)
“…more private or more public?”
I have no simple answer to a. and b. To begin with, what is the Fed now? It seems like quite the chameleon — part of the govt when convenient, yet apparently owned and heavily influenced by private banks. More generally, in an era where Freedom of Speech is redefined in terms of money flows, and crony capitalism provides ample bailouts for too-big-to-fail firms and cake for the rest of us, the whole Chicago-school private-public dichotomy seems to be on thin ice.
At any rate, the more interesting question to me is concentration of power. Being as suspicious of centrally concentrated power as I am, any efforts to spread it out to more effectively represent diverse regional interests seems preferable to further moves towards governance by clueless central planners.
PB:
Maybe the answer is that Congress needs to exert more control over the Federal Reserve.
“Maybe the answer is that Congress needs to exert more control over the Federal Reserve.”
Depends on what kind of control you mean. I believe they should be bound by their Congressional charter, and not be given free rein to pick winners (mainly banks) and losers (non-banks).
But if you get the Congress, with their myriad political motivations, into the process of micromanaging the Fed, any number of unintended, undesirable results might follow.
The Constitution already says that the job of regulating our currency belongs to Congress. They chartered the Federal Reserve and they are responsible for it.
“They chartered the Federal Reserve and they are responsible for it.”
I may be wrong about this, but I don’t believe Congress is qualified to regulate the currency in a modern, global economy. Perhaps if we turned the clock back to 1776?
Well PB, that may be true, but that’s who has the job. Now all we have to do is vot for candidates who have demonstrated competency.
They may be psychopathic, but they are not stupid. Pathological liars, for sure. I ran this through the babblefed translator and it says:
“Banks still need a lot more money, so the rest of you are screwed.”
So buy this dip in gold and silver?
What are the fundamentals driving the prices down? Margin levels? I think the big money will move back in and buy on the dip.
What are the fundamentals driving the prices down?
What were the fundamentals driving them up? It’s possible the rise wasn’t supported and it’s simply correcting.
I don’t know…am curious to understand as well.
Money printing. QED.
Look out belowwwwwwww!!!!
Realtors Are Liars
Not every lie is a crime.
Not every lie is codified a crime but your rationalizations for dishonesty, graft and legalism are duly noted.
She was referring to an article posted yesterday about Deutsche Bank.
She?
Barry Ritholtz: Housing Could Struggle for Another 5-10 Years
| Daily Ticker
After two years of recovery, is the American economy back on the ropes?
Stocks are slumping today following weaker than expected employment data ahead of Friday’s non-farm payrolls report. Private payroll processor ADP reported that 179,000 private sector jobs were added in April, but that was less than expected. Meanwhile, the Institute for Supply Management’s service sector index rose at the slowest pace in eight months in April. Are higher energy and food costs having an impact? That could be the case.
Barry Ritholtz of FusionIQ and author of The Big Picture blog, says there’s no reason to panic. “Subpar GDP, very anemic job creation, slow deleveraging on both the governmental and consumer basis,” is typical of a post-credit crisis recovery, he says, citing the work of Carmen Reinhardt and Ken Rogoff. “The only silver lining on that is corporate America is fairly deleveraged, and what debt they are carrying is at very, very low rates.”
The biggest overhang for the economy remains a sluggish housing market, Ritholtz contends. “It’s not going to be a bright spot in the economy and probably not for five to 10 years,” he tells Aaron Task and Daniel Gross in the accompanying video.
Why? We still have millions of Americans who remain in homes they couldn’t afford to buy. Ritholtz suggests half of the lot has already defaulted, but there’s still a long way to go. Plus, housing prices are still too high.
Until these issues are worked out, the economy won’t truly return to previous productivity levels, he argues.
“Ritholtz suggests half of the lot has already defaulted, but there’s still a long way to go.”
Half gone from 2008-2011 suggests 3/4 gone by 2014, 7/8 gone by 2017 and 15/16 gone by 2017…(half-life model of housing default).
“Plus, housing prices are still too high.”
Yup…too many would-be buyers are being forced to face fluffed foreclosure-home prices.
I think the rate of change increases over time.
Well the first derivative certainly drops precipitously with a lag after the points when massive govt-sponsored market supports are withdrawn…
“…slow deleveraging on both the governmental and consumer basis,””
Governments are deleveraging?
China. If you can’t beat em join em. that’s the fed’s model for future growth. Corporate fascism requires more control over the sheeple. Financial slavery is where we are headed. Housing will never come back and if it does it will require a new generation of fresh blood and stupid people.
Happy 2nd Tier Mexican Holiday
LOL, margaritas anyone?
As many of you know, I lived 12 years in Mexico City. CInco de Mayo is basically a banker’s holiday down there, very minor and 2nd tier, very few in the private sector get the day off.
no fare i wanna day off
http://www.eluniversal.com.mx/noticias.html
This is a link to an online Mexican newspaper.
There is no mention of Cinco de Mayo.
Thanks for the perspective Colorado. I think I picked up on the holiday myself as a Mom home w/small kids. Nice excuse to get together for a girls night out. Radio personalities probably did mention some quick historical reference as they steered us to their advertiser’s establishment.
Stop being mean, i wanna day off.
In Colorado, I agree.
Matter of fact, one of my friends was in Mexico during Cinco de Mayo. This was a few years back, but he reported that the bars were deader -n- a doornail.
Which disappointed him because he really wanted to celebrate Cinco en Mexico. So much for that idea.
LOL!
Now if you really want a day to celebrate in Mexico:
Sept 15-16 (Independence day)
May 10 (Mother’s day)
Nov 20 (Revolution day)
May 1 (Labor day)
December 12 (Lady of Guadalupe)
Dec 31-Jan 1 (Duh!)
Any day the Mexican soccer team wins
The entire week before Easter (Everyone goes on vacation)
Christmas Eve/Day
May is a great month to be a school kid:
May 1 - Labor day
May 5 - KIds do get it off
May 10 - Mom’s day
May 15 - Teachers day
Kind of like how St Patrick’s day is bigger in NYC or Boston than in Dublin.
A friend born and raised outside Dublin told me the biggest drinking day for him in that town was Christmas. The bars would close to the public, he explained, but then have all their friends and family there into the wee hours of the night.
E-mail from our “EEO / Diversity Manager” sent today:
Cinco de Mayo is celebrated nationwide in the US and regionally in Mexico, primarily in the state of Puebla. The date is observed in the US as a celebration of Mexican heritage and pride … in the state of Puebla, the date is observed to commemorate the Mexican army’s unlikely victory over French forces at the Battle of Puebla on May 5, 1862.
The holiday crossed over into the United States in the 1950s and 1960s but didn’t gain popularity until the 1980s when marketers, especially beer companies, capitalized on the celebratory nature of the day and began to promote it.”
The holiday crossed over into the United States in the 1950s and 1960s but didn’t gain popularity until the 1980s when marketers, especially beer companies, capitalized on the celebratory nature of the day and began to promote it.
Steve J has it dead to right. Here in Tucson, Cinco de Mayo is a big beer drinking event.
And, get this, the big drinkers aren’t necessarily found in the Hispanic community. Nope, they’re University of Arizona students hitting the bars on 4th Avenue.
Speaking of 4th Avenue, I have a business-related meeting down there this evening. (It’s a local chapter of a national trade group.) I’ll be happy to share a student drunkeness report with everyone tomorrow.
oh a Dos Equis draft sounds good about now
And since part of the French motivation was to have a base to support the South during the Civil War, I say it is appropriate to celebrate in the US.
However, I think I am going to a concert of English choral music instead of a bar. Then again, I am a weirdo.
“EEO / Diversity Manager”?
Oy Vey. I hope they spend the same amount of time, if not more, on American culture and holidays. This country is DOA.
I hear early cockcrows of reason…
Why the Super-Rich Pay Half the Taxes We Do
newsweek
It drives economist Bruce Bartlett crazy every time he hears another bazillionaire announce he’s in favor of paying higher taxes. Most recently it was Mark Zuckerberg who got Bartlett’s blood boiling when the Facebook founder declared himself “cool” with paying more in federal taxes, joining such tycoons as Bill Gates, Warren Buffett, Ted Turner, and even a stray hedge-fund manager or two.
Bartlett, a former member of the Reagan White House, isn’t against the wealthy paying higher taxes. He’s that rare conservative who thinks higher taxes need to be part of the deficit debate. His beef? It’s a hollow gesture to say the federal government should raise the tax rate on the country’s top wage earners when the likes of Zuckerberg have most of their wealth tied up in stock. Many of the super-rich see virtually all their income as capital gains, and capital gains are taxed at a much lower rate—15 percent—than ordinary income. When Warren Buffett talks about paying a lower tax rate than his secretary, that’s because she sees most of her pay through a paycheck, while the bulk of his compensation comes in the form of capital gains and dividends. In 2006, for instance, Buffett paid 17.7 percent in taxes on the $46 million he booked that year, while his secretary lost 30 percent of her $60,000 salary to the government.
“It’s easy to say ‘Raise taxes’ when you know you’re not going to have to pay those taxes,” Bartlett says. “What I don’t hear is ‘Let’s raise the capital-gains tax.’” Instead the focus has been on the federal tax rate paid by those with an annual income of $250,000 or more—the top 3 percent of earners. Bartlett argues that while raising taxes on the country’s richest individuals would go a long way in easing the debt crisis, it makes no sense to treat the professional making a few hundred thousand dollars a year the same as the Richie Rich set. Maybe it’s hard to muster sympathy for an executive pulling down $1 million a year. But ours is a tax system where a person in the top tax bracket (those earning more than $374,000 in 2010) pays a tax rate of 35 percent on the upper portions of his or her income (37.9 percent if you include Medicare), whereas a hedge-fund manager or mogul earning 10 or 100 times that amount pays less than half that tax rate.
“America has two tax systems. Separate and unequal,” says David Cay Johnston, a bestselling author and columnist for Tax Notes, who has spent much of the past decade exposing ways the tax system favors the wealthy.
I concur. Everything in the US has been tilted in favor of the wealthy over recent years. Time to tilt it back. Too many bad side effects.
In Buffett’s defense, he usually says the gov should raise taxes on ‘people like me’. I think that implies raising capital gains taxes, although I’m not sure he specifically says that.
Instead the focus has been on the federal tax rate paid by those with an annual income of $250,000 or more—the top 3 percent of earners.
The super rich didn’t get to where they are by writing checks. And its time for the 250K crowd to realize that they have much more in common with the under $500/week crowd than with Bill Gates or Warren Buffet.
LOL, what’s the income tax rate on the under $500/wk crowd?
About the same rate as billionaires pay on their capital gains, regardless of their amount.
Sales tax in some states + Social Security + Medicare + miscellaneous crap taxes (tire recyling fee, battery reclamation fee, etc) ends up being greater than the 15% those stewards of democracy pay in Connecticut.
How about peeling this to the next level. I can see a justification for lower tax rates on capital gains. It is an incentive to invest, take risks to create capital. We’d be better off IMO if there was no tax incentive to invest offshore.
BTW, the FedGov has an adequate income. It simply knows no bounds on its spending.
“I can see a justification for lower tax rates on capital gains. It is an incentive to invest, take risks to create capital”
People with money will invest it- what else will they do with it?
Spend it? That helps the economy.
Save it? That lowers interest rates and provides money for others to invest.
“BTW, the FedGov has an adequate income. It simply knows no bounds on its spending.”
Even if that were true, it’s still not fair to tax the wealthy’s income at far less than most everyone else’s income, no?
Actually I think the “tax rate on the wealthy” discussion misses the point by a mile. The income tax system is designed to burden wage earners. If you are “rich” it is pretty simple to shelter gains from taxation and only take what you need to spend on yourself off the table as “income”. Even doable if you are just sort of well off.
Do you imagine that Warren Buffett’s car and driver come out of his taxable income, or perhaps that they are paid for by the company he “owns”? By suggesting that we raise his income tax rate, he is just mocking us wage earners. Just sayin.
“If you are “rich” it is pretty simple to shelter gains from taxation and only take what you need to spend on yourself off the table as “income”.”
Fine, then let’s raise the rates, since it won’t be any trouble to them.
I agree with you that it won’t trouble the most rich much. You are going to get your entitlements clawed back anyway.
Oh great, another fatalist. Blue Skye, the whole point of bringing up the discussion about taxes is to try to avoid having the entitlements “clawed back”.
Your argument is an attempt to demoralize people. To make them think “It’s too easy for the rich. They are going to claw everything from me because they can. I should just give up.” But that is not correct. It would be easy for them to take over if we all just gave up. Our resistance is what prevents that from happening.
“Your argument is an attempt to demoralize people. ”
Ding! Ding! Ding!
Same as the ‘government never works’ propaganda.
There are those that benefit from the idea that the rich are untouchable, and that government- especially government that tries to tax/control the rich- is bad (socialism!).
And those people who benefit are the rich- and their lapdogs.
There is no way to avoid entitlement clawbacks. Even if you believe the medicare and social security trustees reports, the unfunded liabilities are around $45 trillion, yes trillion. That’s a cool $145k that would need to be collected today from every man, women, and child in the country in order to fund future benefits. That is on top of all the dedicated taxes, copays, etc. currently collected for those programs, that need to run into perpetuity as well. If you don’t believe the trustees reports, remember in 1960 they forecasted medicare costs in 1990 would be $12 billion and costs were actually $110 billion, other forecasters have placed the unfunded liability as high as $100 trillion. Either way, the government will be unable to pay these claims. Plan accordingly, you will need much more money than you think to retire. No amount of taxing the “super rich” will change this fact. Even confiscating their net worth wouldn’t be enough. Estimates of net worth for the Forbes 400 richest americans is $1.4 trillion.
No on your presumption of why I think that entitlements will get clawed back. The entitlements are too damned expensive. They cannot continue to grow grow grow forever, so they won’t. My contention is not that the search for justice is futility, it is that the entitlements are unjust and unsustainable, and will not continue as they are.
“That’s a cool $145k that would need to be collected today from every man, women, and child in the country in order to fund future benefits. ”
Assuming your numbers are right, that money would be collected over the course of a lifetime- with the rich paying more, due to their higher earnings, and most people paying less. Tax the rich, capital gains and all, at a reasonable, historical rate, and there’s no problem.
Maybe throw in a universal health care system, so we could join the modern world, and enjoy its inherent savings and peace of mind, and it’s all good…
“Maybe throw in a universal health care system, so we could join the modern world, and enjoy its inherent savings and peace of mind, and it’s all good…”
And give up on the Plantation Atates of America? No way! I like being poor!
“other forecasters have placed the unfunded liability as high as $100 trillion.”
Sources, please.
If we were to eliminate payouts on Social Security, Medicare, and Medicaid immediately, does anyone really believe that the money would be used to pay down the debt? Does anyone believe that our Congress would suddenly become responsible? Would tax rates for us “productive” folks fall?
What would be the effect on the economy when that money is no longer flowing through the economy? Not only will recipients not receive payouts, but all of those federal employees employed by the SSA, etc. would also be unemployed. Can we survive the sudden shift in the economy?
As much as anything, I think this is why Ryan’s plan called for phase in of SS, Medicare, and Medicaid changes.
“Assuming your numbers are right, that money would be collected over the course of a lifetime- with the rich paying more, due to their higher earnings, and most people paying less. Tax the rich, capital gains and all, at a reasonable, historical rate, and there’s no problem.”
The numbers are right. $45 trillion is straight from the trustees reports and the US has a population of around 310 million. My guess is the actual unfunded liability is closer to $200-250K per person as the trustees attempt to paint a more rosy picture. The unfunded liability is in present value terms so if you wait to fund it over time the cost will be larger as every year that goes by you are not earning investment income on the $45 trillion pool of assets required for the plan to be in balance.
Lets tax the super rich at 90%, capital gains and all. Since the super rich don’t earn wage income, according to everyone on this blog, they must earn all their income from their assets. What can theforbes 400 earn from their $1.4 trillion net worth? How about we assume they earn 20% on their net worth annually? A stretcth, I know, but they are so much smarter than everybody else they must be able to generate 20% returns from their assets. The Forbes 400 would then have earnings of $280 billion a year and the US would collect $250 billion in taxes from them. The govt is currently running a $1.6 trillion deficit so taxing the forbes 400 @ 90% barely puts a dent in the deficit, let alone pay for the unfunded medicare liability.
The numbers are staggering. The unfunded liability is as much as 3 times the country’s current GDP using the trustees assumptions and 5-8 times current GDP using other’s assumptions.
The US will eventually default and that default will come in the form of broken promises to the middle class, not from defaulting on its outstanding debt. The course cannot be altered. You can believe in the candy corn crapping unicorn or you can prepare yourself.
Dallas Fed did a study putting the unfunded liability at $100 trillion. The report is available on their website. Google it, you’ll find plenty of researchers who have worked on this topic.
One of the early rationales for a social security system was for stimulus. Charles Townsend’s original plan required seniors to spend it all and not hoard.
Steamed Bean,
45 trillion. who says we have to contribute 145k today and retire that or much pay for it today so future generations will just collect the payoff. the amount will be paid for over generations and paid for partly by those who will benefit from it.
Not sure why we would fund future distributions at 100% today. That would assume that no taxes would be collected in all future years. The problem is actually much smaller than the $45-100 trillion that you mention as it is spread over many decades. Tax receipts will cover those payments.
That would be like saying “Well, we owe $100,000 on the house so even though we have a 30 year mortgage, if we can’t afford to write a check for the full amount today then we must be screwed.” The reality is that you just have to manage your revenue over the next 30 years to ensure you always have enough to make your mortgage payment.
“who says we have to contribute 145k today and retire that or much pay for it today so future generations will just collect the payoff”
““Well, we owe $100,000 on the house so even though we have a 30 year mortgage, if we can’t afford to write a check for the full amount today then we must be screwed.” ”
Thanks for pointing out steamed bean’s propaganda in my absence. Hey, steamy, what’s the Kochtopus paying nowadays?
You guys obviously don’t understand present value actuarial analysis. The $45 trillion unfunded liability is the discounted future value of all future payments required from the medicare system minus the future medicare tax collections. It is the amount required today, when invested at the assumed discount rate and combined with future medicare tax collections, to pay for all the future obligations. Future medicare payments will be much, much larger than $45 trillion. If we had $45 trillion to put into the medicare trust we would not be funding future distributions at 100% today, but rather funding the discounted value of those distributions after collecting future medicare taxes.
Remember, the $45 trillion is the medicare trustee’s estimate of the deficiency and they use more rosy assumptions. The Dallas Fed places a much higher value on the unfunded liability. If you don’t want to cough up the deficiency today, the Dallas Fed’s analysis determined that income taxes would need to be increased by 68% on every american from the time of the analysis into perpetuity, that means forever.
Welcome to the real world folks. The government will default on its promises. We all need to save more.
“the $45 trillion is the medicare trustee’s estimate of the deficiency and they use more rosy assumptions…Welcome to the real world folks. ”
In the rest of the real world, they have universal health care that costs much less to administer than medicare- that is, they don’t let for-profit insurance companies cherry-pick the healthiest for coverage, and leave the expensive for the gov to cover- like we do.
Maybe we could get a little of that in our future real world? Or are you sure our wealthy masters won’t allow it?
And I refuse to fight your straw man, steamy. Who cares if taxing the richest 400 Americans at rates the rest of us already pay won’t cure all our problems immediately? It will certainly help us get much-needed revenue, and in a historically fair way, from those that have benefited the most from the new economy, and who can afford it the most. What the heck is wrong with that? Sure, some benefits will need to be curtailed or redefined or postponed in the future, but that doesn’t let the rich off the hook from finally paying the same tax rates the rest of us worker bees do.
Even if it doesn’t cure a damn thing, fair is fair.
And I refuse to fight your straw man, steamy. Who cares if taxing the richest 400 Americans at rates the rest of us already pay won’t cure all our problems immediately? It will certainly help us get much-needed revenue, and in a historically fair way,
This is why Steamed Bean’s argument doesn’t mean that much.
“And I refuse to fight your straw man, steamy. Who cares if taxing the richest 400 Americans at rates the rest of us already pay won’t cure all our problems immediately?”
It may surprise you alpha to know that I believe the richest americans should pay alot more in taxes. I am merely pointing out the exhorbitant size of some of our more serious problems. And because I speak the truth, and have the numbers to back up my statements I am employed by the kochtopus? The analysis is far from a straw man. It is much more of a straw man to believe taxing the rich will solve the problems. The government has promised benefits far in excess of its ability to pay. Sorry that reality sucks.
““Well, we owe $100,000 on the house so even though we have a 30 year mortgage, if we can’t afford to write a check for the full amount today then we must be screwed.” ”
And this comment gets right to the heart of present value analysis. You could pay for the house with 100k today, or you can pay 200k over time by financing it. Financing it is fine and affordable if the amount financed is around 3 times your income. You will not be screwed. Now let’s look at the government. It has a $45 trillion “mortgage” in the form of its unfunded medicare and SS liability. Obama’s latest budget for fiscal 2011 forecasted all federal revenue at $2.17 trillion. The government has a “mortgage” that is 20 times its income. It is the biggest FB of all times.
It is an incentive to take risk. Dollar fail. Our government needs to get out of the business of providing tax incentives for risk. It has produced a bias toward risk (and consequences) in the system. The incentive to take risk should be directly proportional to the potential to earn profit, and not a penny more.
BTW, the FedGov has an adequate income. It simply knows no bounds on its spending.
Yeah, those $500 million fighter jets and million dollar boots on the ground have a way of doing that.
Oh wait, those are “nondiscretionary” items.
Never mind.
The wealthy and the retired (particulary the wealthy retired and retired public employees) are the onces who don’t pay.
The wealthy get federal breaks. The retired don’t pay FICA, though they did while working, and get the state and local breaks. Especially retired public employees, whose income is exempt from state income taxes in ten states including New York.
Not all public employees pay FICA.
“Approximately five million state and local employees are exempt from Social Security and instead participate in retirement plans administered on the state and local levels.”
You are aware that if you don’t have at least 40 quarters of earnings on which you paid Social Security taxes you don’t collect Social Security when you retire, right? So, yeah, some don’t pay in, but they don’t collect either.
Not true.
Spouses can claim SS without paying into the program.
Widows can claim at age 60.
Many people think of Social Security as just a retirement program. Althought it is true that most of the people receiving Social Security receive retirement benefits, many others get Social Security because there are:
Disabled, or
A spouse or child of someon who gets Social Security; or
A spouse or child of a worker who died; or
A dependent parent of a worker who died.
The widow/widower collects because that is considered part of the benefit the working partner paid for. If both spouses were outside the FICA system, the widow wouldn’t get anything because there isn’t any FICA account to claim on.
I wasn’t talking about disabilty payments. I don’t know if there is any work history requirement for those and don’t have time to look it up.
“…disabilty payments. I don’t know if there is any work history requirement for those ….”
Yes, there is. SSI requires the the same 40+ quarters as SS for eligibility. If less than 40 quarters, one can apply for SSD, also known as “welfare.” SSD stipends are about 1/3 that of SSI.
SSI gets Medicare, SSD gets Medicaid. Neither is enough to live on independently (inside, at least,) in the state of California.
good article. makes the same point i have been making here.
it’s not necessary to raise the top marginal rate on earned/ordinary income above 250K.
its the fracking favorable cap gains and dividend rates that is creating the disparity.
and now they are talking about cutting corporate rates. ridiculous.
Those of you (and there are many) advocating that capital gains should be taxed at income tax rates, be very careful what you wish for.
In front of all, for all to see, there is the debasement of the dollar. This will be accompanied by equivalent amounts of inflation - it would have already been the case were huge amounts of foreign money not been continuously pumped into this busted scheme. With inflation, you will find the value of your dollar-denominated assets shooting up.
When your assets rise in value, you will accrue capital gains. Do you really want to pay for the “fair” rise in dollar value of, say, a company stock just because the stock price kept pace with inflation?
As a data point, there are inflation ridden countries that take the opposite view - have zero or minimum taxes on capital gains - else the liquidity in the system driving industry and infrastructure will evaporate (and find its way in the underground economy).
“there are inflation ridden countries that take the opposite view - have zero or minimum taxes on capital gains - else the liquidity in the system driving industry and infrastructure will evaporate”
One would think an inflation-ridden country would want to evaporate some of that liquidity in the system, no?
And there’s still no reason that income should be taxed higher than capital gains- even in an inflationary environment. Why favor the one over the other? They’re both getting screwed by inflation, but asset holders generally get screwed less by inflation than workers.
No, income is cash flow. Inflation doesn’t cause income. Inflation can cause increases in income, and tax slabs move regularly to compensate for that.
Capital gains, on the other hand, come from two sources - one is that the underlying asset has increased in utility/value, and the other is that the unit that the asset is denominated in has lost value. When the latter factor is large, and when you begin penalizing the asset holder for “virtual growth” that the asset holder never really enjoyed, the tax starts being unfair. And when a tax is unfair, people will revolt against it. In a hyperinflationary situation, I would probably build a big cellar in my house and put all my investments into booze that I can enjoy/sell/barter at a later date rather than park it someplace where I pay a tax for Bernanke’s monkeying.
Taxable capital gains is also cash flow. You don’t pay tax on it until you sell. Reinvesting the cash is a choice.
Polly - I respectfully disagree. Calling this “cash flow” is like terming as “cash flow” the following situation: man has $1000000, man stuffs $1000000 into mattress, every month man pulls out $10000 from mattress - does that become cash flow?
“Gains” refers to any profits from an investment. If the only gains are due to debasement of the unit of measurement, then there is no profit to be had, ergo no taxes to be paid.
Americans aren’t accustomed to operating in hyperinflationary/high inflationary environments and I see a knee jerk reaction here.
Think of it this way. Tomorrow Bernanke floods the market with more money (yeah, what’s new) and suddenly a dollar is only worth tomorrow the equivalent of 50c today. All paper money has lost 50% of value, but since the system is otherwise pretty much the same as earlier, all “value” in the system stays the same, i.e. incomes & asset prices double - causing a 100% “capital gains”, on which magically you owe the government 30% in taxes!
That way, Bernanke could make the deficit go away.
“Gains” refers to any profits from an investment.
——————
“Gains” simply refers to the difference between the purchase price and the sale price, and specificially a situation where the sale price is higher than the purchase price. It makes no presumptions about the underlying conditions that created those two prices.
You are talking nonsense. If you disagree with the basis that determines asset prices in the stock market, you are free to buy assets in other currency denominations or in other parts of the world. Or not buy them at all.
Your beer bunker demonstrates this. In your example, the US has fallen apart due to hyperinflation, but somehow you have the means to create what you deem a legitimate market to determine the value of your beer,( which basically equals sell it to your neighbor), and somehow this is more legitimate than the US’s stock market?? Come on.
yensoy,
Your metaphor is only correct if you tax the entire amount received and do not exclude basis from taxable income. No one on this board has suggested that as far as I can see. All the references are to taxing capital gains - not total amount received on the sale of a capital asset.
Your example has some very small resemblance to a consumption tax, but that hasn’t been raised today.
Polly,
Let’s say you sell me something for $10. Overnight The Bernank rules by fiat that two zeros should be added to every bank note, i.e. hyperinflation. In the morning you want back the thing you sold me. I tell you it’s $1000 and you give me $1000 (my $10 with two zeros added). Now the government steps in and says that you owe capital gains taxes on the $990 you made.
What just happened?
Thanks for clarifying.
I paid taxes because I made a profit on the item I purchased and then sold, although in the circumstance you describe - a declaration that all existing notes have 2 additional zeros added to them - an adjustment might be made. We don’t index capital gains for inflation. Fair? Maybe not. We don’t index income for local cost of living either and my brother could have used that when he ws trying to live on Oahu on less than $20K a year.
That still doesn’t make taxing capital gains the equivalent of taxing the entire amount received without any deduction of basis on the sale of a capital asset.
By saying in this situation that “I paid taxes because I made a profit on the item I purchased and then sold” are you deliberately being obtuse? In the circumstances I described you clearly did not make a profit, yet you must pay taxes. Clearly no adjustments are made and capital gains taxes aren’t indexed for inflation.
Isn’t this situation yet another reason that inflation is a stealth tax?
I’m not being obtuse. I made $990 of profit. That is how tax is measured - in dollars unadjusted for inflation. Just like a family living in Manhattan and making $150K pays tax at the $150K level even though they are much less well off than if they made that $150K in Akron. Trying to adjust for inflation (or cost of living in a particular location) is, evidently, too hard to administer so it isn’t done. As far as I know, people have been talking about it for as long as capital gains have been subject to tax and I can’t recall any serious push to do an adjustment. We certainly talked about in my baby tax class in law school. The professor dismissed it out of hand and he was no liberal.
It still isn’t the same as saying that taxing capital gains is the same as taxing the gross receipts from the sale of a capital asset which basically is what yensoy was asserting, though he added a time delay element to it.
‘Oooh! But what if we have hyperinflation?! Then the poor rich will be paying high tax rates!’
And won’t the worker bees get bitten in the a$$ too, when their devalued but increased income is taxed at higher rates?
But there’s only tears and fears for the poor rich.
Polly please don’t misquote me. This is not about taxing gross receipts.
It is about taxing the difference between sale price and purchase price, where said difference has been caused by the natural process of inflation (i.e. deflation of the underlying metric of valuation). That is just plain wrong. I don’t understand why you are still defending it.
When your assets rise in value, you will accrue capital gains. Do you really want to pay for the “fair” rise in dollar value of, say, a company stock just because the stock price kept pace with inflation?
——————
Capital gains taxes on stocks don’t work that way. You don’t accrue capital gains taxes, you are assessed them when you sell your assets. If you are selling your asset, then you must have thought:
1) the gains on it in the future were not going to surpass your risk premium (which typically includes an accounting for inflation)
2) there was another asset you found offered a better return
3) or you needed some liquid cash.
None of these reasons for selling has any direct link to inflation.
Finally, if you are concerned about a stock not appreciating at at least the rate of inflation, why would you buy it in the first place? There are safer inflation hedges.
Buffett paid 17.7 percent in taxes on the $46 million he booked that year, while his secretary lost 30 percent of her $60,000 salary to the government.
—————-
How is the secretary paying 30% in taxes? My family makes in the low 6 figures, has almost no deductions beyond the std, and our effective federal tax rate was 12%. No way a secretary with a $60k income has a higher effective federal income tax rate than that.
Sounds like you are only counting Federal income taxes. The 30% likely includes a number of other taxes like FICA and possibly state and local. And, assumuing the secretary is older than you, she may be filing as single with only one exemption rather than as a head of houshold with multiple exepmtions.
Or married filing jointly with multiple exemptions.
Perhaps, but they don’t take FICA or other taxes out of capital gains, so it’s not an apples to apples comparison. Besides, Buffett has a job so he pays those taxes too. They also don’t make any points in the article about removing the cap on FICA & employment taxes nor about adding new taxes to the capital gains umbrella, so I don’t feel it is my point to make assumptions for the article.
Finally, although FICA and other taxes are taken out, its debatable to call them out as part of the ‘federal tax bill’ when discussing federal income taxes. FICA’s and unemployment are more like forced savings than taxes.
I’m not saying that sec’s taxes are too low by any means, nor that Buffett’s should be any less. I think Buffett’s should be more.
I’m simply saying she most likely has a lower effective tax rate than Buffett.
Coincidentally, I managed to make approx $60K last year, as a newly minted “contractor”.
$12K of which went to the Feds, and $2500 to the state income tax.
This doesn’t include fuel taxes on the 30k miles I ended up driving, or the local 9% sales tax. In Red-State, “low-tax” BFE.
As my accountant said, if all you have to sell is labor, you are fooked.
That cardboard box under a San Diego overpass is looking better all the time.
And the “rich” are either going to have to ante up, or outsource themselves. Why? Because us turnips are out of blood.
You didn’t include state taxes, Social Security, and Medicare. Most of us pay around a quarter of our incomes for that.
You didn’t include state taxes, Social Security, and Medicare. Most of us pay around a quarter of our incomes for that.
I agree that those are paid, and I’d say more than a quarter. But Buffet and his secretary both live in the same state, so to the point and rate that those taxes are applicable, they are paid equally.
Does any state differentiate captial gains from ordinary income (beyond the std housing loophole)? I can’t think of any.
I’m sure Buffett buys more stuff than his secretary does, but I’m sure that calculation doesn’t include his sales tax. I’m just saying 17% to 30% is not an accurate apples to apples comparison.
They need to release the photo(s) of Osama Bin Laden. The story they have been telling doesn’t make any sense. If they really wanted to make sure he was buried within 24 hours, then why did they take his body to begin with. Normally, when a person is killed in a war, the body is left on the ground to be buried by that person’s own people. The only reason to take a body is for proof. If they wanted to show proof of the kill, then they should have kept the body and produced it in some public forum. At the very least, a photo is in order.
This is not a popular thing to say. The PTB knew that the sheeple would lap this news up, big time.
Given the gov’ts track record with fudging facts I too am very skeptical that we are hearing the entire truth. But tell that to others and you will be labelled a conspiracy nut.
It was the same attitude when Bush was lying to our faces. I wanted him to show us the evidence of the purported weapons, but in the end I gave him the benefit of the doubt because he was our President. A lot of people did that. It actually made sense at the time because we were not accustomed to being lied to like that. But I do not think there is a good excuse for people to make the same mistake twice. Presidents can lie.
Big V, I agree with you on this. However, our Prezzy likes to “move on”, and I’m all for that, provided that we move on out of Afghanistan, the sooner the better. Declare victory and get the snot outta there.
Jeez, I’m so sick of these endless wars and conflicts in the Middle East and elsewhere.
The message however is we can’t stop the war on terror now. We have to keep up the fight.
Killing Bin Laden has increased support and made Americans feel better about the war in Iraq and Afghanistan and Libya.
Which is why I smell a rat.
Leave the body then you leave someone to fill a gravesite, a place that can become a holy place.
No body = no gravesite = no holy place.
What an absurdity. Osama’s followers can make a holy site out of the ground where the blood was spilled. Besides, the military claims it tried to get some other country to take the body, but that country declined. Could a holy site not have been formed in that country (I think it was Yemen, not sure)? They did not take the body to prevent a holy site from forming. That sounds like a lame excuse being advanced to cover up a bad lie.
“Osama’s followers can make a holy site out of the ground where the bllod was spilled.”
This is true but it would have a diminshed effect.
For example, the Alamo is in a sense a holy site but there are no graves to visit because they were all burned by Santa Ana. Imagine the number of visitors to Davy Crockett’s gravesite if there was one.
Look at how many people in Russia visit Lennin’s tomb.
With a body one has a choice as to where to put it; this choice is not granted to a physical site.
A place such as Mecca would be a great draw to Osama’s followers if the body was put there. Or maybe preserve the body as Lennin’s body was preserved and take him on tour.
You did not address the problem with their change of story. They originally said that they tried to find a grave site for him, but couldn’t find a country to take him. Now they’re saying the didn’t want him to have a grave site.
Inconsistent, illogical, and unbelievable.
“Imagine the number of visitors to Davy Crockett’s gravesite if there was one.”
I’m imagining it, and what’s coming up is a sea of the sons and daughters of Aztlan protesting the racism of the gravesite.
“They originally said that they tried to find a grave site for him, but couldn’t find a country to take him. Now they’re saying the didn’t want him to have a grave site.”
Hint: the PTB don’t owe you an explanation.
“A sea of the sons and daughters of Aztlan protesting”
What a racist thing to say, on this holiest day when the US celebrates nationwide a military battle between two separate, foreign nations, outside of US soil 149 years ago.
LOL, Left Ohio.
By the way, I have a new name for those who cry “racist” at the drop of a hat:
RACERS! Goes nicely with birthers and truthers, the addition of “er” apparently being used to brand someone as a nutjob.
I suppose Nascar Nation won’t like it, but what can I say?
rms:
Of course the PTB owe us an explanation. We are the people who vote them in and out of office. We are the people who are paying for this very expensive operation.
“A place such as Mecca would be a great draw to Osama’s followers if the body was put there. ”
That would considered blasphemy in Islam. Only the prophet can be revered. Anything else would be idolatry.
Colorado…
OBL, son of high and mighty, rejects his lineage and wealth, takes an oath of poverty, champions the cause of the poor and oppressed and is then executed.
Remind you of anyone?
“Remind you of anyone?”
I’m not sure who you mean. If you mean Jesus, he never rejected his lineage (House of King David)
I should have been more specific. Rejected the rights, benefits and status of that lineage.
I seem to recall Jesus saying “He who lives by the sword, dies by the sword”, I don’t ever recall reading that he ever called for a Jihad against infidels. If anything he said to turn the other cheek.
In Colorado:
You are correct that Christ is said to have acted very differently than Mohammed. However, Muslims revere people other than the prophet all the time. They revere martyrs. It’s not idolatry.
“They revere martyrs. It’s not idolatry.”
I agree, but they won’t build shrines for them either. One thing that makes Mosques different from Churches is that they have ZERO imagery in them. No stained glass, no mosaics, etc. They can be very ornate with patterns, but the idea is that nothing inside the Mosque should distract the faithful from God and the Koran.
They can be very ornate with patterns, but the idea is that nothing inside the Mosque should distract the faithful from God and the Koran.
A good example of the ornate patterns can be found at the Alhambra in Spain. Gorgeous place.
That is the difference but not there is no difference for those he championed and that is my point.
“America will never dream of security unless we will have it in reality in Palestine,” he added. “God willing, our raids on you will continue as long as your support for the Israelis continues.” –Osama bin Laden
The likely outcome is that there will be more martyrs like Osama bin Laden because the conditions that inspire this sort of terrorist continue to exist.
Glad to see you have your talking points aligned.
The vast majority of “news” is made up stuff. Not made up by our President, made up by the media. It is obvious in the coverage of the OBL story. Hard to have a logical discussion on that basis.
“The vast majority of “news” is made up stuff.”
Absolutely, Blue Skye. Not to mention PR made to sound like news, but misses the mark. Product/Service PR targeted at early adopters isn’t news. The Engineering Of Consent isn’t either.
And the news was made up by the media when Bush was in office as well, I presume? LOL!
Today’s media can’t find their a$$ with both hands. They depend on handouts, err press releases, and briefings (spoon-feedings) by press secretaries and publicists.
“And the news was made up by the media when Bush was in office as well, I presume? LOL!”
You betcha! Judith Miller comes to mind. Of course, hers was one of those public/private partnerships the neoCONS get all moist with delight over. Worked for them!
Heckuva job, Judy! Nine years, billions of dollars and dead and maimed bodies all over the place.
My point exactly Palmy. The administration makes up the news and feeds it to their favorite syncophant (sp?) outlets. But that administration includes, is led by, the president.
Thank you for pointing out that example.
No this is what they should have done.
They should have taken a nice juicy stick of radioactive substance (polonium?), embedded it into his body and left the body right there. His followers would have picked up the body, made a huge funeral procession, and finally buried it in a tomb. That radioactivity would be a great way to render all his followers, worshipers and tomb visitors sterile.
Yen, have I ever told you I like your style? I may not always agree with you, but I sure enjoy your posts.
Thank you - same here - I don’t always agree with you buy enjoy your point of view and expression thereof.
HAR!
No body = no gravesite = no holy place.
IIRC the only human Muslims are only allowed to venerate is “The Prophet”.
Osama Bin Laden Killed - Dead Body Photo - Warning Graphic Image
The following image of Osama Bin Laden’s dead body (face) forwarded to the MO is purported to have been grabbed from Express TV, Islamabad, Pakistan. (unverified)
http://www.marketoracle.co.uk/Article27879.html
That image is a fake.
They don’t want a memorial. A grave would be a rallying point and give inspiration to future terrorists.
I think it was a brilliant move. Gone and soon forgotten
Which is why Obama went to the hole in the ground that was the twin towers. Because of all the people buried there.
And which is why Muslims visit Mecca, because Mohammed ascended to heaven in Jerusalem.
Good point. There is no tomb for Mohammed.
The Dome of the Rock covers the spot he ascended to heaven.
Its also the same spot Abraham was asked to sacrifice his son and it’s right next to the Wailing wall.
It’s a good thing those groups get along so they can all enjoy those sites together.
Mecca had a holy site before Muhammed. They were famous for all the religious relics. Had a thriving tourist industry. Muhammed was of the opionion that the relics and such were worshiped as god or god’s. He went into the place where all the relics were and destroyed them but did not destroy any christian relics as they were based on “the book”.
The place in Mecca that the people all march around is the building that held all the relics. (Mecca was a holy city before Muhammed was born)
Muhammed preached against worshipping idols and that is why there can be no picture of him printed. It would make him an idol. He was very clear to his followers that he was not a god.
I am most certainly not a muslim but I did read up on him. He was against paganism and did not tolerate it. He had no problems with Christians or Jews.
Mohammed was a schizophrenic who was used to form a powerful nation. The entire religion was designed specifically for political reasons.
Exactly. Capped him, wrapped him, and scrapped him in the deep blue. No tomb, no funeral for his followers.
The conspiracy theorists are eternally unsatisfiable- look at the birthers.
I have a neighbor who is a diehard conspiracy theorist. You name the conspiracy theory, it’s part of his treasured collection.
He’s not the only conspiracy theorist I’ve know during my time on this earth. I’ve noticed that these folks have something in common: They’re not very tightly wrapped. And it doesn’t take much to get them going on whatever conspiracy theory that happens to be bothering them at the moment.
When it comes to dealing with this neighbor, I tend to make the phone calls very short. When he gets on a roll, I just excuse myself by saying that I have to tend to something on the stove. Or that I need to make some other calls before the day is over. I also delete a lot of his e-mails.
I try hard not to become “that guy”. The stuff that actually is happening makes that difficult sometimes. Especially lately.
“I have a neighbor who is a diehard conspiracy theorist.”
One of these days, he is going to be right.
Conspiracies, large and small, are hatched all the time. Most of them fall apart pretty quickly.
The smallest conspiracies are those I hatch with myself to fool myself.
There is a big difference between “conspiracy theorist” and “person who sees HUGE holes in a story because she has eyes”.
And that includes Koch-suckers like yourself, heh heh.
There are some Koch-suckers here, but I’m not one of them. They’re the twits defending the mega-rich, since you seem confused.
Even more brilliant than you think.
Wiki: “Hagfish”
Withholding the photo was a no-brainer.
True story: When she taught high school, my mother had a colleague named Michael Berg.
You might have heard of his son, Nick Berg. He was kidnapped, then beheaded, in Iraq back in 2004.
If you’re interested, you can find the video online. I’ve never watched it and have no intention of doing so.
If we were to release the photo of the deceased bin Laden, I think we’d be stopping to the same level as the people who video-ed the killing of my mother’s colleague’s son. And then shared it online.
Hey, you have to have NO BRAIN not to demand evidence that this very sketchy story is actually true.
Cross and Double Cross With Gitmo Files
Did the Wikileaks force Bin Laden’s capture??
US Knew Where Osama Was Since 2005
By Israel Shamir
May 04, 2011 “Counterpunch” — The unredacted Guantanamo files show clearly that the trail to Abbottabad was known to the US intelligence services at least since 2005, when al-Libi, another Abbottabad dweller, was captured.
Timing is everything. The US President announced killing of Osama bin Laden just as Wikileaks completed its publication of Guantanamo files. Was it coincidence? If not, what was the connection?
Wouldn’t be the first time that the intelligence agencies left a target in place, to monitor their communications, visitors, etc.
The “intelligence” that was removed from the house could be all the listening/monitoring devices. They could have been installed when the place was built. Not like that hasn’t been done before.
Speaking of Wikileaks, aren’t they overdue with their promised release of BofA documents?
For the same reasons that the Russians burned Hitler’s body, and the Brits buried Himmler secretly in an unmarked grave.
They didn’t want their grave to become a new site for the fanatics to “worship”, and why should they have a marked grave, when they caused hundreds/thousands of other people to be “unknowns”.
Assuming, of course, that it WAS OBL/Geronimo.
Unlike our friend Palmy, I believe our government is too stupid, and too many people like to run their mouths, to make his scenario likely.
But as much BS as our government spews daily, I can see where we could have a difference of opinion.
Dude, does Sadam Hussein have a grave? He was executed on the internet. Suddenly we have a policy against gravesites and public displays of deadness?
MAKES - NO - SENSE
“Dude, does Sadam Hussein have a grave? He was executed on the internet. Suddenly we have a policy against gravesites and public displays of deadness?”
To the radical Muslims, Hussein is no Bin Laden. From what I remember, Hussein hated that fringe. Second, Obama wasn’t president when Hussein was killed. I really can’t see Obama keeping Hussein’s handgun in the Oval Office as a keepsake.
What would Bush have done? Maybe wishful thinking here, but I think he would have treated this completely differently than he did the killing of Hussein.
Well, Obama needs to treat it differently too. Opacity and double speak will get him nowhere with me, if that counts.
Can’t pay the mortgage? Maybe the bank will pay you to leave
It’s the kind of news that seems to defy all logic we’ve ever been taught about financial responsibilities and rights in the real estate world. Now, says the Financial Times, banks are considering paying cash-strapped “homeowners” to vacate foreclosed properties.
According to Times article, the “five biggest US mortgage servicers were told this week at a private meeting with regulators to consider paying delinquent borrowers up to $21,000 each as part of a broader settlement of the foreclosure crisis.”
This proposed program, cutely named “cash for keys,” asks that America’s biggest lenders, (including, possibly, Fannie and Freddie, as well as Bank of America) pay an incentive to get borrowers to leave their homes quickly, and in good condition.
Why would banks even consider this?
An estimated 4.8 million Americans are currently 90+ days behind in their mortgage payments, meaning that many homes are about to hit foreclosure. Among this huge number of borrowers, many would, under this program, be eligible for “up to $1,000 to seek independent financial advice and up to $20,000 in cash as a ‘fresh start’ payment towards living costs in a new home.”
In fact, “cash for keys” is not entirely a new idea. Courts are totally unable to keep up with the number of foreclosure proceedings initiated since the real estate value crash: In hard-hit Florida, California, Arizona, and Nevada, the overload has forced retired judges to return to help, but no state has a system in place for this never-seen before crisis.
As Elizabeth Weintraub of About.com puts it, “Kept under wraps by the banks for years, the subprime mortgage meltdown of 2007 — which led to an onslaught of foreclosures — forced many banks to initiate a cash for keys policy as standard procedure.” Now cash for keys may become national policy.
http://www.sfgate.com/cgi-bin/blogs/ontheblock/detail?entry_id=88207 - 72k -
Someone has been drinking too much kool-aid! If I can get $21k to leave a house I would do it in a heartbeat, but I am not going to ruin my credit for $21k.
Their credit is already ruined. They are 90+ days late. That’s foreclosure territory.
“Someone has been drinking too much kool-aid! If I can get $21k to leave a house I would do it in a heartbeat, but I am not going to ruin my credit for $21k.”
If you had been living in a house for 3 years without paying the mortgage, credit is not an issue. At that point it ain’t kool-aid, it is $21k icing on top of a triple layer Donald Trump wannabe serial refinancer Robo signed sub-prime victim Countrywide cake, that I fear is soon to become national policy. Sheila Bair did say we needed a Foreclosure clean-up fund on 60 Minutes so “homeowners” would accept a bank’s ownership claim without a lawsuit.
” She thinks a large clean-up pool funded by the banks that would pay homeowners to accept a bank’s ownership claim without a lawsuit is necessary. “I would assume it would be billions [that the fund would
need],” Bair tells Pelley.
If you had been living in a house for 3 years without paying the mortgage, credit is not an issue. At that point it ain’t kool-aid, it is $21k icing on top of a triple layer Donald Trump wannabe serial refinancer Robo signed sub-prime victim Countrywide cake
Does that come with a glass of milk? I need some something to wash it down.
“Does that come with a glass of milk? I need some something to wash it down.”
I believe so, but I think the milk comes from cows in Japan with above normal levels of radiation.
“eligible for “up to $1,000 to seek independent financial advice and up to $20,000 in cash as a ‘fresh start’ payment towards living costs in a new home.”
And next tax season they get the 1099 for the gift money that they spent and can’t pay their taxes. Justice will be done!
“And next tax season they get the 1099 for the gift money that they spent and can’t pay their taxes. Justice will be done!”
Hell, I pay taxes on everything I earn. Give me $20k and I will gladly pay the taxes on it.
jeff
You’re abolutely right. Sign me up, too! They key word was “earn”.
“consider paying delinquent borrowers up to $21,000 each ”
I wonder how they determine who gets how much? Dependents, supposed value of the house, or how risky/desperate they think you are.
Here’s an novel idea….
Get the F_ck Out of the house. Don’t wait. Don’t delay. Don’t duck and weave. GET OUT. You paid too much, now you can’t pay, you’ve gone delinquent and now you’re in default which means you don’t own it anymore. GTFO NOW.
But then you will have to pay rent.
But I love the line of thinking.
-Loudly announce a $21K “incentive” to get people out of the foreclosed properties.
-Quietly add a “clawback” provision on the IRS 1040, a bill that no FBer can escape.
It’s the kind of news that seems to defy all logic we’ve ever been taught about financial responsibilities and rights in the real estate world. Now, says the Financial Times, banks are considering paying cash-strapped “homeowners” to vacate foreclosed properties.
Three blocks away is a house that’s been vacant since last November. It was purchased by an investor back in 2007 and it was listed in the county assessor records as being owner-occupied. It never was — he always rented it out.
I spied the NOTS there a few weeks ago. And there’s also a “we’ll pay you to go away now” offer that a local real estate agent posted back in March.
Well, sorry, real estate agent, because this owner has abandoned the property. He probably wasn’t paying the mortgage, the tenants probably started getting interesting mail from the bank, and you can pretty well guess the rest.
So were they going to pay the tenants to leave? I’d consider moving out of my rental house for $21k. Make it $40k and it’s a done deal.
Obvious reason is that by the owner accepting the money and transferring the property to the bank, it cures all of the problems with lack of documentation being held by the bank!
Might be cheaper than fighting each foreclosure with a chance of losing it all.
Texas: puts an innocent man in jail for 18 years.
He gets out, so they refuse to pay him the $1.44 million state law says they owe him.
Then they attach his wages for child support he owes.
Why does he owe it?
Texas: puts an innocent man in jail
http://www.dallasnews.com/opinion/editorials/20110502-editorial-graves-should-not-have-to-accept-an-iou-on-justice.ece
at least credit Fark for the “headline”
DETROIT (WWJ) – According to a new report, 47 percent of Detroiters are ”functionally illiterate.” The alarming new statistics were released by the Detroit Regional Workforce Fund on Wednesday.
WWJ Newsradio 950 spoke with the Fund’s Director, Karen Tyler-Ruiz, who explained exactly what this means.
“Not able to fill out basic forms, for getting a job — those types of basic everyday (things). Reading a prescription; what’s on the bottle, how many you should take… just your basic everyday tasks,” she said.
“I don’t really know how they get by, but they do. Are they getting by well? Well, that’s another question,” Tyler-Ruiz said.
Some of the Detroit suburbs also have high numbers of functionally illiterate: 34 percent in Pontiac and 24 percent in Southfield.
“For other major urban areas, we are a little bit on the high side… We compare, slightly higher, to Washington D.C.’s urban population, in certain ZIP codes in Washington D.C. and in Cleveland,” she said.
Tyler-Ruiz said only 10 percent of those who can’t read have gotten any help to resolve it.
The report will be used to provide better training for local workers.
Mike Bloomberg has the answer! Send immigrants to settle Detroit!
Yeah their ENGLISH skills will be better then the natives.
And they would want to learn how to be good Americans..and stay out of jail
Wats rong wid dattttt?
In the meantime let’s provide even more funding for public school systems.
If there is a self selective process driving the children of literate, ambitious parents out of the city’s public school system, then blaming the school system does not solve the problem.
If, in addition, there is a self selective process driving the better teachers to leave for easier environments, then blaming the remaining teachers does not solve the problem.
If Detroit’ schools system already has less money available than suburban schoold districts or if its funding has dropped due to declining population and property values, then an additional reduction in funding will not solve the problem.
What is your solution? Would you abandon public schools altogether?
That pawn shop show on A&E proves that no one in Detroit understands interest rates.
And I am sure the casino in Detriot proves they don’t understand probability either.
I thought the housing bubble proved that hardly anyone ANYWHERE understands interest rates?
That show is deeply, deeply depressing. I’m sure that the producers wanted to make it somewhat more raw than the more good-natured “Pawn Stars”, but even a short 5 minute clip of “Hard Core” is bound to take the wind out of anybody’s sails.
I’m sure that the family who runs it makes a ton of money, but they must have a unique knack for dealing with an insane level of stress.
“Not able to fill out basic forms, for getting a job — those types of basic everyday (things). Reading a prescription; what’s on the bottle, how many you should take… just your basic everyday tasks,” she said.
Back in the late 1990s, I was at a local business meeting. I got to talking with the owner of a tire store. Business had been family-owned for quite some time, and she was taking it over after her dad stepped aside.
She was telling me about a problem she was having with job applicants: Very few could read or write well enough to complete the company’s standard employment application. Which meant that she had a tough time filling positions.
That woman’s name: Gabrielle Giffords.
Interesting story. But stories like that always make me curious…it seems like the solution was simply to accept the lack of literacy and stop requiring it during the application process OR pay enough to attract the desired literacy level?
True story from my bike shop days: One of my coworkers was illiterate. Which meant that he wasn’t a very productive worker.
All of us were required to run the cash register, but Andy was such a screw-up at that task that the boss ordered me to do all the customer checkout. So I did.
Then there were his bike repairs and parts installations. If anything required the reading of instructions, guess who got to do it. Me, that’s who.
Mind you, this was in a bicycle shop, not a tire store. That’s a higher level of mechanical work than we did, and, get this. It required the ability to read factory service manuals which were a good deal more chewy than what we had in the bike shop.
“Very few could read or write well enough to complete the company’s standard employment application.”
I haven’t had to fill out many employment applications, since my resume is usually all that’s required. But the few that I have seen contain ambiguous and poorly worded questions.
Illiteracy is a HUGE problem in this country. That’s what happens when you reduce most of your working population to working poor.
And if you are having trouble attracting quality workers, you need to pay more. $12hr or less does NOT pay the bills these days.
Even the working poor have access to free schooling through age 18, don’t they? How long does it take to learn to read?
I think the mechanics of reading are pretty easy for most people, but I notice (based on comments in newspapers and on various boards) that a lot of people have trouble with comprehension. And these are people that would be considered functionally literate.
That was the problem with my bike shop coworker.
He would read things — like installation instructions for a bike part — then do what he thought was best. Sometimes it worked, other times it didn’t.
He also wasn’t very good at understanding product labels. This was made very clear to me when a customer brought in a bike with 27″ rims.
Onto those rims, Andy had shoehorned 700C tires, whose diameter is about 6mm less than that of 27″ tires. Customer wasn’t too happy when I told him that the (recently fired) Andy had put installed the wrong tire size.
Warm bodies are needed to feed the kids. No, they cant eat themselves, but will be replaced by another…although she wants a better job; Linda my lunch lady wife does not live lavishly
“I don’t really know how they get by, but they do. Are they getting by well? Well, that’s another question,” Tyler-Ruiz said.
Well, they’re living in Detroit, so I guess not. Water has a way of finding its own level.
I wonder if Detroit is in worse shape than other cities because more of the literate people left and more of the illiterates stayed.
This could also be true of city public schools in general. The children of literate parents would tend to be better off and more able to escape to suburban or private schools. Better teachers would tend to leave city schools in favor of less troublesome environments, decreasing the effectiveness of schools.
I don’t know about Southfield, but Pontiac was pretty ghetto in the 70s. Based on the general decline in the Detroit economy, I would expect that it hasn’t improved.
I wonder if Detroit is in worse shape than other cities because more of the literate people left and more of the illiterates stayed.
I can tell you from my personal experience as a University of Michigan student that the people with the get up and go got up and left Detroit.
That started happening in the Sixties, and the exodus wasn’t just among the white people. I had more than a few black classmates who made it quite clear that they were putting Detroit in their rearview mirror.
In worrying sign, first-time claims for jobless benefits spike
Yahoonews
In the latest worrying sign for the economy, the number of Americans filing first-time claims for jobless benefits spiked last week–the second straight week it has done so.
Initial claims for unemployment benefits rose to 474,000, an increase of 43,000 from the previous week, the Labor Department said. In the last two weeks, the number has risen by a total of 78,000.
The four-week moving average, which smooths out volatility in the data, rose to 431,250.
Last week, the government reported that the economy grew by just 1.8 percent in the first three months of this year. And yesterday, we learned that private-sector firms added a disappointing 179,000 jobs in April.
The government’s monthly jobs report, which includes both private- and public-sector employment, is due out tomorrow.
Gee who predicted that printing money and allowing WS to drive up the price of food and fuel would increase unemployment and hurt the service sector.
We did. I’m sure the PTB knew this as well but they don’t care.
“Initial claims for unemployment benefits rose to 474,000″
Let’s shoot for 500K!
Si se puede! (In honor of CInco de Mayo)
Maybe now they’ll start taking the ill effects of those fuel and food prices seriously instead of just dismissing them through technical jargon.
I wouldn’t bet on it.
The Feds at this point have an incentive for a big chunk of the population to die premature deaths. Especially if the millions of people who are going to be permamantly unemployed, and/or get demoted into a Third World society finally figure out which direction to direct their wrath.
We won’t have “death camps”. We’ll have policies that promote premature deaths. But they won’t be called what they are. They will be called “Let the free market decide….”
Like our current health care system. Bump the number of uninsured Americans up to 50-60%, and Medicare’s long term problems are solved.
If that is indeed the game then it’s a very, very dangerous one. The fates of the parents will not go unnoticed by the children. What’s to say they (youth) might not start reacting in ways unsupportive of the status quo? In some ways, they already are.
Illiteracy, sports and Dancing With American Idols, that’s what.
1) guillotine on Wall Street (with shuttle service from Greenwich)
2) guillotine on Capitol Hill (with shuttle service from K Street)
3) re-education “camps” for allegedly innocent spouses and children of wall street pigmen and congresscritters, to help them acclimate to $12/hour New Normal
You are correct GSfixer.
And if that fails, there’s always world war. And may be yet.
But, but factory orders are UP! And so are retails sales! And we’re exporting oil and gasoline because we have so much!
Hundreds Protest Wells Fargo Shareholder Meeting in SF
05.04.11 - 10:33 am | Sarah Phelan |
The New Bottom Line, a national campaign to hold banks accountable for foreclosures, kicked off in San Francisco this week, as hundreds marched through the Financial District to demand that Wells Fargo change corporate policies that bankrupt families, dismantle neighborhoods, and empty public coffers.
During the bank’s annual May 3 shareholder meeting, a group of homeowners and clergy addressed Wells Fargo CEO John Stumpf to demand a foreclosure moratorium.
According to protest organizers, which include Contra Costa Interfaith, ACCE (Alliance of Californians for Community Empowerment) and other members of the New Bottom Line Campaign, unlike other national banks, Wells Fargo has not changed its foreclosure procedures despite reports of “robo-signing” and other foreclosure irregulalities.
“Since 2005, I have been fighting Wells for wrongful foreclosure,” San Leandro resident Donna Vieira said in a press statement. “But through this process, I have learned that I am not alone. A quarter of foreclosures in this country happen right here in California and 700,000 families are in foreclosure right now. We need these banks to have a new bottom line that includes investing in our communities.”
The New Bottom Line Campaign notes that, according to the U.S. Departments of Treasury and Housing and Urban Development, 350,169 Wells Fargo homeowners were eligible for the Home Affordable Modification Program (HAMP) by the end of 2009. But as of Feb 2011, only 77,402 homeowners have received permanent modifications.
Protestors note this only amounts to a 22 percent modification rate, more than two years after the HAMP program began. They also charge that Wells Fargo has canceled 118,697 trial modifications and denied 175,336 homeowners from accessing HAMP. But during this same two-year period, Wells Fargo received nearly $43.7 billion in federal bailout funds, according to a study by the nonpartisan think tank, Nomi Prins of Demos. And in 2010, Wells Fargo reported to the Securities and Exchange Commission that it paid its CEO John Stumpf more than $17 million, including a $14 million bonus.
Protestors also claimed that, over the last ten years, Wells Fargo has paid the lowest worldwide tax rate of the top five biggest banks and did not pay federal taxes in 2009.
…
““Since 2005, I have been fighting Wells for wrongful foreclosure,” San Leandro resident Donna Vieira said in a press statement. “But through this process, I have learned that I am not alone.”
No sh#t Sherlock.
How the heck could someone be foreclosed upon in 2005, with house prices at all-time highs? Just sell the house.
“Wells Fargo has paid the lowest worldwide tax rate of the top five biggest banks and did not pay federal taxes in 2009.”
Taxes are for the little worker bees.
Which, according to Freedom to Fascism, was not the original intent. Originally, for tax purposes, “wages” were not considered “income”, as such. “Income” was considered to be such things as rents, interest payments, payments from trusts, capital gains and other investment profits, dividends, etc. Mostly passive streams, but not always.
Now, I’m no legal expert, but this makes sense to me, in that our legal system is largely based on English common law. Anyone familiar with the works of Charles Dickens and other English lit will recall that one of the concerns of English citizens was having a private “income”, from an inheritance, trust, landholding, investments, etc. The book Great Expectations illustrates this. Through a private “income”, the person was relieved of having to work for a living, which especially in Victorian England was a miserable proposition. An impoverished gentlewoman would have to go into service as a governess, maid, housekeeper, etc. “Wages” were meager.
Of course, there was another form of remuneration for professionals such as doctors and barristers: fees for services rendered. Not sure how that was treated.
In any case, “income” for tax purposes was supposed to be money from the sources I mentioned in the first paragraph, not “wages”. Of course, those who receive “income” were very good at turning this around. So now the “worker bees” with their meager “wages” pay a bogus “income” tax, their employers having been pressed into service by the state, while those with “incomes” practice avoidance, since they don’t receive a paycheck that can be policed and deducted from.
I think we’d see a whole different proposition if taxation followed the original intent.
And of course, those working for wages pay other taxes: sales, property, gasoline, etc., etc. But leave the wages alone. Tax the “income”, the way it was originally intended.
So we’re going to hold them accountable for their foreclosure procedures, but not for the policies that led to the reckless lending to begin with?
The Good News
Despite the Great Recession, which wiped out $15.5 trillion in household wealth in the United States alone, the number of millionaires in this country and abroad will grow rapidly over the next decade.
In the U.S., the total number of families with a net worth of over $1 million, including real estate, will double by 2020, according to a report by the Deloitte Center for Financial Services.
The Bad News
These people will be living what now is considered a lower middle class life style.
Ain’t inflation beautiful?
This takes on even more meaning when one starts to examine what exactly constituted that $15.5 T in “lost wealth”. RE wasn’t the only thing that was overvalued in the past two decades.
With enough hyperinflation everyone’s a millionaire!
Best part is that you get to pay taxes on it!
Ain’t inflation beautiful?
No. My local pizza place raised prices >10% a week ago
GLOOM, DESPAIR AND AGONY ON ME
From the TV Show “Hee-Haw” (1969 -1992)
Buck Owens & Roy Clark
Gloom, despair, and agony on me
Deep, dark depression, excessive misery
If it weren’t for bad luck, I’d have no luck at all
The value of my house took one big @ss fall
We figured we was rich, and loaded to the hilt
We bought us three spec homes before they was built
‘Cause we heard for years how housing did well
Now we can`t pay our bills credits all gone to hell
Gloom, despair, and agony on me
Deep, dark depression, excessive misery
If it weren’t for bad luck, I’d have no luck at all
My Real estate holdings have took one big @ss fall
We took out money and went on some trips
We put in a pool and did a few flips
Bought a Mercedes and thought we`d go far
The Damn Repo man just drove off with my car
Gloom, despair, and agony on me
Deep, dark depression, excessive misery
If it weren’t for bad luck, I’d have no luck at all
But before they evict me I`ll bust every wall
“But before they evict me I`ll bust every wall”
Wow — this story is as old as the hills! Any idea of the exact vintage of that song? I am wondering which U.S. housing bust it represents…
I’m pretty sure the original song from Hee Haw didn’t contain most of those lyrics, so I assume he just made them up today.
If so, then kudos to Jeff!
Those are part original and part new lyrics.
Now we’re not ones to go ’round, spreadin’ rumors…
CNBC Real Estate Reporter
Barely a few minutes after reading an article in the Wall Street Journal about banks finally opening the “spigot for commercial real-estate,” the folks over at Trepp issued their monthly report on the delinquency rate for commercial mortgage backed securities (CMBS); let’s just say it isn’t good.
After two months of very minimal rate increases, the number jumped in April, 23 basis points, to 9.65 percent, “the highest reading in the history of the CMBS market,” according to Trepp.
I’m seeing a lot of newly empty commercial real estate in my area. The increase is startling.
I’m seeing a lot of it here in Tucson as well. A lot of recently built or recently renovated property is just sitting there. Not to mention the property that’s been around for a while. Lots of commercial property vacancies out there.
Well the 2006 CitiGroup “Plutonomy Report” said we didn’t retail consumers, so it’s all good!
Has this story been deliberately kept out of the MSM spotlight, or is it just that I haven’t paid close enough attention?
Why would you suspect they would deliberately keep this out the news? I’m sure it only makes up half of those Level 3 “Assests.”
More proof that there is a shortage of qualified workers in the US:
Lawsuit accuses Apple, others of fixing worker pay
Posted by Josh Lowensohn | 05/04/2011 | 07:12 PM
http://m.cnet.com/Article.rbml?nid=20059875&cid=null&bcid=&bid=-38
BULLoney
Maybe in a tiny tiny sector they are correct, but from what i see there is a shortage of qualified employers that hire smart people.
Most hire the dumbest they can find so that leaves me out in the cold.
Because dumb people are cheap.
And easier to fire when an even cheaper alternative comes along.
and nobody steals your workers after you’ve trained them.
A new California lawsuit accuses Apple, Google, Adobe Systems, Intel, and other tech companies of violating antitrust laws by allegedly conspiring to fix employee pay, as well as working out “no solicitation” deals with one another.
So much for the meritocratic free market.
I am so glad to have escaped from Corporate America.
Flippers in the area:
Check out the options w/the balloon payments at the end:
MORTGAGE:
Down payment - $8,000
Monthly payment - $863
25 year amortization
7 year balloon
LEASE TO OWN:
Down payment - $4,500
Monthly payments - $900, plus taxes
25 year amortization
7 year balloon
http://www.limestoneridgeproperties.com/view_property.php?propertyId=322
I figured an outfit like this was around when I saw cheap stuff in poor shape disappearing. Looks like they’ve got a decent amount of land in their possession too.
Various commodities & PM in full retreat, especially oil, silver, cotton and cocoa. I think the margin requirements were raised. Some leveraged speculators must be getting crushed.
Any other news out there why this is happening?
unemployment is up why would oil and other commodities climb if the economy is slowing down ?
this could be temporary or if we go into another recession a replay of the commodity bust of 2008
unemployment is up why would oil and other commodities climb if the economy is slowing down ?
because the unit of measure for them is declining( $US )
Don’t look now, but the weekly claims for unemployment figure is solidly back at recessionary levels and climbing. Bone, meet hatchet…
Economic Report
May 5, 2011, 10:41 a.m. EDT
Applications for U.S. jobless benefits surge
Claims climb to 474,000, the highest level since August
…
This is what I see happening (IOW, more of the same):
-Dip$hits in DC panic, continue to run the QE playbook, and funnel newly printed cash to the Banksters.
-Banksters invest money overseas for “higher returns” or continue to flip commodities.
-Commodity prices increases are passed on to Main Street.
-Main Street continues to go down the crap tube, as nobody is getting any raises to compensate for higher commodity prices. The herd-culling on Main Street continues.
-Lather, rinse repeat.
Peter Brimelow
May 5, 2011, 5:48 a.m. EDT
Market-manipulation mutterings intensify
Gold bug Russell adds voice to idea of Wall Street-Washington plot
By Peter Brimelow, MarketWatch
NEW YORK (MarketWatch) — Manipulation mutterings are spreading, and that’s ominous.
Recently, I noted that longtime gold bug Richard Russell of Dow Theory Letters finally converted to the thesis that gold’s price is subject to manipulation by a Wall Street-Washington alliance. See April 25 column on Russell and the gold-manipulation thesis.
Ways to invest around IPOs
Russell seems to be brooding about this insight. In reply to a correspondent who asked about the possibility of an FDR-type confiscation of gold he said the following:
“I’ve thought about this at length, and I’ve arrived at what I believe to be the correct answer. The answer is — No, the government will definitely not call in the gold. The simple reason is that a tremendous amount of gold is held in very powerful hands. [The] SPDR Gold Trust ETF GLD -2.11% and gold bullion [are] held by pension funds, university endowment funds, large powerful hedge funds, corporate reserves and state treasuries.”
…
Hello HBB’ers,
I am long-time reader (6 years?) and sometimes poster here. Wanna-be home owner.
Feel like it’s too early to even think about buying - oh San Francisco when will you capitulate???? - but I have found the perfect house for our family…
…and now I want some advice.
My reasons for wanting to own are pretty straight-forward:
- Have lived in San Francisco for 21 years, no plans to leave. It is my home: not going back to Manhattan, won’t live too far from the ocean cuz I surf, can’t stand suburbia/strip malls, both my spouse and I work in the city as teachers and have long-term job stability, or at least as secure as any job is these days, and we like our kid’s schools.
-Dogs! Yes, we have a pile.
-Been renting the same SFH for 12 years. Rent is 2400 a month. Cheap for our neighborhood, but still, paying almost 30K a year in rent. Not rent controlled, either.
The house is vacant, has been for a year. Neighbors (who are good friends of mine) say it’s in foreclosure, and there is a for sale sign, but no one has returned my calls. “City Properties” doesn’t even have a web page. Does not show up on redfin or zillow as for sale.
Deets:
60 Gates Street 94110
2 br/1 bth
1188 sq. ft.
Sold in 2004 for 601K
$6700 year in taxes
Fixer-upper for sure
Can’t find any info. about the status of this house.
I could see growing old in this house. This is my ‘hood - we’re not going anywhere, but if and when our landlord dies or gives the house we live in to her daughter, we would be screwed and maybe even forced to leave the city.
Should I pursue this? If so, how? We have about 40K saved, could rustle up some more possibly.
Or keep waiting and hoping that my city by the bay isn’t really “different” and that housing will one day become affordable for the likes of us over-paid urban public school teachers????????
urban public school teachers????????
CA is strapped for cash your employer is broke be careful
I know what private indusry employers do in cases like this……
sfrenter
Can you dig up info at the County Recorder’s Office? I usually go in person in my area of So Ca. Call the CRO and see if they have computer monitor to search their data base available for free to the public, at their office.
Also, a Title Co might be able to give you a report on it. I called and was given a freebie, with the promise of using them as the Title Co when I finally bought.
I lived on Crescent a couple of year ago. It wasn’t a great part of Bernal Heights, but your location looks nice, up on the hill away from Mission St. Bernal was a little far away from the action of SF for me at the time, so I moved to Hayes Valley, but Bernal would be more my speed now. Good luck!
Heading over to Noe Valley tonight. Just like ol’ times!
Bernal is the new Noe. I’ve lived here 20 years, and this neighborhood sure has changed. Crescent is still a little sketchy, though.
but Bernal would be more my speed now.
Move out of SF (and maybe Cali), there are so many better places. Better, cheaper, more sane. 40K saved after spending 300K+ on rent? I’d be looking for the cyanide. GTFO, you’re #losing if you stay in that madness.
Home is home. And we have 2 kids - the homophobia anywhere else is intolerable and I wouldn’t put my kids through that. We are a same-sex couple and I am happy here in our gay ghetto.
Insanity would be living in a place where your kids are treated badly because their parents are gay. All we have to do is go 30 miles away from the city and the bigotry is right there.
Move out of SF (and maybe Cali), there are so many better places. Better, cheaper, more sane. 40K saved after spending 300K+ on rent? I’d be looking for the cyanide. GTFO, you’re #losing if you stay in that madness.
I have found it interesting, and a little perplexing, how rootless so many people are. Picking up and moving somewhere totally new may be an option for many people, but I also see it as part of a larger breakdown in community and connectedness.
This is why I could never live in suburbia, with neighbors that drive home to their bedroom community and straight into their automated garage doors without any contact with public space.
I know every neighbor on my block (we close down the street and have a block party every year) and when I go and walk my dog this evening I will see at least a dozen people I know at the park.
My friends (people I’ve known 10-20 years) may stop by for dinner, often without calling first, and that’s just fine by me.
I have yet to find a city (here in the US, at least) that is as beautiful as SF. Maybe I am burying my head in the sand, but I will go to great lengths to avoid the strip mall-ification of the world. The ugliness of it is soul sapping.
Move out of SF (and maybe Cali), there are so many better places. Better, cheaper, more sane.
This is why I could never live in suburbia, with neighbors that drive home to their bedroom community and straight into their automated garage doors without any contact with public space.
Ummm, sfrenter, were we separated at birth? Because you just nailed what I think is wrong with suburbia.
If the price is reasonable, it will probably go to a cash buyer.
Okay, I was confused the other day about the effect of pushing up against the debt limit upon the TSP. Full Story here. https://www.tsp.gov/PDF/formspubs/CRS-Memorandum-3-20-2002.pdf
“To help deal with a worsening budget picture, the Pinellas County School District announced today it will not renew the contracts of 1,100 first- and second-year teachers.”
http://www.tampabay.com/blogs/gradebook/content/pinellas-wont-renew-contracts-first-and-second-year-teachers
Proposals would cut benefits for California employees 25% to 40%
In an analysis of two concepts, the nonprofit California Foundation for Fiscal Responsibility warns that the state’s five biggest pension funds are in precarious financial conditions. ~ L.A.Times
Reporting from Sacramento—
Pension benefits for hundreds of thousands of state workers would be reduced 25% to 40% under two proposals that have become the focal points for what could become a costly and bruising ballot fight over retirement funding.
In a new financial analysis estimating the cutbacks, the nonprofit California Foundation for Fiscal Responsibility warned that rising costs of public employee pensions and retiree healthcare could overwhelm the ability of taxpayers to fund many basic health, welfare and public safety services.
“Public employees are getting far more benefits than those in the private sector,” said Marcia Fritz, the foundation’s president, adding that voters are “fed up.”
“The upshot,” she said, “is going to be a huge fight” — an initiative contest that will be followed closely nationwide.
According to the study, to be released Thursday, California’s five biggest pension funds are in precarious financial conditions. Last year, they had only enough money to cover 61% to 74% of their obligations to current employees.
Without a significant scaling back, “public employer obligations for retirement benefits will rise sharply over the next decade, further squeezing government budgets that are already facing enormous pressures,” the study said.
They need to gut the health insurance companies which is where most of those costs are coming from.
+100
They need to gut the health insurance companies which is where most of those costs are coming from.
That, and I haven’t seen too many doctors around here downsizing from M-Bs and Porsches into Buicks and Hyundais.
Go into any doctors/dentists office. Half of the staff is claims processors. The game plan is to run as many patients thru, as fast as possible.
I’ll bet if you told the young doc/nurses that if they signed up to work for a “National Health Care Company” that had a fixed wage scale, but:
-Forgave student loans after “X” years of service.
-Had no malpractice premiums to pay.
-Did away with screwing around with drug salesmen and insurance paperwork.
-Made transferring to different cities/states easy, due to the “National” nature of the company.
….you would find a bunch of people who would rather work as a “socialist”, than deal with all of the “benefits” of a “free-market”.
Your local electric company is a public utility. Don’t know why health care can’t be treated the same way. Of course this would require people to give something up, like the “right” to wait 6 weeks for an appointment with a “free-market” specialist, vs 8 weeks for someone working for the “utility”.
I think Aspen Dental kinda does what you listed…
+1
We are canceling our independent Kaiser coverage, mailing our letter in the morning. Every freakin year they jack it up 12%. Now it’s just unaffordable for us.
“Bureaucracy defends the status quo long past the time when the quo has lost its status”.
- Laurence J. Peter
Regulators Must Avoid ‘Burdensome’ Rules: Bernanke
Bloomberg - May 5, 2011
Federal Reserve Chairman Ben S. Bernanke said the government must avoid imposing burdensome rules on financial companies as it carries out the biggest regulatory overhaul in seven decades.
“No one’s interests are served by the imposition of ineffective or burdensome rules that lead to excessive increases in costs or unnecessary restrictions in the supply of credit,” Bernanke said today in a speech in Chicago. “Regulators must aim to avoid stifling reasonable risk-taking and innovation in financial markets, as these factors play an important role in fostering broader productivity gains, economic growth, and job creation.”
Bernanke and Fed officials are trying to balance the need to reduce the risk of repeating the 2007-2008 financial crisis with the aim of reviving the U.S. economy after the worst recession since the Great Depression. The central bank, under last year’s Dodd-Frank Act, was given the job of overseeing the biggest financial companies.
“While a great deal has been accomplished since the act was passed less than a year ago, much work remains to better understand sources of systemic risk, to develop improved monitoring tools, and to evaluate and implement policy instruments to reduce macroprudential risks,” Bernanke said to the Chicago Fed’s annual banking conference.
“Federal Reserve Chairman Ben S. Bernanke said the government must avoid imposing burdensome rules on financial companies as it carries out the biggest regulatory overhaul in seven decades.”
Would a requirement to follow a rule of law fall under the scope of regulatory overload?
Rules don’t matter when they’re not enforced. If the regulatory agencies would have been properly funded and headed by people who believed in regulation during the Bush years, then we wouldn’t be having this discussion today.
..and who have now stacked the deck on the Supreme Court to give corporations more rights than people.
- Cool, at this rate we will hit $20 trillion on or before 2014. I see no problem with this at all. Print baby, print, it’s been working so well.
(Reuters) - The Treasury has told lawmakers a roughly $2 trillion rise in the legal limit on federal debt would be needed to ensure the government can keep borrowing through the 2012 presidential election, sources with knowledge of the discussions said.
Obama administration officials have repeatedly said that it is up to Congress to decide by how much the $14.3 trillion debt limit should be raised.
But when lawmakers asked how much of an increase would be needed to meet the government’s obligations into early 2013, Treasury officials floated the $2 trillion working figure, Senate and administration sources told Reuters.
Former Treasury officials have said it is routine for Congress to ask the Treasury Department for guidance. Republican leaders have asked the White House to provide the size of any proposed increase before the two sides sit down on Thursday to discuss the debt limit face-to-face.
“We have not specified an amount or a time frame. We think that should be left up to Congress,” Mary Miller, Treasury’s assistant secretary for financial markets, told reporters on Wednesday.
She also said it would be better to raise the debt ceiling enough so that the government does not bump up against it so frequently.
“Obviously, a longer period of time between these activities would be beneficial in terms of the work that goes into preparing for a debt limit increase. But again, you know that’s not the Treasury’s call,” she said.
“All the perplexities, confusion and distress in America arise, not from defects in their Constitution or Confederation, not from want of honor or virtue, so much as from the downright ignorance of the nature of coin, credit and circulation”.
-John Adams (1735-1826), American President
Freddie Mac loses $929 million
WASHINGTON (Reuters) – Mortgage finance giant Freddie Mac (FMCC.OB) on Wednesday said it lost just short of a billion dollars last quarter, though it did not ask taxpayers for more aid as the loss stemmed from interest payments to the government.
The second-largest U.S. residential mortgage funds provider reported net loss attributable to common shareholders of $929 million in the first quarter, including a $1.6 billion payment to the government. Without that interest payment, Freddie Mac earned about $676 million in the first three months of the year.
That’s the first three month period since the second quarter of 2009 that the firm reported positive net income, excluding the interest payment, and stems from higher quality loans made in recent years.
The first-quarter loss, including the interest payment, represents about $0.29 per share.
Freddie Mac and its sister firm Fannie Mae (FNMA.OB) have taken more than $150 billion in taxpayer aid since they were seized by the government in late 2008.
Interest repayments to Treasury from the two firms have reduced their net taxpayer assistance to slightly more than $134 billion.
Freddie Mac said those interest payments would increasingly drive any need for future taxpayer assistance.
“Freddie Mac loses $929 million”
Great that they reined in their quarterly losses to under $1b!
What, exactly, are they doing to generate such large losses in perpetuity?
And why aren’t the shareholders being billed $.29 per share they own?
This is amazing. On DC news radio, the story reported was that Freddie Mac made a profit recently, and would not need taxpayer money:
Freddie Mac reports 1st quarterly gain in 2 years
Wednesday - 5/4/2011, 6:11pm ET
By DEREK KRAVITZ
AP Real Estate Writer
WASHINGTON (AP) - Freddie Mac earned $676 million in the January-March quarter, the first time the bailed-out mortgage giant has reported a quarterly gain in nearly two years.
The government-controlled company requested no additional federal aid Wednesday after receiving $13 billion over the past four quarters.
http://www.wtop.com/?nid=628&sid=2370535
What is the disinformation?
Youngest daughter came by last night……she went out looking for a new(er) car last night.
Saw one she wanted to look at, at the local Multi-brand dealer’s used car Department.
She asked for the price, was told they needed to go inside to check it. At which time they started the “Are you buying today/How much do you want to spend a month” speech. She spoke louder: “What is the price?”
Sales puke changed tactics, started asking how much she wanted on trade. Daughter replies louder “WHAT IS THE FRIGGIN’ PRICE?”
They finally gave them their asking price. At which time, she told them they must be smoking some really good crack, to think that someone was going to pay that for a run-of-the-mill Ford Mustang. Thanked them for wasting her time, on her way out the door.
Papa is so proud……:)
I’m still seeing sky high asking prices for used cars out here. 5 year old domestic brands (with say 60K miles) for as much as 60% (or more) of their MSRP when new. Case in point: We have a 2006 Buick Lacrosse CX (base model). We paid 20K for it in 2006 (MSRP was 24K), most local dealers are asking 13-14K for them now. I remember when you could pick up a used car for 60% of MSRP when it was only two years old.
I think that this is happening in part because new car prices have gone up substantially. A 2011 bare bones Lacrosse will have an MSRP around 29K (there is a 27K 4 cylinder model). In 2006 29K got you a fully load Lacrosse, with the more powerful DOHC V6 engine. Rebates are much smaller than they once were as well.
I will NEVER, EVER!! deal with a big lot dealer again. (except “maybe” CarMax)
Man the biglot guys were awful 7 years ago. I can only imagine how viperous they’d be now.
Very cool X-GS. Man would I have loved to be a fly on the wall for that one.
Shake your daughter’s hand for me, okay?
@SFrenter,
The house is in preforclosure. Go to foreclosure.com and sign up for a free weeks subscription. you’ll get all the details on that site.
Call the lender directly. Offer 350K. Good luck
sfrenter
Be careful on any real estate related “freebie”. Do not give out your cc#. Many require it. Caveat Emptor!
@SFRenter,
Of course you need to get the house inspected and all. The web site will walk you through the “how to” process of buying foreclosures.
Haven’t had one of these announcements in a while. I really thought it was going to be teachers and government workers first. I’m not celebrating anyone’s demise. But (overt) fear went away when these announcements stopped. I knew they (major layoff numbers) would be back. Just didn’t know when. A few more stock market days like today, a few more lay-off announcements show people this “recession” isn’t over spending may be pulled back again like we saw in 2008/9.
http://www.9wsyr.com/news/local/story/Lockheed-Martin-begins-nationwide-layoffs-89-at/gOBy1mfbWEijMoFAcoGWNg.cspx
Salina (WSYR-TV) – Lockheed Martin conducted its most recent wave of layoffs on Thursday. A total of 227 are losing their jobs nationwide, 89 positions were lost at the plant’s Salina facility. (outside Syracuse)
The layoffs were announced in March. The majority were drawn from the company’s engineering pool.
Economists believe the industry could be in for a tough year.
“Manufacturing and the government are the weakest at this point,” said Department of Labor Associate Economist Karen Knapik-Scalzo.
http://market-ticker.org/akcs-www?post=185520
Hope ‘n Change ‘n Orwell. Is this what you had in mind, Yes We Can dupes?
I have to assume it’s BS or a smokescreen for something else. It makes no sense at all to do that when you could just increase the tax on fuel and accomplish almost the same thing. The only difference is the percentage paid by gas guzzlers versus fuel sippers. Surely they wouldn’t go to that much trouble to protect SUV drivers and hose Prius drivers?
lol- You’ve gone off the deep end, Sammy.
R’uh r’oh…..
(Reuters) - The killing of Osama bin Laden when he was unarmed has raised concerns the United States may have gone too far in acting as policeman, judge and executioner of the world’s most wanted man.
But for several Muslim leaders, the more unsettling issue is whether the al Qaeda leader’s burial at sea was contrary to Islamic practice.
“It’s not justice. It’s a perversion of the term. Justice means taking someone to court, finding them guilty upon evidence and sentencing them,” Robertson told Australian Broadcasting Corp television from London.
“This man has been subject to summary execution, and what is now appearing after a good deal of disinformation from the White House is it may well have been a cold-blooded assassination.”
Robertson said bin Laden should have stood trial, just as World War Two Nazis were tried at Nuremburg or former Yugoslav President Slobodan Milosevic was put on trial at the war crimes tribunal in The Hague after his arrest in 2001.
“The last thing he wanted was to be put on trial, to be convicted and to end his life in a prison farm in upstate New York. What he wanted was exactly what he got - to be shot in mid-jihad and get a fast track to paradise and the Americans have given him that.”
“What he wanted was exactly what he got”
He sure was hiding, for someone that was wanting it.
He could have died in combat in Afghanistan if he wanted to, rather than in his bedroom in a suburban Paki-mcmansion, in his jammy-jams.
(www.latimes.com/business/la-fi-pension-overhaul-20110505,0,7054972.story)
“Proposals would cut benefits for California employees 25% to 40%
In an analysis of two concepts, the nonprofit California Foundation for Fiscal Responsibility warns that the state’s five biggest pension funds are in precarious financial conditions…According to the study, to be released Thursday, California’s five biggest pension funds are in precarious financial conditions. Last year, they had only enough money to cover 61% to 74% of their obligations to current employees.”
Now let’s see who has the balls to get the job done!!
Lobbying $$$$ spent up over last year, way up over 2000 spending.
ALBANY, N.Y. (AP) — Hard times apparently didn’t hurt one segment of the economy in Albany, where money spent on lobbying blasted past the $200 million mark for the first time in 2010.
The state Commission on Public Integrity’s annual report released Thursday found that special interests from big business to teachers and public worker unions spent more than $213 million to influence state spending and legislation. That’s up from less than $198 million the year before.
The 2010 total is up from $66 million in 2000, according to the commission’s report released Thursday.
http://www.syracuse.com/news/index.ssf/2011/05/more_than_200_million_spent_on.html