Bits Bucket for May 30, 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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O.k. I need some advice here. I`m thinking of buying in Chandler and/or Gilbert given the inventory had dropped substantially.
Question: Is now a good time to buy or should I wait?
So are you saying you don’t believe the banks are sitting on shadow inventory in that area? Are you saying you believe QEIII is going to continue to kick the can down the road and you can’t stand waiting any longer? Are you saying you believe the economy really did hit a bottom and you don’t want to miss out? Are you saying there is job creation or investment in a specific industry going on in that area that is spiking home purchases?
My point is is this decision about reasoning or emotion?
Buying decision is usually emotional then we rationalize it afterwards.
“Buying decision us usually emotional then we rationalize it afterwards.”
As are most decisions. And a person who understands this about himself is a very wise person.
A salesman who understands this about others is on the road to becoming a good salesman (if he already isn’t there).
There is a saying: “Human beings are not thinking entities that feel, human beings are feeling entities that think.”
“And a person who understands this about himself is a very wise person.”
I understand this about myself and keep my emotions accordingly in check whenever deciding whether to buy something.
Usually the decision is to not make the purchase.
PB Man, the rationalizing animal.
I don’t claim to be all that rational. I am pretty sure that I am too pessimistic at times for my own good. But the trait certainly saved us hundreds of thousands of dollars in real estate losses that we would have incurred if we had just gone with the flow and bought a home when we landed in San Diego six years ago.
I was unclear. I didn’t mean that you were particularly rational. I meant that man, as a species tends to rationalize, rather than be rational.
“…man, as a species tends to rationalize…”
You bring to mind one of the all-time favorite characters from the past, my high-school tennis coach. He was quite the home-spun philosopher; for instance, one of his favorite pep talks went something like this:
‘Boys, you can rationalize all you want. I could have, should have, would have won if the wind had been slower, my opponent hadn’t cheated, my backhand hadn’t been off, or any number of other reasons. If you think you are better than your opponent, then take two balls onto the tennis court and beat him. Otherwise, I don’t want to hear about it.’
I think people who buy now are essentially catching a falling knife.
I don’t see wages rising but I see food prices rising. I’ll leave the obvious conclusion as an extraordinarily simple exercise to the reader.
That’s still the D-word, kids!
“I don’t see wages rising but I see food prices rising. I’ll leave the obvious conclusion as an extraordinarily simple exercise to the reader.”
Let me try.
Suppose I have, say, $40,000 in annual disposable income which I can spend on housing and other stuff (including volatile food and energy expenditures). If I spend 30% of my disposable income on housing, then I can afford 30%*$40,000/12 = $1000/mo on rent or a mortgage, and 70%*$40,000/12 = $2,333/mo on other stuff (car payments, fuel, food, education, entertainment, vacations, clothing, health care, furniture, etc).
Now suppose inflation rears its ugly head, and despite my best efforts to contain spending on non-housing consumption, I have to spend an additional 10% on other stuff besides housing (e.g. due to gasoline increasing to well north of $4/gal, and cheap wine prices rising from $5 to $6 a bottle). This leaves me with only (100% - 1.1*70%) = 23% of my disposable income available to pay rent or a mortgage. Without higher take home pay, my monthly housing budget is now constrained to
23%*$40,000/12 = $767/mo.
If I am on the hook for a $1000/mo mortgage payment, I am pretty much financially screwed.
Does that drive home the point?
Shouldn’t that be the S-word?
Not if house prices are falling.
The emotional feeling is the same, admittedly, but technically, it’s still the D-word.
They are two end-points of a larger cycle but the characteristics are quite different. In the S-word, you’d take out a loan, in the D-word, you’d sock money away like there was no tomorrow.
If there was no tomorrow, why would you need to sock money away?
“If there was no tomorrow…”
I believe the point was ‘no economic activity tomorrow,’ in which case cold hard cash comes right in handy.
although prices may have come down quite a bit and inventory may “appear” to be decreased, there are two ways to look at it.
If you buy now you may see further losses. Growth in those areas will be stagnant at best for a long time. If you don’t buy now, you most likely will see even better opportunities down the road. Please keep in mind, it is humanb nature to look at pricing today vs. 2005 and say “prices are down 50%, property must be cheap”
however in AZ, I would say you could safely use 1999 pricing as a benchmark. Looks like these guys went even further back…
May 27 (Bloomberg) — A 10,200-acre (4,100-hectare) desert site in Arizona sold for $32.5 million this week, five years after a group with investors including the California Public Employees’ Retirement System paid $400 million for the land.
Arcus Property Solutions LLC, a private-equity fund with about $100 million under management, paid cash for the property in Goodyear, about 60 miles (97 kilometers) southwest of Phoenix, said Kent Kleinman, a spokesman for the Gilbert, Arizona-based company. The site, now called Amaranth Land LLC, had been planned for a 42,000-home community by the Calpers- financed group when it was purchased in 2006.
The deal shows how property investors are taking advantage of a plunge in values after the real estate bubble burst in Arizona. A group of lenders, led by Goldman Sachs Group Inc., seized control of the Amaranth site in 2009 after the bust halted development, said Jeff Garrett, owner of Garrett Development Corp., the land’s manager after the foreclosure.
“Five, six years ago, people were spending $200 million or $300 million or $400 million,” Garrett said in a telephone interview. “This just sold for about eight cents on the dollar.”
The 2006 buyers were a joint venture of MW Housing Partners III LP, a real estate fund with money from Calpers and Weyerhaeuser Co.; and Scottsdale, Arizona-based Montage Land LLC, according to Arizona Corporation Commission records. The deal was funded by a $250.1 million loan and $150 million in cash, according to Terry McDonnell, publisher of Business Real Estate Weekly of Arizona in Scottsdale.
maybe 8 cents is about right????????
Q. In a battle between Goldman Sachs and CAL-PERS, who loses?
A. Everyone else.
I wrote a letter to the editor of our local rag (San Diego Union) several years ago commenting on Cal-PERS RE investment losses at the time and how it was just the tip of the iceberg (thanks Ben and HBB). To my amazement, they actually published it.
Anyhow, I’m sure the good folks in CA will somehow be screwed to make Cal-PERS whole.
8 cents on the dollar is based on 2006 peak prices. It is fun to compare to peak. But compared to 2001 prices, which may still be too high, perhaps 50 cents on the dollar.
I’ve driven through there…its nothing but miles and miles of nothing. I just can’t imagine the need for 42,000 houses.
I wonder what plans the new owners have for the land.
‘I wonder what plans the new owners have for the land.’
Poppies
LOL
60 miles out?
Maybe some of the anger being directed at the “public union employees” and their “crazy pensions” should be directed at the guy at CALPERS who got an eight cent return on a one dollar investment.
It isn’t union employees who are going to take us down. It’s going to be caused by the “too big to fail” executive class in this country, who make millions a year, no matter what kind of stupid decisions they make.
“Maybe some of the anger being directed at the “public union employees” and their “crazy pensions” should be directed at the guy at CALPERS who got an eight cent return on a one dollar investment.”
I sure some “neo-con” sociopath consultant handheld CalPERS on this wonderful deal. No remorse, no vanity.
High paying jobs still leaving Phoenix. New jobs coming in, but are low wage. If you are already living in Phoenix and renting, keep tabs on the markets. Educate yourself. Look at sales histories. Those are objective because they are facts. Don’t look at asking prices. I would not buy anything with rentals in the neighborhood if it is my principle residence. I think Phoenix prices will reach the 90s bottom or the late 80s prices.
It’s the wages man!
That seems to be the case every where, nothing but service jobs.
What are you paying in rent, may I ask? How stable is your job?
Your 2nd question is the important one assuming he is not retired and if he is that would then would prompt the question how stable is your retirement income ??
Buy NOW!!!!! As you state, inventory is disappearing fast because everyone is buying.
Secondly, get a mortgage with the highest interest rate possible so you can really leverage the mortgage interest tax deduction.
Report back to us and let us know how you. You’re gonna make a killing.
Water? Jobs? Crazy heat, I’d say wait, and never buy there. Living there means you are reliant on AC.
The folks who say “wait” definitely have market inertia on their side, but what part of the market are you looking into? Perhaps lower-end homes in your area are bottoming out, while mid to higher-end ones have quite a bit to fall. I’m generalizing because I don’t know your area, but that seems to be a reported pattern.
The high and low ends are not decoupled; rather, when the high-end falls, the low-end will be crushed like the basement of a home in Joplin, Missouri, after a tornado turned the upper part of the home into a pile of rubble.
“when the high-end falls, the low-end will be crushed like the basement of a home in Joplin, Missouri, after a tornado turned the upper part of the home into a pile of rubble.”
Nice description! I’m talking about reports that investors tend to snap up the low-end homes, as they’re ‘cheap’, which might be stabilizing the low-end prices. But yeah, that could just be a temporary thing.
Costco CFO: Inflation is Clearly Back
Seattle Times
As everyone from Starbucks to McDonald’s raises prices to keep up with higher food costs, Costco Wholesale said it is seeing inflationary pressures as well.
“Inflation is clearly back,” Chief Financial Officer Richard Galanti told analysts during a conference call Wednesday after Costco reported a 6 percent rise in its third-quarter profit to $324 million.
Sales rose 16 percent to $20.6 billion, including membership fees of $435 million.
The Issaquah-based company took a $49 million charge to revalue its inventory, which is worth about $4 billion in the United States alone. About $11 million of that charge came from gasoline-price inflation, Galanti said.
“My guess is it’s impacting us a little sooner, because we turn our inventory faster,” he said.
He listed examples of items that are up, including dog food (3.5 percent), detergents (10 percent), water (10 percent), plastic plates and cups (8 to 9 percent) and trash bags (4 percent).
“It’s going to continue; at least it’s continuing so far this fiscal quarter,” Galanti said. “When will it subside? Hopefully soon.”
Costco will raise its prices on some of the items beginning in June, he said.
When inflation picked up in 2008, Costco was among the first to take a charge for inventory, which is necessary because of the accounting system it uses. Inflation quickly subsided in late 2008 because of the economy’s dire condition.
Now it is back, and on Wednesday Starbucks raised the price of packaged coffee sold in its cafes by an average 17 percent. It had already raised prices 12 percent on packaged coffee sold by grocery stores.
That followed J.M. Smucker’s announcement Tuesday that it will raise Folgers coffee prices by 11 percent.
McDonald’s raised its U.S. menu prices by 1 percent in March and said more increases are on the way.
Although Costco’s sales were up, its electronics department is lagging.
People bought fewer computers there in recent months, partly because Costco has stopped carrying Apple products and partly because some customers are waiting for new processors to appear with new computer chips from Intel and AMD, Galanti said.
TV sales are flat, and the average price of the TVs people are buying is down, he said.
Costco’s profit of 73 cents a share missed analysts’ expectations by 4 cents. Its stock fell $1.03 Wednesday to $80.32 a share. It has traded as high as $83.95 a share during the last year.
No Banker Left Behind
It’s GOOD to be the Banksta!
Lyrics to My Boyfriend’s Back :
He went to Costco and you came around,
And bother me every night
When I couldn`t pay for you you,
You said things that weren’t very nice
Inflations back and you’re gonna be in trouble
Hey la Hey la Inflations back
If you see him come, better cut out on the double
Hey la Hey la Inflations back
Have you seen the prices on McDonald’s menu
Hey la Hey la Inflations back
I can only buy one but I used to buy two
Hey la Hey la Inflations back
Yeah he knows what you’ve been tryin
With the burgers that your fryin`
He’s been gone for such a long time
Hey la Hey la Inflations back
Now he’s back and things will be fine
Hey la Hey la Inflations back
You’re gonna be sorry when you buy you`re Smucker’s
Would you look at this why those mother f#%*ers
Hey la Hey la Inflations back
Hey he knows I wasn’t cheatin’
Now my wallet took a beaten
What made you think I’d believe all your lies
I can buy the burger but I can`t buy the fries
Wait and see
Inflations back according to my calculation
Hey la Hey la Inflations back
I gotta tell the kids we gotta cancel our vacation
Yeah Inflations back back
Yeah I know you see it comin` so you better start a runnin`
So look out now Inflations back
Yeah Inflations back…
“TV sales are flat.”
Um, duh. Who buys CRT’s anymore?
I heard it was hard core gamers…seems there is no lag time on a CRT and even a few milliseconds on a LCD is too long.
Which is why I refuse to play online. Why bother with skill when someone else can just buy a shorter ping time? Also, I saw a beau being PK’s and said, nope, no online gaming for me. The computer is hard enough.
Take a look at what prices that have risen and what prices that have not.
Prices of necessities have risen, prices of non-necessities have not. Choices are being made by consumers as to what to buy and what not to buy. The choices are being driven by a tightening of money; If there was an abundant supply of money then choices wouldnt have to be made at all - just buy everything in sight.
Buing everything in sight used to be what happened not too many years ago when consumers sucked billions of dollars of equity out of their houses and then blew this money at Walmart. Now they don’t have the money to blow, now they have to make choices.
The COSTCO CEO is in error. Ben Bernanke specifically assured us that his deranged money-printing would not be inflationary. Just as it wasn’t in the Weimar Republic or Zimbabwe.
Oh, wait….
Those darn commodities traders protecting their capital from the men behind the curtain. Anyone got moneys in a Greek bank?
If you’re an American taxpayer, yes, you are involuntarily “contributing” to insolvent Greek banks via your contributions to the IMF, which gets somewhere between 17-30% of its funding from the US. The Fed has also arranged numerous backdoor bailouts to Eurozone banks, and will doubtless continue to do so.
“It’s going to continue; at least it’s continuing so far this fiscal quarter,” Galanti said. “When will it subside? Hopefully soon.”
QE3 will make sure that inflation becomes the new normal. I hope the under $500/week crowd likes generic storebrand mac-n-cheese.
Are you people kiddin’ me?
I make “fancy” mac-n-cheese. Local pasta, organic milk, real parmigiano-reggiano, gruère, heck, even truffle oil sometime.
It costs less per serving than one of these craptacular boxes, and yes, I can show you the spreadsheet. It does require that you know how to actually cook though. Elbow grease does matter.
Now, admittedly I’m a “serious” cook but a little knowledge goes an effin’ long way, my friend!
I’d be interested in seeing how you arrived at this conclusion. I know the price of high-quality cheese and pasta, and I don’t think you can beat the buck-a-box mac-and-cheese.
I agree, real cheese is EXPENSIVE.
I have never seen anyone on food stamps buying generic anything, much less mac-n-cheese.
So why do they:
1) Shop at Walmart
2) Wait until midnight when their debit cards get recharged.
I know it’s fun and comforting to believe these people eat steak and lobster, which they drive home in their Escalades.
But reality is different, at least where I live. The walmart parking lot is full of 15 year old beaters and I see what they put in their shopping carts: WalMart brand Mac-n-cheese, WalMart hotdogs and bologna, generic PB, etc. NO FRUIT or VEGETABLES or fresh meat. You see their obese kids who are raised on these diets.
Told ya.
Another COSTCO fact: their starting wage has dropped from $13hr to $11hr.
Welcome to America, where half the workforce earns poverty wages and a visit to see a doctor costs $100.
I would say it’s 1930 again, but I believe healthcare wasn’t quite so unaffordable back then.
I would say it’s 1930 again, but I believe healthcare wasn’t quite so unaffordable back then.
Doctors did quite a bit of deal-making back then. Of the “chickens for checkups” variety — especially in rural areas. For some of them, it was the only way they could stay in business.
Doctor? Pfft. We’re to the point where it’s “go to the emergency room, then stiff them on the bill.”
Healthcare wasn’t nearly as sophisticated in 1930. Paramedics now may provide care on a level with what doctors could do then. For some things, paramedics can provide better care now than what was available at the best hospitals in 1930.
Palin kick-starts bus tour on back of motorcycle
WASHINGTON – Sarah Palin rumbled through Washington on the back of a Harley as she and her family began an East Coast tour Sunday, renewing speculation that the former Alaska governor would join the still unsettled Republican presidential contest.
When one man asked her if she was running, she smiled and answered, “Don’t know.”
Palin showed no hints she would join the field on Sunday although she again demonstrated her ability to build excitement and practice the person-to-person, retail politics that she clearly loves. In heels and black flare slacks, Palin shook hands and posed for pictures with well-wishers.
Just before she, husband Todd and daughters Bristol and Piper rolled from the Pentagon’s parking lot, she gave a thumbs-up to a military police officer who asked if he could snap a picture while taking a break from directing traffic.
On the windshield of Palin’s bike: a likeness of President George W. Bush. Next to it, the words “Miss Me?”
Sounds like they love her!
Sarah Palin not invited to Rolling Thunder
MSNBC
WASHINGTON — One day after Sarah Palin announced her bus tour, a group sponsoring a Memorial Day weekend event she plans to attend said they never invited her.
“She wasn’t invited. We heard yesterday she came out with a press release she was coming to Rolling Thunder,” Ted Shpak, national legislative director of Rolling Thunder, told “Andrea Mitchell Reports.” Shpak is one of three members of Rolling Thunder’s current leadership who says he had no idea Palin was coming until it was posted on her website.
When asked if Palin’s bus will be participating in the event, Shpak of Rolling Thunder Inc. responded, “Absolutely not.”
“She’s not invited to speak. We’re not endorsing her … (but) we can’t stop her from coming to ride, if she wants to ride,” Shpak continued.
Seeing a mental dwarf/fame whore like Sarah Palin launching her pre-Presidential campaign bid - and recognizing that the same idiots who voted for McCain and Obama could very well install her in the White House - brings to mind some apt H.L. Mencken quotes:
“Nobody ever went broke underestimating the intelligence of the American public.”
“The demagogue is one who preaches doctrines (s)he knows to be untrue to men (s)he knows to be idiots.”
“The government consists of a gang of men exactly like you and me. They have, taking one with another, no special talent for the business of government; they have only a talent for getting and holding office.”
“The men the American public admire most extravagantly are the most daring liars; the men they detest most violently are those who try to tell them the truth.”
Palin’s idiotic circus continues on. If people like Trump, Palin, Beck and the other religious nut jobs keep hogging the circus show Barry will start to look good to many voters. Imho
The other day I was channel surfing and caught the beginning of the Colbert Report (I usually don’t watch it as I find him to be irritating). He was joking about an upcoming GOP prez candidate debate. He told the audience that seats were still available … on stage.
As mediocre as Obama’s presidency has been, I don’t see the GOP fielding a credible threat. Anyone who isn’t a total idiot is avoiding seeking nomination as they don’t want the unsolvable disaster to land in their lap and get blamed for it. I think they would prefer to leave Obama in place while they hand out GWBush “Miss me?” bumper stickers and continue to bitch about the deficit they helped create.
As mediocre as Obama’s presidency has been, I don’t see the GOP fielding a credible threat.
I agree. Obama’s presidency is turning out to be about as transformative as Eisenhower’s. And Ike even had the launch of the Interstate highway system to his credit.
He will definitely appear to be the lesser of all evils.
Ronald Reagan was deemed the lesser of two evils in 1980.
On the windshield of Palin’s bike: a likeness of President George W. Bush. Next to it, the words “Miss Me?”
Sure George, I miss you. My wages were stagnant during your tenure and I was laid off twice as my jobs were offshored and you handed out H1-B visas like Halloween candy. During both your predecessor’s and successor’s admins I got solid pay raises every year.
I miss you like I miss a hole in my head.
Remembering my father, and his brave buddies.
“Remembering my father, and his brave buddies.”
When I read this, the picture of my old man in his WW2 Navy uniform and my uncles picture with his bomber crew in front of their plane instantly popped into my mind.
Well said. I think I will remember your dad, his brave buddies and all the brave men and women who have served and are serving this country.
In Flanders Fields
By: Lieutenant Colonel John McCrae, MD (1872-1918)
Canadian Army
In Flanders Fields the poppies blow
Between the crosses row on row,
That mark our place; and in the sky
The larks, still bravely singing, fly
Scarce heard amid the guns below.
We are the Dead. Short days ago
We lived, felt dawn, saw sunset glow,
Loved and were loved, and now we lie
In Flanders fields.
Take up our quarrel with the foe:
To you from failing hands we throw
The torch; be yours to hold it high.
If ye break faith with us who die
We shall not sleep, though poppies grow
In Flanders fields.
War is a Racket: Major General Smedley Butler, USMC, 1933
http://www.informationclearinghouse.info/article4377.htm
HOW TO SMASH THIS RACKET!
WELL, it’s a racket, all right.
A few profit – and the many pay. But there is a way to stop it. You can’t end it by disarmament conferences. You can’t eliminate it by peace parleys at Geneva. Well-meaning but impractical groups can’t wipe it out by resolutions. It can be smashed effectively only by taking the profit out of war.
The only way to smash this racket is to conscript capital and industry and labor before the nations manhood can be conscripted. One month before the Government can conscript the young men of the nation – it must conscript capital and industry and labor. Let the officers and the directors and the high-powered executives of our armament factories and our munitions makers and our shipbuilders and our airplane builders and the manufacturers of all the other things that provide profit in war time as well as the bankers and the speculators, be conscripted – to get $30 a month, the same wage as the lads in the trenches get.
Let the workers in these plants get the same wages – all the workers, all presidents, all executives, all directors, all managers, all bankers –
yes, and all generals and all admirals and all officers and all politicians and all government office holders – everyone in the nation be restricted to a total monthly income not to exceed that paid to the soldier in the trenches!
Let all these kings and tycoons and masters of business and all those workers in industry and all our senators and governors and majors pay half of their monthly $30 wage to their families and pay war risk insurance and buy Liberty Bonds.
Why shouldn’t they?
They aren’t running any risk of being killed or of having their bodies mangled or their minds shattered. They aren’t sleeping in muddy trenches. They aren’t hungry. The soldiers are!
Give capital and industry and labor thirty days to think it over and you will find, by that time, there will be no war. That will smash the war racket – that and nothing else.
I admit to being partial to this poem by Donal Baker.
Delinquent Elegies
for Keith Douglas (1920-1944)
John Smith (1923-1944)
My friend, John Smith, a usual man,
urging his bomber from the earth,
heard his life end in a loud bang
and took fire with his last breath.
Our engines idled through the necessary pause,
until his passion was extinguished.
Then the others of the squadron rose
into the morning, over John Smith’s ashes,
bombed, and at noon returned, most of them,
to the hut where, with one dropping eye,
the colonel drew the obvious lesson:
how not to fly.
No day could have been more ordinary
So much was burning in that bad time
that no one troubled to sing an elegy
for John Smith and his crew of nine.
That was almost forty years ago.
Now in the evening on our TV
the shining bombers climb and show
us how it was, is, and again will be,
while here, where only a desk lamp burns,
I rake old anguish to make my truth
and record at last some ordinary rhymes,
a late song for a long-dead youth.
My friend, John Smith, who, in the Second War,
blew up and burned, one among many,
a clownish hero, killed by error,
as smart as most, as brave as any.
“I think I will remember your dad, his brave buddies and all the brave men and women who have served and are serving this country.”
Good. Remember them tomorrow, too, with at least a phone call to your US Rep and Senators demanding an end to the “war” in Afghanistan. And while you’re at it, ask them why illegal immigrants and their spawn get all kinds of goodies on demand, while wounded warriors are stonewalled by the Department of Veterans Affairs and have to struggle for benefits they’re rightfully owed.
Ask them why Henry Kissinger is feted and honored by US “elites” after this little gem: “Military men are just dumb stupid animals to be used as pawns in foreign policy.
Henry Kissinger, as quoted in “The Final Days” by Bob Woodward and Carl Bernstein in chapter 14. Page 194 in the paperback version (1995).” (Who is the real animal here?)
Ask them what they’re sending members of the military to fight, die or get maimed for while the US turns into a turd world hell hole, with open arms to countries and people hostile to US citizens, and giving away jobs, resources, etc. to same.
But that’s for tomorrow. Today, make sure you imbibe plenty of beer and barbeque.
Oh, yeah, I’m way out of line.
#1
“But that’s for tomorrow. Today, make sure you imbibe plenty of beer and barbeque.”
I haven`t had a beer in over 23 years, but that`s another story.
#2
“Oh, yeah, I’m way out of line.”
I believe our military has afforded all of us the “right” to say things that are “out of line” that I don`t think Hitler, Stalin or the Muslim Brotherhood would have. They are not the politicians. So I thank them
whenever I see them, not just today.
#3
“Henry Kissinger is feted and honored by US “elites” after this little gem: “Military men are just dumb stupid animals to be used as pawns in foreign policy.”
If this is true, I have no words for the disgust and contempt I would have for this man.
“Henry Kissinger is feted and honored by US “elites” after this little gem: “Military men are just dumb stupid animals to be used as pawns in foreign policy.”
If this is true, I have no words for the disgust and contempt I would have for this man.
You’re not the only one.
I don’t recall which book I read this nugget in, but a few years ago, Henry the K was trying to gain admission to the White House. He pulled out all sorts of ID, but nothing would pass muster.
Someone pointed out to the White House security guy that the old man was Henry Kissinger. (Henry the K was out of earshot by that time.) The security guy’s response? “I know.”
Nice, Az.
I agree. And one thing that gets me is people who robotically tell one who served in these modern wars “thank you for defending our freedom.” our freedom was last at stake in the second world war. One might arguably also say during the cold war too. But police actions? I say to the soldiers “thank you for serving.” “Serving” is the correct phrase.
I did agree with the original response of 9/11. We should have committed only to Afghanistan until we snuffed OBL. We need retaliatory force to venue against criminals who kill innocent Americans. OBL is dead. Why is the US still there? Pack up, downsize military spending, cut taxes commensurately.
“thank you for defending our freedom.”
Yeah, that Patriot Act is awesome. Some freedom. Not to mention the TSA, now THERE is some freedom for ya.
And both these little gems wouldn’t be necessary if immigration, travel to and from and communication with people in hostile nations was forbidden.
We still have it fairly good here in the USA, but not much longer if things keep on going as they are.
Bill, I was with you until the “cut taxes” part.
I thought that the debt was a huge problem, you know, everybody on the tee-vee says that “the country is broke.” So if any extra little money goes in, it should go towards paying back the debt, right?
In fact, I remember when the economy was booming in the 90’s due to the new jobs created from the Internet. Clinton took advantage of all that new job revenue to not only take in more money than was going out, but also to use the surplus start paying back the debt itself. When the Republicans got into office, they agreed that paying back debt was wiser than racking up more debt, so they continued to keep the same level of revenue and paid…
oh wait.
And one thing that gets me is people who robotically tell one who served in these modern wars “thank you for defending our freedom.” our freedom was last at stake in the second world war.
I agree wholeheartedly with you on this one Bill. In fact, I was discussing this with my teenagers yesterday.
They told me that Memorial Day has no meaning for them. My reply was: Of course. Today we have a mercenary military that fights wars of imperialitic agression. And if there was a draft we wouldn’t be in these wars. But since there is an endless supply of poor underclass kids whose only other choice is to flip burgers (and they need to speak Spanish to do that these days) that it’s “someone else’s children” who are fighting, getting maimed (physically and mentally) and killed, the upper crust doesn’t have to worry about their Bratfords and Snotleighs having their Ivy League experiences interrupted by a tour of duty in the middle east.
And the Forever War continues. So much for “Bammy palling around with terrorists”.
Pack up, downsize military spending, cut taxes commensurately.
I was with you until that last part. We can’t afford to cut taxes, sorry. Tax cuts are commensurate with government spending (at least the net result is the same), and we have a “spending problem” at the moment. So any extra little monies that come in can NOT be spent. Little windfalls have to go toward paying down the principle on the debt.
“Military men are just dumb stupid animals to be used as pawns in foreign policy.”
Unfortunately this is true. I would modify the statement a bit and change the term “military men” to “YOUNG military men”, but I would leave the rest of the statement intact.
A disclaimer: I do not LIKE this statement, but I agree with the simple Truth that is embedded within it.
I would extend and modify this statement a bit to fit corporate policy in many American corporations:
“American workers are just dumb stupid animals to be used as pawns to furthur the interests of the corporation.”
Or as consumers: “American consumers are just dumb stupid animals to be manipulated so as to increase the corporation’s bottom line.”
Or as borrowers, etc.
“Military men are just dumb stupid animals to be used as pawns in foreign policy.”
This is so true. And to whitewash the deaths associated with our “foreign policy”, we have holidays like today…. drenched in sanctimonious hypocrisy and phony pandering.
Signed,
~Realtors Are Liars (Honorably discharged enlisted Army guy and son of WW2 vet)
“Military men are just dumb stupid animals to be used as pawns in foreign policy.”
My kids also tell me that whenever they criticize our military actions that their “True Purity” classmates accuse them of “hating America”. It’s nice to see that they start training them to be Fascists at such a tender age.
One difference between military personnel and civilian “workers and consumers” is that military personnel are cannon fodder and cannot quit their job.
a phone call to your US Rep and Senators demanding an end to the “war” in Afghanistan ??
I am convinced that this country is not ran by the stuffed suits in DC…Its ran by the Pentagon…
This was my first encounter with a group of Muslim Americans attending a seminar I was giving in Clark Summit PA. They travelled 2.5 hours from around Philadelphia PA to attend the seminar. They seemed nice but after a couple of hours they started having strange request. The first was if we could stop for a few minutes so that they could pray. Then they were asking me if I could confirm which way was East or West. After that they requested that I call the restaurant providing the food to make sure that the chef uses knives that had not been previously used for cutting pepperoni etc. After all this they were interested in pursuing their business venture with our company if they could get a loan without interest because paying interest would conflict with their religious beliefs. I was also somewhat surprised to learn that there are 17 Mosques around Philadelphia. Seems to we might be growing a bedrock of future conflicts right here at home. Only time will tell.
All the flaming and name calling is quite welcome today.
However I am color blind as I only see the color of money as Green. Then there is part of me who knows that we don’t want every customer.
What bothers me most is that they fully expected you to accomodate them. They can’t bring their own food or arrange for their own halal dinner? They can’t wait for breaktime to pray? Not one of them had a compass so they could find Mecca themselves?
As for the interest-free loans, well, they’re stuck.
Palmy….We should feel sorry and make right to all those who were drafted against their will…..or those who ran to canada….
Otherwise those who volunteer know the risks, and if we mistreat the volunteers eh…
I emailed Obama about 6 months ago asking him to withdraw our troops from Afghanistan. I’m only 1/8 French, so no sniping, please -
Got an automated response but nothing in person. Ten years wasted for sake of ego. And the pretty poppies still grow!
the picture of my old man in his WW2 Navy uniform ??
Mine also….
“Mine also….”
Did your Dad`s picture have that kinda weird color to it that looked like it was almost airbrushed in?
Hear hear!
My father fought in the Pacific, got wounded (blind) and spent the rest of the 1940s in and out of the hospital. Malaria, and stuff. Lived on the edge of an air strip in New Guinea, so he figured his hearing loss later in life was from that (plane engines). The WW II generation were far different. My dad was my hero and best friend.
Your father was a wounded WW2 veteran? I salute his service.
Am I correct in guessing he took advantage of the many ’socialist’ programs that FDR and Truman put in place for returning WW2 soldiers? Are you yourself not a product of FDR’s ’socialist’ programs?
What if people refused to pay for those programs at that time, because they felt the tax burden was to onerous? So they derided the beneficiaries as being parasites on the producers, and called the programs wasteful and socialist.
Aren’t you glad people weren’t like you back then?
The constitution allows for emergency police state actions when our freedom is at stake. Eisenhower gave a speech that we needed to downsize the military. JFK had enough of the 90% tax rate on the top wealthy. It was well past the emergency. That is when America must get to abfree market system. OBL is dead. Time to downsize government and allow our economy to grow.
P.S. I would not mind if the military downsizing took my job away. I want a peace dividend. While at it, get rid of section 8, welfare of all types.
“Time to downsize government and allow our economy to grow.”
After you got to grow up in a home with a gov-backed mortgage? Going to public schools? And your dad got that horrible government health care? Maybe he went to college on the GI Bill? Now it’s time to end all that- after you’ve reaped the rewards of it, but don’t care to return a portion of those rewards to the very government that helped make you who you are?
‘I got mine, skrew you.’
“While at it, get rid of section 8, welfare of all types.”
Including welfare to wounded veterans? Like your dad?
My father, still living, a “celebrated” WW2 vet of the European Theatre, awarded for bravery in the Battle of The Bulge, is a welfare case.
According to you, he sucked off the govt tit and still is to this day….
GI Bill
VA Mortgage
VA compensation for loss of hearing
VA medical benefits
Medicare Benefits
SS payments since 1981
Wow… he really is indebted to this country. This 90 year old veteran needs to be held accountable don’t you think? Seeing as he still walks 2-3 miles a day, he’s an ideal candidate for the welfare to work program don’t you think?
“Your father was a wounded WW2 veteran? I salute his service.”
So was my father-in-law. Except his side lost the war.
‘I got mine, skrew you.’
“While at it, get rid of section 8, welfare of all types.”
Including welfare to wounded veterans? Like your dad?
Gotta love the Ayn Rand crowd.
Bill, getting rid of Section 8 and welfare, will not get rid of the Section 8, welfare types that you abhor. The best case is that we end up with the slums of India or the Philippines, with all of the disease propagation that results from those living conditions. Is that really the future you want for this country?
Read my post. Did my dad earn what he did to allow you to spew such lunacy? Read the history of emergency war powers. My dad never saw me. You disgust me. You compare section 8 retards with people who protected America? You are dumbocraps. I see.
I don’t take your phony salute of my dad’s service either. My dad was never a dumbocrap. I held the folded flag at his funeral in 2000 you friggin’ vomiting creep.
“Read my post. Did my dad earn what he did to allow you to spew such lunacy?”
Well, using the Ayn Rand yardstick of values, your father was stupid, as he sacrificed himself for others.
Its a good thing that we didn’t idolize John Galt back then the way we do today. We probably would have lost the war.
“Did my dad earn what he did to allow you to spew such lunacy?”
Well, yes. That’s what we fought the war for- our freedoms, such as freedom of speech.
“You compare section 8 retards with people who protected America? ”
So, no WW2 veterans were ever in section 8 housing? No Korean or Viet Nam war vets?
“you friggin’ vomiting creep.”
Happy Memorial Day to you, too, my friend.
Here again at the end of the day, remembering my father and his brave buddies. They were not great men by any standard, yet they did great things, believing that they must do, believing in a good greater than their own lives.
Early in the day, remembering the loss of the man who was my hero and my best friend, I shed a tear. Tonight, reading the vile comments here, I shed another.
Bank-owned foreclosures account for a third of Palm Beach County’s 2011 home sales
By Kimberly Miller Palm Beach Post Staff Writer
Posted: 10:14 p.m. Sunday, May 29, 2011
It took less than a week for interested buyers to home in on the two-story, five-bedroom foreclosure on Salt Water Creek Court west of Lantana.
Advertised as needing a little TLC - a pressure wash of the roof, fresh paint on the trim - the Savannah Estates home joins the ranks of Palm Beach County’s sought-after bank-owned properties, sales of which made up 31 percent of the area’s total purchases during the first part of this year.
With a list price of $316,000, a thick blanket of St. Augustine grass and a bathroom with a bidet, this home isn’t the typical foreclosure, which buyers have picked up for an average price of just $130,393.
Still, with competition high for distressed sales, it’s likely to sell fast.
“I’ve already had two people call me just from the signs in the window,” said James Smith, who works for Home Run Real Estate in Lake Worth, which is listing the property for federal mortgage backer Freddie Mac.
According to RealtyTrac, a real estate analysis company based in Irvine, Calif., foreclosures accounted for 32 percent of all home sales in Florida during the first quarter of the year, selling for an average price of $97,450.
Nearly 28 percent of home sales nationally were of foreclosed properties during the same period.
http://www.palmbeachpost.com/money/foreclosures/bank-owned-foreclosures-account-for-a-third-of-1506571.html - -
“This (realtor) team loves distressed properties.”
http://www.heraldtribune.com/article/20110530/ARTICLE/110529504/2413/BUSINESS?Title=This-team-loves-distressed-properties
“I’ve heard predictions that by the time this is over, one third of all houses in the United States will go through some sort of loan modification, short sale, foreclosure or deed in lieu,” said Dumas, an agent with Re/Max Alliance Group in Sarasota. “Its possible that total number of deficiencies will be higher than during the Great Depression.”
Considering that some portion of houses are owned outright, that means close to half of all houses with mortgages will go through what he described.
“Its possible that total number of deficiencies will be higher than during the Great Depression.”
It would hardly be surprising, considering how much larger the population is today than in the 1930s.
Bank-owned foreclosures account for a third of Palm Beach County’s 2011 home sales
Realtors who specialize in bank-owned homes say there has been an overall reduction in foreclosure inventory, partly attributable to the moratorium lenders put on foreclosures in the fall and a continued muddle in the courts.
Debbie Smith, broker/owner of Home Run Real Estate, which specializes in bank-owned homes, said banks are doing more short sales and loan modifications that may keep people out of foreclosure.
“A lot of banks are working with homeowners to keep them in their homes, and short sales are doing really well,” she said. “It’s just now that banks are starting to get a clue they can make more money that way.”
Fewer foreclosures on the market means more competition among foreclosure-hungry buyers.
“Every property I sell has multiple offers on it,” said Realtor Steven Paulsen, who specializes in foreclosure sales for SouthEast Florida REO in Pompano Beach. “The offers are either at or above list price.”
Both Smith and Paulsen said Fannie Mae and Freddie Mac - government-sponsored entities - prefer selling to people who will live in the house, rather than investors who plan to rent.
On those properties, investors may have to wait as long as 15 days to make a bid, giving owner-occupants a chance to buy. Investors with cash, however, still may have the upper hand.
“A bank will take a discount for a sure-thing sale,” Paulsen said.
RealtyTrac CEO James Saccacio said there won’t be a real estate recovery until more foreclosures are bought up. With Florida’s current inventory, that would take 30 months, the company estimates.
“There’s no silver bullet, but once that stuff goes away, the market comes back,” Paulsen agreed. “The reality is, you just have to get through it.”
Austerity measures work their magic:
BCC cuts growth forecast for the UK economy
BBC
The British Chambers of Commerce has cut its growth forecast for the UK economy, blaming rising inflation and a squeeze on household incomes.
It now expects expansion of 1.3% this year, compared with its previous estimate of 1.4%, with growth of 2.2% predicted in 2012, down from 2.3%.
The official forecast from the Office of Budget Responsibility is for growth of 1.7% this year.
Inflation currently stands at 4.5%, more than double the 2% target.
Austerity measures work their magic:
Don’t they know they can just spend their way out of debt and in to prosperity? Now THAT will be some magic!
Isn’t the modern, western consumer sociaty predicated on spending?
Don’t get me wrong, I would love to see that model scrapped. Its just that Joe Six Pints can’t spend if he doesn’t have a job or income.
It’s built on “credit expansion” which is a source of the spending. The spending is just a by-product of that.
“It’s built on “credit expansion” ”
Correct. Hence the danger of any long-term deflation.
We inflated our way out of the last depression- although it took a world war to finally get the troglodytes to accept the necessity of government stimulus to end the deflationary death spiral. This was something Germany, Japan, and Italy had already learned, as their war preparation spurred their economies out of the depression before most other countries- especially those following austerity programs. This led many- like Henry Ford- to falsely believe that fascism was a superior system of government, when in fact, as we learned later, it was good old fashioned government deficit spending.
The difference was the pre-Reagan, we paid it back in the good times.
+1 Alpha. I’m not an economist, but Kenynesian sounds an awful lot like borrow for a rainy day, pay back when the sun shines.
“sounds an awful lot like borrow for a rainy day, pay back when the sun shines”
It’s the government being counter-cyclical.
The party that destroyed the model now claim the model is inherently flawed- because of the existence of short-sighted greedheads like themselves, who will run deficits in good times as well as bad.
Well now here’s a gem of a house. I’m trying to figure out if they’re actually serious:
http://www.realtor.com/realestateandhomes-detail/309-Market-St_Brookeville_MD_20833_M51956-95851
Setting that aside, I’m getting serious about buying, enough that I will likely choose the more expensive month-to-month option on my lease for next year. Yes I know houses have a long way to drop, but even a $350K house will be less expensive than my too-damn-high rent. In fact, this cutie-patootie home would have a lower monthly payment than a one-bedroom apartment near a metro station:
http://www.realtor.com/realestateandhomes-detail/17505-Norwood-Rd_Sandy-Spring_MD_20860_M50381-35446
The first house is kind of amazing- that it’s still standing. A 100+ year old wooden house? Wow.
The second house is nice. I like that it has a full basement. Huge yard, though- .69 acres- but it looks like you’d have a place to park your riding mower. And your airplane.
I think the 309 MARKET ST house is so expensive because that is where the Clampetts lived before they moved to Beverly Hills and there may still be some oil left on the property.
That would be one heck of a commute if you are going into the city most days. Is there a MARC station anywhere nearby?
It wouldn’t be that long of a commute because I don’t commute into the city. The Marc doesn’t go here, which is part of why this area remains largely undeveloped. Besides, where the Marc goes, McMansion hell follows.
I agree, those two houses are a little far out, but in a year or so I suspect I’ll see the same prices even further in. I’m aiming for about a 25-30 minute drive.
That nakes sense then. I was a little confused because you compared to a one bedroom near a Metro station. I am stuck with close in places because of working in DC. Our office is moving at the end of the year (away from White House, closer to the Capital, but not that close). I expect that is going to be a fairly long term lease. Or it might even be into a government building. They haven’t told us much about it yet.
If you are commuting to someplace that is already outside the worst of the traffic, then living further out makes sense.
That’s within one of the “wedges” in the old “coridors and wedges” overall zoning plan for the “Maryland National Capital Region.”
I live right near that first house. It no longer looks like the photo, because there was a recent fire.* There is essentially nothing left. You are just buying the land, which is located on a busy commuting road with a sharp turn right near the house.
*Interestingly enough, the house experienced a chimney fire about 5 years ago and burned to the condition shown in the photo. Neighbors considered it a nuisance and a hazard, various suits were filed, and the property was listed at the same unyielding price for years, without success. Then, a couple months ago, a second fire in the same house burned the remaining structure down to nothing. Cause of the second fire is yet undetermined.
Wow, thank you.
And yes, I know that sharp turn. It comes up fast with little warning. there must be quite a few crashes there every year. If I were to commute, I would probably drive on parts of the same road. Luckily I don’t use the beltway, and I’m hoping to avoid 270.
And if the house is gone, then why is it still in the pic, and why are they charging that much for the land? That’s insane!
Are NYC folk ready for the red-hot summer rental market?
05/29/2011 03:00 PM
How Potential Renters Can Prepare For Summer’s Hot Rental Market
By: Jill Urban
As the rental market heats up this summer, property owners who want to rent instead of selling their space should make sure they are following all city rules and regulations. NY1’s Real Estate reporter Jill Urban filed the following report.
The local rental market is getting so hot that many would-be sellers are deciding to put off the sale and are renting out their homes instead. Ron Gitter, a real estate attorney and the founder of CoopAndCondo dot com, has seen the trend grow.
“At the moment, there is a very low rental vacancy rate, which drives the prices of rentals up,” says Gitter. “So it’s a very advantageous time, if you do own an apartment and you don’t have to live in it, it’s a great time to rent an apartment.”
…
http://market-ticker.org/
Memorial Day musings.
Every point made is fact.
Looking for affordable housing? Consider living with neighbors who are more likely than average to rape, murder or rob you.
America’s 10 most dangerous cities
Flint, Mich.
Another Michigan city - Flint - came in as the nation’s most dangerous city with 22 violent crimes per 1000 people, according to the FBI’s 2010 crime stats.
…
Questions for the defenders of HAMP:
1) Wouldn’t it have been best to just let borrowers and lenders sort out the mortgage mess without the intrusion of the federal government into the mess?
2) Given the bevy of legal issues (e.g. widespread evidence of fraud) connected to the mortgage collapse, wouldn’t the government have better spent its limited resources on upholding a Rule of Law in the financial system, rather than wasting them on bailing out greater fools?
Borrowers unhappy with Obama mortgage plan: study
Housing Market
A foreclosed home is seen for sale in Santa Ana, California, May 24, 2011. REUTERS/Lucy Nicholson
WASHINGTON | Thu May 26, 2011 5:25pm EDT
(Reuters) - Struggling homeowners seeking help from the Obama administration’s foreclosure prevention program have in many cases had negative experiences, a congressional report said on Thursday.
Three-fourths of the some 400 housing counselors involved in the process characterized borrowers’ overall experience with the housing program as “negative” or “very negative,” according to the Government Accountability Office (GAO) study.
According to the study, 40 percent of approximately 300 counselors said they had experienced difficulties working with the mortgage servicers and said paperwork had been lost or needed to be resubmitted.
The Treasury Department defended its actions, noting that the survey was conducted in October 2010 before improvements were made.
Treasury also took issue with the parameters of the study and said because there was no readily reliable database of borrowers seeking help, the GAO surveyed housing counselors as a proxy for borrowers.
“The survey results do not characterize borrowers’ actual experiences with, but rather counselors’ interpretations of borrower experiences,” the department said in response to the study.
…
It seems like Geithner and company just can’t stop themselves from attempting top-down, deus ex machina type fixes to the mortgage mess. So long as they keep meddling, the mess will keep on boiling.
MILLER: Obama’s $20 billion mortgage shakedown
Consumers to pay the bill for upside-down house loans
By Emily Miller
The Washington Times
7:37 p.m., Tuesday, May 24, 2011
President Barack Obama, accompanied by Elizabeth Warren, announces that Warren will head the Consumer Financial Protection Bureau, Friday, Sept. 17, 2010, during an event in the Rose Garden of the White House in Washington. (AP Photo/Susan Walsh)
The White House is hoping to strong-arm banks into paying off the mortgages of irresponsible homeowners at the expense of the rest of us. The idea is to tap financial institutions to create an unregulated $20 billion slush fund to pay off the principal for people who are upside-down and delinquent on their housing payments. Political appointees in the Obama administration would get to choose the winners and losers in the house pay-off lottery.
House Financial Services Committee Chairman Spencer Bachus wants Treasury Secretary Timothy F. Geithner to pull the plug on this bad idea. “We believe that a $20 billion principal reduction fund will create incentives to default that could worsen the housing crisis and impede economic recovery,” the Alabama Republican wrote in a May 6 letter to Mr. Geithner.
The White House is silent on the backroom deal being struck by the nation’s top-five mortgage firms and state attorneys general as part of a settlement of “robo-signing” charges brought by the Department of Justice. The banks were accused of failing to obtain all the proper certifications before foreclosing on some homes. However, there’s little evidence that anyone was foreclosed who hadn’t already defaulted on a mortgage.
…
I don’t trust the Washington Times to be impartial. And besides, if this program works anything like HAMP did, we have nothing to fear.
Sounds to me like Elizabeth Warren is the right woman for the job. Why can’t the administration muster the political will to roll the banking industry prostitutes in Congress who stand in the way of her appointment?
Why the big, bad banks are afraid
By LOREN STEFFY
HOUSTON CHRONICLE
May 28, 2011, 12:36AM
The big banks are tough.
They can handle Dodd-Frank. They can handle being labeled a “vampire squid” in the pages of Rolling Stone. They can even outlast the threat of criminal prosecutions for taking the global economy to the brink of collapse.
But what scares them the most is Elizabeth Warren, a Harvard law professor who has spent years learning their secrets.
Last week, the banks’ representatives in Congress grilled Warren over the Consumer Financial Protection Bureau, a panel created in response to the financial crisis that might just give consumers a fighting chance against banks’ exorbitant fees, debt spiral schemes and outright fraudulent lending practices.
The CFPB is designed to promote consumer understanding of financial products by promoting transparency among financial institutions. Republicans have vowed to water down the bureau’s powers.
Warren is a veteran of contentious congressional hearings, most recently ones she conducted as head of the oversight panel for the federal bank bailout. During those sessions, she squared off with Treasury Secretary Timothy Geithner over the government’s handling of bailout funds and its claims that banks’ balance sheets are sound.
Growing desperation
So last week, when Warren didn’t crumble under his badgering, Rep. Patrick McHenry, a Republican from Bank of America’s home state of North Carolina, decided to try to humiliate her. Knowing she had scheduling conflicts that had already been discussed with committee staffers, he tried to delay the hearing and when she protested, he basically called her a liar.
The lack of decorum speaks to the desperation that the big banks feel over Warren and the CFPB, an agency that she is helping to establish and that would have broad powers to act on consumers’ behalf.
“The discretion that the CFPB has is extraordinary,” Larry Young, a Houston attorney and expert on consumer finance law, told me recently.
Fees and other gimmicks now account for a greater slice of big bank profits, and the CFPB poses a real threat to banks’ bottom line.
…
Fees and other gimmicks now account for a greater slice of big bank profits, and the CFPB poses a real threat to banks’ bottom line.
Well, tough beans. If they can only make money via fees and other gimmicks, then it’s time to shut ‘em down, break ‘em up, whatever.
Care to guess who the biggest contributors to McHenry are?
http://www.opensecrets.org/politicians/summary.php?cid=N00026627&cycle=2010
We have a government which serves the highest bidder, not the people.
McHenry = banking industry whore
Joe 6pack is sticking up for Elizabeth Warren, by calling out McHenry on Facebook as a banking industry whore. This is turning out beautifully!
The efforts of the banksters to quash Warren’s ascent to power shows that she clearly is the right woman for the job of reinstating a Rule of Law in the banking sector. Bring her on!
P.S. I have a simple suggestion for stamping out banking industry whoredom from Congress:
Make any Congressman found guilty of accepting prostitution bribery payments from banksters spend a day in a Colonial stock. I’m guessing with this approach, the problem of banking industry prostitution could be drummed out of Congress overnight.
Rep. Patrick McHenry receives Facebook backlash over Elizabeth Warren
May 25th, 2011 10:35 am ET
Ryan Witt
Since yesterday United States Representative Patrick McHenry (R-NC) has been receiving a lot of “likes” on his Facebook page. Unfortunately for McHenry, most of the “likes” seemed to have come from people who simply clicked the “like” button to express their outrage at the Congressman. Yesterday McHenry got into tense exchange with Presidential Advisor Elizabeth Warren. Warren was attending a committee hearing chaired by McHenry. After taking pointed questions from Republicans for over an hour most of the committee members left to attend a vote. Warren also began to leave but then was told she needed to stay by McHenry. Warren claimed that she had made an arrangement with McHenry’s staff to leave by 2:15 to attend other meetings. McHenry claimed that Warren was essentially lying about the arrangement, which left Warren with a shocked look on her face from McHenry’s bold accusation. The entire exchange can be seen in the video to the left. Below one can find many of the comments left on McHenry’s wall over the last 24 hours.
“Make any Congressman found guilty of accepting prostitution bribery payments from banksters spend a day in a Colonial stock.”
Need to mount that stock on a pole with a lateral stick to stand on, and make it high enough that you can’t afford to fall asleep and let your feet slip off.
So McHenry, the pipsqueak who disrespected and disparaged E. Warren is a bought and paid for congressional whore.
What kind of crazy notions will the Megabankster PR corps cook up next?
“…will having more banks scrapping about in the market just make it a more dangerous place for all?”
May 31st 2011 - June 11th 2011
Banking
This house believes that more competition makes banking more dangerous.
Defending the motion
Franklin Allen
Nippon Life Professor of Finance and Economics, Wharton School, University of Pennsylvania
Thorsten Beck
Against the motion
Thorsten Beck
Professor of Economics and Chairman of the European Banking Center
Banking markets across the world have become increasingly concentrated over the past few decades. In the United States, the market share of the five biggest banks has increased to 34%, from less than 8% in 1994. Banks that before the crisis were thought to be too big to be allowed to fail have grown even bigger and failing institutions have been pushed into one another’s arms.
In large parts of the world, the idea of having a few very big banks is gnerally (SIC) thought to be a good thing. Economists and regulators thought that cozy banking oligopolies were so profitable that banks would be stupid to take any risks that might upset the status quo. What is more, having just a few big banks meant that regulators could watch them closely.
Yet now official wisdom seems to be turning 180 degrees. The European Commission’s competition regulators are busily trying to force banks to divest. Britain wants its banks to erect firewalls between their parts. Although not exactly splitting them up, it wants dotted lines drawn to allow for easy separation should that be required. And in the US, officials are pushing hard to tilt the competitive playing field in a way that will advantage smaller banks. Should our big banks be broken up, or will having more banks scrapping about in the market just make it a more dangerous place for all?
You have problem with Corporate Communist Capitalism©®™, comrade?
Big problems.
I’m all about breaking up the big banks, in order to restore the financial sector into its potential role of a service sector industry, rather than a systemic societal parasite.
Being of the ursine persuasion, I tend to side with Mr Lee’s view that gold is set to crash, alongside of equities, at the moment higher interest rates rear their ugly head, quelling inflation paranoia.
Housing
The great divide
May 9th 2011, 14:29 by Buttonwood
WHILE the equity and commodity markets have surged since 2009, the asset class that started all the trouble - US housing - hasn’t rallied. An overhang of foreclosed properties is still depressing the market while tighter lending standards make things difficult for bargain-hunters. The latest data suggest some 28% of homeowners are under water. But the chart, courtesy of Tim Lee of pi Economics, illustrates that US houses now look very cheap, especially if the high gold price does indicate that we are heading for a period of rapid inflation. Of course, the chart could equally show that gold is very expensive which, incidentally, is Mr Lee’s view. He thinks it is around two to three time overvalued, given the fundamentals; given that gold looks in line with equities, this implies very bad news for the stockmarket.
…
“President Reduces Amount Homeowners Owe”
Check out the cleavage on that poster babe for the Obama federally-subsidized refi program — makes me want to refinance today! (Sadly, I am not a loanowner, and hence don’t qualify for this subsidy…)
I’m still getting the Armando Montelongo ads, where I am told he can teach me how to flip houses for a quick buck.
I’ve been getting those too.
Yeah…. it’s aggravating. lowermybillsdotcom…. a site run by the thugs at experian.
U.S. judge rebukes foreclosure practices in Oregon
Posted: Monday, May 30, 2011 10:07 am
Associated Press
PORTLAND (AP) — The foreclosure fight in Oregon jumped to a new level last week after a federal judge in Medford rebuked the industry’s sloppy practices in blocking the seizure of a Jacksonville home, and mortgage issuers turned to the Legislature to find a quick fix to the legal quagmire.
U.S. District Judge Owen Panner questioned whether big banks should be allowed to foreclose without court supervision – as required in 23 states but not Oregon, where one in every 500 homes is in foreclosure, according to Realty Trac Inc. That’s compared with one out of 600 nationwide.
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Panner specifically warned of problems in cases involving the Mortgage Electronic Registration System. MERS was set up by the banking industry to rapidly package and sell mortgages as securities without recording each sale in county recorder offices.
The “MERS system raises serious concerns regarding the appropriateness and validity of foreclosure by advertisement and sale outside of any judicial proceeding,” he said Wednesday in a 16-page ruling.
“Given the numerous problems I see in nearly every non-judicial foreclosure case I preside over, a procedure relying on a bank or trustee to self-assess its own authority to foreclose is deeply troubling to me,” he wrote.
A spokeswoman for MERS, Janis Smith, said it would appeal the ruling, which Smith described as inconsistent with earlier court decisions in the state.
Since October, federal judges in six separate Oregon cases have halted foreclosures involving MERS, saying its participation caused lenders to violate the state’s recording law. At least one federal judge has ruled in favor of MERS, industry lobbyists said.
The mortgage and banking industry is turning to the Oregon Legislature for help. The House Judiciary Committee entertained a last-minute amendment to an affordable housing bill that would rid the recording requirements holding up MERS foreclosures. Lobbyists for banks, credit unions and title companies said the amendments were needed to lift a cloud over thousands of Oregon homes.
“It’s created a significant issue for the title industry, certainly, and, among others, the people who own these homes,” said Alan Brickley, an attorney for First American Title Insurance Co. in Portland. The Northwest Credit Union Association and Oregon Financial Services Association also testified in favor of the amendment.
The amendment was proposed to Senate Bill 519, which is designed to protect affordable housing financing in foreclosures. Its introduction sent the bill’s co-sponsor, Sen. Suzanne Bonamici, D-Beaverton, and a deputy of Oregon Attorney General John Kroger scrambling to defend the state’s existing recording law.
Committee co-chair Wayne Krieger, R-Gold Beach, postponed action on the amendment until Tuesday.
“It’s a gut and stuff and will emasculate the recording requirements,” said Phil Querin, a real-estate attorney in Portland. “It should be strongly opposed.”
Nationwide, the pace at which homes are entering the foreclosure process has slowed in recent months amid bank and court delays, but Realty Trac today estimated they still account for at least one of every four home sales.
Meanwhile, federal regulators and all 50 states continue investigating major financial institutions amid reports of flawed foreclosure practices. California and Illinois plan to investigate whether Lender Processing Services Inc. rushed the processing of foreclosure cases for lenders in a practice known as “robo-signing.”
Most foreclosures in Oregon occur relatively quickly outside of a courtroom. But state law requires the lender to clearly document its interest in the property or prove its case in court.
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A book describing the mortgage meltdown as “financial origami” - take an initial product and keep folding it and folding it, selling each product along the line. Haven’t read it, but the description is intriguing.
New book explains housing meltdown as Financial Origami
By Ilana Greene, Special for USA TODAY
Posted 18m ago
In Financial Origami: How the Wall Street Model Broke, Brendan Moynihan argues that origami is what Wall Street does in creating financial products. Bankers take stocks, bonds and insurance contracts and fold them into new, complex financial instruments.
Moynihan takes us down a trail that begins with savings and loans providing home buyers with conventional mortgages and ends with investment banks enticing investors with high-yielding mortgage-derived exotica. Step by step, or fold by fold, he explores the mortgage securitization chain, explaining mortgage-backed securities, collateralized debt obligations, credit default swaps and synthetic CDOs.
http://www.usatoday.com/money/books/reviews/2011-05-27-financial-origami-book-review_n.htm
Do these journalists live in bizarro world? In what universe are lower prices bad for affordability?
This bleating, that lower prices are a bad thing (they’re certainly bad for certain groups - flippers and their financiers) are bad for potential homeowners is one of the most breathtakingly asinine things I’ve read. Unfortunately, it seems to be a common theme.
The desire to own your own home, long a bedrock of the American Dream, is fast becoming a casualty of the worst housing downturn since the Great Depression.
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Disenchantment with real estate is bound to swell further on Tuesday when the most widely watched housing index is all but guaranteed to show that prices of existing homes sank in March below the lows reached two years ago — until now the bottom of the housing crash. In February, the Standard & Poor’s/Case-Shiller index of 20 large cities slumped for the seventh month in a row.
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In a recent paper, a senior economist at the Federal Reserve Bank of Kansas City found that the notion that homeownership builds more wealth than investing was true only about half the time.
“For many households in many years, renting and investing the saved cash flow has built more wealth than homeownership,” the economist, Jordan Rappaport, concluded.
http://www.nytimes.com/2011/05/31/business/31housing.html?_r=1
The article should have touched on the rent-v-buy calculation, and/or the median income-v-home price to illustrate how far from normal the RE market is today. It’s difficult to be critical without real numbers. Why not select a median household, and pie-chart their cash flows; will it work both short and long term?
‘“For many households in many years, renting and investing the saved cash flow has built more wealth than homeownership,” the economist, Jordan Rappaport, concluded.’
It’s certainly worked well for us the past six years!
Japan Faces Debt Downgrade as Jobless Rise Adds to Kan’s Woes
By Keiko Ujikane and Aki Ito - May 30, 2011 8:42 PM PT
Japan’s debt rating was put on review for a downgrade by Moody’s Investors Service, adding to Prime Minister Naoto Kan’s fiscal challenges after an increase in joblessness and smaller-than-forecast gain in industrial output.
Faltering growth prospects and “a weak policy response” may hinder efforts to cut the nation’s debt burden, said Moody’s, which had put the Aa2 rating on negative outlook in February. Government reports showed that production rose 1 percent in April, half the median estimate in a Bloomberg News survey, while unemployment rose to 4.7 percent from 4.6 percent.
Kan, facing a no-confidence motion in parliament, said today he won’t step down, signaling continued political infighting that may hamper legislation to finance long-term reconstruction after the March earthquake and tsunami. Japan, which has the world’s biggest public debt, saw its currency retreat for a second day against the dollar and bonds fall.
“This means we’re one step closer to a downgrade, and it reflects how we haven’t seen any political progress on fixing public finances,” said Yoshimasa Maruyama, a senior economist at Itochu Corp. in Tokyo. “There are still plenty of people in the JGB market to keep buying, so it’s not like we’re going to see a sudden spike in yields. But this will put upward pressure on yields through an added risk premium.”
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Which poster was insinuating earlier today that the banking crisis is behind us?
Clearly, they are mistaken.
EU works on Greek bailout; Germany may ease resistance
By Jan Strupczewzki and Harry Papachristou
BRUSSELS/ATHENS | Tue May 31, 2011 12:24am EDT
(Reuters) - The European Union is racing to draft a second bailout package for indebted Greece to release vital loans next month and avert the risk of the euro zone country defaulting.
Germany, which along with some other countries had resisted extra funding, is considering concessions in efforts to support the country by dropping its push for an early rescheduling of Greek bonds, the Wall Street Journal reported on Tuesday.
A recognition that Germany must lend Greece more money even without bondholders sharing the burden in the short term would help Europe overcome its impasse over the country’s funding needs before it runs out of cash in mid July, the newspaper reported, citing people familiar with the matter.
The news lifted the euro to a three-week high against the dollar in Asian trading on Tuesday as the perceived risk of an immediate debt restructuring eased.
Greece took a 110 billion euro ($158 billion) rescue package from the EU and IMF last May. The risk of a default on its 327 billion euro debt reared its head because Greece has fallen short of its deficit-reduction goals.
Moves to plug a looming funding gap for 2012 and 2013 became more urgent after the International Monetary Fund said last week it would withhold the next tranche of aid due on June 29 unless the EU guarantees to meet Athens’ funding needs for next year.
Uncertainty over whether Greece will receive the 12 billion euro aid tranche, required to meet 13.4 billion euros in funding needs in July, has rattled financial markets.
Senior EU officials held unannounced emergency talks with the Greek government over the weekend, an EU source said. On Monday, EU officials said they were working on a package.
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Leaving North Las Vegas no option for many ‘underwater’ homeowners
In parts of North Las Vegas, more than 80% of homeowners owe more on their mortgages than their homes are worth. Staying is expensive, but many can’t afford to move.
By Ashley Powers and Alejandro Lazo, Los Angeles Times
May 31, 2011
Reporting from North Las Vegas, Nev.—
Charles Mills can barely afford to stay here. But he also can’t afford to move.
That’s why the 44-year-old heavy-equipment operator was preparing to leave his wife and young daughter here and go where he could find work — the Oklahoma oil fields. Mills has a mortgage to pay, even if its size pains him.
He purchased his house in 2006 for $308,500. Current value: $105,797.
“We talked about it: What can we do with the house?” Mills said. “Nobody’s going to buy it. Nobody’s going to rent it. If we walk away, my credit’s shot. We’re stuck.”
In some parts of North Las Vegas, more than 80% of homeowners have plunged “underwater,” meaning they owe more on their mortgages than their properties are worth — a stunning concentration of aborted plans and upended lives.
Mobility in search of new opportunity has long been a cornerstone of the American economy, much the way homeownership has long offered a path to firmer financial footing. But the housing bust has left tens of thousands of homeowners across Nevada essentially trapped.
They’re considered the new normal here. They turn down higher-paying jobs elsewhere because they can’t move. They tidy the yards of houses left vacant by foreclosure. They realize it’s unlikely their children will receive tidy inheritances from the sale of their suburban homes.
When they look about their neighborhood, they question things they never questioned before. Are dead plants a sign that someone forgot to water? Or did the water get turned off? Does a garage sale mean more neighbors are about to bail?
“We don’t even walk around our own neighborhood anymore,” Mills said. “Why? To say hi to strangers?”
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May 31, 2011, 12:01 a.m. EDT
R.I.P. Reaganomics Revolution: 1981-2011
Commentary: Like the Roaring Twenties, ending in a crash
By Paul B. Farrell, MarketWatch
SAN LUIS OBISPO, Calif. (MarketWatch) — The 30-year Reaganomics Revolution will be over soon. Like the Roaring Twenties, ending in the game changing crash. Though more than 80 years apart, they share a common theme song of irrational exuberance: “I’m Forever Blowing Bubbles.”
Many bubbles, now merging like tornadoes, in a perfect storm, a megabubble itching to blow, signaling the end of the ego-centered Reaganomics Revolution, which must, unfortunately, also take down America’s markets, economy and monetary system.
Yes, folks, that one song captures the collective mind-set of both the Roaring Twenties and the Reaganomics Revolution: “Forever blowing bubbles. Pretty bubbles in the air. Dreaming dreams. Scheming schemes. Building castles in the sky. Fortune’s always hiding. I’ve looked everywhere. Forever blowing bubbles. They fly so high, nearly reach the sky. Then like my dreams they fade and die.”
Then … like our dreams … they fade … and die. Nearly a century ago the bubbles popped in the Crash of 1929. Then the bubbly went flat during the long Great Depression. It repeats with the Reaganomics Revolution’s endless “pretty bubbles.” For a generation we have watched the damage created by a selfish ideology: The S&L disaster. Dot-com crash. Wars. Subprime meltdown. Great Recession. And, yes, there’s more to come, more “pretty bubbles.” You’ll see below.
Irrational exuberance blinds us. On March 20, 2000, as dot-com exuberance raged, our column began: “Next Crash, You Won’t Hear It Coming.” Then came a 30-month recession. We went on reporting 20 advance warnings of the 2008 meltdown. Nobody listened. Till it was too late. Till a conflicted Treasury Secretary, myopic Fed Chairman and clueless Congress all panicked, making matters worse, setting up a new meltdown, dead ahead.
Reaganomics Revolution destroyed values of American Revolution 1776
Today our collective brain has been consumed by a greed-is-good virus. We have lost our moral compass. The values of the American Revolution of 1776 are dead. The Reaganomics Revolution has replaced those values with the unregulated free market with an “every man for himself, get rich quick” ideology that’s destroying America from within:
In the Bush years some cocky conservatives predicted a “permanent majority” lasting “for years, maybe decades.” The hubris gods had other plans. Then after Obama’s election, one cocky liberal wrote “40 More Years: How the Democrats Will Rule the Next Generation.” Wrong again. Both parties will lose in the final flame-out of the Reaganomics Revolution.
Yes, so many “pretty bubbles” merging. And still, the pundits and press love the bull, arguing that no one bubble is a game-ender. Even after a generation of increasingly bigger, more frequent economic disasters drain our fiscal and monetary resources, raising our debt to unsustainable levels, destroying our trust in democracy, it’s now obvious that America many “pretty bubbles” are making us vulnerable, inviting trouble.
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May 31, 2011, 12:01 a.m. EDT
What, me worry?
Commentary: Economy is much weaker than some say
By Irwin Kellner, MarketWatch
PORT WASHINGTON, N.Y. (MarketWatch) — Most economists did not think that the economy would hit another soft patch so soon after emerging from the last one.
Now that the current quarter is two-thirds finished, it is rapidly becoming apparent that, for the second quarter in a row, pundits overestimated the pace of economic activity.
They missed the first quarter’s growth rate by a wide margin. Instead of the 4% expected by the consensus at the turn of the year, the first quarter instead grew at only a 1.8% clip.
As I pointed out in my column of April 19 , these great expectations sprang from a reasonably good holiday-shopping season, rising employment, and several other positive indicators.
But by the time the first quarter arrived, the economy began to be buffeted by a number of headwinds, among them a sudden jump in oil prices; Japan’s earthquake, which produced shortages of key components for cars and other goods; and the flap over Washington’s budget, which led to a near-shutdown of the government.
The past winter’s storms and housing’s continued problems also subtracted from the first quarter’s growth.
Undaunted, economists cranked up their models and came up with forecasts that showed growth bouncing back to as much as 3.5% in the current quarter. They figured that these headwinds would abate and/or be offset by other, more positive developments.
Well it looks like they were wrong again. As the data for April and May unfolded, many economists began to back off from these sunny views. The MarketWatch consensus now expects an increase of just over 3% for the second quarter.
In my view (which has been consistent, by the way), these forecasts will once again prove to be too optimistic. Energy prices are still high, the pols are bent on cutting spending thus dragging economic growth, and inflation continues to wreck havoc with people’s budgets.
Housing remains in the doldrums, factory output is still feeling the effects of the disruptions in the supply of components because of Japan’s earthquake, and to top it off, gains in employment appear to be abating.
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