The Housing Bubble

Thank you to Oxy for showing us how to respond to a request for comments on an important housing bubble matter!

Just want to throw this out there - not whining or anything -

WAAAAHHH!! WAAAHHHH!

- But I DID do the promised posting on Oil City on Monday July 4th. I even included supplementary material.

It includes lots of information about houses and house prices, and general sociological commentary. Although I forgot to mention the shale bluffs overlooking Oil City, which are frequented by fossil hunters, which I did not have time to go explore. So, Oxy, that one’s for you, please read and let’s go back up there, it’s NICE country!

I have another piece of news which is not housing related, except that it may allow me to better afford my prospective rent increases. So far they have been tolerable, but only because I exercise sangfroid and take very good notes about observed housing violations.

I can barely wrap my head around the following circumstance, because it is so foreign to me. I applied to one of the MS/Eng programs at JHU, and got accepted for the fall term. Under the premise that in a technology town that is KRRAAAZEEE about Credentials, you gots to Officially larn you some Technology. I are gonna larn me sum Enginneering, an I are gonna be Offishul.

Although the company is footing the bill if I get grades beyond the clip level, I gots a feeling this is one degree where I might actually have to fork over some dough. No matter, it’ll be something new, I like reading, and even in the worst case it’s cheaper than buying a house. I am going to take it on faith that the course of study is not going to cure me of veering off topic.

Like I said, big shock.

Refinancing Drop an Ill Wind for Housing Recovery
By: Diana Olick CNBC Real Estate Reporter

Does anyone remember when the rate on the 30-year fixed mortgage was up around 8 percent? I do.

Perhaps that’s why it continues to stun me that a tiny shift in our now ultra low rates can have a huge effect on consumer activity, namely refinancing. No question, it is a statement on just how tight and how sensitive our current mortgage market is today.

According to the Mortgage Bankers Association’s weekly survey, “The Refinance Index decreased 9.2 percent from the previous week. The Refinance Index has decreased for 3 consecutive weeks, reaching its lowest level since May 6, 2011.”

The mortgage bankers cite a jump (and by jump, I mean more like a hop) in rates on the 30 year from 4.46 percent to 4.69 percent. This is the highest rate since mid-May, they note, which I will note was just two months ago.

Yes, that’s a pretty large jump, but we are still below 5! The trouble is that there is a very small pool of eligible refinancers right now, because 1) so many have already refinanced at these incredibly low rates, 2) many borrowers are still underwater on their homes, which makes them largely ineligible for super low rates and 3) many borrowers don’t have enough equity or the proper credit score to get into a refi that’s worth the cost.

So the refinance share of mortgage applications continues to drop. Why should we care? What we really want is to see purchase applications, because that means people are buying houses, and that number did go up a bit last week although it’s still down for the month of June. But wait:

“The increase in the share of homes being bought with cash and the likelihood that the NAR’s (National Association of Realtors) existing home sales data are being overestimated by between 10 percent and 20 percent means that the relationship between mortgage applications and total home sales is not as close as it once was,” said Paul Dales of Capital Economics, who believes sales figures are still historically low.

But let’s think for a second about what the economy gains from a refi boom? Consumers save more money, which gives them more money to spend. Saving more also gives consumers more confidence in their financial situation, which helps the economy in varied ways. Refinancing can also help some troubled borrowers avoid defaulting on their loans.

I’m not saying I want to see us go back to the days of using our homes as cash machines. I do want to go back to the days when our homes weren’t draining us dry.

Consumer delinquencies tick up in first quarter
WASHINGTON | Thu Jul 7, 2011

(Reuters) - More consumers had trouble making payments on credit cards and other debts during the first three months of the year due to higher food and gas prices, an industry report said on Thursday.

The American Bankers Association said the data showed a downturn from prior quarters and described the most recent quarter as a “soft patch.”

“Consumers are feeling insecure about the economy and whether their financial resources can carry them through until conditions improve,” ABA chief economist James Chessen said in a statement.

“With a slow-growing economy and weak job growth, there will continue to be financial stress that will make it hard for some people to pay their bills on time.”

Exclusive: Treasury secretly weighs options to avert default

(Reuters) - A small team of Treasury officials is discussing options to stave off default if Congress fails to raise the country’s borrowing limit by an August 2 deadline, sources familiar with the matter said on Wednesday.

Senior officials, including Treasury Secretary Timothy Geithner, have repeatedly said there are no contingency plans if lawmakers do not give the U.S. government the authority to borrow more money.

But behind the scenes, top Treasury officials have been exploring ways to prevent a financial meltdown that would be triggered if the government were unable to pay its bills on time, sources told Reuters.

Treasury has studied the following issues:

- Whether the administration can delay payments to try to manage cash flows after August 2

- If the U.S. Constitution allows President Barack Obama to ignore Congress and the government to continue to issue debt

- Whether a 1985 finding by a government watchdog gives the government legal authority to prioritize payments.

The Treasury team has also spoken to the Federal Reserve about how the central bank — specifically the New York Federal Reserve Bank — would operate as Treasury’s broker in the markets if a deal to raise the United States’ $14.3 trillion borrowing cap is not reached on time.

The U.S. government currently borrows about $125 billion each month. The Obama administration wants Congress to raise the limit by more than $2 trillion to meet the country’s borrowing needs through the 2012 presidential election.

I say we elect one of our resident nomads to live there for a year and investigate… how does “Bill in Oil City” sound?

The U.S. just needs to focus more on the entertainment industry.

Service Industries in U.S. Expand at Slower Pace in Sign Economy Cooling
(Bloomberg)

Service industries in the U.S. expanded at a slower pace in June, a sign the economy cooled at the end of the first half of 2011.

The Institute for Supply Management’s index of non- manufacturing businesses decreased to 53.3, less than projected, from 54.6 in May. Economists forecast the gauge would drop to 53.7, according to the median estimate in a Bloomberg News survey. A reading above 50 signals expansion.

Service companies, which account for about 90 percent of the economy, joined manufacturing last quarter in slowing as a 9.1 percent unemployment rate limited consumer spending. Businesses like FedEx Corp. (FDX) project the expansion will pick up through the rest of the year as gasoline prices provide relief for households and supply disruptions from Japan abate.

“We’re closing the door on a very disappointing first half of the year, which wasn’t a disaster but highlights the fragility and the difficulty of this recovery,” said Julia Coronado, chief economist for North America at BNP Paribas in New York. In coming months, “some of the relief in commodity prices should help businesses maintain margins and therefore become a bit more confident in doing things like investing and hiring,” she said.

Use of prisoners for labor is nothing new, if I were sitting in prison and had a chance to get outside and work I’d jump at the chance. This is not the old style chain gangs, it’s a choice, not forced.

Union Workers Replaced With Prison Labor Under Scott Walker’s Collective Bargaining Law By Alex Seitz-Wald -thinkprogress.org

While Wisconsin Gov. Scott Walker’s law dismantling collective bargaining rights has harmed teachers, nurses, and other civil servants, it’s helping a different group in Wisconsinites — inmates. Prisoners are now taking up jobs that used to be held by unionized workers in some parts of the state.

As the Madison Capital Times reports, “Besides losing their right to negotiate over the percentage of their paycheck that will go toward health care and retirement, unions also lost the ability to claim work as a ‘union-only’ job, opening the door for private workers and evidently even inmates to step in and take their place.” Inmates are not paid for their work, but may receive time off of their sentences.

The law went into effect last week, and Racine County is already using inmates to do landscaping, painting, and another basic maintenance around the county that was previously done by county workers. The union had successfully sued to stop the country from using prison labor for these jobs last year, but with Walker’s new law, they have no recourse. Watch a report from Fox6 in Green Bay:

The Washington Examiner called Racine’s move “another success story” and “all great news for Wisconsin taxpayers. Hopefully, we’ll see more of it.” So far, it appears no other jurisdiction has followed Racine’s example — for now. It may just be a matter of time to allow existing union contracts to expire. The spokesperson for the Sheriff’s Office of Dane County, which includes Milwaukee, said, “Nobody in our jail will be benefiting…at this time” from the new law, but the left the door open for future changes.

While giving prisoners more work and activity options is generally positive, using free inmate labor to replace public sector workers is a disturbing trend.

Starbucks’ employees in Chile plan strike: report

(Reuters) - Employees at Starbucks Corp’s (SBUX.O) outlets in Chile plan to walk out on Thursday because, they say, their wages are so low that they can’t afford to buy lunch, the Wall Street Journal reported.

Unionized employees at 30 of Starbucks’ 31 Chilean stores plan to walk out for as many as several days the Journal reported, citing the president of the union Sindicato de Trabajadores de Starbucks Coffee Chile.

The starting hourly wage for Chilean Starbucks workers is the equivalent of $2.50 and has not changed in eight years the Journal said on its website, citing the union president.

The coffee chain’s employees in Chile have been pressing for a lunch stipend since they organized two years ago and in April the union presented the company with a proposal seeking a monthly lunch bonus of $100, among other requests, the Journal reported.

But because the demands have not been met the union voted to strike on June 25, the paper said.

Starbucks could not be immediately reached for comment by Reuters, but the Journal cited a company spokesman as saying the company will be able to keep all of its stores open if the strike happens.

Sellers Brace for New Mortgage Caps

October Change Is Meant to Reduce the Government Footprint in Housing, but Industry Fears It Could Lead to Lower Prices.

By NICK TIMIRAOS And ALAN ZIBEL
JULY 6, 2011.

The federal government is readying its first retreat from the mortgage market, with the size of loans eligible for government backing set to decline in October.

As an emergency measure three years ago, Congress raised to as high as $729,750 the maximum loan amount that Fannie Mae, Freddie Mac and federal agencies could guarantee.

Now those limits are set to decline modestly in hundreds of counties across the U.S. as the government attempts to reduce its outsized footprint in the mortgage market and create room for private investors to compete. Government-related entities stand behind more than nine of 10 new mortgages, and taxpayers have sunk $138 billion into Fannie and Freddie, underscoring the eagerness to dial down the government’s share.

The new limits will vary widely by location, but will drop to $625,500 in top-tier markets such as New York, Los Angeles and Washington, D.C.

Even though the new limits won’t take effect until Oct. 1, some lenders are already warning borrowers that they will stop accepting applications for loans that exceed the new limits much sooner, to ensure the loans are funded before the cutoff date.

Homeowners whose mortgages are too big to qualify for a government-backed mortgage must seek a so-called jumbo loan, which often carry higher interest rates as well as larger down-payment requirements, sometimes more than 20%.

“Sellers are going to have to reduce their prices if borrowing costs rise,” said Scott Sheldon, a loan officer with First Cal Mortgage in Petaluma, Calif.

http://online.wsj.com/article/SB10001424052702303763404576420101788878440.html - 210k -

Irish Begged to Buy Fridges to Boost Economy
By Finbarr Flynn and Dara Doyle - Jul 7, 2011- Bloomberg

Tara O’Neill stands empty-handed and defiant outside a Marks & Spencer store on Dublin’s busiest shopping street. She won’t be tempted to buy anything.

“I’ve gotten rid of my credit cards and paid down my overdraft,” said O’Neill, 36, whose construction worker husband is in London after Ireland’s real-estate bubble collapsed. “Now we’re in recession. I don’t buy what I don’t have to.”

Irish retail sales are falling at more than twice the pace of the average in the euro region, after the government increased taxes and reduced salaries for state workers by 14 percent to help cope with Europe’s worst banking crisis. Consumer spending plunged 1.9 percent in the first quarter from the fourth quarter, the steepest drop in two years, according to figures published last month by the statistics office.

With household expenditure accounting for 53 percent of the economy, Ireland’s ability to emerge from its deepest economic contraction in history may depend on persuading people like O’Neill to start spending the cash they have left. The yield on 10-year Irish bonds rose to a record today amid speculation that the nation’s credit rating may join Greece and Portugal in being downgraded to junk.

Finance Minister Michael Noonan lowered the sales tax on everything from haircuts to meals to 9 percent from 13.5 percent starting July 1 and also has pleaded with consumers to replace their “clapped out” refrigerators and tumble dryers.
‘Guerilla Raids’

“There’s a whole generation of Irish people who were born to shop and they’ve had to change their behavior entirely,” said Austin Hughes, chief economist at KBC Ireland in Dublin, which publishes a monthly index of consumer sentiment. “It’s like they are burrowing deeper into their foxholes, saving and paying off debt, and only coming out for guerilla raids when they see a big bargain.”

When I read articles like this, I know that The Powers that Be have won:

America, down but not out: A nation of fighters responds
Bob Sullivan / msnbc dot com

Is this the new normal — a mom with 7-week-old twins waiting tables for travelers at a late-night diner?

I interviewed dozens of people during my just completed cross-country journey, but my idle late-night chat with a waitress in southern Idaho seemed to strike the loudest chord with readers….

“I have an 18-month old at home,” she said. “And two 7-week-old twins.” Her husband works during the day, and she works at night so someone is always with the kids.

…barbs were slung about this anonymous waitress, who seemed to draw forth every political argument of the past half-century — about our inadequate health care and maternity leave systems; about low minimum wage standards; about a lack of economic opportunity in small towns, or large ones; about the two-income trap that forces both parents to work to survive; about birth control — she should have used it, some said — and about letting people sink or swim on their own personal choices. Any many more.

One thing seemed undeniable, however: the waitress and her story made us angry. Or rather, she exposed our anger.

To drive across this great country, coast to coast, is to engage its beauty, its history and its spectacular depth. Making the trip today, however, forces a traveler to confront something else: the unmistakable frustration that grows with each passing month of anemic recovery from a bad recession. The unemployed are tired of looking for work; the underemployed are tired of being insulted by their bosses; home sellers are exhausted trying to find buyers. Even people who are doing OK feel stuck, wondering when their next city park might close, if their health care co-pay is going up or when might be a better time to open a small business.

We are tired, and we are angry.

But we are Americans, which means we don’t give up.

I was privileged during this past three weeks to meet hundreds of msnbc.com and Red Tape readers who overwhelmed me with their stories about fighting cable TV and cell phone fees, fighting school taxes, fighting to keep small towns alive — and, yes, fighting with burger customers at midnight so their children will have a chance. The common thread is obvious. Sometimes it can get ugly, and it’s almost always uncomfortable, but America is a nation of fighters. That spirit is our greatest national resource. That is what will pull us through this dark time.… [commence anecdotes]

—————-

Bob Sullivan writes columns about consumers fighting back, but they are frying only the small fish: cell phone fees, free cable, or fine print on credit cards. At most, he covers ID theft.

Memo to Bob: The Powers That Be don’t give a crap if you call to complain enough to get a $39 late fee waived on your credit card bill. They’ve already made up their $39 by paying someone in India to handle your call. They want your $520 a month in health care premiums; if you’re old and on Medicare, they want that $520 a month to come from the evil government and filter through their “administrative costs” before any care reaches you. They want that $22K per year from the government student loan to pay for inflated college, and they want that $14K in interest when you pay the loans back. They encourage you to get your health care from Medicaid so that they don’t have to provide it. They want you to pay your taxes so they don’t have to pay theirs. They want your $1899 I/O payment on your mortgage before they foreclose anyway. They give tax breaks to their buddies so they can blame the deficit on your $1400/month “lavish” pension. Most of all, they want your $50K/year job so they can give it to someone who will do it for $12K.

So, TPTB welcome stories like this. The decoy worked, the masses have been distracted from the big money. Let the little guys fry their little fish and pat each other on the back for “the fighting spirit” and “overcoming adversity” and the “triumph of the American spirit.” Let them feel proud of themselves for refraining from buying $3.69 for coffee while they fork over thousands of dollars in cheated money without question.

Because that’s what America is really about: money, goodies, health, leisure for the rich, while the rest “will get pie in the sky until we die.”

None of these states should allow Casey Anthony to move there, they are already running out of children.

24/7 Wall St.: 10 States Running Out of Children

http://xfinity.comcast.net/slideshow/finance-10statesrunningoutofchildren/the-states-running-out-of-children/?cid=hero_media - -

Farkas!

Housing prices: No rebound in sight
NEW YORK (CNNMoney) — Housing prices are likely to keep falling the rest of this year, and probably won’t show much improvement next year either, according to a survey of economists.

A CNNMoney exclusive survey of 27 economists showed the battered housing market is facing myriad problems and won’t turn around anytime soon.

Of the 22 who had specific predictions for the closely watched Case-Shiller home price index, the median forecast was for a 3.9% decline in the second quarter compared to a year earlier, and a 2.9% drop in prices over the course of the full year.

Only three economists expect prices to rise this year.

The outlook for 2012 is only modestly better — a 2% increase in home values, with six of the economists forecasting another drop in prices next year.

Nearly half were looking for a significant improvement in the labor market to boost housing, while the rest believe it will just take time to work through the inventory of foreclosed homes.

One economist, Kevin Giddis, head of fixed income at Morgan Keegan, said he believed it would take further significant declines in home prices in order to set a true bottom for the market.

Giddis is forecasting a 4% drop in prices this year.

Several others said all of those things need to occur before the housing market can show meaningful improvement. To top of page

Listings dropping like a rock! It must be a great time to buy.

Home Type Single family
Homes Sale

SEARCH ASSIST by REALTOR.com”

Jupiter Fl. 33458

Beds 3 2 Baths
405 Listings Found
Listings last updated 7 minutes ago Search by MLS #Search

Obama puts Medicare, Social Security cuts on the table
~ Yahoo.com

The Obama administration, in seeking $4 trillion in spending cuts in a debt limit deal, has put major changes to Social Security and Medicare on the table if Republicans agree to increased tax revenues.

The offer caters to both sides in the debt limit negotiations and according to the Washington Post, President Obama will urge congressional leaders on Thursday to seize the opportunity to act. The compromise, however, still puts both Republicans and Democrats in tough spots.

Democrats have vowed to protect Medicare and Social Security, while Republicans still argue that tax increases are not realistic legislative proposals. If leadership from both parties agree to the Obama’s compromise, the next move will be to sell the plan to their respective bases and to members of Congress.

But Thursday’s meetings at the White House will reveal just how many concessions each party is willing to make.

The president has reportedly already privately discussed his plan with Speaker of the House John Boehner. Michael Steel, spokesperson for Boehner, though, told the Washington Post “there are no tax increases on the table.”

Feds say the newest mortgage fraud is reverse mortgage fraud

By Jeff Ostrowski Palm Beach Post Staff Writer
Posted: 6:06 p.m. Wednesday, July 6, 2011

In a $2.6 million scam, three Palm Beach County men used bogus appraisals to take out reverse mortgages on behalf of unwitting borrowers, federal prosecutors said Wednesday.

In one phony deal, the trio convinced reverse mortgage lender Genworth Financial that a Sunrise condo appraised at $31,000 was really worth $275,000.

The U.S. Attorney’s Office said Louis Gendason, 42, of Delray Beach, and John Incandela, 24, and Marcus Echevarria, 29, both of Palm Beach, each face one count of conspiracy to commit wire fraud. The three worked as loan officers for First Continental Mortgage, which had offices in Fort Lauderdale and Boca Raton. The office said it was its first reverse mortgage fraud prosecution

http://www.palmbeachpost.com/money/real-estate/feds-say-the-newest-mortgage-fraud-is-reverse-1587282.html - -

Last year Treasury printed more $100 bills than dollar bills for the first time. There are now more than seven billion pictures of Benjamin Franklin in circulation — and the Federal Reserve’s best guess is that two-thirds are held by foreigners.

http://www.nytimes.com/2011/07/07/business/07currency.html?_r=1&ref=business&pagewanted=all

Snakes Force Family From Home, Into Bankruptcy

MAYBELL, Colo. (CBS4) – A Colorado family has moved out of their house after discovering hundreds of snakes living inside. Their home was in the town of Maybell in northwestern Colorado. Now a bankruptcy court may sue the previous owner and real estate agent for failure to disclose the snakes were there.

It looked like a gem — four bedrooms, four baths. But once Cynthia Beaver and her family moved in they discovered the snakes.

“A friend was babysitting our animals and she said, ‘I don’t want to alarm you but there’s a snake back there.’ And then pretty soon there was just hundreds of them,” Beaver said.

Beaver took pictures of them and tried to get rid of them, without any luck. The snakes apparently decided they were there first and weren’t leaving.

“So you’d look back here and there are snakes with their heads sticking out between the siding with their tongues flicking in and out,” she said. “It was way nasty.”

The family quickly made a decision — if the snakes weren’t leaving, they were.

“You expected them to just drop from the ceiling. It was just a nasty feeling. You couldn’t go in the cereal boxes because we were afraid, ‘What if there was a snake in there?”

The dispute over the snakes has gotten a bit nasty as well. The Beaver family claims the real estate agent who sold them the house failed to mention anything about snakes at the closing after being asked about such a rumor. That salesperson insisted she had no knowledge of snakes from previous owners and pointed out the Beaver family chose not to have a professional home inspection done.

“We had to file for bankruptcy to get rid of the house – we lost all of our credit, everything.”

Now the house is for sale as a bank foreclosure. CBS4 obtained the listing brochure which simply says “As Is.” CBS4 investigator Rick Sallinger called the new agent who was selling it. He asked the agent if she was aware of any prior history of problems. She said years ago previous owners stated there had been some snakes, but she hasn’t seen any and it has been remedied.

Such a problem is not unheard of. The Animal Planet channel did a story about a family in Idaho. Their yard was infested with garter snakes. They also left their home and filed for bankruptcy.

A lawsuit is in the works over the Maybell home. The previous owner of the house told CBS4 he was not aware of any snakes when he sold the house. He did not want to say more because a lawsuit is expected to be filed by the bankruptcy trustee over whether the issue of snakes should have been disclosed.

China is doing it’s part…

U.S. Timber Exports to China Have Lessened the Economic Blow for Some July 06, 2011| FoxNews.com

The timber industry has been a surprising bright spot in the U.S. economy.

Even as the housing market continues to sputter and home building remains stuck at levels one-third of the boom times of 2006, exports to China have softened the blow.

In 2010, timber exports to China more than doubled compared with 2009. The country spent $270 million on U.S. trees, surpassing Japan and Canada as the largest foreign timber market. The winners are the big, private timber companies.

“Last year, if you look at the growth to Japan, it was about 15 percent,” says Bruce Amundson, with the international forest products company Weyerhaeuser. “Compare that with about 300 percent to China.”

Most of the wood is being cut from private timberland in the Pacific Northwest, where the timber industry has been struggling for years under environmental restrictions spawned by battles over the spotted owl and other endangered species.

Logs are loaded onto ships at the Port of Olympia creating dozens of jobs. Officials say timber exports to China through the Port of Tacoma are up 500 percent in the past decade.

The export explosion also has helped taxpayers in Washington state. The Department of Natural Resources manages some forest land for timber. Even though state and federal law prohibits logs coming off of public land from being exported, timber is a global commodity so the price for public timber also is going up.

“We’re seeing an increase of probably $60 million,” says Bryan Flint of Washington’s DNR. “That will go to school construction and to pay for colleges and go to counties.”

But not everyone is celebrating. With China opening its wallet, the price of timber not only stabilized, but actually went up. That means the price local mills pay for logs has skyrocketed. And yet, they’re not getting any more for their cut lumber because the housing starts remain anemic. It adds up to some mills cutting shifts and others shutting down.

“What sawmills are going to have to face now is how badly they want to continue to run,” says David Manke of Manke Lumber. “It’s not going to be profitable with the Chinese influence on raw materials.”

QE2 Winners and Losers: How the Fed’s Stimulus Maneuver Helped the Rich and Screwed the Poor

By Bethany McLean
Slate.com

“So here we are, just shy of a year later. If the Fed’s major goal was preventing deflation, then QE2 has succeeded (with the caveat that we don’t know what would have happened without QE2). One useful way to measure inflation, according to Nomura strategist Paul Sheard, is by the rate that the markets expect in five years. Bernanke said he was worried about any reading below 2 percent. The market-expected rate, which was down to 2.02 percent last August, has risen to 2.6 percent. Mission accomplished. Deflation was averted.

But there are some other things that happened during the past year:
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1) Stocks soared. From Bernanke’s speech through the end of June 2011, the Dow Jones Industrial Average increased almost 25 percent.

2) Speculative assets ranging from Chinese dotcoms to social networking start-ups went crazy.

3) Just as skeptics feared, commodities ranging from oil to silver to cotton to food have also seen dramatic increases in price. For instance, the Reuters/Jefferies CRB index, which is designed to track global commodities markets, is up more 25 percent since Bernanke announced QE2.”

——

(I know none of this is new news, but it is interesting to hear the truth spigot start to drip, drip, drip its way down the journalistic gutter…)

I don’t know if it has been mentioned but the latest Barron’s has an article predicting $150 oil by next year. Interestingly that was the same number and time frame that I predicted on this blog a few months ago. For those that still think oil, gold etc. are in a bubble, I thought of a new way to explain why they are not. It is impossible for something to be in a bubble when the PTB are trying to manipulate the price down. The Fed has indicated that there is “good” inflation and bad inflation. Good inflation is a rise in things like stocks and homes (some on this blog might disagree) and bad inflation is a rise in things like oil, gold and food. The government has no problem with the bubble in social media stocks which are priced for 50% growth for twenty years ( we will ignore what happened to Myspace and AOL). However, it constantly tries to drive down gold and oil. However, the markets are bigger than the the PTB and they just bounce up. If you play them like I do and cover your butt with covered calls on your shares from time to time, you can make the government’s tricks work for you.

We’re about to start house hunting and want to know how to avoid a neighborhood that may go downhill in a few years. We’re already avoiding new construction because we figure a neighborhood that is at least 10 years old will be more stable. Any areas with unkempt lawns, etc are also off the list.

Here are some possibilities:

1. Buy a house for $140-155k in a middle middle class neighborhood and hope that since the prices are lower, fewer people will face the possibility of future foreclosure and house abandonment.

2. Buy a $160-179k house in a middle-upper middle class neighborhood where many, or most of the houses cost about $200k. Does a nicer neighborhood mean the residents are likely to be more or less financially stable than the neighborhoods mentioned in option 1?

All of these houses are about 25-30 minutes from Raleigh itself. RTP is a little farther away.

Global ‘train wreck’ coming
Peter Martin ~ smh.au

THE global economy is facing ”a slow-motion train wreck” with Greece only the first nation to be hit, Reserve Bank director Warwick McKibbin has told a Melbourne conference.

Referring to the most recent global economic crisis as a mere ”blip”, he said the coming crisis could undo the mining boom and bring on inflation of the kind not seen since the 1970s.

Professor McKibbin told the Melbourne Institute conference dozens of European countries now had gross government debts on track to exceed 60 per cent of GDP. ”Japan is forecast to be 200 per cent of GDP, the US is forecast to be over 100 per cent of GDP,” he said.
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”At zero interest rates that can be sustained, but at 5 per cent interest rates countries have to put aside 5 per cent of their GDP every year just to service the debt. That is not sustainable.

”Already consumers aren’t spending and investors aren’t spending because of the tax increases that are in prospect.

”Greece, Portugal and Ireland don’t just need to have their debts written off, they need to have a 30 per cent to 40 per cent depreciation of their real exchange rate,” he told the conference.

”There are two ways to do that, either pull out of the euro and depreciate by 40 per cent, or have deflation of 40 per cent over the next 12 months.

”I do not believe any society can survive having a 40 per cent deflation that’s been imposed by the International Monetary Fund and the European Central Bank.”

As the US created more dollars to inflate away its debt repayment obligations, countries that are linked to the dollar, including China, India and parts of Latin America, would suffer 1970s-style inflation.

”In India inflation is 9 per cent, in China it is 6 per cent. That inflation is pushing up resource prices for now, but it will have to be brought under control with much higher interest rates,” he said.

DOW 13,000 on the way!

Calif. Moms Accused of Using PTA in Ponzi Scheme
Associated Press

LOS ANGELES – Three former PTA mothers used their connection with a suburban elementary school to recruit investors in a phony $14 million get-rich-quick scheme, authorities said Wednesday.

The alleged Ponzi-style scam lasted more than two years before an irate investor filed a complaint last year, sparking an investigation that led to the arrests Tuesday of three women, said Lt. Steve Katz of the Los Angeles County Sheriff’s Department.

The alleged swindle started in 2008 when the women told fellow PTA members they had the exclusive right to sell products from a well-known local dairy to Disneyland, Disney hotels and other small retailers.

They said they needed capital to expand the business and promised returns of up to 100 percent, adding that even if there was no profit, investors would get their money back, Katz said.

“It was billed as no way to lose,” he said.

Investments, which had to be made in cash, ranged from $5,000 to $208,000. The 40 investors dipped into their life savings, maxed out their credit cards and took out second mortgages on their homes to come up with the money, Katz said.

Maricela Barajas, 41, and Juliana Menefee, 50, both of Diamond Bar, were arrested on 22 felony charges, including grand theft and securities fraud. The third woman, Eva Perez, was already behind bars, serving a nearly 10-year sentence on grand theft charges related to a similar swindle in neighboring San Bernardino County.

Calls to the homes of Barajas and Menefee, who were being held on $500,000 bail, were not immediately returned. Their arraignment scheduled for Thursday was continued until Aug. 4.

The women belonged to the PTA at the Neil Armstrong Elementary School in Diamond Bar until school leaders became aware of the complaints and ended their membership, Katz said.

The fact that they were PTA members was key in leading the investors to trust the women and to recruit their own acquaintances as far away as Salt Lake City, he said.

School Principal Cynthia Sanchez did not return a phone call for comment Wednesday.

A spokeswoman for the Pomona Unified School District said the district was unaware of the investigation until the sheriff’s department announced the arrests. No PTA funds were involved in the fraud, Gabriela De La Cruz said.

Shortly after the scheme started, Perez was arrested in San Bernardino County on 28 charges of grand theft and one charge of writing a check on insufficient funds. In December 2010, she pleaded guilty to 10 of the charges and was sentenced to nine years and eight months in prison and ordered to pay $151,600 to 33 victims, according to court records.

Just got back from Lowe’s, huge mark downs. I am redoing a bath room, couldn’t stand looking at the 70’s anymore. The glass floor tile I had my eye on was down from $5.98 a sq.ft. to $1.99 but at the register it came up as .99 cents! Same with light fixtures, toilets, thin-set, grout etc. Anywhere from 40 to 70% off.

So this redo is costing a whole lot less than I had thought. I do all the labor so the total is going to be around $300.00 in materials and fixtures, not bad at all.

Also the slate I plan to use in a hallway is down from $3.89 a sq.ft. to $1.49.

Not many people were there shopping but they had an over abundance of sales folks running around.

Local Woman Envisions Mobile Breastfeeding Truck

PITTSBURGH (KDKA) — A local artist and teacher at Carnegie Mellon University has come up with an idea to support mothers who are harassed for nursing in public.

Jill Miller envisions something she calls “The Milk Truck.” She wants to buy an ice cream truck and outfit it with a giant breast on the roof.

When a woman is made to feel uncomfortable or told to leave a public place for breastfeeding, she could contact “The Milk Truck.” The truck would respond and park in front of the restaurant or other establishment, along with followers of the program through Twitter and Facebook.

Project manager Tara McElfresh says they will lay down a rug, set up chairs under an awning on the side of the truck, and if the mother still needs to, she can nurse outside in an environment of support.

McElfresh says she’s heard stories of women who have encountered problems breastfeeding in public in Pittsburgh, including a woman who says she was told to leave a restaurant in Squirrel Hill.

Miller is trying to raise $10,000 to make the project a reality through pledges at a site called Kickstarter.com. She’s already raised $4,300 and gotten responses from around the world.

Once completed, the truck is scheduled to be part of an exhibit starting in September at the Andy Warhol Museum.

McElfresh says the truck will also make appearances at events.

Miller says the truck is supposed to be an attention-grabber when it responds to a call for help.

“Thought the nursing mother created a spectacle? Meet ‘The Milk Truck!’” she said.

Realtors Are Liars

An interesting story I saw yesterday regarding Japan’s salarymen:

http://www.businessweek.com/magazine/japans-salarymen-learn-to-save-06302011.html

Apparently household savings in Japan are down and salarymen are having to cut back. They too are enjoying the wonders of stagnant wages and a rising cost of living.

Boil, boil, toil & trouble…”MUrDoch’s “True Chupacabra™”

“…The scandal is taking a toll on News Corp., with stock prices falling and new questions about Mr. Murdoch’s proposed $12 billion takeover of the pay-television company British Sky Broadcasting. Many legislators criticized the deal on Wednesday,…”

heheeeheeeheehaahaaahaaheeehaahaaa… (Hwy50™)

Murdoch to Close Tabloid Amid Fury Over Hacking:
By SARAH LYALL and ALAN COWELL /Published: July 7, 2011

Prime Minister David Cameron, whose Conservative Party benefits from Mr. Murdoch’s support, has not yet called for an immediate investigation into behavior by The News of the World and other tabloids. Such an inquiry would have to wait, he said, until the police had concluded their own criminal investigation.

The two men, private investigators named Jonathan Rees and Sid Fillery, were suspected of murdering their former partner, Daniel Morgan, who had been killed 15 years earlier. Their targeting of Mr. Cook included following him, his wife, and their children, trying to access his and his wife’s voice mail and obtaining personal details about him from police databases.

Does anyone besides me find Zestimates to appear upwardly biased during a period of falling prices? Here is an example: This home shows up in our local paper (Rancho Bernardo & 4S Ranch News Journal) with a Notice of Trustee’s Sale; seems the current owner is in default to the tune of $969,229.00.

Something about these Zestimates™ doesn’t smell right.

15636 Oakstand Rd
Poway, CA 92064
For Sale: $995,000
Zestimate®: $949,000
Mortgage payment:
$5,132/mo
Bedrooms: 4
Bathrooms: 3.5
Sqft: 3,450
Lot size: 43,560 sq ft / 1.00 acres
Property type: Single Family
Year built: 1989
Days on Zillow: 167
Last sold: July 07 2008
MLS number: 110003968

RECENT COMPS:

15460 Willow Ranch Trl, Poway, CA 92064
Sold on 05/31/2011: $813,000
Beds: 4
Sqft: 2904
Built: 1989
Baths: 3.0
Lot: 52272

15327 Ridgeview Pl, Poway, CA 92064
Sold on 03/15/2011: $875,000
Beds: 4
Sqft: 3527
Built: 1987
Baths: 3.0
Lot: 43995

13961 Umbria Way, Poway, CA 92064
Sold on 03/14/2011: $830,000
Beds: 5
Sqft: 3455
Built: 1999
Baths: 3.0
Lot: 46609

Consumers doing their job…

Jobs reports push stocks higher; Retailers rise
Stocks rise after claims for unemployment benefits dip and private hiring picks up

NEW YORK (AP) — Better news on jobs drove stocks higher Thursday. Target, Gap and other large retailers jumped after reporting stronger sales.

The government reported that the number of people who made first-time claims for unemployment benefits dropped to 418,000 last week, the lowest level in seven weeks. That’s a sign that employers are laying off fewer workers.

Separately, payroll processor Automatic Data Processing said companies added 157,000 employees in June. The bulk of the hiring came from small businesses. The tally is more than double the number economists had forecast and far more than the 36,000 added the previous month.

Warm weather and deep discounts resulted in the best June sales figures for U.S. retailers since 1999. Kohl’s Corp. rose 6.6 percent, the most of any stock in the S&P 500 index. Target Corp. was close behind with a gain of 6.4 percent. Both reported strong sales for June.

Investors have been concerned that high gas prices would constrain consumer spending as people made fewer shopping trips and looked for ways to save money. The higher sales figures reassured markets that consumers were becoming more willing to spend again.

“The closest thing to an unadulterated barometer of our progress is same-store sales,” said Jack Ablin, chief investment officer at Harris Private Bank in Chicago “Everything is tied to it: Sales drives profits, profits drive hiring and hiring drives sales. It’s a neat, virtuous circle.”

The Cost Of Owning 150,000 Foreclosed Homes

When you are the nation’s largest owner of foreclosed homes, even little things can get expensive fast. Such is the case for mortgage giant Fannie Mae, which as of March 31 had a mind-boggling 153,000 foreclosed homes on its books.

One example — mowing the lawn. Two men swoop in on a foreclosed town house in Lanham, Md., quickly mowing and edging the small front yard. Fannie Mae owns this home, so it’s paying for the lawn crew to come every two weeks or so to keep up the curb appeal.
http://www.npr.org/2011/07/07/137647997/the-cost-of-owning-150-000-foreclosed-homes

I’m back! Was visiting relatives, who have finally stopped telling us we are missing out by not buying a house now.

An update on the lot we’re trying to buy…

Apparently the bank that owned the note failed, so the FDIC gave its assets to another bank. That (recipient) bank seems open to a deal but the FDIC has a say and isn’t budging (sounds like they’re backstopping the losses). They claim to have an appraisal that shows the lot is worth 14% higher than the identically-sized adjacent lot went for this past January. We’ve asked for a copy of the appraisal, both to determine how old it is and what comps were actually used. Another larger lot (not in the neighborhood, but not far away) very recently went under contract after asking 10% below that neighboring lot.

So we made a counter, listed the newer comps the appraisal would compare to if it were to be done “today” (or in the future for that matter), and argued that one can’t find a better comp than an identically-sized, similarly-featured adjoining lot. Either they listen or they don’t, but we’ve laid out our “best and final” and I’ll keep the HBB posted.

As I said before, I’m not entirely hot on the idea of building, so I could take it or leave it.

Job$! Job$! Job$!…the “TrueCorp.Inc.Exodu$toLow-WageState$™” is on $chedule and “un$topable!”

Reduce Corporate Inc. taxe$ Now! Hurry, it pain$ them,..they’re $uffering $o!

To $peed this inevitable Corporate Inc. Freight Train on down the tracks:

(Hwy suggests that all Corporation Inc.’$ be given free buildings/facilities paid by State/County/City tax money + the ability to pay all workers $7.50 hourly with 50% employee paid crap-health-insurance + have every worker after 5 years of meaningle$$ cpi salary raises, cross-train their replacements. Oh, and to ease the Inc.’$ Agonie$, give them a 15 year $0.00 tax holiday.)

I know this is really a radical propo$ition. I have no clue where these whacked-out idea$ take root. Moreover, the Inc.$ still would find $omething to cry-pi$$-&-moan about regarding their oppressed “bidnesse$”

“These are significant increases, but the job-cut totals are still low enough to prevent alarm bells from sounding,” said John A. Challenger, chief executive of the outplacement firm. “However, the fact that job cuts are rising in these particular industries is notable, since aerospace, financial services and industrial goods are all bellwether industries when it comes to the overall health of the economy.”

“While the government attempts to enact policies that will spur job creation, it really comes down to consumer and business demand for products and services and, right now, that demand remains relatively weak,” he said.

U.S. aerospace layoffs more than triple:
July 7th, 2011, by Mary Ann Milbourn / OC Register

Besides aerospace, dark clouds still hang over the financial services sector, which increased downsizing by 18.5% to 11,734, up from 9,901 in the first six months of 2010. Job cuts in the industrial goods sector are approaching 11,000, 28% higher than a year ago.

The downsizing, prompted by cutbacks in defense and government contracts, jumped from 6,121 in the first six months of 2010 to 20,851 this year, based on planned layoffs announced by major employers.

Orange County has seen its share of layoffs as a result of the aerospace restructuring.

The Boeing Co. announced in June that 100 space shuttle workers in Huntington Beach will be out of jobs Aug. 5, assuming the last shuttle mission, scheduled to launch Friday, gets off as planned.

Up to 160 jobs at Boeing’s A160T helicopter plant in Irvine are being transferred or eliminated this year with the work being consolidated at the company’s Mesa, Ariz. facility.

Those cuts were in addition to the nearly 1,000 local Boeing jobs eliminated last year and don’t include layoffs by suppliers, vendors and other smaller companies that don’t announce their downsizings or closures.

Although Boeing is cutting on the defense and government side, spokeswoman Paula Shawa said the company expects to add workers company wide this year because of demand for its commercial aircraft. Those jobs, however, will be in Washington and South Carolina, not in California.

Who i$ it that’s wants to…reduce…the Pain$ & Agonie$ for MegaCorporation Inc’s? Who is Yelling/$creaming/Hollering for eliminating the $7.50 minimum peon-worker hourly wages? Who is promoting to all Americans the “TruePathtoWealthie$PersonalPro$perity™” Who?

The latest revelation in this story is that Goldenman$achs Inc., enemy of the common man and vampire squid atop a cowering nation, imbibed itself on a $15 billion life line - the single biggest gulp of them all — and of course, courtesy of Saint Omo, the Fed and therefore, us taxpayers.

Goldman Sachs Got a $15B Loan and All I Got Was This Lousy T-Shirt:
By Matt Nesto / Yahoo| Breakout

Saint Omo stands for the far less fun Short Term Open Market Operations, which was a lending entity dreamed up in the throws of the financial crisis, when Hank Paulson, Tim Geithner, and Ben Bernanke were secretly bailing out a fleet of sinking ships as fast as they possibly could, and in ways and amounts never seen before.

So any guesses where this family made their 1st mi$take?

Family fights government over rare ‘Double Eagle’ gold coins:
By Zachary Roth | The Lookout

The rare coins, first struck in 1850, show a flying eagle on one side and a figure representing liberty on the other. One such coin recently sold at auction for $7.6 million, meaning the Langbords’ trove could be worth as much as $80 million.

Some coin disputes involve more than wrangling over valuable collectors’ items. In 2007, Secret Service and FBI agents raided an Indiana company called Liberty Dollar, in a bid to stamp out illegal currency. The firm was making “Ron Paul Silver Dollars,” in honor of Rep. Ron Paul, whose presidential campaign advocates bringing back the gold standard.

Yo gubmint at work…

Gov’t to ease foreclosure rules for unemployed
Government will let unemployed homeowners with FHA-backed loans miss payments for a full year.

WASHINGTON (AP) — The Obama administration is making it easier for out-of-work homeowners to stay in their homes, as it tries to revamp its troubled foreclosure-prevention program.

Starting Aug. 1, the Federal Housing Administration will extend the period for unemployed homeowners to miss mortgage payments to a full year from three or four months. That will allow qualified homeowners to go without making a monthly payment for 12 months before the foreclosure process begins.

The extended grace period only applies to FHA-backed loans, which are usually given to low- and middle-income borrowers and represent about 14 percent of all active mortgages and roughly 25 percent of new mortgages, and homeowners in the government’s foreclosure-prevention program. About 10,000 homeowners in the foreclosure program and 3,500 FHA-backed homeowners per month would be eligible, officials said.

Housing and Urban Development Secretary Shaun Donovan said Thursday that administration officials hope private lenders and government-controlled mortgage giants Fannie Mae and Freddie Mac, which back 90 percent of all new mortgages, will adopt a similar policy.

“Our hope is that this will have broader effects,” Donovan said during a conference call.

From abc news linked off google news main page:

America Keeps Getting Fatter

A new report from Trust for America’s Health found that not one state has reported a decrease in obesity. In fact, adult obesity rates have increased in 16 states in the past year.

Twenty years ago, no state had an obesity rate higher than 15 percent. Now, only Colorado is below 20 percent.

In other words, Colorado, which today is the state with the lowest obesity rate :) would have had the highest in 1995.

Southern states have the highest rate of obesity, and Mississippi tops the nation’s list as largest state, where 34 percent of the population is obese.

Really? enjoy!:

Posted in: Meltdown • Odds & ends • Really / OC Register
Real estate news and views from around the globe that make you go, “Really?”

* THE GREATER DEPRESSION: The housing crisis that began in 2006 is now worse than the Great Depression. Prices have fallen some 33%, greater than the 31% fall from the late 1920s to the early 1930s, according to Case-Shiller data. (CNBC)

* MEGLOMANIA: Berkshire Hathaway Vice Chairman Charles Munger told a conference in Pasadena that the housing bubble “was caused by some combination of megalomania, insanity and evil.” (Huffington Post)

* BID RIGGING: Federal prosecutors allege that eight real estate investors conspired not to bid against one another at foreclosure auctions in two Northern California counties. (Forbes)

* $181 BILLION: The volume of distressed commercial real estate totaled $181.1 billion in June, up $500 million since April, according to Delta Associates and Real Capital Analytics. (GlobeSt.com)

* WORST DEAL EVER: Bank of America’s decision to buy Countrywide home loans “turned out to be the worst deal we ever made,” one Bank of America director told the Wall Street Journal. (Huffington Post)

* AT LONG LAST, THE BOTTOM: “I therefore declare: real estate has bottomed,” writes blogger Markos Kaminis. (Seeking Alpha)

Jailed for cashing Chase check at Chase bank
KING 5 News

AUBURN, Wash. - Buying his own home was a big accomplishment for construction worker, Ikenna Njoku, of Auburn. He’s only 28 years old.
“I was really excited. For the first time, I actually got to buy a lawn mower, mow my lawn and everything,” said Njoku.

Njoku qualified for the first time home buyer rebate on his tax return.

“It was really important, I had a vehicle I was looking on paying off,” said. Njoku. And it wasn’t just any vehicle. “It was a 2001 Infinity I-30, silver…just like my favorite car, “he said.

Njoku signed up to have the rebate deposited directly into his Chase Bank account. But when the IRS rebate arrived, there was a problem. Chase had closed Njoku’s account because of overdrawn checks in the past. The bank deducted $600 to cover what he owed them and mailed him a cashier’s check for the difference–$8,463.21.

But when Njoku showed up at the Chase branch near his house intending to cash the check, he was in for a nasty surprise.

The check had Njoku’s name and address on it and was issued by JP Morgan Chase. But the Chase Customer Banker who handles large checks at the Auburn branch was immediately suspicious.

“I was embarrassed,” Njoku said. “She asked me what I did for a living. Asked me where I got the check from, looked me up and down—like ‘you just bought a house in Auburn, really?’ She didn’t believe that,” he said.

The Customer Banker said the check looked fake, so she took it, along with Njoku’s driver license and credit card, and called Bank Support.

After waiting for about 15 minutes, Njoku said he got impatient and told Chase he was leaving to do an important errand. By the time he got back, the bank was closed. Njoku said he called customer service and asked them what he should do. He says they told him to go back to the bank the next day to get his money.

But when Njoku arrived, it wasn’t the money that was waiting for him.

“They just threw me in jail; they called the police and said this guy has a fraudulent check,” Njoku said.

Auburn police arrested him for forgery - a felony crime.

“I was like - you’re making a mistake, you’re making a mistake, don’t take me to jail, I got work tomorrow. I can’t afford to miss work,” he said.

Njoku was taken to jail on June 24, 2010, which was a Thursday. The next day, Chase Special Investigations, realized it was a mistake. The check was legitimate. The Investigator called Auburn Police and left a message with the detective handling the case, but it was her day off. So Njoku stayed in jail for the entire weekend. Finally, on Monday, he was released.

Auburn Police Commander Dave Colglazier said Chase could have done a lot more to let them know they’d locked up an innocent man.

“We do have a main line that comes into our front office,” he said. “There are ways to reach someone 24/7 at a police department.”

For Njoku, going to jail for five days meant a lot more than just losing his freedom. He said the entire time he was “just stressed out…trying to figure out what was going on with my vehicle. I love my vehicle,” he said.

Njoku’s car had been towed from the bank parking lot and his check seized as evidence.

“I had to wait a couple of weeks,” he said, “and my car got sold, auctioned off.”

Njoku says he didn’t have the money to pay the impound fees and fines to get his car back before it was sold. He said he also lost his job because he didn’t show up for work while he was in jail.

After all of that, Njoku said he never heard a word from Chase.

“They haven’t even sent me a letter or apologized,” he said. “It’s been a year we’ve been trying to contact these guys.”

Finally, A Seattle attorney offered to help. Last week, Felix Luna sent Chase a scathing letter. Read the attorneys’ letter to Chase

“It’s one thing to make a mistake,” Luna said. “It’s one thing to make multiple errors of judgment like Chase has made and then, once you realize that your error has caused such harm to somebody else, to just ignore it for a year. I think he deserved better. I think all their customers do.”

Like Njoku, KING 5 had a difficult time getting answers from Chase. A week after first contacting them, they sent a two line e-mail.

“We received the letter and are reviewing the situation. We’ll be reaching out to the customer,” wrote Darcy Donoahoe-Wilmot, from Chase Media Relations.

Njoku said that even after he got out of jail, he said was confused and upset. “For a month, two months, I was just down and depressed,” he said.

He’s still happy he bought his house, but sad that his experience with his own bank was so humiliating.

“They treated me like a criminal,” he said.

This is fun stuff, it will blow right over the heads of the average and not so average American voters…

~ Clipped from The 5Min Forecast

On the national level, President Obama announced yesterday he’s ready to put Social Security on the chopping block if his political foes will agree to start raising taxes.

Rather, he’s open to changing the standard by which cost-of-living adjustments (COLA) are calculated.

You might call it a “stealth default.”

The Greenspan Commission first recommended monkeying with the consumer price index (CPI) in 1983 so inflation would appear to be less severe than it is and the SS Trust Fund would not have to pay increases according to recipients’ needs, but rather a formula calculated in the backroom of some marble and glass structure on K Street.

This time around, policy wonks want to up the ante. The COLAs they propose should be calculated by a measure called “chained CPI.” The reason? To reflect a favorite among academic economists: the “substitution effect” — that is, when steak prices go up, you buy more hamburger, and thus the price you pay for beef remains stable. It’s only your standard of living that goes down.

If you’ve had money taken out of your pay for years to fund Social Security payments for others, you might conclude the “chained CPI” is nothing but a broken promise. We couldn’t fault you for feeling that way.

Let’s get out the napkin. Between the Social Security changes, spending cuts and tax increases on the table, The Washington Post says the savings proposed will total $4 trillion over the next 10 years.

That’s an average of $400 billion a year. This year’s deficit is $1.65 trillion. Hmmn…

Like standing at the edge of a cliff in Canyonlands, at night, with the moon behind the clouds, we’re sensing a vast emptiness. Wait, that’s a $1.2 trillion yaw in the annual budget — even if these politically unsafe proposals get passed without the grubby hands of political staffers all over them.

Thank the Lord, our creditors have problems enough of their own to contend with. Even so, the Chinese, the Japanese and the Middle Eastern oil sheikdoms are most assuredly watching developments in Washington very carefully. At some point, they’re likely to conclude they won’t get paid in full… or as with “chained CPI,” what they get paid back with will amount to a “stealth default.”

“It has become alarmingly clear that public disclosure was the last thing on the minds of the government officials charged with protecting the taxpayers’ interests,” said Rep. Darrell Issa, the ranking Republican member on the House Oversight Committee.

Free government workshop for troubled homeowners Monday in Hollywood

By Jeff Ostrowski Palm Beach Post Staff Writer
Posted: 11:50 a.m. Thursday, July 7, 2011

A free Help for Homeowners workshop is scheduled for 11 a.m. to 7:30 p.m. Monday at the Westin Diplomat Resort in Hollywood, 3555 S. Ocean Drive.

The event is sponsored by the Obama Administration’s Making Home Affordable Program, HOPE NOW Alliance and NeighborWorks America. Troubled borrowers can meet with mortgage companies and federally approved counseling agents to work on a solution to help them stay in their home.

For more information, go to http://www.MakingHomeAffordable.gov.

http://www.palmbeachpost.com/money/foreclosures/free-government-workshop-for-troubled-homeowners-monday-in-1589073.html - -

This is good for an HBB chuckle or two:

http realestate aol.com/blog/2011/07/06/homebuyers-take-note-mortgage-elevator-is-going-up/?icid=main%7Chtmlws-main-n%7Cdl11%7Csec3_lnk2%7C218172

Homebuyers Take Note: Mortgage Elevator Is Going Up

“Consider this the “snap out of it” slap that Cher gave Nic Cage in “Moonstruck.” If you’re in the market for a house, you need to buy it while the interest rates are low — and by the way, those rates crept up a bit already this week.”

Looks like curtains for this waste of skin…

Court won’t stop execution of Mexican

HUNTSVILLE, Texas (AP) — The U.S. Supreme Court Thursday rejected a White House-backed appeal seeking to spare a Mexican citizen from execution Thursday evening in a death penalty case where Texas justice clashed with international treaty rights.

Justices voted 5-4, refusing to keep Humberto Leal from lethal injection, The decision came about an hour before Leal could be taken to the Texas death chamber for the 1994 rape-slaying of a 16-year-old girl.

The Obama administration and others asked the high court to delay Leal’s execution so Congress could consider a law that would require court reviews in cases where condemned foreign nationals did not receive help from their consulates. They said the case could affect not only foreigners in the U.S. but Americans detained in other countries.

Prosecutors, however, said the legislation was likely to fail and that Leal’s appeals were simply an attempt to evade justice for a gruesome murder.

Leal, a 38-year-old mechanic, was sentenced to lethal injection for the murder of Adria Sauceda, whose brutalized nude body was found hours after Leal left a San Antonio street party with her. The girl’s head was bashed with a 30- to 40-pound chunk of asphalt.

Leal moved with his family from Monterrey, Mexico, to the U.S. as a toddler. His appeals contended police never told him he could seek legal assistance from the Mexican government under an international treaty, and that such assistance would have helped his defense.

The argument is not new. Texas, the nation’s most active death penalty state, has executed other condemned foreign nationals who raised similar challenges, most recently in 2008.

http://www.dailytech.com/Ford+and+Toyota+Blast+EPA+for+Forcing+Ethanol+Blends+on+Public/article22077.htm

Ford and Toyota blast the EPA for forcing 15% ethanol on the public. The sheeple might start taking a much more active interest in ending this scam on consumers and taxpayers when they ruin their engines and learn the use of such high concentrations of ethanol invalidates their warranties.

Picked up a case of Oak Leaf Shiraz from WalMart. $2.77/bottle.
Decent stuff. Kinda like the Mad Dog of the vino world.

Ahem, sir, that is a sipping wine.

My bad! Do you have any gulping wines!?

It`s my equity, and I need it now!