July 28, 2011

Bits Bucket for July 28, 2011

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Comment by Professor Bear
2011-07-28 00:43:04

America’s Credibility Is at Risk
Published: July 27, 2011

Until this week, Wall Street has shrugged off each new low in the debt-limit debate, confident — in a whistling-past-the-graveyard kind of way — that Washington would raise the debt limit on time.

Many Republican politicians have insisted that the economy and the country could shrug off a default. Up to Wednesday, the most conservative members of the House seemed to be welcoming a default. They refused to support a plan to raise the limit — and impose overly harsh spending cuts — put forward by Speaker John Boehner.

The cost of this fecklessness should now be clear to everyone. The Dow Jones industrial average dropped nearly 200 points on Wednesday and is down 421 points since Friday when Mr. Boehner left President Obama waiting for a phone call that never came about a deal that never closed.

With bond-rating agencies issuing dire warnings, investors have begun to demand higher rates on Treasury bills that come due in August. Prices have surged on credit default swaps, which are used by investors to protect against default and by speculators to bet on the likelihood of default.

Comment by combotechie
2011-07-28 04:41:11

We are being played.

Comment by Left Ohio
2011-07-28 05:11:01

America isn’t a country, it’s a game.

Comment by liz pendens
2011-07-28 06:25:31

A game with a rulebook that morphs constantly to favor the winners.

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Comment by Xenos
2011-07-28 06:36:40


Comment by ecofeco
2011-07-28 12:37:09


Comment by Left Ohio
2011-07-28 07:15:28

What’s the score in this ‘game’?

From USA Today: Exxon 2nd quarter earnings rise 41%

The largest publicly traded oil company reported earnings of $10.68 billion, or $2.18 per share, for the three months ended June 30. Revenue grew 36% to $125.5 billion.

From boston DOT com: Ranks of hungry children swell, worrying doctors

Doctors at a major Boston hospital report they are seeing more hungry and dangerously thin young children in the emergency room than at any time in more than a decade of surveying families. Pediatricians at hospitals in four other cities - Baltimore; Little Rock, Ark.; Minneapolis; and Philadelphia - also reported increases in the ranks of malnourished, hungry youngsters in their emergency rooms since 2008.

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Comment by In Colorado
2011-07-28 08:08:42

God Bless Exxon! God Bless America! The land of the hungry and home of the serfs.

Comment by oxide
2011-07-28 08:16:37

Right after the stories on starving kids in Somalia, they should show a story on the starving kids in major cities. It will probably spark some nice comments about welfare queen moms on crack.

Comment by liz pendens
2011-07-28 08:32:28


Corrupt paid-for government 1
Democracy 0

Comment by Arizona Slim
2011-07-28 09:01:05

Doctors at a major Boston hospital report they are seeing more hungry and dangerously thin young children in the emergency room than at any time in more than a decade of surveying families.

Let me guess: These kids probably don’t have insurance. And the reason that they don’t have it is because their families can’t afford it.

Meanwhile, health insurance company profits are soaring.

Comment by measton
2011-07-28 09:19:21

If there was just some way we could give Exxon more tax breaks so that the gov paid Exxon money we would see the benefits trickle down to the rest of us.

In related news GS is in the metal storage business and keeping aluminum off the market.

Comment by drumminj
2011-07-28 09:27:52

Meanwhile, health insurance company profits are soaring.

Explain why these should be considered together (I can guess, but want to understand).

Yes, there are uninsured people because insurance costs money. And yes, costs have gone up.

But are you arguing the insurance companies shouldn’t be making profits?

Comment by In Colorado
2011-07-28 09:40:06

“But are you arguing the insurance companies shouldn’t be making profits?”

Maybe our healthcare system shouldn’t be “for profit” to begin with, like it pretty much is in every other civilized country in the world.

Sometimes I get discouraged living in Fereginar.

Comment by In Colorado
2011-07-28 09:44:41

Doctors at a major Boston hospital report they are seeing more hungry and dangerously thin young children in the emergency room than at any time in more than a decade of surveying families.

Why don’t their families just go out and buy steak and lobster with their $400/month SNAP allowance? We know that they all drive Escalades and have iPhones.

Comment by Carl Morris
2011-07-28 09:58:45

But are you arguing the insurance companies shouldn’t be making profits?

I would argue that because in many ways the interests of the insurance company are directly opposed to the interests of the public (the insurance company interest is best served by not paying claims after promising coverage) and I’m not seeing a good free market solution, we as a country would be best served by making health care a regulated utility similar to power.

Comment by drumminj
2011-07-28 09:58:58

Maybe our healthcare system shouldn’t be “for profit” to begin with

Perhaps, but it seems to me that’s a separate discussion.

Right now, healthcare is not government run. As such, shouldn’t the companies be allowed to turn a profit? And to not have it capped artificially?

Comment by drumminj
2011-07-28 10:00:54

we as a country would be best served by making health care a regulated utility similar to power.

I’m not going to argue that point. But currently they’re not, correct? So given that, they’re free to make profits so long as they’re obeying the law and regulations, aren’t they?

Personally, I’m not a fan of regulated utilities, or gov’t-sponsored monopolies in any way as in the end we just get screwed as a result.

Comment by Carl Morris
2011-07-28 10:15:09

Personally, I’m not a fan of regulated utilities, or gov’t-sponsored monopolies in any way as in the end we just get screwed as a result.

I hear you, but it appears we get screwed even worse by the market in cases such as this. How do you prevent Enron without government interference? They packed a century worth of government screwing into just a few short years. Insurance companies aren’t much better, but they screw individuals rather than whole states so you don’t hear as much about it. They’ve managed to avoid overplaying their hand Enron-style so far…but that doesn’t mean they’re not screwing people.

Comment by aNYCdj
2011-07-28 10:58:30

Meth headz dunt hav no monee 4 da kidz ever see a fat kid in a meth house?

story on the starving kids in major cities. It will probably spark some nice comments about welfare queen moms on crack.

Comment by oxide
2011-07-28 13:47:51

Rio: we as a country would be best served by making health care a regulated utility similar to power.

drumminj: I’m not going to argue that point.

Of course you’re not going to argue that point. Because the last time you argued it, you lost. Big time.

Comment by RioAmericanInBrasil
2011-07-28 13:56:55

Rio: we as a country would be best served by making health care a regulated utility similar to power.

That was Carl Morris who said that today.

But for a second there I thought it was me. :)

Comment by ahansen
2011-07-28 17:41:04

Would someone please tell me what business the insurance industry has in the public health sector in the first place?

It’s like having the USDA oversee car mechanics.

Comment by cactus
2011-07-28 18:13:25

So my wife’s doing a report on SS. I found this stuff seems title2 ss “disability and survivors beneifits” really has some crazy abuse. http://www.justice.gov/usao/eousa/foia_reading_room/usab5206.pdf

Jack Baybee and his grandmother, Granny,
live together in a house rented from HUD. Granny
is eighty-four years old and suffers from diabetes
and advanced cataracts. Granny is unable to walk
without substantial aid and is legally blind.
Baybee is Granny’s representative payee for her
Title II Survivor’s benefits. Baybee pays Granny’s
bills, takes care of the house, monitors G ranny’s
medical bills, and takes Granny to church twice
each Sunday. Granny died in 1992. However,
Baybee, despite his obligation as a representative
payee to report Granny’s death, failed to do so.
Instead, Baybee continued to receive Granny’s
Title II Survivor’s benefits each month and use
them for gambling, drugs, and rock-n-roll. Baybee
continued to make annual reports to SSA detailing
his fictitious administration of dead Granny’s
Suzie Gurl is a self-described crack queen,
who lives in a week-to-week motel and has a livein
biker boyfriend who keeps her drug habit well
stocked. Gurl has three children under the age of
twelve, and one minor child aged sixteen, all of
whom have been adjudged as learning disabled,
and each of whom has received Title XVI SSI and
Title II Survivor’s benefits for more than four
years. The three children under age twelve were
removed from Gurl’s custody by State Children’s
Services for neglect and placed with foster
families, and the sixteen-year-old has been
incarcerated in a state juvenile facility for three
years for sexually abusing his younger siblings.
Despite her obligation as a representative payee to
do so, Gurl did not notify SSA that her three
youngest kids were removed from her care or that the sixteen-year-old had been incarcerated.
Instead, Gurl kept quiet and continued to receive
SSI and Survivor’s benefits payments, which she
used to buy drugs.

Johnny B. Baad (JB), age sixteen, collects
Title XVI SSI benefits based on a learning
disability and receives Title II Survivor’s benefits
based on the SSA account of his deceased father,
Daddy Sugar. Mae Sugar, JB’s mom, has been
JB’s representative payee since he first began
receiving SSA Survivor’s benefits when he was
twelve months old. Mae Sugar lied to SSA when
she applied for JB’s Survivor’s benefits after the
death of Daddy Sugar. JB was not the son of
Daddy Sugar, a fact known to Mae and Daddy
Sugar, before his death. Mae conceived JB during
a two year period just before Daddy’s death, when
Mae and Daddy were separated. Daddy never
acknowledged JB as his child, and had gone so far
as to get a blood test just before his death in order
to put his affairs in order and to confirm that he
was not JB’s father. After Daddy’s death, Sugar
applied for benefits, claiming that JB was Daddy’s
son. JB received Survivor’s benefits based on
Daddy Sugar’s account for twelve years before
Mae’s current boyfriend spilled the beans and
notified SSA of the fraud.

Comment by GH
2011-07-28 21:26:53

I have mixed feelings about health care. UK just announced it is cutting some 70% of surgery’s in certain categories such as hip replacements, tonsils etc. I am half English and had my teeth butchered as a teen. My sisters complain about long waits (sometimes years) for basic needs. My mother who was “supposed” to be tested each year for Cancer after breast surgery a few years before was not being tested at all it turns out… too late!

That said… Today having gone off on my own, I no longer carry health insurance. I simply cannot afford what it costs being close to 50 and do without. I am healthy and currently do not have any problems, but would hate to be hit by a bad driver on the freeway. I assume I would be left on the side of the road to die or taken directly to the morgue where the press would later report “I unexpectantly awoke”

I guess what I would like to see is the right to go to Costco and buy the SAME coverage they give their employees with a choice for a high deductible plan (One that WOULD have to be honored) and not one that their lawyers could do some digging and find out I smoked as a teen on and off…

Bottom line Insurance provides the deep pockets the health care racket needs to raise their prices on. Everyone should have some skin in the game when it comes to the cost, and I doubt I will like ObamaCare at all!

Comment by michael
2011-07-28 04:43:58

not sure i like the possiblity of the debt limit not being raised…but i sure as hell like the results…so far.

Comment by Jojo
2011-07-28 05:52:18

I can’t believe how racist Obama is being. Refusing to accept the Republican proposals just because they come from white guys.

Comment by Montana
2011-07-28 05:57:21

I don’t know the game being played, but have come to th conclusion that the gop can’t play it like they think they can, if there is a dem president. Too bad they didn’t do more with a rep president…but whoever prevails, they will lose the PR war like in 1995.

Comment by Jim A
2011-07-28 06:46:35

To a very real extant, the goal is to destroy the economy if you don’t control the White House. This isn’t just the GOP, both parties engage in this sort of scorched earth policy.

Comment by butters
2011-07-28 07:01:49

I think GOP can. It’s not 95 anymore. New games, new rules but they will fold at the last minute.

Like you I was thinking the same thing. Dems are weak period. Weak at opposition, weak at governing. Generally weak at everything. Pathetic bunch.

And GOP has shown that it can’t govern, it’s suicidal and spends resources chasing wrong priorities, but I think it plays the role of an opposition well. Granted most of the opposition comes from the dislike of anybody with D attached to their names, but still somwwhat effective. Dems should learn something from it for the next time around while growing some meatballs.

Comment by Professor Bear
2011-07-28 07:35:38

“…it plays the role of an opposition well.”

The jury is out on that one; wait and see whether the apple cart gets tipped over or even destroyed in this game of Debt Ceiling Chicken before deciding how effective the opposition turned out.

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Comment by scdave
2011-07-28 08:08:34

while growing some meatballs ??

What’s worse….Having no meatballs or acting like you have big meatballs when in reality there are none ?? (See Bush II)…..

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Comment by Arizona Slim
2011-07-28 09:02:19

while growing some meatballs ??

Hey, watch it there, buddy! You just insulted meatballs!

Comment by In Colorado
2011-07-28 08:34:20

And GOP has shown that it can’t govern

And neither can the Dems, unfortunately.

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Comment by butters
2011-07-28 14:55:00

Preserving the status-quo seems to be the #1 priority no matter who wins election…..

Comment by liz pendens
2011-07-28 09:24:25

Does anybody else get the impression that a failure to raise the debt ceiling would not even be noticible to any of us? It would merely make it much harder for the megabanks to continue their scam of “profits” by throwing a huge wrench in the interest rate equations their whole scam is based on. I say let it happen.

Comment by Arizona Slim
2011-07-28 09:46:54

Does anybody else get the impression that a failure to raise the debt ceiling would not even be noticible to any of us?

In my comings and goings around town, I have yet to meet anyone who gives a fig about the debt ceiling.

Big topic of local conversation: When’s it gonna rain again? We need rain, dammit!

Comment by Jim A.
2011-07-28 09:47:52

How many people around here collect Social Security? Because some people would have difficulty if their check was delayed for several days until the treasury had enough money to pay them. Many tea party conservatives seem to view debt limit driven default as a way to force the current administration to make painful cuts without congress having to vote for them. To counter this, the administrations position seems to be that they have no legal authority to pick and choose and so will simply pay bills (late) in the order that they arrive whenever sufficient cash is available. So if there isn’t enough money on Aug 3rd to pay SS benefits, people will just have to wait until the government gets enough money to cover them. After all the bills from Aug 3rd are paid, they’ll start on the bills from Aug 4th.

Comment by liz pendens
2011-07-28 10:16:33

Late checks, big deal. You can always riot…

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Comment by wmbz
2011-07-28 02:50:45

Still dreaming of a housing “recovery”.

Vacant Homes Will Drown Housing Recovery
By: Diana Olick CNBC Real Estate Reporter

A real estate source I knew recently told me about a guy he knows in Atlanta who has been hired by several different banks to winterize their REO’s (real estate owned, i.e. the bank-owned foreclosures).

The homes are abandoned and empty, and clearly the banks think they’re going to stay that way for a while.

The winterizer didn’t want to do an interview, for fear he would lose his clients, the banks, who might not want us all to know about this.

A new study by an economist at the Cleveland Federal Reserve finds today’s foreclosures stay vacant far longer than the historical norm. Studying one Ohio county, Stephan Whitaker found, “foreclosed homes go through more than a year of very high vacancy rates following the auction and are substantially more likely to be vacant up to 60 months after the foreclosure.” The higher the poverty rate in the area, the longer the property stays vacant.

Foreclosed homes obviously lower the value of surrounding homes, but Whitaker says the damage can go on much longer than we might think. “The data suggest that foreclosure may permanently scar some homes,” he writes in his research.

Tomorrow we get the mid-year foreclosure report from RealtyTrac, which, given all the previous monthly reports, will likely show a drop in foreclosure activity overall; that is largely due to processing delays. In recent months bank repossessions, the final stage of foreclosure, have been ramping up, putting more foreclosed properties onto the bloated housing market. The banks know, of course, that the volumes are getting too high.

That’s why Bank of America launched programs recently in Cleveland, Chicago and Detroit to demolish some of the most run-down foreclosures in the worst neighborhoods. Interestingly, the Cleveland program is in the same county studied by Stephan Whitaker, Cuyahoga.

“Unfortunately, many homeowners faced with unemployment, underemployment and other economic hardships have transitioned to alternative housing situations, and in many cases have walked away from their homes, leaving behind vacant and deteriorating properties that can cause neighborhood blight,” said Rebecca Mairone, national mortgage outreach executive for Bank of America Home Loans in a press release last month.

Comment by michael
2011-07-28 04:46:43

my wife has a friend that is moving from the west to east cost. they are looking at houses.

my wife spent an hour on the phone explaining how he should rent for while…she used every HBB play (that i taught her) in the book and he still insisted.

it’s like a cult…it really…really is like an effin cult.

Comment by Overtaxed
2011-07-28 05:01:24

See, I think that’s a bad idea regardless of the RE pricing in the area your moving to. If you’re moving somewhere you’ve never lived before, it’s going to take a solid 6-12 months to figure out where the “good” and “bad” areas are, what the traffic patterns are like, and, most importantly, what you like and don’t like.

Moving across the country into a house that you very well may need to keep for the next 10-15 years (because of continued RE market weakness) is just not wise. What if you hate it after 2 years? Guess what; good chance you’ll have no choice but to stay.

Buying a house is a HUGE decision, probably the only bigger financial decision most people will ever make is to have (or not) children. It’s not something that you do in an afternoon; it’s something that you plan/save for years and then do very slowly and deliberately.

Comment by oxide
2011-07-28 06:05:24

It’s not something that you do in an afternoon; it’s something that you plan/save for years and then do very slowly and deliberately.

That’s what she said… about having children.

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Comment by Hwy50ina49Dodge
2011-07-28 07:19:40

then do very slowly and deliberately.

Yeah, then just remain calm & after your x17th offer to purchase, only to be out-bid again by Suzanne Researcher., her sil, her co-workers, and all her cousins who rabidly drool out of their mouths about getting on the RE Gain$burger gravey train… well, maybe thing$ have “toned down” a tad, that or there’s been a slight change in the homemoaner mind-$et. ;-)

Comment by Jim A
2011-07-28 06:51:21

Especially since they changed the law so you don’t have to plow your gains from selling your old house to avoid paying capital gains on it. WooHoo, tax free capital gains.

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Comment by Kim
2011-07-28 09:32:17

Well I’ll confess that law saved our bacon. We’ve been renters for about 3.5 years, and had we felt pressure to buy at 2009 prices we’d now be FBs too.

Comment by MrBubble
2011-07-28 08:38:49

“biggest financial decision most people will ever make is to have (or not) children”

Or you could just get bored in the middle of 3:10 to Yuma (original version) and get frisky with your S.O. Les jeux sont faits! Boom-shaka-laka…

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Comment by Hwy50ina49Dodge
2011-07-28 09:54:11

Les jeux sont faits! Boom-shaka-laka… ;-)

“You cannot directly pursue happiness” Aristotle

grumpy old coot, musta run out of olives!

Comment by michael
2011-07-28 11:03:28

bored during 3:10 to Yuma?

I loved that movie.

“and what’s that for?’

“making me nervous.”

Comment by MrBubble
2011-07-28 13:16:09

“3:10 to Yuma?”

The old one or the new one? We were watching the old one. I may have had a cocktail so that my attention was wandering…

Comment by wmbz
2011-07-28 05:06:04

Michael, You are exactly right, it is like a cult. I have a sister in-law who is a real-a-tor, (we do not talk RE) she was zombie-fied a long,long time ago. She once said to me that she thought it may take a couple of years to get back to where we were in 2005.

Comment by Arizona Slim
2011-07-28 09:04:39

My aunt’s youngest son is a real-ah-tor in Minneapolis. And he’s very into conspicuous consumption. Not our family’s way of presenting ourselves to the world.

This guy is the one who seldom gets mentioned during family gatherings. Or during phone calls.

It’s as if he doesn’t exist.

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Comment by X-GSfixr
2011-07-28 08:20:39

We’ve been finding out how the “Earth is round, not flat” bunch must have felt.

Comment by MrBubble
2011-07-28 08:45:06

I love this comment. Just seeing something that is so clear, yet cannot be fathomed by most. Very frustrating.

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Comment by salinasron
2011-07-28 04:54:45

“The data suggest that foreclosure may permanently scar some homes,” he writes in his research.”

It goes deeper than that. It is permanently scarring my want to buy a house ever. I sold in 2004 and decided to wait it out. I thought that I might be wanting to buy in 2010 and with the charade in housing as it is now moved the time line up to 2014. While I could easily buy some houses for cash, they are not what I want and I’m a very happy renter now. Before I had 4 kids at home and now none; and I love having no property taxes, maintenance, and the freedom to pick up and move at will.

Comment by X-GSfixr
2011-07-28 08:26:03

In my dreams, I hope all this turmoil will create the perfect opposing force to the bankster/business community:

A highly trained, technically saavy, totally mercenary workforce, who have no misplaced “loyalty” to their employers, and can pack up and move to the next “highest bidder” job at the drop of a hat.

Comment by oxide
2011-07-28 08:30:56

Cue Bill in Phoenix/Maryland/LA/Tampa/Phoenix in 3…2…1..

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Comment by X-GSfixr
2011-07-28 09:23:14

Imagine inflicting all the MNCs in the US with a horde of BiLA/DC/LAX types.

(Note: I’m not slamming BiLA. His lifestyle model, if reported accurately, works. I know several pilot’s operating under a similar plan, except they don’t work under government contracts, so their’s is more of a feast/famine plan).

Sow the wind, reap the whirlwind…….

Comment by Bill in Phoenix and Tampa
2011-07-29 16:44:25

I just got another direct hire into contracting. He got laid off a little over six weeks ago and is happy as a clam.

We high tech nomads are taking over. Life is good. Money is good.

Comment by Arizona Slim
2011-07-28 09:07:01

A highly trained, technically saavy, totally mercenary workforce, who have no misplaced “loyalty” to their employers, and can pack up and move to the next “highest bidder” job at the drop of a hat.

Back when I was an employee, I was a member of a professional association for people in the communication field. The org’s magazine often had articles on what happened to employee loyalty (it went poof) and what can be done to get it back (not much).

BTW, I left the employ of this organization to go freelance back in 1994.

So, we’re almost 20 years into the mercenary, career-first employee trend.

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Comment by X-GSfixr
2011-07-28 09:27:59

“……what can be done to get it back (not much).”

Actually, a couple of things would help:

-Stop trying to put the screws to employee pay/benefits, especially when you smell blood in the water, and

-Remember that just because a person works for you, doesn’t mean that you are smarter than they are.

Comment by oxide
2011-07-28 13:50:55

Why bother to get loyalty back when you can just outsource the job?

Comment by Bill in Phoenix and Tampa
2011-07-29 16:48:59

salinasron, freedom is great isn’t it? My dad always told me not to be a slave to my possessions. I got rid of my mortgage in the mid-90s and then I figured it’s better also not to be a wage slave either. Have suitcase, will travel (for $).

Comment by Jim A
2011-07-28 06:54:10

60 months!! How can anybody think that leaving a house vacant for 5 years is a good or even least bad idea? That’s even stupider than those flippers who thought it was a good idea to hold on to an empty house for 18 months to preserve that “new house smell”

Comment by CarrieAnn
2011-07-28 07:00:19

Sounds like they might be planning a permanent inventory reduction.

Comment by liz pendens
2011-07-28 07:42:06

The house accross the street from me (sold for $600k in 06) has been abandoned/vacant for over three years. Bank still has yet to foreclose even though the woman who owned it stopped paying the mortgage/taxes five years ago. She DIED over two years ago! What does someone have to do to constitute default around here???

Comment by Jim A.
2011-07-28 09:34:40

I wonder what happened at probate? You would think that forced some action.

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Comment by liz pendens
2011-07-28 11:46:00

The place has been “for sale” for two years (but has since been “pulled from market” a couple of months ago). We know some of the prospective buyers and realtors involved and the bank has turned down multiple offers @ their ASKING PRICE of $300k. House is now just rotting, waiting for what??? I just put the goats and donkeys over there this morning as part of my neighborhood “lawncare” solution. They do a fine job. Should send a bill to the bank…

Comment by Arizona Slim
2011-07-28 14:21:23

I just put the goats and donkeys over there this morning as part of my neighborhood “lawncare” solution. They do a fine job.

Are these the goats that jumped on the real estate agent’s car and scared the bee-jeebers out of her? Or am I confusing you with another HBB-er who has goats?

Comment by liz pendens
2011-07-28 16:10:38

Yes, Slim. Same realtor-repelling goats. (good on you for remembering my tale) Now going on third year of grazing the herd on bank-owned grass.

Liz Pendens = Pressboardbox

(the name had such a catchy ring to it, I could not resist)

Comment by Spokaneman
2011-07-28 14:17:24

In WA the County is required by law to forclose for unpaid taxes. My FIL has a house next door that was red-tagged by the health department because the owner was hording 40 some cats in unsanitary conditions. The bank won’t forclose as it will cost more to renovate the house than it is worth, so at some point, my FIL thinks after three years of unpaid taxes, the County has to act.

What a mess.

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Comment by Hwy50ina49Dodge
2011-07-29 01:02:56

What a mess.

Mice = no problems
FIL = oh, my…

Comment by Professor Bear
2011-07-28 07:40:52

“Foreclosed homes obviously lower the value of surrounding homes,…”

This meme is repeated so often in the MSM that I guess it is obvious to everyone that it must be true.

But how does this work? Suppose, for example, that the home next door to me is occupied by somebody who stopped paying their mortgage in a strategic default, even though they actually could afford to keep paying it. After three years, the bank finally gets around to foreclosing, the home goes back on the market for a lower (more affordable) price than the strategic defaulter had to pay, and a vibrant young family moves in with the prospect of making future contributions to the local economy and to the neighborhood.

Now did the fact that the home next door went into foreclosure make the surrounding property values go up or down? And who is to say that this scenario would not be repeated myriad times with the right policy formula, which does not include allowing lenders to sit on vacant foreclosure homes indefinitely until they crumble into dust?

Comment by Professor Bear
2011-07-28 07:43:10

P.S. I believe the confusion comes about when foreclosure homes sell for a lower price than homes were selling for in, say, 2006. But it is not the fact that the home went through foreclosure that explains the lower price; rather the foreclosure situation is why the home is on the market. Non-foreclosure homes have also sold for quite a bit less since the bubble popped, but their owners are less likely to need to sell them.

Comment by oxide
2011-07-28 18:08:30

An eyesore in an intangible.
A foreclosure auction is a COMP.

Comment by The_Overdog
2011-07-28 08:42:43

In Texas, winterized homes have a sign up on a window or door in the front notifiying the realtor that the home has been winterized, and not to turn on the water without cleaning up first. So it’s very easy to tell which homes have been sitting on the market a while.

I’d be surprised if they didn’t have similar notification requirements in Georgia.

Comment by wmbz
2011-07-28 02:53:32

Fannie/Freddie regulator sues UBS on $900 million loss

NEW YORK (Reuters) - The regulator for Fannie Mae and Freddie Mac sued UBS AG to recover more than $900 million of losses after the Swiss bank misled the housing agencies into buying $4.5 billion of risky mortgage debt.

In announcing Wednesday’s lawsuit, the U.S. Federal Housing Finance Agency said it also plans more lawsuits to recover additional losses by Fannie Mae and Freddie Mac from investments in private-label debt.

Last July, the FHFA issued 64 subpoenas to banks, seeking details about subprime and other mortgage debt that Fannie Mae and Freddie Mac bought when the housing market was healthy.

The UBS case is part of a push by Washington to hold banks responsible for the nation’s housing problems. It is also the latest effort to prop up the government-sponsored enterprises (GSEs), whose September 2008 federal seizure has so far cost taxpayers more than $135 billion.

Comment by oxide
2011-07-28 06:28:18

And there it is. We heard stories about Fannie/Freddie doing forensic account to root out the crappiest of the crap, and it looks like their efforts are starting to bear fruit.

Now, if only they could shove that $4.5 billion back down UBS’s throat instead of suing for $900 million. How much you want to bet that UBS will settle out of court for $65 million “not admit to wrongdoing?” :roll:

Comment by Jim A
2011-07-28 06:58:30

GRR….’round these parts I’d probably be rated as a GSE lover, but they should NEVER have been permitted to invest their far too limited capital reserves into pirvate label MBS bonds. It’s like company issueing flood insurance investing in RE in a flood plain. It’s a way of GUARANTEEING that just when you need that money, you won’t be able to get it.

Comment by wmbz
2011-07-28 03:12:02

Container-Ship Plunge Signals U.S. Slowdown: Freight Markets
By Kyunghee Park - Jul 28, 2011 (Bloomberg)

Plunging rates for chartering container vessels that carry sneakers, furniture and flat-screen TVs may signal a U.S. consumer slowdown and losses for shipping lines in what is traditionally their busiest time of the year.

Fees for hiring vessels have fallen 9.3 percent since the end of April, according to the Howe Robinson Container Index, which tracks charter rates for a range of vessels. Last year, the index surged 56 percent in the period, as lines added ships on demand from U.S. and European retailers restocking for the back-to-school and holiday shopping periods.

“The troubling part is that charter rates are falling in the peak season,” said Johnson Leung, head of regional transport at Jefferies Group Inc. in Hong Kong. “Sentiment among consumers and retailers isn’t very strong.”

Lines including Hanjin Shipping Co., Orient Overseas (International) Ltd. and Mitsui O.S.K. Lines Ltd. have also delayed the introduction of peak-season surcharges on Asia-U.S. routes by about two months as U.S. unemployment above 9 percent and slowing sales of new homes damp demand. Combined inbound container traffic at Los Angeles and Long Beach, the two busiest U.S. ports, dropped 4.6 percent last month, the first decline since January 2010, according to data compiled by Bloomberg.

‘Dire’ Situation

“The delay in imposing peak-season surcharges shows how dire the situation is,” said Um Kyung A, a Shinyoung Securities Co. analyst in Seoul, who cut her rating on Korean shipping lines to “neutral” from “overweight” yesterday. “The U.S. economy isn’t recovering fast enough to help increase demand.”

Comment by combotechie
2011-07-28 04:52:44

I’ve heard that longshoremen here is So Cal (at least some of them) are only getting work one day per week.

Comment by In Colorado
2011-07-28 09:19:36

I remember seeing lot’s of people buying expensive toys or loading up on other consumer goods at the local Sam’s club just a few years ago. Now it seems they just mostly buy food.

Comment by X-GSfixr
2011-07-28 09:32:40

Went to the local Wallyworld last weekend.

Place was practically a ghost town. Two years ago, the place was packed on Saturday/Sunday.

Evidently, it isn’t only the welfare/Social Security recipients running out of cash at the end of the month.

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Comment by drumminj
2011-07-28 09:25:28

I’ve heard that longshoremen here is So Cal (at least some of them) are only getting work one day per week.

Work for longshoremen in Seattle is down for sure (friend of a friend…)

Comment by salinasron
2011-07-28 05:02:34

I love articles like this where our government and MSM haven’t had a chance to spin and fudge data. Been one hell of a month with this report and all the company downsizing report.

Comment by Left Ohio
2011-07-28 05:13:59

Post 2001 recession: the jobless recovery
Post 2009 recession: the recovery-less recovery

Comment by Professor Bear
2011-07-28 07:45:26

The beauty of container ship and other shipping data is that it is international in origin and distribution, and hence very hard for the U.S. MSM to control.

Comment by Hwy50ina49Dodge
2011-07-28 11:47:03

Where’s Sir Greenis$pent’s “Box Index” Prof? ;-)

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Comment by oxide
2011-07-28 06:07:11

Anyone want to check the satellite pix off Singapore?

Electronic money lies, ghost ships do not.

Comment by rms
2011-07-28 06:50:33

“Container-Ship Plunge Signals U.S. Slowdown”

Not good news for an economy that is 70% consumer based.

Comment by Hwy50ina49Dodge
2011-07-28 08:36:02

$100,00 / $200,000 / $300,000 …Single Deposit Transaction$

1990 -2000 / Equites Transaction$
2001 - 2008 / Realty Transaction$
2009 - **** / ?

1. tulips
2. blogging newspapers
3. Dick Tracey 2-way wrist communicators
4. genetic pure beanie babies
5. remote control St. Joseph statue security robots

Comment by In Colorado
2011-07-28 09:23:21

Not good news for an economy that is 70% consumer based.

And even worse news for the Asian economies that supply those consumer goods.

Comment by MrBubble
2011-07-28 09:08:10

“sneakers, furniture and flat-screen TVs”

In the last two weeks, I bought two pairs of sneakers, one a replacement pair for last year’s worn out shoes and a pair of runner/hikers. That’s it. No furniture, no TVs, no iPuds, no cars, no gas, no dinners out, no lawnmowers, no Coke (Pepsi), no phone, no pool, no pets (seriously, except for the phone).

As for other expenditures: just rent, home-cooked food, meds/doctor visits and one ferry trip a day. Although we are getting a sitter and going to a Ben Sollee concert tomorrow night. Third time since the bambino came along. Whoop-dee-do.

Now multiply that by millions who are doing the same either by choice or by circumstance and still it’s not a very large number. Just cash and PMs for me, thanks. This sucker’s going down.


Comment by Kim
2011-07-28 09:48:58

Well I spent a grand total of $44 on DD’s back-to-school shopping this year. Except for a pair of shoes or two, we’re finished. We’ll hit up the school’s free uniform swap for new duds. She didn’t want a new backback, because “then it wouldn’t match (her) lunchbox” (and last year’s backpack is still in excellent shape).

Comment by aNYCdj
2011-07-28 11:21:52

How about a blast from the past The New York Rock Ensemble…violins cello…


Mike Kamen this song is way kick azz cool:


Comment by wmbz
2011-07-28 03:15:15

From Bill Bonner, who has been dispensing advice to which the majority does not listen since 1979:

“The Keynesian stimulus model stops working when the economy shifts from adding debt to destroying it. Then, you can put out all the additional cash and credit you want. It won’t do any good. Households are reluctant to borrow; first, because they don’t have the income or the collateral to support it, and second, because they’ve already got too much debt and are eager to get rid of it.

“When the economy goes into a credit contraction, trying to add more debt is like pouring whiskey down the throat of a passed-out drunk. It’s not the kind of medicine he needs.”

Comment by combotechie
2011-07-28 05:06:44

” … shifts from adding debt to destroying it.”

Destroying debt is destroying money. Whoever is at the wrong end of the debt that gets destroyed gets to watch his money get destroyed.

Promises of money that are destroyed has the same effect as debt that is destroyed in that whoever is at the wrong end of this destruction of promised money gets to watch the destruction of his promised money.

Social Security is promised money. Take a look at what is promised and what should be considered reasonable to deliver and you will notice a very large gap. And a very large portion of our population is depending on this gap somehow being filled. But this gap won’t be filled, not all of it at least, because the promised money is just not there. Which means a lot of people who have been promised a lot of money are going to have to somehow learn to do without.

Comment by Bill in Carolina
2011-07-28 06:49:20

Yesterday’s bucket included a post and link about how few children (future workers and SS contributors) are being born these days.

This is the aspect of SS that makes it a pyramid (Ponzi) scheme. It depends on an ever-larger base to support the levels above it. When that base shrinks, the collapse is inevitable.

Comment by In Colorado
2011-07-28 10:52:09

Or the benefits simply get reduced, which is hardly a “collapse”.

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Comment by Xiaoding
2011-07-28 14:55:42

“This is the aspect of SS that makes it a pyramid (Ponzi) scheme. It depends on an ever-larger base to support the levels above it. When that base shrinks, the collapse is inevitable.”

Except that technology improves, things get invented, the world changes. The smaller, succeeding, generation may outproduce the previous one, and make such factors moot.

We won’t need so many folks, if we got general pupose robots, and real AI. Then there’s fusion, or some other thingy. and then there’s Maude.

Hell, we may not even have a thing called “money” in twenty years!

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Comment by drumminj
2011-07-28 09:43:31

Whoever is at the wrong end of the debt that gets destroyed gets to watch his money get destroyed.

Unless it’s the bank that created the money. Then there’s no harm (IMO). Instead, the money supply simply shrinks.

Comment by cactus
2011-07-28 18:18:20

Social Security is promised money.’

Like stock options easy to promise but come payoff it just gets downrounded

Comment by alpha-sloth
2011-07-28 05:07:32

You’d think after all these years Bonner would have learned the difference between Keynesian theory (stimulus) and monetarism (super-cheap money for the banks to encourage lending).

Keynes was the guy who brought the phrase ‘pushing on a string’ into the national lexicon. To accuse him of the very thing he often warned about is rather misleading, but I guess misinformation helps herd the sheep in your direction.

Comment by oxide
2011-07-28 06:25:26

“The Keynesian stimulus model stops working when the economy shifts from adding debt to destroying it.”

No, the Keynesian stimulus model stops working when it stops being Keynesian. But of course, they still call it Keynesian. It’s a deliberate LIE. It’s like taking the wings off an airplane, calling it at airplane, and then blaming Boeing when the airplane dosen’t take off.

Comment by Ol'Bubba
2011-07-28 07:01:08

That sounds like a job for the wingnuts. :)

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Comment by butters
2011-07-28 07:08:56

But you guys do that to the other side all the time……

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Comment by salinasron
2011-07-28 05:09:57

“When the economy goes into a credit contraction, trying to add more debt is like pouring whiskey down the throat of a passed-out drunk. It’s not the kind of medicine he needs.”

We went into a credit contraction because of over lending. When you stack debt upon a person to the point that he/she no longer has disposable income but only has income to service debt, you get a contraction in spending and credit.

Comment by combotechie
2011-07-28 05:25:51

“We went into a credit contraction because of over lending.”

And this over lending distorted the hell out of the economy.

And now the over lending has stopped the economic distortion is in the process of correcting itself and is leaving many people high and dry.

Comment by rms
2011-07-28 11:45:08

“…and is leaving many people high and dry.”

And they’re buck a$$ naked. -Omaha

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Comment by oxide
2011-07-28 06:49:24

No, the medicine we need is JOBS. As in, bringing them back.

Comment by Hwy50ina49Dodge
2011-07-28 07:31:20


“…if you tax them less, they can hire more people!”

Hurry! reduce/eliminate their taxe$, hurry,… Cinder$ & Ashe$…Schemer$ & Scammmer$…Agonie$ & Pain$, help ‘em…help ‘em.

Job$! Job$! Job$! + No tax increases on the Wealthie$ (They’re $uffering $o!)

“TruePatriotCEO’$™” plead, plead, plead: “give u$ a tax repatriation holiday and we’ll bring the money back and start creating Job$! Job$! Job$!…”

Vote for us “TruePathtoPeonPro$perity™” / “TrueNon-WarMaker$Fi$calConservatives™” / “TrueEthnicCompa$$ionateConservative™” repubicans, …’cause we have a plan!:

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Comment by measton
2011-07-28 09:25:57

They will but you will work for a bowl of rice and a cardboard house with a sheet metal roof. That’s the future middle class.

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Comment by In Colorado
2011-07-28 10:56:53

That’s right. The only way to remain in what we know today as the middle class will be to become a member of the managerial class. You will need to be a boss. I think the kids today “get it” as B schools are packed while engineering schools are not. Why bust your hump to become an engineer and have your job offshored?

In 3rd world countries even first tier bosses are paid multiples of what their worker bees get. Which is why you get the phenom Rio has observed in Brazil: A 3rd world country and 1st world country living side by side.

Comment by In Colorado
2011-07-28 11:18:23

Or look at it this way: My brother worked in procurement at a large Mexican conglomerate. He had an engineering degree and worked there as an individual contributor with 5 years experience.

His salary was $800 USD a month. He lived at home with my mom and he had to take public transportation to work as he couldn’t afford a car.

They transfered him to a small branch office in Brownsville, TX and his salary more than tripled. The first thing he did upon arriving in Brownsville (after renting an apartment) was go out and buy a new car (a humble Ford Festiva).

Comment by cactus
2011-07-28 18:31:56

Why bust your hump to become an engineer and have your job offshored?’

start-ups work for start-ups. You have to bust it and eventually it goes public and gets wrecked but at least for a time you’re as close to the real money as possible.. for an Engineer.

Otherwise yea its a slow road to going obsolete then getting laid off in your 50’s and good luck getting a job after that.

my co-worker manager just disageed with me though so what do I know anyway? he hires I don’t.

Comment by Professor Bear
2011-07-28 07:46:40

On the other hand, making a hard-core alcoholic go cold turkey could kill him as well…

Comment by aNYCdj
2011-07-28 11:38:38

Amy Winehouse Died from Alcohol Withdrawal, Says Family


Comment by Professor Bear
2011-07-28 12:25:20

Dang — I was just going to post that. You beat me to the punch!

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Comment by Arizona Slim
2011-07-28 14:23:58

That’s why I think that addiction treatment, particularly in the detox stage, should be focused on the medical side of things.

Once you get the person weaned off the drugs and medically stabilized, then you can start working on what caused them to pick up the drugs in the first place. And helping them to build a new, stronger, drug-free self.

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Comment by RioAmericanInBrasil
2011-07-28 03:58:54

Why do so many smart people still fall for such disproven claptrap?
Top BS list of the past 30 years?

Lowering taxes on the rich will create jobs
Off-shoring will free up Americans for higher paying jobs
Ketchup is a vegetable
The Iraq war will cost 70 billion max
Iraq has WMDs
Obama was born in Kenya, (Kenya Indonesia to be precise)
Mexicans do the jobs American’s won’t do
Free trade will be good for America
CRA caused the housing bubble because those are the only bad loans
Lowering taxes on corporations will create jobs
Corporate money in elections is free speech
A reliable source cited in the NYT is invalidated because it’s in the NYT
American corporations pay the highest corporate taxes in the world
The Civil War was not about slavery
CEO’s make 500 times the average salary because of their “talent”
The rich getting way richer the past 30 years is not re-distributing wealth
Americans have the best health care in the world
Being gay is a choice
Allowing super-rich to get richer will create American jobs
FDR’s new deal prolonged the Great Depression
Private charities will make up for our dismantled safety nets
The market is all that is needed to regulate banks
The government should not get involved in my grandma’s Medicare
Fossils are God’s way to trick and test us
Social Security is broke
1/3 of Americans are not morons

Comment by Ben Jones
2011-07-28 04:24:44


Wow, you must have quite the think tank down there to have actually proved all these things false. You left out UFOs and Elvis being alive, though I haven’t heard what you guys discovered yet.

Now, what am I gonna spend my SS on!

Comment by oxide
2011-07-28 09:21:34

Actually I think Rio HAS given evidence on at least half of these false assertions.

Comment by ecofeco
2011-07-28 13:47:15

As have I.

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Comment by RioAmericanInBrasil
2011-07-28 12:54:43

‘disproven’?….you must have quite the think tank down there to have actually proved all these things false.

Yes. Disproven. Proved a falsehood. And it isn’t hard. I’ve even done it many times on many of those issues citing academic, economic, private industry and government studies.

(But some of the sources were cited in the NYT)

Don’t know about UFO’s

Comment by Blue Skye
2011-07-28 04:58:08

Are you saying that the tomato is a fruit? Does it have a choice?

Comment by Ol'Bubba
2011-07-28 06:18:49

The last time I read the ingredients label on a ketchup bottle it listed high fructose corn syrup one of the main ingredients.

Think of ketchup as a candied tomato sauce.

Comment by alpha-sloth
2011-07-28 06:26:01

And, of course, the tomato is a fruit, and about that it has no choice, being born that way.

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Comment by Hwy50ina49Dodge
2011-07-28 09:17:25

Do you reckon grocers putting an “eat me” sticker would blur the consumers reasoning process?

Comment by Blue Skye
2011-07-28 12:06:26

My mother, the Home Economics teacher, would explain to you in detail, and at length, that the tomato is a vegatable. I’m not sure you would like to hear this explanation. I’m not sure I would either.

Comment by alpha-sloth
2011-07-28 19:33:24

“My mother, the Home Economics teacher, would explain to you in detail, and at length, that the tomato is a vegatable”

And, alas, she would be wrong. Have her ask the biology teachers.

Comment by oxide
2011-07-28 06:33:59

Technically tomatoes are fruits, but the point was that Reagan(?) thought that a teaspoon of heavily sugared tomato paste counted as a full serving of vegtables.

When chef Jamie Oliver tried to reform school lunches in West Virginia, they compared a highly colorful Oliver lunch to a typical nasty hamburger-french-fry lunch. The school district nutitionist refused to served Oliver’s lunch because it didn’t fit the standards (not enough veggies, I think), while the French Fries and hamburger fulfilled the vegetable requirement.

Comment by The_Overdog
2011-07-28 08:47:18

Jamie Oliver is kind of chubby, so seeing him chastize people for their eating habits is kind of funny.

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Comment by Sean
2011-07-28 12:18:51

Ever heard of the phrase “Don’t trust a skinny cook”.

Comment by Blue Skye
2011-07-28 12:09:59

Wiki tomato….Vegatable……egad.

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Comment by RioAmericanInBrasil
2011-07-28 12:58:20

Wiki tomato….Vegatable……egad.

History is fun:

“The ketchup as a vegetable controversy refers to a proposed United States Department of Agriculture (USDA) Food and Drug Administration directive, early in the administration of Ronald Reagan, that would have reclassified ketchup and pickle relish from condiments to vegetables, allowing public schools to cut out a serving of cooked or fresh vegetable from hot lunch program child-nutrition requirements. The White House Office of Management and Budget estimated a potential US $1 billion annual savings in the cost of subsidized meals for low-income students.

Release of the proposed directive for required public comment in September 1981 met with outrage from nutritionists” wiki

Comment by Overtaxed
2011-07-28 05:14:51

“Fossils are God’s way to trick and test us”

IMHO, anyone who believes this should be deemed ineligible to vote. And, if you believe this, you absolutely should not be allowed to hold a public office.

Look, I understand that some people have strong religious beliefs. But, if you REALLY believe some of the more “hardline” religious doctrine (and aren’t just like most, parroting whatever they need to to get elected, then laughing at the faithful all the way to their seat in Congress) you are mentally unstable. Yes, I said it…

Those who believe that the world was created about 8,000 years ago; I’m talking to you. People who are “awaiting the rapture”; yup.. I’m talking to you too. You have been brainwashed, and many of you are just a few steps from strapping bombs on your chest and walking into a crowded room.

Encouraging these folks (like the Republicans are so fond of doing) is like spurring on the People’s Temple. I’m sorry, but this kind of behavior should not be encouraged, and should certainly not be pandered to by our leaders. Hardline religious beliefs are one of the most dangerous things that we can ever introduce to a culture and yet, as every day passes, we get more and more “radicalized” in this country. The Evangelical movement is but one example (but one of the biggest)..


Comment by Blue Skye
2011-07-28 05:28:51

Did you know that some of our politicians are Bipolar and from time to time exhibit psychotic behavior? Does that make everyone involved in politics a huge threat to our country? How about movie stars?

Comment by Jojo
2011-07-28 06:32:36

Are you suggesting that there are some politicians that don’t exhibit psychotic behavior?

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Comment by michael
2011-07-28 06:11:42

if you put enough people on an island…it will topple over and you will die.

Comment by RioAmericanInBrasil
2011-07-28 13:14:32

if you put enough people on an island…it will topple over and you will die.

Only if they all go to one side which is now illegal in Guam.

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Comment by Hwy50ina49Dodge
2011-07-28 08:21:39

Creationism + “intelligent design”

genetic code: atgc

phenotypical sexual coupling orientation results: (yes, lil’ johnny there are rare “exceptions”)

3. the adjustment or alignment of oneself or one’s ideas to surroundings or circumstances

dichotomy pairing: (current human animal/divine being, standard model)

penis - penis
vagina - vagina

(one of the oldest and most widely known surviving English nursery rhymes.):

Pat-a-cake, pat-a-cake, baker’s man.
Bake me a cake as fast as you can;
Pat it and prick it and mark it with B,
Put it in the oven for baby and me.

How Long Does it Take Sunlight to Reach the Earth?: :-)

There are a couple of numbers to know and two simple division problems involved in figuring out ”how long does it take sunlight to reach the Earth”. The first number to know is the speed of light in a vacuum, which is 300,000 km/s. Next, you need to know the average distance from the Sun to the Earth, which is 150 million km. Divide the distance by the speed of light and you have 500 seconds for light to arrive on Earth. Finally, divide 500 seconds by 60 to get the number of minutes and you have 8 minutes and 20 seconds.

The Sun accounts for 99.8% of the mass of our Solar System. The majority of the remaining 0.2% is accounted for by Jupiter. The Earth is relatively insignificant when compared to the mass of the Sun.

Lucy: “Hwy, you’re such a BLOCKHEAD!”

Comment by alpha-sloth
2011-07-28 09:16:54

Salvador Dali lives! :wink:

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Comment by RioAmericanInBrasil
2011-07-28 13:12:29

People who are “awaiting the rapture”; yup.. I’m talking to you too. You have been brainwashed, and many of you are just a few steps from strapping bombs on your chest and walking into a crowded room.

Or even getting access to the presidential nuke code “football”.

Bachmann Predicted The World Would End In 2006: ‘We Are In The Last Days’

Audio here 1/2 way down (very comforting):

Bachmann predicts, “We are in the last days,” and says, “The harvest is at hand” — a Biblical allusion to the Rapture when some believe God will take saved Christians from the earth and leave the non-believers to face several years of torment and tribulation before the second coming of Christ:

BACHMANN: Lord, the day is at hand. We are in the last days. You are a Jehovah God. We know that the times are in your hands. And we give them to you…The day is at hand, Lord, when your return will come nigh. Nothing is more important than bringing sheep into the fold. Than bringing new life into the kingdom…You have weeded that garden. The harvest is at hand.

Comment by Hwy50ina49Dodge
2011-07-28 16:37:47

“Boys, diz like this, that turkel, she’s daid, …she justs don’t knows it.” :-)

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Comment by ahansen
2011-07-28 17:46:31

Nitwits need a voice in Congress, too…..

Comment by Jojo
2011-07-28 06:29:23

“1/3 of Americans are not morons”

You think it’s even less? Well, you’re probably right.

Comment by liz pendens
2011-07-28 08:40:24

Not Sure for President.

Comment by alpha-sloth
2011-07-28 06:30:31

Great list, Rio! You hit almost every one, except:

America is a Christian nation.

which is even less true now than it was at our founding.

Comment by nickpapageorgio
2011-07-28 15:28:04

Yep, I think Progressivism and the worship of all things Government could now be classified as the majority religion, although thankfully still a popular minority.

Comment by wmbz
2011-07-28 04:10:09

Visa Beats Estimates as Spending Increases

Visa Inc. (V), the world’s biggest payments network, said fiscal third-quarter profit rose 40 percent, beating analyst estimates, as consumers boosted credit- card spending.

Chairman and Chief Executive Officer Joseph W. Saunders is looking to expand abroad as new U.S. limits on debit-card swipe fees charged to merchants threaten to crimp revenue growth at home. Visa, which got about 59 percent of sales from the U.S. last fiscal year, aims to generate more than half its revenue in international markets by fiscal 2015, Saunders has said.

“While the regulatory process generated headlines over the past 13 months, the overwhelming majority of Visa’s revenues are derived from products and geographies that are completely untouched by these events,” Saunders, 65, said during a conference call with analysts and investors.

Comment by wmbz
2011-07-28 04:18:50

We are always late to the party here in central S.C.

Columbia area climbs in foreclosure ranking
By KRISTY EPPLEY RUPON - krupon@thestate.com

Columbia is catching up to the nation in foreclosures as areas that were harder hit earlier in the Great Recession start to see a turnaround.

The Midlands area ranked 66th in the nation in the percentage of homes in foreclosure among top metro areas – up from No. 103 last year – during the first six months of the year, according to a report released today by RealtyTrac.

“Columbia has always kind of lagged behind on the trend,” said Karen Yip, an agent with Re/Max Real Estate Services in Columbia.

Housing woes
Foreclosures are falling nationwide, but they rose in Columbia and Myrtle Beach during the first six months of the year.

In 2008, as the recession was starting to take hold, “the numbers were still looking pretty steady for us here in South Carolina,” Yip said. It wasn’t until 2009 that the real estate market began to falter locally.

“We haven’t gone through the full cycle,” she said.

In the Columbia metro area, just under 1 percent of homes with mortgages were in foreclosure during the first half of 2011. The number of homes in foreclosure – where a legal notice had been filed at the courthouse but the home had not yet sold – jumped 9 percent to 3,095 in the first six months of the year, compared with the same period in 2010, the report said.

The coast also continues to struggle. Myrtle Beach-area foreclosures rose 23 percent for the period to 1,756. Myrtle Beach’s national ranking also jumped to No. 63 this year from No. 111 last year.

The Greenville metro area saw an improvement for the period, with foreclosures dropping 29 percent to 2,161. Its ranking dropped to No. 86 from No. 80 last year.

Nationally, the number of homes in foreclosure dropped 29 percent to 1.17 million during the first six months of the year, compared with the same period last year.

Comment by Jess from upstate SC
2011-07-28 04:49:51

Greenville SC never had the Bubble as bad as some . Who was the big Florida builder who pulled out of Greenville SC in 2007 , complaining that Greenville just did not have the RE sizzle ?? Can’t remember their name but assume they downsized somewheres later …

Comment by jeff saturday
2011-07-28 05:48:29

Palm Beach County foreclosure filings fall 41%

By Kimberly Miller Palm Beach Post Staff Writer
Posted: 6:40 a.m. Thursday, July 28, 2011

South Florida relinquished its top-10 foreclosure rank during the first part of this year, falling to 30 nationally as court delays and paperwork do-overs continue to stall bank repossessions.

In Palm Beach County, 10,642 homes received a foreclosure filing in the first half of the year, down 41 percent from the same time in 2010, according to a report to be released today by the Irvine, Calif.-based RealtyTrac.

Statewide, 113,631 homes received a notice of foreclosure in the first six months of 2011, a decrease of 59 percent compared with last year.

“The big drop-off is largely the result of processing holdups and not a sign that there is a robust recovery in the housing market,” said RealtyTrac spokesman Daren Blomquist, who noted that it now takes an average of 676 days, nearly two years, to foreclose on a Florida home.

In 2007, the average was 154 days.

Comment by alpha-sloth
2011-07-28 06:44:33

“as court delays and paperwork do-overs continue to stall bank repossessions.”

‘Paperwork do-overs’? More like doing it for the first time, unless having ‘robots’ sign false affidavits counts as doing it once already.

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Comment by Jim A
2011-07-28 07:15:02

The problem is that if the servicer didn’t properly execute the assignments the first time, then the trust may be able to push the non-performing loan back to the originator. THIS is the elephant in the room with the robo-signing nightmare that ALMOST NOBODY wants to wake up. Fortunately for the FIRE industry, the trustees are working hand in glove with the banks rather than actually trying to protect the bondholders whose interests they are theoretically supposed to be looking out for.

Comment by alpha-sloth
2011-07-28 11:19:02

Exactly, Jim A. Robo-signing wasn’t about cutting corners due to an overwhelming amount of paperwork, it was about that paperwork not existing, and no one in the know wanting to sign their names swearing it did.

Comment by palmetto
2011-07-28 06:00:26

Greenville is one of the best kept secrets in the US, I think. From what I’ve been reading, it’s one of the few places where you can get a decent job if you’re qualified. Many of the folks who couldn’t find work in Asheville after looking for a year or two went to Greenville and got a gig within a month. I figure if you’re going to live in that area, the best place to be is a spot equidistant between Asheville and Greenville.

Heading up that way soon to scope things out.

Comment by Bill in Carolina
2011-07-28 07:01:10


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Comment by NCgal
2011-07-28 08:03:16

And Greenville has a decent airport. It is expensive to fly anywhere out of Asheville.
No jobs in Asheville unless you are a waiter or an artist.
It is very frustrating here and we are getting ready to move after 5 years.

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Comment by Hwy50ina49Dodge
2011-07-28 11:42:08

And Greenville has a decent airport.

May not be true today, but not so many years back flew with my lil’ bro (a cig smoker) as where walking through the terminal, he’s anxiously looking for a place to have a cig, walks up to a janitor and inquires where he can smoke…“Go ahead lights ‘em up son, yous here’s in North Carolina now!”

Comment by michael
2011-07-28 04:40:01

“US debt default fears grow as UK becomes safest haven for bondholders”

holy crap…we are in trouble!

Comment by edgewaterjohn
2011-07-28 08:00:36

You ain’t kidding! I about sprayed my tasty beverage upon reading that.

Comment by SV guy
2011-07-28 08:20:58

“I about sprayed my tasty beverage upon reading that.”

“Is that a Big Kahuna burger?”

Guess the movie.

Comment by MrBubble
2011-07-28 09:16:25

“That IS a tasty burger”

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Comment by X-GSfixr
2011-07-28 09:37:08

Samuel L. Jackson gets my vote for the coolest/baddest dude alive. :)

“pull out my wallet…….it’s the one that says “Bad Mother….er”…..”

Comment by JIm A
2011-07-28 10:30:27

Rumor is, he’s going to play Sho ‘Nuff in the remake of “The Last Dragon.”

Comment by Mike in Miami
2011-07-28 04:40:25

Pay too much taxes? Government micro manages your life? Don’t like it? You’re free to leave.
Looking into my crystal ball I can see clear now that the feces is about to hit a rotary device near me. I have been toying with the idea to follow my own advice and get up and leave. I did that once before when I escaped the German draft an came to the US in 1987. Long story and odyssey…don’t want to get into the details.
Back then it was the cold war and being forced into something I deeply despise. Gotta get out of this place…
Now it sure looks like the international banking cartel gets a stranglehold on our tax revenues. The entire EURO land drama was not about rescuing Greece, Ireland or Portugal, it was about diverting as much tax revenue as possible to the banksters. Same is going to happen right here in the US in the not too distant future. If one big domino falls (Greece, Clownifornia, Spain, a few big banks, etc.) then the entire western financial system is sure to follow. I don’t think it’s a question of if, just when.
Anyway, I want to get out of the way before it happens. So far my search has turned up very little useful destinations outside the US and EURO-land.
Thailand - cheap, but don’t really fit in. Security concerns.
Cambodia - ditto
Paraguay - cheap but 3rd world country, security concerns
New Zealand - nice but very difficult to get resident status
Nicaragua - cheap, easy to enter, security concerns, possibly unstable
Chile - very nice & prosperous, easy to enter, too many earthquakes
Costa Rica - nice but very expensive
Belize - cheap, very corrupt, security concerns
Venezuela - I’ve been there. My wife is from there. Reminds me of East Germany, horrible.
Kanada - cold and expensive, otherwise pretty nice.
Mexico - security concerns, politically unstable
Uruguay - ?? anybody ever been there? Is is safe?
Africa & Asia are simply not an option.
…anybody ever been to a really nice and safe place outside the US and Europe that is easy to relocate too?

Comment by michael
2011-07-28 04:54:57

just move to Texas!

Comment by X-GSfixr
2011-07-28 08:44:08

Texas - Too hot, too dry, too many Southern Baptists and Evangelicals, too Tea Bagger. Moving toward privatization of all public services. No coherent zoning regulations detectible. Too many pickup trucks, cowboy hats. High plastic surgeon/population ratio, especially in DFW and Houston.

Comment by ecofeco
2011-07-28 13:56:47

You REALLY have been here!

You also forgot very little worker protections or civil rights. Well, none, actually.

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Comment by Blue Skye
2011-07-28 05:39:05

What exactly are you afraid will happen to you if the debt pyramid implodes?

Comment by Mike in Miami
2011-07-28 09:24:28

Austerity, civil unrest, civial war…
Just like the great depression but not as civilized.
More people, more attitudes, more guns, difficult to predict but I don’t want to be around to find out first hand. Especially not in Miami.

Comment by RioAmericanInBrasil
2011-07-28 13:25:20

Austerity, civil unrest, civial war…

I’d relax.
There will not be another American Civil War. We are not in that kind of spot.

The last American civil war was fought because the southern cotton growers’s market was being infringed on by the growing Northern manufacture of Polyester.

(But on Uruguay: Know a doctor who “escaped” there and loves it.)

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Comment by palmetto
2011-07-28 06:08:23

“Uruguay - ?? anybody ever been there? Is is safe?”

Never been there, but done a bit of reading about it online. From what I’ve read, it’s definitely worth a look. The safety issue exists wherever you go, but my take, after reading, is that it is no less safe than the US, and definitely no less safe than Florida. If you know how to navigate Florida (avoiding certain neighborhoods, not walking the streets at night, etc.) you’ll be fine in Uruguay. Very stable country, or so my research says.

Reading your list, it was the one country that stuck out as a place I’d consider. I’ve given up on any country in the Euro zone, Asia, or Africa. Doesn’t leave much choice, does it?

Comment by palmetto
2011-07-28 06:26:22

Mike, your post brings up EXACTLY what it is I despise about globalization. Reduction of choice. Countries not being allowed to determine their course. Until we discover another planet that would support life as we know it, globalization cannot be allowed to stand.

I, too, have been researching other options. I eliminated both New Zealand and Chile because of the earthquakes.

Comment by Mike in Miami
2011-07-28 07:22:37

Yes, Europe has many nice place as far as culture, people, safety and climate are concerned. Too bad it fell to the banksters and their EURO. I just hope the people rise up and throw the Eurocrats out of office.

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Comment by drumminj
2011-07-28 11:33:38

Mike, your post brings up EXACTLY what it is I despise about globalization. Reduction of choice. Countries not being allowed to determine their course.

That’s not specific to globalization. It’s an outcome of centralized government.

Look at the different states in the US. Choices have been significantly limited as well, as more government has been moved to the federal level from local.

People wanting to have control over other people’s shit is the root of all of this, IMO.

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Comment by RioAmericanInBrasil
2011-07-28 13:32:37

That’s not specific to globalization. It’s an outcome of centralized government.

It would not be the outcome (even with a centralized government) if a country would reject globalization and protect its people, investment in advancement and its jobs.

That’s what comes first in this argument. First.

Comment by Mike in Miami
2011-07-28 07:18:18

Yes, I put some research into Uruguay already. That’s why I asked if anybody has ever been there. From what I have been reading Uruguay seems to be my favorite. Low taxes, government that stays out of your life as long as you behave, decent health care, low crime and relatively low corruption by SA standards, politically stable, good climate, easy to get residence status.
I guess I plan my next vacation there to see 1st hand what it is like. People write so much, nothing beats personal experience. I was in Venezuela (Maracaibo) last year. The decay of infrastructure reminded me of East Germany, plus throw in a bunch of crime, grinding poverty and pollution and you have a real nightmare. Power outages, water outages that last for days, 30% inflation…awful.

Comment by X-GSfixr
2011-07-28 09:38:48

“Is it safe?”

Depends on if you are Dustin Hoffman or not…..

Comment by stewie
2011-07-28 11:52:59

You might want to reconsider the Eurozone, specifically Norway. Yeah, its cold, but even if one goes apes**t and kills 100 people, the most you’ll get is a 2 decade vacation here.


Hell, you could probably DUI manslaughter someone and be out by the time you sobered up.

Comment by Neuromance
2011-07-28 16:59:58


Comment by liz pendens
2011-07-28 06:22:46


Comment by Mike in Miami
2011-07-28 07:19:29

Ever been there? I know little about the place. Seems desperately poor, possbile safety concerns…not sure.

Comment by liz pendens
2011-07-28 07:37:24

No Mike, I have not. Met some who have been, and a girl who grew up there. All said things were incredibly inexpensive there.

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Comment by edgewaterjohn
2011-07-28 08:06:24

Three Filipino-Americans work in my area, they always want to go home and do so every chance they get. So, it can’t be that bad. They’ve shown me pictures, pretty enough.

OTOH, I worked with Navy guys that told me all about the horrors in the areas surrounding Subic. So, it’s probably like the rest of the world - fragmenting socioeconomically.

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Comment by Jim A
2011-07-28 07:19:56

ISTR the story of the guy back in the 70s who was trying to figure out where to go to avoid a NATO/Warsaw Pact WWIII. He wanted someplace far away, with a stable government and self sufficient agricultural base where they spoke English so he wouldn’t have to learn another language. After considerable research (pre-google, when that involved actual trips to research libraries) he had his answer: the Falkland Islands.

Comment by oxide
2011-07-28 07:45:33

Mike, there’s Scandinavia too. Norway is very stable and they have oil.

You sound more like you want to live in a low-level Oil City type situation than to escape the country. There are still places in the US where you can avoid the worst of the nanny state. Look at all your mail (and email) for a month, and ask yourself: how can I avoid getting this piece of mail? Own a house outright, and you won’t have a mortgage payment. Stop buying from catalogs and unsubscribe from the annoying sale emails. If the house has a well and septic tank, that avoids water and sewer. Shop for everything at Wal-mart using cash. Ditch the car and ride a bike to avoid the DMV system and insurance. Each bill you eliminate will remove you a little bit from the nanny system.

Then you have to decide if you need Facebook, Amazon dot com or Netflix, and what to do if you get sick or break a leg. If you give up being watched by the system, then you give up being protected by the system.

Comment by Mike in Miami
2011-07-28 07:57:27

I am sure Norway is nice, safe and very stable. Problem is it is extremely expensive and cold. I don’t understand the language either. Scandinavian languages are difficult to learn. I know English, German and a bit of Spanish (currently studying).
I like farming, warm/hot climate but no desert, little government, politically and financial stable countries. I don’t like polluted crowded places (Miami comes to mind), a nanny state that regulates my life (most of Europe) any place that is unstable as far as government and the ground below my feet (earthquakes). OK, I know I am being picky… that cuts out about 99% of all inhabitable places on this planet.

Comment by palmetto
2011-07-28 08:54:12

I wouldn’t touch anywhere in Scandinavia with a ten foot banana. Expensive and cold, you got that right! Plus it’s extremely screwed up. Eloi sitting ducks, as illustrated by the recent “troubles”.

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Comment by In Colorado
2011-07-28 09:09:51

One thing to keep in mind is how will you earn a living in your third world fox hole? You will find that many countries will welcome you if you can show that you are financially independent. But if you want a visa that allows you to work … good luck. And even of you can get such a visa you’ll find that wages are unbelievably low, you’ll be discriminated against being a foreigner and the creature comforts are just as expensive as they are here, and the basics, while cheaper, will look expensive compared to your microscopic paycheck.

Or look at it this way: the average SS check in the US will be more than you can earn there.

Comment by Mike in Miami
2011-07-28 09:19:34

The trick is to:
a. Have some savings, $150+K
b. find a place that is cheap to live
There’s a big difference if you need to make enough to just sustain what you have (like house or car) or if you need to earn enough to buy those things in the first place. Since some of the places mentioned are relatively inexpensive (at least housing) all you need is to make enough money to sustain yourself. Buying a $100K house if you only make $15K is a big deal even if everything else is dirt cheap. If you own the $100K house and make only $15K you’re setting pretty….well at least that’s the general idea.

Comment by oxide
2011-07-28 09:40:07

Dude, this is SO Oil City Plan…

The South is the least nanny, best with guns, and warm. Pick a small town, preferably a university town in the Middle South: Tennessee, Kentucky, North Carolina. University towns tend to be more diverse, so they won’t discriminate you when they hear your German accent (if you have one). Also, they tend to have medical schools and hospitals, which is a plus.

Buy a shack outright about 20 miles outside the city center. You can get something good for $70K, plus have leftover to fix up the house or buy necessities. Work at McD or similar for minimum wage. Live cash.

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Comment by X-GSfixr
2011-07-28 09:47:43

“own the $100K house and make only $15K, you’re sitting pretty……”

There’s a lot of places in Flyover that match that description. At least as long as the sales/property taxes don’t go crazy. And you don’t plan on doing ANY traveling or vacations, and don’t mind only seeing the kids/grandkids once a year.

Want to listen to some real bitching? Send the big city/suburban kids out to the Grandparents in BFE for a couple of weeks during the summer.

Don’t bother to bring the Xbox, Playstation, laptops or cellphones……..no high speed internet, no cellphone coverage, and the games don’t run too well on the old 19″ tube TV.

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Comment by Carl Morris
2011-07-28 10:11:01

We do that and for some reason my son loves going to BFE Wyoming even more than I do. Even without his PS3. The only tech we do is play Starcraft against Grandpa on his computers. Everything else is just good food, shooting, riding horses, and hanging out. We’ll see what happens when he hits his teens.

Comment by Mike in Miami
2011-07-28 11:03:18

The high property taxes is what typically kills you even if the place is paid off. If you’re income is low but your house is reasonably nice the property tax will kill you.
On that note, Hawaii and Lousiana have the lowest property taxes in the US. Hawaii is super nice (been there), paradise really. What kills it is that the state is flat broke and desperate, like Clownifornia. Who knows what they are going to do to squeeze more money out of the tax donkeys.
Lousiana,…well maybe. I drove through there once…not sure. I used to live in Durham, NC. Nice but defnitely not low on taxes. 7% sales and income tax plus about 1% anual property tax.

Comment by drumminj
2011-07-28 11:58:24

Everything else is just good food, shooting, riding horses

talk about expensive hobbies, though…

Comment by X-GSfixr
2011-07-28 12:26:18

We caught crawdads on my grandparents farm in Oklahoma. Kite string and a little sliver of bacon. Didn’t know that you could eat them, so we were catch and release.

All the crawdads were red, evidently from swimming in Oklahoma Red pond water.

Nothing like trying to catch fish in the shadeless, broiling Oklahoma summer. Especially when you aren’t catching anything, except bug bites.

Every summer, you could hear the thunder, even when there wasn’t a cloud in the sky. Eventually figured out that we were hearing the guns firing over at Fort Sill……we were about 40 miles away. This was in the late 60’s. One summer, we got a real treat, when the seismic crew from the oil company set off some charges on the farm for a week or two.

You know, the more I look back, the more I realize my childhood sucked……. :)

Comment by Carl Morris
2011-07-28 12:47:03

talk about expensive hobbies, though…

Not when you do it the redneck way. There is some expense in maintaining the horses, but nothing like “horsey people” horse expenses. The shooting only costs as much as you choose to let it cost. Mom makes the food, some of it coming from shooting stuff.

Comment by wmbz
2011-07-28 04:59:43

D.R. Horton Quarterly Profit Beats Estimates as Home-builder Reduces Costs (Bloomberg)

D.R. Horton Inc., the second-largest U.S. home-builder by revenue, reported a third-quarter profit that beat analysts’ estimates as the company cut costs.

Net income for the three months ended June 30 was $28.7 million, or 9 cents a share, compared with $50.5 million, or 16 cents, a year earlier, the Fort Worth, Texas-based company said in a statement today. Analysts expected a profit of 6 cents a share, the average of 18 estimates compiled by Bloomberg.

D.R. Horton, led by Chief Executive Officer Donald Tomnitz, has been lowering expenses and shifting its focus to move-up buyers amid the U.S. housing slump. The company reduced selling, general and administrative costs by 21 percent in the third quarter from the previous year as revenue declined.

“Market conditions in the home-building industry are still challenging,” Chairman Donald R. Horton said in the statement. “We continue to focus on providing new homes and communities for both first-time and move-up buyers, controlling our construction costs, SG&A and inventory levels and maintaining our strong balance sheet and liquidity.”

Comment by edgewaterjohn
2011-07-28 08:09:19

“The company reduced selling, general and administrative costs by 21 percent”

Why can’t they just say layoffs?

Comment by Arizona Slim
2011-07-28 09:13:15

Why can’t they just say layoffs?

Because “layoff” is such a harsh-sounding word.

Comment by X-GSfixr
2011-07-28 09:58:23

“Right-sizing the workforce”

“Trimming excessive capacity”

“Optimizing the headcount”

Maybe Hitler needed to hire a HR department, to give the Holecaust some “sugarcoating”.

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Comment by In Colorado
2011-07-28 11:44:58

“Maybe Hitler needed to hire a HR department, to give the Holecaust some “sugarcoating”.”

In todays news, a tin pot dictator announced another round of “ethnic rebalancing”.

Comment by X-GSfixr
2011-07-28 12:31:05

“Un-diversifying the work force”

“Slave labor…….what it lacks in pay and workers rights, it makes up for with job security”

“Zee slaves vill be happy mit their pay und verking conditions………or zey vill be LIQUIDATED!”

Comment by Carl Morris
2011-07-28 12:48:32

In todays news, a tin pot dictator announced another round of “ethnic rebalancing”.

Ethnic right-sizing?

Comment by In Colorado
2011-07-28 13:26:47

“Zee slaves vill be happy mit their pay und verking conditions………or zey vill be LIQUIDATED!”

In which case being terminated doesn’t mean being dejobbed.

Comment by ecofeco
2011-07-28 14:06:37

Maybe Hitler needed to hire a HR department, to give the Holecaust some “sugarcoating”.

He did. His name was Goebbels. It’s how they got away with it for so long.

Comment by wmbz
2011-07-28 05:18:22

“The one thing that the national debt-ceiling has never done is to put a ceiling on the rising national debt. Time and time again, for years on end, the national debt-ceiling has been raised whenever the national debt gets near whatever the current ceiling might be”.

“Regardless of what it is supposed to do, what the national debt-ceiling actually does is enable any administration to get all the political benefits of runaway spending for the benefit of their favorite constituencies — and then invite the opposition party to share the blame, by either raising the national debt ceiling, or by voting for unpopular cutbacks in spending or increases in taxes.”

Article: Debt-ceiling Chicken By Thomas Sowell

Comment by combotechie
2011-07-28 05:40:45

“The one thing the national debt-ceiling has never done is put a ceiling on the rising national debt.”

That’s because they keep raising the ceiling. Which - until recently - used to routine.

But not this year. That’s because this year there is a fight over the issue. There should be a fight over the issue EVERY year but there hasn’t been - until now.

There is a message here for anyone who cares to ponder a bit.

Comment by Darrell_in_PHX
2011-07-28 07:08:31

But the fight to cut future deficits has been lost. Now it is a fight over how much we increase the limit? Enough to get us 18 months, or only 9 months?

Do we want to do this again during the height of election season, or do we want to put this off until after the next election.

All the big “grand bargain”, “Gang of 6″… real spending cuts and tax increase proposals are off the table.

Comment by GH
2011-07-28 21:33:10

We cannot meet our current obligations without ever increasing debt.

If we were individuals our credit score would be around 600 reflecting our maxed out cards and we would be good candidates for bankruptcy.

If granny is to continue receiving her Social Security check, we are counting on the Chinese to make that payment!

I somehow doubt they care if granny gets a penny as long as they believe they will be repaid with interest, but I somehow suspect they are starting to think we will print their payment and send it in a shrinking envelope.

It would help if we had a vibrant economy, but that hardly seems possible.

It is my understanding that we will be at some 35 trillion in debt by 2022 (assuming anyone is stupid enough to loan us that much). The number may well be higher if tax revenues fall as I suspect they will by half!

Comment by wmbz
2011-07-28 05:21:21

Foreclosure Filings Decline in 84% of U.S. Cities
By Dan Levy - Jul 28, 2011 (Bloomberg)

Foreclosure filings dropped in 84 percent of the largest U.S. cities in the first half of the year as paperwork delays and a glut of seized properties slowed the repossession of homes, according to RealtyTrac Inc.

Notices of default, auction and home seizure fell in 178 of the nation’s 211 biggest metropolitan areas, the Irvine, California-based data seller said today in a report. Cities in judicial states, where courts supervise the foreclosure process, showed the biggest declines from a year earlier.

Foreclosure notices have dropped amid a probe by all 50 state attorneys general into “robo-signing,” the practice by lenders and servicers of pushing through documents without verifying their accuracy. RealtyTrac expects about 2 million foreclosure filings this year, down from a January forecast of as many as 3.2 million.

“The foreclosure pipeline continues to be clogged in many local markets across the country, sometimes by a glut of already-foreclosed properties that are not selling quickly, sometimes by a mountain of improperly filed foreclosures that are blocking the inflow of new foreclosure filings — and sometimes by both,” RealtyTrac Chief Executive Officer James J. Saccacio said in the report.

Comment by Professor Bear
2011-07-28 08:17:49

Important question: How does the change in foreclosure filings stack up against the number of homes with mortgages in default? ‘Knowing’ the lender is unlikely to foreclose for, perhaps, a period of years would seem to increase the incentives for a strategic default.

At any rate, the MSM seems very fond of dwelling on the number of recent foreclosure filings, while ignoring the implicit number of future foreclosure filings due to owner-occupants who have stopped making payment.

Comment by ecofeco
2011-07-28 14:09:54

“RealtyTrac EXPECTS about 2 million foreclosure filings this year, down from a January FORECAST of as many as 3.2 million.”</I.

So… it’s really an imaginary number that dropped from what was an imaginary number to begin with?

I HATE this kind of yellow journalism!

Comment by wmbz
2011-07-28 05:38:38

JOBLESS WEEK: 398,000…

Comment by In Colorado
2011-07-28 08:59:53

398K? Break out the bubbly! Happy days are here again!

Comment by ecofeco
2011-07-28 14:11:32

Gonna gets me a 40 and celebrate wit cha!

Comment by jeff saturday
2011-07-28 05:44:56

School board tentatively approves $2.3 billion budget that raises teacher salaries, cuts 100 jobs — and draws no comment

By Jason Schultz Palm Beach Post Staff Writer
Posted: 8:48 p.m. Wednesday, July 27, 2011

The Palm Beach County School Board tonight tentatively approved a $2.3 billion budget for the upcoming year that would give teachers a raise and add teaching positions at elementary schools but leave almost 100 employees out of work.

And no one showed up to comment on it.

http://www.palmbeachpost.com/news/schools/school-board-tentatively-approves-2-3-billion-budget-1662492.html - -

Comment by ecofeco
2011-07-28 14:13:03

As I’ve said, people want to blame the the schools for being crappy, yet won’t even participate at the local level where the real power and control is.

Comment by GH
2011-07-28 21:35:42

I suspect no one showed because they KNOW they will be ignored.

The only way to cap this monster is by starving it.

Comment by Realtors Are Liars®
2011-07-28 05:53:42

Realtors Are Liars®

Comment by liz pendens
Comment by jeff saturday
2011-07-28 07:05:39

Realtors Change Their Stories

ORLANDO, Fla. — Police said a woman faces first-degree murder charges in connection to the death of her boyfriend.

Sgt. Vincent L. Ogburn said officers responded to a shooting at 918 West Smith Street after a 5 a.m. call Wednesday to 911.
The operator said the woman who called 911, Caryn Kelley, was angry and agitated from the minute she called.
Police officers said Kelley answered the door of the College Park home and was very upset when she let them inside.
“While checking the house they located a body, a male, was deceased; he had been shot (in the master’s bedroom),” Ogburn said. “A weapon was found at the scene it was unknown whose gun it was at this point and time.”
The man has now been identified as Phillip Peatross, 46, and police confirmed he was in a relationship with Kelley.
Peatross ran a pool construction business, and Kelley was a realtor, officers said.
Police said Kelley got into a fight with Peatross Tuesday night after drinking. Detectives said she then grabbed a gun and shot him.
Investigators said that Kelley changed her story several times about exactly how Peatross wound up shot dead.
At first, Kelley said she shot her live-in boyfriend in self defense, then told officers they struggled over the gun, and it went off.
Police said Kelley changed her story again, saying, “He (Peatross) shot himself.”
But detectives said they couldn’t believe Peatross turned a handgun on himself.
Investigators said that Kelley had blood on both of her hands, wreaked of alcohol and had slurred speech.
Detectives said that Kelley admitted that she told her boyfriend, “If he left, not to come back, because she had a gun and would use it.”
Officers said Kelley’s statement adds up to premeditated murder.
Kelley is set to see a judge Thursday morning, officers said.

Comment by liz pendens
2011-07-28 10:26:10

The classic symbolic Realtor with blood on her hands.

…and lying about it.

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Comment by Realtors Are Liars®
2011-07-28 13:02:56

“The classic symbolic Realtor with blood on her hands.

…and lying about it.”

Did you expect anything other than?

Comment by rms
2011-07-28 07:02:07

Realtors are millionaires

Comment by jeff saturday
2011-07-28 05:57:01

BofA Donates Then Demolishes Houses to Cut Glut of Foreclosures

By Lindsey Rupp -
Jul 27, 2011 10:43 AM ET

Bank of America Corp. (BAC), faced with a glut of foreclosed and abandoned houses it can’t sell, has a new tool to get rid of the most decrepit ones: a bulldozer.

The biggest U.S. mortgage servicer will donate 100 foreclosed houses in the Cleveland area and in some cases contribute to their demolition in partnership with a local agency that manages blighted property. The bank has similar plans in Detroit and Chicago, with more cities to come, and Wells Fargo & Co. (WFC), Citigroup Inc. (C), JPMorgan Chase & Co. (JPM) and Fannie Mae are conducting or considering their own programs.

Disposing of repossessed homes is one of the biggest headaches for lenders in the U.S., where 1,679,125 houses, or one in every 77, were in some stage of foreclosure as of June, according to research firm RealtyTrac Inc. of Irvine, California. The prospect of those properties flooding the market has depressed prices and driven off buyers concerned that housing values will keep dropping.

“There is way too much supply,” said Gus Frangos, president of the Cleveland-based Cuyahoga County Land Reutilization Corp., which works with lenders, government officials and homeowners to salvage vacant homes. “The best thing we can do to stabilize the market is to get the garbage off.”

http://www.bloomberg.com/news/2011-07-27/bank-of-america-donates-then-demolishes-houses-to-get-rid-of-foreclosures.html - 95k -

Comment by aNYCdj
2011-07-28 06:34:59

Just wait til they get around to FloorRiddahhhh i predicted at least 50-100,000 would have to be demolished….mold vermin and that nasty Chinese drywall after being enclosed for a year or two or three in the hot humid south

Comment by Ol'Bubba
2011-07-28 07:11:46

Have you spent much time in Florida, dj?

Comment by aNYCdj
2011-07-28 11:54:46

No but why aren’t they actively putting the homeless and section 8 in them… why should there be a waiting list if FL has so many abandoned houses?

Whats the holdup?

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Comment by Ol'Bubba
2011-07-28 12:54:49

It’s better to stay silent and look a like a fool, rather than speak and remove all doubt. - Mark Twain

Comment by ecofeco
2011-07-28 14:15:28

Congrats to those of you who predicted this.

Comment by jeff saturday
2011-07-28 06:00:19

BofA Donates Then Demolishes Houses to Cut Glut of Foreclosures

By Lindsey Rupp -
Jul 27, 2011 10:43 AM ET

Unwanted Homes

“No one needs these homes, no one is going to buy them,” said Christopher Thornberg, founding partner at the Los Angeles office of Beacon Economics LLC, a forecasting firm. “Bank of America is not going to be able to cover its losses, so it might as well give them away and get a little write-off and some nice public relations.”

Donating a house may create an income-tax deduction, said Robert Willens, an independent accounting analyst based in New York. A bank might deduct as much as the fair market value if a home wasn’t acquired with the explicit intent of knocking it down, he said.

Wells Fargo and Fannie Mae already started donating houses and demolition funds in Ohio. San Francisco-based Wells Fargo, the biggest U.S. home lender, gave 26 properties and $127,000 to the Cuyahoga land bank, said Russ Cross, Midwest regional servicing director for Wells Fargo Home Mortgage. Since 2009, Wells Fargo made more than 800 donations, the bank said.

Comment by oxide
2011-07-28 07:48:09

A bank might deduct as much as the fair market value

And that fair-market value is…?

Comment by Professor Bear
2011-07-28 07:55:53

They don’t know, because they did not try to sell them at a price the market would bear.

Comment by oxide
2011-07-28 08:39:03

No really, what is the fair market value? Hopefully NOT the value they have on their books. What formula does the Salvation Army use when you get a receipt for your junk?

We need a Kelly Blue Book for houses…

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Comment by Professor Bear
2011-07-28 08:43:25

Fair market value is a difficult concept for homes that are not selling. The problem has to do with liquidity: When prices fall, owners try to avoid selling at a loss (especially lenders with artificially-inflated book values to protect), and with no sales, there is no evidence on what the fair market value actually is, beyond hearsay.

You may recall a similar situation arose a few years back, when the market for MBS crashed hard and none was selling. Warren Buffett made the suggestion that to figure out the market value, owners of MBS would have to test the market by selling some. I don’t think anyone in high finance took his suggestion.

Comment by ecofeco
2011-07-28 14:18:42

“We need a Kelly Blue Book for houses…”

RE is pretty much legalized “horse trading.”

Your best defense is the country tax records and knowing the difference between “good repair” and not, i.e. house construction.

Comment by GH
2011-07-28 21:37:40

That would be 2006 value!

Probably a lot more valuable as a tax write off than a home!

Comment by Professor Bear
2011-07-28 07:52:23

“…no one is going to buy them,”

Did they try a no-reserve-price auction? Because seriously, folks, there often is a price at which somebody will buy something which remains undiscovered until the market is tested.

I can’t believe a big-name economist like Thornberg doesn’t get it.

Comment by X-GSfixr
2011-07-28 09:03:56

What economist never figure into the equation, is that there are many things that will not sell unless the seller gets what he considers to be a “fair” price. Even if the item in question eventually becomes worthless.

Example: I had a car that needed some work, but I didn’t have the time/place to work on it. Offered it for sale locally, at essentially the cost of all the parts I’d purchased to fix it.. All I got was “10 cent on the dollar” lowballers/car flippers. Pi$$ed me off so bad, I held onto the car, and finished it. Now, I might sell it (maybe) if someone waves a $20K check in front of me.

Comment by ecofeco
2011-07-28 14:20:32

eCONomists always mistake the map for the terrain.

Comment by jeff saturday
2011-07-28 06:05:26

No home building rebound until 2014: Fed paper

CHICAGO | Mon Jul 25, 2011 1:08pm EDT

(Reuters) - Home building likely won’t return to normal levels until 2014, and then only if housing prices rebound and foreclosures drop sharply, research from the San Francisco Federal Reserve Bank showed.

“Our analysis suggests that even an unusually strong period of real house price appreciation would not, on its own, lift starts to long-run average levels,” the researchers wrote in the regional Fed bank’s latest Economic Letter. “A significant easing of the drag on housing stemming from the inventory of foreclosed homes is also needed.”

Foreclosures would need to drop by 50,000 homes per quarter starting in 2012, the researchers found, and home prices would need to stop falling by 2013 and then begin to rise, for housing starts to return to pre-2004 levels by 2014.

http://www.reuters.com/article/2011/07/25/us-usa-fed-housing-idUSTRE76O4CM20110725 - 92k -

Comment by Kim
2011-07-28 13:05:42

“Home building likely won’t return to normal levels until 2014, and then only if housing prices rebound and foreclosures drop sharply”

Lower existing house prices and someone is bound to tear a few down and put some home builders back to work (at the very least, they’ll find work doing renovations).

Comment by ecofeco
2011-07-28 14:24:49

This is how the housing boom took off in my city in the late 1990s.

1K shotgun shacks setting on 80K land getting demolished to build 250k townhouses and selling within 3 months of completion.

I knew several “overnight” millionaires. I missed out from lack of money.

Comment by jeff saturday
2011-07-28 06:11:25

I hope this link works. Have a nice day. :)

Real Estate Downfall‏ - YouTube

The Housing Bubble bursts on a speculator. Parody using a clip with Hitler as the real estate investor. He bought a house to flip, …

http://www.youtube.com/watch?v=bNmcf4Y3lGM - 133k -

Comment by michael
2011-07-28 07:23:26

he really gets pissed when they cancel his xbox subscription.

Comment by jeff saturday
2011-07-28 07:59:22

I posted this youtube clip in reponce to comments by 4closureFraud.org on the Palm Beach County foreclosure filings fall 41% article 6:40 a.m. Thursday, July 28, 2011 That should draw fire.

4closureFraud.org comments
Florida AG Pam Bondi seems to think her first duty is to protect some of Gov. Scott’s biggest corporate pals – the banks – instead of hard working Floridians. Recently Bondi fired Florida’s two leading attorneys investigating the epidemic of foreclosure fraud ravaging our communities.

Join me and sign this petition calling for an immediate investigation:

7:13 AM, 7/28/2011

Comment by ecofeco
2011-07-28 14:26:42

“Florida AG Pam Bondi seems to think her first duty is to protect some of Gov. Scott’s biggest corporate pals – the banks – instead of hard working Floridians.”

You mean it NOT?! But that’s just socialeest commie talk!

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Comment by Bill in Carolina
2011-07-28 06:39:50

HUNTSVILLE, Ala. (July 26, 2011) — Data from NASA’s Terra satellite shows that when the climate warms, Earth’s atmosphere is apparently more efficient at releasing energy to space than models used to forecast climate change have been programmed to “believe.”

The result is climate forecasts that are warming substantially faster than the atmosphere, says Dr. Roy Spencer, a principal research scientist in the Earth System Science Center at The University of Alabama in Huntsville.

“The satellite observations suggest there is much more energy lost to space during and after warming than the climate models show,” Spencer said. “There is a huge discrepancy between the data and the forecasts that is especially big over the oceans.”


Comment by palmetto
2011-07-28 06:54:36

Yeah, well, there’s no denying that summers have become hotter and more humid here in FLA. At least it feels that way to me. I say it’s too many people. I am not a scientist. Just an observer who can see and feel. Wish some of that heat would get released into the ethers a whole lot faster.

This area is really turning into one big congested sh8thole. Courtesy of the bubble.

Comment by Ol'Bubba
2011-07-28 07:13:56

Palmy- are you still in Pinellas County?

Comment by palmetto
2011-07-28 08:59:12

Hillsborough. After decades of being Hillsborough County’s redheaded stepchild and dumping ground for unwanted industry and projects, it’s like everyone decided to move to South Hillsborough. All at once. Like I said yesterday, we really got hit with the ugly stick down here.

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Comment by Ol'Bubba
2011-07-28 11:38:07

I always preferred Pinellas to Hillsborough. Pinellas seemed more laid back and civil than Hillsborough (at least in the 1990’s).

Comment by ecofeco
2011-07-28 14:31:11

Then why is it still getting hotter each summer?

There’s something fishy about this article.

Comment by wmbz
2011-07-28 06:52:56

Neighbors Make Trash Deposit At SJ Bank In Protest Of Blighted Foreclosure

SAN JOSE (CBS 5) – About a dozen concerned members of a neighborhood group came to the Wells Fargo Branch at Story Rd. and King Rd. in San Jose Wednesday carrying trash bags instead of money sacks.

Protesters left the waste inside the bank lobby as managers rushed to call police. The trash dumped Wednesday was collected at blighted Bank-owned property connected to Wells Fargo.

The group hoped the protest would spur the bank to clean up a home on Sinbad Ave.

The group eventually left without arrests being made.

Wells Fargo claimed that the were not responsible for the upkeep of the home on Sinbad Ave. CBS 5′s Len Ramirez confirmed that the property is currently being handled by Bank of America.

The City of San Jose says that Wells Fargo has generally been responsible with most of the foreclosed properties it handles.

Comment by Darrell_in_PHX
2011-07-28 07:31:58

Ooops… wrong big bank. How embarassing for the protesters.

Comment by jeff saturday
2011-07-28 08:04:55

“Ooops… wrong big bank. How embarassing for the protesters.”

Banks, property managers may have to post contact info on foreclosed properties in Palm Beach County

By Jennifer Sorentrue Palm Beach Post Staff Writer
Posted: 6:36 a.m. Thursday, July 28, 2011

Banks and property managers responsible for maintaining thousands of foreclosed homes soon may have to post their names, phone numbers and email addresses on the properties so neighbors can make complaints.

Palm Beach County commissioners will consider a law today that would require notices on the front of all abandoned and foreclosed homes in the unincorporated areas. Under the proposal, the notices must measure 18-by-24 inches and be legible 45 feet away.

The requirements are part of a broader proposal that would force banks and owners of foreclosed properties to register with the county.

http://www.palmbeachpost.com/money/foreclosures/those-responsible-may-have-to-post-contact-information-1664738.html - -

Comment by liz pendens
2011-07-28 07:35:05

They should follow up by bringing a few five-gallon buckets of roaches and rats to dump out in the lobby.

Comment by Arizona Slim
2011-07-28 09:17:02

Remember that late 1960s/early 1970s protestor called The Fox?

Guy who wore a suit and a mask. His M.O. was to dump buckets of polluted water in the lobbies of companies that polluted rivers. ISTR that he got his name from the Fox River, which was quite polluted at the time.

AFAIK, The Fox was never caught.

Comment by wmbz
2011-07-28 06:55:57

Obama ‘Unpresidential,’ ‘Petulant’ ‘Dividing Us’: Langone
Thursday, 28 Jul 2011 |By: Jeff Cox
CNBC.com Staff Writer

President Barack Obama’s conduct during the debate over the debt ceiling has divided the country and will inflict damage that will last well after the battle is over, former New York Stock Exchange director and Wall Street stalwart Ken Langone said.

While he believes a debt deal will get done and in fact favors a plan closer to what the Democrats are proposing, Langone told CNBC that Obama’s behavior has been “un-presidential.”

“He is dividing us as a nation,” Langone said. “He’s not bringing us together. He’s willfully dividing us. He’s petulant.”

The co-founder of Home Depot sharply criticized the president for promoting class warfare through his repeated attacks against “fat cat” business executives and his targeting of tax loopholes.

In sum, the behavior is symptomatic of Obama’s disrespect for the office he holds, Langone said.

Comment by Darrell_in_PHX
2011-07-28 07:30:25

How dare Obama speak to the American people and explain that the Republicans want to fix the deficits on spending cuts alone while the Democrats want a shared sacrifice of spending cuts and tax increases.

He’s just talking his book. Obama has been very successful at convincing people that we need tax increases on the rich, and Langone is not happy about that.

Comment by ecofeco
2011-07-28 14:33:25


Comment by Hwy50ina49Dodge
2011-07-28 07:47:28

Jib-Jab / ping-pong / teeter-totter: ;-)

filed under: “I like you, its just that I like your sister more…”

GOPOFC&CC = “The Grand Old Pimp of Fiscal Conservatives & Compassionate Conservatives” rode the white-horse pumpkin carriage to the election ball and danced ’till the witching hour with the 3 headed Sisters “TrueAnger!™” + “TrueReducetheDeficitNow! Today!!™” + “TrueEvangelicals!™” …the bell is tolling…x1 ringy dingy, x2 ringy dingy…

Tea Party favorite blasts McCain for ‘hobbit’ rebuke:
By Catalina Camia, USA TODAY

McCain laced his remarks with quotes from a Wall Street Journal article, which referred to the anti-tax movement supporters as “Tea Party hobbits”

He specifically accused Angle and Christine O’Donnell, the Delaware Senate nominee backed by the Tea Party, for “crack political thinking.

Tea Party founder Judson Phillips blasts John Boehner:
By REID J. EPSTEIN | 7/28/11

Phillips, a former Tennessee district attorney who founded Tea Party nation as a for-profit entity in 2009, pushed back against criticism Tea Party-aligned members of Congress are responsible for the debt ceiling crisis.

Phillips also blasted freshman Republicans for not living up to campaign promises to enact — or at least propose and pass in the House — legislation to drastically cut federal government spending.

heheeeheeeheehaahaaahaaheeehaahaaa… (Hwy50™)

Comment by Arizona Slim
2011-07-28 09:18:46

The co-founder of Home Depot sharply criticized the president for promoting class warfare through his repeated attacks against “fat cat” business executives and his targeting of tax loopholes.

The co-founder of Home Cheapo has zero cred with me. That place is the Walmart of the building materials industry.

Comment by In Colorado
2011-07-28 11:41:56

“He is dividing us as a nation,” Langone said. “He’s not bringing us together. He’s willfully dividing us. He’s petulant.”

Says the man who’s paid hundreds (if not thousands) of times more than his average employee.

Comment by X-GSfixr
2011-07-28 12:34:59

No, you jackasses on Wall Street and sitting in the executive suites and on Company boards “divided us as a nation”.

Obama is just pointing out what should be obvious to everyone by now.

Comment by ecofeco
2011-07-28 14:35:31

“The co-founder of Home Depot sharply criticized the president for promoting class warfare through his repeated attacks against “fat cat” business executives and his targeting of tax loopholes.”

The psychopath always blames the victim.

Comment by CarrieAnn
2011-07-28 07:13:13

Lots of big reductions this week on the local front. It’s almost like the sellers are getting spooked. ;)

Comment by Hwy50ina49Dodge
2011-07-28 07:33:05

School starts end of August,..1st weeks of September right?

Today: July 28th

Comment by CarrieAnn
2011-07-28 07:34:56

Yes but there’s also a lot of inventory coming in the last two weeks and that is NOT normal for this point in the summer.

Comment by Kim
2011-07-28 12:51:26

Based on my observations for my area, if you need a mortgage in order to buy, you’re looking at two-to-three months from contract to closing. At this point you’d have to be a cash buyer in order to be in by the time school starts.

Comment by edgewaterjohn
2011-07-28 08:14:15

Shhhh! I need the panic selling to hold off for another hour and a half. Then they can knock themselves out.

Comment by Darrell_in_PHX
2011-07-28 07:47:11

Well, the house across the street from me that went on the market at $77K….. I assumed that was a low ball listing by the bank hoping to create a bidding war….

WRONG! After 2 months on the market with no interest, the listing has been pulled by the bank. Hmmm…. put that one back into shadow inventory.

The condos at the end of the street that were going for $150K at the peak now languish on the market at… I kid you not… 2 are listed below $23K. $29 per sqft. Condo association fees would be more that PITI. The cheaper of the 2, $22,500, days on market: 50.

Comment by liz pendens
2011-07-28 08:10:25

What is with all of this “pulled by the bank” stuff? Isn’t the “bank” really Fannie/Freddie (ie: us). As a publicly-owned enitity, isn’t “the bank” obligated to sell the houses for what they can get before they (we) have to pay to have them bulldozed?


Comment by ecofeco
2011-07-28 14:37:15

But who would know this and report it to?

Comment by CarrieAnn
2011-07-28 08:18:04

(There’s a) provision that calls for buyers to put 20 percent down for a “qualified residential mortgage,” an idea critics say would mean higher interest rates for buyers who put down less.

Some Dodd-Frank reforms are already in place, but Congress left details of others to regulators. The down payment rule is currently in a “public comment” period that’s been extended to Aug. 1.

The proposal would split home loans into two categories. One would be loans to buyers who put 20 percent down, and lenders would face few regulatory hurdles bundling those loans to sell as investment securities. It was the volume of subprime loans in such securities that helped precipitate the financial crisis.

The other loan category would allow smaller down payments but would require lenders to maintain at least 5 percent of the total value of their loans so they shoulder part of the risk. The intent is to ensure lenders thoroughly vet borrowers.

Isakson and others believe the second category would be subject to higher interest rates and could shut lower-income buyers out of the market.

“Loan rates would go up 3 percent because of the scarcity of the loans,” said Isakson, who ran a real estate company in metro Atlanta before his days in Washington. “With the housing market in the shape it is, it’s just ridiculous.”

Alicia Blackshear, a recently divorced truck driver, has a loan in process to buy a Douglasville home with a 3.5 percent down payment. She said 20 percent down would be impossible, and that higher interest rates would make buying a home more difficult.

“If you are going to have to pay 20 percent down, you might as well go on and rent,” she said.


Comment by oxide
2011-07-28 09:09:36

“Loan rates would go up 3 percent because of the scarcity of the loans,” said Isakson,

Wrong. Loan rates on NON-QRM loans would go up. To which I say: it’s about damn time.

And what is this crap about “you may as well go and rent?” Not if house prices drop, you moron!

By the way, this regulation is the one I’ve been harping on to PLEASE go and comment on.

Comment by Neuromance
2011-07-28 17:13:40

Could you please post the link again?

Comment by CarrieAnn
2011-07-28 08:25:00

Poll Respondents Feel Americans Who Cannot Afford Homes Should Get Out
2011-07-27 — nationalmortgageprofessional.com

“According to a poll conducted by Rasmussen Reports, most Americans believe troubled homeowners should sell their homes rather than receive government assistance to keep them. The national telephone survey taken of American adults shows that 62 percent of respondents believe it’s better for homeowners who cannot afford to make increased mortgage payments to sell their homes and find less expensive ones. ”

Other key findings of the survey include:

►Those who don’t own a home are more supportive of government intervention than those that do own one.

►Republicans and adults not affiliated with either major political party feel strongly that homeowners who cannot afford their payments should sell their homes and buy less expensive ones. Democrats polled were evenly divided.

►While 39 percent of the political class favors the government assisting troubled homeowners, only seven percent of mainstream voters agree.

►Confidence that home values will improve has fallen to the lowest level ever recorded.

►The belief among Americans that purchasing a home is a family’s best investment is weaker than ever. More homeowners than non-owners now think home buying is not the best investment a family can make.


Comment by Professor Bear
2011-07-28 08:39:29

“Confidence that home values will improve has fallen to the lowest level ever recorded.”

Sounds like home values are going to keep going down.

Comment by Hwy50ina49Dodge
2011-07-28 08:58:33


Ye old trend sniffer

Elmer Fudd: “Were did dat wasscally wabbit go?”
Daffy (holding “wabbit season!” sign): “Down that tar hole, hurry!”

Comment by ecofeco
2011-07-28 14:39:21

And they will sell to… who, exactly? :lol:

Comment by wmbz
2011-07-28 08:30:36

Man, just gotta love The Goldman they never stop coming up with ways to screw over an industry. I’m sure they are getting a huge tax credit for operating these warehouses to boot.

ITEM: Goldman’s new money machine: warehouses

LONDON/DETROIT (Reuters) - In a rundown patch of Detroit, enclosed by a cyclone fence and barbed wire, stands an unremarkable warehouse that investment bank Goldman Sachs has transformed into a money-making machine.

The derelict neighbourhood off Michigan Avenue is a sharp contrast to Goldman’s bustling skyscraper headquarters near Wall Street, but the two operations share one important element: management by the bank’s savvy financial professionals.

A string of warehouses in Detroit, most of them operated by Goldman, has stockpiled more than a million tonnes of the industrial metal aluminum, about a quarter of global reported inventories.

Simply storing all that metal generates tens of millions of dollars in rental revenues for Goldman every year.

There’s just one problem: much less aluminum is leaving the depots than arriving, creating a supply pinch for manufacturers of everything from soft drink cans to aircraft.

The resulting spike in prices has sparked a clash between companies forced to pay more for their aluminum and wait months for it to be delivered, Goldman, which is keen to keep its cash machines humming and the London Metal Exchange (LME), the world’s benchmark industrial metals market, which critics accuse of lax oversight.

Analysts question why London’s metals market allows big financial players like Goldman to own the warehouses which store huge quantities of metal even as they trade the commodity. Robin Bhar, a veteran metals analyst at Credit Agricole in London says the conflict of interest is so acute he wants U.S. and European anti-trust regulators to weigh in.

“I think it makes a mockery of the market. It’s a shame,” Bhar said. “This is an anti-competitive situation. It puts (some) companies at an advantage, and clearly the rest of the market at a disadvantage. It’s a real, genuine concern. And I think the regulators have to look at it.”

Comment by In Colorado
2011-07-28 08:55:33

Goldman makes Communism look good by comparison.

Comment by X-GSfixr
2011-07-28 09:11:27

“…..much less aluminum is leaving the depots than arriving, creating a supply pinch……..”

But…but…..but…… I thought we were in a “free market economy” where a glut of supply/lack of demand caused prices to go down?

But, I am just a simple caveman…….

Comment by MrBubble
2011-07-28 13:43:39

You are gold today, X-GSF and so apropos:

“Keyrock became a defense and personal injury lawyer and, in a later sketch, a politician running for President on the platform of eliminating the capital gains tax He was portrayed as a selfish, well-dressed attorney who repeatedly claimed to be a simple-minded caveman, and would employ simple folk wisdom to win his cases. He also enjoyed significant wealth, driving luxury cars like BMWs and Range Rovers, as well as owning a home in Martha’s Vineyard.

RIP Phil Hartman. Too bad he’s not around to see Keyrocks everywhere…

Comment by ecofeco
2011-07-28 14:41:19

This was posted several months ago.

But it’s still a good example of supply and demand being a fairy tale.

Comment by Professor Bear
2011-07-28 08:30:41

While Congress continues to figure out how best to dole out austerity to most Americans, it seems like a useful time to revisit how the bailouts went down during the financial collapse of Fall 2008.

Federal Reserve’s Bailout of the Rich and Well-Connected
By Elizabeth MacDonald
Published December 07, 2010 | FOXBusiness

The conflicts of interest and policy controversies in the Federal Reserve’s bailout of the financial system now include helping out millionaires, billionaires, foreign automakers, and companies whose executives sit on the board of directors of the U.S. central bank.

General Electric (GE: 18.34, +0.24, +1.30%), JPMorgan Chase (JPM: 41.13, +0.46, +1.13%), Goldman Sachs (GS: 137.42, +2.70, +2.00%), Banco Popular, SunTrust Banks (STI: 24.90, +0.26, +1.03%) and Fifth Third Bank (FITB: 12.82, +0.12, +0.91%) received “hundreds of billions of dollars in low-interest Federal Reserve loans at the same time that senior executives at these institutions served on the Federal Reserve’s regional board of directors,” says Senator Bernie Sanders (Ind.-VT) in a letter to Federal Reserve chairman Ben Bernanke Monday.

Sanders backed a new clause in the Dodd-Frank financial reform bill that forced the Fed to disclose more than 21,000 transactions it entered into between Dec.1, 2007, and July 21, 2010, involving more than $3.3 trillion to float the financial system after it collapsed.

The bank executives who sit on the Federal Reserve’s board of directors include James Rohr of PNC Financial Services (PNC: 55.10, +0.60, +1.10%), Kelly King of BB&T (BBT: 25.95, +0.28, +1.09%), James M. Wells of SunTrust Banks, Dan Hogan of Fifth Third Bank, Jamie Dimon of JPMorgan Chase, and GE’s Jeffrey R. Immelt.

“It is an obvious conflict of interest when CEOs of banks and large corporations who serve on the Fed’s board of directors receive cheap loans from the Fed,” says Sanders in his letter.

Sanders is also demanding emails, phone logs and correspondence between the bailed out banks and the Federal Reserve.

“We have received the letter and plan to respond to it,” the Federal Reserve tells FOX Business.

The Fed’s new disclosures also show how the U.S. central bank dangerously became the supranational lender of last resort to both domestic and foreign companies, heightening deep concern in Washington that the central bank entered into a regulatory void with little to no help from foreign central banks.

The disclosures show in glaring, striking detail the profound absence of a global regulatory apparatus for dealing with a worldwide financial crisis involving large cross-border banks whose home countries have zero to no regulatory wind down authorities for their banking systems.

Banks worldwide tapped into the Federal Reserve’s emergency lending programs more than 4,200 times for a total of $3.8 trillion, estimates show.

Senator Sanders’ staff found that “several billionaires and tens of multi-millionaires received cheap loans from the Fed to invest in securities backed by auto, mortgage, credit card, student and mortgage loans,” Sanders’ letter says. That Fed program is called the Term Asset-backed Securities Loan Facility.

Comment by In Colorado
2011-07-28 08:43:43

“While Congress continues to figure out how best to dole out austerity to most Americans”

I thought that was a done deal: balance the budget on the backs of the lower and middle classes while protecting tax breaks for the wealthiest Americans.

Comment by Hwy50ina49Dodge
2011-07-28 09:38:54

“balance the budget on the backs of the going still lower and dwindling middle classes while protecting tax breaks Gift$ for the wealthie$t Americans.”

what Hwy’s eyes…read. ;-)

A plan is a plan, seems to cover every one in America, paid repre$entative democracy at work!

Comment by measton
2011-07-28 09:40:13

It boggles my mind that people can see stories like this or stories about corporations paying zero taxes or elite paying very low effective tax rates and still support any politician that says only the middle class and poor should be forced to pay.

Comment by Hwy50ina49Dodge
2011-07-28 09:56:31

Where’ve you been? ;-)

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Comment by In Colorado
2011-07-28 11:51:11

Exactly. There’s no shortage of low wage folks who are ready to bend over to balance the budget and who won’t even hear about raising taxes on the wealthy.

Comment by Happy2bHeard
2011-07-28 21:40:26

God bless Bernie Sanders!

Comment by liz pendens
Comment by Hwy50ina49Dodge
2011-07-28 08:46:30

$torage! $torage! $torage!

It’s not anti-competitive, it’s that we’re $mart, and your not! a collective bunch of paying peon$. ;-)

“I think it makes a mockery of the market.”

Goldman’s warehouse business relies on a lucrative opportunity enabled by the LME regulations. Those rules allow warehouses to release only a fraction of their inventories per day, much less than the metal that is regularly taken in for storage.

The metal that sits in the warehouse generates lucrative rental income.

The long delays in metal delivery have buyers fuming. Some consumers are waiting up to a year to receive the aluminum they need and that has resulted in the perverse situation of higher prices at a time when the world is awash in the metal.

Also pushing aluminum costs higher are bank financing deals, which are estimated to have locked up about 70 percent of the 4.4 million tonnes of the metal sitting in LME-registered warehouses around the world. ME inventories hit an all-time record above 4.7 million tonnes in May.

The LME says the current maximum rent, set by warehouse operators, is 41 U.S. cents per day per tonne. At that rate, Goldman’s warehouse operation in Detroit — said to be holding more than 1.1 million tonnes — could be generating as much as $451,000 per day or about $165 million a year in revenue.

“These f@!king Guys!,” Jon Stewart.

Comment by Carl Morris
2011-07-28 09:01:57

Some consumers are waiting up to a year to receive the aluminum they need and that has resulted in the perverse situation of higher prices at a time when the world is awash in the metal.

Something smells like Enron in here…

Comment by Hwy50ina49Dodge
2011-07-28 09:09:23

“Goldman said its warehouse subsidiary Metro International Trade Services has done nothing illegal, and abides by the LME’s warehousing rules. “Producers have chosen to store metal in Detroit with Metro,” a Goldman spokeswoman said.”

Goldenman$ucks Inc. (SCOTU$ person): “Bidne$$ is Bidne$$, …besides, we’re “Indemnified”

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Comment by ecofeco
2011-07-28 14:44:06

“Something smells like Enron in here…”

Damn GOOD analogy!

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Comment by Arizona Slim
2011-07-28 09:22:23

True story: My aunt saw the Hindenburg just a few minutes before it crashed.

She was at school, and the father of one of her classmates worked for the company that handled the Hindenburg (and other craft like it) over in Lakehurst, NJ. That classmate’s dad arranged to have the Hindenburg fly over the school.

Aunt Jean wasn’t told the story of what happened next until she got home from school.

Comment by liz pendens
2011-07-28 10:22:42

Too bad your aunt didn’t have her iPhone that day for a pic for her Facebook.

The Hindenburg was the safest fastest way to travel at the time. Our banking system is the most stable, trusted in the World.

…all it takes is a tiny spark…

Comment by Arizona Slim
2011-07-28 14:28:09

Too bad your aunt didn’t have her iPhone that day for a pic for her Facebook.

Don’t get my aunt started re: Facebook. Just don’t.

Numerous relatives have tried to get her to sign up. But she thinks it’s just a time-sucking waste.

She’d rather paint a picture. Or do community volunteer work. Or tend to her garden. Or schmooze with friends and family.

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Comment by Carl Morris
2011-07-28 14:38:07

Or schmooze with friends and family.

Which is where Facebook comes in, at least if you’ve all had to move far apart from each other for jobs.

Comment by Arizona Slim
2011-07-28 15:49:37

Which is where Facebook comes in, at least if you’ve all had to move far apart from each other for jobs.

Not in my family.

We may be separated by distance, but we’re still talkers. It’s that old Celtic storytelling tradition. You have to tell stories orally, rather than by writing them.

BTW, the long distance talking and storytelling requirement is why I have VoIP. Free long distance.

Comment by wmbz
2011-07-28 08:36:57

Appears even “free” health care has to be paid for. I guess blind granny will have to lip along for now.

Cataracts, hips, knees and tonsils: NHS begins rationing operations
Almost two-thirds of trusts affected as cuts bite
By Oliver Wright, The Independent UK 28 July 2011

Hip replacements, cataract surgery and tonsil removal are among operations now being rationed in a bid to save the NHS money.

Two-thirds of health trusts in England are rationing treatments for “non-urgent” conditions as part of the drive to reduce costs in the NHS by £20bn over the next four years. One in three primary-care trusts (PCTs) has expanded the list of procedures it will restrict funding to in the past 12 months.

Examples of the rationing now being used include:
Related articles

* Hip and knee replacements only being allowed where patients are in severe pain. Overweight patients will be made to lose weight before being considered for an operation.

* Cataract operations being withheld from patients until their sight problems “substantially” affect their ability to work.

* Patients with varicose veins only being operated on if they are suffering “chronic continuous pain”, ulceration or bleeding.

* Tonsillectomy (removing tonsils) only to be carried out in children if they have had seven bouts of tonsillitis in the previous year.

* Grommets to improve hearing in children only being inserted in “exceptional circumstances” and after monitoring for six months.

* Funding has also been cut in some areas for IVF treatment on the NHS.

The alarming figures emerged from a survey of 111 PCTs by the health-service magazine GP, using the Freedom of Information Act.

Doctors are known to be concerned about how the new rationing is working – and how it will affect their relationships with patients.

Comment by Arizona Slim
2011-07-28 09:24:35

Here in the good old USA, we have rationing based on the ability to pay.

Comment by frankie
2011-07-28 11:00:58

There are other options;


How long will I have to wait?
The Government says no one should wait more than six months for any operation. Although orthopaedic surgeons are still the ones with the longest lists, the situation has vastly improved in the past three years.

The latest figures show that of the 197,492 people waiting for an orthopaedic operation (not all of these will be hips), just under half will have waited up to two months and only 10,797 will have waited five months or more.

What about private treatment?
Going privately will eliminate the wait, but costs are high. You can expect to pay between £7,500 and £11,000 for one new hip, depending on the type of joint; resurfacing costs slightly more, usually up to £12,000.

BUPA carries out 3,000 hip operations a year, and charges between £7,500 and £9,400 for a hip replacement. Private medical insurance will generally cover you.

Check how many hip operations the surgeon carries out each year - the more the better. Patients often prefer to go to a hospital which has intensive care facilities in case anything goes wrong.

Is going abroad a good idea?
It can be. In Europe, surgeons prefer the minimally invasive technique, which leaves you with a much smaller scar.

A hip replacement with high quality joints and minimally invasive surgery costs around £6,000 in France, just over half that of private care in the UK.

If you do opt for surgery abroad, doctors advise finding out as much as possible about the surgeon, the hospital and the operation beforehand - writing down any questions you want to ask. It’s also vital to get your GP ‘on side’ - and your specialist too if possible - so that your notes can be sent to the foreign doctor. Also ask what arrangements are in place if things go wrong.

Comment by measton
2011-07-28 09:44:05

This is EXACTLY the way it should be.
Health care based on cost benefit analysis and rationed to those that really need it.
If you want more then buy an insurance plan or pay out of pocket or enroll in a study.

Slim is right, in the US we ration based on ability to pay. We allow insurance companies to dump expensive patients. Even upper middle class and rich can end up broke quickly when this happens.

Comment by wmbz
2011-07-28 10:10:37

“This is EXACTLY the way it should be”.

So why haven’t they been doing this for years & years instead of being forced into it?

Comment by Hwy50ina49Dodge
2011-07-28 10:06:04

Doctors are known to be concerned about how the [volume of] new rationing is working – and how it will affect their [billing] relationships with patient$.

Comment by frankie
2011-07-28 11:37:54

Doesn’t work that way Hwy. Doctors in the NHS are paid a set wage; for example a top Doctor (Consultant)

Consultants can earn a basic salary of between £74,504 and £100,446 per year, dependent on length of service. Local and national clinical excellence awards may be awarded subject to meeting the necessary criteria.

They can also do private work outside the NHS for which they can charge. There is a movement to privatise the NHS in which case your comment about “Doctors are known to be concerned about how the [volume of] new rationing is working – and how it will affect their [billing] relationships with patient$.” will I’ve no doubt become true.

Comment by Hwy50ina49Dodge
2011-07-28 16:47:44

My error frankie, thought his reference was regarding U$A.

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Comment by meastman
2011-07-28 12:13:05

Doctors should not be in the roll of rationing.
That’s a societal issue that should be handled by politicians.

Compare this care of health care rationing to ours

Giant copays and caps on payouts and little care for any without money for insurance.

We spend 2x as much per person and have similar outcomes. That says everything.

Comment by RioAmericanInBrasil
2011-07-28 13:52:58

We spend 2x as much per person (on health care) and have similar outcomes. That says everything

Says but what?

I don’t understand what that means. do you have to use math like a academic or intelectual?

If I didn’t read good its like your saying other countries spend half as much as America per person on Doctor care stuff for similar health results. it’s like you say Blue Cross does a better job in England than in America.

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Comment by In Colorado
2011-07-28 11:35:38

FWIW, private insurance can also tell you that you can’t have a procedure. The only real difference is that procesures cost 2x here vs. over there.

Our system is great if you’re rich or are lucky enough to not have a high deductible plan. HD plans have been great at keeping patients out of doctor’s offices, as the average American can’t afford the deductible. I’ve seen it first hand at my own GP’s practice. No waits any more, because there are hardly any patients.

The number of people I know who “tough it out” when they need to see a doctor is simply staggering. Doctor’s complain that Medicare and Medicaid don’t pay enough, but who else are they going to treat (and consequently bill)?

Comment by liz pendens
2011-07-28 08:38:56

Debt Ceiling Fear-Mongering Reaches Crescendo:

30% Dow Drops, 5%GDP hit, Double-Dips of all kinds:


What a bankster-inspired crock of $hit.

Comment by Hwy50ina49Dodge
2011-07-28 09:22:36

“TrueReducetheDeficitNow! Today!!™” + “True$erialRatingsEnabler$!™” + “TrueAnger!™” gang/po$$e members =

“The blackman (non-Hawaiian) did it!”

Comment by palmetto
2011-07-28 08:44:14

Sometimes it gets a little too serious around here, so I thought I’d lighten up the mood. Enjoy!


AT&T fired President John Walter after nine months, saying he lacked intellectual leadership. He received a $26 million severance package. Perhaps it’s not Walter who’s lacking intelligence.

Police in Oakland , CA , spent two hours attempting to subdue a gunman who had barricaded himself inside his home. After firing ten tear gas canisters, officers discovered that the man was standing beside them in the police line, shouting, ‘Please come out and give yourself up.’

An Illinois man, pretending to have a gun, kidnapped a motorist and forced him to drive to two different automated teller machines, wherein the kidnapper proceeded to withdraw money from his own bank accounts!

A man walked into a Topeka , Kansas Kwik Stop and asked for all the money in the cash drawer. Apparently, the take was too small, so he tied up the store clerk and worked the counter himself for three hours until police showed up and grabbed him.

Police in Los Angeles had good luck with a robbery suspect who just couldn’t control himself during a lineup. When detectives asked each man in the lineup to repeat the words: ‘Give me all your money or I’ll shoot’, the man shouted, ‘that’s not what I said!’

A man spoke frantically into the phone: ‘My wife is pregnant and her contractions are only two minutes apart’.
‘Is this her first child?’ th! e doctor asked. ‘No!’ the man shouted, ‘This is her husband!

In Modesto , CA , Steven Richard King was arrested for trying to hold up a Bank of America branch without a weapon. King used a thumb and a finger to simulate a gun. Unfortunately, he failed to keep his hand in his pocket. (hellooooooo)!

Last summer, down on Lake Isabella, located in the high desert an hour east of Bakersfield, CA, some folks new to boating, were having a problem. No matter how hard they tried, they couldn’t get their brand new 22 foot boat going. It was very sluggish in almost every maneuver, no matter how much power they applied. After about an hour of trying to make it go, they putted into a nearby marina, thinking someone there may be able to tell them what was wrong. A thorough topside check revealed everything in perfect working condition. The engine ran fine, the out-drive went up and down, and the propeller was the correct size and pitch. So, one of the marina guys jumped in the water to check underneath. He came up choking on water, he was laughing so hard.

Under the boat, still strapped securely in place, was the trailer!

Comment by Hwy50ina49Dodge
2011-07-28 09:04:31

Tankxs for giggles… ;-)

Under the boat roof, still strapped securely in place
was the homemoaner.

Comment by In Colorado
2011-07-28 11:26:09

“Under the boat, still strapped securely in place, was the trailer!”

Poor man’s anphipbious vehicle?

Comment by stewie
2011-07-28 12:19:09

I thought for sure on that that last one they were going to find the achor deployed the whole time.

Comment by liz pendens
2011-07-28 09:14:52

I’m not sure what the next trend will be, but it will be a mania.


Comment by Hwy50ina49Dodge
2011-07-28 09:28:41

“One wonders whether a generation that demands instant satisfaction of all its needs and instant solution of the world’s problems will produce anything of lasting value. Such a generation, even when equipped with the most modern technology, will be essentially primitive - it will stand in awe of nature, and submit to the tutelage of medicine men.”

Reflections on the Human Condition
, aph. 60 (1973) / Eric Hoffer

x1 Living example:

Sir Greenis$pent = “medicine man” :-)

Comment by Darrell_in_PHX
2011-07-28 09:21:22

Former director of office of management and budget under Reagan was just on CNBC, basically saying what I’ve been saying. We’re toast.

Revenue increases are off the table.

Significant spending cuts are off the table.

The only point of contention at this point is if we extend the debt enough to get us 6-9 months, or 18-20 months….

If we continue to spend, we are going to face higher interest payments that will swamp any cuts we’ve been talking about upto this point.

Comment by CarrieAnn
2011-07-28 09:25:41

“(Boston Scientific) announced a global restructuring program to eliminate unnecessary administrative positions and automate some production work. The company expects to shed between 1,200 and 1,400 employees by the end of 2013 through layoffs and attrition. Boston Scientific expects the cuts to save between $225 and $275 million annually, some of which will be invested in other areas of the company. The company didn’t specify which divisions would be cut.

The announcement came one day after Boston Scientific unveiled plans to expand operations in China, including the hire of up to 1,000 new employees.”


Comment by Hwy50ina49Dodge
2011-07-28 09:50:02

unveiled plans to expand operations in China

Precisely why Hwy exited the medical device “Bidne$$” in 2006

(dodged a death by price/roi-bullet there!)

Comment by rms
2011-07-28 11:57:49

“Precisely why Hwy exited…”

Did you exit, or did they hold the door for ‘ya?

Comment by Hwy50ina49Dodge
2011-07-28 16:50:07

Me cornfused, it was their money.

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Comment by Arizona Slim
2011-07-28 09:51:47

And Boston Scientific can kiss its intellectual property goodbye.

Comment by Hwy50ina49Dodge
2011-07-28 10:57:02

No worrie$, Boston Scientific will just file a law$uit in Delaware USA and the Chinese Gov’t will deeply apologize, make generous damage re$titution and promise to never do anything like that again anywhere in the whole wide world! It’ll happen so quick, you won’t have time to blink. :-/

Comment by Mike in Miami
2011-07-28 13:07:09

Shanghai Scientific has the EXACT same products for half the price, go figure. They must have saved on R&D cost :)
A friend of mine and former CFO in some smaller company said that they outsourced some of their production to China. Some circuit they had developed was copied exactly by the Chinese, including some error that was in the logic.
Later they abandoned their Chinese venture due to piracy and fixed the error.

Comment by Hwy50ina49Dodge
2011-07-28 16:52:14


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Comment by ecofeco
2011-07-28 14:55:19

Why am I not surprised?

Comment by wmbz
2011-07-28 10:07:36

Even though all the actors suck and the story line is pathetic, it is sort of funny to watch.

GOP aims to gut Christmas, White House alleges
07/28/2011 By Neil Munro - Daily Caller

House Speaker and national grinch John Boehner is planning to spoil Christmas, White House officials are claiming, as they try to head off passage of Boehner’s two-stage debt ceiling bill.

“Happy Holidays America: Boehner plan would have the debt ceiling all over again during the holiday season, which is critical for the economy,” White House deputy spokesman Dan Pfeiffer declared today at 9.50 a.m. (RELATED: WH official predicts closed-door attempt to merge debt ceiling bill)

White House political adviser David Plouffe made the same claim about Christmas almost one hour earlier when MSNBC’s Chuck Todd quizzed him about the White House’s opposition to Boehner’s two-stage debt ceiling proposal.

The plan’s first stage would provide $900 billion to keep the federal government’s spending steady for the next several months, in exchange for a matching spending cut over the next 10 years. But the federal government is expected to burn through that $900 billion by the end of 2011, setting the stage for a second round of dramatic negotiations over another infusion of cash and more matching cuts.

That second round may crash into Christmas, or the “holiday,” according to the White House. The political controversy would crimp consumer confidence and slow the economy, Plouffe said. It would be “a three-ring circus,” he added.

Comment by Hwy50ina49Dodge
2011-07-28 10:41:25

Hurry, reduce/eliminate their taxe$, hurry!,… Cinder$ & Ashe$…Schemer$ & Scammmer$…Agonie$ & Pain$, help ‘em…help ‘em. ;-)

The Forbes family’s big deal causes big trouble:
By Katie Benner July 28, 2011 / CNN money

FORTUNE — The Forbes family has poked itself in the eye with its “capitalist tool.”

Like many publishers, Forbes Media has struggled during the financial crisis. But according to nonpublic documents made available to Fortune, the company has been under more financial strain than previously believed. Forbes Media violated covenants on a revolving credit line that it took out in 2006, according to a letter sent to the company by J.P. Morgan. The loan, which was part of a series of transactions that allowed the Forbes family to cash out more than $100 million from the company, is due next July. Some lenders have been selling pieces of it at a discount from face value.

heheeeheeeheehaahaaahaaheeehaahaaa… (Hwy50™)

Since the death in 1990 of Malcolm Forbes — the unreconstructed tycoon who turned Forbes magazine into a celebration of business victory and its spoils — his children have held a decades-long yard sale of the family’s outré trophy collection. The island in the Fiji archipelago was sold to Red Bull founder Dietrich Mateschitz. A grand ranch in Colorado was picked up by hedge fund executive Louis Bacon. A sultan-worthy palace in Tangier, a custom Boeing 727, helicopters, the world’s largest private collection of Fabergé eggs, and stacks of Victorian art have all been auctioned off. Even the publishing company’s Fifth Avenue headquarters were sold to New York University.

Comment by wmbz
2011-07-28 11:06:26

Once again our (S.C.) Rep. the most ignorant man in the cesspool opens his mouth and removes all doubt.

ITME: Clyburn Likens Executive Order To Raise Debt Ceiling To Emancipation Proclamation. ~ Real Clear Politics

Rep. James Clyburn (D-SC): “I’ve said time and time again, if the President gets up to August 2nd, without a piece of legislation, he should not allow this country to go into default. He should sign an executive order invoking the 14th Amendment and send that to all the governmental agencies for us to continue to pay our bills. He could do that with a stroke of a pen.

“We’ve seen many big things done in history that way. I joked with my staff the other day, telling what was the bill number of the Emancipation Proclamation, it was an executive order. We integrated the armed services by executive order. We integrated public schools by executive order. Sometimes executives must order that things get done.”

Comment by Hwy50ina49Dodge
2011-07-28 12:24:01

Sometimes executives must order that things get done.

Sounds like a SC echo from the past:

Seize Fort Sumter! ;-)

“Sir: by authority of Brigadier General Beauregard, commanding the Provisional Forces of the Confederate States, we have the honor to notify you that he will open fire of his batteries on Fort Sumter in one hour from this time.”

Comment by Darrell_in_PHX
2011-07-28 11:13:59

So Boehner’s plan cuts more spending than it increases the debt limit.

Welll…… Spending cuts if you count 10 years, and debt limit increase that will be used up in less than 9 months.

So, really, we’ll be cutting spending by $75B over the next 9 months that it will take to spend the $1T in extra debt authorization.

More typical politician speak where $75B is greater than $1T.

Comment by wmbz
2011-07-28 11:15:11

Hold on a second I thought continuing to raise taxes was a good thing. Or is it that it works until it doesn’t.

ITEM: CME Group calls tax situation ‘untenable;’ says it may exit state
Reuters - July 28, 2011

CME Group Inc. is evaluating whether to move some operations to other states from Chicago to reduce its taxes, but it has not decided on an exact timeline, CEO Craig Donohue said Thursday.

“Our tax situation is untenable,” Donohue told Reuters, noting that CME is taxed more heavily than any of its global competitors. The company is talking with at least three states — Texas, Florida and Tennessee — about relocating some of its business to take advantage of lower tax rates there, Donohue said.

CME has been based in Chicago since the founding of its oldest market, the Chicago Board of Trade, in 1848.

CME has no specific time frame for moving, Donohue said, and does not plan to shut its Chicago-based trading floor. But he said the possibility of moving other operations is real.

“I don’t think CME group is different from other companies” that relocate to more “hospitable” business environments, he said.

Comment by Darrell_in_PHX
2011-07-28 11:26:47

Race to the bottom.

Comment by Hwy50ina49Dodge
2011-07-28 11:32:33

Hurry! Hurry!, build us a billion dollar$ citizen/taxpayer sub$idized $ports $tadium or else we’ll move the team & cherished logo elsewhere!

Comment by oxide
2011-07-28 14:14:01

YEah, so moving to another state will provide the profit for this year. What will they do next year?

Comment by Happy2bHeard
2011-07-28 22:08:46

Move to China

Comment by Professor Bear
2011-07-28 11:35:47

Question Number Six: Given the current policy regime, would it make sense for the Treasury and Fed to merge their operations?

July 28, 2011 7:01 pm
Five questions for the Fed and Treasury
By Gillian Tett

This week, a cacophonous hubbub is overwhelming America’s airwaves. For with the debt ceiling deadline approaching, almost every pundit and politician worth their salt has been expressing views on what could – or should – happen next.

There is, however, one notable exception: the mighty Federal Reserve and Treasury. In recent weeks, senior officials at both institutions have warned in general terms about the risks of failing to raise the debt ceiling. They have also tried to reassure investors that this risk is small.

But what neither institution has yet done is clearly explain to the financial community what it will do if there is no debt ceiling deal by August 2, or US Treasury bonds are downgraded. And while this reticence is understandable (after all, nobody yet wants to admit this might happen), it is fuelling the sense of anxiety. “They are not saying anything, even in private,” the head of one of the most powerful Wall Street groups confessed this week, who like others, feels “in the dark.”

Comment by Professor Bear
2011-07-28 11:39:30

Guess who uttered these sage words?

“Unfortunately, Congress consistently brings the government to the edge of default before facing its responsibility. This brinkmanship threatens the holders of government bonds and those who rely on Social Security and veterans benefits. Interest markets would skyrocket. Instability would occur in financial markets and the federal deficit would soar.

“The United States has a special responsibility to itself and the world to meet its obligations. It means we have a well-earned reputation for reliability and credibility — two things that set us apart in much of the world.”

Comment by Hwy50ina49Dodge
2011-07-28 12:09:59

Reagan offered this particular dose of common sense on September 26, 1987, in a national radio address. Here is the key part of the text:

Congressional Republicans should read that paragraph out loud twice before going to vote on the debt ceiling in the next few days. It is essentially the same argument Obama has been making. But in our current hyper-partisan environment reason doesn’t resonate across party lines. Instead, there is too often an overheated impulse to oppose Obama at any cost. Hearing the same argument from the Gipper might inspire a needed sense of perspective.

That loss of perspective is a key symptom of hyper-partisanship. It causes people to forget that the national interest comes before partisan interests. This affliction is epidemic at the moment. Whole segments of the GOP 2012 presidential field are debt-ceiling deniers, arguing that defaulting on our debt doesn’t really matter.

Editor’s note: John Avlon is a CNN contributor and senior political columnist for Newsweek and The Daily Beast. He is the author of “Wingnuts: How the Lunatic Fringe Is Hijacking America.” :-)

Comment by Professor Bear
2011-07-28 12:21:39

When my conservative Utah Republican relatives can’t relate to the lunatic fringe for being too far to the right, you know the country has gone off the deep end.

I am frankly amazed at how eager many regular HBB posters are to join the movement. :-)

Comment by Darrell_in_PHX
2011-07-28 12:44:14

Default is coming unless we start getting serious about huge tax increases and even huger spending cuts.

And, I’m talking 50% increase in revenue from $2T ro $3T, combined with 50% cut to DoD, Social Security benefit cuts of 30% (not phased in, NOW on everyone) to keep the plan running surpluses as Baby Boomers retire, and massive healthcare reform to stop Medicare/caid from crushing the economy. That will require much smaller profits to the healthcare industrial complex and true death panels rationing care.

If we can’t make the cuts or increase taxes until we default, then defualt sooner rather than later is better.

We can kick the can down the street a few more months or maybe even a year or two. However, we can not continue to run 40% deficits for very much longer.

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Comment by Professor Bear
2011-07-28 13:01:46

The Republicans have so far drawn a hard line in the sand on tax increases. This stance leaves two options:

1) Draconian, unemployment-increasing federal expenditure cuts.

2) Debt default, with another round of financial chaos similar to what happened in Fall 2008 to follow.

Comment by Professor Bear
2011-07-28 11:40:59

“California Homeowners are Using This Ridiculously Easy Trick to Pay Off Their Homes in Half the Time”

Where did they find the retards prominently on display in these mortgage bailout ads?

Comment by Darrell_in_PHX
2011-07-28 11:58:31

The trick being to make 13 payments a year instead of 12?

Comment by CarrieAnn
2011-07-28 11:52:15

The Post-Standard > DeWitt

ShoppingTown mall in DeWitt now in the hands of lenders as owner Macerich defaults on loan payment

Published: Thursday, July 28, 2011
The owner of ShoppingTown has defaulted on a nearly $39 million loan payment due in May and has turned over the DeWitt mall to its lender, California-based Macerich announced today.


This has been building for a while. It started when Macerich planned an expansion. Told all of the tenants of a wing that was going to be expanded/made into open air retail that they needed to vacate the space. That’s when the credit crisis struck. The mall cancelled the planned updates and limped along w/an empty wing for a while that then was filled w/gyms and athletic training people renting space on the cheap. It’s not too surprising those short term tenants weren’t helping Macerich pay the bills.

Comment by Darrell_in_PHX
2011-07-28 12:01:57

51 million American households don’t pay any federal income tax.

Some see this stat and think we need to raise taxes on the poor.

I see this stat and think 2 things:
1) Eliminate the SS/MC payroll tax and just roll it all into income tax. The simplifications to the tax code are significant, allowing elimination of EIC, per child tax credits, etc.
2) Massive trade terrifs and increases in the minimum wage.

Comment by ecofeco
2011-07-28 15:07:10

1) If they do that, you can definitely kiss SS goodbye.

2)Just eliminating tax breaks for offshoring job, alone, would help immensely.

Comment by Professor Bear
2011-07-28 12:13:11

The U.S. Debt Crisis - What Does It Mean To San Diego?

An audio recording of this interview will be posted here within a few hours of the live broadcast. A transcript will also be added within 24 hours. Thank you for your patience.

By Maureen Cavanaugh, Rachel Goetz , Patty Lane

July 28, 2011

As the threat of a U.S. debt default looms and many San Diegans want to know how it will affect them. And, does looking back in history help us understand what’s happening today on Capitol Hill?


Kelly Cunningham, Economist and Senior Fellow, National University System for Institute and Policy Research

Mark Hendrickson, History Professor, University of Southern California, San Diego

Comment by wmbz
2011-07-28 12:41:50

Holy Moly! Talk about a complete loon.

Nancy Pelosi on today’s vote: “What we’re trying to do is save the world from the Republican budget. We’re trying to save life on this planet as we know it today.”

Comment by ecofeco
2011-07-28 15:08:42

She’s right. It was Repub policy that created the problems.

Comment by wmbz
2011-07-28 15:15:35

Of course she’s right in your eyes, there is only one party that causes the problems and one that has all the solutions on the planet of the loonies. Party hacks don’t have to like them, but do have to live with their limited thought process.

Comment by ecofeco
2011-07-28 18:20:13

NAFTA - Repub
Commodities Modernization Act - Repub
Repeal of Glass Steagal - Repub
Tax breaks for offshoring jobs - Repub
Weakening of the SEC - Repub

Shall I continue?

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Comment by nickpapageorgio
2011-07-28 22:08:28

I would have to check on the others, but the Commodity Futures Modernization Act and the Repeal of Glass Steagal were signed into law by Bill Clinton.

Comment by wmbz
2011-07-28 12:44:28

Your Employees Are Feeling Less Loyal, Survey Finds
By Kate Rogers| FOXBusiness July 28, 2011

Your employees may be thankful to have a job in this rocky economy, but that doesn’t mean they are feeling loyal to your small business.

According a recent study by MetLife, “The 9th Annual Study of Employee Benefits,” only 44% of small business employees feel loyal toward the company they worked for in 2010, down from 62% in 2008. An additional 34% of small business employees said they wanted to work for a different employer.

It seems however, that small business owners are in the dark about how their workers are feeling. The survey found that 54% believe their employees feel a strong sense of loyalty toward their company. For this reason, strengthening employee loyalty and satisfaction may not be top priorities for small business owners.

In fact, employers surveyed said controlling health care costs is their top concern, with 33% ranking it number one. This is followed by retaining employees (22%), increasing employee productivity (19%) and attracting employees (5%).

For workers, the problem starts and ends with benefits. Half of small business employees said they are not satisfied with their current benefit plans. Those workers who do feel satisfied with their benefits tend to be more loyal to their employers (72%). Some of the things employees in the survey expressed interest in were financial education programs and wellness programs, which employers (72%) found to be cost-effective.

Comment by ecofeco
2011-07-28 15:09:51

The employers solution?

The beatings will continue until moral improves.

Comment by wmbz
2011-07-28 12:48:34

How Much Can $1M Buy You? An Entire Town
By Kristen Askin| FOXBusiness July 28, 2011

While $1 million won’t buy you much property in real-estate hot spots like New York or California, it is more than enough to buy an entire town in South Dakota.

On the edge of the Badlands National Forest, you will find the small town of Scenic, S.D., for sale with an attractive price tag of just $799,000.

Twila Merril, a reported former 1950s bare bronc rider, owns the 46-acre town, which had a reported population of just 87 in 2000. According to the listing, Scenic has served as a place for passing travelers to restock on food and gas.

For less than $1 million you get the small town’s post office, convenience store, dance hall, two retail stores, train depot, museum, “world famous” Longhorn saloon, two jails (one working, one not) and couple of houses. All the buildings are included in the price tag, and it’s quite the the bargain: the town was originally listed at $3 million.

Comment by Pete
2011-07-28 13:38:05

I’d take that deal, only if I get to be the Sheriff.

Comment by Professor Bear
2011-07-28 13:56:14

My understanding is the town has a current population of 9, and of those, most if not all belong to the family which is trying to sell the town and move on.

Comment by Hwy50ina49Dodge
2011-07-28 16:59:24

Hey, maybe Clint’s film Co. Maliposa can “lease it” for a remake of High Plains Drifter! :-)

(Come on Clint x1 more before you go to those heavenly green pastures!)

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Comment by Pete
2011-07-28 17:42:31

According to wikipedia, as of the 2010 census, it had 58 inhabitants! My job as sheriff would be to see to it that no one leaves. “Where you headin’ to, rev’rend? Sioux Falls? No, I don’t think so”. Something like that.

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Comment by ecofeco
2011-07-28 15:12:50

Just Google mapped it.

That place doesn’t even qualify as village, let alone a town.

Comment by Professor Bear
2011-07-28 16:43:18

The BBC referred to it as a “ghost town.”

Comment by Professor Bear
2011-07-28 13:04:53

The end game in federal debt-ceiling Kabuki is now underway. I have no clue at this point whether anyone will put down their weapons and unilaterally declare a truce before live ammunition begins to fly.

Reid to Move on Defeating House Debt-Ceiling Plan Tonight
Thursday, July 28, 2011

(Updates with Boehner comments in fifth paragraph. See EXT6 for more on the debt debate.)

July 28 (Bloomberg) — Senate Majority Leader Harry Reid said he will move tonight to kill House Speaker John Boehner’s debt-ceiling plan, paving the way for Senate votes this weekend on a possible compromise to avert a potential U.S. default.

Republican House leaders expressed optimism their measure would pass later today. If it does, Reid, a Nevada Democrat, said he plans to bring Boehner’s legislation immediately to the floor and “it will be defeated.”

“No Democrat will vote for a short-term Band-Aid that would put our economy at risk and put the nation back in this untenable situation a few short months from now,” Reid said.

That would allow Reid to accelerate negotiations among leaders on both sides to raise the nation’s $14.3 trillion debt limit ahead of an Aug. 2 deadline.

Boehner, an Ohio Republican, defended his plan, calling it “a sincere, honest effort to end this crisis in a bipartisan way.”

The Senate is likely to begin voting this weekend on an alternative proposal from Reid to raise the debt ceiling by the full $2.4 trillion President Barack Obama has requested, while cutting $2.2 trillion over a decade. Senate leaders are working privately to reach a compromise that could clear Congress by Aug. 2, the date the Treasury Department says the nation will breach its borrowing limit and run out of options for avoiding default.

‘Sit Down and Negotiate’

Senator Chuck Schumer of New York, the third-ranking Democrat, said Republicans should “sit down and negotiate.”

“Throwing a hot potato over to us that won’t pass just delays things a day, and we are simply four days away from one of the worst financial catastrophes that could face this country,” he said.

Comment by Happy2bHeard
2011-07-28 22:17:39

“Boehner, an Ohio Republican, defended his plan, calling it “a sincere, honest effort to end this crisis in a bipartisan way.”

Would that be the Republican Party and the Tea Party?

Comment by Professor Bear
2011-07-28 13:07:31

White House plans emergency cuts as debt deadline looms

Uncertainty still rules as US political parties fail to compromise on a strategy to tackle economic crisis

Ewen MacAskill
guardian.co.uk, Thursday 28 July 2011 20.31 BST
Article history

The White House is expressing optimisim that a compromise deal can be reached before the 2 August deadline Photograph: Charles Dharapak/AP

The White House is drawing up emergency plans for next week’s debt crisis deadline in the event that Congress fails to reach a last-gasp compromise.

With only six days left, the White House dismissed as “political theatre” a new bill before the Republican-controlled House that would cut spending in return for raising the $14.3tn (£8.7tn) debt ceiling.

The White House spokesman, Jay Carney, addressing the daily press conference today, said the bill was hated by the Democratic-controlled Senate and the White House and was “dead on arrival”.

The Senate will not vote for it and, even if it did, Barack Obama would veto it. Fifty-one Democratic members of the Senate, a majority, published a letter pledging to vote against the House bill.

Democrats in the Senate are preparing a bill of their own but the chances are Republicans in the House would vote that down too.

Global markets, initially sanguine about the crisis and confident of an eventual compromise, were increasingly jittery on Thursday. There were early market falls but US stocks gained and the dollar rose during the day, buoyed by unexpectedly good unemployment figures.

The Democratic leader in the Senate, Harry Reid, warned: “Default will rock our financial system to its core.” He expressed hope that there could still be a deal. “Magic things can happen here in Congress in a very short period of time under the right circumstances,” he said.

The White House, too, expressed optimism that a compromise could be reached.

Negotiations are continuing in private between the White House and senior Republicans and Democrats on a possible short-term emergency deal. But Carney admitted that, in the event there is no deal, the treasury would explain its plans in detail before 2 August.

Carney said: “As we get closer to that date, the treasury will explain how it will manage a situation that is impossible.” He acknowledged for the first time that the uncertainty was already causing harm to the US economy.

The White House will almost certainly make its priority paying interest on its debts so that the US does not default for the first time in its history. But the consequence could be delaying monthly payments to federal workers, soldiers and other employees, and millions of cheques to social security recipients, veterans and others.

Comment by wmbz
2011-07-28 13:08:19

Rural US disappearing? Population share hits low

WASHINGTON (AP) — Rural America now accounts for just 16 percent of the nation’s population, the lowest ever.

The latest 2010 census numbers hint at an emerging America where, by midcentury, city boundaries become indistinct and rural areas grow ever less relevant. Many communities could shrink to virtual ghost towns as they shutter businesses and close down schools, demographers say.

More metro areas are booming into sprawling megalopolises. Barring fresh investment that could bring jobs, however, large swaths of the Great Plains and Appalachia, along with parts of Arkansas, Mississippi and North Texas, could face significant population declines.

These places posted some of the biggest losses over the past decade as young adults left and the people who stayed got older, moving past childbearing years.

For instance in West Virginia, now with a median age of 41.3, the share of Americans 65 and older is now nearly double that of young adults 18-24 - 16 percent compared to 9 percent, according to census figures released Thursday. In 1970, the shares of the two groups were roughly equal at 12 percent.

“This place ain’t dead yet, but it’s got about half a foot in the grave,” said Bob Frees, 61, of Moundsville, W.Va., which now has a population of just over 9,000. “The big-money jobs are all gone. We used to have the big mills and the rolling plants and stuff like that, and you could walk out of high school when you were 16 or 17 and get a $15-an-hour job.”

Demographers put it a bit more formally.

“Some of the most isolated rural areas face a major uphill battle, with a broad area of the country emptying out,” said Mark Mather, associate vice president of the Population Reference Bureau, a research group in Washington, D.C. “Many rural areas can’t attract workers because there aren’t any jobs, and businesses won’t relocate there because there aren’t enough qualified workers. So they are caught in a downward spiral.”

Rural towns are scrambling to attract new residents and stave off heavy funding cuts from financially strapped federal and state governments.

Delta Air Lines recently announced it would end flight service to 24 small airports, several of them in the Great Plains, and the U.S. Postal Service is mulling plans to close thousands of branches in mostly rural areas of the country. The University of Kansas this month opened a new medical school with a class of eight in Salina, a regional hub of nearly 50,000 people, in hopes of supporting nearby rural communities that have no doctors at all.

In North Dakota, colleges are seeking to draw in young adults by charging low tuition and fees. It’s part of a broader trend in which many slow-growing rural states are touting recreational scenic landscapes or extending tuition breaks to out-of-state residents who typically are charged more.

Many rural areas, the Great Plains in particular, have been steadily losing population since the 1930s with few signs of the trend slowing in coming decades, according to census figures.

Comment by Carl Morris
2011-07-28 13:52:59

That’s a tough one. They had to give away the land in a lot of cases to get people to move there in the first place, and that was when people knew how to make a living off the land. Until petroleum gets cheap enough to reward manual labor in farming again I can’t see how anything changes. And even then it will probably have to be given away again to get used.

Perhaps we should let it go back to grass and buffalo?

Comment by Arizona Slim
2011-07-28 14:37:40

Perhaps we should let it go back to grass and buffalo?

Don’t trifle with buffalo. I learned this first hand when I was in Wind Cave National Park back in ‘87. (I was headed up to Canada on my bike.)

Any-hoo, just past the “beware of Buffalo” sign that the Park Service had thoughtfully posted, I came upon one big-arsed, ornery looking buffalo.

He glared at me as if to say “Look little bikey, I can crush you like a bug. But since I’m not in the mood right now, I’ll let you go.”

Trust me, I quietly rode past that buffalo. Didn’t want to annoy it, if you get my drift.

And I was glad to get away unscathed. Very glad.

Comment by Carl Morris
2011-07-28 15:22:27

Growing up near Yellowstone I see buffalo on a fairly regular basis when I’m back home. I’ve passed by them too close for comfort on a snowmobile when neither of us wants to leave the road and have to get by each other. They can be stupid AND mean, which is dangerous in any kind of creature. They’re usually fine, though.

We had neighbors try to keep one in their pasture when I was a kid. Didn’t turn out well.

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Comment by X-GSfixr
2011-07-28 16:13:59

People who train cutting horses have some buffalo around here.
Because if a horse will cut buffalo, it will cut anything.

These buffalo are “domesticated” (as it gets, I guess). One of the females has her own special way of entertaining herself.

She will charge right at you, then at the last second, swerve away.

I’ve been dying to go get this on film, and put it on YouTube.

Comment by Arizona Slim
2011-07-28 14:34:03

“Some of the most isolated rural areas face a major uphill battle, with a broad area of the country emptying out,” said Mark Mather, associate vice president of the Population Reference Bureau, a research group in Washington, D.C. “Many rural areas can’t attract workers because there aren’t any jobs, and businesses won’t relocate there because there aren’t enough qualified workers. So they are caught in a downward spiral.”

Back when I was a bicycle touring Slim, I noticed this. It was especially apparent when I was bicycling from Mexico to Canada in 1987. The American High Plains were literally emptying out.

To the point that I passed through a county seat in Nebraska that wasn’t large enough to be incorporated as a town.

Comment by Professor Bear
2011-07-28 13:13:51

How come the MSM keeps saying the U.S. has never defaulted on its debt, when it did so as recently as 32 years ago?

I always wondered why long-term Treasury yields rocketed upwards during the first couple of years Ronald Reagan was in the WH, leading to the worst labor market recession since the Great Depression, at least before the current episode.

1979 U.S.
Government may have to decide which bills to pay and which to defer
July 27, 2011|Phil Rosenthal

What big news do you remember from April 1979? That Iran voted to become an Islamic Republic? That a threatening swamp rabbit was stopped short of President Jimmy Carter’s fishing boat? That Jane Byrne took office as Chicago’s mayor?

How about the heated debt-ceiling debate on Capitol Hill up until the last minute, followed by some missed Treasury bill payments?

You’re not alone if you missed it or don’t recall. But the supposedly unprecedented default of the United States that’s threatened by the stalemate in Washington has precedent.

The earlier misstep offers a hint of just what’s at stake in the heated debt-ceiling talks this time around, and it’s just one more reminder of how bizarre the process is that has brought us to this point yet again.

“Brinkmanship negotiations are things that rational human beings are often troubled by,” said Donald Marron, director of the Tax Policy Center, a joint venture of the Urban Institute and Brookings Institution. “These things that say, ‘If you don’t address this by such and such a date, terrible things will happen,’ are funky negotiations because whoever is willing to portray themselves as the craziest, most outlandish person has a lot of negotiating leverage.”

Marron, who taught economics and finance at the University of Chicago’s graduate school of business in the mid-1990s, knows from the inside. Between 2002 and 2009 he served in senior posts for the White House and Congress, including as a member of the President’s Council of Economic Advisers and acting director of the Congressional Budget Office.

“I have said publicly we should get rid of the debt limit and come up with some other budget process because it’s strange to have the wealthiest nation on Earth talking about default,” he said. “Most other nations … if you vote for a spending bill, you are also authorizing whatever debt will result from that spending.

“We don’t do it that way. This has given rise to a long-standing kind of political-posturing issue where each time we get close to hitting the debt limit, the party that’s in power has the burden of increasing the debt limit, and the party that’s in the minority gets to do a bit of grandstanding about the evils of debt.”

Comment by wmbz
2011-07-28 13:16:31

“Appalled” really? Hey China, thought you liked all that U.S. debt you’ve been buying.

ITEM: Chinese ‘Appalled’ by U.S. Debt Impasse: Roach

Senior Chinese officials are “appalled” by the impasse among U.S. politicians on raising the nation’s debt ceiling to avoid a default, said Stephen Roach, non-executive chairman of Morgan Stanley Asia Ltd.

“Coming so shortly on the heels of the subprime crisis, the debate over the debt ceiling and the budget deficit is the last straw” for China, New York-based Roach, 65, said in an e- mailed note today. He said his assessment was based on visits to Beijing, Shanghai, Chongqing and Hong Kong.

Comment by Professor Bear
2011-07-28 15:35:22

There seems to be no shortage of helpful advice from abroad on how the U.S. should address its debt ceiling issues.

The Financial Times
July 28, 2011 5:18 pm
Chinese media attacks US on debt limit
By Jamil Anderlini in Beijing

Chinese state media criticised the brinkmanship in Washington over how to raise the debt limit as “dangerously irresponsible” and said the US could plunge the world into a recession that could be “much nastier” than the one that hit in 2008.

“The ugliest part of the saga is that the well-being of many other countries is also in the impact zone when the donkey and the elephant fight,” the commentary published on Xinhua, the official state news wire, said.

The article also excoriated US “debt addiction” and said it was “time for Washington to revisit the time-tested common sense that one should live within one’s means”.

The opinion piece was attributed to Xinhua writer Deng Yushan and not to anyone within the Chinese government. But Xinhua is the government’s official mouthpiece and the commentary likely had the blessing of at least some elements within the regime.

The article went on to say that US politicians needed to “conduct an in-depth self-examination” and work out how to “shake off electoral politics and get difficult jobs done more efficiently”.

Comment by meastman
2011-07-28 13:24:36

WASHINGTON (Reuters) - Lawmakers are eyeing a popular tax deduction for mortgage interest as they look for ways to fill record budget deficits, although any changes are likely to await a broad reworking of the tax code.

Two forces are conspiring in a way that could put the long-cherished deduction on the chopping block: a need to raise more revenues and a feeling among policymakers that government incentives for housing have been too generous.

Comment by Professor Bear
2011-07-28 13:33:04

What amazes me is how the Congress always manages to find adequate funds to protect REIC sacred cows like the MID or GSE support for unaffordable housing prices, no matter how bad the fiscal crisis.

Comment by Carl Morris
2011-07-28 13:56:20

They came up with the money to prevent GS from taking an AIG loss due to counterparty risk *FAST*, if I recall correctly.

Comment by Professor Bear
2011-07-28 13:34:35

Does it seem to others like professional economists’ voices have been drowned out by Congressional shouting during the debt ceiling debate?

Robert Shiller: ‘Tax and Spend’

Despite the national debt crisis, Yale economics Prof. Robert Shiller says he believes the U.S. government should spend more money to create jobs and reduce unemployment.

Comment by ecofeco
2011-07-28 15:17:33

Why spend money when all that is needed is to eliminate the tax breaks for offshoring jobs?

Wall St. is the biggest welfare there ever was.

Comment by ecofeco
2011-07-28 15:21:07

“Queen.” …welfare queen…

Comment by Professor Bear
2011-07-28 15:43:42

Though the Tea Party remedy runs 180 degrees opposite what most professional economists are recommending at the moment, I guess they are in control now.

Blinder: Political Gridlock Puts Economy at Risk
July 27, 2011

The U.S. is shooting itself in the foot over the debt-reduction debate, says Alan Blinder, a professor of economics at Princeton University and a former vice chairman of the Federal Reserve. Even considering default is a “ridiculous debate” that could lead to a downgrade of U.S. debt, he tells WSJ’s E.S. Browning.

Comment by RioAmericanInBrasil
2011-07-28 16:10:28

Robert Shiller says he believes the U.S. government should spend more money to create jobs and reduce unemployment.

Hey! I just thought about something cool.

We need to redistribute wealth. Hey why not? It’s what REAL Americans do. This is nothing new. For 30 we’ve been doing it. We’ve redistributed wealth from the bottom to the top. Let’s redistribute wealth now from the top to the bottom. Why “hate the rich”? They rock. I love the rich because that’s where we can now go and get back our money and redistribute it. You know. Spread the wealth and all. It will be fun. Our best years for the middle-class was after we redistributed the wealth after the Great Depression. Our best. You know, let’s all confiscate our stolen wealth through taxes and stuff. Confiscate it through higher taxes. Yea. “confiscate” (I like the sound of that, the right uses some cool words. )

In this recession our wealth was still redistributed bottom to top. That’s not very cool. And we need more public social program support like Soc Sec and maybe single payer or at least a public option. What do we got now? Fascism? But at least we have Netflix.

We need to tax the rich a lot more and spend that money on social and infrastructure public programs and start subsidizing small business start-ups, maybe with like free socialized medicine for the first few years. Why didn’t anyone else think of this?

Comment by Professor Bear
2011-07-28 14:10:46

Go Rahm! Hopefully this is a sign of things to come. Why should local municipalities have to bear the costs of foreclosure blight due to lender abandonment?

Mortgage holders now more accountable for abandoned buildings
By Antonio Olivo Tribune reporter
1:17 p.m. CDT, July 28, 2011

The Chicago City Council passed legislation today that makes banks and other financial companies more accountable for problems inside thousands of abandoned buildings.

The ordinance, which passed unanimously, faced adamant opposition from the financial industry, including the federal agency that regulates Fannie Mae and Freddie Mac, which have a stake in the majority of mortgages in the country.

Among other things, the “vacant buildings” ordinance redefines the “owner” of abandoned buildings in the city to include mortgage holders and other companies collecting mortgage payments.

Financial groups have argued that the legislation — among the more aggressive attempts to deal with impacts from the ongoing foreclosure crisis — violates Illinois property rights.

Mayor Rahm Emanuel, who backed the legislation, said the ordinance will allow city officials more leverage with financial institutions in trying to fix problems connected to abandoned homes.

“The foreclosure crisis around the country is usually isolated to some parts of the city,” the mayor said. But “this affects everybody in the city.”

Comment by Professor Bear
2011-07-28 14:28:01

Here is a most interesting twist in debt ceiling economics.

JULY 28, 2011, 4:16 P.M. ET

‘Dollar Trap’ Ties Reluctant Foreign Central Banks To U.S. Treasurys

Foreign central banks are the true giants of the market for U.S. Treasury bonds, so the U.S. government will be relieved that the dispute over the nation’s debt ceiling hasn’t sent these deep-pocketed bondholders running for the exits.

But the reason these all-important investors continue to buy and hold Treasurys may have little to do with their faith in Washington, D.C.’s capacity to get its fiscal house in order and more to do with a Catch-22 dilemma known as “the dollar trap.”

Here’s how it works: If central banks such as those of China and Japan–which collectively have more than $4 trillion in foreign-exchange reserves–were to dump some of their gigantic holdings of U.S. Treasurys, or even signal their intent to do so, they would drive down the value of the dollar against their own currencies. That in turn would force them to intervene in foreign-exchange markets and buy dollars to protect their exporters’ interests. It would leave them with little choice but to plow those dollars back into Treasurys, the world’s only bond market deep and liquid enough to handle such big transactions.

“I don’t believe foreign central banks will dump Treasurys, in the sense that they will not sell the stock of what they already own,” said Stephen Jen, managing partner of London-based hedge fund SLJ Macro Partners LLP and former head of global currency research at Morgan Stanley.

Comment by wmbz
2011-07-28 15:20:52

Hot Damn! Can’t wait for $120.00 a barrel! Evil big oil is kicking a$$.

Big Oil reaps big profit in 2Q as fuel prices soar- AP

Big Oil continued to make big money in the second quarter. Industry giants Exxon Mobil and Royal Dutch Shell on Thursday reported combined net income of more than $18 billion, because of higher prices for oil, gasoline and other fuels.

Comment by Professor Bear
2011-07-28 15:28:23

July 28, 2011 5:57 PM

Trouble? House GOP delays debt limit vote
By Brian Montopoli
Updated 6:08 p.m. Eastern Time

House Republican leaders have delayed their planned vote on a bill to increase the debt limit in a sign they may not have enough votes for passage.

The vote, which had been set for around 6 p.m. Eastern Time, has not been rescheduled, though a House GOP leadership aide told CBS News it is still planned for tonight.

The Republican leadership has been working feverishly to get the votes to pass the bill over the objections of the fiscal conservative hard-liners in their caucus; earlier this week, House Majority Leader John Boehner (pictured) told members to “get your ass in line.” Republicans fear that if the bill fails they will effectively hand Democrats both a political and legislative victory to conclude the protracted debt limit fight.

Republicans who have said they were voting no or that they were leaning in that direction are now being called into Boehner’s office; on his way in, Rep. Louis Gohmert of Texas quipped he had been called to the “principal’s office.”

When he came out, Gohmert said he remains a “bloody, beaten down no.”

Reps. Trent Frank and Jeff Flake of Arizona would not discuss how they will vote when they left Boehner’s office.

The vote is seen as a crucial test of whether Boehner can control his caucus, which includes many Tea Party-linked conservatives - many of them freshmen - who argued the bill did not go far enough to reduce spending. The bill has been opposed by outside groups like The Club for Growth, fiscally-conservative Republican Study Group head Rep. Jim Jordan of Ohio and Republican presidential candidate Rep. Michele Bachmann of Minnesota.

Comment by Hwy50ina49Dodge
2011-07-28 17:13:57

As afternoon debate headed toward evening, GOP leaders ordered an unexplained halt on the measure and Speaker John Boehner summoned a string of recalcitrant rank-and-file Republicans to his office.

Rumor is JB just received x2 paddles FedEx Red from a shadow secret anonymous duck hunter in Wyoming. ;-)

Comment by liz pendens
Comment by Professor Bear
2011-07-28 16:30:17

28 July 2011 Last updated at 09:22 ET

In Steinbeck’s footsteps: America’s middle-class underclass
Paul Mason By Paul Mason Economics editor,
Newsnight On the road

In The Grapes of Wrath, John Steinbeck describes the harrowing journey of the Joad family - migrant workers forced to leave their home during the Great Depression - a story still relevant to those facing the realities of America’s current economic crisis.

“To the red country, and part of the gray country of Oklahoma the last rains came gently, and they did not cut the scarred earth…” That is how Steinbeck begins The Grapes of Wrath.

I cross the Mojave by night and get to Bakersfield at midnight.

The bar at the hotel is full of oilmen and military guys. The economy of Kern County, where the Joads ended up, is dominated by the Air Force, naval weaponry, big oil and private healthcare.

But there is still 15% unemployment here. The town grew by 25% in the past decade but now the property bust is here, 156 homes in every thousand are repossessed.

In the morning, the car valet - a Mexican - tells me the agricultural work is drying up. The farmers sold their fields for property. You can only earn the minimum wage.

I go in search of the spot where Steinbeck must have seen this - “They drove through Tehachapi in the morning glow, and the sun came up behind them and then suddenly they saw the great valley below them…”

But the interstate highway obliterates the old road here. I drive into a vineyard to get the view that must have greeted the real-life Okies as they crossed the mountains into the San Joaquin Valley.

It is still beautiful. But hidden away from the mainstream media you can still find stories of social conflict and poverty that tell the other side of the story.

When he wrote the novel in 1939, Steinbeck pointed to a new economic model that would sustain the economic recovery, create jobs and drive the US into the era of prosperity and full employment.

That is the question that still confronts the US, as its president and legislature - as the Onion magazine so wryly put it - “continue the debate over whether the country should be economically ruined”.

Comment by Hwy50ina49Dodge
2011-07-28 17:18:49

get to Bakersfield at midnight.

He doesn’t know the pain he spared his eyes by this timely arrival. Odd, no mention of the pesticide perfume.

Comment by Bill in Phoenix and Tampa
2011-07-28 16:33:04

Feel sorry for my older friend at work. He’s 72 and has a HUGE McMansion in the south. Some family members are about to move. His wife would hold the fort. But they want to get rid of the house. Huge monthly payments. He has 15 years more on the mortgage.

He says he wants to keep working. He likes work. But he’s complaining about the house. I tell him why not figure out the least painful way to get out from under it?

I don’t know what that is. He jokingly said the least painful is if he would die. But he’s just another statistic of fools who chased a bubble.

Comment by Professor Bear
2011-07-28 16:36:07

“He jokingly said the least painful is if he would die.”

We will hear that over and again for the next three decades to come.

Comment by Professor Bear
2011-07-28 16:35:06

The Onion
News in Brief
Congress Continues Debate Over Whether Or Not Nation Should Be Economically Ruined

July 20, 2011 | ISSUE 47•29

Related Articles

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WASHINGTON—Members of the U.S. Congress reported Wednesday they were continuing to carefully debate the issue of whether or not they should allow the country to descend into a roiling economic meltdown of historically dire proportions. “It is a question that, I think, is worthy of serious consideration: Should we take steps to avoid a crippling, decades-long depression that would lead to disastrous consequences on a worldwide scale? Or should we not do that?” asked House Majority Leader Eric Cantor (R-VA), adding that arguments could be made for both sides, and that the debate over ensuring America’s financial solvency versus allowing the nation to default on its debt—which would torpedo stock markets, cause mortgage and interests rates to skyrocket, and decimate the value of the U.S. dollar—is “certainly a conversation worth having.” “Obviously, we don’t want to rush to consensus on whether it is or isn’t a good idea to save the American economy and all our respective livelihoods from certain peril until we’ve examined this thorny dilemma from every angle. And if we’re still discussing this matter on Aug. 2, well, then, so be it.” At press time, President Obama said he personally believed the country should not be economically ruined.

Comment by Hwy50ina49Dodge
2011-07-28 17:45:53

whether it is or isn’t a good idea to save the American economy and all our respective livelihoods from certain peril

And if we’re still discussing this matter on Aug. 2, well, then, so be it

Is it Aireek Can’tor or Aireek Won’t?:

“To raise or not to raise that is the que$tion I ask of me.”

Comment by Professor Bear
2011-07-28 16:48:10

Time to assume the crash position yet? Because I don’t see how this can get resolved, with the Democrats threatening to veto the Boehner bill if it passes, and the Tea Party faction saying they won’t vote for the Boehner bill because it doesn’t cut enough.

I confess I feel more confident in predicting real estate collapses than political failures.

Without Tea Party Votes, Boehner Speakership Hits Rough Waters
06:30 pm
July 28, 2011
by Frank James

Just as the Washington narrative had started to shift a bit from “House Speaker John Boehner doesn’t have the juice to get his conference to support him” to “Boehner is getting his fellow Republicans to rally around him” it shifts back to the former.

That’s because he was unable to get enough members of the Republican conference to commit to voting for his debt-ceiling increase.

It should go without saying, this is a signal setback for the speaker, who in recent days had pleaded, cajoled and demanded that his conference get behind him if, for no other reason, to show solidarity as he confronts the Democrats who control the Senate and the White House.

Aides in the speaker’s office are telling reporters that they still expect a vote Thursday night. But that doesn’t minimize the fact that after raising expectations for a vote that was seen as a test of his persuasive powers as speaker, Boehner was forced to order a strategic retreat.

The message many analysts are bound to take away from this episode is that the tail is wagging the dog to a degree a large degree in the House Republican conference, namely members linked to the Tea Party, including freshmen.

Those members have little allegiance to Boehner. In fact, many of them eye him suspiciously as a card-carrying member of the Washington establishment that’s part of the problem, not the solution.

They felt burned by the budget deal Boehner negotiated with President Obama earlier this year to prevent the government shutdown in March, that Boehner told them there were more spending cuts in that package than there actually were.

They vowed they wouldn’t be fooled again and that was reflected, in part, in Boehner’s failure to get enough votes for his debt-ceiling bill by the time of the scheduled vote, 6 pm eastern time Thursday.

So the question is, now what? Again, the speaker’s office may be able to swing another vote Thursday evening if leaders can find the votes they need.

But if they come up short, that leaves no clear path in Congress to solving the debt-ceiling crisis.

Comment by Hwy50ina49Dodge
2011-07-28 17:26:09

Joe Biden could be key to debt limit compromise

By Norah O’Donnell / Topics Economy , Congress

Go Joe! Allllll Aboarrrrrrrrrd Amtrak! :-)

…lil’ Opie is relying on his vice president, Joe Biden, to leverage his longstanding Senate relationships to try and forge a compromise out of it.

Comment by Professor Bear
2011-07-28 17:38:51

Editorial Board Opinion
Time for the grown-ups to enter the debt showdown
By Editorial, Thursday, July 28, 5:08 PM

THE DEBATE over raising the debt ceiling has passed the point of usefully concentrating the mind on the need for debt reduction. Now the hanging moment is nigh. It is time for the remaining grown-ups in Washington — and we trust there are some — to figure out how to help the country slip off the noose. The debt ceiling needs to be lifted. The alternative is unthinkable.

The House spent the day Thursday debating a plan that it knew the Senate would not pass and the president would not sign. Then, as time was running out, House Speaker John A. Boehner (R-Ohio) abruptly postponed the vote, an indication that he lacked the necessary votes from his out-of-control caucus. Even if the speaker manages to push his package across the finish line, it will be dead on arrival in the Senate.

It is an ominous sign that House Republicans have become so extreme that they have difficulty mustering enough votes to pass a plan that includes close to $1 trillion in cuts now and sets the stage for another $1.8 trillion to be identified later as the price of lifting the debt ceiling. The no-way caucus is the modern incarnation of the Flat Earth Society, denying the reality that the ceiling must be lifted and that the consequences of failing to act would be devastating to the economy.

Comment by Muggy
2011-07-28 17:56:10

On the road… in Onondaga, NY right now. Total timewarp, like 2006 never happened.

Comment by Realtors Are Liars®
2011-07-28 20:12:05

Muggy give us a road report!!

Comment by Professor Bear
2011-07-28 18:13:20

Ripple Effects Of Debt Ceiling Debate On San Diego
By Joanne Faryon

Originally published July 28, 2011 at 6 a.m., updated July 28, 2011 at 2:41 p.m.

SAN DIEGO — The federal government does billions of dollars in business with San Diego County. The contracts range from business with private defense contractors to making Social Security payments to seniors. Those payments are in jeopardy unless federal lawmakers reaches a debt ceiling deal by next Tuesday.

Peruse the government website USAspending.gov and search the word San Diego.

Up comes a long list of contracts worth billions. The federal government is obligated to make payments to state and local levels of government including the Health and Human Services Agency; with private companies like General Dynamics Corporation; and with senior citizens on Social Security.

The state of California has secured a $5 billion loan to make good on Medicare, transportation, and education payments if the federal government stops paying. But many private companies and individuals could be left unpaid through no fault of their own.

“Vendors who contract with the federal government, they could get hurt; Social Security recipients, students that have loans,” said Tom Dresslar, spokesperson for the California Treasurer.

Dresslar warns the ripple effect of failure to meet the debt ceiling deadline ultimately affects just about everyone in some way. Californians are already on the hook for a $4 million interest payment due in November, as a result of the loan it has arragned in case the federal government fails to make state payments.

That’s money taxpayers have to pay as a result of the debt ceiling impasse, Dresslar said.

Where They Stand

KPBS asked each member of the San Diego Congressional delegation where they stand on the debt ceiling debate. Here are their responses.

“Speaker Boehner has empowered members of our conference to be leaders and the results are reflected in the passage the Ryan Budget and Cut, Cap and Balance and he continues to ably represent us in negotiations over the debt limit. The result of those discussions, limited as they may be, will be a significant step in the right direction – toward fiscal responsibility and a government that lives within its means. The Speaker has my full support and the support of our conference as he negotiates on behalf of the House of Representatives and the American people.” Rep. Darrell Issa (R) 49th district

“My office has been inundated with calls concerning the debt ceiling crisis. An overwhelming majority of callers want Congress to work together to pay America’s bills and invest in our future. I had a call from a man with cerebral palsy. He works two days a week at McDonald’s, but he relies on Social Security and Medicare to live. We should not be playing with his future. I hoped Congress could have compromised on a package to show that we were serious about solving our problems. Unfortunately, the economy is already starting to react negatively. We need a long-term plan that will stem the tide of uncertainty.” Rep. Susan Davis (D) 53rd district

“Mr. Hunter is still examining the details of the House plan. He hasn’t made a decision. Congressman Hunter believes we need a solution. This debate is about the country’s future and what the next generation of Americans, including his own children, will be left to accept through the decisions made today. Also, the debate is far bigger than raising the debt ceiling, it’s about restoring sanity to the budget and ensuring we are no longer borrowing 40 cents on every dollar. And I’ll say this about the vote: Congressman Hunter has some reservations with the plan that’s now on the table, but, he’ll take a closer look at the final product, when it’s available, and make a decision based on what it actually looks like.” Spokesperson for Rep. Duncan D. Hunter (R) 52nd district

“The United States will make good on its debt obligations, but reaching our debt limit is only a symptom of the real problem. Forty-cents out of every dollar our government spends is borrowed. We are not just borrowing from China to the tune of $1.16 trillion, we are stealing from our grandchildren. In order to restore certainty in our economy to bolster job growth and keep America competitive we need to stop spending money we don’t have. Raising the debt limit without a credible plan to end Washington’s wasteful spending will destroy jobs and make our debt problems even worse.” Rep. Brian Bilbray (R) 50th district

Rep. Bob Filner (D) 51st district, did not respond to our request.

Comment by Professor Bear
2011-07-28 18:53:08

I keep reading about how a failure to increase the debt ceiling would result in higher interest rates. If so, how come long-term Treasury yields went down today?


JULY 28, 2011, 6:54 P.M. ET

In Backup Plan, Bondholders Are First to Be Paid

The Treasury Department would likely pay bondholders before other creditors if Congress doesn’t raise the debt ceiling before the government runs out of cash, two people familiar with the matter said Thursday.

Treasury officials have prepared an emergency plan to prioritize payments and avoid default if the $14.29 trillion federal borrowing limit isn’t raised by Tuesday, the people said.

The gap between spending and revenue is projected to be close to $130 billion in August, so the government will have to scale back its spending by more than 40%. White House officials have said they will have to make brutal economic decisions.

To avoid defaulting on U.S. government debt, the Treasury would probably make a $29 billion interest payment to bondholders on Aug. 15. That would leave about $101 billion in cuts to others owed government checks in August, including contractors and recipients of Social Security benefits or military pensions.

Obama administration officials have warned that missing any bond payments would constitute a default on government obligations, which could shake financial markets and possibly trigger another crisis and recession.

President Barack Obama has noted how difficult it would be to prioritize some payments over others, and has prodded lawmakers to act swiftly to finish a deal.

“Are we really going to start paying interest to Chinese who hold Treasurys and we’re not going to pay folks their Social Security checks, or we’re not going to pay veterans for their disability checks?” he said in June. “I mean, which bills—which obligations are we going to say we don’t have to pay?”

Comment by Professor Bear
2011-07-28 18:58:24

If there is a silver lining in the debt ceiling showdown, at least it has helped to take our minds off the housing crisis.

Oh wait…

Debt-Ceiling Crisis Could Wallop the Housing Sector
By Jim Tankersley
Jul 28 2011, 6:25 PM ET

The real-estate market is slowly getting better, but if Congress doesn’t act in time, mortgage rates could soar

It’s tough to see, given the onslaught of brutal economic and political news that has dominated recent headlines, but Thursday actually brought a sliver of good news about the beleaguered housing market: The National Association of Realtors reported that its measure of pending home sales climbed by 2.4 percent in June, followed a strong but oft-forgotten 8.2 percent rise in May.

Thursday’s report surpassed the Bloomberg consensus forecast for a 2 percent drop. But despite the signs of new life in the housing market, potentially terrible news looms on the horizon. If Congress and President Obama can’t find agreement on raising the nation’s borrowing limit, the housing sector could suffer another big hit.

Housing remains the economy’s most troublesome problem child. Unlike consumer spending and hiring, which each surged briefly during this slow-and-go recovery, housing has stayed in near free-fall (except for the period when federal tax credits were propping it up artificially) throughout the country since the financial crisis.

Home prices continued to fall, year over year, in the Case-Shiller numbers released this week. Home sales and home-building levels remain extremely depressed, and with them, employment in real estate and construction. A glut of foreclosures continues to clog the market.

Those problems figure to compound under almost any scenario in which lawmakers fail to raise the debt ceiling in time. If the government defaults on its debt, or if rating agencies downgrade its credit score, interest rates figure to soar–and likely, mortgage rates with them.

Equally troublesome is the possibility of the federal government prioritizing its bills, having run out of borrowing authority, and skipping payments to contractors, government workers, or beneficiaries of social programs such as Medicare or Social Security–leaving a lot of Americans with a lot less money to buy a house or make a mortgage payment.

Analysts’ estimates of how much that would hurt the market range from “a bit” to “a ton.”

“If Congress fails to raise that ceiling then the U.S. housing market would most likely experience a severe double-dip contraction marked by much lower home sales and depressed house prices,” Christian E. Weller, a senior fellow at the liberal Center for American Progress, wrote in a white paper earlier this year. “That, in turn, would spark a return of the economic pain of the past few years for many families as foreclosures would remain at or near record highs, and jobs in key sectors, such as construction, would disappear again.”

Comment by rms
2011-07-28 21:57:32

The government has spent a tidy sum propping up the moribund housing market, but eventually the money will be depleted as the numerous boomer retirement onslaught gets underway in the next year or two meaning reduced consumer spending and high social expenses. The debt driven deflationary spiral will sap any remaining hope of a recovery on the horizon.

Comment by Professor Bear
2011-07-28 19:06:09

This sounds reminiscent of the August 2008 Credit Crunch.

July 28, 2011, 9:07 pm
Investment Banking | Legal/Regulatory

Debt Ceiling Impasse Rattles Short-Term Credit Markets

The reverberations of Washington’s impasse over a debt deal are already being felt in the short-term credit markets, a key artery of the economy that daily supplies trillions of dollars of credit.

Over the last week, big banks and companies have withdrawn $37.5 billion from money market funds that invest in Treasury debt and other ultra-safe securities, the biggest weekly drop this year. Meanwhile, in the vast market for repurchase agreements, in which many financial firms make short-term loans to one another, borrowers are beginning to demand higher yields.

These moves underscore how companies and big financial institutions are beginning to rethink their traditional view that notes issued by the United States Treasury are indistinguishable from cash, even though many experts say they think it is unlikely that the government would miss payments on its obligations.

The $37.5 billion drop, reported Thursday in a weekly survey by the Investment Company Institute, echoed what other analysts were seeing.

In the first three days of this week, investors pulled $17 billion from funds that invested only in government securities, a reversal of the daily inflows of $280 million for much of July, said Peter Crane, the president of Crane Data, which tracks money market mutual funds.

“It’s big, no doubt about it,” he said. “Seventeen billion isn’t a run, but it’s definitely indicative that investors are shifting their assets. If this were to continue for another week or two, it would be very disturbing.”

Comment by Professor Bear
2011-07-28 19:08:29

How the debt-ceiling crisis could affect ordinary Americans

A U.S. debt default could weigh on people’s financial lives in several ways, such as boosting interest rates on loans and denting already fragile retirement accounts if the stock market continues to tumble.

By Walter Hamilton, Nathaniel Popper and Tom Petruno, Los Angeles Times

July 29, 2011

The rancorous debate over lifting the debt ceiling that has engulfed Washington and Wall Street is increasingly threatening to intrude on the lives of American consumers and individual investors.

The risks were in clear view Thursday as the Dow Jones industrial average fell for the fifth straight session, putting the blue-chip index on track for its worst weekly decline in almost a year. A default on U.S. debt could weigh on people’s financial lives in a myriad of ways, such as boosting interest rates on mortgage loans and denting already fragile retirement accounts if the stock market continues to tumble.

Here’s a look at how the debt-ceiling crisis could affect ordinary Americans and small investors.

Comment by Darrell_in_PHX
2011-07-28 21:04:19

The downgrade is coming if we riase the debt limit or not. We have shown the world that we are incapable of compromise of the type that would be needed to fix our massive deficits before we’re truely insolvant.

Comment by Professor Bear
2011-07-28 22:58:06

I’m just not seeing those higher rates everyone keeps worrying about. The second dip in the recession should keep a lid on them, right?

How a Debt Downgrade May Affect Consumers
Joshua Lott for The New York Times
Pamela Garrett and Bob Morse viewed a house for sale in Phoenix with Nicole Eyerly, right, a real estate agent. A United States debt downgrade could cause home loans to grow more costly.
Published: July 26, 2011

Still, the talk in Washington of a federal budget crisis and possible default has given rise to all sorts of consumer fears of doomsday scenarios. Missed Social Security payments. Spikes in interest rates. Draconian cuts in government services.

But the most likely outcome, experts said in interviews this week, is that the nation’s credit rating will be downgraded a notch. And if that turns out to be the case, investors and borrowers should be able to ride out any volatility.

Over the last few days, financial advisers have tried to allay investor fears by sending notes to clients with the same message they have delivered in past periods of market uncertainty: As long as you’re diversified across different investments, the best action, in this case, is inaction.

The financial markets may become more volatile in the near-term, they say. And interest rates on several types of consumer loans can be expected to tick modestly higher because the rates track government-issued debt. But a credit downgrade is unlikely to cause a major shock to the system.

That said, the only investment that did not plunge in the 2008 market crisis was Treasuries, and they could conceivably lose some of their luster. “Sometimes I worry that a U.S. debt downgrade could have long-term negative psychological consequences as Americans realize the greatest power on earth is, alas, a mere mortal too,” said Milo Benningfield, a certified financial planner in San Francisco. But “we’re still looking pretty good relative to most everyone else in the world.”

That does not mean there will not be a wide ripple effect, at least in the short term. The magnitude of the deficit reductions and their effect on the broader economy are another wild card. But in the near term, here’s what investors and consumers can expect, and some advice from experts.

Comment by rms
2011-07-28 21:43:13

Gotta love that photo, lots of non-producing, well-paid pork bellies in suits milling about thinking they’re contributing something of value.

Comment by Professor Bear
2011-07-28 21:04:04

There is a wealth of info on foreclosures in the form of NODs in the legal section of the San Diego Suburban Classifieds.

Puzzling anomaly: EVERY NOD I have seen in a quick overview is in Poway (92064 zip code). Do they have more foreclosures per household than the rest of San Diego County for some reason?

Lots of Poway foreclosure homes are going to auction sale next month. A very limited smattering is offered below; there are more NODs currently listed than I have time or interest in manually processing.
If I were more motivated, perhaps I could figure out how to write a PERL script to hash through these.

DOT = Deed of Trust

DOT Date Auction Date Amount Owed Zestimate Address
14-Apr-05 10-Aug-11 $997,934.46 $858,000 17030 EDINA COURT, POWAY, CA 92064
8-Apr-04 11-Aug-11 $583,926.21 $576,700 16175 MARTINCOIT ROAD POWAY, CA 92064
11-Dec-06 11-Aug-11 $685,775.93 13837 Terrilee Drive, Poway, CA 92064
24-Aug-05 11-Aug-11 $438,430.35 $347,400 15123 AMSO ST POWAY, CA 92064
14-Apr-04 18-Aug-11 $275,335.35 $281,100 13671 COMUNA DRIVE, POWAY, CA, 92064
17-Mar-06 18-Aug-11 $783,823.94 $741,200 14033 DOGWOOD ROAD POWAY, CA 92064

Comment by Professor Bear
2011-07-28 22:51:24

Lost in the din over the debt crisis: HOW DID WE GET HERE?

1) Alan Greenspan’s “screw the middle class” FICA tax hike of 1983 was a stop-gap measure, insufficient to prepare for the demographic tsunami of baby boomer retirements.

2) W got us into two wars, and handed Upper Richistan a massive tax cut.

3) Now the Republicans are holding the line on the tax cut, we are still in the wars, and nobody in DC is willing to do anything about entitlements.

Meanwhile, the true believers are waxing poetic over the Tea Party’s uncompromising moment of glory. And when the economy crashes as a consequence of their intransigence, they will blame it on Obama.

JULY 29, 2011

Boehner’s Moment of Truth
The speaker has positioned his party to take credit for a bill that averts a crisis.


It isn’t easy to turn Washington around on a dime. If nothing else, give Republican House Speaker John Boehner marks for trying.

It wasn’t a week ago that Mr. Boehner was plodding through White House deliberations, grasping for GOP support, facing the growing likelihood his party would be saddled with either a flawed debt bargain or blame for causing a default. By last night, Mr. Boehner was on the precipice of passing the only workable debt plan in town and shifting responsibility for further debt fallout across the aisle. Whatever the final result, Mr. Boehner’s week-long struggle to pull his party behind him is worthy of some study.

That struggle began with the Ohio Republican’s willingness to pack in a losing strategy. He’d invested valuable time and capital in his White House talks, and the pressure from the president, the press and the bipartisan crowd to grab a “big deal” was enormous. He looked very near to succumbing to the seductive pull of a grand Washington “compromise.”

Instead, he realized that this White House had no intention of agreeing to serious debt reduction and that it cared primarily about tax hikes. His decision to call off the talks earned him some catcalls, but it reset the political dynamic.

Comment by Professor Bear
2011-07-28 22:52:24

One great outcome of this debt ceiling debate: Now everyone knows how wacky Flat Earther Michele Bachmann is. Hopefully this is enough to doom her prospects of ever gaining entry to the WH.

Comment by Professor Bear
2011-07-28 23:00:48

Why is it that only economists seem to recognize that the Tea Party bargaining position is unreasonable?

Op-Ed Columnist
The Centrist Cop-Out
Published: July 28, 2011

The facts of the crisis over the debt ceiling aren’t complicated. Republicans have, in effect, taken America hostage, threatening to undermine the economy and disrupt the essential business of government unless they get policy concessions they would never have been able to enact through legislation. And Democrats — who would have been justified in rejecting this extortion altogether — have, in fact, gone a long way toward meeting those Republican demands.

As I said, it’s not complicated. Yet many people in the news media apparently can’t bring themselves to acknowledge this simple reality. News reports portray the parties as equally intransigent; pundits fantasize about some kind of “centrist” uprising, as if the problem was too much partisanship on both sides.

Some of us have long complained about the cult of “balance,” the insistence on portraying both parties as equally wrong and equally at fault on any issue, never mind the facts. I joked long ago that if one party declared that the earth was flat, the headlines would read “Views Differ on Shape of Planet.” But would that cult still rule in a situation as stark as the one we now face, in which one party is clearly engaged in blackmail and the other is dickering over the size of the ransom?

The answer, it turns out, is yes. And this is no laughing matter: The cult of balance has played an important role in bringing us to the edge of disaster. For when reporting on political disputes always implies that both sides are to blame, there is no penalty for extremism. Voters won’t punish you for outrageous behavior if all they ever hear is that both sides are at fault.

Comment by Hwy50ina49Dodge
2011-07-29 00:46:56

Repubicans have, in effect, taken America hostage, threatening to undermine the economy and disrupt the essential business of government unless they get policy concessions they would never have been able to enact through legislation.

What a pleasant Patriotic thing to endeavor whilst the nation is battling in x2.2 Foreign Wars…pity that the CinC is a mulatto black Indonesia (non-hawaiian) who is doing his best to destroy America. :-)

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