The Housing Bubble

I guess I just have to acclimate myself to the new reality: that reality will never be addressed, ever, in financial news, despite all the crap of the last 10+ years.

Yesterday I was listening to KNX am1070 radio in Los Angeles with the business report, I think the dude’s name is Bob McCormick, and he was just gushing (he tends to gush) about the Case-Schiller Index being up for three straight months, and most importantly (his emphasis, not mine) Los Angeles real estate was part of the trend, and he said, that Case-Schiller said, that real estate in Los Angeles bottomed out in 2009. Somehow I don’t believe that the Case-Schiller report contains anything close to that statement.

And about two weeks ago I heard Chris Thornberg on the radio remarking that home prices have appeared to have bottomed out.

Spring was kind to home prices, but future isn’t bright
By Julie Schmit, USA TODAY

U.S. home prices rose 3.6% in the second quarter from the first, boosted by the spring buying season. But prices are expected to retreat this fall because of the struggling economy.

Even though prices rose quarter to quarter, they remain 5.9% below where they were last year, putting second-quarter U.S. home prices at 2003 levels, according to the Standard & Poor’s/Case-Shiller home price index released Tuesday.

The spring increase was widely expected, given long-standing buying patterns. When adjusted for seasonal factors, U.S. home prices in the second quarter were basically flat with the quarter before, the data show.

The fall outlook is grimmer, economists say, following shocks to consumer confidence stemming from the U.S. and European debt crises, U.S. stock market turmoil, high unemployment and anemic job growth. Consumer confidence tanked in August to its lowest level in two years, The Conference Board said Tuesday.

The drumbeat of bad economic news “increases the number of (home buyers) who’ll sit on the fence,” says Stan Humphries, chief economist for real estate website Zillow.

Signals are already pointing to weak numbers. Pending home sales slipped 1.3% in July from June, the National Association of Realtors reported this week. Existing home sales in July also slipped from June levels. For the week ending Aug. 19, the latest data available, applications for mortgages to buy homes fell to a 15-year-low, despite some of the lowest mortgage rates in decades, the Mortgage Bankers Association says.

Even before recent economic events, many economists expected home prices to continue to fall for much of this year. Zillow doesn’t expect prices to bottom nationally until 2012. Now, even that prediction may be too optimistic, Humphries says.

Wealthy Use Auctions to Sell Mansions After Price Cuts Fail
Bloomberg

David Sandwith has been trying to unload his seven-bedroom house on Mercer Island, Washington, since 2009, listing it first for $32 million, then cutting the price to $28.8 million last year. After not receiving any acceptable offers, he’s putting it up for auction.

“I have a growing family and I have opportunities that I want to pursue in my life, and that doesn’t necessarily mean that I will be located here in the greater Northwest,” Sandwith, 41, said in a telephone interview. “The time is right for us to sell the home.”

Real estate auctions, long used in the sale of foreclosed properties, are becoming more popular among wealthy homeowners to drum up interest for mansions that have languished on the market after the housing crash. In exchange for a quicker sale, many sellers are accepting price cuts of 50 percent or more.

Sandwith, a father of four who retired in 2007 after selling a family company, hired Gadsden, Alabama-based J.P. King Auction Co. to find a buyer for his 14,000-square-foot (1,300- square-meter) waterfront property. The sale, to be held today, doesn’t have an opening bid. The reserve auction will allow Sandwith to decline any offer he doesn’t deem high enough.
Mega-Mansions

“While our bread and butter are auctions for homes between $3 million and $8 million, calls for these mega-mansions have doubled this year,” said Caley King Newberry, a J.P. King spokeswoman. “Many didn’t have to sell when they wanted to in 2008 and 2009 because they had the holding power, but now they’ve decided it’s time to move on with their lives.”

At a J.P. King competitor, Grand Estates Auction Co., only about 12 percent of auctions are the result of financial distress, said Stacy Kirk Reich, president of the Charlotte, North Carolina-based company. The number of buyers has risen 130 percent since 2006, she said.

“Sellers will come to us for various reasons, maybe the death of a loved one or a divorce, but most frequently because they are reallocating wealth to other locations,” said Kirk Reich, whose company specializes in auctions of properties valued at $1.5 million to $10 million.

The company gets an average of 276 inquiries per listing and 16 bidders per auction.
Home-Price Decline

Homeowners are seeking new methods for selling their properties as the U.S. economy shows signs of sputtering. The Standard & Poor’s 500 Index has declined 6.4 percent in August, poised for its fourth straight month of losses. Morgan Stanley said on Aug. 18 that the U.S. and Europe are “dangerously close” to recession. The S&P/Case-Shiller index, a gauge of home prices in 20 U.S. cities, fell 4.5 percent in June from a year earlier, according to a report today.

The number of sales at Premiere Estates Auction Co., which sells luxury properties, rose 30 percent last year, said Anthony Fitzgerald, a broker with the Manhattan Beach, California-based company. He wouldn’t say how many homes the company sold. The gain is likely to be exceeded this year, he said.

“The actual dollar amount of homes auctioned off has also increased by about that much,” Fitzgerald said. “It means there are more auctions but there are also more high-end auctions. I think it’s fair to say that we’ve seen a 100 percent increase in opening bid prices.”
$22 Million

Premiere Estates is preparing the sale of a Malibu, California, beach estate owned by William Chadwick, a managing director at investment bank Chadwick Saylor & Co. The minimum bid is $22 million. With an original listing price of $65 million in 2008, it is the highest-priced home ever to go to auction, according to Fitzgerald.

At an open house in early August, about a dozen people at a time walked through the 10,500-square-foot, nine-and-a-half bathroom estate, which has five fireplaces, an ocean-view gym, a $1.5 million home theater with leather recliners, and a 75-foot (23-meter) lap pool on a 4,500-square-foot patio.

The home sits on “Billionaire Beach,” a stretch of Malibu officially known as Carbon Beach, where Jeffrey Katzenberg, chief executive officer of DreamWorks Animation SKG Inc., and Paul Allen, co-founder of Microsoft Corp. (MSFT), also have homes.

The home, which Chadwick built in 2005, is assessed at $6.08 million and the land at $2.45 million, according to public records. Chadwick bought the property from Pepperdine University in 2002 for $2 million, according to the Los Angeles County assessor’s office. The $22 million starting bid at the auction is based on recent sales of comparable properties in the area, Fitzgerald said.

Forbes

U.S. Bancorp, one of the nation’s biggest banks, became the latest large financial firm to sue Bank of America, filing a lawsuit over $1.75 billion of mortgage loans on Monday on behalf of investors of the loans.

Acting as trustee of a trust that included 4,400 mortgage loans originated by Bank of America’s Countrywide unit, U.S. Bancorp claims Bank of America, the biggest bank in the U.S., must repurchase loans in the mortgage pool because Countrywide had agreed to do so if it misled investors about the quality of the loans.

“The Trustee seeks to compel Countrywide, and Bank of America as its successor-in-interest, to specifically perform their obligation to repurchase all of the loans that the Trustee has submitted as breaching loans,” the lawsuit filed in New York state court in Manhattan says.

Realtors Are Liars®

U.S. mortgage applications tumbled last week: MBA

NEW YORK (Reuters) - Applications for U.S. home mortgages tumbled last week as demand for refinancing sagged for the second week in a row, an industry group said on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, dropped 9.6 percent in the week ended Aug 26.

The MBA’s seasonally adjusted index of refinancing applications slumped 12.2 percent, while the gauge of loan requests for home purchases edged up 0.9 percent after setting a 15-year low set the week before.

“Refinance application volume declined for a second week from recent highs, despite rates staying near a 10-month low, while purchase volume remained near 15-year lows,” Mike Fratantoni, MBA’s vice president of research and economics, said in a statement.

The refinance share of mortgage activity decreased to 77.8 percent of total applications from 79.8 percent.

Someone just forwarded me this horrid pun:

“Heard there was an earthquake in DC. Obviously the government’s fault.”

Meanwhile, Today’s Houses:

House 1: Reg’lar folk.

http://www.zillow.com/homedetails/3522-Olympic-St-Silver-Spring-MD-20906/37307948_zpid/#{scid=hdp-site-map-list-address}

Standard 1955 split level 4/1.5 split level. Pretty nice, actually. Good yard, middle-class kitchen, good commuter location. Obviously lived in and cared for by normal people.

Mar 1989: Sold $152K
May 2011: Listed $299K
Aug 2011: Listed $279K <— SERIOUS SELLER! sez the listing.
(but that’s an early 2004-era price.)

However, if a house like this is $279K (I’d lowball for $230K), then why are those half-trashed illegal-bedroom baby ramblers listing for $240K or so? They should be 100K less.

House 2: Fire that architect.

http://www.zillow.com/homedetails/14700-Pondside-Dr-Silver-Spring-MD-20906/37333935_zpid/#{scid=hdp-site-map-list-address}

It’s not a trainwreck disaster, just a colonial-style with bad taste in proportion. 1986 5/3 with rooms that are just too big, squeezed onto a 0.1 acre lot. I can’t figure out if there’s a front door. Guests are obviously meant to enter through the garage. I like the layout of the kitchen but that’s about it. The skeeter-infested pond and “glorious” gardens look like part of the development, so be sure to bring an HOA fee to the PITI party.

Jun 2001: Sold $268K
Jan 2005: Sold $485K
Oct 2010: Listed $540K
chase market down to
Aug 2011: Listed $399K <— probably worth about $350K.

The skeeter-infested pond and “glorious” gardens look like part of the development, so be sure to bring an HOA fee to the PITI party.

Planned layoffs decline in August: Challenger

NEW YORK (Reuters) - The number of planned layoffs at U.S. firms declined 23 percent in August after rising for three straight months, with the government sector again leading the job cuts, a report showed on Wednesday.

Employers announced 51,114 planned job cuts, down from 66,414 in July, according to the report from consultants Challenger, Gray & Christmas, Inc. Planned cuts in July had marked a 16-month high.

“In August, the private sector once again took a backseat to the government sector, which saw job cuts surge to the second highest monthly total this year,” John Challenger, chief executive officer of Challenger, Gray & Christmas, said in a statement.

But July’s planned job cuts were up 47 percent from August 2010, when they were at 34,768. For 2011 so far, employers have announced 363,334 cuts, somewhat better than the 374,121 cuts announced in the first eight months of 2010.

More job cuts are expected at the federal government level with pressure to cut the federal budget, the report said.

Cuts in the government sector accounted for 18,426 of the announced layoffs in August, and 105,406 for the year so far.

“Meanwhile, the private sector is still being hampered by low consumer and business spending. While we do not see any indication of a sudden resurgence in private-sector job cuts, conditions definitely are not ideal for hiring,” said Challenger.

AT&T to bring 5,000 jobs to US if T-Mobile bid OKd

And I’d be stunned if they actually bring back the jobs. Or, they’ll bring them back for a year, and then re-outsource them anyway. Or hire 5000 and outsource 10000 later. C’mon, federal regulators… do the right thing…

Obama just created the newest Al-Qaeda country…

——————-

Tripoli divided as rebels jostle over power
msnbc | 8/31/2011 | DAVID D. KIRKPATRICK and ROD NORDLAND/NY Times

Fighters from the western mountain city of Zintan control the airport. The fighters from Misurata guard the central bank, the port and the prime minister’s office, where their graffiti has relabeled the historic plaza “Misurata Square.” Berbers from the mountain town Yafran took charge of the city’s central square, where they spray-painted “Yafran Revolutionaries.”

A week after rebels broke into Col. Muammar el-Qaddafi’s former stronghold, much of its territory remains divided into fiefs, each controlled by quasi-independent brigades representing different geographic areas of the country. And the spray paint they use to mark their territory tells the story of a looming leadership crisis in the capital, Tripoli.

The top civilian officials of the Libyan rebels’ Transitional National Council — now styling itself as a provisional government to be based in the capital — are yet to arrive, citing personal safety concerns even as they pronounce the city fully secure.

,,,,,,,

Several liberals among the rebel leadership council complained privately that Mr. Hasadi had been a leader of the disbanded Libyan Islamist Fighting Group, which rebelled against Colonel Qaddafi in the 1990s. Some said they feared it was the first step in an attempt at an Islamist takeover. They noted that Mr. Hasadi was named commander by the five battalions of the so-called Tripoli Brigade, rather than by any civilian authority. And they complained about the perceived influence of Qatar, which helped train and equip the Tripoli Brigade and also finances Al Jazeera.

The Associated Press
August 30, 2011, 6:49AM ET
Consumer confidence expected to drop in August
By ANNE D’INNOCENZIO
NEW YORK

Consumer confidence likely dropped in August as worries about the economy fueled the widest stock market swings since the financial meltdown in 2008.

The souring mood raises concerns about shoppers’ ability to spend during the critical back-to-school season.

Economists surveyed by FactSet expect that the Conference Board, a private research group, will report Tuesday that consumer confidence fell to 53.3 this month, down from 59.5 in July. That would be its lowest point since October 2010, when confidence was at 49.9. The July reading was up slightly after two months of declines.

The index measures how shoppers feel about business conditions, the job market and the next six months. It had been recovering fitfully since hitting an all-time low of 25.3 in February 2009.

A reading above 90 indicates the economy is on solid footing; above 100 signals strong growth. Economists watch the number closely because consumer spending including major items like health care, accounts for about 70 percent of U.S. economic activity.

The report is expected at 10 a.m. EDT.

“Consumers are realizing that economic conditions are not likely to get a whole lot better soon,” said Mark Vitner, senior economist at Wells Fargo Bank.

With the nation’s unemployment rate stuck at 9 percent and home values still weak, there’s not much to be confident about, he said. Shoppers also face rising costs for everything from food to gas, and they’re paying more this fall for clothing as merchants make up for higher labor costs in China and a spike in raw materials costs.

The Conference Board index — based on a random survey of consumers sent to 5,000 households from Aug. 1 to Aug. 18 — captured the wildest week on Wall Street since the financial crisis in 2008.

Four days into the survey period, on Aug. 5, Standard & Poor downgraded the U.S. federal debt and concern revived about the health of European banks. The Dow Jones industrial average had four 400-point swings in a row for the first time in its 115-year history during the week that ended Aug. 12.

The Dow Jones industrial average has fallen 9.3 percent since its recent peak on July 21. It is down 0.3 percent for the year. Standard & Poor’s 500-stock index has fallen 10 percent since July 21 and remains down 3.8 percent for the year.
…

Several companies have run into problems with the big call centers in the deep South of the USA ,many folks just cannot understand the Southern twang or drawl ,or whatever you call it . This runs across all ethnic groups , and is a problem the Companies will not admit , they just move the centers off someplace where it is cold in winters.

Subprime mortgage bonds are now more “too-big-to-fail” than U.S. Treasurys?

Go figure…

Bloomberg
Subprime Mortgage Bonds Get AAA Rating From S&P Denied to U.S.
August 30, 2011, 8:22 PM EDT
By Zeke Faux and Jody Shenn

Aug. 31 (Bloomberg) — Standard & Poor’s is giving a higher rating to securities backed by subprime home loans, the same type of investments that led to the worst financial crisis since the Great Depression, than it assigns the U.S. government.

S&P is poised to provide AAA grades to 59 percent of Springleaf Mortgage Loan Trust 2011-1, a set of bonds tied to $497 million lent to homeowners with below-average credit scores and almost no equity in their properties. New York-based S&P stripped the U.S. of its top rank on Aug. 5, saying Washington politics were making the country less creditworthy.

Treasuries gained about 1.95 percent and U.S. borrowing costs have fallen to record lows as investors repudiated the downgrade, according to Bank of America Merrill Lynch indexes. S&P has awarded AAAs to more than $36 billion of securities in the U.S. this year that were created by bankers who continue to gather thousands of loans, bundle them into bonds of varying risk and pay ratings firms a fee to assign credit rankings.

“Everybody has been led to believe over the years that AAA means AAA means AAA across the board,” Gregory W. Smith, the general counsel for the $41 billion Public Employees’ Retirement Association of Colorado, said in a telephone interview on Aug. 24. “Anybody that didn’t learn in the 2008 crisis that doesn’t apply should find another line of work.”
…

“I’m not debt yet.”

Bloomberg
Long Bond Shows No Double Dip in Widening Treasury Curve
August 29, 2011, 3:05 PM EDT
By Cordell Eddings

Aug. 29 (Bloomberg) — Bond investors are backing Federal Reserve Chairman Ben S. Bernanke’s forecast that the U.S. will avoid another recession.

The economy has never contracted with the difference between 10- and 30-year Treasury yields as wide as the current 1.34 percentage points, or 134 basis points, since the so-called long bond was first issued in 1977. The gap, which is more than double the 49 basis-point average of the past 20 years, has ranged from negative 56 to positive 41.9 at the start of the last five recessions, beginning in January 1980.

While reports this month showed manufacturing dropped to a two-year low and the worst consumer confidence since November 2008, investors say the Fed’s pledge to keep interest rates near zero until mid-2013 will underpin growth. The Commerce Department may say today that personal spending, which accounts for about 70 percent of the economy, rose 0.5 percent in July, above the 0.3 percent average since 2000, according to the median of more than 60 estimates in a Bloomberg News survey.

“There is a lot of fear, but U.S. growth is not dead,” Andrew Richman, who oversees $10 billion as a strategist in Palm Beach, Florida, for SunTrust Bank’s private wealth management division, said in an Aug. 26 interview.
…

Wall Street Haunted by ‘08 Loses Risk Appetite: Credit Markets
August 29, 2011, 9:51 AM EDT
By Shannon D. Harrington

Aug. 29 (Bloomberg) — Wall Street traders are demanding the biggest premiums to buy and sell credit in almost two years as they seek protections from market swings driven by Europe’s debt crisis and a slowing global economy.

A measure of the cost of trading credit-default swaps has tripled this month as prices gyrate the most in 13 months, according to data compiled by Bloomberg and CMA in London. Amid the volatility, the biggest bond dealers cut their holdings of corporate securities to $73.1 billion as of Aug. 17, the least since July 2009, Federal Reserve data show.

The surge underscores the fragility of credit markets three years after the collapse of Lehman Brothers Holdings Inc. triggered the biggest corporate bond losses in at least 35 years. With junk-rated securities poised to lose the most this month since November 2008, banks and investors are bracing for broader declines on concern Europe’s fiscal imbalances will infect the banking system at a time when the economy may not be strong enough to withstand such headwinds.
…

Bank debt vultures need to curb their appetites for now, or else run the risk of catching themselves falling knives.

Bloomberg
‘Too Early’ for Bank Debt as Housing Weakens, Seix’s Keegan Says
August 30, 2011, 2:28 PM EDT
By Sapna Maheshwari

Aug. 30 (Bloomberg) — Investors shouldn’t load up on financial bonds even after the worst declines in 30 months because home prices may drop further as the economy slows, said Seix Investment Advisors Inc. Chief Investment Officer Jim Keegan.

“It’s a little early,” said Keeegan, whose firm manages about $27 billion from Upper Saddle River, New Jersey, and reduced its bank bond holdings toward the end of the second quarter. “We’re in the process of re-examining our outlook on housing prices and may take that estimate down even further,” said Keegan, whose $729 million RidgeWorth Total Return Bond Fund has beaten 99 percent of its peers in the past month.
…

Did Bernanke actually suggest more stimulus was on the way in his Jackson Hole speech, or is this merely an example of Fed cargo cult wishful thinking?

Bloomberg
U.S. Company Credit Risk Falls on Speculation About Fed Stimulus
August 30, 2011, 6:00 PM EDT
By Mary Childs

Aug. 30 (Bloomberg) — A benchmark gauge of U.S. corporate credit risk fell today, contributing toward the biggest two-day drop in more than eight months on speculation the Federal Reserve will enact more stimulus to safeguard the recovery.
…

http://joongangdaily.joins.com/article/view.asp?aid=2940729

(similar story on MSNBC)

A virtual store with no products

————–
*Amazon does this today.
**As late as the 1970’s, stores had to put up a “cash and carry” sign to inform the elderly that it was a cash-and-carry store.

U.S. Companies Add Fewer-Than-Estimated 91,000 Workers in August, ADP Says
By Bob Willis - Aug 31, 2011 5:39 AM PT

Companies in the U.S. added 91,000 workers to payrolls in August, according to a private survey.

The increase followed a revised 109,000 gain the prior month, according to data from ADP Employer Services. The median forecast of economists surveyed by Bloomberg News called for an advance of 100,000.

The economy needs to generate more jobs on a sustained basis in order to bring down unemployment, which has been at 9 percent or higher in 25 of the past 27 months. A Labor Department report in two days is projected to show businesses added 100,000 jobs in August, down from a 154,000 increase in July, according to the median forecast of economists surveyed by Bloomberg.

“The labor market continues to struggle,” Sean Incremona, a senior economist at 4Cast Inc. in New York, said before the report. “There is too much uncertainty that is restraining firms from committing resources to hiring.”
…

http://money.cnn.com/2011/08/31/real_estate/housing_market_foreclosures/index.htm?source=cnn_bin

“….Four years into the housing crisis, the real estate market is still teetering on the edge. The Obama administration has tried one program after another to stem the tide of foreclosures with limited success. And it is continuing….”

Four years?

Are CEOs, enabled by ginormous paychecks and the SCOTUS redefinition of “free speech,” effectively morphing into the U.S. federal government?

Or am I talking here about the barn door that was long ago left open?

Aug. 31, 2011, 8:57 a.m. EDT
Some firms paid more to CEOs than to tax man
By Greg Morcroft

NEW YORK (MarketWatch)– NEW YORK (MarketWatch) — Twenty-five of the 100 firms that paid their CEOS the most last year paid those executives more than they paid in total taxes, according to a report published recently.
…

NY is number one!

http://www.lpsvcs.com/LPSCorporateInformation/ResourceCenter/PressResources/MortgageMonitor/201107MortgageMonitor/LPSMortgage%20Monitor072011.pdf

57 years of house foreclosure inventory in the pipeline. No wonder prices haven’t crashed here yet. I am wondering how a situation like this can get resolved. Naturally, I would like to see this inventory spill out like the Johnstown flood. What is the cause for NY/NJ having such a gargantuan backlog?

For those who missed it yesterday:

New JoshuaTree Extension out which supports Firefox 6.0. In addition, Frontier has finally taken over web hosting from Verizon and it turns out they have their shit together. So you don’t have to right-click the link and save, but can simply click on it and it will install correctly (well, at least in FF6. I didn’t test this in 5.X).

Note that the link has changed - the old URL will simply redirect to this one:

http://myplace.frontier.com/~drumminj_tx/joshuatree.html

I have thought about the proposal to let underwater home owners refinance their pre-bubble mortgages @ 4% and I think it would net-net be positive for the middle class, especially if the loans were transferable to future 1st. time buyers. That, along with cutting off the MID at $150k and closing loopholes on second home and investment RE properties would lop off 1-2 trillion in future revenue shortfalls in 10-15 years.

I am a so glad to see the Obama administration block the ATT T-mobil merger. We really don’t need a bigger ATT or Verizon. Mergers destroy jobs and concentrate wealth. (I’m a share holder too)

Solyndra to Declare Bankruptcy
By Scott McGrew Aug 31, 2011 | NBC Bay Area

Solyndra — recently touted as an innovator by President Obama — is reportedly shutting its doors. Employees are being turned away this morning.

Solyndra, a major manufacturer of solar technology in Fremont, has shut its doors, according to employees at the campus.

“I was told by a security guard to get my [stuff] and leave,” one employee said. The company employs a little more than 1,000 employees worldwide, according to its website.

Shortly after it opened a massive $700 million facility, it canceled plans for a public stock offering earlier this year and warned it would be in significant trouble if federal loan guarantees did not go through.

The company has said it will make a statement at 9am California time, though it’s not clear what that statement will be. An NBC Bay Area photographer on the scene reports security guards are not letting visitors on campus. He says “people are standing around in disbelief.” The employees have been given yellow envelopes with instructions on how to get their last checks.

Solyndra was touted by the Obama administration as a prime example of how green technology could deliver jobs. The President visited the facility in May of last year and said “it is just a testament to American ingenuity and dynamism and the fact that we continue to have the best universities in the world, the best technology in the world, and most importantly the best workers in the world. And you guys all represent that. ”

The federal government offered $535 million in low cost loan guarantees from the Department of Energy. NBC Bay Area has contacted the White House asking for a statement.

Some Republicans have been very critical of the loans. “I am concerned that the DOE is providing loans and loan guarantees to firms that aren’t capable of competing in the global market, even with government subsidies” Florida Congressman Cliff Stearns told the New York Times.

inflation and zimbabwe

from wikipedia

Between 2000 and December 2007, the national economy contracted by as much as 40%; inflation vaulted to over 66,000%, and there were persistent shortages of hard currency, fiat currency, fuel, medicine, and food. GDP per capita dropped by 40%, agricultural output dropped by 51% and industrial production dropped by 47%.

The point - printing money won’t increase GDP or tax revenue once people have depleted savings, can’t increase household income, and can’t borrow more money, and are already spending all they make on food and fuel. Economic collapse will occur gutting all demand and causing 80% unemployment. They noted in the wikipedia that in 2006 a nurses daily pay was less than the price of a soda pop. Once daily pay does not cover transportation and fuel people stop going to work and turn to crime.

The people of LA are being asked to finance a stadium for a billionaire with all the profit going to him and all the risk to the taxpayer.The media of course is all supportive of this horrible plan with hardly a naysayer in the bunch, it shameful and sad to see this happening.
They will pay the city back w/ expected revenues from the stadium( rosy perdictions) these perdictions are 230,000,000 over 30 years that 7,000,000 a year,thats not an asset it is a liability w/ AEG risking none of their own money only the taxpayers money. AEG has negotiated this deal w/ the dumbest people on the block our city council and the mayor. they have had the smartest,highest paid people going up against our council members and mayor who only want free tickets.This is a bad deal for the city of LA, may i remind the mayor and council that they are in the drivers seat not AEG…The NFL needs LA…we the citizens must scream loud and hard to stop this give away to a billionaire, and mayor Villagrosa wants higher office in this country,never vote for him…

Thanks to whoever recommended “The secret of Oz” on youtube. I just finished watching it this morning and I must say that it was very informative. Thanks. I am getting ready to watch The Money Masters next. I would like to see Too Big to Fail, but I don’t have HBO.

From the “How far has X-GSfixr gone down the crapper?” file.

Brother is getting married in Las Vegas this weekend. Have had this trip planned for six months.

It only occurred to me today that with weddings come bridesmaids……and friends of the bride. Since the bride is in her mid-late 30s, I’m assuming most of her friends are approximately the same age.

Me……single, 50 something guy (but I look younger)

In Vegas, with a bunch of 30-40 something friends of the bride.

And here I was, thinking about going to see the “Blue Man Group”…….my testostrone gage must be bouncing on “E”……….

Read a story that J.P. Morgan wrote that it expects QE III to begin on September 21, 2011. Earlier, I read that Morgan expected gold to reach $2500 by the end of the year. Wonder if there is any relationship between the two stories? sarcasm off. Let see a few years ago, a $200,000 house would cost you 200 Oz of gold. At 2500 per Oz, it would cost 80 Oz. There is your housing price collapse. Too bad we are paid in fiat dollars and not gold.

And now for something totally off-topic.

“As of Tuesday, August 30, 2011, at least 4,474 members of the U.S. military had died in the Iraq war since it began in March 2003, according to an Associated Press count.”

Let’s see. 130K troops took part in the initial invasion. Peak troop count was about 160K in 2005. They kept talking that drawdown was iminant, but in 2008 there were still 140K. When the multi-national force stood down at the end of 2009, there were still over 110K US troops in Iraq. End of 2011 is the final, final deadline to have all combat troops out of Iraq except we now expect ALL OUT to mean all but abuot 15,000-20,000.

So, let’s say that we averaged something like 125K troops in Iraq for 8 years. That is a nice round, 1 million man years. That would mean we have expereinced 474 deaths per 100,000 per year.

Well, in the United States, 20-something males have a death rate of about 140 per 100K per year. That means that statistically speaking, 1400 of those 4500-ish of those killed would be dead anyway.

In short, a 20-y/o having participated in the invasion, then having been stationed in Iraq for 8 years after, would have been only 3x more likely you would have died than had they lived in the USA for that time.

Compare to WWII. 16 million total served, but peak was 12 million. Best I could find made it look like we averaged 10 million for 4 years. 40 million man years. Do not have any idea what % of those were stateside vs. deployed to war zone.

We lost 416,800 military deaths. About 1050 deaths per 100K. So, just being in the military during WWII was 2.5x as deadly as being stationed in Iraq during the last 8 years.

Fun with statistics.

Ron Paul on Talk of the Nation (NPR) today. I think he handled the FEMA issue well. He said it should be handled by the states. I was a little leery of that comment, but it was his follow-up comment that hooked me. Bring the troops home from this disaster of a war, saving $10B/month, and re-allocate individual National Guard troops (who have been mis-allocated to the wars) to assist and take over FEMA’s role.

As of right now, it’s full crackpot ticket for me in 2012:
Paul / Kucinich 2012

Fed’s Lockhart: No Policy Can Be Ruled Out
Bloomberg

Federal Reserve Bank of Atlanta President Dennis Lockhart said the Fed should be ready to consider more monetary easing even while it can’t be expected to eliminate some of the forces impeding economic growth.

“Given the weak data we’ve seen recently and considering the rising concern about chronic slow growth or worse, I don’t think any policy option can be ruled out at the moment,” Lockhart said today in the text of a speech in Lafayette, Louisiana. “However, it is important that monetary policy not be seen as a panacea.”

I really really don’t think the answers lie in taking money from the people that can afford it the least . At this point the issue is where are the heists .

The point is there were grand heists that were obtained by Ponzi-schemes that crashed . So ,it was ill gotten gain ,just like in the case of Madoff . No different than Madoff in that it was a rigged system that transferred the lions share of the wealth upward to a class that
has been protected in all this mess .

Go back and charge a Ponzi-scheme retroactive tax . I’m serious .
Who made out like bandits because of the rigged system that crashed .

Transfering the pain to the 85 % of the population and letting rich Corporations or culprits off the hook is not the answer .

Ask what the culprits can do for this Country .

Warren Buffet says tax him now . i say Warren Buffet profited from a rigged Ponzi scheme ,therefore his money is the byproduct of ill gotten gain for about 20 years .

They have PR programsw in the Main stream news now that counsel people on accepting getting screwed ,as if its a problem with the people not accepting being screwed .

When people say give up give up ,its because someone else wants to take it ,or don’t want it taken from them .

How do you get the system balanced again ?

They said in the news they are taking 70 state parks in California .

Is everybody going to wait for every single thing being taken from the
85 % just so some billionaire can have 10 Mansions instead of 2 .

Whats wrong with a high percentage of the population having a decent lifestyle ? They would like you to think that the majority of the population is being bitchy wanting a decent lifestyle .

The children should take care of the seniors ,not the Social Security they were promised . take ,take take ,but don;t take from the
Raiders of America .

Is everybody going to feel better when they are proverty stricken
working your hands to the bones for peanuts ?

I’m serious ,this is just one big con job .

“No recession here in Canada…”

Economy contracts for first time since recession
Tavia Grant
Globe and Mail Update
Published Wednesday, Aug. 31, 2011 8:47AM EDT
Last updated Wednesday, Aug. 31, 2011 2:58PM EDT

The Canadian economy shrank 0.4 per cent in the second quarter of the year, the first contraction since the recession, as supply disruptions slammed exports.

The country’s gross domestic product registered a sharp slowdown in the April to June period after a revised 3.6-per-cent reading in the first quarter of the year, Statistics Canada said Wednesday.

The slump reflects a number of temporary factors, as wildfires in northern Alberta and maintenance shutdowns sliced oil productions and Japan’s tsunami caused supply disruptions. Details of the report – which show activity picked up at the end of the quarter – suggest Canada will not fall back into a recession, economists said.

“While the headline number is disappointing, the details of the report are more upbeat, and do not signal a recession,” said Diana Petramala, economist at Toronto Dominion Bank.

“Look for a better third quarter,” said Jennifer Lee, senior economist at BMO Nesbitt Burns in a note.
…

DOW turns positive for 2011! Ain’t no stop’n us now… we’re on the move! DOW 12,000 here we come…Buy now or be priced out forever! The street sez… The QE-3 is getting ready to launch! Goldman-Sux told BB to STFU and print, baby print! But none for the serfs.

Great name this caring group has…

ITEM: HIV/AIDS group charged with diverting tax dollars to strip club
The Washington Examiner

D.C. Attorney General Irvin Nathan has accused a District HIV/AIDS service provider of spending nearly $330,000 in federal tax dollars to open a strip club.

In a lawsuit filed Tuesday, Nathan said Miracle Hands Inc. promised the city it was using the cash to renovate a warehouse in Northeast for use as a job training center for residents with HIV/AIDS. Instead, the warehouse was turned into the Stadium Club, a strip club that continues to operate, the suit says. Miracle Hands shares an address with the club, according to the company’s website. Nathan asked in the suit that the city be awarded at least $988,959 in damages.

D.C. Councilman David Catania requested in a February letter to Nathan that the attorney general open an investigation into Miracle Hands and its relationship with Stadium Club.

“I am pleased that the attorney general has decided to take action regarding this egregious impropriety,” Catania said Tuesday.

Attempts to reach Miracle Hands owner Cornell Jones were not successful. Jones is a self-described former D.C. drug kingpin with convictions for narcotics distribution on his record.

Solar company to file for bankruptcy despite $535 million loan guarantee

By Andrew Restuccia - 08/31/11 12:45 PM ET

“Regulatory and policy uncertainties in recent months created significant near-term excess supply and price erosion,” Solyndra’s CEO said.

A California-based solar company that received a $535 million loan guarantee from the Obama administration announced Wednesday that it will shut down.

The company, Solyndra Inc., said Wednesday it would suspend its manufacturing operations and lay off 1,100 employees effective immediately. The company said it intends to file a petition for Chapter 11 bankruptcy protection.

“Regulatory and policy uncertainties in recent months created significant near-term excess supply and price erosion,” Solyndra CEO Brian Harrison said in a statement. “Raising incremental capital in this environment was not possible. This was an unexpected outcome and is most unfortunate.”

The announcement comes at a tough time for the solar industry, which has faced free-falling solar panel prices.

But the Obama administration has doubled-down on its investments in the industry. The Energy Department finalized last week an $852 million loan guarantee for a separate California solar project sponsored by NextEra Energy. Earlier in August, DOE finalized a $197 million loan guarantee for solar manufacturing facilities in Oregon and California.

Solyndra received the $535 million stimulus loan guarantee from the Energy Department in 2009 to help finance the construction of a new plant to manufacture solar panels.

The Energy Department said Wednesday that it is “disappointed” that Solyndra is shutting down its manufacturing operations, but added, “We continue to believe the clean energy jobs race is one that America can, must and will win.”



“We have always recognized that not every one of the innovative companies supported by our loans and loan guarantees would succeed, but we can’t stop investing in game-changing technologies that are key to America’s leadership in the global economy,” said Dan Leistikow, director of the office of public affairs, in a blog post Wednesday. 


http://thehill.com/blogs/e2-wire/677-e2-wire/179005-solar-company-that-received-obama-administration-support-to-close-its-doors -

http://realestate.msn.com/more-short-sales-bring-new-scam-flopping?page=2

Question(s):

Has anyone tried to rent a home in their particular market recently? If so, how was the experience? Lots of supply? No supply? High rents? Low rents? Just curious as to what people are seeing out there. I’ve heard a few anecdotes recently and trying to expand my sample set…

LaDainian Tomlinson’s Poway mansion is for sale:

“Tomlinson has placed his 9,564-square-foot Poway home, built in 2004, on the market. Asking price: $5.2 million. Annual taxes: $40,398.”

http://www.signonsandiego.com/news/2011/aug/31/tomlinsons-poway-home-sale/

http://www.antigenrealty.com/properties_detail1/106/SanDiegoChargersHouseSanDiegoChargersHomesCelebrityHomesRealEstate

From the pics, that’s one nice spread.

San Diego’s McMillin Realty lays off workers
Written by Lily Leung
6 a.m., Aug. 30, 2011

McMillin Realty, a longtime housing presence in San Diego, recently laid off 11 workers to “reposition” the company, said Sandy Perlatti, senior vice president of marketing at the Corky McMillin Companies.

The layoffs included: five employees in administrative and accounting roles, one in land development, two in asset management, (a job that will be outsourced,) one in land acquisition, one in project finance and one in the in-house legal department. In all, 412 people work at the company, which has four offices: two in Bonita, one in Chula Vista and another in San Diego.

“The recovery has not been as robust as we would’ve hoped,” said Perlatti, who has been with the company 30-plus years. “…There was trimming in all areas…so the company can be well positioned to go into the future.”
…

California is one of the best places in the U.S.A. for a small business to go bankrupt.

More San Diego businesses going bankrupt
Written by Tanya Mannes
6 a.m., Aug. 29, 2011

The number of San Diego County small businesses filing for bankruptcy has nearly doubled since the first quarter of 2008, says a report by Equifax.

San Diego ranked fourth among U.S. metro areas with 400 small businesses going bankrupt in the first quarter of this year, compared with 208 in the first quarter of 2008, said the report released last week. Equifax classifies a small business as a commercial entity of less than 100 employees.

The pace of bankruptcy filings appears to be slowing in most of the nation, but is increasing slightly in San Diego compared with last year, the report said.

Bankruptcy trends serve as a valuable prism through which to evaluate the credit health of today’s small business market,” said Dr. Reza Barazesh, senior vice president of Equifax Commercial Information Solutions.

“Our latest analysis shows that while business failures may be on the decline, conflicting trends are still making us question if the worst is behind us,” Barazesh said. “Only time will tell if these patterns are just a market aberration resulting from current economic turbulence or a sign of change to come.”

The top five areas for bankruptcies were:

• Los Angeles-Long Beach-Glendale, 1,048

• Riverside-San Bernardino-Ontario, 629

• Sacramento-Arden-Arcade-Roseville, 434

• San Diego-Carlsbad-San Marcos, 400

• Houston-Sugar Land-Baytown, Texas, 363

How could the “nobody could have seen it coming” set possibly make buckets of dough through pulling the wool over the sheeples’ eyes if the public were adequately alerted to looming financial catastrophes?

Let’s call it Hurricane Euro
By David Frum
Marketplace, Wednesday, August 31, 2011

Hurricane Irene could cause more than $10 billion in damage. But there’s another storm brewing that might cost more.
Commentator David Frum

David Frum: For a weekend, Hurricane Irene transfixed media attention.

Kai Ryssdal: Commentator David Frum.

Frum: National networks as well as local news — they reported breathlessly minute by minute the progress of the storm.

And you know what? While some of the reporting was silly, the shows by and large did a public service. People took precautions. The barrage of warnings had a positive effect.

But why is it only weather stories that command such breathless attention?

Meanwhile, the world’s largest currency union — the euro — continues to careen toward disaster. The euro’s travails weigh heavily on the United States’ economy too. Yet just try getting anybody interested in that outside specialized financial media.

Day by day, week by week, the fiscal and monetary authorities in Europe are making decisions–mostly very bad decisions — that are hastening the day when a southern European country either quits the euro or is ejected. That would be followed by debt defaults and bank failures — bank failures that may well contaminate non-European banks as well.

It’s not a sure thing. But then neither was the flooding of lower Manhattan by Irene a sure thing. We still worried. We still took precautions. And when we got lucky, we were glad to have paid attention.

Yet where is the minute-by-minute coverage of our financial exposure? If the worst happens, it will happen for most Americans out of a wild blue yonder — just as the crash of the housing bubble did.
…

The Financial Times
MARKETS
Poverty overshadows Las Vegas lights
August 31, 2011 6:55 AM

Leading the country in foreclosures and unemployment, the FT’s Matthew Garrahan examines how Las Vegas is coping. Away from the bright lights and gaming palaces, a lack of jobs and the housing collapse has exacerbated its poverty crisis leaving nearly 300,000 people without the proper resources to eat. (4m 28sec)