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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Where are we by now in the Housing Bubble collapse / recovery process?
San Diego Housing Market Continues To Struggle
By Erik Anderson
September 14, 2011
SAN DIEGO — More than 3,200 homes were sold in San Diego County in August, according to the San Diego-based real estate tracking firm Dataquick.
…
Home sales were up, but they remain well below the monthly average for this time of year. August is typically the busiest month of the year for home sales.
Last month’s home sales were half what they were in August 2003, when the market was in balance. Even so, last month’s sales numbers were higher than July and last August.
Distressed sales also play a role in the local housing market.
“We see an increase in the notice of default filings the first step in the foreclosure process during August,” said LaPage. “It was a rather sharp increase. It’s just unclear whether that was a blip or the beginning of a new trend.”
Homes prices in Southern California have declined for the last two months and have been down year-over-year for the last six months.
“Where are we by now in the Housing Bubble collapse / recovery process?”
According to the local news around here, we’re well into the building recovery. Local TV reporting that home building has really picked up in the northern suburbs of Cincinnati. The pickup started about 4 months ago according to builders, and they’ve got all the work they can handle.
Oil City doesn’t sound so bad now, does it?
After they laided of 75% of staff.. .
and they’ve got all the work they can handle.
Residential builders have fired up their hammers again locally too. I’ve also seen spec homes hitting the market recently and their prices are just crazy. Those niches are already bloated but perhaps they feel new has an advantage.
I seem to be running into more realtor owned properties on the market than I remember running into previously. Anecdotal but who knows.
There is one financing item. I reported that local building had been going gangbusters all summer / spring. Well one particularly large project appears to have ground to a halt. I have seen nothing about what is going on in the news but we’ve noticed no activity there for at least 3-4 weeks. Hmmmm. The abandoned lot will be a real scar on the supposedly updated neighborhood. We think it’s uglier than the deteriorating structures they tore down to make it happen.
Sounds like lower home prices are headed to Cincy, thanks to a combination of new home supply and a broke back national labor market.
More like “home prices will remain in check”.
Yes, they are building smaller houses, but I think what we are seeing around here is a migration from older stock to new stock. In general, people here think newer is better than used, and are willing to pay a premium for it. As a result, new housing sells and older homes sit for awhile. Not sure what the premium is, but it’s high enough to sell all of the new-builds, but not so high as to reach excape velocity of the (sagging) value of the existing housing stock.
The marginal housing (like yesterday’s ‘Oil City’ example 7 miles from my house) are dropping fast. But unlike the rest of Ohio, Cininnati’s metro population is growing. The building is taking as the contiguous farmland gets turned into bland subdivision. But since the jobs are migrating out of inner Cincy and inner Dayton, the jobs and the housing are moving together.
“Last month’s home sales were half what they were in August 2003, when the market was in balance.”
PB, did the market seem “in balance” to you in 2003 in San Diego?
In Seattle, I thought it was INSANE in 2003—bidding wars everywhere, very low inventory, and prices had gone up about 20% over the previous year. I thought it couldn’t possibly last, but it did much longer than I thought possible at the time.
p.s. If they really think the market was “in balance” back in 2003, perhaps we are still in the denial phase?
We came here in 2004, and had the sense to immediately commence renting when we discovered $400K would only buy you a crappy condo.
I was in Leucadia in 1999-2005, in a beautiful 1,100 sf rental 2 blocks from the beach with a front & backyard garden [landlord was way cool!], watched as they ripped out a 600 sf cottages on long narrow lots left & right replaced by x6 hi-den$ity units for sale at $800,000+…each.
Eyes still laughing today: Sept 16th 2011
BWAHAHAHicHAHAHicHAHAHAHAHicHAHAHic* (DennisN™)
(micro-brew beer with a homemade egg-bacon-avocado sandwich post; coffee, toast, & joe’s O’s wee-am hours)
Isn’t it better to be a leader in something, than in nothing whatsoever?
New foreclosures surge during August in hardest-hit markets
California leads in new foreclosure proceedings with an increase of 55% over July. Metro areas in the inland parts of California post big jumps, with Riverside and San Bernardino counties soaring 68%.
By Alejandro Lazo, Los Angeles Times
September 15, 2011
Significantly more properties entered the foreclosure process during August in the nation’s hardest-hit markets, including battered parts of inland California and other areas in the West, as Bank of America Corp. stepped up its activity in states where a court order is not needed to take back a home.
Among the states with the highest foreclosure rates, California led the pack in new foreclosure proceedings with an increase of 55% over July, according to data from Irvine-based RealtyTrac. Metro areas in the inland parts of California posted big jumps, with Riverside and San Bernardino counties soaring 68%, Bakersfield 44% and Modesto 57%, the real estate information company said.
A separate report found crosscurrents in Southern California’s housing market during August, with sales increasing but prices continuing to fall.
Sales were up 8.6% from July and 6% from August 2010, with a total of 19,654 properties selling across the six-county Southland in August, according to DataQuick of San Diego. The jump in sales was driven partly by a quirk of the calendar that left August with more business days than usual.
The region’s median home sale price fell 1.4% from July and 3.1% from August 2010 to hit $279,000, to some extent reflecting a larger share of foreclosed properties changing hands.
“Scratch beneath the surface and there’s not a lot to cheer about this month. Home sales were up from a year earlier but remained far below average,” DataQuick President John Walsh said in a statement. “Many would-be buyers can’t find financing, and others who want to make a move now are stuck because they owe more than their homes are worth.”
Together the two reports sketch a portrait of depression in housing, which continues to weigh heavily on the nation’s economy.
A large chunk of the California’s foreclosure increase came because of Bank of America, RealtyTrac said. Bank of America is the nation’s largest mortgage servicer, and other big banks often follow suit, analysts said.
“Nobody really wants to be a leader in foreclosed properties but, for better or worse, that is what Bank of America is,” said Guy Cecala, publisher of Inside Mortgage Finance Publications.
…
Is the SoCal market actually in a process of recovery, or merely headed further down the tube?
Southern California Home Sales Rise for First Time in 14 Months
Tuesday, September 13, 2011
Sept. 14 (Bloomberg) — Home sales in Southern California rose in August for the first time in more than a year, led by a surge in deals for lower-priced properties, DataQuick said.
A total of 19,654 houses and condominiums sold last month in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties, an increase of 6 percent from a year earlier and 8.6 percent from July, the data company said today in a statement. It was the first year-over-year sales advance since June 2010, with all six counties showing gains.
Sales of homes priced $300,000 and below jumped 10 percent from a year earlier, according to San Diego-based DataQuick. That pushed the median transaction price to $279,000, down 3.1 percent from August 2010 and 1.4 percent from the previous month. Prices have dropped on a yearly basis for six months.
“Home sales were up from a year earlier but remained far below average,” DataQuick President John Walsh said in the statement. “Many would-be buyers can’t find financing, and others who want to make a move now are stuck because they owe more than their homes are worth. Financial markets are increasingly choppy, the political outlook is incredibly murky and consumer confidence remains poor.”
…
How does the prospect of yet another great big fat Greek bailout change the financial outlook here in America?
Stocks Rally as Gold Declines for Third Day
By Stephen Kirkland - Sep 16, 2011 2:44 AM PT
The euro weakened for the first time in three days and U.S. stock futures declined while European shares gained as finance ministers gathered in Poland to tackle the region’s debt crisis. The cost of insuring banks against default fell.
The euro depreciated 0.6 percent to $1.3799 at 10:40 a.m. in London, while the Dollar Index advanced. Futures on the Standard & Poor’s 500 Index dropped 0.5 percent and the Stoxx Europe 600 Index added 0.8 percent. The Markit iTraxx Financial Index of credit-default swaps on the senior debt of 25 banks and insurers slid eight basis points to a two-week low of 253.
Ministers began meeting in Wroclaw, Poland, to discuss ways of shoring up Europe’s most-indebted nations, with U.S. Treasury Secretary Timothy Geithner also in attendance. European Central Bank President Jean-Claude Trichet said yesterday policy makers need to “constantly be ahead of the curve” and show the same unity of purpose as central banks displayed in providing extra dollars to European banks.
“There needs to be more coordinated action and I think markets are taking this very positively,” Kirk Hartman, who oversees $355 billion as the Los Angeles-based chief investment officer of Wells Capital Management, told Susan Li on Bloomberg Television’s “First Up.” “I don’t think we’re going to have a banking crisis, but I think we are going to have more turmoil. Clearly there are issues, but I think over time it will work itself out.”
…
Supermarket shock: Weak dollar, floods, gas send grocery prices soaring
By Susan Salisbury Palm Beach Post Staff Writer
Posted: 8:45 p.m. Thursday, Sept. 15, 2011
Michele Leibowitz, a Palm Beach Gardens mother of four, has no problem summing up what she thinks about rising food prices at the supermarket.
“It’s ridiculous. Earlier this year, I was spending $200 a week on groceries. Now it’s closer to $250,” Leibowitz, a nail technician, said while shopping at Walmart this week.
She singled out milk and cream cheese as items that have gone up the most in price, and she’s right.
Beef, veal, pork, eggs and such dairy products as butter, milk and cheese have seen the biggest increases in the past year, said Richard Volpe, an economist with the U.S. Department of Agriculture.
The price of groceries rose 5.4 percent from July 2010 to this July, according to the USDA’s latest report.
Average price at local stores
Butter
January $2.28 per pound THIS WEEK $3.51
Ground chuck beef
January $2.78 per pound THIS WEEK $3.45
Milk
January $2.80 a gallon THIS WEEK $3.78
Cheddar cheese
January $4.33 per pound THIS WEEK $5.17
Source: Spot checks for store brands
http://www.palmbeachpost.com/money/supermarket-shock-weak-dollar-floods-gas-send-grocery-1861035.html - -
Butter 53.95%
Ground Chuck 24.10%
Milk 35.00%
Cheddar Cheese 19.49%
Thank goodness it’s only 5.0%.
Those deflationary forces are hard at work.
At least property taxes went up.
Volatile food prices don’t count towards headline (Fed-recognized) inflation.
i know…that’s why i said thank goodness it’s only 5%.
Not to mention that 94% of the food is provided by just x4 MegaCorpInc.’s.
Rampant inflation in what you “must have”…
I’m still unsure that it’s inflation. They are raising prices to what the market will bear, on “needs.” Investors see the steady dividends from customers and blow up the commodity bubble.
Where do people get the money so that they can continue to be customers? They cannibilize from somewhere else, like health insurance, or mortgage payments. Each industry doesn’t care what other need the people cannibilize, as long as it’s somebody else.
Our standard of living is going into the toilet.
I just yesterday bought a couple of cans of freon (r-134A) for my car and the cheap store brand was $17 a can! It has been a couple of years, but the last time I bought the stuff it was about $5 for a can. I asked the clerk what the deal was and he replied: “everything is more now”. The kid understands Bernankenomics.
See the price of auto parts ?? Through the roof…
I thought “printing dollars” was supposed to make the value of gold go up. What has changed that explains why increase in bailout dollars now leads to a drop in the dollar price of gold?
Gold Set for Biggest Weekly Loss in Two Years
By Nicholas Larkin and Phoebe Sedgman - Sep 16, 2011 1:52 AM PT
Gold fell for a third day in London and headed for the biggest weekly loss since May as easing concerns about Europe’s debt crisis cut demand for the metal as a protection of wealth.
European equities were little changed near a one-week high after the European Central Bank said it will coordinate with the Federal Reserve and other central banks to ensure euro-area lenders have enough dollars and Germany and France assured investors that Greece will remain a member of the euro. Gold touched a record $1,921.15 an ounce on Sept. 6.
Policy makers “are looking for a solution and in the short-term the market may react to that,” Afshin Nabavi, a senior vice president at bullion refiner MKS Finance SA in Geneva, said today by phone. “It would be a healthy move for the market if we see a correction. I don’t see miracles happening that quickly” and gold may rebound toward $2,000, he said.
Immediate-delivery gold fell as much as $25.90, or 1.4 percent, to $1,762.68 an ounce and traded at $1,775.07 by 9:24 a.m. in London. Prices are down 4.3 percent this week. Gold for December delivery was 0.2 percent lower at $1,778 on the Comex in New York.
Bullion is in the 11th year of a bull market, the longest winning streak since at least 1920 in London, as investors seek to diversify away from equities and some currencies. The metal is up 25 percent this year, outperforming global stocks, commodities and Treasuries.
…
The herd keeps running from the port railing to the starboard.
A lot of paper gold got sold to cover margin calls and stock losses. The same thing happened in 2008.
But the gold popped up after the issuing of this article. Close: $1812.xx . Not too shabby!
The long-held rule in the marketplace is that an ounce of gold, historically, has been able to buy a decent suit. When gold was $20 or $200 per ounce, you could buy a decent suit for that price. An average new suit will cost you about $450 today. I would have to buy a pretty pimped out Armani for $1800.
Thank you.
“An average new suit will cost you about $450 today. I would have to buy a pretty pimped out Armani for $1800.”
Another sign of a bubble in gold!
Is Bank of America merely going through a brief rough patch or has their foolish agreement to acquire Countrywide sent them into serious long-term decline? And is there any reasonable chance they will soon no longer have any legitimate claim to the name “Bank of America”? (For some reason, the corporate moniker “American Motors” just came to mind.)
By the way, we used to bank with them, before they changed their policies to screw small consumers. Now we bank with JP Morgan, but only because we have had insufficient reason to leave them since Washington Mutual imploded, especially since their ATMs outnumber local Starbucks operations.
BofA Said to Keep Countrywide Bankruptcy as ‘Nuclear Option’ to End Losses
By Hugh Son and Dawn Kopecki - Sep 15, 2011 9:00 PM PT
Bank of America Corp. (BAC), the lender burdened by its Countrywide Financial Corp. takeover, would consider putting the unit into bankruptcy if litigation losses threaten to cripple the parent, said four people with knowledge of the firm’s strategy.
The option of seeking court protection exists because the Charlotte, North Carolina-based bank maintained a separate legal identity for the subprime lender after the 2008 acquisition, said the people, who declined to be identified because the plans are private. A filing isn’t imminent and executives recognize the danger that it could backfire by casting doubt on the financial strength of the largest U.S. bank, the people said.
The threat of a Countrywide bankruptcy is a “nuclear” option that Chief Executive Officer Brian T. Moynihan could use as leverage against plaintiffs seeking refunds on bad mortgages, said analyst Mike Mayo of Credit Agricole Securities USA. Moynihan has booked at least $30 billion of costs for faulty home loans, most sold by Countrywide during the housing boom, and analysts estimate the total could double in coming years.
“If the losses become so great, how can Bank of America at least not discuss internally the relative tradeoff of a Countrywide bankruptcy?” Mayo, who has an “underperform” rating on the bank, said in an interview. “And if you pull out the bazooka, you’d better be prepared to use it.”
…
Sounds like B of A could peel off Countrywide and stop losses there. Ring fenced. lol. They’ve had plenty of time to loot anything there that was interesting, and to spend whatever the FedGov gave them to adopt the turkey on their own bonuses.
Yep. What is left of the remains of Countrywide must qualify as “lethally toxic mortgage debt.”
Is Bank of America merely going through a brief rough patch or has their foolish agreement to acquire Countrywide sent them into serious long-term decline?
I think that the acquisition of Countrywide will be to BAC what Waterloo was to Napoleon.
Now that the discussion of Social Security (aka “The Third Rail of Politics”) has been breached, how are the presidential candidates going to deal with it?
Poll: Perry ‘Ponzi’ Remark Carries Political Risk
By Lisa Lerer - Sep 15, 2011 9:00 PM PT
To get a sense of the political risk Republican presidential candidate Rick Perry faces by calling Social Security a “Ponzi scheme,” meet Flo McDonald.
“They should shoot him for what he said about Social Security,” said the 82-year-old, sitting by the pool at Kings Point, a retirement community outside of Tampa, Florida.
Perry’s remarks about Social Security have exposed a generational divide among Americans. Sixty-two percent of adults aged 55 and older disagree with Perry’s characterization of the program, while 55 percent of those 35 years of age and younger agree with it, according to a Bloomberg National Poll conducted Sept. 9-12.
Those dynamics set the stage for primary contests in such early voting states as Florida and Iowa that have a high percentage of seniors who are reliable voters. In 2008, 44 percent of Republican primary voters in Florida were 50 years old or older; in Iowa, seniors represented 27 percent of the primary turnout.
“We have very clear age schisms,” said Susan MacManus, a political science professor at the University of South Florida. “That makes it a tricky issue here.”
…
“makes it a tricky issue”
Not so much. A diversion maybe. We’ve probably shoved enough $$ up the EuroBank’s behind to put every one in the USA on Social Security.
Its worse than a ponzi scheme because you have no choice whether to
participate.
OK. Let’s say there’s an opt-out. What would you do with the extra cash, unc? Conservatives love to say “Give me a chance’ I think I could do better than the gummit,” but when you ask them exactly how, they go vague again, muttering something about “working hard” or “I’m smarter” or “Kenyan Muslim” or the usual non-specifics. So how do you plan to save up for at least 10-15 years past age 65 or so?
Will you open your own business? Remember, nobody has the money to be your customer. Can’t cut taxes if you have no profit to tax in the first place.
Will you play the stock market? Remember, Goldman Sachs has the discount window for instant free money, the computers to make microsecond trades, and lapdog politicans up the wazoo. You have none of those.
Live off your 401K? Possible. Make sure you pay off your house NOW, so you can sell out and live very cheap later on.
Will you “work until you die?” Right. You’re more likely to be laid off when you’re 60 because you’re skewing the health insurance risk pool too high, or because some young gun in India took your job.
Live off a lavish pension brought to you by a union goon? More likely you’d die of shame first.
“Keep fighting” and work minimum wage until you die? Maybe. Wal-mart likes old people because their health care is mostly paid for by that same gubmint you hate.
Live cheap in the sticks and farm your way through life? Possibly, that’s how our ancestors did it. And it sucked.
If I blew it in vegas, at least I’d get my hands on it for a bit. As it stands, I’m just being robbed based on the lie that I will get it back, and threat of prison if I don’t pay it.
A nice summary.
How many of those that want to quit paying for Social Security, and invest it themselves, end up sinking all their retirement money in emu farms, or the functional equivalents?
Then you are back to Square 1. Broke old people, living in a cardboard refrigerator box, eating cat food.
Of course we know what the solution is. Local housing inspectors for the cardboard boxes, and cat food certified/approved for human consumption. At least until the cat food gets too expensive.
GS-fixer, I’m afraid those guys won’t even have the option to ply their talent and acumen down at the emu farm.
If my landlord got a whiff that people were opting out of SS, and had a few extra thou in their pockets, the LL would immediately raise the rent. If you try to tell them that “no, we can’t pay that rent, we’re saving our SS cash for retirement,” the LL would invite you live somewhere else. And someone else who IS willing to give up that cash to pay the rent, will move in.
Multiply this by every landlord, college, grocery store, phone company, gas station, hardware store. Result: that money that you were supposed to be saving, is GONE, and you will never get it back. You never had a chance to save it, no matter how strong your willpower.
And then, you’re right, it’s back to cardboard boxes and cat food. If you’re lucky, your kid will make more than $500 a week and you can sit in Grandpa’s chair in the corner of the living room amd drool for a few years until you keel over.
I’m going for the traditional “Stick the old guys on an iceburg, and tow them out to sea” plan, myself.
I’m just pizzed I past up drinking, drugs, unprotected sex, naked skydiving, etc. What’s the point of living until 80, if it means that your eating cat food under a bridge?
If present trends continue, expect to see the much bragged about “life expectancy” of US citizens to drop dramatically in the next 10-20 years.
IOW, we’ll be Russia, with expensive vodka.
If present trends continue, expect to see the much bragged about “life expectancy” of US citizens to drop dramatically in the next 10-20 years.
I’d actually be ok with that to a degree. I always “joke” (notsomuch) that 80 is my upper limit. Don’t think I really care if I go past that. Quality of life and all.
Of course now that my parents are 10 years away from my upper limit, it makes me rethink. But you can keep 100. I do not feel the need to be on Willard Scott’s Smuckers jar.
You live within your means, just like the government and
everyone should be doing right now. As for the extra “cash”,
it’s not the governments money to begin with, even though
the left thinks it all belongs to them.
You live within your means, just like the government and
everyone [+Goldenman$ucksInc.] should be doing right now
Again, unc, if you’re 65 and no longer have a job, do you really think that you’ll be able to save away 10-15 years of living expenses without going broke?
As an example, I had a relatively high-paying job, scrimped and saved, got out of debt, and put away cash like nothing else. I was laid off. I had TWO years of living expenses. And that’s with no health problems.
YOu don’t have a chance.
Its worse than a ponzi scheme because you have no choice whether to participate ??
Not So….Many government employees are exempt from participating including all of D/C I believe…
Nope. That was changed in the early 80’s(?). Fed employees now pay SS, pay into a small pension,* and opt-in to TSP which is a 401K with 5% match.
And those in the old system who were “opted out” of SS long ago didn’t get the cash. The cash was put into a pension system, so they didn’t have a choice to not participate either. And there are so few of them left (25+ years) that it doesn’t really matter.
—————–
*generally 1% of top 3 for each year of service. So if you work there 30 years and reach $100K, your pension is a lavish $30K.
Wasn’t aware of that oxide…Thanks
A few additions. The people on the old system could get SS if they had 40 quarters of work outside of the government when they did pay into SS - just like anyone else. But usually the government service was second so the amounts were tiny. They got no SS “credit” for the times they didn’t pay in.
The old system was 2% of average of high 3 for each year of service, so in Oxide’s example the person would get $60K per year. They also are allowed to participate in the 401(k) but get no match of any kind.
And the only salary that counts toward the pension (for old and new system) is base pay and locality adjustment. No bonuses are counted. No overtime. Nothing else. No matter what. Old system tops out at 80% even if you have more than 40 years of service. New system tops out at 40% even if you have more than 40 years of service.
“Its worse than a ponzi scheme because you have no choice whether to participate.”
It is a mandatory insurance program, much like car insurance. If you don’t want to pay car insurance, you can choose not to own a car. If you don’t want to pay SS, you can choose not to work or you can choose to work under the table. IMHO, neither are good options, but that doesn’t mean there are no options. Do you resent paying for health insurance or does your employer pay it so you don’t see its cost to you?
Like most insurance, there is a significant chance that you will pay in more than you collect. There is also a chance that you will collect more than you pay in.
If the pay-in is set correctly, then the payouts will be less than or equal to the pay-ins. The pay-in/payout is always a guessing game, because the future is uncertain and uncertainty increases the farther out you look.
Adjustments to pay-in and/or payout are required from time to time. The adjustments that Reagan made in the 80s were sufficient to carry us until today. It is time to make adjustments again. If those adjustments exempt significant numbers of boomers - those over 55 as the Republicans have proposed - then we are not solving its biggest problem, which is demographic.
i must be the only person on the planet that would be ok with:
raising the age
decreasing benefits for the rich
eliminating beneftis for the super rich
giving individuals a little control
but then again…i’m a saver.
Michael:
I think most people would agree with you the rich dont “need” SS to live on.
And yes raising the age is manditory…but lets phrase it so people can understand why:
Do to so many of you who quit smoking, life expectacy has increased so much, that you would be drawing far more checks then we anticipated.
Attention old people: Your government demands that you smoke, drive drunk, have unsafe sex, and try as many illegal drugs (you are already taking as many legal drugs so not much we can do there) as you can manage. If you don’t meet your government’s thresholds for dangerous activity, then you will be fined.
I would be in favor of means-testing (decrease benefits for the rich) for SS.
I am not in favor of lowering contributions to SS; ie cutting payroll tax. If people have extra cash in their pockets, then ALL the landlords will raise the rent to eat that extra cash and you’re stuck.
I don’t want to “give individuals control” because that’s a foot in the door to eliminating SS entirely. The cash that used to be your SS retirement will be eaten as plain old tax, will be eaten up by Wall Street fees, or will be eaten by landlords and grocery stores.
I am NOT in favor of raising the age. There are too many late baby boomers out of work who will need that SS as their only source of income.
What we REALLY need — really, is some form of universal health care, or at least earlier Medicare. I think there are a lot of people who could afford to either quit or work part-time but can’t because of the health insurance debacle. Let them retire and let the younger generations work those jobs.
“I am NOT in favor of raising the age.”
i would suggest a gradual raise…not suggesting raising it to 70 all of a sudden like.
We already have a gradual rise. I don’t get “full benefits” until 67. They do need to take a look at the actuarial stuff they did on the reduced benefits as early as 62. Is there any effect on the overall health of the system with a lot of older unemployed people taking that option that in normal times would have waited to retirement age? Given current health care advancements/health care issues are the morbidity predictions still accurate?
I get full benefits at age 66 and a half, and guess what? I’m gonna go right ahead and claim ‘em, that’s what.
“If people have extra cash in their pockets, then ALL the landlords will raise the rent to eat that extra cash and you’re stuck.”
You progressives just have it all figured out. Very scary.
decreasing benefits for the rich ??
Please, if you will, “define” rich….
Perhaps as progressive tax on income over the age of 67? If you’re rich enough, your SS benefits are taxed away to where you effectively don’t get them. The dollar value of where this starts will be the rub.
Sounds like a good way for the government to keep people down. Let’s say I contribute to a fixed annuity and it ends up paying me 6k per month, and all these years I have contributed to SS and should get another 3k+ per month, now the government says eff you…you get nothing because you saved.
You are darn right that the dollar value of where this starts will be the rub.
The Establishment GOP’s Wall Street wire-pullers are salivating at the chance to engage in a final orgy of looting against “privatized” social security funds. Rick Perry is their boy all the way.
‘Ponzi scheme’ comments could cost Perry independents
September 16, 2011, 11:24 AM
Texas Gov. Rick Perry’s controversial comments about Social Security could cost him support from independents if he ultimately wins the Republican presidential nomination, but they won’t put off many in his own party, a new poll suggests.
Forty percent of independents told a USA Today/Gallup poll that they think Perry’s remarks including labeling the entitlement program a “Ponzi scheme” will hurt his electability. Only 11% said it would help.
The outspoken Texas governor hasn’t backed off from his claims that Social Security is “broken” and a “criminal enterprise.” In an interview with Time magazine this week, Perry said those on Social Security today and those soon to be getting benefits should get them. But he said young Americans know that “the program that is there today is not going to be there for them unless there are changes made.”
Perry’s main challenger Mitt Romney has seized on the governor’s comments and shows no sign of letting the issue go.
…
How many of those independents live in Florida and Arizona?
I’m an Independent who lives in Arizona. And I do not approve of Mr. Perry’s “Ponzi” message.
Oh, BTW, the voter registrations for this state are about even-Steven among Republicans, Democrats, and Independents. And, of the three, we Indies are the fastest growing group.
heheeeheeeheehaahaaahaaheeehaahaaa… (Hwy50™)
Social Security
A monstrous truth
If Mr Perry were in fact calling for limited changes to ensure Social Security can meet promised benefits past 2036, that would be fine. I disagree that this is what he’s doing. You don’t call something a “monstrous lie” when you want to tinker with it. What Mr Perry is doing is part of a consistent decades-long habit across much of the conservative right of attacking the foundations of Social Security.
The Economist online
Sept 9th 2011, 18:22 by M.S.
This should provide us with a hint as to why, as Kevin Drum writes (rebutting Shikha Dalmia), Social Security is not a Ponzi scheme. The entire population of working Americans has already been subscribed to Social Security for decades, yet the system continues to pay out benefits on time. That is because the actuarial calculations underlying its revenues and benefits are sound. Rick Perry may consider Social Security “a monstrous lie”, but my parents and one surviving grandparent keep getting checks in the mail, year after year. Social Security does face a shortfall in the coming decades, because of the population bulge of retiring baby boomers. Those costs are limited and, measured as a percentage of GDP, will flatten out. They can be absorbed through a modest, gradual increase in Social Security taxes and modest reductions in benefits for wealthier recipients. As my colleague notes, this is what a graph of Social Security’s finances looks like:
[View Chart online]
Up until about 2007, the goal of such attacks was clear: conservatives wanted to replace it with a Chilean-style defined-contribution plan that would be invested in securities. Within its own assumptions, that programme did at least make sense; but since the financial crisis, and with average returns from Wall Street now sharply negative over an entire decade, both the logic and the political support for any such programme have evaporated. If Mr Perry is no longer arguing for the dubious concept of turning Social Security over to the states, then it’s not clear what he proposes as an alternative to the current system. The Washington Post’s Jennifer Rubin, generally a reliable voice for mainstream Republican views, has had no luck getting Mr Perry to clarify what he thinks, and warns that he “can’t afford to offer half-baked ideas and allow his past, troublesome statements to float around.”
My grandmother cast her first presidential vote for FDR, in 1936. He had passed the Social Security Act one year earlier. She began receiving Social Security checks in the year Jimmy Carter was elected president. She turns 100 in December, and the checks are still coming in. She has since been joined on the rolls by her two daughters. There is every reason to believe that their children, who have been paying taxes into the Social Security system for decades now, will also enjoy its benefits when they retire. Unless, of course, conservative politicians succeed in convincing working Americans that the whole thing is a “monstrous lie”.
(About Democracy in America
In this blog, our correspondents share their thoughts and opinions on America’s kinetic brand of politics and the policy it produces. The blog is named after the study of American politics and society written by Alexis de Tocqueville, a French political scientist, in the 1830s)
A good Retardican politician never lets the facts stand in the way of his incendiary straw man.
Of course, it is crucial to understand a Retardican’s target audience, which is people who have lots of open space between their ears.
The first rule of the Ponzi scheme is that you don’t talk about the Ponzi scheme.
Charles Ponzi was the man behind the original Ponzi scheme, while Bernard Madoff was the man behind a recent variant.
Who exactly is the Ponzi schemer behind the Social Security system?
You quickly see that calling Social Security a Ponzi scheme is a basic RNC straw man. If anyone has evidence to the contrary, I am interested.
“Who exactly was the Ponzi schemer behind the Social Security
system?”
Roosvelt Soc. Security act of 1935.
Roosevelt is long gone, and the SS system was set up as insurance against old age, surivorship and disability (OASDI = Old Age, Survivors and Disability Insurance) — perfectly reasonable at a time when life expentency and retirement age were well-aligned at 65 years. Nobody could have foreseen the Baby Boom and the increase in life expectancy which have led to systemic imbalances.
So as I said, RNC STRAW MAN…
A large chunk of the difference in life expectancy at the time (as compared to now) was from infant/childhood mortality. People who never reach working age are irrelevant when it comes to a program funded through wages and paid to the elderly.
There is an increase in life expectancy for people at the time they reach the age when payments occur which is a much better way of evaluating it (not at all perfect, since mobidity of working age adults has also changed). There is an issue, but not at all what you would predict if you simply looked at “life expectancy at birth” tables.
Response to “RNC straw man”. Why do the dems refuse to
admit that the system is unsustainable at the current rate?
At least some on the right have the nuts to show and
document that it won’t last in its present state. Also
Roosevelt was the original ponzi boy. Something like 130
workers supported 1 retiree at its inception now its like 3
to 1.
“Why do the dems refuse to admit that the system is unsustainable at the current rate?”
If SS is sustainable at a different rate, then it’s not a ponzi scheme.
“There is an increase in life expectancy for people at the time they reach the age when payments occur which is a much better way of evaluating it (not at all perfect, since mobidity of working age adults has also changed).”
Polly,
I agree with your point, but technically speaking, suggest that the only way life expectancy at birth could increase from 65 to 80ish is for the life expectancy at age 65 to increase considerably.
Substantially, but not as much as you think. Krugman hashed it out a few months ago. I don’t want to go run it down, but if you do some leg work on his blog you can probably find it.
The median age of death for people who reached 65 was in their 70’s. I believe it still is.
“Roosevelt was the original ponzi boy. Something like 130
workers supported 1 retiree at its inception now its like 3
to 1.”
Ponzi was the original ‘ponzi boy.’ He set up a scam where new entrants paid the returns on the original entrant’s investments. I know it sounds a lot like how Social Security turned out, but there was no way to predict at the outset the increase in life expectancy or the post-WWII baby boom which would lead to an explosion in system costs.
However, as anyone who has studied to become an actuary knows, the fatal flaw of the social security system was to set it up as a pay-as-you-go plan. That, coupled with the demographic changes which occurred between 1935-present, explain its ponzi-like behavior as seen through the lens of the rear-view mirror. But this would not have happened if the miracle of modern medicine had not greatly increased post-age-65 survivorship.
“The median age of death for people who reached 65 was in their 70’s. I believe it still is.”
It’s really more complicated than this, as you can start with an infant, consider the probability they will eventually enter the workforce, consider what their likely earnings will be and how much they are promised to be payed out of SS, consider the probability they live to collect it, and how much they will collect, then finally consider how long past 65 (or whenever their benefits will start) they will continue receiving payment out of future worker SS tax payments. The balance between the expected present value of their future earnings versus the expected present value of future social security payments tells you what the liability (or surplus) is.
This doesn’t really sound much like a Ponzi scheme to me, but then I have a fairly decent graduate school education. I can understand how the likes of Rick Perry and his Retardican constituents might find all these details a little too confusing to think about very carefully. It’s so much easier to just package something you don’t really understand at all with a neat convenient label, like “Ponzi Scheme,” “treason,” etc.
Let me see here…I take it you don’t care for Rick Perry or Republicans CIBT, that’s fine, I think Perry is the ultimate opportunist and most R voters will recognize that fact.
Thanks for the expert analysis on SS, no need for any readers of this blog to think about it any longer, you have educated us and we will now all be quiet and let the Progressive left run away with our country.
Thank you.
Let me see here…I take it you don’t care for Rick Perry or Republicans CIBT, that’s fine, I think Perry is the ultimate opportunist and most R voters will recognize that fact.
Thanks for the expert analysis on SS, no need for any readers of this blog to think about it any longer, you have educated us and we will now all be quiet and let the Progressive left run away with our country.
Thank you.
Sorry for the double post, Firefox locked up on me, thought it did not post the first time.
I have a Ponzi Q: In the original Ponzi scheme, did the guys at the top of the pyramid cash out, or keep collecting? Because in the SS scheme, the peope at the top of the pyramid most assuredly cash out. In great numbers.
“Perry’s remarks about Social Security have exposed a generational divide among Americans. Sixty-two percent of adults aged 55 and older disagree with Perry’s characterization of the program, while 55 percent of those 35 years of age and younger agree with it, according to a Bloomberg National Poll conducted Sept. 9-12.”
Excuse me, but doesn’t 62% + 55% = 117% ? What am I missing? Thanks in advance.
“What am I missing?”
62% of “adults aged 55 and older” + 55% of “those 35 years of age and younger” is definitely less than 100% of everybody of all ages under consideration.
Why can’t the Dow Jones Industrial Average ever make up its mind whether it wants to stay above 11,000 or not? Is that some kind of Maginot Line for U.S. share prices?
And how is the Eurozone bailout likely to turn out? Will the bailing agencies have greater success bailing out too-big-to-fail entities in the Eurozone financial landscape than the Fed had with Bear Sterns, Fannie Mae, Freddie Mac, Lehman Brothers, etc etc etc?
Sept. 16, 2011, 6:37 a.m. EDT · CORRECTED
Stock futures point to lower start for Wall Street
Research in Motion drops in premarket trade after earnings
By William L. Watts, MarketWatch
An earlier version of this story gave an incorrect dollar translation for the size of the European Financial Stability Facility. The story has been corrected.
FRANKFURT (MarketWatch) — U.S. stock index futures pointed to a lower start for Wall Street as investors eyed a meeting of euro-zone finance ministers in Poland attended by U.S. Treasury Secretary Timothy Geithner, while shares of Research in Motion were under pressure after a disappointing earnings report.
Futures on the Dow Jones Industrial Average (DJ1Z -0.33%) fell 37 points to 11,338. Standard & Poor’s 500 futures (SP1Z -0.29%) declined 4.6 points to 1,199.60, while Nasdaq 100 futures (ND1Z -0.32%) fell 7.5 points to 2,276.50.
…
Is there really any reason to fear such a widely-anticipated crisis?
Sept. 16, 2011, 12:01 a.m. EDT
Lehman Brothers II crisis is coming soon
Commentary: Canadian strategist says debt will produce ‘ugly’ result
By Howard Gold
NEW YORK (MarketWatch) — Three years ago, the House of Lehman collapsed like a house of cards. And if you thought the original was scary, just wait until Lehman II comes to a theater near you — in IMAX 3D with digital surround sound.
That’s the view of sober-minded Canadian strategist and money manager John Stephenson, senior vice president of First Asset Management in Toronto.
He predicts a new, Lehman-like financial crisis in the next six to 12 months, only this time involving the debt of governments and European banks.
He thinks it could drive stocks much lower, to levels at which they traded, well, just after the collapse of Lehman and AIG in fall 2008.
“When it happens, it’s going to happen fast, and it’s going to be ugly and very deep,” he told me in a telephone interview, adding that he expects it to be “worse than the last crisis. Last time around, the governments had some room to bail people out. They don’t have that capacity [now].”
…
I think the printing press is still plugged in? Not to worry.
“And if you thought the original was scary, just wait until Lehman II comes to a theater near you — in IMAX 3D with digital surround sound.”
with all due respect mr. jornalist…go eff yourself.
Are five central banks better than one when it comes to bailouts?
Central banks boost dollar liquidity
David Wessel and Charles Forelle discuss how five central banks are moving to inject dollars into the European banking system, as fears of a sovereign debt crisis mount.
Is the recent increase in foreclosure activity a good sign or a bad one?
Sept. 15, 2011, 12:01 a.m. EDT
Foreclosure filings jump 7% in August from July
Foreclosures fall over the year, but monthly figures signal trouble ahead
By Andrea Coombes, MarketWatch
NEW YORK (MarketWatch) — The number of default notices mailed to homeowners who were late on their mortgages soared in August to a nine-month high — the largest month-to-month increase in four years — and that helped push the rate of overall foreclosure filings higher last month, according to data released by RealtyTrac Inc. on Thursday.
Foreclosure filings, which include those late-payment notices plus auction announcements and bank repossessions, rose 7% in August compared with July, hitting a total of 228,098 U.S. properties. But the filing rate fell 33% from a year earlier.
And while the number of those first-time default notices sent rose 33% in August versus July, to a total of 78,880 properties, they fell 18% compared with a year ago, and they’re 44% lower than the monthly peak in April 2009.
That is, the year-over-year data looks relatively positive, but the monthly data appears to be cause for worry — or, perhaps, relief, depending on your point of view.
The numbers sound bad, “but it actually is a necessary dose of medicine for the housing market,” said Rick Sharga, senior vice president of RealtyTrac, an online marketplace of foreclosure properties.
“Until they get processed, [those properties] can’t be resold to new home buyers,” he said. “We might be seeing the beginning of a return to more realistic levels of foreclosure activity.”
…
How does a “one in three chance” translate into “likely”?
Economists: Recession Is Likely
Economists see a one in three chance the U.S. will slip into recession over the next twelve months and doubt any steps the Fed might take at its meeting next week can change that.
What are the other options that make up the remaining two-thirds? Depression?
It cannot be expected in order for it to be unexpected when it comes. …Got it?
+1
“U.S. will slip into recession”
Jeebus. WTF d’ya call what we’ve got now?
WTF d’ya call what we’ve got now ??
A stagflation suppression….
The UBS Swiss Bank lost 2 big B’s to this guy from Kenya or someplace in Africa ? Was it perhaps by E-mail like what we get every now and then ? Maybe they deserved that.
http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/8767562/Rogue-trader-Kweku-Adoboli-alerted-bank-himself.html
Mr Adoboli, who last week posted an internet message saying: “I need a miracle”, was held at 3.30am yesterday at UBS’s Finsbury Avenue office in London. The bank contacted City of London Police at 1am when the alleged fraud was uncovered.
The BBC is reporting this morning that UBS only became aware of the unauthorised trading when Mr Adoboli told them, and that the bank’s monitoring systems had not picked up the loss. UBS declined to comment, the BBC said.
Mr Adoboli is being questioned by police again today. He was arrested on suspicion of fraud and abuse of position.
The Ghanaian-born banker, a graduate of Nottingham University, works as a “market maker”, advising clients on the prices at which they should buy and sell shares or other assets.
Exactly how he is alleged to have racked up such huge losses is unclear. The bank’s £1.3 billion loss compares with £827 million lost by Nick Leeson in 1995, which caused the collapse of Barings Bank.
new ghanian twist on the old nigerian scam perhaps?
http://www.guardian.co.uk/business/2011/sep/16/thousands-jobs-ubs-trader-kweku-adoboli
Thousands of jobs to be cut from UBS - now these ex-traders will have to find work in economies gutted by bankster looting and asset-stripping from the productive economy. Some poetic justice here.
What bank would let an employee with two years experience “play” with 2 billion dollars? I track everything for a small business and we spend time on controls such as signatures, approval of all contract, et al. We ask our auditor to provide suggestions every year on improving internal controls.
So what gives here? A bank in France loses 2 billion and a year later a Swiss bank loses 2 billion. It does not make sense to me that they could allow a “new” employee have the authority to make these horrible decisions. And where it the auditor’s report on internal control weakenesses.
He was a “star trader” until he wasn’t.
Here’s a topic directed at the political candidates, economists and media. Now that the US economy is in a double dip recession, poverty is at a new high, unemployment stuck on high, house prices falling, foreclosures rising, banks are weak, and the government housing programs didn’t make a dent in any of this; can we now address the real issue?
It’s the housing bubble, stupid!
This mania distorted the global economy for so long that all sorts of things are out of whack. And IMO, preparing for a post stock/housing bubble economy is the best way forward. These housing tax credits, foreclosure “crisis”, job stimulus programs are doomed to fail because they have been set up to resist the inevitable; that the housing bubble is never coming back. If we want jobs in this country, they aren’t going to come from selling each other houses, borrowing against them and taking vacations.
I am absolutely convinced that you are correct.
Can I still take a vacation?
The paradigm shift from a productive, manufacturing-based economy to Wall Street’s speculative, rigged-casino “new economy” is another major cause of our current troubles.
I have always wanted a reverse tax credit for business:
the more people you hire with health insurance 2nd 3rd shift hoildays and weekends the more your tax break. call it prime time pricing, no credits if all your employees work 9-5
Ya notice most power failures happen at 4pm not 4 am.
The Housing Crime Syndicate is powerful isn’t it?
+1…I agree Ben……
In $ummation:
“A vastly over-$old Debacle…” Ben Jones
Verses
“Put you’re non-reality ATM home-“equity”…to work!” anonymous Financial Innovation Geniu$
Weekend Topic Suggestions
All the green jobs of the $1 Trillion stimulus are going “poof”
How will this affect housing prices? Are these jobs in high concentrations in just a few markets (like Southern CA)?
Did any of this money lower energy usage or lower the amount of imported oil?
What do you tell your grandchildren 40 years from now on why they are still paying off this debt (with interest) to the chinese?
This sort of ties in with my topic; a lot of these “green” jobs were in industries that rely on - housing!
These heavily-subidized “green jobs” and “sustainable energy investments” also delivered a rich stream of kickbacks to the DNC.
Maybe so, but they did not have a monopoly on the skim. This was a global scam.
When I worked in the oil refinery, everything was valued in terms of FOEBs; Fuel Oil Equivalent Barrels. Everything was boiled down to the basis of how much energy you would get if you burned it. Compare that to how much energy you have to input to make it and you have a very practical way to judge options and make investments.
The green energy projects of the last decade were a huge scam with negative ROI. THe winners were the scammers and our real energy resources were wasted. People do so love to be bankrupted while being told they are going to get rich.
Tragic, but not as much so as the housing bubble. When we deplete oil to manufacture solar cells and wind turbines that will never pay back, that stuff is just gone. When we built houses and nail salons with that are not needed, we also wasted huge amounts of energy, but now we have to pay for it with blood, sweat and tears.
THe winners were the scammers and our real energy resources were wasted.
And those that got political kickback (cough - obama and the dems).
Yeah using corn to make ethanol while millions are starving in somalia….makes sense.
+1 +1….lets turn food into fuel even if you subsidize it…Just one more industry (AG.) with their hand out for the government cheese..
Blueskye…… EGG ZACTLY.
Why are we not building, developing and tweaking efficiencies to existing systems. And small nuke of course.
Once again you post and show zero evidence. I have posted a couple of articles showing that new wind projects produce electricity cheaper than coal, when coal prices rise they will produce it much cheaper.
Solar prices are falling rapidly. Payback with incentives is less than 5 years now for a business.
You said
THe winners were the scammers and our real energy resources were wasted
Really so wind projects and energy efficiency programs and solar use has wasted our real energy resources? Once again I want you to show me the negative ROI in terms of energy on or solar projects or efficiency programs. So far you have produced nothing to support what you say.
I’m pretty sure that you have been convinced by voices of authority and are not prepared to analyze this objectively.
The Really Big Clue is that “incentives” are required to get a return on investment. Take a look at what happens to the industry when incentives, like FITs are removed.
I’ll throw an example of how the Big Lie is used in “articles” for anyone to ponder, not because I need to be right, because it is important.
The CEO of a company that manufactures wind turbines makes a press release that his new model compares favorably with the ROI on a Coal fired plant. The only thing you need to know is that the rating on the wind turbine is at its peak efficiency rpm. The rating on the Coal power plant is on it peak design point as well. The coal plant runs 24/7. The wind doesn’t always blow. It rarely blows at the best speed.
There are a lot of other factors to consider, but this one thing is a perfect example of how the Big Lie is used so effectively to convince those who want to believe.
We learned this in the 70s, just can’t remember that far back. Got any turbines of that vintage in your neighborhood?
Cue the dogs.
“…Got any turbines of that vintage in your neighborhood?”
Yep, actually I do. They still pump water for a lot of my neighbors. The newer ones are a lot more efficient now though, and also light their homes, run their appliances, charge their batteries, recharge their vehicles, and…pump their water.
Oh, and did I say charge their batteries? As in, for when the wind isn’t blowing? Combined them with with new solar and hydro-electrical technologies, many of us are self-sufficient and living quite comfortably– and inexpensively after only a few years of amortization. And they don’t spew any crap back into the air to screw with the CO2 levels and increase (boogyman alert: Global climate change.)
As the US continues to subsidize and develop alternative energies and their production, and feedback and improvements improve the design and output, they will become even more so. Political critics to the contrary.
Keep in mind that when “hand-held” electronic calculators first came out in the late sixties, they cost six hundred dollars– in 1968 dollars. Ten years later, they were on keychain giveaways. A 256 byte Sony computer system with AutoCad once cost my architect brother $5,000. And a laser printer, 14K. Now I can buy that printer in CostCo for $179– and the reproductions are just as clean if not a lot more vivid.
It takes awhile to get development scaled up for efficient industrial manufacture, but when it does, the technology takes off. I, for one, am glad to see it finally starting to happen in this country. Europe, Asia, Scandinavian, even Indonesia are so far ahead of us in alternate energy technologies it’s pathetic.
Change in technology/energy delivery systems doesn’t happen overnight, but once it overcomes inertia, it tends to take off like a freight train. Research and development is a legitimate function of our government. Sometimes, it flubs big time. (Eight track tape, anyone? Betamax?) Sometime it changes our world. The internet? Birth control pills? Solid Stage Rocketry?
Knock off the whining. Wouldn’t you prefer to see these mistakes made in the early phases than after they’ve been in use for awhile and fall apart? It’s simply the nature of the R&D, and eventually it will pay off.
Or we could put the money into blowing up wedding parties in Afghanistan and paying off oil sheiks….
I’m holding out for clean generation and better battery technologies. And if we’d put that trillion we squandered n Iraq into finding an ambient temperature super conductor, all this would be moot….
ONce again blue sky you post no links to back up what you say.
09/03/2011
By Staff Writers
The President and CEO of Brazil’s Energy Research Company (EPE), Mauricio Tolmasquim, has announced that for the first time ever in Brazil, wind power prices are less expensive than natural gas prices.
This announcement follows the results of energy auctions held last week by Brazil’s National Electric Power Agency (Aneel). The auctions resulted in contracts for 78 wind power projects capable of generating 1,928 MW, and priced at approximately R$ 99.5/MWh.
This cost per MWh is approximately 19 percent lower than the average price for wind power traded in Brazil last year, demonstrating that wind power is becoming a more competitive and viable option in the Brazilian market.
By comparison, the average price for power generated with natural gas is currently R$ 103/MWh in Brazil. In addition to wind power, Aneel auctions last week featured biomass, hydro-electric, and natural gas, for a total of 92 energy projects with investments amounting to R$ 11.2 billion.
In Brazil the price of wind power is less than natural gas, this has nothing to do with peak power measurments. It has to do with wind power producers selling their power for less than electric power produced with natural gas.
http://www.power-eng.com/news/2011/09/1492091317/wind-power-now-less-expensive-than-natural-gas-in-brazil.html
More good news on the renewable energy front Monday: The cost of onshore wind power has dropped to record lows, and in some regions is competitive with electricity generated by coal-fired plants, according to a survey by Bloomberg New Energy Finance, a market research firm.
“The latest edition of our Wind Turbine Price Index shows wind continuing to become a competitive source of large-scale power,” Michael Liebreich, Bloomberg New Energy Finance’s chief executive, said in a statement.
“For the past few years, wind turbine costs went up due to rising demand around the world and the increasing price of steel,” he added. “Behind the scenes, wind manufacturers were reducing their costs, and now we are seeing just how cheap wind energy can be when overcapacity in the supply chain works its way through to developers.”
Driving the trend are falling prices for wind turbines, which have dropped to their lowest level since 2005, according to Bloomberg New Energy Finance.
Bloomberg said it based its analysis on a review of wind turbine contracts provided by 28 turbine buyers in 28 markets across the world. Those contacts represent nearly 7,000 megawatts’ worth of turbines.
Again this has nothing to do with peak production.
Again costs for wind and solar are falling, the price for coal is expected to rise.
Again I’m still waiting for your evidence of a negative ROI in terms of energy. Still waiting. You can’t produce anything because it doesn’t exist. The ROI in energy terms is positive for wind and solar. Likely superior to the ROI on deep water oil production and tar sands.
http://en.wikipedia.org/wiki/EROEI
Yep wind is superior to oil and gas production accoring to the above.
So once again you are proven wrong
I would have been wrong if I had entered into a conversation on the subject with you. I did give you a fulcrum to launch more of your ridiculous screed, but it is not a conversation. I can’t help you.
Well if the green jobs were putting in energy efficient windows and insulation then that will cut heating costs for those households and will allow them to spend more on other things. Energy use per household has been falling.
http://www.newsvine.com/_news/2011/09/07/7651329-shocker-power-demand-from-us-homes-is-falling
NEW YORK (AP) — American homes are more cluttered than ever with devices, and they all need power: Cellphones and iPads that have to be charged, DVRs that run all hours, TVs that light up in high definition.
But something shocking is happening to demand for electricity in the Age of the Gadget: It’s leveling off.
Over the next decade, experts expect residential power use to fall, reversing an upward trend that has been almost uninterrupted since Thomas Edison invented the modern light bulb.
In part it’s because Edison’s light bulb is being replaced by more efficient types of lighting, and electric devices of all kinds are getting much more efficient. But there are other factors.
New homes are being built to use less juice, and government subsidies for home energy savings programs are helping older homes use less power. In the short term, the tough economy and a weak housing market are prompting people to cut their usage.
So yes we are spending less on energy.
In part it’s because Edison’s light bulb is being replaced by more efficient types of lighting, and electric devices of all kinds are getting much more efficient. But there are other factors.
Around the Arizona Slim Ranch, I noticed an immediate drop in the electric bill after I swapped out the incandescent bulbs for CFLs.
Slim do they make a high temp heavy duty CFL for over the stove? I seen sealed ones for outside use….
I’m just using a plain ole CFL in my stove hood. Been working just fine.
I have CFLs, double-insulated doors and windows, insulation up to R-25 and allow the local electric company to cycle off my central a/c as needed.
Last year there were at least three times when they shut off the a/c and I either suffered or went to the mall. This year? Zip, zero, zilch, nada. (Knock on wood)
I attribute it in part to a slower economy, but to a larger extent to the proliferation of incentive-induced solar installations in the Left Coast OC. No electric bill this year over $100 in any given month.
BTW, they pay me for the privilege to shut me down.
Win-win!
And I only purchase Energy Star appliances.
Me too. And now there are LED’s, expensive but even more efficient.
I agree 100% on Conservation but can’t resist:
It’s because the houses are empty!
Yes nothing to do with technology
Residential power use has fallen even as the number of electronic devices has exploded because the devices themselves have gotten more efficient. In the 1970s, for example, refrigerators used 2,000 kilowatt-hours per year. Today, they use 500.
IPads are everywhere and everyone seems to have a smartphone, but engineers have designed them to sip power because battery life is a major selling point. Also, these devices, as well as ever more powerful laptops, are cutting into the use of less efficient desktop computers.
The first flat screen TVs used twice as much power as their widebodied ancestors, but they have been getting dramatically more efficient in recent years, according to Tom Reddoch, executive director of energy efficiency at EPRI. “The flat panel community heard they were energy hogs and they did something about it,” he says.
Appliances are expected to get even more efficient over the next two decades. An EPRI analysis predicts refrigeration will get 29 percent more efficient, space heating will get 24 percent more efficient and TVs and computers will get 22 percent more efficient. Energy needed for lighting will decline by half.
Or didn’t you read that far in the report.
You are an angry little girl. It was a joke in reference to the housing bubble collapse.
Also, these devices, as well as ever more powerful laptops, are cutting into the use of less efficient desktop computers.
I’m looking at replacing my desktop with a laptop. Will be back atcha with tons of questions on what to buy.
Is the NWO (new world order) now pretty much a fact?
http://www.businessweek.com/ap/financialnews/D9PP3JQO1.htm
As I’ve often said, I’m not the sharpest tool in the shed, but with Turbo Tax Timmay’s dollar diplomacy, illegal immigration rampant and subsidized (not just here, but in other countries as well), the UN having become the body that seems to be the one that “legitimizes” nation states (as in Palestine, and BTW, who made the UN the big mega-mega?) and a whole host of other phenomena, that’s what it looks like to me. Multi-nationals and central banks now appear to be the new “rulers”, so to speak, with sham governments the means of keeping the people in line and paying.
Multi-nationals and central banks now appear to be the new “rulers”, so to speak, with sham governments the means of keeping the people in line and paying.
Don’t forget the role played by the corporate media (owned by six multinationals) in keeping the dumbed-down populace in the dark and in thrall to each new promiser of hope ‘n change. Highly recommend Link TV, and Chris Hedges in particular, to those who choose to think for themselves. And, of course, any and all contributions to bloggers like our own Ben Jones who are bringing real news and real truth wouldn’t go amiss either.
http://www.linktv.org/
Chris Hedges is awesome.
http://www.linktv.org/programs/chris-hedges-calling-all-rebels?hm
Chris Hedges: Calling All Rebels. If you’ve had enough of corporatist propaganda and puff-piece stories masquerading as “news,” this is for you.
TTT says not to talk about Tooth Fairy out loud:
http://www.marketwatch.com/story/avoid-loose-talk-on-euro-breakup-geithner-2011-09-16?dist=beforebell
I clearly remember when his predecessor told everyone to not utter the word ‘bailout.’
“hoc tui splat!” (In Montana™)
I’ve noticed over the last few weeks that more housing sales on Redfin.com carry a pending sale (Monterey, Salinas, PG, etc). Are these true sales or is this a RE gimmick to scare fence setters to jump into the market? Certain neighborhoods have an appeal for some of the locals and pricing has come down, but some of the better houses in these neighborhoods are sitting idle while the poorer quality ones are pending. We are still talking the range of $300K to $500K, built in 1930’s to the 50’s and not updated and need roofing. Perhaps it is the result of the lowering of mortgage rates and/or people tired of low bank CD rates jumping into RE hoping to score big. I’ve noticed a lot of grey haired types looking at housing in Monterey, PG and Carmel with no garage, flights of stairs, and high maintenance. Surely they are not planning to move into these properties!
The other type of property with pending is rural on 1 acre or more in brush/fire potential areas. Water rates are rising, maintenance costs are going to be high and most of the areas are gated with fees. Yet housing at $400K to $500K are listed as pending. These are not houses you could find renters for.
“I’ve noticed over the last few weeks that more housing sales on Redfin.com carry a pending sale …”
Redfin changed their default to “active/under contract/pending”. It use to default to “active” only. They discuss it in their forums, and most people didn’t fall for or appreciate the trick.
One house we looked at our realtor told us had 3 offers already on it although all low.
We went into the house and said to each other later we wouldn’t possibly buy it for anything more than what those numbers reportedly were. Sellers/realtors are still pretty unrealistic at recognizing just how much deterioration they’re insisting their new buyers should just take on while still paying the higher price. That was a few months ago and the house is still sitting despite a few minor reductions.
Yeah I’m see more pendings than usual. I tend not to trust it because these usually disappear for X months and then get relisted as a new listing. Until the Housing Crime Syndicate is dealt a blow, I remain skeptical of any trend.
RAL -Agree 100%.
In respect to SS and REO’s, does anyone here know what the banks are targeting as a recovery rate?
Ben- This might be up your alley.
Recovery rate as in SS sold price vs. loan (or REO extend and pretend) price. I was wondering how low the % is at this time?
My Structured Finance class sparked the question. We just covered this topic.
Mortgage Interest rates are the driver right now…
Which, then, compels the question, what happens when interest rates rise significantly OR tax policy changes in a negative way for Housing OR both..??
We had a house sale here in Tampa! House sold for $100 back to the bank.
Notice that somebody came by and ‘borrowed’ the concrete fountain out front, and liberated some of the plants. So far no squatters.
Now the street has 3 empty foreclosures. Two are finally for sale by their banks (after 10-12 months of just sitting there). No idea when the FS sign will go up on this one.
Ambrose does tend to hyperbole but this headline is still an attention grabber:
China to ‘liquidate’ US Treasuries, not dollars
The debt markets have been warned.
A key rate setter-for China’s central bank let slip – or was it a slip? – that Beijing aims to run down its portfolio of US debt as soon as safely possible.
“The incremental parts of our of our foreign reserve holdings should be invested in physical assets,” said Li Daokui at the World Economic Forum in the very rainy city of Dalian – former Port Arthur from Russian colonial days.
“We would like to buy stakes in Boeing, Intel, and Apple, and maybe we should invest in these types of companies in a proactive way.”
“Once the US Treasury market stabilizes we can liquidate more of our holdings of Treasuries,” he said.
To my knowledge, this is the first time that a top adviser to China’s central bank has uttered the word “liquidate”. Until now the policy has been to diversify slowly by investing the fresh $200bn accumulated each quarter into other currencies and assets – chiefly AAA euro debt from Germany, France and the hard core.
http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100011987/china-to-liquidate-us-treasuries-not-dollars/
as soon as safely possible.
That’s the key line
Interest rates rise here expect a massive collapse in demand for chinese made goods and protectionism.
I will stop breathing air as soon as safely possible.
Proactive = Enough of an investment to get our feet inside the Intellectual Property door.
Like I’ve said, the Chinese would be smart if they were to hire a bunch of laid off engineers and machinists to design and build their next generation products. Offer them relocation to some kind of island paradise like Tahiti, where there are no US export restrictions.
I thought Proactive was zit cream?
Chinese would be smart if they were to hire a bunch of laid off engineers and machinists to design and build their next generation products ??
Why pay for it when you can just steal it….
http://4.bp.blogspot.com/-3Fr6xvleDmg/TkeW4Jf6P4I/AAAAAAAACbY/KJxvAgX2WZw/s1600/Foghorn_Leghorn2.jpg
No worries, eyes emailed Foghorn Leghorn & Dawg, might forward it to Marvin the Martian as well…
China steals “Angry Birds” for theme park
Add Angry Birds to the list of Western products and services that have wound up used without license in China.
A theme park inspired by the popular mobile game opened Sept. 1 in Changsha, a city in China’s Hunan province, where visitors take turns with giant slingshots that shoot the birds at pig balloons
By Charles Cooper / September 16, 2011 / CBS News
“This [Angry Birds attraction] serves as a method for people to purge themselves and to gain happiness,” a park official told the Chinese gaming website
Stealing just gets you what’s currently in the pipeline.
Starting a new project from scratch, 20 plus years after they first started designing (let’s say) the F-22 means you get 2010 technology, and without all the overhead/crap that jacks up the price of the F-22 to $200 million a copy.
For example, building an F-22 like fighter with equal performance, only 50% as stealthy, but only costs $30 mill a copy. Then build 2-3000 of them, and have the ability of overwhelming the F-22 force, in the event of a war.
“Quantity has a quality all it’s own”
Messerschmitt 262, 1944-45 production = 1400 (less than half actually flew in combat)
North American P-51B/C/D/K production, late 1943 to 1945 production = 11,750, or thereabouts
(add to this 6-7000 P-47s and 7000 P-38s…….the P-38s mostly went to the Pacific by this time)
All our military operations are designed around the assumption that the US will always have “air superiority”. Take that away, and things get real complicated in a hurry.
Stealing just gets you what’s currently in the pipeline ??
Hows that ?? Cutting edge information is likely stolen/bought all the time…Don’t we throw people in prison every once in awhile for it…What about all the others that are never caught….
Does it seem to anyone besides me that the HBB has steadfastly remained a beacon of facts in the face of a wall of disinformation for seven years and running?
Where does this propaganda originate, and whose interests does it protect?
Will there be a point in time where the porcine beauticians throw in the towel, or when a preponderance of factual evidence so overwhelms their positions as to shame them into silence?
Will the MSM perspective continue converging to underlying post-Housing Bubble collapse world to the point where there is general agreement between underlying economic reality, the MSM picture, and public perceptions?
Enquiring minds want to know!
I’m reminded of a line from Terminator:
Listen, and understand. That terminator is out there. It can’t be bargained with. It can’t be reasoned with. It doesn’t feel pity, or remorse, or fear. And it absolutely will not stop, ever, until you are dead.
These people won’t stop. Ever. Until they are stopped. Politicians enable their behavior by writing the rules of the game favorable to them. We have the vote. We can stop them. By getting rid of the current crop of politicians.
Regarding the MSM - the MSM makes money off of their advertisers. That is their business model. They will not cross those who allow their business to exist.
Why is the HBB well ahead in identifying what is actually happening? Thoughtful people not in the thrall of the FIRE sector come to discuss and present what they know.
“…or when a preponderance of factual evidence so overwhelms their positions as to shame them into silence?”
Ace in the hole for porcine beauticians: Stoopid is dumb, and proud of it, too!
At what point did Retardicanism become a badge of honor for Americans?
When did this become the bits bucket?
Today. And, yes, there is a Bucket for today. I’m headin’ over there.
Drive carefully.
Sept. 16, 2011, 12:00 a.m. EDT
Did Trump call the peak in gold?
Commentary: The Donald is a contrary indicator
By Brett Arends, MarketWatch
BOSTON (MarketWatch) — Uh-oh. Has Donald Trump just called the top in the gold market?
The Donald has just accepted gold bullion instead of cash. According to my colleague at the Wall Street Journal, Trump accepted $176,000 in bullion as a security deposit on space at 40 Wall Street from Apmex, a precious metals dealer.
Trump used the occasion for some publicity, and a dig at the Obama administration. “It’s a sad day when a large property owner starts accepting gold instead of the dollar,” Trump said in an interview. “The economy is bad, and Obama’s not protecting the dollar at all….If I do this, other people are going to start doing it, and maybe we’ll see some changes.”
Oh, brother.
…
He’d better be very careful not to run afoul of the law…
Shouldn’t the HUGE oversupply of construction workers (legal or otherwise) imply a huge drop in labor costs for new builds?
Here is a proposed topic for discussion this weekend:
How have perceptions changed since the Housing Bubble collapsed?
Examples:
1) Hank Paulson tried to suppress the use of the term ‘bailout‘ back when he was Treasury Secretary. Now the press uses the term freely and often.
2) The suggestion the Fed might use stealth liquidity injections to bail out markets used to be an invitation to ridicule for being a “tinfoil hat wearing conspiracy theorist.” Now the press openly discusses central bank liquidity infusions to buoy share prices and shore up investor confidence.
Other examples?
We saw this week how five leading central banks worked together to keep the Eurozone debt crisis from moving beyond smoldering ashes to raging inferno. But if they could prevent the Eurozone volcano from erupting, why didn’t they similarly stop Wall Street from collapsing back in the Fall of 2008?
How do the gods of central banking decide who gets bailed and who gets thrown under the proverbial bus?
Not to worry:
The Financial Times
September 16, 2011 7:48 pm
Storms still loom on the eurozone horizon
By Richard Milne and David Oakley
Eurozone banks have gained a modicum of respite. The European Central Bank’s message to markets this week through co-ordinated action was clear: no bank should go under because of a lack of
liquidity. It stands ready to offer them unlimited amounts of euros – and now also dollars.
The move has eased the pressure somewhat on banks after some stress indicators earlier in the week were flashing red. But the relief did not last long for many banks – Crédit Agricole ended 11 per cent down on Friday, BNP Paribas 8 per cent lower and UniCredit off 7 per cent.
Indeed, eurozone bank shares remain close to their lows for the decade while the cost of insuring bank debt is near record highs as longer-term worries about the effects of deleveraging and regulation on profitability remain.
Neil Prothero, economist at the Economist Intelligence Unit, says banks’ exposure to the eurozone debt crisis continues to cast a pall over investor sentiment. “You wouldn’t suddenly start thinking European banks are a decent long-term bet based on the central banks’ action. There are a lot of long-term issues that still need to be addressed.”
And many strategists wonder how long this latest easing of the strains in funding markets will last.
Laurence Mutkin, strategist at Morgan Stanley, says: “This particular action is a way of demonstrating that central banks will not allow a severe liquidity problem to develop. The markets were telling us this week that one was close. Does it solve the ultimate problem of sovereign debt and the interconnected problems of the banks? No, but it does show that policymakers are committed and do have the instruments at hand to at least try to tackle the problem.”
…