Bits Bucket for October 4, 2011
Post off-topic ideas, links, and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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55 people in the socal area will be charged with filing false tax returns to get back millions in refunds. Why would somebody pick the IRS as a mark? Did they really think they wouldn’t get caught?
1. No
2. Free money - just sitting there
3. We will just move back to Mexico
We will just move back to Mexico
Sounds like they weren’t quick enough as they got caught and charged.
They are not in jail…
“Why would somebody pick the IRS as a mark?”
“Why would somebody pick the IRS as a mark?”
millions of americans do it every day and get away with it.
OCTOBER 4, 2011.Frontier of Frugality -WSJ
Retailers Face Reality That Many People Can’t Trade Back Up.
Retailers and manufacturers are figuring out how to appeal to the new ‘forever frugal’ consumers—rather than pin too much hope on economic rebound.
Retailers are coming to terms with a new reality: the consumer who traded down during the recession and never came back.
Buffeted by high unemployment, heavy debt loads, falling home values and high food and gas prices, these shoppers have been whipped into a permanent state of consumer caution. They buy only what they need, avoid premium labels, clip coupons and scour sales.
Wal-Mart Stores Inc. Chief Executive Mike Duke told analysts in a recent conference call that paycheck-cycle shopping is more pronounced than ever, with shoppers stocking up shortly after getting paid, then moving to smaller product sizes toward the end of the month when they run short of money.
“Consumers are fragile, fatigued and fed up,” said Chris Christopher, senior economist at IHS. Global Insight, citing wage stagnation, food inflation and high gas prices.
Retailers and manufacturers are figuring out how to appeal to these new “forever frugal” consumers—rather than pin too much hope on economic rebound. Some are waiting longer to pass on higher costs, whether for food or cotton. Coca-Cola Co. and other companies have added new packages at small sizes and lower price tags. Some retailers are holding the line on hiring, even as they head into their busiest season of the year. Many stores are expanding their selection of cheaper private-label products and some are offering credit cards with across-the-board discounts. Layaway has made a comeback.
Heading into the holidays, retailers are in a bind. Many of them placed their orders back in early spring when the stock market was rising and the economy appeared to still be rebounding. But lackluster back-to-school sales signal that the holidays aren’t likely to be free-spending for many shoppers. Now retailers are worried they will have too much merchandise.
Eight of the 16 large retail chains that retail analyst Ed Yruma covers for KeyBanc Capital Markets said their inventories had risen faster than sales when they reported second-quarter profit results in August.
It is an ominous sign indicating that chain stores’ profit margins will be squeezed if they have to resort to bigger than planned discounts to move merchandise.
(psssst … this is what deflation looks like)
I called this one years ago. This is due to the end of the “entry level luxury” segment. It was always destined to end as it was fueled by cheap credit with no foundation on savings or wages.
Retailers and manufacturers are figuring out how to appeal to the new ‘forever frugal’ consumers—rather than pin too much hope on economic rebound.”
fat cows followed by skinny cows
history doesn’t exactly repeat but does rhyme
the trick is knowing how many of each
Well how many years of boom did we have, because we are likely to see as many of bust.
30? That’s some serious cow.
“Consumers are fragile, fatigued and fed up”.
Solution: Get rid of the Federal Reserve, go on the gold standard,
and fire all the liberals and RINOs in Washington.
You really think the government created this mess during one of the most deregulatory periods of U.S. history? And not the decisions of millions of people herded along by business, the financial sector, and the advertizing industry?
Well, at least no one is lynching the Blacks or the Jews, or some other scapegoat group. Although things haven’t gotten really bad yet.
The decisions of millions of people got us the crop of losers we
have in Washington D.C. today.
Like either party offered up anything but losers.
Losers? They’re self-serving thieves, who are all making out like bandits. Wait, not LIKE bandits…
“…U.S. government created this mess…”
Wasn’t Alan Greenspan a leading advocate of deregulation? Or do you number among those who hold that the Fed is not part of the U.S. government?
“’t Alan Greenspan a leading advocate of deregulation? Or do you number among those who hold that the Fed is not part of the U.S. government?”
I number among those. Does anybody here believe otherwise?
during one of the most deregulatory periods of U.S. history?
during one of the most deregulatory periods of U.S. history?
during one of the most deregulatory periods of U.S. history?
CorpInc.’$ alway$ put people before profit$,…because that’s good “Bidne$$”. Moreover, they really care about you & what’$ in your peon wallet. Really, just Google it: George Carlin “they” care about you!”;-)
+1
Not yet?
In So Cal they are blaming everything on the Mexicans (illegals).
Corporations MUST care about profits before people.
Ben…?
“Consumers are fragile, fatigued and fed up.”
Actually, they are broke.
And those who aren’t, while perhaps not resorting to cheap substandard crap, have realized that “aspirational luxury” was nothing but fancy wrapping on goods and services that were no better than could be had for much less. “Luxury” is returning to what it was — a way for the rich to waste money.
If the rich don’t get richer, the poor will never get richer.
Sounds like one of the few job growth strategies I’ve heard given the distribution of income: the rest will have to figure out how to earn a living servicing the rich.
I never got a job from a poor man.
Are you a robot or something?
“I never got a job from a poor man.”
If that’s your goal, then perhaps you are setting your reservation wage too high.
I never got a job from a poor man.
What?,…Larry Flint Industrie$ is hiring?
unc
I am a recovered Republican, now a Realist. I disdain those RNC mantras.Both parties are bad news. Got it.
Do you really think the real rich give a damn about you. Nuff said.
“I never got a job from a poor man.”
Funny, a whole lot of attorneys, bankers, pay-day loan dispensers, pawnshop owners, social workers, clergy, etc. have….
Or maybe you’re just stuck in your excuses?
“Funny, a whole lot of attorneys, bankers, pay-day loan dispensers, pawnshop owners, social workers, clergy, etc. have….”
Spot on! Without plankton, whales would die.
Every employee of Wal-mart got his job from poor man.
Every employee of JCPenney got his job from working class man.
It’s not who gives you the job, it’s the guy who BUYS THE STUFF from the guy who gave you the job who gives you the job.
I once got a job from a fellow who was so poor that he was born at home, way out in the country, and it took two days for the doctor to get there. He and his mom just had to tough it out until the doctor came.
Guy was one of the best bosses I ever had. And trust me, he wasn’t exactly making fat bank at the business he owned.
You can work for poor folks
Payday loans
Bankruptcy attorney
Divorce attorney
Car Mechanic
Sub prime lender
Dollar Store
Pawn Shop
Lots of opportunities in the desperation business…
The populist make everyone equally poor idea has been done over and over and over throughout history. The simple fact is that you are not poor because Bill Gates is rich. If you are poor it is because your job has been sent to a cheaper country where regardless of tax we cannot legally compete given minimum wages and work conditions required.
IMO the answer to this particular issue is to replace income tax which as everyone notes is regressive and unfair with a very high tax on manufactured imported goods.
Your splitting hairs here. You are not identifying the difference
between someone who is self-employed and one who works
for others.
UNC - what did the back of the wood shed look like?
UNC- what did the back of the wood shed look like?
It looks like the new “luxury” condo we’ll all be living in if the
progressives stay in power.
“I disdain those RNC mantras.”
I thought I smelled one of those in that post!
“If the rich don’t get richer, the poor will never get richer.”
WRONG.
It’s a zero sum game and the monopoly board gets folded up when one player wins and the others go bankrupt.
Yep. Gambling on asset price movements is zero-sum. It does not “grow” the economy, doesn’t provide jobs, and set us up for boom/bust cycles that end up causing far more damage than what we’d see if we were to disallow this type of speculation.
have realized that “aspirational luxury” was nothing but fancy ??
Exactly WT….
I suspect that the majority of those who are not broke were the frugal ones that did not get sucked into the madness. They are still frugal.
Will the media stop calling it the ‘paycheck cycle’ please? The jump in sales at the beginning of the month is because that’s when more money gets added to the serfs’ EBT cards.
h8er!
It would be really interesting to see the data here—the absolute dollars of EBT vs cash vs CC vs debit card…
Also could someone tell me which days are the EBT load-up days? I would like to go to the local Wal-Mart at midnight and see this show for myself.
1st of every month.
“Retailers are coming to terms with a new reality: the consumer who traded down during the recession and never came back.”
I have an alternative interpretation that a corporate marketing shill like a journalist would never voice in public, because it goes against the motivations of the entire industry.
Even as a “comfortably well off individual” it took awhile to realize and start acting on the following facts:
1) All consumer products come from China
2) All consumer products come from the same factory in China
3) All consumer products come from the same factory in China and have different brand labels.
4) All consumer products come from the same factory in China and have different brand labels and are sold at different prices in the US and marketing spends billions to convince me to spend more for the same thing.
So, priding myself on not being an idiot, I can buy the same pair of socks at the mall for $50, the clothing department store (Kohls, etc) for $25, a “classy” discounter like Target for $10, or the refuse pit that is Walmart for $5 assuming I can hold my nose long enough… So why not buy my socks at Walmart and spend my remaining $45 to purchase an ounce (or so) of Ag?
In the early 90s I swore off Walmart because they sold trash products from China… Everyone had the experience in that era of clothes that were so poorly sewed that they unraveled after a wash or two, or so poorly dyed (is mordant the correct term?) that they faded after a wash or two. Now the market has sharply contracted such that trash is all that’s available, so why not save cash?
Put in terms joe 6 pack can understand, its like trying to convince people that star trek reruns are much cooler and worth more because they’re on a different cable channel.
made in China
The future belongs to Foxconn City
Hon Hai, actually.
Vince, your story is backed up by reports that mid-level retail (JC Penney, not sure about Kohl’s) is suffering, but high-end luxury is doing well, and low-end Wal-mart is doing well. If this goes on, the only place to buy nylons that I can wear more than twice will be Needless Markup.
We’re losing the middle class in every meaning of the word.
The rich are under attack. Poor dears! By Barbara Ehrenreich
http://www.oregonlive.com/opinion/index.ssf/2011/10/the_rich_are_under_attack_poor.html
Oxide-
When I found L*ggs at the 99C Only store, I stocked up. Wear them once or twice and toss. Many dollar stores carry pantyhose now. (Don’t know what $ stores are in your area, but WM sells multiple packs cheap.) JNY and $1 pantyhose. LOL
WalMart same store sales are down for two years running.
A Dlr Tree store mgr and I were having a chat last night, and he mentioned they are cutting into Wal-Mart’s sales.
Or you can buy them in bulk online and stock up for when they start raising the prices in earnest. (Soon.) Silver prices may rise and fall, but dry feet are forever.
Enjoyed your post, vince.
When I went on my kayaking day trip in Alaska, I was the only person who had bothered to bring extra socks. I was stunned. Who the heck goes on a boat trip (especially the sort that is human powered) without bringing dry socks?
“Who the heck goes on a boat trip without bringing dry socks?”
First timers?
Its like I’ve said before, I hate buying stuff because EVERYTHING is junk. It doesn’t matter how much you pay for it or where you buy it, it’s junk that’s made in China, so you might as well pay the least you can for it.
A mordant is the chemicals that fix a dye to the fiber…
In the 90’s I worked for (one of the last) domestic apparel textile manufacturers. Our domestic plants couldn’t make items in some colors (especially reds) because the dyes/chemicals were illegal here. Not so in Asia… another “advantage” they had besides price.
whyoung
Great info, thanks for sharing. Peter Navarro/Professor Univ. of Irvine, Ca./ Economist, says you can tell the color of textile trends (Pantone) by the color of the rivers in China. He saw stuff first hand that floored him.
I don’t need Pantone to tell me what colors are in seasonally. I like what I like, and keep an open mind.
Or Amazon, no smell, no gas to get there. Students get Prime for free, (2nd day shipping for free). Easy to be a “Student.”
I know for a fact that Amazon sells some things for less then their cost, then ship it for free. I compete with them in some areas.
“Free shipping” took on a whole new meaning when that story came out about the 110°F warehouse in PA. What angered me was that Amazon parked ambulances outside to deal with the heat exhaustion. They knew… they KNEW. And now I know that A/C costs more than paramedics on standby.
All the more reason to shop at locally owned, independently operated bookstores. I’m just a mile and a half away from Antigone Books. And I’m glad!
Few warehouses are air conditioned.
Unfortunately, local, independently operated bookstores don’t sell the kind of stuff that I would like. And if the bookstored special orders, it has to be shipped from another hot warehouse, probably.
AZ Slim–
You might find it interesting to know that Google is allowing you to support Antigone Books via purchase of eBooks through the Antigone Books website…
They do the same thing for Kepler’s (a local bookstore here).
Get your eBooks and support your local bookstore at the same time…Go Google.
There is a whole list here:
http://www.indiebound.org/google-ebooks
“Consumers are fragile, fatigued and fed up,”
That’s all we are to the PTB … consumers. Not people, not individuals. We’re just little units that are supposed to purchase their products and services, nevermind how we’re supoosed to be able to afford it since they are so hell bent at offshoring all our jobs.
But no, they just just chalk it up to “lack of confidence”. If only we were more self confident and willing to take on even more debt everything would be A-OK in their minds.
And certainly not citizens…
“And certainly not citizens”
Yeah that one irks me too. I am more than a consumer.
Regarding same factory, different labels, different price points, our firm had a tenant that imported nice linen outfits. A jacket and long skirt set was $65-$90 retail. I got 10 pieces for $100 as a favor. They put their own label in their stuff when it arrived. This retailer made out on illusion.
“This retailer made out on illusion”
That happens a lot… the cost structures can be pretty interesting… the difference in shipping (boat v air) can be a lot of the price difference. “low” end stuff with longer lead times to allow slower shipping v. “fast and trendy” that must get here faster (by air) is much more significant $-wise than materials and labor for some items.
yes, there will be differences in the quality of the materials/workmanship but sometimes not as big a contributor to the price difference than branding/advertising and so forth.
whyoung -Thank you for the food for thought.
If I just add one more piece of wardrobe, I’ll be at the taxidermist, says my other half.
I thought that was the norm in clothing. I work with a woman who lived and worked in NYC in her younger years. She worked for a seller of sports clothes (don’t know the name sorry - maybe Sport World ?). They would go to check out what the manufacturers had and then select what they wanted to carry in their stores. My friend would then be sent over later by car with a box full of the labels from the company to be sewn into all of the clothes their buyers bought.
“the norm in clothing”
for some retailers of “commodity” items who can’t afford the minimum orders from factories, perhaps.
for the big fashion “brand” names who actually “design” and manufacture something that you find in you local department store, they want/need to differentiate their products to maintain their “brand integrity”, etc.
What a confusing article. It blathers on about a bunch of irrelevant stuff when we all know the real problem is confidence.
A pizza place near me was putting “50% off a large pizza” coupons on the back of my grocery store receipts. We’d buy pizza there about once a week.
Well, they stopped the coupons.
I started going to another pizza place that was doing $5 medium, $7 large recession special. Well, they dropped that, so I went to another place that had $5 medium pizzas.
The first place called me (they have a loyalty program where you earn points toward a free meal) and asked why I stopped coming there. Because the coupons are gone. “But, aren’t we better pizza?” Sure. “Aren’t you willing to pay more for better?” As should be self-evident by the fact I’ve not been there in a year, you are not enough better to justify twice the price.
The second place brought back the cheap pizza, but only on Monday. If it is Monday and I want pizza, I go there. If it isn’t Monday, I go somewhere else.
I’d like to learn how to make my own pizza. Anyone got a recipe?
The secret is the dough. There 50 different kinds of flower, Make sure to use the ones for pizzas. (sorry, I’ve forgotten their names off the top of my head)
Me, I like Bobali’s. It’s DYI pizza parts from the grocery store. You buy the crust and sauce by Bobali. You then buy your own other ingredients. (garlic, pepperoni, peppers, mushrooms, whatever) Follow the baking instructions.
Perfect every time.
Flower??
Flour. My bad.
Epicurious dot com has recipes on everything. Hint: Buy frozen bread dough in the grocery store. Plunk a hunk on a cookie sheet in the morning. By evening it will have defrosted and risen. Roll it out and put your stuff on. Shove in the ov and it’s done.
AZ…. as a conneisseur of NY pizza(the only pizza), Mrs and I have made a hobby out of chasing the elusive NY pizza taste, texture and flavah. It took us 10 years of experimentation and observation to perfect it.
Here’s the deal….
Dough- Save yourself the grief and get dough at your favorite pizza joint, $3. You’ll never make a dough like a good pizza shop can. Someone stated it’s all in the dough and they’re right. Any pan will work but we make our best pizza on a well seasoned clay plate…. Important- *use cornmeal!* before you lay the dough into the pan. It actually pops during cooking and gives the crust a crisper texture and helps to brown. Obviously it must be thin. Don’t use a roller or it will be thick, doughy and won’t come out right. You have to pull the dough. Watch a guy make a pizza if you don’t know what I mean.
Sauce- This is a tough one as it is entirely personal preference but generally, sauce on a NY pizza is a slightly sweetened marinara. That’s it. You don’t add extra stuff. Straight marinara slightly sweetened with maybe a half teaspoon of sugar. It will taste too tart without the tiny bit of sugar.Too much sugar and it will taste like catsup.
Mozzarell- If you can find Grande, use it. Most NY pizza joints use it. Otherwise, get a low skim, low moisture cheese. About 8 oz for a full sized pie. Too much and you’ll ruin it.
Romano- This cheese is important. It’s a full flavor dry cheese that’s simply used for flavor in this case. Too much and it will overpower. Grind it fine and spread sparingly after the sauce but before the mozzarell. Once you develop a taste for romano, you’ll be mixing it in your coffee. j/k. Locatelli is a good romano. Avoid that sawdust $hit in a shaker can at all costs!!!
That’s it.. no more ingredients. Why everyone loads pizza with junk I don’t know but stuff like oregano doesn’t belong on pizza. You want the oven burners on full bore, bottom burner only. Get the pizza no more than say 4 in. away from burner. The trick is to get the dough to rise and then to brown. Keep oven door open an inch or so or the ambient temp will brown the cheese and it will taste burnt. Baking should take no more than say 15 minutes max. Every 3 minutes or so, brush the crust with olive oil and shake on garlic salt. Monitor bottom of crust with flashlight. Pull it out once it turns begins to turn golden brown.
Voila…. NY pizza. Takes time and practice but it’s alot of fun getting there if you like to make good food. Once you master it, it will take longer to cool off than it will to put it together.
RAL, this is just WONDERFUL!
Thank you so much for sharing this recipe. I thought I had pizza-making down, but you’ve explained exactly why it never quite worked for me. This one is going into my permanent file.
YUM.
You’re welcome. Let me know of your trials with it. Like I say, it’s the journey.
Well, I wish consumers would get at least a little frugal with housing. They crow about small items, but are still lining up to overpay for the most expensive item they will ever purchase. We’re still way off from the three times income maximum house price rule in the Chicago area.
They crow about small items, but are still lining up to overpay for the most expensive item they will ever purchase.
Because housing (almost) always goes up. Until that belief dies…
FED Up
I’m under the impression by the time housing gets to 3Xincome, I’ll be dead. A home worth $276K (2002) is going for $425K (2011) gutted and all gussied up. The expensive stuff be damn (left as is), it has granite after all. It’s frustrating as hell in So Ca as welll.
Question Awaiting…3x median income=median home price?
Or 3x the median income of the top 50% of earners=median home price (i.e. the 75th percentile of earners)?
Remember, only 60% of the population are owners, and probably 10 of the 60 points aren’t working population (retired like my folks).
Realtors Are Liars®
Stagflationary depressions and Realtors are a bad combo.
Spaniards pay price as cash flow dries up
By Victor Mallet in Parla, Spain October 3, 2011 - FT.COM
For seven years, Jeremiah Ekenobaye made a good living in Spain. Now 38, the Nigerian immigrant says he worked as a van driver, obtained his residency permit, and even bought a flat in the fast-growing Madrid suburb of Parla.
Now, on a weekday morning, he is standing on a street corner looking for work. He depends on government handouts of €530 ($702) a month – less than half the amount he needs just to pay his mortgage – and is convinced that the bank is about to repossess the flat where he lives with his wife and three children.
“I am legalised here, but for more than five years I’ve not been working,” says Mr Ekenobaye. “We are trying to do whatever we can.”
Mr Ekenobaye’s fate is shared by tens of thousands of immigrants and native Spaniards who live in the belt of depressed dormitory towns and industrial suburbs south of Madrid.
More than three years into Europe’s financial and economic crisis, the town of Parla, like Mr Ekenobaye himself, has run out of cash and credit. “In the past four years we have lost 25 per cent of our income,” says José María Fraile, the town’s mayor. “At the moment there’s no liquidity … The [credit] window has closed.”
Mr Fraile is negotiating with trade unions to fire 190 people, a quarter of the city’s workforce, as a way to save money. One private company responsible for sports facilities has obtained a court order to sequester municipal assets to cover millions of euros of unpaid debts. Valoriza, another company, is owed €80m for years of garbage collection and cleaning.
Parla, with a population of some 130,000, is far from the only Spanish town with financial problems. Spanish banks, which freely financed property developers and municipal governments during the housing and infrastructure investment mania that gripped the country before 2007, are turning off the taps. The central government and the autonomous regions are desperate to curb the public sector deficit to avert the risk of defaults.
Meanwhile, town hall budgets have been squeezed by the collapse of income from taxes on property and construction permits, leaving some of Spain’s 8,000 municipalities unable to pay their workers’ wages on time or meet their electricity bills.
Parla’s public finances are in a particular mess. “If the municipality was a company, it would be in liquidation,” says Miguel Angel López, a city councillor and local leader of the rightwing opposition Popular party.
“For seven years, Jeremiah Ekenobaye made a good living in Spain. Now 38, the Nigerian immigrant says he worked as a van driver, obtained his residency permit, and even bought a flat in the fast-growing Madrid suburb of Parla. ”
Wow, even the Nigerians got scammed by the housing bubble.
+1
Awesome!
(pssssst … this also is what deflation looks like.)
Deflation is not a bad thing, unless you are in debt.
Or can’t get a job.
or need to buy stuff, like food.
or need to buy stuff, like food.
that’s only true if it’s not really deflation. Which is a nice counter argument to combo’s position here.
(of course it depends if you think of inflation/deflation as a monetary event vs simply increase or decrease in prices)
It is an irony. Not all things are in sync, and food will go down following oil price. The price of a burger is really dwarfed by large things that are in freefall, like incomes, houses, pensions and now governments. It is deflation and I have been saying that since 2007 or so. We just can’t see it all and we can’t all see it period.
……and when you don’t have a job or a pension or an entitlement, it is really hard to buy a burger, even if it is priced less than when you did have that income.
That is deflation.
Interesting? He made a good living for 7 yrs. and hasn’t been working for 5 yrs. His mortgage is twice $702 or $1404/month. For that rent you can live in a lot of places here in the US.
Sounds like the Fed’s ‘Operation Twist’ failed to convince many economists it will do much of use…
Fed’s ‘Operation Twist’ Fails to Convince Investors It Will Boost Growth
By Joshua Zumbrun and Scott Lanman - Sep 22, 2011 9:00 PM PT
…
Yields Decline
Yields on 30-year Treasuries declined to 2.8 percent yesterday in New York from 3.2 percent on Sept. 20. Stocks tumbled, with the Standard & Poor’s 500 index falling 3.2 percent in New York to 1,129.56, following a 2.9 percent drop the day before. The Dow lost 3.5 percent to 10,733.83.
The Fed should instead put more pressure on fiscal authorities to revive growth and outline a clear policy strategy, including setting a target for inflation, said Greg Hess, a former Fed researcher.
“The Fed needs to be answering questions, or providing confidence out there that answers questions, not just creating new ones,” said Hess, a professor and faculty dean at Claremont McKenna College in Claremont, California. “That’s why I think the response is negative and that’s why you’re seeing volatility rise.”
Stock Volatility
The Chicago Board Options Exchange Volatility Index, a benchmark measure of stock volatility known as the VIX, jumped 10.8 percent to 41.35 in New York yesterday, bringing its four- day increase to 33 percent.
“The downside risks stem from situations such as Europe, the tax law and so forth,” said former St. Louis Fed President William Poole. “The Fed can’t offset those. It is not within the realm of monetary policy.”
Bernanke should instead devote an entire speech to other issues that are holding back the recovery, such as tax policy and regulations, and make clear that the Fed is powerless to deal with them, Poole said.
“For the Fed to be doing these things that are extremely unlikely to have much current impact, it damages the Fed’s credibility,” Poole, a senior fellow with the Cato Institute in Washington, said in a telephone interview.
Economists in a Bloomberg News survey before the Fed’s meeting had low expectations for the action dubbed Operation Twist, with 61 percent saying the move would probably fail to reduce the 9.1 percent unemployment rate. Among those, 15 percent predicted it would be “somewhat harmful.” None of the 42 economists in the survey said the move would be “very effective.”
…
seems like the fed wants to lock in those low rates for the taxpayers…
is locking in a couple of trillion in at 2.8% a bad thing?
No, not if you’re committed to amortizing the debt.
If your plan is to keep rolling the debt over by refinancing when it matures then it can be painful when rates begin to go up.
then it can be painful when rates begin to go up ??
And make no mistake, they will…
But I thought the Fed was committed to sitting on rates for an extended (indefinite?) period of time?
“…Fed was committed to sitting on rates…”
If you want to know what market rates should be, just wait until Warren Buffet makes his next big loan to a troubled company.
BB said that Twist will help by .20 basis points - or nine billion dollars - to the economy.
Proverbial drop in a bucket !
An extra 30 bucks for every man woman and child. Before taxes.
Time to go on an orgy of shopping at the Dollar Store, or the flea market
WHOOT!
Fed Dissenter Thomas Hoenig Retires
by Frank Morris
September 28, 2011 from KCUR
Thomas Hoenig, the president of the Federal Reserve Bank of Kansas City, retires this week. He sticks out among members of the Open Markets Committee. He’s voted against low interest rate policy years, and he’s spoken against it, though in a decorous way. With just a couple of days left on the job, he’s speaking more forcefully now.
…
MORRIS: Candor is fairly standard for Hoenig. A couple of years ago, he wrote a paper called “Too Big Has Failed,” a critique of propping up big banks. He’s also bucked the Fed’s easy money, low interest rate policy for years. He says keeping interest rates artificially low has actually enabled the real problem.
THOMAS HOENIG: In a world of instant gratification, we have had two decades in this country of consuming more than we produce by a considerable margin.
MORRIS: No country can do that forever, he says. Even though the Fed keeps trying to goose the economy with cheap money, the economy can no longer jump.
HOENIG: So that’s why I have systematically opposed the use of money as a mechanism to solve all of our problems. You cannot tell me a business, a commodity, a service that trades well at the price of zero and allocates resources as well at the price of zero. Why would it do so with interest rates? It won’t.
MORRIS: Meantime, he says Washington has become addicted to low interest rates, which Hoenig says has given lawmakers cover to paper over serious long term problems with short term fixes.
HOENIG: People say, and I understand it completely, we need to add jobs. We need to add jobs, but the problem is you don’t just add jobs. You produce things, you make things and from that, jobs come.
MORRIS: Hoenig says leaders need an attitude adjustment to think long-term, to get serious about, among other things, the deficit. He thinks they should pass a broad package of spending cuts and tax hikes like the ones the Simpson-Bowles Commission outlined last year.
Now, Hoenig’s ideas haven’t always gone over that well in Washington, but in Kansas City, the business class sent him out with a long, standing ovation.
(SOUNDBITE OF APPLAUSE)
…
What Weber and Stark were to the ECB Hoenig was to the FED. The lone voice of reasoning in the storm. Now, with the last obstacles removed, charlatans like Bernanke, Geithner or their european counterparts like Trichet and Rehn have free reign. Their policies got us right to the edge of the cliff and I know they will take us one step further.
The rescue du jour in EURO-land is Dexia, a large Belgian/French bank….how ’bout them banks stocks? BAC is down 58% for the year. Buffet counted on the taxpayer to bail out his investment yet again. I wouldn’t be too sure.
“Buffet counted on the taxpayer to bail out his investment yet again. I wouldn’t be too sure.”
It’s still early in the panic. You may think otherwise when you see the dumbfounded looks on Congressfolks’ faces a few months from now…
It’s not the 2008 Congress anymore. Remember the fight over the debt ceiling 6 weeks ago? You think these folks just hand over a cool trillion to Wall Street 3 years after the last disaster? I mean anything is possible but I don’t think so. They’ll tell Wall Street to drop dead, like they should have 3 years ago.
“You think these folks just hand over a cool trillion to Wall Street 3 years after the last disaster?”
No—instead they’ll take the politically easier approach, and just let the Federal Reserve continue to hand trillions to Wall Street.
That way Congress doesn’t take the heat. But the end result is the same.
I caught Buffet last evening on a financial interview where he praised Geithner as the best man chosen for the job and how he would have picked him to run a company for him! The man has no idea what is happening around him.
Warren Buffet-I once feel for his folksy act, but now have not one iota of respect for him.
“fell” not “feel”
I’ll give Buffet credit, he built quite an empire. And he didn’t do it by flipping stuff or skimming or the like. He invested. But he’s out of touch now at best, or decided to join the “you have to lie to maintain the illusion” crowd at worst.
Al-
I agree about Buffet building quite an empire, but the man lost his integrity, imho. I use to think he was a bright “mensch”, but not so anymore.
I though Buffet just invested in B of A who is looking at dropping below $5 a share soon.
Nice post Pbear…Thanks…
Geithner Predicts Europe Will Follow Lessons of U.S. Crisis
By Ian Katz and Julianna Goldman - Sep 19, 2011 3:49 PM PT
Enlarge image Geithner Predicts Europe Will Follow ‘Lessons’ of U.S.
Treasury Secretary Tim Geithner arrives for a meeting of the G7 Finance ministers and ‘Deauville Partnership’ in Marseille, southern France, on Septembre 10, 2011.
Photographer: Gerard Julien/AFP/Getty Images
U.S. Treasury Secretary Timothy F. Geithner predicted that Europe will adopt some of the same measures the U.S. took to battle the financial crisis that started in 2008.
“I think you’re going to see them draw on the lessons of our crisis, draw on the lessons of things that worked here in the United States,” Geithner said in a Bloomberg Television interview today in Washington. “I think you’ll see that reflected in some of the choices they make.”
In the aftermath of the September 2008 bankruptcy of Lehman Brothers Holdings Inc., the U.S. adopted the $700 billion Troubled Asset Relief Program and the Federal Reserve conducted stress tests of the 19 largest financial institutions to ensure their capital was adequate to withstand a more severe economic downturn. The Fed also set up the Term Asset-Backed Securities Loan Facility, or TALF, to keep consumer credit flowing.
Geithner visited Poland last week to meet with European officials, who rebuffed his suggestions for fixing their debt crisis. The Treasury secretary urged European leaders to set aside their differences to excise “catastrophic risks” from the markets.
“The Europeans are under a lot of pressure still,” Geithner said today. “They’re going through a really tremendously difficult job of trying to build a stronger union, stronger economic union with a very strong financial firewall to help those countries that are undertaking reforms.”
Europeans “have a lot of work to do,” Geithner said. “They recognize that more than anybody.”
…
Maybe the Europeans realize that Geithner is more of a dangerous idiot than anybody. Lessons from the US: A few trillions more in debt doesn’t solve anything.
German media mock U.S. advice on debt crisis
September 28, 2011 | 3:54 pm
…
Over the weekend, Treasury Secretary Timothy F. Geithner called on policymakers to “create a firewall against further contagion,” and supposedly has urged the European Union to commit trillions more euros to its bailout fund for member states and their banks — an idea that German Finance Minister Wolfgang Schaeuble called “stupid.”
Spiegel Online on Wednesday published a collection of German media commentaries firing back at the U.S. Most biting was this one from the financial daily Handelsblatt:
…
The Handelsblatt always has interesting commentary. They are the only ones that are not total cheerleaders of more bailouts, like most of the German media including Der Spiegel.
Do they have an English version of their website, or did the LA Times translate one of their articles?
So the Euro PTB are fixin to snub Timmy Boy and tell the PIIGS to drop dead? Unlike Iceland, those countries are a little to big to absorb the losses.
Too big too fail and too big too bail, something gotta give…
Tim Geithner is symbolic of all that is wrong with the current system. The man is an embarrassment to the taxpayer.
I’m reading Ron Suskind’s latest book, Confidence Men. It’s a real barn-burner, BTW.
Any-hoo, there was a passage describing an encounter between Sen. Byron Dorgan and President-elect Barack Obama. To put it mildly, Dorgan wasn’t too happy about Obama’s decision to add Larry Summers and Tim Geithner to his economic team.
“You picked the wrong people,” Dorgan said.
It’s downright sad when helpful advice from a friend is roundly ignored.
Oct. 4, 2011, 6:22 a.m. EDT
Further Greek aid delay feeds anxiety
Dexia woes highlight feedback loop between sovereigns, banks
By William L. Watts, MarketWatch
FRANKFURT (MarketWatch) — Financial markets were under renewed strain Tuesday after finance ministers from the 17-nation euro area further delayed a decision on disbursing Greece’s next round of aid and indicated private bondholders may have to suffer bigger losses on debt as part of the second Greek rescue plan approved in July.
Luxembourg Prime Minister Jean-Claude Juncker, who chaired a regular monthly meeting of euro-zone finance ministers that ended in the early hours of Tuesday morning, told reporters that a planned extra meeting for next week had been canceled.
A decision on the disbursement of Greece’s 8 billion euro ($10.7 billion) round of aid would take place in mid-November, after the completion of the review being conducted by the troika — the European Union, International Monetary Fund and European Central Bank — of international lenders, he said.
European equities fell sharply, led lower by banks. Worries about Greece were compounded by fears surrounding Franco-Belgian lender Dexia SA (BE:DEXB -15.23%), which saw shares fall more than 23% on speculation the institution could be split up.
…
Five questions for Bernanke
October 3, 2011, 2:24 PM
Federal Reserve Chairman Ben Bernanke will appear before the Joint Economic Committee on Tuesday at 10 a.m. Eastern to discuss “the economic outlook.” He’ll face questions from across the political spectrum, from the only elected socialist, Vermont Sen. Bernie Sanders, to tea-party favorite Jim DeMint, the Republican senator from South Carolina.
Rather than try to predict what will be asked, here’s MarketWatch’s stab at what could be timely questions for the central bank chief.
Just how effective will Twist be?
…
Why not buy bonds?
…
So, how about that economy?
…
How sure are you that U.S. bank exposure to Europe is ‘manageable’?
…
What’s your reaction to Bank of America and other lenders announcing debit-card fees?
Can the fed still walk down the street without a police escort?
…
Bank of America at lowest close since March 2009
October 3, 2011, 4:35 PM
Bank of America BAC, which led financial stocks lower in Monday’s bloodbath, closed at it’s lowest level since March 11, 2009, near the start of the bull market.
U.S. stock markets closed at their lowest levels in more than a year Monday and investors fled to the relative safety of U.S. treasurys.
…
Bank of America is twice as big as it was the last time it was deemed too big to fail. As are the other mega-banks.
The bigger they are, the harder they fall.
The bigger they are the harder to fail?
Dexia’s depositors and investors would told they were protected this morning. I’m sure BofA will be offered the same statement.
The Bank of America website was inaccessible yesterday morning and early afternoon. Not good for an outfit with millions of customers and their money.
The online banking was unavailable much of Friday through Sunday as well.
Who’d have guessed ingesting something as large and toxic as Countrywide wouldn’t end well?
I suspect they are keeping it offline on purpose.
Who’d have guessed ingesting something as large and toxic as Countrywide wouldn’t end well?
ISTR the HBB stalwarts saying that this deal would go down like a spicy meal in the digestive system of someone susceptible to heartburn.
+1 Steve J. And if I BoA, I would crash most of the ATM’s too, before the people start acting like the scene in It’s a Wonderful Life.
The price of BofA is not yet low enough: I’m rooting for a price of zero.
Maybe we are looking at Mr. Market finally doing a job that the regulators refused to do.
In the long run, intervention is dead, and fundamentals rule.
In the long run, intervention
is deadbecomes Warlike, [and then] fundamentals rule.So who’s going to buy the Chapter 7′d carcass? Wells Fargo?
I still want a public option bank. POB would offer only a few services: checking and e-banking, all savings/CD’s would be done through Treasuries only, and basic individual loans up to conforming limit of $417K with no sale on the secondary market. Must show citizenship/residence papers. Put one teller, two online stations, and two ATM’s in every post office. Wouldn’t that put a bee in the banking bonnet. Bah, probably unconstitutional.
The single payer bank!
North Dakota figured out a way…check out the Bank Of North Dakota. Almost makes you want to move there.
well, not really, but everything I’ve heard/read about the bank is that it’s quite well run
Bah, probably unconstitutional.
The constitution can be changed.
ISTR reading that the state of North Dakota set up a state bank during the Depression. It’s still around and, last I heard, it’s kicking right along.
More deflation??
A few weeks ago, I read that BAC’s market cap was less than half of its book value. Not a good sign.
Anyone have an update on the BAC market cap/book value ratio?
This assumes that “book value” means anything anymore, with this new-fangled “Mark to Fantasy” accounting that’s all the rage….
below $5 triggers a lot of “sells.”
“The price of BofA is not yet low enough: I’m rooting for a price of zero.”
Even Countrywide never got to zero. But they were bought by BofA. Who will buy BofA with no more bailouts in the offing?
Based on yesterday’s low level, the Global Dow stock market index is off from its 52 week high by (1,644.82/2,270.47-1)*100 = 27.6%. By comparison, a drop in share prices over 20% is considered bear market territory. This magnitude of decline is enough to send a bear into hibernation for the winter.
Global Dow
DJI: GDOW
Market closed 1,648.28
Change -27.47 -1.64%
Volume 2,124.19b
Oct 4, 2011 8:33 a.m.
Previous close 1,675.75
Day low 1,644.82
Day high 1,675.70
Open: 1,675.70
52 week low 1,644.82
52 week high 2,270.47
Should U.S. housing market investors worry that a 27%+ decline in global stock prices might spill over into the value of their real estate holdings?
Or is it safe to assume at this point that the real estate and stock markets are decoupled, similar to how the Asian and U.S. stock markets are purportedly decoupled?
This is a man after my own mind:
“Decoupling is a myth,” says Stephen Roach, chairman of Morgan Stanley Asia. “In the aftermath of the post-Lehman demand shock in the developed world, every single Asian economy either slowed sharply or tumbled into outright recession. How can anyone call that decoupling?”
“Efforts to spur domestic spending include beefing up health-care protection and retirement benefits that will ultimately convince people that it is safe to buy more now and save less for a rainy day. ”
So Asia can go bankrupt in 2060 just like American did in 2013.
I wouldn’t want to have to sell into this - plus all the usual seasonal factors. When closing on my sale late last July there was no way of me knowing the market was just days from starting its precipitous decline - and even then things were bleak.
Bulletin — S&P 500 slides into bear-market territory
Percentage decline off 52 week high:
(1,084.84/1,370.58-1)*100 = -20.8%, and that is just the nominal decline, which does not reflect dollar inflation.
S&P 500 Index
SNC: SPX
Market open 1,084.84
Change -14.39 -1.31%
Oct 4, 2011, 9:35 a.m.
Previous close 1,099.23
Day low 1,084.84
Day high 1,097.42
Open: 1,097.42
52 week low 1,084.84
52 week high 1,370.58
Housing Market Failing to Clear: The Ticker
By Mark Whitehouse Oct 3, 2011 1:26 PM PT
The market isn’t doing a very good job of cleaning up after the housing bust,…
Banks are taking ever longer to get houses through the foreclosure process, onto the market and into the hands of new owners. As of August, the average mortgage borrower in foreclosure hadn’t made a payment in 611 days, according to data provider LPS Applied Analytics. That’s up from 599 in July and more than double the level of three years ago.
…
That’s odd, I thought the banks had ‘worked through the paperwork issues’ surrounding the robo-signing fraud, and the foreclosures were flowing freely.
Any problem that has been around for over eight years will naturally take some time to fix.
Inspector General: Fannie Mae Was Told About Foreclosure Abuse In 2003
Categories: National News
09:05 am October 4, 2011
by Mark Memmott
A foreclosure/price reduced sign stands in front of a home for sale on February 11, 2011 in Miami.
Joe Raedle/Getty Images
One of the hottest stories this morning is word that, as The Associated Press puts it, “mortgage giant Fannie Mae knew about allegations of improper foreclosure practices by law firms in 2003 but did not act to stop them, a government watchdog says.”
So-called foreclosure-mills and the practice known as “robo-signing” have been among the scandals related to the nation’s housing crisis. There’s evidence that not only did lenders give mortgages to many people who really did not have the financial means to make their payments, but also that when it came time to foreclose on such properties there were rampant abuses.
Now, in this report from the Federal Housing Finance Agency’s Office of Inspector General, it’s stated that:
The inspector general office adds that it “could not establish” that Fannie Mae notified the Office of Federal Housing Enterprise Oversight about the May 2006 report.
…
I like how these guys take three numbers from a dense 27-page powerpoint and 30 minute commentary to write an article.
As a hint, the real story isn’t the 611 days, or the 38% of loans over 2-years delinquent. It’s an interesting report, I studied it last night and listened to the commentary…if I wanted to sum it up in two sentences (not two numbers):
States with a judicial foreclosure process are screwed.
States with a non-judical foreclosure process have been efficiently moving through their inventory and will be the first to emerge from the foreclosure mess.
THIS IS THE STORY THAT NO ONE IS WRITING ABOUT.
Look through the presentation, and listen to the 30-minute commentary if you want to get the flavor.
http://www.lpsvcs.com/LPSCorporateInformation/ResourceCenter/PressResources/Pages/MortgageMonitor.aspx
Page 3 - Most of the inventory is snarled up in the 90+ and foreclosure inventories; 30-day and 60 day inventories are below January 2008 levels, and have been on a downtrend since January 2009.
Page 6 - Non-judicial states have been improving their non-current% faster than judicial. As an example, CA was in the top ten worst not long ago (18 months ago +/-), now CA has 26 states worse than them.
Page 19 - Judicial states inventory is 6 months more aged than non-judical states. As long as judicial states are slow and non-judicial states are not, this will continue to widen.
Page 22/23 - Note the difference in non-judicial vs. judicial…the worst non-judicial state (92 months of inventory) is still better than the average of the judicial states. The 10th worst non-judicial state is at 35 months…CA, NV, and AZ are not in the top-ten of non-judicial states (meaning even lower than 35)–how much lower? You’ll need to pay $1,000 per month for a minimum of 12 months to get that data…they won’t tell you in the free PowerPoint.
UH oh…….fannie knew of robo signing in 2003
http://finance.yahoo.com/news/Govt-report-Fannie-knew-of-apf-3965362442.html?x=0&sec=topStories&pos=4&asset=&ccode=
Complete shocker!
Fannie was a private sector company in 2003, but I’m sure somebody will blame Obama.
Those darn, out-of-control robots. They really messed up a good thing.
‘fannie knew of robo signing in 2003′
Wouldn’t it have been better if these loans were never made? Wasn’t there a criminal investigation by the DOJ of Fannie personnel in 2004? Should both of the GSEs have been de-listed in 2005 when they couldn’t produce financial statements?
Everybody knew that.
Neither the democrats nor republicans did a damn thing to shut Fannie down.
March 2005:
‘Smartmoney.com reports “Fannie Mae shares sank to a new low, losing 4%, after The Wall Street Journal reported that regulators are probing instances of employees falsifying signatures and accounting records.” Reuters is late to the story as well.’
Readers of this blog will remember I reported on these irregularities on March 9th. See:Agreement Gives Insight Into Fannie Mae Scandal. “The implementation of controls surrounding accounting ledger journal entries,including policies that prohibit the falsification of signatures..adoption of internal controls that limit the ability of personnel to overwrite database records.”
And on the 15th: “As it became known last week, Fannie employees have been “falsifying signatures and altering information in databases” and were “not isolated incidents’
http://thehousingbubble.blogspot.com/2005/03/smart-money-last-to-get-word.html
Again, wouldn’t it have been better if these loans were never made?
Short answer: it depends on who you are.
For the populace in general, yes.
For the originators who hit a nice quarterly number and walked away with a pile of fees, HELL NO.
What I’m saying is, the AP is gonna focus on ‘robo-signing’ now?
Why weren’t some of these executives in jail in 2004? Who dismissed the investigation? Who at the SEC failed to press the stock exchanges to de-list the GSEs in 2005? That alone would have stopped the US housing bubble in its tracks.
Think of the current misery that could have been prevented by that one thing.
Here’s a little red meat, AP. The people that let this go on are STILL IN CONGRESS!
Do you think anyone would have the slightest problem with Robo-singning if housing prices were still on the rise and everyone was still busy flipping and heloc-ing? Robo-singnig fraud is the scapegoat de-jour for FBs and other losers who lost to the house in the casino that was the housing bubble.
“…..AP is going to focus on robo-signing now?”
Better late than never, I guess.
But like you say, until they start naming the names of the current, sitting Congressman who aided/abetted, it just a big waste of paper/airtime.
They could start by taking a look at every Conressman/Senator from New York, Massachussetts, and Connecticut.
To answer your quesiton Ben, the FBI reported a huge rise in mortgage fraud at all transaction levels but were SPECIFICALLY directed, by Bush, Rove, Cheney et al, to focus on terrorism and ignore the fraud.
Yes, this is documented by the FBI and is avaiable to the public, but you will have to Google it.
“Everybody knew that.
Neither the democrats nor republicans did a damn thing to shut Fannie down.”
they’re still doing nothing.
George Bush was afraid to shut down fannie for fear he might be called a “racist”.
Everybody knew that.
Neither the democrats nor republicans did a damn thing to shut Fannie down.
Bush wrote 11 letters to the Democrat controlled House (Frank) & Senate (Dodd) asking for “oversight” of Fannie.
The Bush administration proposed transferring oversight of Fannie Mae and Freddie Mac by creating an independent agency to supervise these GSEs (September 2003).
Bush was called a racist and then Barney Frank went on to belittle the inspectors warning of these issues in congressional hearings. You can see these hearings on YouTube.
Bush didn’t have to “ask” anyone. He owned the senate AND the house for 4 years.
Yeah, they weren’t interested much in “privatizing” Fannie/Freddie back then, were they?
Banks didn’t have a problem telling minority borrowers to go pound sand, until they figured out a way to make a buck on it (by securitizing the crap, and making a commission off the sale)
You know, there are a lot of locally owned banks that had to operate under the same rules that the NYC banksters did, and they don’t seem to have a problem with their loans to minorities.
Of course, they didn’t give a Fresno strawberry picker making 24K/year an $800,000 loan.
“Those darn, out-of-control robots.”
The Three Laws of Robotics:
1. A robot may not injure a human being or, through inaction, allow a human being to come to harm.
2. A robot must obey the orders given to it by human beings, except where such orders would conflict with the First Law.
3. A robot must protect its own existence as long as such protection does not conflict with the First or Second Laws.
I’d hate to be the programmer trying to define what ‘inaction’ means in terms of Law #1. The robot would never work, it would constantly be on the lookout for humans in trouble, ala Superman.
Building the self-defense logic to make the robot fight other robots for Law #3 would be way more fun.
Those robo-signers are more like Cylons than Asimov’s robots (say like R. Daneel Olivaw)
thinking of going as a robo-signer for halloween.
‘Those darn, out-of-control robots. They really messed up a good thing.’
http://www.robotcombat.com/video_oldglory_hi.html
That’s the reason there was robosignings later.
They didn’t have enough people to properly make the loans.
And they didn’t have enough people to properly foreclose.
Those had been decent middle class jobs. They were dispensed with, and more of the financing fees went to executive pay.
“They didn’t have enough people to properly make the loans.”
That’s why Wall Street investment banks should stand clear of the mortgage lending business. Given their far more lucrative alternative activities, they cannot afford the opportunity costs of properly allocating personnel to mortgage lending and servicing activities.
Domo arigato, Mr. Roboto.
From the Denver Post:
National Renewable Energy Lab in Golden to cut 100-150 jobs through buyouts
“In both a symbolic and real-world blow to green energy development and the jobs renewable industries are meant to create, the National Renewable Energy Lab in Golden announced significant job cuts Monday. The Golden lab, which saw tremendous investment as part of President Barack Obama’s stimulus efforts, said it will use voluntary buyouts to cut 100 to 150 jobs. Currently, the lab employs about 1,350 people. Its mission is to foster research and development for the U.S. Department of Energy. NREL spokesman Bob Noun said the jobs were a victim of the gridlocked Congress and that budget forecasts led the lab to look for more than $8 million in savings.”
$53,333.333 per job. Yeah, real lavish.
the jobs were a victim of the gridlocked Congress
(I believe there is a HBB poster who worked there as a sub-contractor?)
Nope. Never been a better time to refinance debt, provided you have a credit rating that enables you to borrow…
This was meant as a response to aNYCdj’s comment about cut rate refinancing of Uncle Sam’s debt…
So, the Global MegaInc.’s that produce widget$ incorporated the “Bidne$$” tool/template of JIT; “just-in-time” = low/no inventory co$ts
Seems the Global Financial Indu$trial Complex as adopted a likewi$e $trategy:
JIT / UFA = “Urgent Financial Aid”
JIT / SNFA = “$overeign Nation Financial Aid”
JIT / ISNFA = “In$olvent Nation Financial Aid”
Producing digital coma’$ = “hard work”
Who ate my green shoots?
Oct. 4, 2011, 10:00 a.m. EDT
Bernanke not optimistic about labor market
By Greg Robb
WASHINGTON (MarketWatch) - A close reading of recent economic data doesn’t show any hint of improvement ahead for the weak U.S. labor market, Federal Reserve Board Chairman Ben Bernanke said Tuesday. “Recent indictors, including new claims for unemployment insurance and surveys of hiring plans, point to the likelihood of more sluggish job growth in the period ahead,” Bernanke said in testimony prepared for the Joint Economic Committee of Congress.
…
“Recent indictors, including new claims for unemployment insurance and surveys of hiring plans, point to the likelihood of more sluggish job growth in the period ahead,”
Guy’s a real genius.
I’ve been noticing a few new posters lately. Welcome to HBB, and we’re glad you came out of lurkdom!
(We need new blood to keep us reg-lars from going too partisan.)
Yesterday late, zee_in_phx posted a lament for the poor Section 8’s, and how the housing authority only handed out Section 8 money based on “market rent.”
So who decides the market rent? That would be the landlord. LL sets high prices and dares Section 8 to meet it, or dares the military allowance to meet it. The bleeding hearts at the Housing Authority meet it mostly, even if the tenants themselves have to double up. Section 8 money doesn’t have to pay for ALL the rent, just most of it. So a 5-bed house gets $2100/month Section 8. The Section 8 family can invite another family or a roomie. Both parties come up with $500 each per month, and suddenly the “market rate” of a 5-bed is now $3000, NOT $2100. See how that works?
And the non-Section 8’s have to pay all $3000 out of their own pocket (instead of $2100) — and, by the way, they don’t get any more amenities. And I realize that a Section 8 complex is subject to “inspections.” So if the LL chooses not to take Section 8, then he can let the place go to pot? It’s nice to know that the poor are entitled to better-kept properties than those with the jobs.
[And all of this applies even if the Section 8 tenants are well-behaved and quiet as mice.]
“I’ve been noticing a few new posters lately. Welcome to HBB, and we’re glad you came out of lurkdom!”
I was noticing the same thing, oxide. Welcome to the blog, newcomers!
C’mon, HBBers, hows about a little love fer the newbies? Let’s give ‘em a warm HBB welcome!
I always try my best to give newbies a warm HBB hello!
Hello Guys, long time lurker and occasional poster. I can confirm that:
Florida is a major disaster area where the property taxes and association fees make even the foreclousures not viable.
Australia seems to only be building houses for Chinese investors at this point. They are all priced beyond the means of the locals.
Thailand has several shopping malls with stores that sell condos. I am sure this will lead to a chronic oversupply, but at least the condo fees were around $14 a month.
At least half the guys I grew up with are now in their 40s have all left the states to work overseas. We would all like to come home but it doesnt look like it will happen anytime soon.
“At least half the guys I grew up with are now in their 40s have all left the states to work overseas. We would all like to come home but it doesnt look like it will happen anytime soon.”
Yours must be an interesting demographic. I don’t know ANYONE who has left the USA to work overseas, except for a handfull of kids who briefly taught English in China.
Correction, I do know a couple of guys at HP who had short term stints overseas, but they came back after 2 years or so.
I’ve met a few of various ages. While the travel is hard, the pay is good.
Welcome newbies from all us oldbies!
Here’s another HBB oldbie saying welcome aboard!
Loooooong-time lurker here, from Slim’s hometown, Tucson, AZ. I posted for the first time a few weeks ago, and it was suggested I was a puppet for Rio! (an easy mistake to make)
The Section 8 family can invite another family or a roomie. Both parties come up with $500 each per month, and suddenly the “market rate” of a 5-bed is now $3000, NOT $2100. See how that works?
More likely the Section 8 family pockets the extra $1000…
No, the 8’s don’t have the extra $1000.
The apartment LL knows full well that Section 8 will give them $2100, and so LL raises the rent to $3000 or so and dares the Section 8s to renew the lease. With a roomie, the 8’s renew the lease, collect subsidy, and pitch in~$500 a month each (or $1000 by themselves, however you want to slice it. And yeah, I’m fudging the math a little).
So now you have tenants happily getting by on $3000 a month rent. LL sees happy tenants, and raises the rent to $3200 a month. Housing Authority, always a step behind,
sees that “market rent” 
is now $3000 a month, and raises the Section 8 subsidy to $2900. LL sees the $2900 Section 8 subsidy, raises the rent to $3900, and dares the tenants to pay it. Tenants and roomie renew, take the subsidy, and again pitch in $500 each. LL sees happy tenants…Rinse and repeat.
Notice that the Section 8’s never paid more than $500 a month rent since the beginning. They don’t feel the rent increases. Meanwhile, some poor schmo WITH A REAL JOB had his rent raised from $2100 to $3900. Even with a roomie he’s still paying three times the rent for the same amenities as the Section 8’s. How fair is that???
Now you guys know why rents never go down, and why I am clamoring to buy a house with a fixed payment, even if house prices still have 10-15% to fall.
Look, I’m all for housing the poor in some fashion, but I see no reason for the poor to enjoy the same exact housing for 1/3 the price, not on a large scale. If they are paying 1/3 the price, they should stay in housing that’s 1/3 the quality. (roughly)
How come you guys didn’t tell me BoomBoom Brannigan died? Good grief.
http://www.timesunion.com/local/article/Radio-DJ-Boom-Boom-Brannigan-dies-at-82-714683.php
If it’s not one thing, it’s another — or lots of things, all collapsing at the same time.
Warning signs from developer capitulation
Commentary: Watching fallout from shadow lending ‘time bomb’
By Craig Stephen
HONG KONG (MarketWatch) — While China’s domestic stock markets are closed for the week-long National Day holidays, there is no respite for mainland Chinese developers listed in Hong Kong, who could face another selling onslaught.
Following steep falls last week, the share prices of various mainland developers including Agile Property (HK:3383 +4.75% AGPYY %) and Evergrande Real Estate (HK:3333 +7.37% EGRNF 0.00%) are now down as much as 60% since August.
The official line that Beijing has been steering the property market to an orderly cooling now looks rather hollow. The dramatic collapse in developer share prices looks like a ragged investor capitulation. Could the same fate lie ahead for the Chinese property market?
Investors preoccupied with European debt may find a “hard landing” for the Chinese economy is the next worry to take center stage.…
For those who say there are no jobs:
http://www.ajc.com/news/georgia-politics-elections/report-farm-labor-shortages-1194039.html
They might not be the best-paying, easiest, cubicle-sitting jobs ever available, but they are jobs going unfilled by a broken system which pays potential workers not to work. EBT and UE need to be pared way down and America needs to get back to work.
Liz:
Now your in my area.You are 1/2 right.and the other 1/2 severly wrong,
Forcing people to do degrading work is punishment, not helping. The system is designed by congress to make work NOT pay.
For example if you out of desperation and bordom take a job while on UI and the boss winds up a jerk, or a pervert and fires you and claims you were the jerk. UI will stop your check until a hearing. that could be 6-8 weeks. because the rules are the last job determines wether you get UI.
SO why take that big a risk in todays economy???
Forcing people with EBT cards to mop floors is pitiful….I guess those conservatives want to really really punish people. Instead what most people with EBT cards need is to learn how to read, write and speak ENGLISH. Force them to sit in English and math classes for their check, now thats TORTURE!!!! (especially if they speak Ebonics)
And for those that have a good grasp of the English langauge, have them in some short job training and/or allow them to INTERN at job that has a direct releation to their resume so a recent “job” is at the top, and will make them more employable…
Liz…Stop with the hatin’
The democrats solution to everything is “job training centers”.
Exactly what are these “jobs”, “make work”? Digging holes and
filling them up again?
And the trouble with job training is right in the name. It’s training for jobs. Not a whit of being entrepreneurial enters the rooms of the job training classes.
Not that being entrepreneurial is easy. Trust me, it’s not. I’ve been hustling gigs for several weeks and there aren’t any in the offing.
However, over in the job world, there’s at least one person in every company doing the same thing. It may be the boss, pounding the pavements as she looks to open new accounts. Or it may be the sales guys and gals, calling on potential customers.
Slim you are right, but my first step is to be able to understand English.. Then comes the “entrepreneurial enters the room”
The problem with job training is that there are no (longer) jobs to train into. Wasn’t that knd of training akin to teaching the unemployed how to turn on an outdated computer and perform simple data entry or similar? Well guess what — those jobs are gone.
Unemeployment statistics over 4% are not cuased by lazy people.
“Forcing people with EBT cards to mop floors is pitiful”
Who exactly do you think should mop the floors?
People that want the job.
If You hard line conservatives really want punishment of poor people…then support my plan of making them speak English for the assistance……I’ll bet 1/2 will quit the first month.
People that want the job.
Nobody wants the job; EBT and UI is same money without the sweat.
Stop with the whining and pick up a mop. Survival ain’t supposed to be pretty.
I can remember doing pick up a mop jobs shortly after I graduated from college. Economy sucked bigtime in the early 1980s, and I was happy to be working at all.
What did I learn? Well, I learned to be very nice to people who do cleanup jobs.
Slim
I pushed a mop in a grocery store when in school and used the money to help pay for university. Went thru with almost no student loan !
Keep the water hot, clean, and dry the mop into another pail - and you finished much faster.
Today I never walk over top of anyone else’s wet mopping.
I was very lucky to have that job.
Stopped by Sprouts (formerly Henry’s, like a Whole Foods) to pick up a couple packages of their great chicken thighs for $1.39 per pound. They are all natural and taste way better than Foster Farms or Zacky. They sold out over the weekend.
Took my $5.50 purchase to the cashier and wound up behind a woman who was very well dressed and obviously from the Middle East. (Language and garments) She bought over $103 in groceries, mostly organic.
She put $22 on her credit card. The rest? Food stamps! WTF?
Does she also game the system as a Section 8?
I wanted to see what kind of car she drove, but she was far faster than me in her getaway.
Robin
Sprout’s is my veggie haven. I drop no more than $15 and I’m set for 5 days. I add my lean proteins from Costco, and I’m good to go. I L O V E S P R O U T ‘S!
Whole Foods has a lot of fake health foods, imho.
Know anyone allergic to gluten and milk? (I am-both)Almond Dream Frozen Dessert is fantastic (Sprout’s).
The well dressed EBT card thing makes me nuts, too.
$103 is my food bill for 3 weeks.
Ours for four!
Right.
America has an economy based on making houses and malls and such that we can trade amongst each other. We subbed out making stuff that people outside the US might buy from us. The path is reversable, but it will take many tough years to reinvent ourselves. It frustrates me to be waiting so long for signs of first steps. I guess, like an addict or psychotic, we haven’t sufficently hit bottom yet.
Gee, maybe they wouldn’t have a problem filling those jobs, if they actually paid more than about $5 bucks/hour they are paying the illegals.
You can’t have it both ways. either you are going to have a bunch of wage inflation, or a bunch of deflation so that prices match those $5-10/day incomes. If you choose deflation, you had better be ready to write off about 100 gazillion dollars of never-to-be paid back debt.
The PTB don’t want deflation in anything, except J6Ps paycheck.
Yep. Marie Antoinette didn’t get it either.
Legislation is pending in Congress to mandate the use of E-Verify nationwide.
Legislation is pending in Congress
Legislation is pending in Congress
Legislation is pending in Congress
Legislation is pending in Congress
“TrueDoNothing’$™ / “TrueObstructionist’$™ / TrueGridLocker’$™” = “get lil’ Opie!”
Foghorn: “Did ya see that hawk after those hens? He scared ‘em! That Rhode Island Red turned white, then blue. Rhode Island, red white and blue! That’s a joke, son, a flag-waver! You’re built too low. The fast ones go over your head. Ya got a hole in your glove. I keep pitchin’ ‘em and you keep missin’ ‘em! Ya gotta keep your eye on the ball! Eye. Ball. Eyeball! I almost had a gag, son–a joke, that is!”
Unfortunately, it will not be limited to job applicants only. DHS wants to use it as well.
Sellers getting desperate in China
Should not be a problem unless they are highly leveraged
And that people are buying property at 2-3x income
Oh wait…
———————-
Some Anecdotes About Chinese Real Estate, As Told By Deutsche Bank Business Insider | 10/04/2011 | Also Sprach Analyst
Yesterday, Deutsche Bank Economist Jim Ma and his team came up with a report, turning somewhat more bearish on China after the Hong Kong/Chinese markets got really killed.
They are now expecting GDP growth to slow to or below 7%, and are worried about the exports picture (and among other things).
On the real estate market, Jun Ma and associates told an interesting story on the latest development.
In recent weeks, the number of phone calls received by an author of this report from China-based property agents has increased several fold, indicating a significant rise in the urgency for developers to raise cash from selling properties. A property consultant told us that he recently received requests to help raise RMB10bn for cash-strapped small and medium-sized property developers – this amount is a huge multiple of what he is used to dealing with. In the offshore market, where many Chinese developers seek foreign currency funding due to lack of access to domestic funds (the domestic stock, bond and trust loan markets are closed to them due to policy tightening, and banks are also very stringent), their USD bond yields have surged to 20-25% in past weeks from around 10% before August. This means that even the offshore markets are now largely closed to Chinese developers (see Figure 4).
All these suggest that many developers are now under greater pressure to sell their properties at a bigger discount in order to avoid a liquidity crisis. An emerging consensus from potential buyers and some developers is that a 10% drop in prices in the coming two quarters would be justified.
A further decline in physical property prices will likely reduce the incentive for developers to start new projects, and thus implying a deceleration in real estate FAI.
“All these suggest that many developers are now under greater pressure to sell their properties at a bigger discount in order to avoid a liquidity crisis. An emerging consensus from potential buyers and some developers is that a 10% drop in prices in the coming two quarters would be justified.”
Now it will only take 53 years salary to buy a place in Bejing!
I went short China with (FXP) last year, a little early, but it is doing very well lately.
The government tick keeps growing…
From 2010 to today, the private sector lost 3.6 million jobs while the govt added 1.7 million.
Prosperity through larger and larger government…
————————–
Federal Employment Grows Despite Downturn
Mercatus.org | 10/4/11 | Veronique de Rugy
In the midst of the current economic downturn, there is one group that seems to be prospering: public employees. While the private sector is struggling to grow and create new jobs, federal government jobs are doing quite well.
This week’s chart by Mercatus Center Scholar Veronique de Rugy shows the growing number of federal government employees. Using the latest data for annual government employment from the Bureau of Labor Statistics, the chart shows that relentless growth in public sector employment largely overshadows private sector employment.
In 2010, there were 22,482,000 government employees. That’s an increase of 1,692,000 employees since 2000. During the examined time period, public employment has grown at an average rate of 0.8% each year—in contrast to the -0.3% average annual rate of private employment decline. From 2000 to 2010, the plummeting employment has been concentrated in the private sector. A total of 3,658,000 private sector jobs have been lost. All the while, public employment continues to increase.
“The Mercatus Center was founded by Rich Fink, former president of Koch Family Foundations…… ” (Wikipedia)
(So once again, my “Bogus/Doctored Stat Detector goes off……)
So, lets check the article. No breakdown, of course.
Does this 1.7 million include the 60,000 new TSA employees?
Or the 50,000 new active duty military personnel?
Or the 152,00 military contractors in Iraq and Afghanistan alone?
Or the 100,000 new DoD civilian employees?
There’s 360,000, and I’m not even looking hard……..
So, assuming that there was no additional hiring to fight the GWOT, that makes about 1.4 million. This assumes that their 1.69 million number isn’t an inflated/fudged number by itself.
So, Federal Employment went from 20.5 million to something less than 22 million. About a 5% increase over 10 years.
During the same time period. the “official” US population increased by almost 10% (but this may not include 10-20 million illegals)
As far as the bogus private/government employee ratio……..the government didn’t kill/outsource 7-10 million (or more)jobs.
Unless you like the ratio of public employees in Somalia, you still have to hire all those cops.regulators/enforcement personnel, whether you have any civilian employment or not.
I believe that the 22 million number includes federal, state, county, municipal and school district employees.
…while the popluation growth as a whole remained static.
Oh wait…
So, this morning while walking to the post office, I saw white non-Hispanic men doing landscaping work.
Here, in Los Angeles.
Interesting.
a white non-middle eastern man was at the 7-eleven check out the other day.
Doing a job that East Indians won’t do?
I’m seeing the same thing here in Tucson. Non-Hispanics doing landscaping and construction work. Didn’t see much of that five or six years ago.
Also expect to see them living 3-4 families to homes in the not too distant future. Driving 15-20 in vans, and hanging out at street corners waiting for work.
“So, this morning while walking to the post office, I saw white non-Hispanic men doing landscaping work.”
That isn’t all that uncommon in flyover country.
I can match that. I stayed at a hotel in August, and all the maids were white and spoke English.
This reminds me that our hotel in Kalispell, MT had English-speaking Asian housekeeping personnel. Most unexpected.
HR funny of the day….
Son in law is going thru orientation for a new job. Got the “sexual harassment” briefing a day or two ago.
The trainer told them that the work “dikes” must be banished from the workplace, and the term “diagonal cutters” used instead.
(Nevermind that diagonal cutters have been called “dikes” a long time before most of us knew there were any other kind around)
One guy asked if “Alternative Lifestyle cutters” was acceptable……..
True story: A few years ago, I was having some electrical work done at the Arizona Slim Ranch. As is my custom, I work alongside the people I hire. It’s called learning-by-doing, and I enjoy doing that.
The electrician I hired was one of the longest working woman electricians in Tucson, and let’s just say that she was a woman with a preference. She’s the one who taught me to refer to “diagonal cutters” as “dikes,” and she didn’t see the slightest bit of irony in it.
I could tell you the story about how aircraft tooling is called assembly “fixtures” now……
The guys who named Rick Perry’s ranch must have given them their previous name.
Or the color code on resistors…
umm…
That’s nothing new - what do you think Black Jack Pershing real nickname was?
We are a society of morons, who think making everyone else adjust their language to suit us makes our little world better.
Adam Carolla has a very funny rant on that subject. Apparently he was sharing the couch on a late night show with fellow guest Queen Latifah. Apparently there are rumors about her sexuality. She had been talking about her trip to Jamaica and how the word Limon(?) was used there a lot. He as a blue-collar kind of guy said something in answer to an unrelated question and accidentally included the term “lineman dikes” in the sentence. Sounded too similar and things went horribly wrong from there, I guess…
“One guy asked if “Alternative Lifestyle cutters” was acceptable……”
I think I just hurt myself laughing.
“A Bunch of Morons in Washington”: Howard Davidowitz Handicaps the Debt-Ceiling Debate
July 2011 - I love the anger and thruthiness. I like this guy.
http://finance.yahoo.com/blogs/daily-ticker/bunch-morons-washington-howard-davidowitz-handicaps-debt-ceiling-145318806.html
BB,Today sez… The FED is ready to “do” more. So I guess old QE-3 is being loaded with fuel ready for her launch soon.
This comes as a complete schock… To no one!
The Fed is to Congress as the Creature is to Dr. Frankenstein. This expressed willingness to “do more” is a signal to Congress that the Fed will do as it is asked, but only if asked to do something. You will not find BB stepping up to the plate on his own, without Congressional support, when major presidential candidates are leveling charges of treason at him.
As of September 30th the Treasury Department reported the public debt at $14,790,340,328,557.15. This is less than $10 billion from cracking the $15 trillion dollar level.
No one in command of his senses expects the federal government to pay its debt except by repudiation. . .either outright default, or - more likely - an effort to debauch the currency even further through the mechanism of inflation, thereby paying back only a few cents on each dollar.
Give it up man, gold has rolled over and is dieing.
Give what up? The comment is on our national debt.
You have some weird/strange fixation with the price of gold, why on earth do you care about what it’s price is doing?
DYING.
You have some weird/strange fixation with the price of gold, why on earth do you care about what it’s price is doing?
Give it up man, gold has rolled over and is dieing.
It’s only dying because of liquidations by hedge funds due to margin calls and redemptions and margin hikes by commodities exchanges… in other words, the weak hands and leveraged paper players are being washed out and the strong hands are accumulating on the weakness.
Buy the dip, sell the rip… once these weak sellers are forced out, it should move higher. Central banks have a monetary stimulus hammer in their toolbox and everything looks like a nail to them.
FICO Survey Says: “Sharp and Deep Turn to Pessimism” -Housing
Sept 30th
http://finance.yahoo.com/blogs/daily-ticker/fico-survey-says-sharp-deep-turn-pessimism-195145746.html
I see nothing here the HBB hasn’t already covered at considerable length. Seems the rest of the world is just waking up from denial…
…
FICO’s quarterly survey of bank risk managers shows a “sharp and deep turn to pessimism,” as CEO Mark Greene details in the accompanying video.
“Across the board [there's] unhappy news” in the survey, most notably in housing, Greene says.
According to the survey, 73% of bank risk managers expect mortgage foreclosure to rise in the next 5 years and 49% predict housing prices won’t return to 2007 levels until 2020, at the earliest.
If true, America could be looking at “a decade of housing disaster,” which will prompt more and more homeowners to ‘walk away’ from under-water mortgages, Greene says.
Unfortunately, the bad news is not limited to housing.
…
Anyone know why gold is dropping like a rock?
going back to $800, loss of confidence, profit taking.
So basicly the bubble bursting?
They ran out of shoeshine guys to buy in.
See my other post… forced selling by hedge fund due to margin calls and redemptions and margin hikes by commodities exchanges.
Weak hands are selling, strong hands are accumulating.
“Second Wave of Protests Unleashed: Targets the Federal Reserve”
http://www.washingtonsblog.com/2011/10/second-wave-of-protests-unleashed-targeting-federal-reserve.html
Obama Wants to Ease Way for Debt Collectors to Call Cellphones
October 04, 2011 | Associated Press
WASHINGTON — To the dismay of consumer groups and the discomfort of Democrats, President Obama wants Congress to make it easier for private debt collectors to call the cellphones of consumers delinquent on student loans and other billions owed the federal government.
The change “is expected to provide substantial increases in collections, particularly as an increasing share of households no longer have landlines and rely instead on cellphones,” the administration wrote recently. The little-noticed recommendation would apply only to cases in which money is owed the government, and is tucked into the mammoth $3 trillion deficit-reduction plan the president submitted to Congress.
Despite the claim, the administration has not yet developed an estimate of how much the government would collect, and critics reject the logic behind the recommendation.
“Enabling robo-calls (to cellphones) is just going to lead to more harassment and abuse, and it’s not going to help the government collect more money,” said Lauren Saunders of the Boston-based National Consumer Law Center. “People aren’t paying their student loans because they can’t find a job.”
Whatever the impact on the budget deficit, the proposal has aligned the White House with the private debt collection industry — frequently the subject of consumer complaints — at a time when the economy is weak, unemployment is high and Obama is embarking on his campaign for re-election.
Democrats in Congress who frequently support the president, including Senate Majority Leader Harry Reid of Nevada and House Democratic leader Nancy Pelosi of California, declined through aides to say whether they favor or oppose the plan.
Mayor Michael Bloomberg, a billionaire who made his fortune as a corporate executive, has said the demonstrators are making a mistake by targeting Wall Street.
“The protesters are protesting against people who make $40- or $50,000 a year and are struggling to make ends meet. That’s the bottom line. Those are the people who work on Wall Street or in the finance sector,” Bloomberg said in a radio interview Friday.
Really?????????????????
out of touch much?
He’s right……they should be out in the Hamptons, or up in Connecticut. Palm Springs, etc.
Mayor Michael Bloomberg, a billionaire who made his fortune as a corporate executive, has said the demonstrators are making a mistake by targeting Wall Street.
Marie Antoinette didn’t get it either.
3rd term Mayor Bloomberg.
He got around that pesky 2-term limit.
Wrooonng.
Got the data right there. The mean payroll per worker in the Finance and Insurance sector in Downstate New York was $231,822 in 2010, according to the Bureau of Labor Statistics.
For all private workers outside the Finance and Insurance sector, the mean payroll per worker in Downstate New York was $57,806 in 2010, or 30 percent above the U.S. average. An advantage indicative of and cancelled out by a higher cost of living.
Oh, and they used to be a lot of people in finance in NYC who earned $40,000 to $50,000. They were back office workers, who did things like due dilligence. What ever wasn’t automated was outsourced following the early 1990s recession, and NYC lost tens of thousands of those “pink collar” jobs.
One reason the banksters make so much is there are fewer of them raking off money from the deal flow.
Miami-Dade County sends out pink slips to 300 workers
Miami-Herald
Workers across Miami-Dade County’s sprawling government received layoff notices as the county starts trimming spending under its new budget.
Miami-Dade County handed out some 300 pink slips to employees Monday as the sprawling government takes steps to live within a smaller budget for the fiscal year that began Saturday.
The number of layoffs, stretching across all departments from the library to water and sewer to the jail, is expected to rise to about 350 by the end of the week. The cuts are likely to spiral even higher in coming months if the county and its 10 labors unions don’t reach new concessionary labor contracts in coming weeks.
Mayor Carlos Gimenez, elected on a pledge to rein in spending, has warned employees and unions that the county will have to lay off substantially more workers if the new labor agreements aren’t in place by Nov. 1. Gimenez has said the tough stance is necessary to ensure the county stays within budget.
In September, the Miami-Dade Commission approved a new $6.14 billion budget proposed by Gimenez that reversed an unpopular property tax rate hike pushed through a year earlier. That cut the county’s revenue, triggering the plan to pare staffing.
The layoffs come as bitter medicine for Gimenez, who has also placed a high priority on spurring economic development and fostering job creation in the county, where unemployment is 12.2 percent.
“Every day that passes [without a contract], the more layoffs will be incurred,’’ said Greg Blackman, president of the Government Supervisors Association of Florida OPEIU Local 100, which represents some 4,800 supervisory and professional employees in two bargaining units. “We had layoffs today and we expect many more to be coming in November and December.’’
There are no give backs by public unions in bad times
Even right up to bankruptcy.
They would rather go with layoffs and throw their junior “brothers” right under bus rather than give up any perks.
You are flat out lying. There have been many, MANY give backs by unions during bad times over the last 30 years.
Tell that to the bond holders at General Motors who got the
shaft in favor of the unions. Bondholders who were the “little
people” in the middle class with 401k’s.
What!? I thought the “union goons” were untouchable and that taxes would soar to preserve their jobs and bennies!
What!? I thought the “union goons” were untouchable and that taxes would soar to preserve their jobs and bennies
And/Or the city cuts and cuts and then goes bankrupt.
That is becoming the trend of this decade.
And all the way along that sad road - the public unions refuse to give up anything…right into bankruptcy. And then complain when they get hammered in bankruptcy court.
And/Or the city cuts and cuts and then goes bankrupt.
I think we’ve been saying this all along.
Then again, even non union places like Texas are having huge budget issues.
A lot of people rushed into gov’t employment when Corporate America fired up the Big American Layoff Machine, hoping to find a safe haven. Most of us knew that wasn’t to be the case. Just as the underfunded pensions will either go bust or pay a reduced benefit as the taxpayers will refuse to bail out those pension funds.
I’ve never been much of a protester… but Occupy Wall Street splinter organization Occupy Phoenix is holding a protest on October 15th… I may show up must to check it out.
Just visited with the people at Occupy Denver in front of the state Capitol building, they are in this for the long haul
So far the police have not interfered, one of the organizers thinks the protest is a novelty.
The squad will be delivering them some food and bottled water to support their efforts.
*Thinks the police think the protest is a novelty
I’m going to be visiting the family up in Vermont.
Anyone know if the fall colors have peaked yet? My aunt keeps warning me about “stick season.” Which means that there’s a big rain that comes in, knocks the leaves off the trees, “whump” to the ground they go, and then it’s…
…stick season.
I’m not going to cancel this trip because the leaves won’t wait for me. This is a family visit, and that’s important.
I’m at 45 ° (pretty close anyway) north in Canada. Leaves here have just barely started to fall. Most of maple trees have all their leaves. If your going this weekend and want to see all the colours (Canada remember) then you won’t see much. I’d say two weeks.
I live in Ottawa Canada (45° north) The maple trees still have almost all their leaves. If you want to see them turn colours (Canada remember) I’d say in two weeks.
By the way, in August my wife and I stopped in Phoenix
Airport on the way to Mexico. In the airport there’s a highway below which the jetliners taxi! How bizarre!
‘Solar-coaster’ hits as sun sets on federal subsidies
By Wendy Koch, USA TODAY
Can it make it on its own? Can it compete with China, which U.S. officials say spent $33 billion in 2010 alone on solar loans?
Energy Secretary Steven Chu posed these questions Saturday, one day after finalizing the last federal loan guarantees via a controversial program that gave a half-billion-dollar loan to newly bankrupt solar panel manufacturer Solyndra.
“Where do we go from here?” Chu asked at the closing ceremony of the Solar Decathlon, a biennial U.S.-sponsored collegiate contest to build the world’s best solar house. He said the United States is at “a crossroads” and must decide whether to “sit on the sidelines and fall behind” or “play to win the clean-energy race.”
Chu said Americans invented solar cells, wind turbines and lithium-ion batteries, but added: “We are no longer the leading manufacturer … we are working to recapture that lead.”
The U.S. solar industry now employs more than 100,000 Americans, twice as many as in 2009, and has become the country’s fastest-growing energy sector, says Rhone Resch of the Solar Energy Industries Association, an industry group.
He says solar panel installations were up 69% at the end of June, compared with a year earlier.
Still, the industry produces less than 1% of U.S. electricity and has lost global market share to China in the last decade. Even backers say the collapse of Fremont, Calif.-based Solyndra, now being probed by House Republicans including California Rep. Darrell Issa, won’t help.
“It is reasonable to predict that we could have the collapse of the entire solar panel manufacturing business in America,” Issa, chairman of the House Oversight and Government Reform Committee, said at a House hearing last month as he cited China’s ascendance.
Not so fast, says energy historian Daniel Yergin, author of the newly released The Quest: Energy Security and the Remaking of the Modern World. He says the Chinese bring “a relentless competitive advantage in manufacturing,” but the U.S.’ tech savvy is vital in the swiftly changing solar market.
Even with subsidies decreasing, he doesn’t expect the solar industry to wither as it did in the 1980s when he says it entered the “Valley of Death.” Today, he says, “This is really global business. … This is not game over.”
whether to “sit on the sidelines and fall behind” or “play to win the clean-energy race.”
The “clean-energy race” so far has been the obama administration giving massive loans to unviable companies that kick back large amounts of that same money back to democrats and the obama administration…
Almost sounds like the “wall street TBTF race”…
As soon as any Amercian company becomes successfull in the green energy sector, the Chinese buy it out and move it to China.
Especially solar.
BEIJING, Oct 4 (Reuters) - An angry China warned Washington on Tuesday that passage of a bill aimed at forcing Beijing to let its currency rise could lead to a trade war between the world’s top two economies.
China’s central bank and the ministries of commerce and foreign affairs accused Washington of “politicizing” currency issues and putting the global economy at risk after U.S. senators voted on Monday to start a week of debate on the bill.
“Trade War”?…….oh no, you mean we might have to start making stuff here again, and quit letting the upper level whores give away our intellectual property for pennies on the dollar?
Not that! The world would come to an end, if that happened.
The party on the plus side of the imbalance has much more to lose from a trade war than the party on the deficit side.
02/08/2010
Greek Debt Crisis
How Goldman Sachs Helped Greece to Mask its True Debt
By Beat Balzli
Greek Finance Minister George Papaconstantinou speaking at a conference in January.
Goldman Sachs helped the Greek government to mask the true extent of its deficit with the help of a derivatives deal that legally circumvented the EU Maastricht deficit rules. At some point the so-called cross currency swaps will mature, and swell the country’s already bloated deficit.
…
Business
November 2011
California and Bust
The smart money says the U.S. economy will splinter, with some states thriving, some states not, and all eyes are on California as the nightmare scenario. After a hair-raising visit with former governor Arnold Schwarzenegger, who explains why the Golden State has cratered, Michael Lewis goes where the buck literally stops—the local level, where the likes of San Jose mayor Chuck Reed and Vallejo fire chief Paige Meyer are trying to avert even worse catastrophes and rethink what it means to be a society.
…
I believe that by shining a bright light on aspects of the debt crisis which are not adequately covered in other MSM outlets, Lewis has provided a valuable contribution to our understanding. I’m not much of a fan of his eagerness to assume actions by major investment banks were legal, though; as he points out, if the deal Goldman Sachs made with the Greek government were done in the private sector, it would be a crime. How does the fact the deal was made with a sovereign entity change that characterization?
P.S. I find it pretty amusing that he wrote this as a citizen of Berserkeley.
Over the past decade the city of San Jose had repeatedly caved to the demands of its public-safety unions. In practice this meant that when the police or fire department of any neighboring city struck a better deal for itself, it became a fresh argument for improving the pay of San Jose police and fire. The effect was to make the sweetest deal cut by public-safety workers with any city in Northern California the starting point for the next round of negotiations for every other city. The departments also used each other to score debating points. For instance, back in 2002, the San Jose police union cut a three-year deal that raised police officers’ pay by 18 percent over the contract. Soon afterward, the San Jose firefighters cut a better deal for themselves, including a pay raise of more than 23 percent. The police felt robbed and complained mightily until the city council crafted a deal that handed them 5 percent more premium pay in exchange for training to fight terrorists. “We got famous for our anti-terrorist-training pay,” explains one city official. Eventually the anti-terrorist-training premium pay stopped; the police just kept the extra pay, with benefits. “Our police and firefighters will earn more in retirement than they did when they were working,” says Reed. “There used to be an argument that you have to give us money or we can’t afford to live in the city. Now the more you pay them the less likely they are to live in the city, because they can afford to leave. It’s staggering. When did we go from giving people sick leave to letting them accumulate it and cash it in for hundreds of thousands of dollars when they are done working? There’s a corruption here. It’s not just a financial corruption. It’s a corruption of the attitude of public service.”
In his negotiations with the unions, the mayor has gotten nowhere. “I understand the police and firefighters,” he says. “They think, We’re the most important, and everyone else goes [gets fired] first.” The police union recently suggested to the mayor that he close the libraries for the other four days. “We looked into that,” Reed says. “If you close the libraries an extra day you pay for 20 or 30 cops.” Adding 20 more police officers for a year wouldn’t solve anything. The cops who were spared this year would be axed next, in response to the soaring costs of the pensions of city workers who already had retired.
It is a great article. It should be required reading for all who post here and/or those that live in cities/states approaching bankruptcy…
It would be even better without the italics. Why not just link to the original article?
he’s just showing off his html tags
I’ve already made plenty of apologies here for my abysmal legal ignorance, but at the risk of once again seeming pretty dense, why is the law different if a scam involves a sovereign government? I’m sure the German folk who are going to be left holding the bailout bag would be highly interested in the answer.
How The Financial Crisis Created A ‘New Third World’
Fresh Air from WHYY
After adopting the euro, Greece borrowed huge sums of money. The country is now on the brink of a major default. “They’re going to default … it’s now a question of how messy it will be,” says writer Michael Lewis. His new book Boomerang looks at Greece and four other places affected by the financial crisis.
October 4, 2011
Hedge fund manager Kyle Bass had made a fortune betting against the subprime mortgage market when it collapsed in 2008. And now Bass is set to make lots more — from a Greek default.
…
On Tuesday’s Fresh Air, Lewis looks at some of the institutions and individuals involved in the financial crisis in places like Greece, Ireland and Iceland — to determine what went wrong and who was involved in the current debt crisis.
In Greece, he says, the government initially disguised the true state of its finances with the help of U.S. bankers. Goldman Sachs, for example, did off-market currency trades with the government of Greece.
“[Those trades] enabled the Greek government to book upfront a big profit, but down the road [the Greek government] would have to repay Goldman Sachs quite a bit,” Lewis says. “So [Goldman Sachs] lent the government money without saying that’s what they were doing. If you did this in the corporate world, a bunch of people would be put in jail. They helped the Greek government rig its books so that they looked acceptable to the European Union so they’d be admitted to the euro[zone].”
…
… And Italy starts getting into the act. From my sense, Italy is going to be as ineffectual as Greece in dealing with its debt. Dow 10K here we come! (but not in the direction we wanted. But hey, there should still be celebrations anyway, it is Dow 10K after all
Italy’s sovereign debt rating has been cut for the second time in as many weeks, with ratings agency Moody’s citing “sustained and non-cyclical erosion of confidence” as it slashed its forecast for the country.
In a report released after US stock markets closed on Tuesday, Moody’s downgraded Italy’s government bond ratings from Aa2 to A2 with a “negative outlook”, suggesting further cuts could be to come. The move threatens to increase Italy’s cost of borrowing, and will add yet more pressure to European finance ministers now wrestling with a financial crisis that has spread across the continent.
http://www.guardian.co.uk/business/2011/oct/04/italy-downgrade-moodys-debt-crisis
From “We are the 99%”
The Middle Class is Too Big To Fail
I’m thinking of doing a poster that says:
We The People
Too Big to Fail
2banana, I think you should red this article.
“…it’s as if the brains of depressed people hate incorrectly. The brain disruptions the researchers observed could be a sign that people with depression have an impaired ability to cope with — and learn from — social situations in which they feel hate.”
http://www.cnn.com/2011/10/04/health/depressed-brains-hate-differently/index.html
Anyone who disagrees with a liberal is a “hater”,”racist”, wants to make
grandma eat dog food, wants to starve the children etc.,etc,etc. get some new lines, the old playbook isn’t working anymore.
2banana and unc, I think you should red this article.
“…it’s as if the brains of depressed people hate incorrectly. The brain disruptions the researchers observed could be a sign that people with depression have an impaired ability to cope with — and learn from — social situations in which they feel hate.”
http://www.cnn.com/2011/10/04/health/depressed-brains-hate-differently/index.html
‘Anyone who disagrees with a liberal is a “hater”,”racist”,…’
You catch on quickly!
Why don’t these Wall Street picketers add Wallmart, Costco, etc to their places ?
Maybe we could get rid of Chindia junk.
Did anybody see John King Live tonite with all the indsutrial espionage being done by Chindia?
“Why don’t these Wall Street picketers add Wallmart, Costco, etc to their places ?”
That’s a distraction. Those are symptoms, not the main problem.
Keep the focus on the crooked financial system that is Wall Street. Don’t get distracted or get co-opted.
Real estate agent squatted in Laguna Beach home, client alleges
October 4, 2011 | 11:01 am
A Laguna Beach homeowner reported to police that she believed her real estate agent was squatting in her vacant home while the sale closed.
The woman reported on Sept. 25 that she and the Realtor who had helped her sell her Loretta Street home had a “falling out” during escrow, according to Laguna Beach Police Lt. Jason Kravetz.
She could not fire the real estate agent because she was contractually obligated to continue with the sale, Kravetz said.
The woman reported that documents that required her approval had forged signatures on them. After noticing this, she went to her home to retrieve a key from the lockbox, Kravetz said. It was when she arrived that she noticed that cable and gas were set up for the home, indicating someone was staying there.
She reported that she saw her real estate agent’s desk and chairs inside her home, indicating he may have been using her home as an office.
Detectives are investigating, Kravetz told the Coastline Pilot. Charges have not been filed.
http://latimesblogs.latimes.com/lanow/2011/10/real-estate-agent-squatted-client-home.html - -
Principal reduction plan for struggling homeowners could be part of settlement between lenders and states
By Kimberly Miller Palm Beach Post Staff Writer
Updated: 5:45 a.m. Wednesday, Oct. 5, 2011
Posted: 7:43 p.m. Tuesday, Oct. 4, 2011
Florida homeowners facing foreclosure could see their debt reduced by banks under a proposal being negotiated this week by state attorneys general.
In return for cutting loan balances, banks would pay less in penalties for foreclosure and mortgage-related wrongdoing.
The principal reduction plan, which is being discussed as part of a settlement agreement between lenders and states, would accompany a second program that would provide funding to states to pay for their own foreclosure-rescue activity.
The possibility of banks lowering loan amounts was revealed today in the wake of the abrupt resignation of California Attorney General Kamala Harris from the core team of attorneys general negotiating the settlement.
Harris was one of eight attorneys general, including Florida’s Pam Bondi, on the team. She said Friday she was cutting ties with the group because the proposal doesn’t go far enough to help homeowners or punish lenders.
“It became clear to me that California was being asked for a broader release of claims than we can accept and to excuse conduct that has not been adequately investigated,” Harris wrote in a letter to Iowa Attorney General Tom Miller, who is leading the attorneys general group. “In return for this broad release of claims, the relief contemplated would allow too few California homeowners to stay in their homes.”
Despite Harris’ concern about banks being released from claims, Geoff Greenwood, a spokesman for Miller, said there is no discussion of giving banks immunity from prosecution.
And while details of the proposal are mostly secret, Greenwood did discuss the possibility of the national and state funds.
“Our settlement will provide huge benefits - estimated in the tens of billions of dollars - for borrowers,” Washington Attorney General Rob McKenna said today . “The deal we are negotiating will not give banks a get out of jail free card.”
In March, Bondi said she was opposed to principal reductions for homeowners, saying it was unfair to people paying their mortgages and could create a “moral hazard” that would lead others to default.
Meanwhile, Florida homeowner advocates question Bondi’s resolve to hold banks accountable.
“We expect continued disappointment from Florida Attorney General Bondi who continues her allegiance to the banks and their lawyers,” said West Palm Beach resident Lisa Epstein, who founded the blog ForeclosureHamlet.org.
http://www.palmbeachpost.com/money/foreclosures/principal-reduction-plan-for-struggling-homeowners-could-be-1895761.html - -
“Each month, Epstein draws a small crowd to her Foreclosure Hamlet happy hour at E.R. Bradley’s Saloon.”
Drinks are on me cause I live for free.
‘Deadbeat’ fights back against foreclosure process
By Kimberly Miller Palm Beach Post Staff Writer
Posted: 9:14 p.m. Tuesday, Oct. 19, 2010
WEST PALM BEACH — This deadbeat took on Wall Street, and Wall Street was cowed.
Lisa Epstein, a 45-year-old cancer nurse, mother to a 3-year-old girl, and prolific blogger, has spent the past year growing a grass-roots foreclosure-fighting coalition that is partly credited with forcing the nation’s largest banks to take a step back and review their home repossession machines.
She got tangled in the system herself when she was served with foreclosure papers last year, lost her top credit rating and was slapped with the deadbeat label.
But along with fellow local blogger Michael Redman, 35, Epstein fought the machine. The duo have combed through Palm Beach County court records; posted suspicious foreclosure affidavits online; written to judges, politicians and attorneys; and attracted a rock-star-like following of thousands nationwide.
The mounting evidence found by the group of citizen investigators couldn’t be ignored, and by late September the nation’s colossal financial institutions were on the spot to explain and fix their faulty foreclosure efforts.
“We used to be the wacko fringe; now we’re cutting-edge,” Epstein said. “Finally, my questions are being asked by reporters and attorney generals nationwide.”
Each month, Epstein draws a small crowd to her Foreclosure Hamlet happy hour at E.R. Bradley’s Saloon.
Divorced, sick, laid-off or self-employed in an economy on the rocks, attendees gather for support and to share information, attracted by a feisty nurse in a cute pink scarf who refuses to surrender.
http://www.palmbeachpost.com/money/real-estate/deadbeat-fights-back-against-foreclosure-process-981385.html - 91k -
This “feisty nurse” needs another 4 years of living free!
Type: MTG
Date/Time: 3/2/2007 09:23:19
CFN: 20070104472
Book Type: O
Book/Page: 21468/1835
Pages: 19
Consideration: $313,490.00
Party 1: EPSTEIN LISA B
EPSTEIN ALAN
Party 2: MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC
DHI MORTGAGE COMPANY LTD
Legal: TERRACINA L228 L
Type: LP
Date/Time: 2/19/2009 08:54:46
CFN: 20090056608
Book Type: O
Book/Page: 23087/240
Pages: 1
Consideration: $0.00
Party 1: U S BANK NATIONAL ASSOCIATION TRUSTEE
J P MORGAN MORTGAGE TRUST
Party 2: EPSTEIN LISA B
EPSTEIN SPOUSE
EPSTEIN ALAN
TERRACINA HOMEOWNERS ASSOCIATION INC
Legal: TERRACINA JOHNSON PROPERTY PUD L228 L