Bits Bucket for October 17, 2011
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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OCCUPY WALL STREET
The press is trying to tie the more violent Roman and Greek riots to Occupy Wall Street since these dang gosh American protesters refuse to misbehave.
Not that I’m tied into what’s going on w/OWS but I’d imagine the austerity measures that are causing Europeans to riot is what they’re trying to head off.
Seems the “press” is trying to tie any and everything into the OWS protests except the actual reason for their existence.
Love the tired rhetoric–
“dirty hippies,” “unemployed trust fund babies,” “street rabble,” and my personal fave, “egged on by leftist professors and professional communist agitators.”
But the divide and conquer thing that’s always worked so well in the past seems not to be gaining the traction they’d anticipated this time, and I’m starting to hear rumblings from my TeaParty acquaintances about how they “sort of agree with these guys” about the corruption on Wall Street thing.
Guess that’s what happens when you try to pull that cr@p on educated techies with access to an international social network; they tend to outflank your bought-and-paid-for “press.”
The Tea Party folks and the OWS folks have, at root, the same complaints, the same issues.
When the branding and the labeling ensue a division takes place and the central issue becomes a right wing issue or a left wing issue, which is exactly what the PTB want to happen.
Lemmings all.
Its just like Coke vs. Pepsi.
+ infinity combo…+ infinity
“The Tea Party folks and the OWS folks have, at root, the same complaints, the same issues. ”
My read is that the OWS people would happily accept the Tea Partiers. It’s the Tea Partiers, or at least their leaders, who disparage OWS- you see it right here on the hbb, and you see it in the MSM, and you hear it on right wing talk radio.
The Tea Party crowd seem to be more obsessed with government spending and taxation, while the OWS appear to be more concerned with the lack of jobs and Wall St’s looting of the nation.
As someone who supported Tea Partiers early on, I can tell you that tea party coverage wasn’t that good either. Fundies, whities, old, greedy, and the most favorite of mine, racists!® . All of them in this blog as a matter of fact.
Like Colorado said the biggest mistake Tea Party made was only going after government. Had the tea partiers gone after both the government (including military) and WallStreet, OWS may not have to happen. I think the tea partiers realize that so they are doing all they can to discredit OWS with the help of usual suspects. In the same fashion, the dems trying to make OWS their cause to power while they had no problem villifying tea partiers. My prediction is the OWS will settle for a short term power gain just like the Tea party. Will it get Obama elected? That appears to be seen. But it’s a brilliant strategy on Dems part. When you can’t run on your own records, you must agitate!
Govt and Wall Street are one and the same aren’t they?
My read is that the OWS people would happily accept the Tea Partiers. It’s the Tea Partiers, or at least their leaders, who disparage OWS
I don’t know about “happily accept”…I’ve seem quite a bit of snarkiness on both sides among my friends. I do think most realize they have some common complaints, though. But yeah, the TP leaders…the same original hijackers of that movement are trying pretty hard to demonize OWS.
the TP leaders…the same original hijackers of that movement are trying pretty hard to demonize OWS.
Occupy Wall Street: GOP Is Making Similar Mistake As Democrats Did With Tea Party
http://www.mediaite.com/online/occupy-wall-street-gop-is-making-similar-mistake-as-democrats-did-with-tea-party/
…by ignoring the Tea Party — or in many cases, mocking it — until it was far too late, Democrats were ill-prepared to deal with the fallout that led to an unmerciful electoral defeat in the 2010 midterm elections.
…Occupy Wall Street may or may not be the liberal version of the Tea Party, either way we’ll probably know within the next year. But that’s far too late for the GOP to ignore them, or worse act as though they’ll only have 15 minutes of fame. Here’s a clue, GOP: If you’re still looking at your watch waiting for it to end, use that time wisely and get a strategy.
…The message is as clear as the implications: income inequality has gotten out of control and is untenable. It’s a progressive rallying cry that has tapped into something the Obama administration hasn’t been able to do since early 2009; namely, leverage the sense that people powered by little more than anger and a desire to change government can actually do it.
GOP Needs to Change Message
After all, what does the GOP have to lose by showing empathy for protesters, acknowledging income inequality (which is categorical, not fanciful), and lending their voice to implementing structural change? Most recently, House Majority Leader Eric Cantor (R-Va) did mention income inequality (for once) on Fox News, claiming that “Republicans are about income mobility, and that’s what we should be focused on to take care of the income disparities.”
Sure, Republicans can make a case for that. Will it be convincing? Probably not. Tax cuts can drop down like manna from heaven but that won’t nourish those who lack critical job skills and higher education.
I say yes.
Is GOP Stance On The Occupy Wall Street Movement A Mistake?
http://cmvlive.com/business/is-gop-stance-on-the-occupy-wall-street-movement-a-mistake
…Cain and the GOP is making a mistake. They are making a mistake because they are falling into the trap being laid by the media that these protesters are the ‘Tea Party of the Left’ and therefore anything they say is the opposite of what the GOP stands for. But the facts are that the OWS protesters want many of the things that republicans like Sarah Palin are behind. The OWS protesters main argument is over what Palin calls ‘crony capitalism’ and what the protesters are calling ‘corporate capitalism’. They are the same thing! Since they do share a common goal with Palin stance on crony capitalism, Herman Cain might have been wiser to do like Newt Gingrich did and try to court the OWS protesters to his side.
….Unfortunately, the rest of the GOP is ignoring the importance of the demographic makeup of the OWS movement. Instead of trying to garner the support of the Millennials in the OWS movement and bring them to their side, the GOP has all but abandoned trying to gain their support. Instead Eric Cantor has called the OWS protesters “growing mobs”
Instead Eric Cantor has called the OWS protesters “growing mobs”
I see your white repubican Eric Can’torwont rook move, I counter with my black democraptic bishop: AG Eric Holder
“Boss, whata we gonna do with these “dirty-hippie” commie’s? iffin’s they stick daisy’s in our gun barrels?…seems to be gettin’ serious, they’re playing Pink Floyd…”
i agree they are making a mistake.
I a fiscally conservative Liberal. I find I like Ron Paul’s ideas a lot more than the neo-cons and Bush supporters. Just dont trash my planet.
Yeah, it’s funny how now the politicians are “sympethetic” to the cause all of sudden- they are trying like heck to divert the upcoming attention from themselves, and I thing the press is scared to death the protesters are going to finally put two and two together( and figure out the Establishment Media is not their friend either), and come to D.C., where the Wall St. enablers reside! Right now, they are still a little unorganized, and the PTB are trying like heck to fractionalize them and dilute their power, but hopefully they can resist that and unify under the message of the corruption must end, not just on Wall St, but in Congress and the Senate as well!! I too “sort of agree with these guys” - I just hope they get the right people, and don’t stop with Wall St!!
“Guess that’s what happens when you try to pull that cr@p on educated techies”
Remember that the Vietnam war protests didn’t really get going until they started canceling student draft deferments and college enrollment was no longer a way to insure avoiding the draft.
Anti-war protests? Nah. They were anti-draft protests. And we had those even during the Civil War.
You can’t depend on the “press” for a take on anything that is this unorganized so far. They (the press) are pretty much making it up as they go. And I don’t criticize OWS for being unorganized - I think it forces people to think about the many and varied things that the people who are down there are complaining about. Much better than becoming well-defined and irrelevant in next minute.
My brother and sister-in-law brought the kids down to see the protest and hang out for a while. They immediately had microphones shoved in their faces (mostly foreign journalists) because they looked different than most of the people there. Someone looking for “another perspective” on the protesters. But is that the right way to get a feeling for what is actually being said by the protesters? Interviewing a middle aged couple with little kids who have ultra-secure jobs and no student loans left? Are they a little squeezed and worrying about the costs of raising their family while trying to save for retirement? Yes. Are they part of the 99%? Absolutely. Are they the right people to talk about the purpose of the protest? Maybe not.
Yep - just like the tea party…
———————————
New York’s Marxist epicenter
New York Post | 10/17/2011 | Charles Gasparino
The standard portrayal of the Wall Street protesters goes something like this: Ragtag group of unemployed young adults, venting often incoherent but overall legitimate populist outrage about economic inequality. But go down to the movement’s headquarters, as I did this past weekend, and you see something far different.
It’s not just that knowledge of their “oppressors” — the evil bankers — is pretty thin, or that many of them are clearly college kids with nothing better to do than embrace the radical chic of “a cause.” I found a unifying and increasingly coherent ideology emerging among the protesters, which at its core has less to do with the evils of the banking business and more about the evils of capitalism — and the need for a socialist revolution.
It’s not an overstatement to describe Zuccotti Park as New York’s Marxist epicenter. Flags with the iconic face of the Marxist revolutionary Che Guevara are everywhere; the only American flag I saw was hanging upside down. The “occupiers” openly refer to each other as “comrade,” and just about every piece of literature on offer (free or for sale) advocated socialism in the Marxist tradition as a cure-all for the inequalities of the American economic system.
New York’s Marxist epicenter
New York Post | 10/17/2011 | Charles Gasparino (Charles Gasparino is a senior correspondent for the Fox Business Network) wiki
I don’t think “Marxist” means what FOX New’s Charles Gasparino thinks it means. At least most Americans don’t.
OWS - More Popular than the Tea Party - WOW
http://my.auburnjournal.com/detail/190490.html
What is it with the Tea Party? From it’s height in 2010 it sure has fallen far and fast in the minds of many Americans. Now a poll out today from Time magazine “revealed that respondents have a better impression of the left-leaning protest movement known as Occupy Wall Street than they do of the Tea Party movement. 54 percent of respondents harbor a positive view of the burgeoning protest movement,…By contrast, just 27% of those surveyed have favorable views of the Tea Party, while 65% say its impact on U.S. politics since its inception in 2009 has been negative or negligible.”
Wow. First we learned that the Tea Party is less popular than Muslims and atheists. Now we find that the Tea Party is less popular than that bunch of “free roaming viral parasites” who are protesting on Wall Street and elsewhere across the country.
But wait, there’s more!
1. Time Magazine - now there is a balanced source of info. Please tell me you have not put your faith into polls by Time Magazine.
2. Just wait until OWS actually starts to demand specific changes in government.
3. Not one protest in front of the White House. Yeah – they are just some cuddly feel good protesters…
Being to left of Castro will tend to lose you some support. By the end of the day - OWS will win NOT one election or change one law.
But wait, there’s more!
Today - Obama just threw his support behind OWS! Right behind the public unions.
Don’t touch my government cheese.
The OWS crowd seems to have three roughly equivalent foci as far as I can tell:
(1) Legitimate and well-thought out criticism of the bankster-government revolving door and the mortgage mess. Can’t disagree with that. Wish we could strengthen this element and de-emphasize:
(2) Those who are upset at having bought at the top of the college education bubble. Not many of these people seem to want to tell us -what- their degrees are in. Somehow I don’t think petroleum or nuclear engineering are well represented among the “we are the 99%” crowd.
(3) The residue, which seems to be a dog’s breakfast of those causes popular with those who missed the last bus out of the sixties. At least no one yet seems to have mentioned the Palestinians, or Mumia.
Not one protest in front of the White House.
You’re just saying that because Herman Cain is saying that today. And it’s wrong. They have protested in front of the White House. Here’s a picture. Scroll a little down the page:
Caption: Spread: Participants march with signs past the White House to the U.S. Chamber of Commerce during an “Occupation of Washington” protest in Washington
http://www.dailymail.co.uk/news/article-2046029/Occupy-Wall-Street-NYPD-officer-caught-bragging-beating-protesters.html#ixzz1b4NruKpb
Time Magazine - now there is a balanced source of info. Please tell me you have not put your faith into polls by Time Magazine.
Time is balanced enough to conduct a meaningful poll- especially compared to FOX. Why would a Time-Warner company want to paint OWS in a more favorable light than they actually are? And most of the media is not left when you compare its coverage to what most Americans feel. What you have to realize is that America, as a whole, is much more “left” in things that matter than our government is.
And I’ll back this up because that’s what I like to do. For example, most Americans wanted the public option in health care but we did not get it. In the least, we wanted to be able to buy into medicare but we did not get it.
Most Americans want Soc Sec and Medicare to be shored up and remain viable but many in our Government want to dismantle it.
If you google Mother Jones income inequality you will see that Americans want a much more even distribution of wealth than we have now and that most Americans are actually unaware of the gross wealth inequality that we do have in America.
Most Americans are against the wars and would have not been for the Iraq war if we weren’t lied to about it.
Most Americans are against crony, TBTF capitalism and most Americans are against the Citizens United SCOTUS ruling giving corporations unlimited campaign financing.
Most Americans want higher paying jobs and decent benefits way more than they want to see corporate profits increase.
Most Americans would have rather seen a Main Street Bailout than a Wall Street bailout.
Now these are major points which illustrate the point that the MSM is not really that “left” when compared to what most Americans value. And Americas are much more “left” than their “right” leaning, bought and paid for government.
If you still doubt the Time poll I’d like to remind you that the Wall Street Journal (same owners as FOX) and the conservative Rasmussen poll showed OWS having greater support than the Tea Party as well.
By the end of the day - OWS will win NOT one election or change one law.
Maybe, but I really doubt it. If played right, this could give Obama the election. What has happened now in America is the narrative on very important subjects has changed.
I cannot stress this enough. OWS is looking to be a game-changer. The narrative has markedly changed.
Once concerned about these “growing mobs,” House Majority Eric Cantor (R-VA) is making an about-face. Today on Fox News Sunday, he told host Chris Wallace that the president and Republicans “agree that there is too much income disparity in this country.” dallasnews dot com
You want to see desperation?
Nazis AND commies?
Read the comments.
http://news.yahoo.com/why-nazis-communists-occupy-wall-street-191900304.html
Time has celebrated the likes of Fidel Castro by honoring
him on their cover.
And Newsweek recently declared on their cover that “We are
all socialists now”.
Time has celebrated the likes of Fidel Castro by honoring
him on their cover.
Honored? You do realize most people here have brains? This 1965 TIME story and Castro cover was about the failure of communism, not its promotion.
Time Magazine Fidel Castro cover Oct 8, 1965
Caption: Cuba: The Decaying Revolution
http://www.time.com/time/covers/0,16641,19651008,00.html
A Letter From The (TIME Magazine) Publisher: Oct. 8, 1965
TIME editors have been considering a cover story on Fidel Castro in the seventh year of his rule. Last week, as he delivered a strange harangue to his people that unintentionally revealed a lot about Red Cuba’s trouble, the time seemed right to take another look at the frenetic dictator and his simmering island. Castro’s speech, incidentally, included a derisive reading in its entirety of a TIME, Sept. 10, story about Cuba entitled “Talk of Growing Unrest.”
….(Cuba’s sponser) The Russians predictably denied that they were edging toward that horrid condition of affairs called capitalism, and Liberman himself fired off a two-page cable (TIME LETTERS, March 5), spelling out his views.
Since then, the Soviet economic reform, marking the ideological bankruptcy of old-line Marxism, has become one of the most fascinating stories for Western journalists.
http://www.time.com/time/magazine/article/0,9171,842157,00.html#ixzz1b4fXXdN4
(This TIME story could have come right out of the conservative National Review)
And Newsweek recently declared on their cover that “We are all socialists now”.
And Playboy once declared on its cover:
“The Best of the West: PAC 10 Coeds Part II”
Don’t confuse him with the facts Rio, his brain might explode.
It’s not an overstatement to describe Zuccotti Park as New York’s Marxist epicenter.
LOL! I guess calling them hippies didn’t scare the masses, so now they’re commies. I guess if that doesn’t work they can accuse them of being child molesters or people who don’t like the NFL or something like that.
I guess calling them hippies didn’t scare the masses, so now they’re commies. I guess if that doesn’t work they can accuse them of being child molesters or people who don’t like the NFL or something like that.
That’s funny but I’ve noticed this trend. The Limbaugh/Beck crowed started with calling people “liberals” in snide ways then “collectivists” and “progressives” then those lost their shock value so they switched to “socialists”. Well that had a good one year run then people began to yawn so they switched to “communists”.
I think they are pulling out the “commie/marxist” card too soon because by 2012 people will be yawning at that label too.
The lion in winter cover Feb 1995. But I don’t have to stick up
for a communist.
President Wilson was the “progressive”, but that term was later
changed to “liberal” when it developed a negative connotation.
The lion in winter cover Feb 1995.
You should stop. Castro sucks but it’s called news. TIME was not “honoring” Castro as you described. The article was much about how Cuba was finally recognizing their need to become more market oriented. Here are the opening words of the Castro TIME cover story Feb 1995. I’ve never heard of describing a leaders economy as a FAILURE as an “honor” before.
As the failure of its economy forces Cuba to reinvent itself, Fidel Castro has stayed largely in the background, leaving it to other officials to explain and defend the changes sweeping his country.
…TIME: How do you really feel about foreign investment in Cuba?
Castro: I was among those who proposed joint ventures even before the collapse of the Soviet Union because we had resources that we could not make use of. We have factories that need raw materials, such as fuel, or some more updated technologies so we may accept a joint venture. The principle we base our activities on is that to develop the country needs capital, technology and markets. All these investments and joint ventures are fundamentally aimed at export production.
http://www.time.com/time/magazine/article/0,9171,982545,00.html#ixzz1b50TfAk3
Don’t you think they could have put someone better on their
cover? You can’t deny the statement on the cover of Newsweek, a competitor to Time.
Don’t you think they could have put someone better on their cover?
Perhaps. But the cover story did not amount to an honor. And part of their goals with these covers is to sell magazines which is pretty capitalistic.
You can’t deny the statement on the cover of Newsweek, a competitor to Time.
I read that article too. Part of what it talked about in “We’re All Socialists Now” was the socialization of the bank’s and the rich’s losses. Another part was about Soc Sec and Medicare both of which are not technically “entitlements” and therefore not actually “socialism” imo. But again, the cover probably sold a lot of magazines as well as pissed some people off.
Oh those pesky facts.
Yeah.
I would not be surprised to see conservatives try to sabotage the OWS efforts with plants breaking the law and complaining to be OWS.
Surprising? I fully expect it.
Conspiracies theories before anything even happens?
You guys getting a little paranoid?
Agent provacatuers are as old as history and are on the first page of the discreditation playbook.
So far, the OWS has managed to spot and weed them out, turning in trouble makers to the cops themselves.
So far, the OWS has managed to spot and weed them out, turning in trouble makers to the cops themselves.
I can’t wait to see what the PTB will try next.
I figure the OWS is against Wall St welfare and the Tea Party is against human welfare. Both want the handouts to stop.
The conservatives are too busy working to feed their families and
the govt. beast than to waste their time with the OWS crowd.
‘The conservatives are too busy working to feed…the govt. beast than to waste their time with the OWS crowd’
Yeah, well…
I’m commenting in reference to Avocados’ statement about
“plants” put into the situation by conservatives.
Occupy Iraq
Wow, has the Yell/Scream/Holler’s of “Where’s lil’ Opie’s birth certificate!” really lost their
angervoice.“heheeheeeheehe…”
U.S. abandons plans to keep troops in Iraq:
AP News LARA JAKES and REBECCA SANTANA - Associated Press | AP – Sun, Oct 16, 2011
But a senior Obama administration official in Washington confirmed Saturday that all American troops will leave Iraq except for about 160 active-duty soldiers attached to the U.S. Embassy.
BAGHDAD (AP) — The U.S. is abandoning plans to keep U.S. troops in Iraq past a year-end withdrawal deadline, The Associated Press has learned. The decision to pull out fully by January will effectively end more than eight years of U.S. involvement in the Iraq war
The Strategic Framework Agreement allows for other forms of military cooperation besides U.S. troops on the ground.
About 5,000 security contractors and personnel will be tasked with helping protect American diplomats and facilities around the country, the State Department has said.
The U.S. Embassy will still have a handful of U.S. Marines for protection and 157 U.S. military personnel in charge of facilitating weapons sales to Iraq. Those are standard functions at most American embassies around the world and would be considered part of the regular embassy staff.
When the 2008 agreement requiring all U.S. forces leave Iraq was passed, many U.S. officials assumed it would inevitably be renegotiated so that American forces could stay longer.
Who knew Bush was so visionary.
Don’t worry Obama is doing his best. I heard Uganda is the new promise land.
I heard Uganda is the new promise land.
Is it true Cheney-$hrub found evidence of Iraqi WMD “yellow-cake” in Africa? Eyes in “$hock-n-Awe!”
The 99% ground rodents here at the 10K Ranch and Nerd Sanctuary tried to stage an occupation this weekend, but, libation in hand, I sent in my kittycat-goon squad to break it up. Carnage!
Leeches, I tell you. Do nothing but sully my grain stores, chew up my patio furniture, and spread contagion. Why, last week I found a whole family of them camped out in my Hermes saddle pads. Harrumph. I don’t know who they think they are anyway….
Harris! More champagne!
Did you try pepper spray and billy-clubs? They seem to have a somewhat temporary if limited effect.
FYI - someone has spray painted “goon squad” over the westbound lanes of I-90 just east of Rockford, IL. Just an obs from a leaf peeping trip this weekend.
There hasn’t been much legible tagging in these parts since the 70s.
In Illinois? Must be those union goons and thugs with guns that we hear about from a certain poster on the HBB
GO GOONS GO!
Jim poorman trenton: the voice of OWS
http://www.gcnlive.com Home of alex jones the poorman is on M-F 10pm 1am Eastern
http://www.facebook.com/#!/profile.php?id=636745413
He was a big DJ in the 80’s for KROQ out of LA.
I’ve gone down to the Norfolk occupy. I’m supposed to help get them electricity and an internet stream. Only 1 or 2 of the people don’t have jobs. Most are pretty normal, with a few hippies doing rock peace signs and crap.
Was thinking about camping over one night, JUST to say I did it.
Was also thinking about trying to inject some “Affordable Housing” type protest into it.
Keep us posted, Ethan? And don’t be afraid to start to housing convo.
Will do!
#occupywhitehouse2013
http://news.yahoo.com/china-makes-secret-eurozone-commitment-155623735.html
China made a “secret commitment” to prop up the euro in return for budget reform and public sector cuts and to purchase infrastructure assets.
So, why is China doing this? (choose one):
1. Because the Chinese is ruled by wonderful, caring, benevolent, good-hearted people who want to help out the Western World in their hour of need.
2. Because they can. Europe sold themselves out to China one euro at a time and now China is in the process of collecting the goods.
Cash is king.
“the Chineese is ruled” = “China is ruled”
Europe isn’t the only country to have sold itself out to China. The U.S. did the same, one dollar at a time, one job at a time.
Okay, Europe is a collection of countries, not a country. But I hope you get my point.
The Eurozone is the largest marketplace on the planet. Double the size of North America.
It’s why so many people are trying to destroy it.
Most favored nation trading status and membership in the WTO were pretty big leaps. Not all of it was one job at a time. There are points in time where something could have been done.
I don’t get the politicians who think somehow or at least behave as if other people (whether US investment bankers or Chinese diplomats) will act for the larger good. It doesn’t happen. If you don’t refuse to bail out the banks until they agree to major reforms, you aren’t going to get major reforms. Not even if they say stuff like “We recognize the seriousness of the situation” while in the room. The era of doing what is right for the country because you recognize that a properous country is the only way to make a buck tomorrow is over.
And with diplomacy with other countries? Why does anyone trust anyone else? “Trust but verify” is a crock. It really translates to “go forward but don’t trust.” The only way is to be totally dependent on each other. The US and Canada barely have that level of trust. US and China? Nope. US and Pakistan? Nope. I could go on.
Polly
Working in various industries every day, most of whom depend on cross border (Canusa) trade - I would say that Canada and the USA have that mutual dependency.
We certainly trust your companies to keep their word, and they have for many many years. Hopefully we have too.
But, in my limited experience, the business culture in Canada doesn’t quite “get” the government culture in the US. It is a small thing and can be solved by listening to your foreign legal counsel, but it is there. It has some effect on the dialog. And there are certain ethical issues that come up with each implementation of capitalism that are not common. I gave a Canadian retired doctor the link to the Gawande New Yorker article about health care costs and he was appalled. He said that a doctor owning a profits interest in a lab that did medical testing that the doc might order was about the most unethical thing he could think of. Here it is expected.
I believe Canada is dependent on their relationship with the US even though the EU is Canada’s largest trade partner now, isn’t it? And I think some parts of the US are similarly dependent on Canada, though not all. That plus a huge common border gets us to that level of trust. We need each other too much to do anything else. I’m not sure I would say that the US has that relationship with any other country in the world.
Oh, and just to clarify, I am talking about politicians/diplomats here, not individual companies. That is an entirely different discussion.
Polly
Our biggest trading partner is the good ole USA, and we are also your biggest trading partner - by a mile. We are also your biggest supplier of crude oil, uranium, electric power, natural gas, automotive, etc. I would imagine that Canadians are your biggest source of vacationers.
“But, in my limited experience, the business culture in Canada doesn’t quite “get” the government culture in the US. It is a small thing and can be solved by listening to your foreign legal counsel, but it is there. It has some effect on the dialog.”
I have never thought of this before but I believe you are right. We tend to be a little too “oh gosh” -”they will see what we mean” - when in reality good counsel will anticipate that minor breach and fill it for us. I have seen this done. Often. I think they are just being polite in not pointing it out to us.
There is a map in the Canadian embassy in DC that is a hoot. It shows all the imports/exports between the US and Canada by Canadian provice/territory. Everything except Ontario is a large trade suprplus for Canada and Ontario is about even. Or that is what I remember. I saw it in the spring and did not memorize. Then went down to see very cool film about a research vessel going through the Northwest Passage - in October.
I worked on a litigation for a Canadian Bank back in private practice. They could not understand why they were being denied a tax credit when they had clearly fulfilled everything required by the spirit of the law and very arguably had fulfilled everything required by the letter of the law. They were very confused. And I once told some friends they really needed their own lawyer to sell undeveloped property in the US. They didn’t believe me that the contract might be written so that they would be responsible if the land turned out not to be suitable for building, or any number of other things. That kind of basic belief that stuff should be fair runs deep. It can change, but it doesn’t change quickly.
3. China has a bunch of presidential portraits that don’t age well and would like to convert them to hard (infrastructure) assets.
3. The King is stupid. China has been on a spending spree while their people have participated in an immense credit/real estate bubble. Just like Japan did.
The recent video on Youtube by Yoram Bauman is well worth a watch—pretty amazing stuff. He showed the number of spanky-new high-rises near where he was staying that were all completely empty. It was truly remarkable.
Yeah, this will end well…
China is trying to save their customers to keep the mercantile economic system going. Same stupid reason Germany is pumping in money to save the PIIGS.
First my customers by stuff in my store for credit they obtained from a thrid party. Eventually my customers run out of greater fools that will extend credit to them. To keep the spending spree going I give them money so they can keep on shopping in my store. This is not a long term viable economic model, but it will buy some time.
Alternatively my customers go bankrupt which is not particularly good from me trying to sell my stuff.
Corollary: Running huge trade imbalances over larger periods of time will never have a happy ending.
If you run a trade surplus you are exporting wealth created by your people against some vague promises (debt) to pay you back in the future. The future has arrived and the promises past are vanishing into thin air. China and Germany are in the process of learning a very expensive lesson in international trade.
China has a lot to lose if the US or Europe stops buying their crap.
Governments are not voted out in China, they are run out.
Sure, same is true from Germany. But extending credit to your customers which can never be paid back is the same as giving away you goods, or at minimum selling them for a huge discount. This is not a viable long term economic strategy but it does buy time. Very expensive time without changing the ultimate outcome.
One difference between the Germans and the Chinese, the Germans don’t make junk that’s sold at WalMart. They make stuff for which customers are willing to pay a stiff premium.
Of course, if your customers are broke it won’t make any difference.
“…extending credit to your customers which can never be paid back is the same as giving away you goods, or at minimum selling them for a huge discount.”
Actually, extending credit to your customers that can never be paid back is more like extending credit to yourself (it turns those goods into dollar bills, they’re not given away) while insuring your customers take responsibility for it not being paid back. The discount will only ensue if you don’t extend credit to those who can’t purchase at the set price.
Viability in the long run is, apparently, no longer and issue.
“Of course, if your customers are broke it won’t make any difference.”
“Broke” is a funny term when there are assets still to be obtained; for example, the Germans might want to buy up a good chunk of RE in Greece…
How many times they bring up this story? It’s false.
Since nothing got accomplished over the weekend, it’s a secret rumor so that the mr. market goes up this week. That’s their MO.
Foreclosures Empty Homes, and Criminals Fill Them
By MICHAEL WILSON
Published: October 14, 2011
The boarded-up homes that changed the face of Jamaica, Queens, in recent years were bad enough, the flotsam of the record wave of housing foreclosures that roared through the streets like nowhere else in New York City.
But those vacant homes are now recalled almost fondly. For nature, as the saying goes, abhors a vacuum, and so do criminals. The police and neighbors say those vacant homes are filling with drug dealers, addicts, prostitutes, gang members, squatters and copper thieves.
http://www.nytimes.com/2011/10/15/nyregion/foreclosures-empty-homes-and-criminals-fill-them-up.html - -
Dorothy
I don’t like this neighborhood! It’s - it’s dark and creepy!
Scarecrow
Of course, I don’t know, but I think it’ll get darker before it gets lighter.
Dorothy
Do - do you suppose we’ll meet any gang members?
Tin Man
Mmmm - we might.
Dorothy
Oh -
Scarecrow
Gang members that - that deal drugs?
Tin Man
A - some - but mostly prostitutes and addicts and thieves.
Dorothy
Prostitutes!
Scarecrow
And addicts!
Tin Man
And thieves!
Dorothy
Oh! Prostitutes, and addicts and thieves! Oh, - my -
Dorothy, Scarecrow, Tin Man
Prostitutes and addicts and thieves!
Dorothy
Oh My!
Scarecrow!
Oh, look!
Dorothy
Oh!
Prostitute
Hey Straw man, you lookin` for a date?
What about you Shiny?
“Hookers” works better with the metre.
More coffee for that man!
“Hookers” works better with the metre.”
You know I thought the same thing right after I clicked Add comment. Well you know what they say…. It takes a village to deflate a bubble. I will now look up the word metre and then I have to go to work.
ahansen
You are good.
metre2 US, meter [ˈmiːtə]
n
1. (Literature / Poetry) Prosody the rhythmic arrangement of syllables in verse, usually according to the number and kind of feet in a line
2. (Music, other) Music another word (esp US) for time [22]
Hookers and junkies and thieves, oh my!
These problems are easily resolved: Pass a law requiring vacant homes be put on the MLS within, say, one month of when they go vacant. The homes will end up in the hands of a new owner of record within a reasonable period of time, rather than decaying into a state of dilapidation or falling into the hands of criminals.
Squatters allegedly operated brothel out of Las Vegas house
Page Last Updated: Wednesday May 18, 2011 3:23pm PDT
Gerard Ramalho reporting
There is new evidence of a growing problem in Las Vegas: squatters moving into vacant homes.
In this latest case, the homeowner says squatters moved in and were allegedly operating a house of prostitution.
The home is near Buffalo and Mountain’s Edge Parkway. The owner recently returned to the house from California.
The homeowner compiled all of the belongings that were in the house and placed them in the front yard. It’s lucky for the homeowner that the occupants weren’t home when he arrived, because police likely would have been powerless to remove them.
Under federal law, if an occupant provides a lease, only a court can determine if it is valid.
“This was a completely beautiful home with no evidence of anybody living here, but as you can see they’ve taken their personal belongings, laid them here. No furniture, just bags of clothing,” said homeowner Ferrell Ostrow.
Ostrow is just now realizing what many Nevada homeowners have known for some time: just because you won a property doesn’t mean you have complete control.
“I’m told by the neighbors that this has been used as a brothel. [It’s] just horrible.”
Ostrow, who lives in California, recently purchased the Mountain’s Edge house with the intention of renting it out. It had been sitting empty. When his real estate agent came to view the property, that real estate agent says a woman answered the door and described herself as a madam.
The agent said the woman admitted the property was being used as a house of prostitution. Ostrow immediately called police. He says that’s when things got even more frustrating.
“In essence, you could go to the grocery store with your wife, come back, see that someone has entered your home, changed the locks. They have a fake lease and you have to fight to get your house back in court.”
…
What a crazy system we have.
Looks like occupation is 9/10 of the law.
But you can just never leave…(cue Hotel California)
———————————
The homeowner compiled all of the belongings that were in the house and placed them in the front yard. It’s lucky for the homeowner that the occupants weren’t home when he arrived, because police likely would have been powerless to remove them.
“In essence, you could go to the grocery store with your wife, come back, see that someone has entered your home, changed the locks. They have a fake lease and you have to fight to get your house back in court.”
Why shouldn’t this policy extend to, say, cars?
If you “abandon” your car in a store’s parking lot while you go shopping why should one be charged with a crime if he were to hotwire it and drive it away?
Somehow, I don’t think making it illegal to own empty buildings is going to fly. There are plenty of empty homes here listed at wishing prices, and they sit empty for years anyway.
If it were illegal for a bank to carry things on their books at mark to fantasy, that would encourage them to sell at market.
FYI, Jamaica Queens is far from Manhattan, almost in the suburbs. As areas close to the center get richer and richer, those further away get poorer. The second wave is even starting to hit the suburbs.
In most metro areas there is only one wave — an expanding area of decline radiating out from the center.
Jamaica Queens has been an economically challenged area for a long time.
Had a friend who worked at the main Queens library branch there in the 1980’s. The library is located about 3 or 4 blocks from a transportation hub of subways and commuter train station.
They had a shuttle bus to take them to the trains in the evening, as it was considered too dangerous to walk.
When talking about NYC nabes, the 80’s might as well be the dark ages. Areas can go through several cyles in that amount of time. They don’t have to, but they can.
To some extent, yes, but this is an area where I (middle aged, middle class, lily white woman) still get noticed when I walk down the street in the afternoon.
This area never got significantly better on the 90’s and 00’s as it is too far out to attract hipsters the way Bushwick and Bed Stuy have.
What about you Shiny?
“…need a little polish?”
Realtor Charged in $76 Million Ponzi Scheme
http://www.bloomberg.com/news/2011-02-25/new-mexico-realtor-charged-in-76-million-ponzi-scheme.html
OCCUPY RE/MAX
Vaughn spent all their money
he was cooler than Fonzie
but it wasn’t at all funny
when they busted this Ponzi
lmao. You’ve been on a roll for a week now. Well done.
“People who trusted Vaughan ended up losing a lot of money, in some cases, their life savings.”
Kinda put$ a little tarni$h on this self-adhe$ive motto, no?
Realtor$ are ProFEE$ional$!™ …or do you prefer the spicy new mexico spanish slang: Realtor$ are ProFleecenistia$!™?
You would think having millions of vacant houses eroding away would be a buffer to Lowes business. Canary in the coal mine?
http://www.marketwatch.com/story/lowes-closing-20-underperforming-stores-2011-10-17
Also note the scale back of new stores and fewer remodeled stores.
2000 jobs lost.
On a unrelated note, Citi-Bank beat estimates with earnings up 74%.
“You would think having millions of vacant houses eroding away would be a buffer to Lowes business.”
In normal times - times when people had MONEY to spend - it would be a buffer to business.
Blowes shut down store in Ticonderoga, NY last month. Imagine that. It was a farce they they actually built and opened one there.
The local Lowes is always a ghost town when I go in. The HD seems to be busier.
It wouldn’t hurt my feelings to see HomeCheapo implode. Then maybe the weekend wallys and goobers will finally figure out they can get better material for 30% less at supply houses.
I would point out Lowes leans to the upgrade and new home owner crowd while HD covers the fix up and major remodeling customer.
Lowes always seems a little more expensive than other places. Although their appliances are usually in line because folks do comparison shop that stuff.
I’ve noticed that I am not getting weekly circulars anymore from either Lowes or HD on a regular basis, but I get two every week from Menards (a regional competitor).
CitiBank is beating estimates now? Well, that’s a step up from beating women on the sidewalk at least.
Ground Hog Day for the EU Crisis
Germany Shoots Down ‘Dreams’of Swift Euro Crisis Solution
By Rainer Buergin and Tony Czuczka - Oct 17, 2011 4:06 AM PT
Germany said European Union leaders won’t provide the complete fix to the euro-area debt crisis that global policy makers are pushing for at an Oct. 23 summit.
German Chancellor Angela Merkel has made it clear that “dreams that are taking hold again now that with this package everything will be solved and everything will be over on Monday won’t be able to be fulfilled,” Steffen Seibert, Merkel’s chief spokesman, said at a briefing in Berlin today. The search for an end to the crisis “surely extends well into next year.”
…
This entire Dog and Pony show will end on the day France and Germany have their debt downgraded. This day is in the not too distant future. Up until then all kinds of promises, bailouts, backstops, rescue funds, bad banks etc. will be created just to prove useless a few days later followed by more weekend emergency meetings.
In this financial end time scenario countless trillions of capital are transferred from the citizens to the financial mafia.
It’s a confidence game.
It’s the era of putting the CON back into the economy.
Don’t you guys think it’s weird that the German Chancellor speaks such good English?
Nein. Sie ist sehr klug.
Are you trying to say that Angela’s statement was translated?
There has never been a worse time to invest.
Investing during a crisis
Nowhere to hide
Investors have had a dreadful time in the recent past. The immediate future looks pretty rotten, too
Oct 15th 2011 | from the print edition
PITY the world’s savers. Economists and other busybodies chide them for not spending more, thereby stimulating the economy. Meanwhile their pension schemes are steadily being made less generous, a process that will require them to save more, not less, if they want to enjoy a comfortable retirement. Britons now retiring on private pensions will receive an income 30% less than those who left work three years ago (see Buttonwood). When savers try to find a home for their money, they face daily headlines about bank bailouts, sovereign-debt crises and the possibility of another recession.
Given the scale of the risks, investors are not being offered much in the way of reward. In much of the developed world, yields on cash are 1.5% or below. The most liquid government bond markets (those of America, Britain, Germany and Japan) offer yields of 2.5% or less. In both cases, such meagre returns are part of a deliberate policy: governments and central banks want companies that might create jobs to start borrowing again. Even American equities, despite a dismal record over the past decade, offer a dividend yield of just 2.1%, a level that historically has been associated with low returns for several years to come (see article). That is a legacy of the stratospheric valuations attained by Wall Street at the height of the dotcom bubble.
The danger for savers is not simply of disappointing returns, but of devastating blows to their wealth. Just after the second world war, British government bonds (gilts) offered yields similar to today’s; those who bought them lost three-quarters of their money, in real terms, by 1974. Investors with more of an appetite for risk may do even worse. Those who bought Japanese shares at the peak in 1989 are now sitting on a nominal 80% loss.
…
How about Russia in 1917?
OK — you got me there. I was thinking of post-WWII America…
Russia in 1917 is a lot like Germany 1939. Your best investment is a ticket out.
Preferably with jewelry sewn into the lining of your clothes. Of course, that might be hard with airport security systems the way they are now….
Now you know the REAL reason for all that security.
Occupy Congress with integrity.
YESSSS!!!!
The undeniable fact that CONgress is bought and paid for by Wall Street, megabanks, and other wealthy special interest groups is the fault of:
A) Wall Street, megabanks, other special interests
B) The CONgresscritters themselves
C) The voters (us)
D) All of the above
C) The voters
The average voter must stop doing these two things:
1. My guy is still better than the rest.
2. Voting for the lesser of the two evils. Lesser of the evil is still evil.
2. Voting for the lesser of the two evils. Lesser of the evil is still evil.
Yes but it still the lesser of the evils. Isn’t it? I mean if you only have 2 choices, don’t you get less evil if you vote for the lessor of the evils?
And then you end up with less evil than the choice that is more evil I think.
Ahh, but does that 3rd party candidate turn evil once he/she gets thrown into the system? Or will just give up after trying to get things done the right way?
I don’t know the answer to that. But I can think of two case studies
1) Jesse ventua. ok, yeah, he’s a wrestler and maybe shouldn’t be governor of anything. But he tried thinking outside the box a bit, both parties pretty much ignored him, and he gave up.
2) Sen Peter Fitzgerald from IL. He was a Republican who essentially voted how he wanted to (including getting the no-relation fed attorney Peter Fitzgerald to come to Illinois and clean up some of the corruption mess we have), and ended up leaving after 6 years because the Republicans told him they wouldn’t support him in an re-electon campaign.
Ron Paul seems to be the exception to the rule, and it’s good that the people in his district have seen fit to keep re-electing him. I disagree with him on a bunch of issues but definitely give him props for integrity.
The Republican race
Rising Cain
Herman Cain is the latest challenger to Mitt Romney’s position as front-runner
Oct 15th 2011 | from the print edition
EVERY few weeks, the race for the Republican presidential nomination acquires a new leader, or at least a new challenger to Mitt Romney, the steadiest force in the field. First there was Donald Trump, a businessman-cum-impresario with a fascinating hairdo. In July Michele Bachmann, a shrill congresswoman, had a moment of ascendancy. August and September saw the rocket-like rise and fall of Rick Perry, the governor of Texas. At the beginning of this month all eyes were on Chris Christie, the wavering governor of New Jersey, who ultimately declined to run. The latest excitement, however, is perhaps the most unexpected of all: Herman Cain, a former pizza mogul and talk-show host.
A few polls, including our own Economist/YouGov one, show Mr Cain leading Mr Romney, with roughly 30% support. In most, though, he is nipping at Mr Romney’s heels. All this is a startling change from a month ago, when he rarely made it into double digits (see chart).
…
And still they refuse to acknowledge Ron Pauls existence - perhaps he should have been black? Maybe he can be Cains running mate, at least?
They won’t be ignoring him in NH, especially if he wins the primary.
He won the California straw poll and others, and I agree he doesn’t
get a lot of traction. I will be voting again for him as I did in 08.
The RNC will shut him out, even if he wins NH while they tout Cain as their answer to Obama.
If I were in Murdoch’s and the Koch brothers’ shoes- that is, if I were orchestrating the Republican primaries- I would keep Cain and Romney on reasonably friendly terms, so that eventually I could place Cain as Romney’s VP choice, and bring the Tea Party back into the corporate fold.
Kinda like when they sent Palin on her successful mission to bring the Tea Party back into the Republican/corporate mainstream.
At its base, there is a decent bit of agreement between the Tea Party and OWS, and the Tea Party (mis)leaders are doing everything they can to tamp that down and turn it around.
You see it in our local propagandists. You see it on the MSM.
Cain certainly has an interesting sense of humor!
October 17, 2011 8:45 AM
Herman Cain says his call for 20 foot electrified border fence was a joke
By Corbett B. Daly
Presidential contender Herman Cain was joking when he promised his administration would build a 20 foot electrified fence on the border with Mexico to keep out illegal immigrants.
At a pair of campaign stops in Tennessee on Saturday, Cain said the United States has an immigration crisis and he would be willing to put U.S. troops on the border in addition to the barbed-wire fence with a sign that says “it will kill you — warning,” the New York Times reported.
Asked about the comments Sunday on NBC’s Meet the Press, Cain said he was joking.
“That’s not a serious plan,” Cain told host David Gregory, “that’s a joke. I’ve also said America needs to get a sense of humor. That was a joke, OK?”
…
I watched a republican debate where Rick Perry sounded a bit frustrated trying to explain why a border wall isn’t realistic. How this idea ever caught on I don’t know, but it is pretty silly to think it could even be built, much less operational.
Still, Cains non-serious plan is funnier than the latest joke out of the White House.
Still, Cains non-serious plan is funnier than the latest joke out of the White House.
(Reuters) - An Iranian-born Texas man accused of an elaborate plot to kill the Saudi ambassador in Washington was a heavy drinker and flighty businessman who did not fit the profile of a cunning agent, according to people who knew him well.
Well, all Ronnie Raygun had do was simply follow his wife’s often repeated motto: “Just say no!”
“Wilson was notorious for his personal life, particularly drinking, cocaine use, and womanizing, and he picked up the nickname “Good Time Charlie”.
Charles “Charlie” Nesbitt Wilson (June 1, 1933 – February 10, 2010) was a United States naval officer and former 12-term Democratic United States Representative from the 2nd congressional district in Texas.
He was best known for leading Congress into supporting Operation Cyclone, the largest-ever Central Intelligence Agency (CIA) covert operation, which under the Reagan administration supplied military equipment, including anti-aircraft weapons such as Stinger antiaircraft missiles, and paramilitary officers from their Special Activities Division to the Afghan Mujahideen during the Soviet war in Afghanistan. His behind-the-scenes campaign was the subject of the non-fiction book Charlie Wilson’s War
“… who did not fit the profile of a cunning agent…”
Nor did Lee Harvey Oswald.
You don’t need a cunning agent, you just need a dupe to pull a trigger. Or strap a bomb onto his body.
Corpus Christi is not known for being a place were cunning agents lie low.
were cunning agents lie low.
Is near these two recent things?:
10′ water depth …Colombia submarines.
Want to stop illegal immigration?
Screw the fence. Start slapping some six and seven figure fines on companies and individuals that hire illegals.
Or let people sue the crap out of employers for “enabling” illegals to drive around drunk, and t-bone a bunch of high school honor students.
Better yet, pay the illegals 10% of the fines, if they narc out the people who hired them.
Iran is likely a smoke screen and a political ploy. Here is what will more likely happen: The Iraq war destroyed the standard of living of 10’s of millions of people in the Middle East. It is the nature of their culture to engage in revenge and one day they will hit us back. They will take their time and they will have multiple plots in play.
It will be blamed on who ever is in the WH at the time.
The real criminals are selling memoirs and opinions justifying the their crimes and trying to rewrite history.
Is a border wall that technically challenging though? They can design a 30 mile tunnel beneath the English Channel, the Chinese with primitive technology built a wall that 2300 years later still stands.
Politically challenging certainly, but not technically.
It’s environmentally challenging.
Yeah everybody thought Ron Paul’s comment in one of the debates about fences keep people IN as well as OUT was a joke. I’m not laughing.
Echoes of 2008
Here we go again
The Europeans are pushing the global banking system to the edge
Oct 8th 2011 | from the print edition
YOU know something bad is going to happen in a horror film when someone decides to take a late-night stroll in a forest. The equivalent in finance is a bank boss insisting that his institution is completely solid.
European bankers have been saying things are fine for weeks now, even as their exposure to indebted euro-zone countries strangles their access to funding. The amount of money parked at the European Central Bank (ECB) has risen to 15-month highs as banks hold back from lending to each other. Fears of contagion from Europe have now infected America (see article). Banks there led the S&P500 into official bear-market territory this week, as the index briefly dipped more than 20% below a high set in April. The chief executive of one embattled institution, Morgan Stanley, sent a memo to employees reassuring them that the bank’s balance-sheet was dramatically stronger than it was in 2008, when Lehman Brothers collapsed.
Europe is not the only problem facing Western banks, of course. A long list of woes also includes anaemic economic growth, piles of new regulation and waves of litigation related to America’s housing bust. An ill-conceived congressional bill to punish China for manipulating its currency is yet another sign that America has little to be proud of in terms of economic policy. But the central reason to worry is the euro zone: a series of defaults there would unleash devastation, sparking big losses on European banks’ government-bond holdings, and in turn threatening anyone exposed to those banks.
Earlier this year, the prospect of another Lehman moment seemed remote. Thanks to the abject failure of Europe’s leaders since then, the similarities with 2008 are disturbingly real. Governments are once again having to step in to support their banks. France and Belgium this week said that they would guarantee the debts of Dexia, a lender that was bailed out three years ago but which is weighed down by lots of peripheral euro-zone debt. In another throwback, plans are afoot to create a “bad bank” for Dexia’s worst assets. The cost of buying insurance against bank defaults has surged: credit-default-swap spreads for Morgan Stanley and Goldman Sachs hit their highest levels since October 2008 this week. Rumours are rife: that banks cannot pledge collateral at central banks, that hedge funds are pulling their money from prime brokers.
…
When in danger or in doubt, run in circles, scream and shout!
No money for street lights.
Plenty of money for insane public unions.
Welcome to the liberal utopia of Detroit.
——————————————
Detroit struggles to keep lights on
The Detroit News - October 17th, 2011
The growing lack of public lighting has become a troubling problem for cash-starved Detroit, where entire stretches of neighborhoods and thoroughfares — such as portions of the Southfield Freeway — are feeling the effects.
“This city…it’s dark without streetlights,” said Wicks, who lives on Iroquois. “You look down Iroquois at night now, it’s black. It’s very dangerous.”
The war to keep the lights on in Detroit is a serious one. Thieves, antiquated equipment and a lack of funding have made it impossible for city officials to catch up to the problem.
City officials estimate 15-20 percent of the 88,000 lights in the Motor City are not working, and they acknowledge that figure could be as high as 50 percent in some neighborhoods. Providing lighting to the city costs $10.7 million annually.
“The question is, does the city have resources to really do it, and the answer to that is probably no,” Brown said. “And so the issue is, what are your options?”
They should pass a law forcing abandoned houses to be placed on the MLS within one month;-)
damn goons.
My parents in a residential neighborhood in MA have to pay a very small amount to their town each year (separate from property and other taxes) in order to keep the streetlight in front of their house on.
““This city…it’s dark without streetlights,” said Wicks, who lives on Iroquois. “You look down Iroquois at night now, it’s black. It’s very dangerous.” ”
That RACIST talk, man!!
17 Oct, 2011, 03.07AM IST, Reuters
Avoid investing in US, Europe equities
Here is something every wealth manager thinking about betting big on Europe should consider: Ask yourself, do you have a special insight into Euro zone politics, or do you just feel lucky? Because in the end, this thing is not going to be about economics, or even about the art of the possible, it will be about will, envy, aspiration and caprice.
…
Brazil Makes Its Own Manhattan
…The market-research firm IBOPE Inteligência found that prices for newly constructed apartments across São Paulo climbed 31 percent from a year ago. Prices for existing properties in some coveted neighborhoods surged even higher: apartments in Jardins were up 81 percent; Itaim Bibi rose 59 percent.
“The market’s getting a little out of hand,” says Marcos Faria Lamacchia, a banker who bought his apartment in Jardim América two years ago and was recently offered a price in the millions of dollars, double what he paid. “I’d rather put my money in Miami, where it’s still possible to buy low.”
http://www.nytimes.com/2011/10/16/magazine/key-brazil-makes-its-own-manhattan.html?_r=1&ref=realestate
What is the multiple of income to buy a place? Are wages rising as rapidly?
We saw as high as 10x in some places in America before the pop
Currently it is a high as 30x in China and 10x in Australia…
You’d think the world would have learned its lesson by now, yet the the real estate bubbles just keep coming, because “it’s different here”.
It’s different here, the economy is working of a whole new paradigm. /sarcasm off
Life is too short to just learn from your own mistakes. Sometimes it is worth to look at other people’s mistakes and try to avoid repeating those in your own life. But I guess for some folks nothing beats 1st hand experience.
“Experience keeps a dear school, but fools will learn in no other.”
–Benjamin Franklin
It’s different here, the economy is working of a whole new paradigm. /sarcasm off
It IS different in Brazil, crazy different.
1. Brazil reported a trade surplus equivalent to 3074 Million USD in September of 2011. Brazil has an export-oriented economy. The main exports are transport equipment, iron ore, industrial raw materials, soybeans, footwear, coffee, autos, automotive parts, machinery. tradingeconomics dot com (Brazil protects its “commie” jobs with laws, duties and tariffs)
2. Under presidents conservative Cardoso, “socialist” Lula who left office in Jan. with an 85% approval rating and now former “marxist rebel/tortured political prisoner Dilma Rousseff, Brazil has added, from poverty, 20% its population to the lower middle-class while preserving the rich and existing middle class.
3. Through federal laws designed to interfere with the “free-market”, Brazil increased its minimum wage 60% between 2002-2010. “A number of studies have shown that increasing the minimum wage over the last few years had a big influence in reducing inequality and helped improve distribution of wealth around the country” Riotimes dot com The increase in the Brazilian wages has caused a surge in the economy as now formerly poor Brazilians have some purchasing power.
4. Through a 25 year government effort mostly paid by tax dollars, Brazil is now energy independent. After they became energy independent, a few years back, they discovered one of the largest oil finds in the world the past 30 years.
5. Brazil has no wars. (What’s up with that?)
6. Brazil is under-housed with an estimated shortage of 10 million housing units.
7. In Sao Paulo and Rio, there is no more land in the desirable areas. None.
8. Total outstanding mortgage debt in Brazil is equal to about 5% of Brazil’s yearly GDP as compared to about 70% in the USA.
Brazil might be having a housing bubble but it is a different kind of bubble.
4. Through a 25 year government effort mostly paid by tax dollars, Brazil is now energy independent. After they became energy independent, a few years back, they discovered one of the largest oil finds in the world the past 30 years.
5. Brazil has no wars. (What’s up with that?)
Eyes in “$hock-n-Awe!”
Cheney-Shrub / 8 years = 1.2 million US jobs created
Jimmay “The Evil” Carter / 4 years = 10.2 million US jobs created
Yet another Cheney-$hrub “$hadow Legacy”, Effect #86: Georgia peanuts better job$ fertilizer than Texas white-hat$.
Damn those Brazilian socialeest-commies!
Kind of funny that real estate is a better deal in Miami than in Rio, where a college grad earns a US burger flipper salary.
It’s the same in Mexico City. Even though the place is outright dangerous, salaries are a joke, even for college grads housing is incredibly expensive. I have a cousin who is a mid level manager at a US multinational in Mexico City and she earns the princely sum of $4000 US per month. Her worker bees (all accountants) earn $800 a month. Her house (a gift from her wealthy in-laws) is worth about $500,000 US.
Saw the same in Honduras and Guatemala.
Office workers/management making from $500-$1000 per month.
A house/condo in an average neighborhood (nothing special) - $400,000+
Do the math on that. We can’t all be drug lords.
The only thing I could think of is lots of dinero coming home from relatives in America. And that gravy train is over.
Imagine if the US legalized drugs, overnight the prices would crash and there would be no biz for the lords to rein over.
Knowing the US, even if possession were legalized production would still be regulated in such a way that only big business could legally make money from it. Which would prevent prices from crashing.
…and there you have it, Carl. You are exactly right.
Start with weed, just make it flat out legal to grow, smoke and have on ya. Price crashes. Give it a few years, se what happens. Less bar fights, less DUI’s for one, more pizza sales…
Big Alcohol is against it of course.
And I dont smoke.
It’s the “legal to grow” part that will get in the way of making big money from it. Therefore growing will need to be regulated for everyone’s safety. You don’t want anything that hasn’t been grown the “right” way, do you? And lab tested and stored under correct conditions to guarantee a consistent experience? To do otherwise could be dangerous. And lead the more feeble-minded to do things that endanger the rest of us. In fact now that I think about it I can’t believe we’d even consider legalizing it.
Yeah I know cops could actually spend their time and arrest real criminals the ones who kill, maim and rape….lets not forget 8 year olds at a lemonade stand
But the Biggest losers are Lawyers who would lose all that Drug money for legal fees income.
Strange how lawyers never have to prove where the money came from.
Except for F lee bailey taking Stock in exchange for legal fees.
Only a lawyer would argue that he keep the profits for his legal fees…he had no control over the stock doubling in price.
——
I can’t believe we’d even consider legalizing it.
There is no black market for Prozac. The generic version is too cheap (looks like $9 per month). Treat weed the same way then. Stoners dont leave their houses, no fear.
I think that part of it is that Mexico City (and other larger cities)
1) Are where the jobs are
2) Are densely populated (no sprawl) and hence no empty space.
So the choice is either a super long commute (expecially in Mexico City) or you pay through the nose for a more centrally located home, especially if its’ in one of the desireable neighborhoods on the west or south side of town.
The gov’t does subsidize “casas de interes social” but these are usually built out in the boondocks.
This is what they look like:
http://pics.adoos.com.mx/3c0e4c8fdac1f9ace821175f1476c6ef-1-3-excelentes-casas-nuevas-de-interes-social.jpg
They cost about $25K USD and are in the boondocks. Remember that the typical buyer for one of these probably doesn’t have a car (either way the commute to work is pure hell)
I was wondering how would the CEO of Goldman Sachs have designed the bailout. Then I realized, I didn’t have to wonder!
At the peak of the U.S. crisis, then-Treasury Secretary Henry M. Paulson Jr. summoned major bank executives to an October 2008 meeting in Washington and ordered them to immediately accept billions of dollars in government money. Paulson argued that the infusion of funds was vital for saving the financial system and that all the banks had to take the money, regardless of whether they needed it, so none would be singled out for accepting a bailout.
European leaders have rejected a similarly swift and dramatic response.
Leave No Banker Behind, how very thoughtful of Mr. Paulson.
http://www.washingtonpost.com/business/economy/europe-rejects-us-approach-to-financial-crisis-stirring-doubts-about-plan/2011/10/13/gIQACZQVmL_story.html
Washington and ordered them to immediately accept billions of dollars in government money.
Ordered them? I know it’s the “offical line” but somehow I never bought it.
summoned major bank executives to an October 2008 meeting in Washington
lil’ Opie was sweatin’ out the “revealing details” about his Indonesian-Kenyan-Hawaiian birth certificate ’bout that time…
“I was wondering how would the CEO of Goldman Sachs have designed the bailout. Then I realized, I didn’t have to wonder!”
Of course they threw something in for their wives, too:
Rolling Stone
Matt Taibbi
“But if you want to get a true sense of what the “shadow budget” is all about, all you have to do is look closely at the taxpayer money handed over to a single company that goes by a seemingly innocuous name: Waterfall TALF Opportunity. At first glance, Waterfall’s haul doesn’t seem all that huge — just nine loans totaling some $220 million, made through a Fed bailout program. That doesn’t seem like a whole lot, considering that Goldman Sachs alone received roughly $800 billion in loans from the Fed. But upon closer inspection, Waterfall TALF Opportunity boasts a couple of interesting names among its chief investors: Christy Mack and Susan Karches.
Christy is the wife of John Mack, the chairman of Morgan Stanley. Susan is the widow of Peter Karches, a close friend of the Macks who served as president of Morgan Stanley’s investment-banking division. Neither woman appears to have any serious history in business, apart from a few philanthropic experiences. Yet the Federal Reserve handed them both low-interest loans of nearly a quarter of a billion dollars through a complicated bailout program that virtually guaranteed them millions in risk-free income.”
I remember this story.
Has any member of congress questioned this. Silence
Marie Antoinette is alive and well.
“Neither woman appears to have any serious history in business, apart from a few philanthropic experiences.”
I’m gonna guess both women have serious history in upscale retail establishments.
“Yet the Federal Reserve handed them both low-interest loans of nearly a quarter of a billion dollars through a complicated bailout program that virtually guaranteed them millions in risk-free income.”
Did the Fed brass KNOW they were ‘bailing out’ Wall Street CEO wives?
I think Matt Taiibi articles should be required reading down at the OWS tent cities. Bring ‘em up to speed real fast.
It occurs to me that we may be witnessing one of the largest transfers of wealth since the colonial era:
1) Debt
2) Globalism
The current structure of the debt markets leads to bubbles and taxpayer bailouts. The net result is massive transfers of wealth from one group to another.
Globalism - we watch the transfer of jobs and wealth from the US to other countries, and in return we buy trinkets and gadgets from them. It’s just like being a colony.
You have problem with Corporate Capitalist Communism, comrade?
I’ll eco that…;-)
This capitalism idea sounds good, the USA should try it.
Too Big Too Fail is not capitalism.
Bank Transfer Day - Nov. 5th
There’s a fb page with info.
That should move up slightly my date to transfer my funds out of BofA, most likely to a credit union. They’re not going to shaft me with fees to use my debit card to access my money.
Could there be enough transfer of funds on short notice to trigger a bank run?
The squad has had the pleasure of closing 3 TARP bank credit cards in the past year, only keeping Chase open because of payment history impact on credit score, and because we love Jamie Dimon
You have to admit, he does have very good hair.
NY Times ran a story this weekend about people who are angry at the new fees but have decided not to change banks because shifting their automaticly paid bills would be too burdensome.
Learned helplessness.
And realistically changing banks is not a 1 day thing. You need to open a new account, then change your direct deposit into the new account, then make sure all your checks written against the old account clear (why does there always appear to be stragglers?) and then go and close your old account with what is now a realtively low amount that may trigger fees for being below the mininumum.
But I agree, if you’re really angry, why do you not stand up for yourself? Pathetic.
It isn’t a one day thing at all. What it requres more than anything else is significant cash. You have to be able to write a substantial check to fund your accounts at the new place and start the process of switching over. You need to keep both alive at the same time on the assumption that the switch may not be immediately effective and to let the old checks clear. You need to deal with automatic deposit. And you need to wait a while before you go to collect that “close out” check from the new place.
That said, I did it way back when and it isn’t that hard. Tedious, but not hard. I wonder if the having cash on hand to have two fully functioning bank relationships at the same time is the real problem, not the automatic withdrawal they set up with Comcast.
“And realistically changing banks is not a 1 day thing.”
I agree. But the process is manageable. And once done, I’m rid of being held hostage by big banks jacking up fees on a whim. The rough timeline I have:
1) Find new bank, open account, get routing number, order checks, order debit/credit card.
2) Change routing on direct deposit for paycheck (and effective date)
3) There are two sizable checks I write each month. Wait for the second of these to clear (rent check) early in the month.
4) Shift three small automatic payments to the new account (less than $50 total).
5) Close the old account once the rent check clears.
At most, I might have costs of less than $50 for the changes (new checks, any one-time minimum monthly balances fees for the old or new bank, fee to visit a BofA branch). There will also be some time involved to set up online bill pay for the new account. There is some time involved, but I refused to be gouged over things like the new monthly debit card fee. There’s no reason they should do that other than they think they can.
I also found an interesting read for those contemplating changing banks from a couple that did so from two of the big banks. One thing to remember: Individual bank employees are generally not your enemy. Big bank policies are.
http://www.reddit.com/r/occupywallstreet/comments/ldmo9/i_just_closed_out_my_chase_account_and_have_some/
And one question since I have changed bank accounts in 17 years, is there a preferred means on making the final transfer from the old bank to the new bank?
I don’t need to have the transferred funds instantly available, but would preferred not to have them tied up in the transfer for a week or ten days either.
Who does automatic payments anyway?
if they focus on BofA, it could cause trouble.
B of A trades at about $6.05, if it drops below $5 and stays, it triggers sells.
“if they focus on BofA, it could cause trouble.”
It isn’t focused on BofA specifically. But if one of the big banks were to fail because of account withdrawals related to new fees, would that send a big enough message to the other big banks?
War on Drugs now creating the new jobs in Texas!
Marin “Gordo” Herrera and his companies, New Millennium Developers and Herrera Property & Investments, had acquired 77 properties in the McAllen area. He had booked at least $4 million in revenue. But in reality, his success stemmed from the underground economy of drug trafficking that has flourished along the border but doesn’t figure in official reports on the gross domestic product or employment rates. He had bought the properties with drug money and used his companies as a shell to launder the $4 million.
http://www.mysanantonio.com/news/state/article/Drug-trafficking-helping-economy-along-border-2221975.php
Texas law enforcement officials say several Mexican drug cartels are luring youngsters as young as 11 to work in their smuggling operations.
http://www.reuters.com/article/2011/10/17/us-cartels-children-idUSTRE79G4UX20111017
California takes another approach:
Border agency’s rapid growth accompanied by rise in corruption
Since October 2004, 132 U.S. Customs and Border Protection employees have been indicted or convicted on corruption-related charges.
http://www.latimes.com/news/local/la-me-border-corrupt-20111017,0,4783023.story
Legalize it. Stoners will be stoners. Save lives and money on the war.
In California they have been trying but the FEDS are coming in to shut it down.
Dumbest thing I’ve ever seen.
My FIL grows this in another medical MJ state.
Makes decent money pays taxes on it. The user buys it and pays taxes on the purchase. Cops can divert their attention to other real problems.
it wont be free until the Feds legalize it. Seed prices will skyrocket, then drop.
Some manufacturing is coming back to US.
http://seattletimes.nwsource.com/html/businesstechnology/2016524160_inpersonfichter17.html
“Paul Fichter realized a decade ago that he could profitably make distinctive tap handles for breweries by outsourcing the detailed production work to China.
Recently, he realized something else: For practical reasons, the best place for his fast-growing, Seattle-based Taphandles to put two new manufacturing operations was in the U.S.”
So being near a lot of Smart people is the key to employment in America………..Hello Detroit!
———-
So, we’re replacing Chinese labor with machines run by U.S. workers. The machines will make 10 times more product than a person could in China
Because Boeing is nearby, we’ve got a great labor pool
It’s just too complicated and too dangerous, we need to return to business as usual as soon as possible
I hope these clowns put a leash on the financial sector.
I think people have gotten wind of just what kind of rot exists between politicians and their big donors. If we get kabuki instead of real reform, hopefully, the politicians doing the dance will get cleaned out this 2012.
Volcker Rule Divides Regulators
nytimes
BEN PROTESS, On Sunday October 16, 2011, 9:48 pm EDT
Regulators have faced a barrage of complaints from lawmakers and financial industry lobbyists in their 14-month-long quest to constrain risky trading on Wall Street, an effort known as the Volcker Rule. Now, as regulators begin a push to produce a final draft of the rule, they face hurdles from an unexpected group: themselves.
http://finance.yahoo.com/news/Volcker-Rule-Divides-nytimes-3602065336.html?x=0&sec=topStories&pos=main&asset=&ccode=
Occupy Wall Street protests stop a foreclosure. FYI this happened as a mass movement on the farm in the 1930s.
http://www.msnbc.msn.com/id/44908122/ns/us_news-life/
“Nonprofit advocates say a series of bold protests — with reinforcements from the “Occupy Wall Street” movement — and a spate of media interest put Rose in the limelight and forced the banks to back down.”
“It was a small victory — and Gudiel still has to finalize her deal with the bank — but one that Southern California housing activists hope to repeat. It also provides an example of how the sprawling ‘Occupy’ movement — often criticized for its lack of focus — can lend muscle to specific goals pursued by organizations and individuals.”
Well, I hope OWS did their homework and is not “protecting” some serial refinancer…
As usual – the “journalist” does not gather ANY real information on why the house is in foreclosure.
NEW YORK (AP) — Kinder Morgan plans to buy El Paso Corp. in a $20.7 billion deal that’s expected to create America’s largest natural gas pipeline operator.
The deal also adds to founder and CEO Richard Kinder’s energy empire. Kinder, 66, started the company with friend William Morgan after leaving his post as president of the now-defunct Enron Corp. Forbes lists his net worth at $6.4 billion.
Kinder Morgan will more than double the size of its pipeline network by purchasing El Paso. The new pipeline system would stretch 80,000 miles — long enough to wind around the globe three times. Kinder Morgan’s pipelines in the Rocky Mountains, the Midwest and Texas will be woven together with El Paso’s expansive network that spreads east from the Gulf Coast to New England, and to the west through New Mexico, Arizona, Nevada and California.
The acquisition comes on the heels of other consolidation in the industry. Energy Transfer Equity is planning to buy Southern Union Co. for $5.7 billion after a tug of war with Williams Cos.
With more pipelines under its control, Kinder Morgan could charge suppliers higher transport fees, and that may affect the price that utilities and other major natural gas buyers pay for natural gas
Evercore Partners (NYSE: EVR - news) and Barclays Capital advised Kinder Morgan on the deal, while Morgan Stanley (EUREX: DWDF.EX - news) advised El Paso. Goldman Sachs (NYSE: GS - news) acted as an adviser to El Paso
Get ready for higher gas prices.
Consolidation at some point destroys capitalism. No competition.
Shades of Enron. Oh dear.
Three weeks ago I requested a last payment letter from BofA, N.A.; checked my Post Office Box this morning…nothing. However, I was able to query the last payment details from the automated voice machine, so I wrote the details (pay-off amount and recording fee) on a sticky note, and enclosed a check along with a regular payment coupon. Dropped the envelope in the slot 90-minutes ago closing my 30-yr mortgage in 8-yrs, 8-months.
I should be mortgage free…fingers crossed.
I should be mortgage free
Congratulations.
How are you going to get your free mortgage modification and federal principle reduction give-away?
You are going to miss all those governmental gravy trains!
And you need to liberate some equity soon. Maybe buy a boat or some investment property…
How are you going to get your free mortgage modification and federal principle reduction give-away?
Meh, I’m still waiting for mine.
And you need to liberate some equity soon. Maybe buy a boat or some investment property…
Now that is something the banksters will be more than happy to accomodate you with.
“And you need to liberate some equity soon. Maybe buy a boat or some investment property…”
I confess that every winter I look daily at Scottsdale, AZ properties. Winter is just around the corner up here in Eastern Washington’s Columbia Basin, and that means six months of awful weather, and nearly four months of no bicycle commuting due to ice and snow.
A HELOC and a boat are a great idea! And a timeshare!!
You are awesome rms….the original American Dream: having a house w/o a mortgage.
If you’re in a low property tax state, even better.
“If you’re in a low property tax state, even better.”
No income tax in Washington state, but we do have Property and Sales taxes. A couple of years ago my property’s accessed value jumped from $128k to $181k in one fell swoop as they caught the 2007 price spike; local median incomes haven’t budged.
Dropped the envelope in the slot 90-minutes ago closing my 30-yr mortgage in 8-yrs, 8-months.
Congrats!
(Are you the one that posted awhile back that you repo’d cars?)
“Are you the one that posted awhile back that you repo’d cars?”
Yes Sir, that would be me.
YAY!
HEY! Way to walk away, rms. Congratulations!
http://market-ticker.org/akcs-www?post=196085
Are any of the “bottom 99%” retarded enough to believe Barry is on their side?
It is always a choice of the lesser of two evils. >
Only if you’re a sheep and a lemming.
Sammy- Put down the Vaseline. That doesn’t even make sense.
Give me an example of when it was not in the last 30 years except Clinton. Who are you for in 2012? Cain?? lol!
I am both and I voted for Bush, twice. Next I will vote for Romney.
yummmmm…..tv tells me so.
Budget cuts claim hundreds of thousands of county, city jobs
By Paul Davidson, USA TODAY
Updated 38m ago
By Marcus Castro, AP/ The Fayetteville Observer
A line Oct. 12 at a job fair in Fayetteville, N.C.
Local governments, once a steady source of employment in tough economic times, are shedding jobs in unprecedented numbers, and heavy payroll losses are expected to persist into next year.
The job cuts by city and county governments are helping offset modest private-sector employment gains, restraining broader job growth.
“They’ll continue to be a drag on the overall (employment) numbers and the economy,” says Wells Fargo economist Mark Vitner.
Localities have chopped 535,000 positions since September 2008 to close massive budget deficits resulting largely from sharp declines in property tax receipts. That exceeds the 413,000 local government jobs cut from 1980 to 1983, the only other substantial downturn in local government employment, according to federal records that go back to 1955.
Christopher Hoene, research director for the National League of Cities, estimates an additional 265,000 or so jobs could be eliminated by the end of 2012.
The cuts so far have mostly come since the recession ended in mid-2009, although they do not yet top those made in manufacturing and construction during and after the recession.
Local government budget woes are continuing even as state layoffs have eased somewhat amid a modest rebound in consumer spending that has lifted state sales tax revenue.
Since January 2010, states have trimmed 51,000 positions, less than 1% of its workforce of 5.1 million, while localities have slashed 406,000 jobs, or nearly 3% of payrolls then totaling 14.5 million.
Cities and counties largely depend on property tax revenue, which has plummeted as home values have continued to decline. Also, the effects of lower property values on taxes are typically delayed, because many jurisdictions do assessments every other year or average appraisals over several years to figure taxes, says Hoene and Kim Rueben, senior fellow at the Urban Institute.
At the same time, states are reducing aid to local governments in an effort to balance their own budgets. The 2009 federal economic stimulus made up some of the gap, but that money ran out this year.
…
Projected Wall Street job losses bode ill for Connecticut
October 17, 2011
By Keith M. Phaneuf
A new report predicting 10,000 job losses by the end of 2012 and a decline in profit margins for Wall Street’s securities industry has economists, business leaders and state legislators anticipating ripple effects here, both for Fairfield County’s financial services sector and for the state budget.
And while opinions were mixed over just how severe those effects might be, there was consensus Monday that the impact would be negative.
“Ominous,” said Edward Deak, a Fairfield Univeristy economist, in response to last week’s report from the New York State Comptroller’s Office projecting job losses on Wall Street would reach 10,000 by the end of the 2012 calendar year. That same report also warns that pre-tax profits for New York Stock Exchange member firms, which were less than half in 2010 of their record-setting level in 2009, should drop another 35 percent by the end of 2011.
“That certainly translates into slow job growth in Connecticut in 2012,” said Deak, who also serves as Connecticut model manager for the New England Economic Partnership, which produces a semi-annual regional forecast. And with most economists already predicting meager job creation numbers here for next year, this latest development could mean “job growth may be stalled entirely,” Deak added.
“Wall Street recovered quickly from historic job losses in 2007 and 2008 — greatly aided by the intervention of the federal government — but it still faces significant challenges,” the N.Y. comptroller’s report states.
…
Bloomberg
Fed’s Evans Says U.S. Faces ‘Massive’ Job, Output Shortfalls
October 17, 2011, 8:21 PM EDT
By Vivien Lou Chen and Timothy R. Homan
Oct. 17 (Bloomberg) — Federal Reserve Bank of Chicago President Charles Evans said the U.S. faces “massive shortfalls in output and employment” and called for new policy steps to ensure the Fed meets its congressional mandate.
The 53-year-old regional bank chief reiterated his proposal, initially unveiled in a speech last month, to keep the target for the benchmark U.S. interest rate near zero until either unemployment falls below 7 percent or the medium-term inflation outlook rises above 3 percent. He said he would support more asset purchases if those objectives aren’t reached.
“Some may find such a policy proposal to be hard to understand, or even risky,” he said today of his plan in the text of a speech in Detroit. “But these are not ordinary times.”
The remarks place the Chicago Fed president among the Federal Open Market Committee members who, according to minutes of the FOMC’s gathering in September, wanted to keep further asset purchases as an option to boost a flagging recovery. Evans backed the committee’s Sept. 21 decision to push down longer- term rates and its Aug. 9 commitment to keep the overnight lending rate between banks near zero through at least mid-2013.
…
Extraordinary times call for an extra dose of the ordinary, d’oh!
OCTOBER 17, 2011, 8:00 P.M. ET
Fed’s Evans: May Have To Accept Inflation Rise To Boost Hiring
By Michael S. Derby
Of DOW JONES NEWSWIRES
BOSTON (Dow Jones)–The Federal Reserve may have to let inflation heat up a bit as it pursues a much needed stimulus effort aimed at lowering the unemployment rate, a key Federal Reserve official said Monday.
“I would argue for further policy actions” given how high the unemployment rate is, in light of the central bank’s official mandate of promoting price stability and maximum employment, Federal Reserve Bank of Chicago President Charles Evans said. Echoing his other recent remarks, the official said the Fed is doing much worse on promoting job creation relative to containing price increase, and to rectify that imbalance, the institution may have to change its views on inflation, at least for a time.
“Given how badly we are doing on our employment mandate, we need to be willing to take a risk on inflation going modestly higher in the short run if that is a consequence of polices aimed at lowering unemployment,” Evans said, in comments taken from the text of a speech prepared for delivery before an event held by the Michigan Council on Economic Education.
…
May have to accept job as slave.
“Echoing his other recent remarks, the official said the Fed is doing much worse on promoting job creation relative to containing price increase, and to rectify that imbalance, the institution may have to change its views on inflation, at least for a time.”
The Fed is doing anything to promote job creation? When was the last time it did that directly?
As well intended as Ron Paul may be, I submit this proposal would turn a bad employment situation into a calamity.
October 17, 2011, 5:43 pm
Paul Plan Would Eliminate Cabinet Departments to Cut $1 Trillion
By JIM RUTENBERG
9:29 p.m. | Updated LAS VEGAS — Representative Ron Paul on Monday unveiled an aggressive budget plan that would greatly shrink the federal government that he is seeking to run, eliminating the agency that oversees airport security, the departments of energy and education — and three others — while cutting all war financing.
Providing a stark vision of what a libertarian takeover of the White House would look like, the plan would slash the federal budget by $1 trillion in a single year and, Mr. Paul said, bring the budget into balance within three.
The federal workforce would be cut by 10 percent across the board. Aid to foreign nations would stop flowing altogether. And, reflecting the way Mr. Paul would shrink the very job he seeks, the president’s annual salary would be reduced to $39,336 from $400,000.
At a boisterous news conference at the Venetian Hotel here Mr. Paul did not speak in detail about how he would persuade Congress to approve a plan that would greatly reduce or eliminate programs considered sacrosanct to both parties.
“A lot of people will say, ‘Cutting $1 trillion in one year — that sounds radical,” Mr. Paul said to a room of cheering supporters. “I operate on the assumption that the radicals have been in charge way too long.”
Mr. Paul shared details of his plan on the eve of a Republican debate here Tuesday night hosted by CNN and the Western Republican Leadership Conference, when all the campaigns will be closely watching the former Godfather’s Pizza executive Herman Cain. In recent days Mr. Cain has stolen Mr. Paul’s fiscal-policy thunder — and earned an explosion of news media coverage treating him like a top-tier candidate — with his tax plan known as “9-9-9,” (it would replace the current tax code with a flat 9 percent personal income tax, a 9 percent corporate tax rate and a 9 percent national sales tax).
Mr. Paul’s plan has no such catchy title. The 11-page document on his Web site was simply called, “Plan to Restore America.” And it was unclear whether it would be as successful in entering the campaign conversation, attention grabbing as its proposed cuts may be.
…
The Federal Diary
Budget-cutting proposals could affect federal employees
By Joe Davidson, Monday, October 17, 4:44 PM
The congressional “supercommittee” charged with cutting trillions from the nation’s deficit is moving into the final stretch with a range of proposals affecting federal employees.
Officially called the Joint Select Committee on Deficit Reduction, the 12-member bipartisan panel is looking for ways to reduce the deficit by $1.5 trillion over 10 years. The committee, whose plan is due by Thanksgiving, has been getting advice from all over, including a flurry of letters last week from congressional colleagues who have oversight responsibility for the federal workforce.
The bipartisan committee, tasked with coming up with $1.5 trillion in deficit cuts, must come up with a plan by Thanksgiving.
That advice ranged from right to left, spanning partisan and ideological approaches to managing the workforce. No one knows yet what joint committee members will decide regarding federal employees, but the recommendations by their colleagues and from President Obama outline the main policy choices the committee will consider.
Rep. Chris Van Hollen (D-Md.), a federal workforce supporter on the panel, has repeatedly made it clear that “we cannot balance the budget on the backs of federal employees and they should not be unfairly singled out as we work to reduce the deficit,” his spokeswoman, Bridgett Frey, said recently.
But some hits, in addition to the two-year pay freeze already imposed on federal workers in January, seem likely. Even if the joint committee agrees with Democrats on the House Committee on Oversight and Government Reform and calls for no other measures directly aimed at the workforce, potential cuts to agency budgets could affect employees.
Federal workers also should not be surprised if they are called on to pay more for retirement benefits. Obama has proposed an increase of 1.2 percentage points in employee retirement contributions. Rep. Darrell Issa (R-Calif.), chairman of the oversight panel, recommended significantly larger employee retirement payments. And, significantly, the chairman and the top Republican on the Senate Homeland Security and Governmental Affairs Committee , Sens. Joseph I. Lieberman (I-Conn.) and Susan Collins (Maine), respectively, together called for basing retirement income on the highest five years of salary instead of the highest three, with less impact on those close to retirement.
…
The Federal Reserve bank is like a Frankenstein. It has the mind of a socialist, the heart of a capitalist, and no soul to stitch the two together.
Scary, but true.
Bond investing
Death by low yields
Bond-fund managers face a dilemma
Oct 8th 2011 | from the print edition
MONEY-MARKET fund managers have been in pain for some time. Investors withdrew $151 billion from such funds, which invest in short-term securities, in the first nine months of the year, according to EPFR Global, a research firm. They took out almost $508 billion in 2010. With interest rates close to zero, money-market funds cannot offer a decent return. Many managers have been forced to waive their fees.
A similar problem now faces the managers of bond funds. The Federal Reserve has signalled that it intends to keep interest rates low for another two years. All Treasury bonds that mature before 2016 offer a yield of less than 1% a year; even the ten-year bond pays less than 2%. It is now hard to offer a yield that, after fees, looks attractive to retail investors. The yield on mutual funds that invest in Treasuries is less than half its level of a decade ago, according to Lipper, another research outfit (see chart).
British fund managers face a similar problem. “Every single gilt offers a yield that is less than inflation,” says Mike Amey, who manages sterling portfolios for PIMCO, a fund-management group. The situation is unlikely to improve, in Mr Amey’s view, since the Bank of England is determined to keep interest rates low. That means he is looking for opportunities in the corporate-bond market, especially as many companies have strengthened their balance-sheets in recent years, and also at bonds issued by emerging-market governments, many of which have lower debt-to-GDP ratios than their counterparts in the developed world.
This portfolio shift is one of the aims of quantitative easing. Central banks want to encourage institutional investors to provide more credit to the corporate sector. The problem, however, is that markets have not been kind in recent weeks to those fund managers who have taken the plunge. Worries about the strength of the global economy have caused investors to sell riskier assets and stampede for the safety of government bonds.
…
Mortgage finance
Greed and ambition
Why Fannie Mae and Freddie Mac need to diet
Oct 15th 2011 | from the print edition
Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led to Economic Armageddon. By Gretchen Morgenson and Joshua Rosner. Times Books; 331 pages; $30 and £19.99. Buy from Amazon.com, Amazon.co.uk
Guaranteed to Fail: Fannie Mae, Freddie Mac, and the Debacle of Mortgage Finance. By Viral Acharya, Matthew Richardson, Stijn van Nieuwerburgh and Lawrence White. Princeton University Press; 232 pages; $24.95 and £16.95. Buy from Amazon.com, Amazon.co.uk
“THE shapers of the American mortgage finance system hoped to achieve the security of government ownership, the integrity of local banking and the ingenuity of Wall Street. Instead they got the ingenuity of government, the security of local banking and the integrity of Wall Street,” David Frum, a former White House speechwriter, lamented in 2008. In “Reckless Endangerment”, Gretchen Morgenson, a veteran New York Times reporter, and Joshua Rosner, a consultant, provide the best account yet of how this system went off the rails. So successful have the pair been at ferreting out the details that the book is at the top of Amazon’s worldwide bestseller list (see article).
…
The volatility of modern wealth
Rags to riches to rags to riches
How to write about the financial crisis—and (see article) the pitfalls to avoid
The High-Beta Rich: How the Manic Wealthy Will Take Us to the Next Boom, Bubble and Bust. By Robert Frank. Crown; 256 pages; $26 and £16.95.
This sucker is going down — AGAIN!
The Financial Times
October 17, 2011 7:26 pm
Improvement in US mortgage delinquencies ends
By Tom Braithwaite, Shahien Nasiripour and Ajay Makan in New York
Fears about the health of US consumer balance sheets grew on Monday as Citigroup and Wells Fargo joined JPMorgan Chase in reporting new signs that homeowners and credit-card borrowers are falling behind on their payments.
The banks’ third-quarter results were hit by expected declines in investment banking, reflecting turbulence in global markets. But the reports also revealed weakness in the consumer side of their businesses – with mortgage delinquency numbers suggesting that record low mortgage rates and government loan modification programmes are failing to help a large swathe of homeowners.
Overall revenues fell 8 per cent at Citigroup year-on-year and 6 per cent at Wells, sending their shares down 1.7 per cent and 8.4 per cent, respectively. The S&P 500 index fell 1.9 per cent.
Wells said delinquencies of more than 90 days in its main portfolio of consumer loans – including mortgages and credit cards – rose 4 per cent to $1.5bn, the first increase since 2009. Early stage delinquencies in its retail business remained flat at 6.13 per cent after falling for three quarters. The bank increased its provision for consumer-banking losses for the first time in two years.
“The economic recovery has been more sluggish and uneven than anyone anticipated,” said John Stumpf, Wells chief executive.
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