Bits Bucket for December 26, 2011
Post off-topic ideas, links, and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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Happy Boxing Day !! — Our family has gone with this tradition as too many tried to squeeze in multi get togethers on Christmas with inlaws etc.
How do you celebrate? Gifts to the servants?
I think the US national celebration has something to do with using gift cards, returning unwanted gifts for store credit, and eating leftovers.
I hope everyone had a merry Christmas, Hanukkah, Kwanzaa or Festivus (for the rest of us) and let’s hope the Mayans are wrong about 2012.
No, alpha, you box the servants ears whilst commenting on their crooked teeth.
Flippers’ role in housing flop larger than thought
By Kimberly Miller Palm Beach Post Staff Writer
Posted: 8:29 p.m. Sunday, Dec. 25, 2011
More than 30 percent of Florida homebuyers during the boom year of 2007 had two or more mortgages, evidence of rampant investment that is partly blamed for real estate’s ruination, a recent federal report says.
A Federal Reserve Bank of New York study released this fall uses previously undisclosed credit and loan information to show that home flippers played a bigger role than previously thought in bringing down the market.
In 1999, just 16 percent of Florida homebuyers had two or more loans.
Chronicled on the Fed’s blog this month, the report singles out the hard-hit states of Florida, California, Arizona and Nevada to compare real estate purchases between 2000 and 2010 with the rest of the nation.
In 2006 in these so-called “sand states,” the report reveals, 10 percent of home purchases were made by people with four or more mortgages on their credit reports. That’s an increase from about 3 percent in 2000.
Nationally, about 5 percent of home purchases in 2006 were made by people with four or more homes.
“We conclude that investors were much more important in the housing boom and bust during the 2000s than previously thought,” the report notes. “In the end, even the value of the 20 percent down payments made by responsible, prime borrowers was wiped out, leaving the housing market, and the economy, in the vulnerable state we find them in today.”
But not everyone is ready to skewer investors, many of whom are now buying up the glut of foreclosures and turning them into rentals - a practice of buying and holding, rather than buying and flipping.
“In hindsight, we can point out a lot of demons, but I don’t think flippers were any more responsible for the problems than anyone else,” said Ken Johnson, a financial and real estate professor at Florida International University in Miami. “Flippers saw an opportunity to make an investment and get an abnormal return on what they were putting in.”
Johnson’s bigger concern, and one shared by the report’s authors, is making sure the real estate bust is not repeated.
Johnson blames reduced underwriting standards for allowing unworthy borrowers to buy a home and investors to run up pricing.
“You could basically say anything on your loan application, and they weren’t going to verify it,” agreed Bill Richardson, president of the Realtors Association of the Palm Beaches.
“Flippers are partly responsible for what happened, but it was the government and their underwriting standards that made it possible for the flippers to flip.”
The federal report notes that by 2006, 38 percent of the risky subprime loans nationwide went to homebuyers with little employment or salary documentation. The loans were sometimes called “liar loans” because of the ease in manipulating information to gain hefty mortgages.
In 2001, just 22 percent of subprime loans required little or no documentation, according to the report.
Subprime loans also came with higher interest rates. But because flippers had no intention of keeping a home, interest rates were of little concern. Because the return on investment was so high, they also cared little for how much they had to bid to make a purchase, the report says.
That led to average home prices that more than doubled in high-risk states between 2000 and 2006.
In July 2000, the median home price in Florida was $119,600, while Palm Beach County’s price was $142,500, according to the Florida Realtors.
By July 2006, Florida’s median price had risen 109 percent to $250,800. Palm Beach County’s jumped to $390,100 - a 174 percent increase.
In November, Florida’s median sales price was $130,100, while Palm Beach County’s was $183,700.
http://www.palmbeachpost.com/money/real-estate/flippers-role-in-housing-flop-larger-than-thought-2056491.html -
“Flippers are partly responsible for what happened, but it was the government and their underwriting standards that made it possible for the flippers to flip.”
Someone correct me if I’m not remembering this correctly, but wasn’t it the private mortgage investors who turned a blind eye toward the lax underwriting standards so they could roll out a monthly MBS (mortgage backed security) deal?
Indeed it was.
And this also raised my ire: “but it was the government and their underwriting standards that made it possible for the flippers to flip.” At the time, Fannie and Freddie were private companies with corrupt CEO’s who chased profits with the best of them.
Your memory is correct. I would only add the real firewall was the rating agencies. They stood at the gate like Cerberus, all that must pass had to pay with their souls. They have no honor and yet nation’s destinies are judged by their decrees. All the rating agencies need to be completely reformed. How do you hold them accountable?
You go back to the traditional system.
Instead of the bond-issuer paying the ratings agencies, you have the bond-buyers pay the ratings agencies. That ensures that if they don’t do a good job, they will get dumped.
Having the issuers pay the ratings agencies opens up entirely new forms of corruption.
Incidentally, you have Congress to blame for this.
Sounds good on paper, but you would also have to outlaw the consulting services the rating agencies sold as I believe they made a large part of their profit this way. ie we’ll rate your bonds highly if you higher us to tell you how to get a high rating.
Good points. After some thought about this I would also demand a completely open library of every algorithm that is used to calculate risk on all types of rated debt. New financial ‘instruments’ must be certified by a panel of accountants and regulators within the Treasury Dept.. Every input/output/variable rigidly defined. To fix the problem of corruption it would be nice if they had to elect at least half of their Board of Directors from outside the industry.
“Incidentally, you have Congress to blame for this.”
Absolutely. Congress are the “deciders”, so to speak. For now, they hide behind the “Wall Street is to blame” canard. It’s a symbiotic relationship, though.
Incidentally, it worked fine until Congress meddled in the 80’s, if I remember correctly so it’s not a “theoretical construct” - it’s how it used to work until they mucked it up.
They have no honor and yet nation’$ destinie$ are judged by their decree$. All the rating agencies need to be completely reformed. How do you hold them accountable?
Make ‘em $tandard & Poorer!
Greenspan and Bernanke are most responsible of all, for the massive cheap liquidity they pumped into the banking system that set off an orgy of speculative malinvestment and speculative excess.
Interest rates are even lower now
Thus the majority of the bubble was not due to easy money.
The thing that has disappeared is the ability to sell crappy loans to someone else. The majority of the bubble was due to securitization. Low interest rates was just the sugar on top.
correction it was due to easy money, but more so it was due to loose lending practices.
On the Seventh Day of Christmas,
My true love showed to me:
Seven Flippers flopping,
Six mortgage defaults,
Five unbuilt condos,
Four years without payments,
Three Robo signers,
Two turtled houses,
And a Deadbeat who`s still living free.
On the twelfth day of Christmas,
My true love showed to me:
A Housing blog where I could see….
Hurry! Only 4 days of Christmas left.
Ten Landlords leaping?
9 Realtors laying/lying?
Prices Fall-la-la-la-la, la-la-la-la…
On the twelfth day of Christmas,
My true love showed to me:
A Housing blog where I could see….
Twelve Dozers Dozzing,
Eleven new vacant lots,
Ten Landlords leaping,
Nine Realtors lying,
Eight markets dropping,
Seven Flippers flopping,
Six mortgage defaults,
Five unbuilt condos,
Four years without payments,
Three Robo signers,
Two turtled houses,
And a Deadbeat who`s still living free.
That`s a wrap! See ya next year Santa.
Happy Kwanzaa?
Does anyone really celebrate that? I think Festivus has a bigger following.
The beauty of both holidays is you can do whatever you want, and call it part of the celebration. I just had a cup of dark hot chocolate with some Marshmallow Fluff in it, to celebrate the mixing of the different colored peoples into a delicious concoction, in the spirit of Kwanzaa.
It was so good, I deemed it a Festivus miracle.
“…there has been a sharp reduction in wealth concentration over the 20th century: the top 1 percent wealth share was close to 40 percent in the early decades of the century but has fluctuated between 20 and 25 percent over the last three decades”
http://blog.american.com/2011/11/the-chart-that-closes-the-case-on-the-inequality-myth/
The great Credit Expansion apparently hasn’t lifted the very wealthy more than the rest of us, not in net terms. The credit contraction after 1929 decimated them on the whole, permanently.
This might be interesting to ponder as we enter another year of a contraction that promises to be more severe than in the ’30s. Another year, for most of us, to determine our post contraction situations, and what themes to sing to along the way.
filed under: Barking up the wrong tree.
“the top 1 percent wealth share was close to 40 percent in the early decades of the century but has fluctuated between 20 and 25 percent over the last three decades””
The authors of the study point to New Deal programs and progressive income taxes as the main reasons for the lessening of the inequality. So thank you FDR and Keynes for transforming America from a robber baron country to a middle class country. Now that their programs are being dismantled, and taxes reduced on the wealthy, we’re sliding back in the robber baron direction. Coincidence?
This one study finds lower levels of wealth inequality than most other studies do, but it still finds great wealth disparity in the US. And the study only goes up to 2000. The Cato Institute kindly offers up some charts to show the wealth inequality only grew a little up until 2007, but then their numbers mysteriously stop. What happened after 2007? This:
“However, after the Great Recession which started in 2007, the share of total wealth owned by the top 1% of the population grew from 34.6% to 37.1%, and that owned by the top 20% of Americans grew from 85% to 87.7%. The Great Recession also caused a drop of 36.1% in median household wealth but a drop of only 11.1% for the top 1%, further widening the gap between the 1% and the 99%.[11][12][13] During the economic expansion between 2002 and 2007, the income of the top 1% grew 10 times faster than the income of the bottom 90%. In this period 66% of total income gains went to the 1%, who in 2007 had a larger share of total income than at any time since 1928.”
wikipedia
“In this period 66% of total income gains went to the 1%, who in 2007 had a larger share of total income than at any time since 1928.””
wikipedia
There’s that expression again.
Again we all focus on the top 1% but it’s really the top 0.1% that have seen the most dramatic gains. They are the ones that benefit most from privitize the gains socialize the loses, and from market manipulation.
The greed of the socialists knows no bounds. Remember a number of months ago the story about GE paying no income taxes? Big deal! They pay millions (could be billions) in payroll taxes, their employees pay income taxes, millions in property taxes, excise taxes, dividends are taxed, etc.. Still not enough for the spendthrifts in DC. They rail and rant against terrible business people. It’s all about money (the horror.) Yet the spendthrifts in DC and state and local governments LOVE to spend money. They ought to try making. Then then let them pay what they call “fair” taxes.
The greed of the
socialists.01 % knows no bounds.Remember a number of months ago the story about GE paying no income taxes? Big deal! They pay millions to lobby Congress to pay no taxes….
They pay millions (could be billions) in payroll taxes, their employees pay income taxes, millions in property taxes, excise taxes, dividends are taxed, etc.
Your forgot to mention that in lieu of taxe$ their mandatory CorpInc. requirements of sending peon employee’s who contribute to their yearly profit$ to fight in foreign countries to ensure that they have a $afe and $ecure base of operation$ in America.
Are you sure they pay a lot in local taxes. As far as I’ve seen local gov have gone into the bribe the corporation to stay. A local company moved here but it cost tax payers about all the money they’ll make of taxing the payroll for 5 years.
Of course taxes are being reduced on the wealthy. They pay most of the taxes - a disproportionatly large share. Half the population pays no federal income tax. The problem is not taxes it’s excessive spending.
There is moaning and groaning from the spendthrift left about tax rates of 15% on capital gains and hedge funds. People pay taxes in DOLLARS not rates. The NYT (no suprise) had an article the other day about most Mitt Romeny’s income probably being taxed at 15%. He probably pays more taxes in a month than most people pay all year. But still not enough for the tax and spend liberals. Wonder why they don’t spend their own money for their pet projects? Any word yet on how much money Warren Buffet is donating to the treasury? Or Nancy Pelosi or Harry Reid? (Disclaimer - There must be spendthrifts on the other side of the isle, though probably not as many.)
All income should be taxed at the same rate and the same rate for all amounts. The idea that Bill Gates or anyone else should pay a higher rate just because people like measton or alpha-sloth think they have some right to other peoples’ money is just unbelievable. But such are busybody do gooder socialists.
Of course taxes are being reduced on the wealthy. They pay most of the taxes - a disproportionatly large share.
Compared to their income and wealth, the wealthy pay a disproportionately, historically small share. (where have you been?)
The problem is not taxes it’s excessive spending
Why would the problem not be taxes too? Every budget has two sides - income and expenses. (where have you been reading that this is not the case with the Federal Budget and why would it not be?)
Half the population pays no federal income tax.
Half the working population makes less than 26K a year, have seen their real income decline and they pay a much larger share of their income in total taxes than the .01% (where have you been reading your lines?)
most Mitt Romeny’s income probably being taxed at 15%. He probably pays more taxes in a month than most people pay all year.
Mitt Romeny probably makes more in a week than most people make all year.
Wonder why they don’t spend their own money for their pet projects?
Where did you read that Federal budgets and public spending can be meaningfully based on such a concept?
All income should be taxed at the same rate and the same rate for all amounts.
Where do you get this stuff? Says who? The vast majority of Americans believe in progressive taxation and have for decades.
“The vast majority of Americans believe in progressive taxation and have for decades.” Not sure about majority but a lot of people yes, let the taxpayer pay for xyz… and let someone else bear the brunt of the tax burden. Or to paraphase Sammy Schadenfreude a way to get taxpayers to fund the Free $hit Army so they’ll vote straight Democrat every election day.
“The vast majority of Americans believe in progressive taxation and have for decades.” Not sure about majority but a lot of people yes
Poll: Americans Back Taxing Rich bloomberg dot com
…More than two-thirds of all Americans back higher taxes on the rich and even larger numbers think Medicare and Social Security benefits should be left alone, according to a Bloomberg-Washington Post national poll conducted Oct. 6-9.
…More than half of Republicans say wealthier Americans should pay more in taxes to bring down the federal budget deficit.
Fifty-three percent of self-identified Republicans back an increase in taxes on households making more than $250,000, a sentiment at odds with the party’s presidential candidates, who will meet tonight in a Bloomberg-Washington Post-sponsored debate focused on economic issues.
“All income should be taxed at the same rate and the same rate for all amounts.”
I’m glad someone else agrees with me on the capital gains tax rate…
Coloradans’ paycheck power declines in 2000s
http://www.coloradoan.com/article/20111226/NEWS01/112260317/Coloradans-paycheck-power-declines-2000s?odyssey=tab|topnews|text|FRONTPAGE
Coloradans who felt their paychecks weren’t going as far this past decade were right.
The state saw a 9 percent decline in household buying power since 2000, according to an I-News analysis of newly released U.S. Census Bureau survey data.
filed under:
Barking up the wrong tree.Weak SauceAn outright lie.
Got Air Jordans?
palmetto, is that you stepping on that persons head when they opened the doors?
Air Jordan 11 “Concord” Causes Riots Nationwide
http://hypebeast.com/2011/12/air-jordan-11-concord-release-causes-riots-nationwide/ - 117k
Sometimes I wonder if I was meant to be born in a different century.
This mass hysteria is totally ununderstandable to me. I can’t even get my head around it on an intellectual level.
I agree. I just do not understand this behavior. I have come to use the phrase “whom the Gods destroy, they first make mad” frequently as of late.
Indeed. When you think about it, what difference is there between the madness of the housing bubble and mobs going after Air Jordans? Sure, the housing bubble lasted longer and the process was different, but there was a certain madness about mobs of people grasping after houses and property, outbidding each other, falling for all the marketing, etc.
We experienced a bit of this madness when we sold our home at the top of the bubble. Before closing, the buyers brought relatives to see the property, they tramped all over the place, examining this and that. One of the people from the title company offered us $5,000 more than what we had contracted for and gave us tips how we could legally void the contract should we wish to take their deal. (no joke, that really happened). After closing, the buyers couldn’t shove us out fast enough. Very interesting experience. I’ve bought and sold five pieces of property over the years. This was by far the most interesting and somewhat frenzied experience I had.
Whoops, just remembered, actually the person who offered us an additionl $5,000 wasn’t from the title company, but from the office of someone who was assisting us with the legalities of the contract.
“After closing, the buyers couldn’t shove us out fast enough.”
Well to be honest, if I ever close on a house, I have every intention of shoving out the now-previous owners as soon as possible so that I can clean up after them.
I guess its for those who aint got nuttin in Life, but a pair of air jordans who hoo…
or i shop at the 99 store ’cause i gotta dress up to shop at walmart
“or i shop at the 99 store ’cause i gotta dress up to shop at walmart”
Go to Target and tell people you went to Tarjay.
“Sometimes I wonder if I was meant to be born in a different century.”
How about a different country?
From
Air Jordan 11 “Concord” Causes Riots Nationwide
Showing 90 comments
Firecrakka
Strolled in to footlocker 5hrs after they opened the doors.
Picked up my size 12. No crowd, no stress, no problem.
Ahhhhh, it’s good to live in Australia.
2 days ago 30 Likes
In 30 years, these same people will be engaging in demolition derby in their wheel chairs in order to get to the last box designer adult diapers.
FWIW, it was a non event out where I live. Then again we don’t get the pepper spraying, stampeding Black Friday yahoos out here either.
“Strolled in to footlocker 5hrs after they opened the doors.
Picked up my size 12. No crowd, no stress, no problem.”
But you’re still buying ridiculously overpriced sneakers.
For heaven’s sake alpha, do you really think it was sneakers they were after?
I have heard they are selling for $400 on Ebay. Once again, speculators are making profits.
And I have also heard that the previous version of this same shoe is now selling for thousands per pair. Is buy and hold a better strategy?
Can Australians sell stuff on ebay?
Sometimes I wonder if I was meant to be born in a different century.
This mass hysteria is totally ununderstandable to me. I can’t even get my head around it on an intellectual level
Got tulips
snake oil
religion
This game has been played through out time. Harness the same instinct that leads lemmings over the cliff and harness it for profits.
Perceptions:
Upper class: Mazaratti, penthouse living, Wall St income = get laid more than my peers
Middle class: House, fun toys, income enough for a few extras after the bills get paid = get laid more than my peers
Struggling class: one or two fad items that say I’m someone I’m not = get laid more than my peers
You see, pussycat. It’s really quite simple.
Then there’s the Pussycat reality. SIGH. It’s so tragic.
Cook fabulous meal daily. Eat in moderation. Listen to amazing music preferably while cooking but if not after that. Read plenty of books (preferably with a snifter of cognac.) Get laid daily with loving interested party.
Wow, I guess I don’t need the Maserati or the Central Park West penthouse after all.
Who could’ve thunk it?
“Get laid daily with loving interested party.”
Ha, only happens in the single-wide trailers.
And your problem with single-wide trailers on the Upper West Side would be?
“And your problem with single-wide trailers on the Upper West Side would be?”
No problem here with single-wide life; I was speaking from experience. Partying and getting laid every day gets old, and she was a rather ample, naughty type, but we weren’t going anywhere. The day would arrive when she would want a house in the suburbs and a minivan, and you what?…she’d get ‘em. I’d be the shell-shocked loser…”Whoa dude…that was totally not cool.” I gave her my savings and last paycheck, and we parted on good terms. Follow-up: she never went for the suburbs; a friend ran into her a couple of years ago, said she looked really run down, bad teeth, the works. Really unfortunate.
Are there single-wide trailers on the Upper West Side?
It was a joke.
It’s all good.
What if there was a huge one-day only sale of limited-edition classic Air-Jordans scheduled on the same day as the next election. Could such a distraction sway the results? Something worth trying?
Counter-idiocracy tactics might be worthy of consideration at this point.
Wonder if someone was expecting Air Jordans?
Police find 7 dead in Fort Worth-area apartment
Associated Press
Monday, December 26, 2011
GRAPEVINE, Texas — Seven people believed to be related had opened their Christmas gifts and started cleaning up the wrapping paper when they were shot to death in a suburban Fort Worth apartment, police said Sunday.
Authorities said they believe the shooter is among the dead, but got a warrant before doing a full search on the small chance that it was otherwise.
Four women and three men, age 18 to 60, were found in an adjoining kitchen and living room area when police entered the apartment around midday, said Grapevine police Sgt. Robert Eberling. Two handguns were found near the bodies in the apartment that was decorated for the holiday with a tree, he added.
“It appears they had just celebrated Christmas. They had opened their gifts,” he said
http://www.tampabay.com/incoming/police-find-7-dead-in-fort-worth-area-apartment/1207836 - 54k -
“Oh, there’s no place like home for the holidays…”
“Oh, there’s no place like home for the holidays…”
Did that yesterday.
Perry Como
There’s No Place Like / Home For The Holidays Lyrics
Well they`ve all got free homes for the holidays
‘Cause there`s no way their payin` back those loans
When you pine to live free for a thousand days
For the holidays you can’t beat a free home
I met a man who lives in Tennessee
He hasn`t paid in four
Pennsylvania where those Deadbeats make me cry
From Pennsylvania folks are squatin’ down
To Dixie’s sunny shore
From Atlantic to Pacific, gee,
The Deadbeats are horrific!
Yes they`ve all got free homes for the holidays
‘Cause there`s no way their payin` back those loans
And they`ve all paid no rent for a thousand days
For the holidays you can’t beat a free home
Happy Boxing Day/St Stephen’s Day to all - greetings from Europe. This is the first time I have read HBB for many months. I used to lurk pretty regularly here but have not had time to do so recently. I have seen many names come and go over the years, but what is most remarkable is the tenacity and staying power of the core of this brain trust.
This is the best forum in the world. The intelligence and civility of discourse here, along with the genuine respect and good will which exists between so many posters, is something I have never come across at any other blog (including a number of Christian blogs/forums I have frequented).
I will try to spend more time reading here in 2012 because I get so much out of it when I do. If I were in need of advice as a potential homeowner, this is the first place I would come for advice, support, and fellowship. I have seen the way the posters here help each other, and the trust and respect here is truly unique.
Thanks to all of you and Happy New Year!
Contrarian
I agree, incredible brain trust and mutual respect, even for the opposing viewpoints. We’re blessed to have found it. And we’re family. What a lovely expression of gratitude.
Realtors Are Liars®
Repubicans and Democrats are turds
Congress is poo
Voters are idiots
And so are you
This is especially hilarious after reading Contratian’s post about the quality of discourse here.
Occupy Kremlin
FT dot com
Last updated: December 26, 2011 5:49 am
Protesters pile pressure on Putin
By Charles Clover in Moscow
Tens of thousands rallied in downtown Moscow on Saturday, calling for a rerun of disputed parliamentary elections and the ouster of Vladimir Putin, prime minister, from power.
The turnout in the wintry streets appeared to exceed the roughly 50,000 crowd at a similar demonstration on December 10, which indicates that the anti-Kremlin mood – which began after the December 4 parliamentary elections – is gathering steam.
Exact estimates of the turnout diverged wildly. Movement organisers put the total attending at 120,000, while police put it at 29,000.
The spectre of increasing protests in the run-up to March presidential election has put Mr Putin’s political future in question. Just three months ago, when he and President Dmitry Medvedev announced they would switch jobs next year, most assumed Mr Putin would stay as president for two six-year terms.
…
Russia’s 1%ers don’t much care for protests, either:
FT dot com
December 23, 2011 5:39 pm
Russia’s rich get jitters amid fresh protest
By Catherine Belton in Moscow
Russia’s wealthiest are bracing themselves for increased political uncertainty as Moscow prepares for a second wave of mass protests this weekend against Vladimir Putin’s rule.
With tens of thousands expected to rally, bankers and economists say concern over growing cracks in Mr Putin’s regime is spurring capital flight. This could reach as much as $90bn for the whole year, with the rouble likely to come under continued pressure in 2012 amid expectations of oil price falls.
Russia’s hard currency reserves fell $13bn in the week that followed street protest two weeks ago over widespread allegations of ballot fraud in the December 4 parliamentary elections – the biggest weekly drop since January 2009 when the rouble was rapidly devaluing during the financial crisis.
…
Why the capital flight? The protestors are just a rabble of lazy bums who need to go out and get a job and I bet they’re pooping all over Red Square just like they did in Zucotti Park. They’re certainly not “producers,” and so they probably don’t contribute to Russia’s wealth. So why would investors pull their funds???
(yes I’m snarking. )
Later in the article, two reasons are given:
1) Fear among the wealthy of wealth confiscation;
2) Fear the Ruble will drop with the anticipated drop in oil prices.
I wrote below about the BRIC’s but it’s worth repeating.
I know at least one of the BRIC’s extremely well (not too hard to guess which one) to the point where I speak the language fluently and as has been told to me with only the “barest accent” (hard work!)
Their currency is at an all-time low. Not terribly surprising why.
I would not be long any assets in any of the four BRIC currencies. They are gonna get destroyed with the big bad-b1tch getting gang-raped like a cheerleader at a soused-up frat party.
Oh, and consequently exports are going to get a whole lot cheaper, and the trade deficit worse which is going to cause a lot of hand-wringing but it’s misguided, in my opinion.
Nice comparison Oxide, the US have become more and more alike, a small group of oligarchs controlling most of the wealth and all of the gov.
“(yes I’m snarking. )”
Be careful, I think The National Defense Authorization Act passed by the Senate this week could allow the US military to detain American citizens indefinitely for snarking.
What about, “snarking off ?”
FT dot com
December 22, 2011 8:34 pm
America’s inequality need not determine the future of Britain
By Martin Wolf
“The poor you will always have with you,” said Jesus. Despite vast rises in wealth, mainly over the last century, this remains true today because we define poverty relatively. Some object to this judgment: has destitution not disappeared from high-income countries and is it not diminishing in the developing world? The answer is: yes, although much poverty remains. But we are social animals. As stomachs fill, we wish to participate fully in our societies. But rising inequality is in the way.
As the US Congressional Budget Office noted in a fascinating recent study, for the 1 per cent of the population with the highest income, average real after-tax household income grew by 275 per cent between 1979 and 2007, reaching 17 per cent of the total. For the others in the top quintile of the distribution, average real after-tax household income grew by 65 per cent. For the 60 per cent in the middle (the 21st to 80th percentiles), the growth in average real after-tax household income was a little less than 40 per cent. For the bottom quintile, average real after-tax household income rose about 18 per cent. The Organisation for Economic Co-operation and Development states that “the wealthiest Americans have collected the bulk of the past three decades’ income gains”. Moreover, it notes, most of these gains accrued to executives and finance professionals.
…
Warren Buffett has argued that “there’s been class warfare going on for the last 20 years and my class has won.” The remark has not made him popular with his peers. But he was surely right.
We do not measure poverty relatively. Academics do, but the official U.S. poverty line (and the official poverty line of most countries) is an absolute line, not a relative one. The official poverty line is consequential, because many social programs are pegged to it, thus many government costs are pegged to it. Lest you think we have an overly generous welfare state, you should know that the official poverty lines in 2009 for the 48 contiguous states are:
Poverty line Persons in family
10,830 1
14,570 2
18,310 3
22,050 4
25,790 5
29,530 6
33,270 7
37,010 8
For families with more than 8 people add 3,740 for each additional person.
The second paragraph of the news report continues the obfuscation — it makes no sense to talk about people’s incomes in a discussion of poverty unless you also talk about costs of living. Once you adjust for cost of living, the lower 20 percent have had their resources crash, the middle 60 percent has been treading water for decades (with increasing desperation), and the top 20 percent are making out like bandits.
IAT
How does QE lead to lower bond yields? Other things equal, I would think printing more money would have the opposite effect, due to dilution of the value of existing currency.
FT dot com
December 23, 2011 9:02 pm
Gilt yields fall on double-dip fears
By Chris Giles, David Oakley and Claire Jones
The government’s benchmark long-term borrowing costs fell to their lowest level since the 1890s, reflecting investor fears that the economy is heading for a double-dip recession.
Weak figures for service sector output in October reinforced expectations of a bleak economic winter that have forced the Bank of England to keep interest rates at historic lows for much longer than seemed plausible earlier in the year.
Yields on 10-year government bonds, or gilts, fell to 1.99 per cent at one point before hitting 2.03 per cent at the close.
Yields, which have an inverse relationship with prices, have steadily fallen this year because of rising fears over the strength of the economy, the UK’s status as a haven outside the troubled eurozone and the Bank’s recourse to money printing operations, known as quantitative easing.
…
“Other things equal, I would think printing more money would have the opposite effect, due to dilution of the value of existing currency.”
You are ignoring the sanitizing effect of pulling roughly the same amount of assets out of the marketplace and moving them onto the Fed’s books. The net amount of cash+assets available in the market has not changed much, thus there is no massive change in the valuation of the cash. For the specific asset targetted, the percentage change of its representation in the marketplace is dramatically larger, so there is a much larger effect on pricing.
Other things are rarely equal.
Here’s how another crony-capitalist, centrally-planned economy is dealing with the problem of massive “stimulus” and speculative overbuilding: simply declare that borrowers are “deferring” loan payments. Yeah, that’s it, that’s the ticket - we’re “delaying” not defaulting.
http://www.chinadaily.com.cn/bizchina/2011-12/26/content_14326726.htm
Provincial borrowers defer loan payments
Hunan Provincial Expressway Construction Group is delaying payment on 3.11 billion yuan ($490.5 million) in interest, documents governing the securities show this month. Guangdong Provincial Communications Group Co, the second-largest debtor, is following suit. So are two others among the biggest 11 debtors, for a total of 30.16 billion yuan, according to bond prospectuses from 55 local authorities that have raised money in capital markets since the beginning of November.
As local governments delay payments for projects commissioned as part of the stimulus to ward off recession in 2009, less money is available for bank lending even as China is taking steps to inject more into the economy. The central bank has held interest rates at 6.56 percent since July to boost the economy, while the US Federal Reserve and the Bank of Japan have kept benchmark rates near zero since 2008.
“When companies start to roll over debt they’re not retiring debt, and banks aren’t retrieving their capital, so you’re crowding out new lending,” Patrick Chovanec, a professor at Tsinghua University in Beijing, said in a Dec 13 interview. “This is a problem that’s going to start to bite next year.”
There was a house that I was eyeing. I thought it was a little pricey, but it was far better quality than other overpriced houses in the same range. The house just went “pending” a couple days ago, after less than a month on the market (short sale). They never even put up a For Sale sign.
I thought we were supposed to be in a recession, and realtors were supposed to be struggling to make sales of any kind. There is a real estate mantra that there will always be another house, but there is just NO selection in this area. Anything that hasn’t been trashed by rental illegals or doesn’t have some dealbreaker flaw in the house is snapped up as if it were 2005. So much for my frugality and patience.
Patience, poindexter, patience.
You sound like someone in Japan circa 1993.
Do you have any recently-updated predictions for when the U.S. housing market will bottom out? (Maybe we need a New Year’s prediction thread some time soon?
)
Did we do a New Year’s prediction thread last year? If so, might be interesting to dig it up and review it, see if any predictions came to be.
Why does it even matter when it bottoms out?
As long as rents are below ITIM (interest, taxes, insurance and mortgage), you are being paid to rent.
Why mess with a good thing?
Almost everyone here has to be socking away a solid amount per month. If not, they should be doing it.
It bottoms when it bottoms, and it will both be obvious, and there will be no rush to buy since after a housing bottom, it stays flat for at least five years.
I would also like to point out that real-estate is local.
New York is going to bottom out a lot later than Kansas City which is going to bottom out a lot later than rural Alabama.
(For the uninitiated, the richest areas boom first and crash last. They give the illusion of holding out till the last minute and come down to earth with a big bang.)
For the professor, I am not familiar with San Diego (never even been there!) but I know California well, specifically the Bay Area and San Francisco. I visit often enough that I don’t even need a map to drive around.
That’s the problem with these games. You need to set the parameters in a narrow enough margin so that the predictions have a meaningful significance.
As long as rents are below ITIM (interest, taxes, insurance and mortgage), you are being paid to rent.
If I bought the above house at the offering price, I would be saving about $600/month by buying. And yes, that includes interest, taxes, and insurance. And lest you think I’m being extravagant by living in a townhome, and that I should downsize: If I bought the above house at the offering price, I would be paying almost exactly the same in PITI as the rent on a one-bedroom apartment. (admittedly, the one-bed apartment would be a little cheaper if I moved farther out.)
I do not anticipate a big crash in DC. At best, I expect a slow decline to 2000 prices, which were high even then. And by the time prices go that low, the houses will be trashed to the point where the fix-up will cancel out any price crash.
But you’d be taking on 30-year risk. Is $600 an adequate premium for that risk? I’d argue not.
Again, it seems like the bubbleistas are out in full force.
Party like it’s 2006, baby! Party on.
I’ve heard this argument for New York, and I’ve heard it for DC, and I’ve heard it for Mumbai (twice - I’m old enough to remember the previous bubble!), and I’ve heard it for Paris, and I remember having heard it for Tokyo too.
Yeah, keep telling yourself that.
Pacific Heights held out till 1994 and then crashed 50%.
Ooooooooops!!!!
So, securitization of mortgages started in earnest around 1977.
The real estate bubbles started building as the market around these securities grew. The first one popped with the S&L crisis around, what 1989. The government put in 300 billion and sent a few folks to jail and wound down several savings and loans.
The RE bubble reinflated during the 2000s and started to deflate around early 2006. The financial system seized up around September 2008. The difference this time was the government massively intervened to support the even larger market.
The Powers That Be want to save this securitization market. It’s a huge market. It’s a complex phenomenon (”So what the Fed loaned a bunch of organizations money. They got it all back with interest” - standard retort). It makes a lot of money for the people who keep the politicians in the manner to which they’re accustomed.
BUT - it keeps blowing up.Because it’s flawed at the core. Because it encourages everyone in the market to try and overstate the quality of the loans they’re buying and selling and taking out insurance on.
They might save it this time. Based on my bailout tracking, the government is officially out slightly less than 300 large this time around. This of course doesn’t count the stimulus. I don’t know if this is a full accounting.
If they do manage to save the broken debt markets again, well, then next time - another 10-20 years? That will be quite a sight to see.
According to Rosey’s Outlook last blog, (say it isn’t so)
The world’s greatest timing to buy real estate is not until higher taxes and interest rates have squeezed every once of value out of real estate.
and
Real estate values will cycle lower over time, well below what most people could every think is possible in probably a Japanese style deflation model. In some of the worst areas, you will see prices fall 80-90% from their peaks.
No date given, but I’ll still wager a buck on 2016.
I’m gonna miss Rosey’s.
“The house just went “pending” a couple days ago, after less than a month on the market (short sale). They never even put up a For Sale sign.”
I’ve noticed the same thing in the Phoenix area on Redfin’s website lately with middle-class homes in the $80-$100 per SQFT range.
rms, why are you scanning Phoenix listings? I thought you were in eastern WA—Moses Lake IIRC. Are you contemplating a move?
I’m looking at a second home purchase for two reasons: First, as a place to drop my savings after housing’s next leg down, but hopefully before t-notes tank. I’d buy energy shares, but I believe the markets are rigged in favor of the smartest, not savers. Second, I would like a place for my two children to live while attending college. I’m having serious doubts about San Luis Obispo, CA tanking fast enough to fit our family’s timeline. Phoenix is much closer to the bottom than most of metro California. Fingers crossed!
Interesting—thanks!
Here’s the C-S Index for the D.C. area for the last six months.
Apr 181.33
May 181.44
Jun 181.13
Jul 181.83
Aug 182.38
Sep 184.20
Looks like the first derivative is positive, and a lack of decent inventory suggests it will continue. Like I been tellin’ ya Oxide, buy now or be priced out forever (D.C. area only).
FT dot com
December 23, 2011 4:55 pm
Investors remain wary of equities
By Telis Demos, Michael Mackenzie and Dan McCrum
To the chagrin of equity market bulls, investors keep pumping money into low-yielding bond funds, a trend that began with the onset of the financial crisis in 2008 and shows no sign of reversing.
With Treasury bond yields near their lowest levels since the 1940s, it begs the question as to how long investors can prefer such meagre returns – particularly when many blue-chip companies pay higher dividend yields than their own corporate bonds.
…
Many investors clearly have no stomach for the volatile swings that have characterised equities in 2011. No end of eurozone debt problems and mixed economic data next year means the preservation of capital via owning bonds will continue.
“Low Treasury yields are a signal of fear and that is not good for equities,” says Thomas Forester, chief investment officer at Forester Capital Management.
…
A lot of cash on the sidelines is a good thing for equities. But if prices continue to trend up, watch out for a rapidly-inflating bubble as investors fear they’re being left behind and jump in. It’s only when every available dollar is already in the market that the crash is imminent.
Dec. 25, 2011, 6:47 p.m. EST
China, Japan strengthen financial, currency ties
By MarketWatch
–China, Japan pledged to strengthen bilateral financial cooperation, says China’s central bank
–China, Japan will facilitate the use of both currencies in cross-border settlements
–China will allow Japan to use yuan to conduct direct investment in the mainland
–Two countries will promote the development of a direct trading market between yuan and yen
…
It appears that Obama will ride a wave of labor market recovery into next November’s election. How will his Republican rivals attack him on the economic front if he turns the worst WWII recession, inherited from his Republican predecessor, into economic recovery?
Dec. 25, 2011, 9:00 a.m. EST
Jobless claims readings becoming tough to ignore
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) — While it is a bit of a stretch to say that economists are snug in their beds with visions of jobless claims dancing in their heads, there is no denying that they are growing more excited about the improvement in claims over the past month and will be focusing on that release in the holiday-shortened week.
“People are going to be focusing pretty heavily on claims,” said Josh Shapiro, chief U.S. economist at MFR Inc.
Claims have fallen by 40,000 over the past four weeks to a post-recession low of 364,000. After initial doubts when the decline started, many analysts are putting more weight on the down trend. See story about most recent jobless claims report.
“The claims drop is looking more authentic,” said Robert Brusca, chief economist at FAO Economics.
“One unexpectedly low number can easily be a fluke; two are interesting; three are telling us something real is happening in the labor market,” wrote Ian Shepherdson, chief economist at High Frequency Economics.
“It is safe to say there is a down trend of some sort underway,” Shapiro said. “How convincing it is remains to be seen.”
…
I thought people were saying this is due to all the temp workers hired to help during the holidays? Will they all get laid off early next year?
“…this is due to all the temp workers hired to help during the holidays…”
If you want to validate ‘what people were saying,’ you could check for a similar trend around the holidays last year. My recollection is foggy, but I don’t think it was there.
There is a good chance that the economy will be on the uptick by November 2012. Even structural recessions can have cycles.
And what percentage is people whose UE benefits have run out and now aren’t counted?
They also have to have stopped looking, although I don’t know how the BLS measures that.
I think the fact that you’ve not found a job during the time allowed, permits them to consider you as having stopped looking. In other words, when your time on UE runs out, you’re automatically counted as ‘not looking’. I think.
Not counted I think:
http://www.bls.gov/news.release/empsit.t15.htm
I think the sign of recovering for the economy business looking forward to Obama’s defeat.
A quiet Occupy Ogden Christmas
By Michael McFall
Standard-Examiner staff
Sun, 12/25/2011 - 11:43pm
Lauren Marietta (left) and Talan Wilhelm hang out at the Occupy Ogden campsite at the Unitarian Universalist Church of Ogden on 23rd Street. Supporters are camping in the snow but still decorated a Christmas tree. (MICHAEL McFALL/Standard-Examiner)
A black cat, Muffin, is one of the last regulars of the Occupy Ogden camp. (MICHAEL McFALL/Standard-Examiner)
There’s a donated Christmas tree in the center of the snowy Occupy Ogden camp. A few ball ornaments have “99%” written on them in black marker. Among the ornaments is a heart-shaped picture of a former Occupy Salt Lake member known as Mike, a homeless man whose death spurred the city into shutting that camp down. (MICHAEL McFALL/Standard-Examiner)
Talan Wilhelm hangs out at the Occupy Ogden campsite at the Unitarian Universalist Church of Ogden on 23rd Street. Supporters are camping in the snow but still decorated a Christmas tree. (MICHAEL McFALL/Standard-Examiner)
OGDEN — While the Occupy Ogden camp shrinks, life is starting to look up for its remaining members.
The camp used to sprawl along the whole northern side of the Unitarian Universalist Church of Ogden on 23rd Street, with at least two dozen members.
Now Talan Wilhelm and a black cat, Muffin, are the last regulars of the Occupy Ogden camp, though at least a dozen other people still help out in some capacity, such as planning or attending protests.
“It’s just me. It’s kinda quiet,” Wilhelm said while standing in the middle of seven tents set up for members who want to stay awhile.
But soon even he may not be sleeping in a tent each night as a regular at the northeast corner of the church.
Wilhelm might start a new job the first week of January as a trucker — which is what he did before he was unemployed and with the Occupy movement — if the employer chooses to hire him.
Beyond that point, the future of the camp is uncertain. But change is nothing new for an Occupy camp that has fluctuated in the two months since it started.
There’s a donated Christmas tree in the center of the snowy camp. A few ball ornaments have “99%” written on them in black marker.
Among the ornaments is a heart-shaped picture of a former Occupy Salt Lake member known as Mike, a homeless man whose death spurred the city into shutting that camp down.
At least a dozen of the protesters joined Occupy Ogden after police evicted them from Pioneer Park in Salt Lake City.
It was a large influx for the Ogden camp, which had started as only a handful of people and two cats, Muffin and Occupy.
…
Just say no to Christmas?
By Judy Keen, USA TODAY
Updated 3d 22h ago
Susan Lee, a divorced mother of three in New York City, is taking a drastic step this year. “No Christmas for me,” she says. “No gifts, no turkey, no tree, no kidding.”
Lee, 41, a marketing consultant, says she needs a break from the stress and spending that are integral parts of the holiday. Her kids will celebrate a traditional Christmas with their dad, but she’s ignoring all the rituals.
“I start dreading Christmas from the time the decorations go up in the stores,” she says. “It stopped being fun for me, so I’ll find out this year if I can do without it altogether. I think it will be a relief. It already is.”
…
Eh, she’s not so special. I’ve been doing that for years.
No Xmas celebration at all for you?
I see the Stratfor Group’s computer was gutted by some hackers. This was covered up until the money drain from the stolen credit cards passed the 6 figure level. I hope they publish the contents of the databases so we can see how these merchants of propaganda have guided our military and foreign policies. Back in the 1950’s there was the Rand Corp. that was used to do the same thing in Vietnam - the source of the Pentagon Papers. Imagine what foreign governments will do when they see detailed plans of how our military industrial complex plans to disrupt their economies or overthrow them. This is a huge disaster for the ruling class.
Wow, BlueStar, thanks for that interesting nugget. Wasn’t even on my radar.
Could you expand more on how this is a huge disaster for the ruling class? I’d like to think so, but “the ruling class” seems to have a pretty good knack for staving off disaster.
Will be interesting to see what they do to this event’s equivalent of Bradley Manning.
All the Manning stuff is historic rear-view mirror, this on the other hand is the detailed collaboration of the top 10% of industry and the government about current and future plans and techniques. I read somewhere it was a multi-gigabyte database so this could be a big deal.
Did they get the data and/or strategic plans? All I heard was that they grabbed some unencrypted credit card numbers and used them to give money to charities.
Here’s what looks like a sort of client list.
http://pastebin.com/8MtFze0s
So far, it’s only 2 things seemed to have happened: CCs were stolen and Anonymous is being blamed.
Forbes
Investing
12/19/2011 @ 12:41PM
China Housing Bubble Deflating; More Declines Seen In ‘12
The air is still being let out of the Chinese housing bubble, which produced record high housing prices in Shanghai over the last year.
An increasing number of Chinese cities saw falls in new home prices in November, the National Bureau of Statistics (NBS) reported over the weekend.
According to the NSB index of residential property prices in 70 tier 1 and tier 2 cities, prices fell in highly populated cities like Beijing, Shanghai, Guangzhou and Shenzhen to name a few. Year over year prices in those cities still remain higher.
In Shanghai, a survey by Soufun.com, a real estate website, found that 80% of home buyers expected prices to drop further next year, but more than half polled said that they would buy a house within that time period. Over the weekend, Star River, a luxury residential developer, said it was offering discounts at two of its projects in the city – 20% off apartments at the Pudong Star River in Huamu and 15% off properties at the Shanghai Star River – making it the first luxury home developer in Shanghai to launch a public price-cutting campaign, Shanghai Daily reported on Monday.
NBS data also showed that prices for existing homes dropped in 51 cities in November from a month earlier, 13 more than in October.
“NBS data also showed that prices for existing homes dropped in 51 cities in November from a month earlier, 13 more than in October.”
TIMBER!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
China struts ahead with swagger.
http://www.atimes.com/atimes/China/ML22Ad03.html
“Compared to the political chaos in Europe and the bare-knuckle presidential campaign now hitting full stride in America, the Chinese system seems a model of stability and civil discourse. Bo Xilai and Wang Yang - party bosses of sprawling southwestern Chongqing municipality and southern Guangdong province, respectively - are bitter rivals competing for a coveted seat on the all-powerful Politburo Standing Committee in the leadership change next year, but in public they offer nothing but compliments to one another.
In contrast, during the same week that Bo and Wang were clapping each other on the back in Beijing, seven Republican rivals for the US presidential nomination were, once again, tearing each other to pieces in a televised debate. But they also joined forces to rip President Barack Obama, a Democrat, to shreds before attacking one another. ”
Good read from Hong Kong.
No need to be nasty in public when the public has no say in what happens. Now I suspect that nasty rumors and bribes are flying from all corners behind closed doors. Politics is a contact sport even in China.
Brazil’s golden until 2017 because Brazil has “money to burn”.
Brazil Housing Market Booming ‘Til 2017
http://www.forbes.com/sites/kenrapoza/2011/12/14/brazil-housing-market-booming-til-2017/
Investors worried about an overheated Chinese housing market need only turn to Brazil. This real estate market has legs. And the recent five year real estate boom there has a good five more years before home values stop appreciating….
…..Housing prices have cooled in recent months, but are rising year over year. Interest rates are falling to single digits once again as inflation begins to ease on account of the global economic slowdown taking its toll on Brazil. That hasn’t stopped the fact that Brazil’s middle class is now the majority of the population for the first time ever and they have money to burn.
There’s more to Brazil’s real estate boom than the government low-income housing program My Home, My Life, which drives much of the market interest in names like Gafisa (GFA) and Cyrela Realty (CYRE3). Major private equity firms are investing in hospitality companies rumored to have A-list investors like Warren Buffett chasing them down for a possible stake. Shopping mall operators like BR Malls (BRML3) are raising capital in secondary offerings, and investors are oversubscribing to new issues.
So what’s with the 2017 deadline? Brazil’s building out for the 2104 FIFA World Cup. That’s soccer to non-soccer fans, and Brazil is building new stadiums, but also hotels and housing. In 2016, the Summer Olympics come to Rio de Janeiro. Oliveira at Patrimonial thinks demand for both housing and commercial properties will remain relatively high until things slow after those parties are over.
“There’s a psychological margin that Brazil real estate enjoys at the moment due to the oil discoveries off the coast of Rio, the World Cup and the Olympics, which makes Brazil very attractive to foreign investors at the moment. But after 2017 Brazil will still have its oil discoveries, but the World Cup and Olympics will be done with and foreign investment into Brazil will slow as a result,” Oliveira said, adding that the middle and lower classes would have spent more than 10 years acquiring properties and supply could outweigh demand by 2017.
All the BRIC’s are going to get burned to a crisp.
I would not be long assets in any of those four currencies.
All the BRIC’s are going to get burned to a crisp.
Why would Brazil get “burned to a crisp”? It is a “closed” economy relative to most other countries, it is an energy independent-net energy exporter and the world’s largest producer of many agriculture and mineral products. Brazil can feed itself and has a lot of fresh water. Almost 20% of its population has joined the middle-class the past 15 years and has many of the natural resources that the growing world needs.
And even if China get’s hammered Brazilian net exports to China will most likely continue to rise because the rate of increase in Brazilian exports to China is rising so fast that it would probably offset even China getting hammered.
The world is still growing and needs stuff that Brazil has.
“It’s never a bubble if you are personally invested in it.”
Keep believing, brother. Keep the faith alive!
I’d be very interesting in hearing a more detailed response, FPSS…
The key question in my mind is whether Brazil’s growth of its middle-class is related to the global credit-bubble, or not. If it is, then there is probably major pain ahead; if not, there may not be.
I honestly have no information on this, and thus no idea.
Keep believing, brother.
But none of the facts I mentioned above about Brazil are based on belief. The fact is, unlike most countries, Brazil has learned how to absorb blows, learn from them, make adjustments and keep on truckin’.
Global financial implosion? Brazils’ been there in 2008 with Brazil barely being scratched in GDP growth and Brazilian banks being lauded for their structure and reserve requirements.
Housing bubble trouble? Hmmmm. Total outstanding Brazilian mortgage debt equal to 5% of Brazil’s GDP compared to a 70% ratio in the USA. This is as to comparing apples to Brazil nuts.
Currency collapse? Yawn… Brazil’s done that 3 or 4 times between 1988-1999 with Brazil’s currency now being accepted as established.
Right-wing military dictatorship? Brazil tried it and decided in the mid-80’s that neither the people nor the military liked it.
Takeover by the socialists? LOL. See the last 2 Brazilian president’s party and compare their years in office with Brazil’s growth rate.
Another BRIC failing? Brazil lived through that with Russia about a decade back.
In many ways, Brazil stands alone among the BRICs.
Fine. It’s fair to ask for logic not a flippant quip (even though the latter may be perfectly accurate.)
So here goes.
There are two stories here. There’s a secular story about both Brazil and India having a major growth of its middle-class via globalization. This is alive and well.
There’s a secondary story that the bankers rushed in to offer these people credit which they happily went out and spent, and this is the bubble story.
Effectively, these people are entire naïve and they have bought the “how much a month” story a lot more effectively than anyone else. It’s the magnifying effect of leverage.
There is simply no other explanation for the valuations in Mumbai and São Paulo. If you believe that aparments in either abutting slums are worth more than Central Park West (and I live half a block from CPW) then I have a bridge that I want to sell you.
It’s the same bubble. Why can’t people see it for what it is?
(And for those whose income is dependent on these bubbles, I advise you to sock it away. It’s OK to take advantage in a party but the party will not last forever.)
There is simply no other explanation for the valuations in Mumbai and São Paulo….It’s the same bubble. Why can’t people see it for what it is?
Because it is not the “same bubble”. It might be a bubble but not the same type bubble when about over half of those São Paulo apartments are trading hands for CASH.
There’s a secular story about both Brazil and India having a major growth of its middle-class via globalization.
IDK about India but most of Brazil’s middle-class growth was probably not due to globalization. Most of Brazil’s middle-class growth was due to internal growth and the government’s investment into domestic programs to raise the plight of the poor.
the bankers rushed in to offer these people credit which they happily went out and spent, and this is the bubble story.
There is that in Brazil and there will be and is some pain however some growing pains need not always lead to “burning to a crisp”.
In many ways, Brazil stands alone among the BRICs.
Live like a Brazilian
http://themoscownews.com/russiawatch/20110614/188753054.html
When will Russian men live as long as Brazilian men? A Russian baby boy born today can expect to live 59 years and four months. That is two months longer than a baby boy born in Haiti.
By contrast, a boy born in Brazil can expect to enjoy almost an extra decade of life – for a total of 68 years and 11 months.
Twenty years after the collapse of the Soviet Union, Russia is now at the bottom of the BRICs, the economic group that includes Brazil, Russia, India and China.
…I was back in Brazil recently, after a 16 year absence.
That 16-year gap sharply highlighted how Brazil’s health indicators had leapt ahead, while Russian indicators had fallen back.
….Optimism has long been the cliche trait of Brazilians. Brazil is the country of the future – and (the joke went) always will be. But on my return to Brazil, I picked up something I had not heard of before: lots of Brazilians are moving back from the U.S. to Brazil, where they see more economic opportunity.
You sound like you have some ingots in the fire.
Me? I don’t care either way.
Keep justifying away. We’ve heard this total BS for a lot longer than you have.
I’ll stand by my statement. Brazil is gonna crash, and crash hard.
We’ve heard this total BS for a lot longer than you have.
But what do you base that on? How would you know?
Brazil is gonna crash, and crash hard.
But what do you base that on? How would you know?
I get paid to do that for a living. If I am wrong, I don’t get to eat so correctness is a bit of a religion for me.
What do you base your opinion on? Magical unicorn fantasies about “decoupling”, perhaps?
“This real estate market has legs. And the recent five year real estate boom there has a good five more years before home values stop appreciating….”
Similar quotes were used in the U.S. about five years ago, for example: ‘ “South Florida is working off of a totally new economic model than any of us have ever experienced in the past.” (Ron Shuffield) predicts that a limited supply of land coupled with demand from baby boomers and foreigners will prolong the boom indefinitely.’
As someone here points out on occasion (I paraphrase as I don’t remember the exact words), a bubble is usually recognized only after it pops.
I get paid to do that for a living…..What do you base your opinion on? Magical unicorn fantasies about “decoupling”, perhaps?
But I just listed about a dozen facts regarding Brazil that I base my opinion on.
If you equate about a dozen facts with unicorns I might question who pays you your living.
I’ll enjoy sh1tting on you when it comes true. I’m not a gracious winner. I enjoy rubbing it in.
Let’s just make a date for early-2013, shall we?
“Brazil is gonna crash, and crash hard.”
“But what do you base that on? How would you know?”
I met and talked with a painter who was from Brazil on a job on Palm Beach last month. Semmed like a nice guy and he was a good worker, but I was schocked when he said where he was from. I said I thought things were booming in Brazil, what are you doing here? He told me (and I have no way to know if this is true or not) that he was a computer programmer there but he did just as well here as a painter. He said there was a lot of money spent by the government but a lot of corruption and bribery went along with it. He said there were beautiful roads and other projects but they were falling apart 3 or 4 years after being completed. He thought Brazil`s economy was going to crash.
Once again, I have no idea if this dude knew what he was talking about or was telling the truth.
I’ll enjoy sh1tting on you when it comes true.
That’s really nice, and sweet too.
I’m not a gracious winner. I enjoy rubbing it in.
But you can’t win. The “argument” is already over. My investment in Brazil has already quadrupled and half of it has been realized. You know not of which you speak on this Brazil subject.
Oh goody!
And nobody here capitalized on the boom, of course. We’re all a buncha rubes and ret@rds, and we need you to educate us on how the game works.
Wow, just wow!
It’s like the good ol’ times all over again when, who was it again, that LA-chick beating me up?!? (There are archives, for the record!)
I’m looking forward to this bust with great glee.
I’m looking forward to this bust with great glee.
I’m glad you are looking forward to misery for millions to prove your point. That says something. Brazil will bust someday as all economies do however, as I pointed out, Brazil has great experience with busts and knows how to rub some dirt on it and walk it off. They will go down but rise quicker than most. Being energy independent and having the real potential to be the world’s largest food and natural resource producer tends to help as well.
It’s like the good ol’ times all over again when, who was it again, that LA-chick beating me up?!?
I’m just presenting facts. If anyone is “beating you up” I would say it’s you doing it to yourself with a total disregard of the facts presented, unforced errors and your peculiar desire to enjoy sh1tting on someone who’s facts you refuse to address.
Thanks much for the more detailed explanation, FPSS.
Your comments about the two different forces at work make good sense to me; what I don’t have is a good sense of how much of the societal change is debt-fueled, and thus most likely to be impacted by the downturn.
“If you believe that aparments in either abutting slums are worth more than Central Park West (and I live half a block from CPW) then I have a bridge that I want to sell you.”
Holy cow, I had no idea that apartments in Sao Paolo were priced that richly! Yikes! That alone certainly makes me think “unsustainable”—e.g. they should be able to be produced for FAR less than that, and thus eventually bring the prices more in line with incomes.
You also have to understand the specific geographies of the two cities (very different) to understand the problem.
São Paulo is a sprawl. It makes LA look localized. Of course, there are “fancy” neighborhoods, etc. but it’s a stretch to get from almost any part to the business district. (It resembles Manila, I might add.)
Mumbai is completely different. It’s a long and thin island like Manhattan which bulges and keeps bulging larger and larger at the North end. Hopefully, this characterizes this well and explains that just like Manhattan, all the train lines run “vertically”, and that there is a genuine premium attached to being near your workplace. (The analogy in Manhattan is that there is a premium attached to living near the key express stops.)
All of this is neither here nor there. The two mo-fo’s that I know quite well are gonna get their effin’ clock cleaned.
I had no idea that apartments in Sao Paolo were priced that richly! Yikes! That alone certainly makes me think “unsustainable”—e.g. they should be able to be produced for FAR less than that,
You have to understand Sao Paulo. It has more “rich” people than nice apartments. It could take you an entire day to drive across it in traffic. The ability to be close to one’s job is priceless and the fact that pricey apartments are located next to slums means little in Brazil. It’s a fact of life that will not change soon.
what I don’t have is a good sense of how much of the societal change is debt-fueled, and thus most likely to be impacted by the downturn.
Just a guess, I’d say roughly about 60% of which 20% of that might eventually be “bad debt” in a crash. But this is nothing compared to what Brazil has recovered from in the recent past.
It has more “rich” people than nice apartments.
Right. And New York has no rich people. They’re all living in the slums because that can’t actually handle getting a place to live (particularly on Central Park West.)
And all the São Paulo people pay in cash so that makes them immune to a bubble. If you pay in cash, there is no bubble. It’s the magic of cash.
Cash = No Bubble.
We’re all a buncha rubes and ret@rds, and São Paulo is immune.
Oh, crikey!
History is not gonna make this d00fus a happy camper!
New York has no rich people. They’re all living in the slums
Straw-man/false argument. I suggested no such thing.
We’re all a buncha rubes and ret@rds, and São Paulo is immune.
Double straw-man/false arguments. I suggested no such things. No place is “immune”.
Cash = No Bubble.
1/2 straw man. 1/2 of sales being in cash, mortgages only being available for the past 5 years and Brazil’s total mortgage debt equal to 5% of Brazilian GDP compared to USA’s ratio of 70% do not mean “no bubble” but would argue against a bubble.
A straw man is a component of an argument and is an informal fallacy based on misrepresentation of an opponent’s position.[1] To “attack a straw man” is to create the illusion of having refuted a proposition by replacing it with a superficially similar yet unequivalent proposition (the “straw man”), and refuting it, without ever having actually refuted the original position wiki
Waaaah, Waaaah, Waaaah!
Oh Financial Overlords, try not to rape this particular one (and if you do, I wanna watch and put it on Youtube!)
Rio,
I love you with all my heart, but when Pussy says he knows whereof he speaks (on this one, at least,) I’d listen to him and act accordingly.
I love you with all my heart, but when Pussy says he knows whereof he speaks (on this one, at least,) I’d listen to him and act accordingly.
Thank you, but your concern for me in conjunction with Pussycat’s “reasoning” on this subject is unwarranted for 3 reasons.
1. I’ve already realized and exceeded my profit expected in money and lifestyle on Brazil.
2. Pussycat has spoken nothing of value regarding the economics of the Brazilian housing market. I could make a better case against the Brazilian housing market myself in my sleep.
3. I don’t count Pussycat’s straw man arguments, personal insults or foul mouth pronouncements as anything requiring serious attention regarding the subject and especially in light of my points 1 and 2. But thank you.
1. conceded
2. conceded
3. conceded
Nonetheless.
A lot of speculation in the bucket yesterday re AWOL OWS…
found ‘em!
http://www.kob.com/article/stories/S2428255.shtml?cat=500
Believe me, it’s been very cold here, so maybe the NM contingent is just tougher than the coastal types. Or maybe the fact we stay drunk all winter makes us impervious to the weather!
I thought they all had headed to Ogden, UT — LOL!
Nothing like dodging a giant bullet to start off the week……
Left for work this am, temperature is 38 degrees. Started getting a light sprinkle on the turnpike east of Lawrence. Not enough to even bother turning on my Rain-X coated windshields. So far, so good.
Pass the Lawrence Service area, and come onto an innocuous little bridge about a mile east. No cop cars, but there are three wrecked cars and one in the ditch going eastbound past the bridge, plus a truck in the ditch; Two smashed cars going westbound on the west side of this…..so I slow down. Even slowed down to 30, and foot off the accelerator, the tail of the car twitches crossing the bridge. Check my in-car thermometer. 30 degrees. Great.
Come around a bend about 1.5 miles west of the Toll Plaza. More cars stopped around a longer bridge. As I’m watching, a giant white Cadillac going westbound hits the bridge at speed, immediately gets sideways, hits a half dozen cars before going in the ditch. Going eastbound there’s 3-4 cars on the shoulder past the bridge, but the bridge is still clear. Both me, and a guy/gal driving a newish 3-series BMW slow down to 25-30.
Second bridge is longer, and covered with a sheet of ice, but everybody seems to be navigating it okay About 2/3 of the way across, I glance in my rearview. Some a-hole in a blue GTO is coming up on the bridge doing 70 + mph. F###KKKK!!!!!
So, I floor it, even though I’m still on ice. Thank God for Traction Control and Electronic Stability. I brace for impact, and gain about a half car length on the BMW, which is enough…..the GTO hits the bridge doing about 65-70, immediately goes sideways, blasts the two cars immediately behind me, then the BMW beside me. BOOM. Hits the Bimmer a ton, right off my 1/4 panel, drives him into the concrete retaining wall.
Me? Not a scratch, although I pulled the car in the hangar, and checked the car over for shrapnel damage when I got to work.
The short version? I-70 between Lawrence and KC is going to be closed for a while. Fortunately, there aren’t many 18 wheelers on the road today.
Glad you’re OK.
Now I know why I loathe driving. Half a decade in Chicago will do that to you.
“Me? Not a scratch, although I pulled the car in the hangar, and checked the car over for shrapnel damage when I got to work.”
I thought you were going to say you pulled the car in the hangar, and checked something else when you got to work.
Me = The car.
For a few moments, the machine and I became one…….
“For a few moments, the machine and I became one……. ”
That`s why I thought a change of Fruit of the Looms might have been in order.
Maybe I’ve been desensitized by driving old Mopar A-bodies for 30 years.
In panic stops, they have a real bad habit of locking the right rear wheel. Which means, if you panic and hammer the brakes, you usually end up sideways. Happened at least a half dozen times at highway speeds. Never hit anything sold. Did lose the exhaust system one, when Granny didn’t see me; I locked them up, and flew into a ditch sideways.
Good old Mopars. how many time have you heard a story that starts with “Yeah me and my buddies got drunk one night back in the 70’s……..”
and ended with “……we rolled that Charger/Road Runner/Duster/Challenger/Cuda into a ball, but we all walked away…..”
Holy moly, X-gsfixr!
Wow. That sounds intense. I’m glad you’re ok…
I have driven on some sheets of ice safely in my past life in WI, and I never felt too unsafe doing so (except maybe that one ice-storm while driving thru Illinois).
But it never even occurred to me that the biggest danger in such a situation might well be the idiot behind you… Huh. Food for thought.
Just checked the Lawrence newspaper website…..
“Multiple cars with injuries……”
Everything was under control until the jackazzez in the white Caddy and the blue GTO showed up……..especially the guy in the “Neuvo Goat”
If I’d been thinking, I’d have gone ahead and let him blast me. I could use a new car. It’s amazing how accomidating insurance companies can be, when you get plowed into by one of their policy holders, and you refuse to sign the “Injury Waiver”.
(Back in the 70s, I was hit at an intersection by a drunk guy with full coverage. On New Year’s Eve. I did okay on that one.)
Of course, I’m sure he’s telling the cops he would have been okay, except for the fact that I had slowed down to 30-35 in the lane right in front of him. Yeah, knock yourself out. I’ve got enough speeding tickets to prove to the cops that I don’t slow down unless it’s absolutely necessary.
You probably should have turned on your hazard lights when you slowed down on the bridge, to alert drivers behind you that something was up. Might have gotten the GTO driver to look at you and realize he’s coming up on you too fast.
True. I got there probably less than a minute or two after the first wreck in the westbound lanes. Nobody had their hazards on.
I was in the left lane, just passing a line of 5 cars, the BMW being the first/leader. We were 1/4-less than 1/2 mile away when the white Caddy lost it in the oncoming lanes, and all six of us slowed down together. The Goat had gone around two of the cars in the right lane just as we were coming up on the bridge, and lost it as soon as he hit the bridge. I saw him coming before he lost it, and hammered the throttle.
As soon as he got sideways, he took out the two cars behind the BMW, and was still sliding. Only thing that saved me was the fact that he was sideways, drifting into the BMW, and I had a half car lead on the Bimmer, and was accelerating.
f I’d been thinking, I’d have gone ahead and let him blast me. I could use a new car.
Yea, but could you use a new van with wheelchair lift? Stuff happens. Glad you’re OK. I drove over those same bridges a couple times last September.
Yepper, that black ice will getya every time. Glad yer safe and sound, XG.
Had the same thing happen back in 1978-79.
Had a 340 Duster at the time. Left Tulsa heading up to KC. Chanute, KS is a little bit beyond the halfway point. It usually took me 3 hours to drive the 220 miles home, back in the day when US-169 didn’t have any bypasses around most of the towns (Do the math on my average speed).
Raining and 45 degrees when I left T-town. Rained all the way to Chanute. At the time, US-169, went thru Chanute. There was a traffic light on the south side of town. Got off the gas, and touched the brakes to start slowing down.
Nothing. In fact, I think it may have actually accelerated. Managed to get it stopped by light braking and downshifting (it had a 4-speed, and a Sure-Grip diff). When I stopped at the light, I opened the door to check the pavement. At least an inch of ice.
Took me 1.5 hours to drive the 110 miles to Chanute, and 4.5 hours to drive the 90 miles between Chanute and Johnson County. Could only manage 20-25mph. At least there were no other idiots on the road, besides myself.
I rear ended a car on a backroad near Cherokee, Iowa in about 1977. She was turning into a farmhouse drive. I was going about 25 when I hit the brakes to no avail. It was so slick there was no damage to either car. At that point, I decided it was the better part of valor to spend the night at a motel in Cherokee.
Good driving, X.
That’s why I think in-car thermometers are so important. The difference between 36 and 32 degrees can get you killed,but you’ll never perceive the difference inside your heated car, until you hit that black ice.
Unfortunately, my current car doesn’t have one.
The roads were just wet, except for the bridges. And it was just those two bridges, and another one a few miles east. The sun wasn’t high enough yet to warm the pavement, but the morning wind had started to blow in a little.
Those thermometers are a nice device to have. Once saw it drop 15 degrees in less than two miles. Went from raining moderately and wet pavement, to 5 inches of ice and frozen slush in less than a mile. Another thing it has is NOAA Weather Radio. If you are driving at night during tornado season, it’s a real nice thing to have. Can’t tell much difference between a run of the mill storm, and one with big hail and tornados, if you are driving on the highway at night.
Stability and traction control are the cat’s azz. One time, for grins, I turned it off during a fairly heavy rain out on the interstate. The car immediately became a handful. Twenty seconds of that was enough for me.
Glad you’re ok. Now that you mention it in MA they’ve got “Bridges Freeze Before Road” signs everywhere in MA. Don’t think I’ve ever seen one in NY. As I driver I always seemed to chant that to myself when the freezing rains hit. It was just auto pilot behavior after reading so many signs in a lifetime.
And along with the thermometer, it also has a aural warning/warning message on the info system, when it senses freezing temps.
Unfortunately, in this instance, the OAT was about 35.
In my last car which had a thermometer (VW), a little bell would sound and a snowflake would appear on the screen at around 35 or 36 degrees. Waiting until 32 to sound the alarm cuts it too close. Little dips and valleys can be several degrees cooler than the general outdoor temp- and that’s often where the bridges are, or the patches of road that don’t see much sun.
Thank goodness you made it OK, fixer. Hope the girl in the BMW was okay too.
In DC, there’s a saying that people don’t know how to drive on snow. That’s BS. They all know how. They just refuse to.
A black ice morning in Dallas back in the 80’s. An intersection of 4-lane surface streets. The light turns green for me but I look right and see a car coming that I know will not be able to stop. He was doing no more than 35, which was the speed limit. He hit the brakes, the rear end slid out, and he started pirouetting. I counted three full rotations before he hit the curb, bounced across the two lanes and hit the median curb, and eventually came to a stop, well past the intersection.
I backed up about a hundred feet, pulled into a spot in a strip mall parking lot, and walked the six blocks back home. Went to work that afternoon, after everything had melted.
Texans don’t know how to drive on wet pavement. They just don’t.
If you want to see something really funny, try watching a couple of pilots from Texas land and taxi an airplane on an inch of ice.
Bring a sack lunch. It’ll be an all-day deal.
I was living in Austin when they got an inch of snow. The entire town shut down- schools, stores, university, state government, everything.
Unaware I was in a catastrophic weather situation, I drove to work, to the amazement of the few there, who had all walked in, and who thought an inch of snow made driving impossible.
We just finished a ten day spell of freezing fog and black ice. Even the chicken wire mesh was covered in white crystals, but those FOR SALE signs everywhere were still legible through the ice. Trying to sell around here in the winter tells the potential buyers that you are desperate.
Oh man…not to take anything away from good decisions made by you…but you’re still unbelievably lucky :-).
Disgruntled reindeer joins Occupy Christmas movement, tramples presents
Video: Buck breaks into home for surprise Christmas visit
By Mike Anderson
December 25th, 2011 @ 9:05pm
SALT LAKE CITY — They were hoping for Santa and his reindeer but instead got a five-foot buck inside their house. It happened late Christmas Eve, and the family caught home video of the deer trampling over a pile of presents.
“When you’re waiting for Santa and his sleigh and his reindeer to come and land on your roof, and he comes through your basement window, we’re not gonna forget it,” said Casey Keller.
The Keller family thinks the buck tripped on a basement window-well and just couldn’t get himself out again.
They say he struggled in the master bedroom for a while, trampling over some furniture and running into a doorway. The room he ended up in was the one place where the family was keeping most of the Christmas presents.
Marla Keller was putting the kids to bed when the deer apparently tripped and fell into a basement window well.
“I heard crashing, I heard the window go,” said Marla Keller. “I looked down through the big window behind the Christmas tree, and couldn’t see anything. Then all of a sudden, I heard hooves - and antlers.”
…
And on Boxing Day too….(ya just can’t make this stuff up)
Brazilian economy ‘overtakes Britain’
(AFP) – 4 hours ago
LONDON — Brazil has overtaken Britain as the world’s sixth largest economy, a London-based research group said Monday.
In its latest World Economic League Table, the Centre for Economics and Business Research (CEBR) said Asian countries were moving up while European countries were slipping down.
CEBR chief executive Douglas McWilliams told BBC radio that Brazil’s advance was part of a wider trend.
“I think it’s part of the big economic change, where not only are we seeing a shift from the west to the east, but we’re also seeing that countries that produce vital commodities — food and energy and things like that — are doing very well and they’re gradually climbing up the economic league table,” he said.
You’d have to be borderline ret@rded to prefer Brazil over the UK.
While the UK has a motherlode of problems, at least they have Common Law (a.k.a. a functioning legal system.) You’d be hard pressed to say that about any of the BRIC countries.
Methinks that the BRIC-people think that capitalism is all fun and games. They don’t quite grasp the brick (sic) and mortar of the system.
You’d have to be borderline ret@rded to prefer Brazil over the UK.
I’ll make sure to tell all my British friends here that. Especially the one’s willingly paying thousands of pounds to get permanent Brazilian residency.
You have a chip on your shoulder! We’ll see how well it all works out circa Dec-2013.
Party on, Garth!
Don’t let the facts faze you.
You have a chip on your shoulder!
Since when does presenting a dozen macro economic facts on Brazil equate to a chip on one’s shoulder?
Since the time that you have an interest in the subject.
It’s like being a realtor. You get discounted on your “opinion” (worthless as it is) on real estate.
Analogously, ditto!
Q: Since when does presenting a dozen macro economic facts on Brazil equate to a chip on one’s shoulder?
A: Since the time that you have an interest in the subject.
But this does not really answer the question because the facts presented on Brazil stand by themselves regardless of the interest of the presenter.
Oh, crikey! May the universe have mercy on his bank account.
FPSS
What are the metrics that make you think Brazil will tank
Price to income
Rent to income
Dept to income or GDP
What specific problems does the legal system have?
Why do you pick a date in 2013.
Brazil certainly tumps Britain in terms of natural resources, and they have more and more tech and manufacturing, and I think the gov is better in some ways, ie concentrating on energy independence, growing the middle class.
GB has a more stable neighborhood and good relations with Europe and US and finacial institutions seem to like the place (tax policy, English, Time Zone)
I don’t have a stake in this just interested in the argument.
Brazil’s health is somewhat dependent on commodities, and a deflationary crash would hurt them, but then again it would hurt everyone.
Debt to income, specifically any form of sustainable income which simply doesn’t exist. (sound familiar?)
Debt to income, specifically any form of sustainable income which simply doesn’t exist. (sound familiar?)
Debt to income by USA realities of being “over housed” compared to debt to income of Brazil lacking 10 million housing units? Why would the ratio be equal in both countries?
Debt to income by USA standards of the middle-class shrinking compared to Brazil’s growing? Why would the ratio be equal in both countries?
Debt to income by USA standards of wages falling for most compared to Brazil where wages are rising? Why would the ratio be equal in both countries?
Here’s one thing I know after 22 years doing business with Brazil. A NYC financial analyst will NEVER understand Brazil by comparisons to American financial ratios and standards. Brilliant Brazilians can barely understand it let alone foreigners.
http://www.bloomberg.com/news/2011-12-21/if-ron-paul-wins-caucuses-iowa-will-be-loser-margaret-carlson.html
MSM propagandist Margaret Carlson adds her sucubus screech to the chorus denouncing Ron Paul, betraying the elites’ fear as he continues to rise in the polls as their annointed Hollow Man candidates fail to ignite any popular enthusiasm. As usual for an MSM bromide, the reader comments are far more enlightening and entertaining than the Pravda-like article itself. Enjoy!
It’s like the party days all over again!!!
Thank you, thank you, thank you, Rio and oxide, you have set my critical juices on fire one more time.
It truly is a magical Christmas. All my intellectual wishes have come true!!!!
“you have set my critical juices on fire one more time.”
Are you scheming up ways to short Brazil?
I missed shorting India (even though I kept telling my Indian buddy) but no matter since i go there in two weeks for a month. I get to enjoy the cheapest currency on record.
I’ve learnt the hard way not to short (although I do that regularly.) Why? The Central Banks are working against you.
It’s much more logical to pick up assets on the cheap.
The US is kinda different BTW. (hint: reserve currency - works differently.)
I always wonder. If I ran a mutual-fund, would anybody even invest? I’m too old-school and hard-core.
bad puddytat, bad! Now just see what you’ve done, you’ve ripped up all the nice upholstery. Retract those claws, yes, there’s a good kitty. Here’s some nice Fancy Feast for you!
PURRRRRRRRRR!
thank you, Rio and oxide, you have set my critical juices on fire one more time….All my intellectual wishes have come true!!!!
But I’m not seeing it. Please show the results of this by addressing my facts presented on Brazil’s being different than most countries.
1. Net exporter
2. Energy independent
3. Almost 20% of population joining middle-class.
4. Relatively closed economy with large manufacturing base
5. True potential to be the world’s largest food producer
6. Massive potential in natural resources
7. Universal health-care
8. Mortgage debt = 5% of GDP vs America’s 70%
9. Brazil’s current need for 10 million housing units
10. Many middle class Brazilians living with parents because of lack of housing.
11. Lack of flippers compared to USA even now.
12. Hot chicks who can cook.
13. Still a developing economy with much room to grow.
Brazil has an export-oriented economy. The main exports are transport equipment, iron ore, industrial raw materials, soybeans, footwear, coffee, autos, automotive parts, machinery. Brazil imports machinery, electrical and transport equipment, chemical products, automotive part and electronics. tradingeconomics dot com
Awesome, dude, awesome!!!
You are a total jenius (yeah, with the less-known “j” spelling.)
We are in awe.
Everyone, run out and buy a Brazilian condo now. Preferably, looking across the slums!
You are a total jenius…We are in awe…..I’m not a gracious winner. I enjoy rubbing it in.
Are you ever gracious Pussycat? In winning or losing?
I’m just awed. Particularly by reason 12. “Hot chicks who can cook.”
Jeebus, it can’t possibly be a bubble if the bleedin’ hot chicks can cook, can it now?
Oh crikey, the beyatches can cook, let’s just all buy real-estate while the going is good.
Madre de dios, the hot chicks can cook, let’s all run out and buy condos in Rio and São Paulo, let we all miss out.
Oh, I’m already in awe of the real estate. There can be no slow down now that the chicks can cook.
“Oh, I’m already in awe of the real estate. There can be no slow down now that the chicks can cook.”
Maybe that`s the problem in South Florida. Maybe these girls can`t cook. Then again, does it really matter?
http://www.miamidolphinscheerleaders.net/squad - 37k
I’m just awed. Particularly by reason 12. “Hot chicks who can cook.”
People say a good sense of humor is tied to the capacity it takes to discern humor. Sorry you didn’t get the #12 obvious joke.
try not to rape this particular one (and if you do, I wanna watch and put it on Youtube!)
Your foul mouth does not add to this discussion, does not enhance your reputation or your unsupported position.
LOL.
My reputation has done just fine so far.
My reputation has done just fine so far.
Maybe you do have a sense of humor after all.
What about corruption and cronyism?
That’ll leave a mark, every time.
(Brazilian) corruption and cronyism?…That’ll leave a mark, every time.
It does and it’s horrible. However it provides an area of definite potential improvement that (on the surface) seems to being addressed more than before.
Brazil: President Dilma’s anti-corruption drive
Tuesday, 13 September 2011 08:21 Jan Rocha
Five ministers have now left the government in nine months, four after being accused of corruption. But can the drive against corruption continue? Jan Rocha sends a special despatch for LAB from São Paulo.
‘What is worth more a poor citizen or a thieving politician?’ reads the banner at the march
BRAZILIANS PROTEST AT WIDESPREAD CORRUPTION
by Jan Rocha, LAB
São Paulo, September 12, 2011
While President Dilma Rousseff took the salute at the traditional military parade to celebrate Independence Day on 7th September, on the other side of Brasilia’s main avenue 30,000 demonstrators were marching to protest at the many scandals of fraud and corruption recently revealed, involving federal ministers, local governments and congress.
Phantom projects and non-existent public employees, roads and bridges that are never built, funds diverted from education and health to the projects of political allies, the use of public funds to pay for motels, private planes and trips overseas. Perhaps the most outrageous of all was the discovery that a number of first ladies in poor municipalities in Alagoas had diverted money destined for school meals to buy luxury goods. Instead of protein-enriched meals for the poorest children, the funds were buying whisky and perfume for the mayors’ wives.
Congress rebels
The trigger for the protests, which were repeated in other cities, was the decision of the national congress not to expel one of their members, federal deputy Jacqueline Roriz, for unethical behaviour, even though she had been secretly filmed accepting packets of money in exchange for favours from the government of Brasilia, for many years the fiefdom of her father, Joaquim Roriz. It seems that the deputies were being pragmatic: with so many of them also potentially facing corruption charges, they thought it wiser not to create a precedent.
Critical juices?
From what I can tell, you’re some kind of NYC analyst or trader speculating on the future of India and/or emerging markets. We’re all just OPM pawns in your little game.
Look, I’m simple. I have a very above-average education. After years of uncertainty, I finally landed a slightly above-middle class with job that I go to every day. All I want is a little house on a piece of land, somthing that hasn’t been trashed beyond repair, something within a half-hour drive of work, something cheaper than rentin, someplace where I don’t have to move every 2-3 years just so that the rent doesn’t take up 2/3 of my take-home pay. Even if I buy a house and the price drops 20% the next day, I will still be a bit ahead of renting. This isn’t a game for me. This is my life.
And yet, in American, even this simple act seems impossible. Unbelieveable.
And I want a white pony with rainbows shooting out of it’s ass. Preferably candy-colored rainbows.
Alas, we’ll just have to live with what reality gives us, shan’t we?
I’m not a big Ke$ha fan, but I quite enjoy this video, not the least reason being that the unicorns bleed rainbows then they get shot. That and James Van der Beek dancing out of time: http://www.youtube.com/watch?v=CFWX0hWCbng&ob=av2e
Yesterday I posted a gripe about Obama pulling a limousine liberal and sending his kids private school. Below is a response. So it’s a security risk for teachers and students in a public school but not a private school? Just face it Obama (like Hillary) thinks socialized medicine is good enough everyone in this country but won’t even allow the government to teach reading and writing to his kids.
All animals are equal, but some animals are more equal than others. Animal Farm, G. Orwell.
Comment by ahansen
2011-12-26 00:41:45
Or maybe sending the children of prominent public figures to public schools would present a profound security risk to the rest of the kids and teachers who go there?
Or maybe you’re just a simpleminded um, partisan?
The ire of Obama’s opponents to the private education of his children is akin to the ire of Democrats at the hypocrisy of family values Republicans that have been caught in the act.
It might be cheaper and safer to hire a tutor to come in than to send the kiddos to school with a Secret Service detail.
In the end, even parents who live in good school districts often send them to private school if they can afford to. For some, the student-teacher ratio is enough to justify it.
Socialized medicine or its cousin, single payer healthcare, is a completely different issue. In emergency medicine, there is no meaningful choice and, therefore, no opportunity for market forces to come into play.
Obama very much wants to turn public education on its side. He’s not that much different than a moderate Republican on education matters.
In fact, you could label his pro-charter position as somewhat TEA-ish.
Think hard here, Anon.
Obama’s kids have a far greater risk of kidnap or violent State-sponsored attack than children with less high-profile parents. Can you imagine the hue and cry if a city school came under terrorist attack because the Obamas had so irresponsibly sent their kids there? Or the screening nightmares every day when parents drop their kids off or pick them up? Too many unknowns and too many variables. But it makes a good talking point….
Schools that cater to diplomatic families and political figures (worldwide,) have extraordinary security protocols, locales, personnel, accommodations for private security, secure kitchen and bathroom facilities etc., that public schools (read local taxpayers,) simply could not afford.
Refer to the talk show brouhaha when the First Family takes a trip home to Hawaii. “Why don’t they just fly domestic coach and wait in line like everyone else?” Would YOU want to be on that plane or in that airport?
I sure wouldn’t.
“Records show the couple had financial problems and that their home, most recently valued on the county tax rolls at $336,200, had been sold in 2010 at a foreclosure auction.”
Texas police: Man in Santa suit killed 6 relatives
By DANNY ROBBINS The Associated Press
Updated: 4:56 p.m. Monday, Dec. 26, 2011
Posted: 3:06 a.m. Monday, Dec. 26, 2011
GRAPEVINE, Texas — Police in a quiet Fort Worth suburb worked Monday to piece together a family history after a man dressed in a Santa Claus suit apparently shot six relatives and himself on Christmas.
Grapevine police spokesman Sgt. Robert Eberling said the shooter showed up in the Santa outfit shortly before gunfire erupted and that the family appeared to have been opening Christmas presents. Police responding to a 911 call found four women and three men dead, along with two handguns.
“We think he was just inside there celebrating Christmas with the rest of them and decided for whatever reason that’s how he’s going to end things,” Eberling told The Associated Press.
Thomas Ehrlich, who lives near the home in Colleyville, told the AP he heard from neighbors that police went to the house Sunday. He said it was his understanding that the man and women who once lived there were estranged.
Records show the couple had financial problems and that their home, most recently valued on the county tax rolls at $336,200, had been sold in 2010 at a foreclosure auction.
Police and firefighters rushed to the Lincoln Vineyards complex about 11:30 a.m. Sunday after receiving a 911 call in which no one was on the other end of the line. Because no one responded on the phone, police went into the apartment, located at the back of the complex.
They found the seven, aged 18 to 60, dead.
Many of the nearby apartments are vacant, and police said no neighbors reported hearing anything on a quiet Christmas morning when many people were not around.
The apparent murder-suicide involved the first homicides in Grapevine in more than a year and a half.
Where’s the bottom?
Where’s the bottom?
Where’s the bottom?
Where’s the bottom?
Where’s the bottom?
WHERE’S THE BOTTOM? (sorry for yelling)
Where’s the bottom?
Where’s the bottom?
Look at her sexy bottom (pay attention stupid)
Where’s the bottom?
Where’s the bottom?
Where’s the bottom?
Where’s the bottom?
where’s the bottom (slowly fade , ad diminutivo)
Why focus on “her” bottom?
Maybe the chicks and the homos want to focus on “his” bottom.
I’m all for getting my bottom checked out given that I work hard to have a nice one.
I, for one, want some bloody compliments for all the work, dammit!!!
I for one have always been very complimentary of girls who work hard, even more so for girls who work hard to have a nice bottom. So kudos to you Miss Pussycat on your nice bottom.
Except that I happen to be a “him”, and I like my bottom. So do the girls.
lmao jethro.
Something tells me Puss is no bottom….
Have I walked into the twilight zone? Is it 2006 all over again, or am I the only @sshole to call out the Brazilian Wax, and the Oxide?(Ferrous or Ferric, either way he’s kinda grating and basically needs a good scrubbing)
It’s nice that the bubble-blowers are back. I missed them. Come back, combo, we need to team-tag again!!!
It’s nice that the bubble-blowers (Rio and Oxide) are back.
Pussycat,
You miss many points and you miss them repeatedly. Describing the vastly different Brazilian/housing/economic situation is much different than “blowing bubbles”.
If there is a bubble in Brazil, (a real possibility) it is not the same as in any other country for the reasons I described - and for the lack of historical financing alone. To equate India and Brazil on specific matters just because they are BRICs is intellectually lazy. One who “makes money” from such things should study and learn differences, causes and effects.
The NYC financial “masters of the universe” are lacking in many important areas of critical thinking. The economic situation in the USA caused by such is a classic proof of this fact.
Rio,
Critical thinking and insider info are two different animals. When they coincide, it’s wise to take heed.
To critically assess the veracity of the critically-thinking-long-term-trusted advisor as opposed to the ingratious expeller of inside information may, indeed, be fun.
In the end, the excrement (like Gingrich) seem to win -
how did ya spend your xmas? skiing or family dinner? i did both and it was great