The Housing Bubble

Joshua Tree Extension 2.0 available for download. New features:
* Firefox 9.0 support (should work up to FF 20 )
* Updated visual design to allow for faster page load/layout

Use the link under my name, or here: Download

I’ve been using it for a few days and haven’t run into any issues. Do let me know if y’all install it and run into a problem.

Why do I care about Iowa?

To see (twit) Newt Gingrich fall due to his arrogance and pride.

To see simple truth , honesty, and consistency be rewarded, as reflected in Ron Paul’s numbers.

To see Santorum rewarded for a solid platform devoid of pandering to Christian fundamentalists.

It’s all good. Let the games begin!

Let the media reap the benefits of unconstrained media buys by the PACs.

AP
“…The Montana Supreme Court restored the state’s century-old ban on direct spending by corporations on political candidates or committees in a ruling Friday that interest groups say bucks a high-profile U.S. Supreme Court decision granting political speech rights to corporations…

A group seeking to undo the Citizens United decision lauded the Montana high court, with its co-founder saying it was a “huge victory for democracy.”

Repeal will take a Constitutional Amendment ratified by 2/3 of the states, “…but With this ruling, the Montana Supreme Court now sets up the first test case for the U.S. Supreme Court to revisit its Citizens United decision, a decision which poses a direct and serious threat to our democracy,” John Bonifaz, of Free Speech For People, said in a statement.

-Matt Tabbai in Rolling Stone.

.

Nowhere to Go, Patients Linger in Hospitals, at a High Cost
NYTimes

Hundreds of patients have been languishing for months or even years in New York City hospitals, despite being well enough to be sent home or to nursing centers for less-expensive care, because they are illegal immigrants or lack sufficient insurance or appropriate housing.

As a result, hospitals are absorbing the bill for millions of dollars in unreimbursed expenses annually while the patients, trapped in bureaucratic limbo, are sometimes deprived of services that could be provided elsewhere at a small fraction of the cost.

“Many of those individuals no longer need that care, but because they have no resources and many have no family here, we, unfortunately, are caring for them in a much more expensive setting than necessary based on their clinical need,” said LaRay Brown, a senior vice president for the city’s Health and Hospitals Corporation. Under state law, public hospitals are not allowed to discharge patients to shelters or to the street.

Medicaid often pays for emergency care for illegal immigrants, but not for continuing care, and many hospitals in places with large concentrations of illegal immigrants, like Texas, California and Florida, face the quandary of where to send patients well enough to leave. Officials in New York City say they have many such patients who are draining money from the health system as the cost of keeping people in acute-care hospitals continues to escalate.

Five years ago, Yu Kang Fu, 58, who lived in Flushing, Queens, and was a cook at a Chinese restaurant in New Jersey, was dropped off by his boss at New York Downtown Hospital, a private institution in Manhattan, complaining of a severe headache. Mr. Yu was admitted to the intensive-care unit with a stroke.

Within days, he was well enough for hospital personnel to begin planning for his release, but as an illegal immigrant (he had overstayed a work visa a decade ago), he was ineligible for health benefits. And no nursing home or rehabilitation center would take him. Neither would his son in China nor the Chinese government, although the hospital volunteered to fly him there at its expense.

Mr. Yu remained in the hospital for over four years until he was transferred last spring to the Atlantis Rehabilitation and Residential Health Care Facility, a private center in Fort Greene, Brooklyn, after the federal government certified him as a “permanent resident under color of law,” essentially acknowledging that he could not be returned to China and qualifying him for medical benefits.

“This gentleman cost us millions of dollars,” said Jeffrey Menkes, the president of New York Downtown. “We try to provide physical, occupational therapy, but this is an acute-care hospital. This patient shouldn’t be here.”

Mr. Yu said that the hospital had treated him well, but that he had made enormous progress in regaining his ability to walk through his rehabilitation regimen at Atlantis. He hopes to return to China when he is well enough to be discharged.

“Here, I am very happy,” he said. “This is very nice — No. 1.”

Health professionals refer to them as “permanent patients,” trussed in red tape and essentially living in hospitals already operating on thin margins. In some cases, health care professionals say, grown children leave ailing parents at the hospitals and go on vacation. Officials call that practice a “pop drop.”

Though the problem is particularly severe in the municipal hospital system, longtime patients place a financial burden wherever they end up.

“It’s not the people who vote that count. It’s the people who count the votes that matter.”

Joseph Stalin

In my base search area 33458 there are 329 Listings Found. That`s down 130 - 150 from recent times and dropping like a rock.

All hail the Great Bernanke! HAMP, HARP, HOBO, Robo, Deadbeat, Wall Street, First time loan tryers, Mers, Mars, electric cars……

http://www.usadebtclock.com/ - 18k -

and the rent goes on……

Sounds like they’re battening down the hatches in the Middle Kingdom. Do they see a storm ahead?

China campaign cuts entertainment TV by two-thirds
BBCNews

Satellite broadcasters in China have cut entertainment TV by two-thirds following a government campaign, state news agency Xinhua has reported.

The number of entertainment shows aired during prime time each week has dropped to 38 from 126, said the watchdog.

The news came as the president warned of the influence of Western culture.

In the piece published in a Communist Party magazine, President Hu Jintao also urged efforts to boost the country’s own soft power, said Xinhua.

Satellite channels have started to broadcast programmes that promote traditional virtues and socialist core values,” SARFT said in a statement.

Breaking news: Those millions of dead bees we heard about several years ago weren’t raptured, they were turned into zombies.

http://news.yahoo.com/zombie-fly-parasite-killing-honeybees-230200867.html

This article is a month-and-a-half old, but it nonetheless seems to contribute plenty of gloom to the economic outlook for the New Year. All the monetary machinations in the world may fail to save the planet from the real economic consequences of an epic housing bubble.

Finance
Two views of the future
The markets will reveal which is right
Nov 17th 2011 | from The World In 2012 print edition

Somebody is going to be proved wrong in 2012 and will lose a lot of money. Either the bullion market or the Treasury bond market is mistaken about the long-term inflationary outlook.

By early September 2011, gold was trading at around $1,900 an ounce, an indication that investors felt inflation was set to soar. Such an outlook would normally be bad news for government-bond markets. But the ten-year Treasury bond was simultaneously yielding less than 2%, an indication that the “bond vigilantes” were far more concerned about deflation than inflation. Although the gold price fell and bond yields rose in October, the underlying contradiction didn’t disappear.

Such historically low bond yields might seem a very bad bargain indeed. But investors have the example of Japan to ponder. Many years of fiscal deficits, a high debt-to-GDP ratio, low interest rates and quantitative easing (QE): Japan has tried the lot without escaping from its economic doldrums. By September 2011 its ten-year bond yield had slipped below 1%.

If the rich world is following Japan’s template, equity markets are likely to have a rough 2012. A year in which Treasury bond yields stay at 2% or below would probably be one in which America at least flirted with recession. But equity investors are unlikely to be much happier if the gold bugs turn out to be right. Although shares may be a better hedge against inflation than government bonds, they are still prone to suffer if prices rise sharply, as they did in the 1970s. Equity valuations, as measured by the price-earnings ratio, tend to be highest when inflation is low and stable. Furthermore, a sharp rise in inflation would probably force the Federal Reserve to abandon its commitment to keep interest rates at their current low levels. That commitment is itself a sign of the Fed’s worries about the economic outlook.

Indeed, unlike 2008 or 2009, the equity markets may not get much of a hand from the authorities in 2012, since policymakers seem to have run out of ammunition. Interest rates are about as low as they can go, while debt-burdened governments are opting for austerity rather than further pump-priming. Europe’s travails weighed on investors’ minds throughout 2011, as politicians looked for a way to deal with the high debts incurred in Greece and other countries.

There is always the hope of further QE, with the central bank creating money to buy financial assets. But the policy has become controversial, with Texas’s governor, Rick Perry, a candidate for the Republican nomination for the American presidency, describing the idea as “almost treasonous”. Nor is it clear that previous rounds of QE did much to help the real economy.
…

http://market-ticker.org/akcs-www?post=200045

Analysts’ failure to foresee declining earnings per share for the biggest U.S. banks last year hasn’t stopped them from predicting an even bigger profit surge for 2012.

The six largest lenders, including JPMorgan Chase & Co. (JPM), Bank of America Corp. (BAC) and Goldman Sachs Group Inc. (GS), may post an average profit increase of 57 percent this year, according to 184 analysts’ estimates compiled by Bloomberg. A year ago, analysts predicted profit at the banks would climb 32 percent in 2011. Instead, earnings per share probably fell 18 percent as the economic recovery analysts counted on never took hold.

So we’re good for another year?

Newly Discovered Mayan Calendar Suggests One-Year Reprieve
Guatemala City British Community Connexion, Jan 2, 2012. Neelan Abercrombie

Guatemala City BCC: A recently unearthed Mayan calendar is giving end-of-the-world prognosticators new hope for at least a one-year extension of time. Previous versions of the Mayan calendar had pegged 2012 as the year the world ends or as known in the Spanish speaking academic world as the “Esta Mierda ha Terminado.” event. However the newly found calendar points to 2013 as the possible nellykracker.

The small, reddish colour, stone calendar is believed to come from the Late Classic Maya period of 600-900 AD where such type calendars were thought to have been given away by trading, political or religious entities to express thanks or engender goodwill towards patrons or supporters.

The calendar was discouvered in the Chimpiqua slum Bolas de la Mulas in 2008 by Eduardo “Fingers” De La Guardia. (pictured left in Lakers jumper) Of all things, Mr. De La Guardia was digging a privy hole in his front yard when his spade unearthed the calendar. (translated from Spanish) “I was digging a bloody hole for my loo in my front yard and I hit the thing with my spade” De La Guardia excitedly describes in a quiet monotone. “We didn’t know what it was but the size was good” adding that the calendar served as the privy hole cover for 2 years before being nicked in 2010. Eventually ending up in the Chimpiqua City Market, the calendar was re-discouvered in June 2011 by Chimpiqua history professor Juan Garcia “Buzz” Ortega. “I thought it was one of those head busting Frisbees used by the sierra gauchos. They play wild drinking games when away from their birds” Ortega explained with a toothy grin. “But then I noticed the Mayan characters in the centre and knew what it meant. I had discovered an authentic Calendero de Mayan….. I prayed to the Virgin of my country.” Buzz Ortega sobbed.

Although a very rare find in itself, the now famous Bolas de la Mulas Calendar soon proved to be quite different. On September 24, the tenth and final day of the Asno de los Cerdos holiday, Buzz Ortega and his neighbour and mate were using the calendar playing Perra, No lo Rompa the traditional, heads-or-tails drinking game played in the sand usually with the family’s best dinner plate. Both men disagree exactly when (being quite dillywompered at the time) but on about the 10th occasion the calendar landed upside down Mr. Ortega noticed faint markings on the back of the calendar. “I thought I’d turned barmy but it turned out to be 2013.” “Buzz” Ortega chortled, adding “Blimey! The bloody extra year! Just like modern calendars give us an extra month – my 2011 calendar lists January 2012 as a bonus. Well this is the 2013 Mayan calendar bonus. It is brilliant”!

But not only did the Bolas de la Mulas Calendar give the extra 2013-year, it was soon discovered that the extra year before the world began was included in the markings. Beginning as -00/-00/-01 this newly designated year might prove to be an even more important banger discovery in the years ahead. (If there are any) This is because scientists and historians have been at bollyknockers for decades on the organization of time before time existed. Indeed.

For historians, the calendar is the dog’s bollocks because the Bolas de la Mulas Calendar clearly indicates that months, days and years existed in structure even before they existed in reality. This has given the historians a smashing edge over the scientists in the debate going forward or at least until the now postponed 2013 “Esta Mierda ha Terminado.” event. An extra year for he world? Perhaps. A brilliant discovery for the world at large? Quite.

Postscript: The Bolas de la Mulas Calendar has been moved to the Guatemalan National University for further study. Eduardo “Fingers” De La Guardia has been given a duplicate of the Bolas de la Mulas Calendar along with a Guatemalan official Certificate of High Standing, Juan Garcia “Buzz” Ortega was named Chimpiqua middle-school 2011 teacher of the year and was awarded the Guatemalan National Medal of Substantial Things on December 12, 2011.

Neelan Abercrombie is an English haberdasher and tailor of bespoken suits in Guatemala City, the President of the Guatemala/Honduras English Culinary Assn., an avid cat lover and a frequent contributor of the Guatemala City British Community Connexion.

Bank of America short-sale incentives draw mixed reviews

By Kimberly Miller Palm Beach Post Staff Writer
Updated: 7:19 p.m. Sunday, Jan. 1, 2012
Posted: 6:18 p.m. Sunday, Jan. 1, 2012

COMMENTS

No clients have received incentives yet, 1 client in Tampa received a written offer. So, how many homeowners actually participatated? How many actually received the incentive? Mrs. Miller, I think you need to do a little deeper investigation and come up with figures. I think I will be one of the ones that ride it out, 41 months and my foreclosure was dismissed by the bank. I think I will be alright for another 24 months if not more.
diver4life
8:45 PM, 1/1/2012

Banks cannot prove they own the loan, so they are trying to Bribe the homeowner into submission. Facts are the Banks are losing at trial, not Summary Judgment when a good law firm defends the case. The banks deserve to lose, next time maybe they will follow the law and not try to commit fraud for a quick buck.
The Truth
8:13 PM, 1/1/2012

As I’ve posted before, we have not paid our mortgage in over 2 years and nothings been done about it. Our mortgage payment was over $2000 per month. Do the math. We have saved over $50,000 over the last 2 years. Cash is tucked away safely for our future use. We felt guilty at first but NOT ANYMORE. I would encourage everybody to do the same. Screw the bankers.
Free Ride
9:49 AM, 1/2/2012

@freeride

Great job !…get the word out to everyone, eventually those who bad mouth you, will see the light !….do not ever walk away, everyone must fight back and then we will win against the evil that caused this
javagold
12:13 PM, 1/2/2012

In the Financial Times, Alan Greenspan, the man who chaired the commission that jacked up payroll taxes on workers to “Save Social Security” in 1982 and claimed that the U.S. could afford huge income tax cuts for the wealthy in 2001 now says the U.S. cannot afford senior benefits. For younger generations.

But that’s fair, he implies, since the Baby Boomers were the most productive workers in U.S. history whereas those coming after are less deserving.

I would love a gander at this place…

None of the Chinese developers who built the vacation resort named Jackson Hole, in Hebei Province, had ever been to Wyoming.

“They absolutely fell in love with the idea of anything cowboy and Indian,” Smith said. “It just took off.”

The developers bought stock Western home plans from an architect in Oregon. Smith created an identity for each themed house within the 850-home development: Billy the Kid, Geronimo, Stagecoach Station, Betsy, Big Bear, etc.

Prospective buyers took the two-hour bus rides north of Beijing to see the site before signing contracts.

The homes in Jackson Hole, China, have sold out and nearly tripled in value since being built, Smith said.

http://www.jhnewsandguide.com/article.php?art_id=8100

Housing’s Huge Supply and Demand Imbalance
http://www.cnbc.com/id/45858675?__source=RSS*blog*&par=RSS
Ivy Zelman-now a bull and Laurie Goodman-the realist are quoted.

My impression that the North County San Diego real estate market was dead this year was not imaginary.

HOUSING: Fewest house sales in North County since 1991
By ERIC WOLFF ewolff@nctimes.com |
Posted: Saturday, December 31, 2011 8:00 pm

Century 21 real estate agent Jack Pope sits in a big office in Oceanside with empty desks Friday. Pope hopes that 2012 will be a better year for home sales. JAMIE SCOTT LYTLE | lytle@nctimes.com

North San Diego County will see fewer houses sold in 2011 than it has since 1991, according to a North County Times analysis of transactions from the San Diego County Assessor’s office.

That’s 12 percent fewer houses sold than in 2008, when house prices went into free fall, and just 81 sales more than in 1991, when financial havoc caused by the imploding savings and loan industry depressed house sales.

In Temecula and Murrieta, house sales were down 7 percent from 2010, but fared less poorly, according to the Southwest Riverside County Association of Realtors.

The real estate market found itself caught in a pincers of uncertainty among buyers and sellers: People who might wish to sell their homes lost too much value since they bought them, and many can’t pay off their loans; while people looking to buy a house struggle to get home loans from tight-fisted banks. The result has been the slowest year for house sales in two decades in North County.

“There’s two fence-sitters, the buyers and the sellers,” said Jack Pope, an Oceanside Realtor with 21 years in the business. “The buyers are sitting on the fence thinking it’s (the price) still going down; the sellers are waiting to be close to having some equity.”

With 2011 not quite completely on the books, North County projects to have 8,140 house sales by the end of the year, down 15 percent from 2010, according to a North County Times tally of house sales through November, and a projection for December.

San Diego County will see the same trend: The county reassessed 54,500 properties countywide because of change of ownership in 2011, fewer than in the past four years, themselves part of a housing bust, said Jeff Olson, division chief for the San Diego County Assessor.
…
Related Stories
HOUSING: Lack of move-up buyers holding back house prices
HOUSING: Unpredictable mortgage approvals frustrate buyers, drag down market
HOUSING: San Diego County homeowners deeper underwater, Riverside-San Bernardino improving
HOUSING: Prices collapsing in senior communities

Wouldn’t it be smarter for a prospective buyer to just keep renting until home prices reach a stable bottom, rather than trying to “win” a decent used home sale price from a deluded seller?

HOUSING: Berg: A house purchase is not a zero sum game
By ERIC WOLFF ewolff@nctimes.com | Posted: Thursday, December 29, 2011 11:30 am

Nearly every month, I hear from a real estate agent kvetching about how either prospective buyers will only take “smoking deals” or how sellers cling to prices above the norms of the market —- or both. In a recent blog post at her San Diego Home Blog, Rancho Bernardo Realtor Kris Berg says both sides need to stop trying to “win” a house purchase. She writes:

As a buyer, then, prices are what they are - today. That’s not to say that there isn’t room to negotiate. Of course there is. Depending on the seller’s needs and motivation, certain terms (like timing, financing and all those little contingency sticking points) may have value to the seller and may translate to a lower price. But it’s still not a zero sum game. There is give and take and, hopefully, a lot of what we call “dealing in good faith.” In most successful transactions, both parties ultimately benefit.

I see too many buyers playing to beat the seller instead of playing for a personal best. They take the asking price and offer 10 or 20% less, not because this seems like a fair price, but because it seems like a victory. Much like the sellers whose homes have languished on the market for too long, these buyers languish in the market for too long, firing too many blanks and missing too many opportunities.

Related Stories
HOUSING: San Diego County house prices down in October, Case-Shiller says
HOUSING: Local home prices decline with temperatures

There’s something happening here.
What it is ain’t exactly clear.
There’s Sarah with a gun over there,
Telling me I got to beware.
I think it’s time we stop, children, what’s that sound?
Everybody look what’s going down.

No posts for me today?

“Third banker pleads guilty in huge Sarasota flipping fraud case”

The banker’s last name is Bangasser. LOL!

http://www.heraldtribune.com/article/20120103/ARTICLE/120109903/2416/NEWS?Title=Third-banker-pleads-guilty-in-huge-Sarasota-flipping-fraud-case

Carl Morris…. I saw your response to my personal retirement plan. Hilarious dude!

Yes! 5-10% is “in the bag” because the poll says it’s different here.

http://www.brecorder.com/business-a-economy/single/672/189/1265583/

Brazil’s property bubble should avoid bursting in 2012, a Reuters poll showed on Friday, forecasting real estate prices in Latin America’s largest economy would increase modestly after years of stellar rises.

The poll of 15 banks, research groups and business associations, taken over the past week, downplayed the risk of a sharp downturn, with a recent credit boom underpinned by a steady improvement in wages and affordability conditions.

The rapidly expanding Brazilian middle class is expected to keep a close eye on opportunities to stop renting and move into ownership, holding up prices even after they almost doubled in some neighbourhoods.

“When the slums disappear and the Brazilian housing sector gets more mature, then prices will stop rising,” said Andre Perfeito, chief economist at Gradual Investimentos brokerage.

…”There are structural factors in place to justify such a strong performance”

Brazilian home prices should rise between 5 and 10 percent in 2012, according to nine of 14 forecasts in the Reuters poll, with one analyst saying there would be a lesser rise.

On a sadder note:

Michele Bachmann quits presidential race following poor showing in Iowa

AP WEST DES MOINES, Iowa–Michele Bachmann announced her exit from the presidential race Wednesday morning following a sixth-place finish in the first-in-the-nation caucus state of Iowa.

“Last night, the people of Iowa spoke with a very clear voice. And so I have decided to stand aside,” the Republican representative from Minnesota told reporters during a morning media availability here at the Marriott hotel.

Oh boy! Obama says Richard Cordray is going to make sure you can call your bank and make sure you are getting a fair shake on your mortgage. I look forward to more years of paying rent while those poor people who bought and refied in the bubble continue to live for free because of the evil Wall Street people who took advantage of them.

Singapore:

Did you know that more than half of Singapore’s population (of nearly 5 million people) falls within the world’s top 8.8% wealth bracket? The country’s average wealth per adult is nearly $300,000 (USD) and rising.

The Fed reports $7t was wiped off the value of U.S. housing (and btw, that is 35 times the $200bn to which subprime was supposed to be contained). With 114m or so households in the U.S., that equates to a rough home equity loss of $7,000,000,000,000 / 114,000,000 = $61,403.51 per U.S. household.

The truth lies somewhere in between these extremes, as many of the losses doubtless landed on investors who either held on to their properties or defaulted, dumping the loss on their lenders, after the housing bubble collapsed. Losses are also not uniformly distributed, with bigger losses landing on households located where real estate prices got a bit frothy.

Jan. 4, 2012, 2:00 p.m. EST
Fed may push for rentals of foreclosed homes
By Steve Goldstein

WASHINGTON (MarketWatch) - The Federal Reserve may push supervisors to accept banks and the government-owned mortgage buyers renting out the homes they own, according to a paper issued by the central bank setting out ways to improve the housing market. In a letter to the heads and ranking members of the House and Senate banking committees, Federal Reserve Chairman Ben Bernanke also said he would push banks and the big buyers of mortgages, Fannie Mae and Freddie Mac, to “find an appropriate balance between prudent lending and appropriate consumer protection, on the one hand, and not unduly restricting mortgage credit, on the other hand.” The paper on “the U.S. housing market: current conditions and policy considerations” seeks to provide a framework for considering the issues and tradeoffs in housing, at a time when prices have dropped about 33% from their 2006 peak, wiping off some $7 trillion of household wealth and hurting consumption.

No selling $helters to one another, no tossing bomb$ at invading “gangs” home countries, … what’s a MegaDefen$eIndustrialComplexInc. SCOTU$ person suppose to do?

What’s the matter with Kansas? (new POV)

Boeing to close Wichita facility by end of 2013, move tanker work to Texas, Okla., Wash.
AP – 2 hours 45 minutes ago

WICHITA, Kan. (AP) — The Boeing Co. has told its employees that it plans to close its massive defense plant in Wichita by the end of 2013 in a bid to cut costs in a tight market for defense spending.

Wednesday’s announcement means the loss of 2,100 well-paying jobs at its Kansas facility, which was once considered the centerpiece of Wichita’s claim as the air capital of the world.

It also dashes hopes for an additional 7,500 direct and indirect jobs that the company once promised to bring to Wichita with the Air Force air refueling tanker contract.

The work will move to Boeing facilities in Texas, Oklahoma and Washington.

Job reductions at the Wichita facility are scheduled to begin in the third quarter of 2012.

B-b-but isn’t this the agency that’s been backing most of the new mortgages the past 3-4 years?

“It’s highly likely that the FHA will need a taxpayer bailout over the next three to five years,” said Joseph Gyourko, a real estate professor at the University of Pennsylvania’s Wharton School and author of a report entitled “Is FHA the Next Big Housing Bailout?.”

http://money.cnn.com/2011/12/30/real_estate/federal_housing_bailout/index.htm?iid=HP_LN

Glad this has a good ending:

http://gma.yahoo.com/okla-woman-shoots-kills-intruder-911-operators-okay-091106413.html

We will all be living our retirement years in the Calif Desert. Its called the Slabs,and you can live for free, it has huge population !

guest James Rickards, the author of Currency Wars: says this slowdown will be significantly worse than most people think. He believes it will trigger a policy response from the United States that will likely lead to a third round of “quantitative easing” by the Fed.

Rickards thinks China’s economy could slow to a 3.5% growth rate. This doesn’t sound bad, but it would be a disaster relative to the 10% growth rate of the last few decades, and it is much more of slowdown than most analysts are looking for.

In response, Rickards says, the Chinese government would likely devalue China’s currency relative to the dollar, to help stimulate exports. This would counter Washington’s ongoing attempts to do the same thing. Rickards believes that the U.S. would respond with another round of quantitative easing designed to produce inflation, likely through a technique called “nominal GDP targeting.”

(Nominal GDP targeting would allow the Fed to explicitly focus on a target GDP growth rate that includes inflation, as opposed to trying to fight inflation by focusing on real GDP growth. Inflation would help the U.S. reduce the real burden of its massive debt load, and it might also make U.S. exports more competitive.)

A sharp China slowdown could also hammer Europe, which is already reeling from a banking and sovereign debt crisis.

finance.yahoo.com/blogs/daily-ticker/rickards-china-slowdown-worse-think-165205164.html

It’s a race to the bottom.
This will of course crush demand across the globe. Things people need will cost more but they won’t be making more money. Thus they will cut back on manufactured goods. This will create more unemployment and down we go.

The US will fare far better than China in this type of war. Why?
1. We have a lot of debt.
2. We export food and coal
3. We import a lot of manufactured goods produced in China.

This does not mean that things won’t suck here in the US of A they will just suck more in China.

My guess is trade wars will follow currency wars, once countries realize that the people are getting angry. Once the US has printed enough money to monetize the debt then they can pump some cash at the population and put up trade barriers. China will be sitting on a pile of worthless paper and won’t have access to any markets around the globe.

Headed to India for an epic trip.

Photography bag all packed.

Will try and drop in tomorrow (flight is in the evening.)

Check out my photo website (link above.) Might be able to update on the road but no promises are being made.

If not, see y’all all in February with plenty of tales about culinary adventures and derring-do!

The gradual return of the ~$300K house in suburban Boston. Another few years and at $250K or $225K I might bite. Getting closer to buying = renting.

http://www.realtor.com/realestateandhomes-detail/Arlington_MA_02474_M32640-20311

http://www.realtor.com/realestateandhomes-detail/Arlington_MA_02474_M35334-24400

If any of you take trips, and this is an entirely gratuitous post about packing but very useful, the important fact is that most of the space is taken up by the air between fabric.

I was taught that in entirely FPPS™ style by a friend of mine who came over before a trip (a long time ago), and opened the conversation with, “Dude, you suck!” when he saw my bag (and no wine had been consumed at that point.)

He then proceeded to re-pack my very neatly packed bag with one-third the space. There was literally blank space. Tons of it!

After that, I learnt. You roll the neatly folded “flat” stuff into tight precise rounds and lay them out in formation. (Scientists will recognize that crystal-packing is what’s being done.)

Apparently, there are also these vacuum-seals for clothes that need to stay ironed (suits, etc.) They sit flat at the bottom of the case.

Hope my experience helps someone!

Jan. 4, 2012, 12:01 a.m. EST
These high yielders look good for 2012
By Bill DeShurko

There’s a good reason why the term “liquidity” sometimes refers to money. Like a liquid, money will always flow to fill a void.

In 2012, there will be a lack of attractive voids where money can flow. The one big exception will be the U.S. Despite all of our troubles, to anyone sitting with a big pile of cash (particularly outside our borders), we have to look downright attractive. Picture yourself sitting almost anywhere in the world with a few hundred million to invest. Where would you put it?

China? China’s facing a slowing economy - slowing to a pace we envy, but slowing nonetheless. Slowing means wage stagflation, unemployment and unrest. Remember one big advantage of our political system is that when we don’t like our leaders, we have elections. In China, they have revolutions. I’d steer clear.

Emerging markets? Most emerging market economies revolve around commodities. Slowing global economies mean stagnant or falling commodity prices. No opportunity there.

Europe? Need anything be said?

The one global constant is that the printing presses will likely be running at full throttle to keep each economy afloat.

That leaves the world’s largest economy, with a stable political system (true, it may not seem that stable by November!) and a stock market full of modestly priced stocks of companies chock full of cash on their balance sheets, with modestly growing net earnings to add further to their coffers.
…

Latest from Charles Hugh Smith:

President Obama, Demopublican

President Obama’s signal accomplishments could easily have been signed into law by a moderate Republican.

The corporate Mainstream Media depends on ideological differences to generate “news” and advertising revenues, and the Status Quo depends on ideological differences to generate fear “of the other side” and enthusiasm “for our side.”

As the 2012 election season kicks off in earnest, we have to ask: exactly what is the difference between President Obama’s actual policies and those of centerist Republicans?

The president recently highlighted three centerpiece accomplishments of his supposedly rabidly Democratic administration:

1. Ending the war in Iraq

2. Ending the Armed Forces’ policy of “don’t ask, don’t tell”

3. Passing sickcare reform, oops, I mean “healthcare” reform

If we examine these supposedly tremendous accomplishments, we find that moderate Republicans were equally capable of passing such lukewarm reforms. The war in Iraq was deeply unpopular, acceptance of gays is increasingly mainstream, and healthcare reform had been on everyone’s agenda for years.

Anyone with the slightest grasp of American history could find equally “liberal” accomplishments in the administrations of Richard Nixon, Gerald Ford and even George Bush 1. Indeed, it could easily be argued that Obama ended the war far later than a moderate Republican might have, and that he caved into the sickcare Status Quo to such a degree that his “reform” essentially accomplishes nothing.

The hundreds of pages of reform boil down to a super-committee that is supposedly going to set prices and practices lower in the future. Meanwhile the program is at least 40% waste and fraud and continues growing at multiples of the underlying economy and tax revenues.

By any measure, this “reform” simply confirms the healthcare cartels remain firmly in charge.

On the other side the of the ledger, Obama continues the FUBAR war in Afghanistan, sacrificing American lives and treasure for political posturing, and he agreed (”with reservations”) to a congressional bill that gives the President unprecedented rights to impose “prolonged detention” on suspected terrorists and handing them to the U.S. Armed Forces, even as the military insists it has no interest or need in assuming such detention responsibilities.

Would a moderate Republican have agreed to gut the Bill of Rights with such tepid “reservations”?

It can be argued that Obama, visibly uncomfortable with members of the Armed Forces and fearful of being labeled “soft” on terrorism, has carved out an essentially fascist policy far to the right of even “rock-ribbed” Republicans.

From a more objective view stripped of phony ideological parsing, what exactly is the difference between Obama’s policies and those of moderate Republicans? We can get a better grasp on his Demopublican nature by asking a few key questions:

How many bloated weapons systems has he cancelled? (Zero)

How many overseas bases of the Empire has he closed? (none)

Who runs his financial policies? Wall Street cronies.

I think you get the idea here: there is literally no difference between Obama and a moderate Republican when it comes to the truly important policies governing the nation’s insolvent finances, its predatory financial sector, its corrupt and fraudulent sickcare system or its sprawling Empire.

Obama’s policies have all aided and abetted existing Status Quo cartels and fiefdoms. He has changed absolutely nothing of import except further eroding civil liberties.

President Obama can be charitably characterized as an ineffectual Demopublican. From those demanding more, then he can be accurately described as a well-meaning puppet of Wall Street and the rest of the Status Quo cartels and fiefdoms.

Longtime readers know I reject all the phony ideological “differences” between the two stooge parties; in reality, the differences are purely cosmetic and are exaggerated for propaganda and fund-raising purposes. Both stooge parties are in thrall to Wall Street and the financial sector, the sickcare cartels, etc., and both support a global Empire and endlessly rising public debt to finance their cronies. Both have consistently supported private profits while shifting monumental losses to the public. Both have consistently supported an out-of-control Federal Reserve. In every truly important way, the two stooge parties are merely two sides of the same Imperial coin.

Got giant snakes?

Giant non-native pythons spreading in Florida
By Elizabeth Weise, USA TODAY
Updated 9m ago

Giant Burmese pythons have already established themselves across thousands of square miles of Florida’s Everglades, where outdoor workers now routinely find them. The state had held out hope that bays, inlets and open seas would form a natural barrier, keeping the non-native snakes, often discarded pets, from spreading to the Florida Keys and beyond. But that might not be the case.

Research published this week finds that even newly-hatched pythons can survive in seawater for up to a month.

“The fact that this study has ruled out one of the most hoped-for forms of physical barriers, saltwater, as preventing the spread of invasive pythons in Florida puts even more onus on human action to prevent the spread of these damaging reptiles,” U.S. Geological Survey director Marcia McNutt said in a release. “This study demonstrates the distinct possibility that pythons could spread to new suitable habitats one estuary at a time.”
…

Get ready for more Fed-sponsored stealth bailouts of homemoaners and banks, which shift the costs of their foolish lending decisions to those who tried their best to avoid any housing bubble participation whatever.

The prudent must be punished to save greater fools from the financial fallout of their folly!

Financial Services
Fed’s Housing Fix Means Everyone Loses
By Shanthi Bharatwaj 01/04/12 - 04:06 PM EST

NEW YORK (TheStreet) — The Federal Reserve Chairman Ben Bernanke on Wednesday proposed policies that would force a recovery in housing, but cautioned that there was no single solution to the housing market’s problems and that everyone from investors to taxpayers would need to feel the pain.

In a 26-page white paper, the Fed outlined ways to ease some of the pressures afflicting the housing market.

While some of the weakness was due to weak labor market conditions and poor demand, policies that would address the excess inventory of foreclosed homes, borrower access to mortgage credit and inefficient foreclosure procedures should be considered, the central bank said.

Still, while policy action in these areas could facilitate the recovery of the housing market, “economic losses will remain, and these losses must ultimately be allocated among homeowners, lenders, guarantors, investors, and taxpayers,” the Fed cautioned.

Some of the proposals in the white paper have been discussed before, including one that looks at the conversion of foreclosed homes to rental units. “..The large inventory of foreclosed or surrendered properties is contributing to excess supply in the for-sale market, placing downward pressure on house prices and exacerbating the loss in aggregate housing wealth. At the same time, rental markets are strengthening in some areas of the country, reflecting in part a decline in the homeownership rate,” the paper noted.

“Reducing some of the barriers to converting foreclosed properties to rental units will help redeploy the existing stock of houses in a more efficient way. Such conversions might also increase lenders’ eventual recoveries on foreclosed and surrendered properties.”
…

I’m heartened that at least some top economists learned valuable lessons from the housing bubble’s collapse.

September 8, 2009, 2:00 pm
What We’ve Learned: Ugly Truths About Housing
By EDWARD L. GLAESER
A broken Shannon Stapleton/Reuters A broken “For Sale” sign outside a home in Queens, N.Y.
Today’s Economist

With the anniversary of the failure of Lehman Brothers approaching, we asked each of our Daily Economists to explain what we’ve learned from the financial crisis. Here Edward L. Glaeser, an economics professor at Harvard, responds. Find the rest of the series here.

One year ago, Lehman Brothers fell and our financial markets teetered at the brink of a precipice. This event looms large in global finance, but it appears less momentous from the perspective of the housing markets.

Housing prices peaked not 12 but 40 months ago in May 2006. After experiencing a staggering 96 nominal percent price increase during the six years before then (72 percent in real dollars), prices started a slow decline. By September 2008, prices had already dropped 22 percent from the peak. Of course, they fell another 12 percent in the six months after Lehman collapsed.

What have we learned from the great housing bubble and crash of the aughts? Most obviously, we have learned that housing prices can be extraordinary volatile. This was less obvious from previous housing cycles.

During the last housing cycle, from 1987 to 1993, the Case-Shiller 10-city index increased by 31 percent between January 1987 (when Case-Shiller data starts) and the peak in March 1990. During the 38-month period before the more recent peak, the 10-city index increased by 55 percent.

But during the recent period, five metropolitan areas (out of 20) experienced price growth above 75 percent; no city experienced such a massive boom during the earlier cycle.

After the earlier peak, the market fell for 42 months before bottoming, with the 10-city decline at about 8 percent in nominal terms, which was closer to 20 percent in real terms. While there are no guarantees against further declines, national housing prices seemed to stop falling in May 2009, exactly three years after the more recent peak. In the current decline, housing prices dropped by 33 percent in nominal terms, or perhaps 38 percent in real terms. A 24 percentage point larger nominal rise in the recent boom was associated with a 25 percentage point greater nominal fall.

So let no one ever again say foolish things like housing prices never fall.
…

WSJ dot com
U.S. NEWS
JANUARY 5, 2012

Apartment-Vacancy Rate Tumbles to 2001 Leve
BY DAWN WOTAPKA

The nation’s apartment-vacancy rate in the fourth quarter fell to its lowest level since late 2001 as Americans continued to favor renting homes instead of buying them.

Rents climbed, but data firm Reis Inc. said the increase was less than expected. Landlords of properties intended for lower-income renters found it more difficult to raise prices, according to Reis.

Multifamily property has been the star of the real-estate sector for more than a year, generating profits for landlords but headaches for renters struggling with the economic downturn. Demand has swelled from people being foreclosed out of their houses…