Bits Bucket for March 17, 2012
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.
About Me
Name:Ben Jones
Location:Northern Arizona, United States
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Happy St. Patrick’s Day, HBBers!
Well eyes headed down to celebrate St. Patricia day with me girls. Come on by and let’s have PD Eastman book $igning.
http://www thegreengirlsaloon com/
I did not know a well can have eyes…What type of language are you speaking?
Erin go Bragh!
Earlier this week, one of the posters stated that most here on the HBB are in the “anger” stage.
That’s my opinion as well.
Particularly PB, RAL, and to a moderate extent, our dear ringmaster, Ben.
Let’s be precise. The game has been extraordinarily well-played, and will continue to be well-played.
I don’t like it any more than you do.
However, these are choices. If you can influence it, go for it! (I’m quite sure I can’t.) If you can’t, then learn from it and move on.
What else is there?
PS :- The educational importance of what takes place here is “off the charts”. Perhaps that’s the “value” proposition?
Earlier this week, one of the posters stated that most here on the HBB are in the “anger” stage.
What about posters who are in the “condescension” stage? Any advice for them?
Schadenfreude rocks?!?
Don’t be drinkin’ any o’ that green beer!
Oh, wow. Just realized today is it.
Definitely not a good idea to pass through either Times Square or Grand Central today!
And the Irish bar around the corner will be full of pukers.
“And the Irish bar around the corner will be full of pukers.”
Happy St. Amateur’s Day!
Dude, they are B&T (”bridge and tunnel”).
I had the misfortune of passing through Grand Central on St. Paddy’s Day two years ago at 7:30am. Never before have I seen so many completely-and-utterly sloshed people. It’s not a pretty sight!
7:30am?????????????? Sloshed?
You can’t make this stuff up.
Did I mention that it was a Wednesday?
Which means it’ll be worse today, on account of it’s a Saturday. And unfortunately I have to spend a brief bit of time on the road today.
I was behind somebody weaving all over the place on I-95 shortly after midnight last night. I guess he was getting an early start. And I STAYED behind him because I wanted to keep an eye on him to stay out of his way.
The cheese is always moving. Go find it. No one is going to hand you a free house. There is always a price to pay.
Where’s Sammy?
“The game has been extraordinarily well-played, and will continue to be well-played.”
What game, and who played it so well? And who is winning it: Great vampire squids, muppets, The Bernanke, or somebody else?
Ryan Mac, Forbes Staff
I cover the world’s billionaires for the rest of the 99.9999999%.
3/14/2012 @ 6:53PM
Two Billionaires Side With Greg Smith Against Goldman
After resigning from Goldman Sachs with guns blazing and ink burning, former executive Greg Smith can guarantee there will be no love lost for him on Wall Street. Smith, who published a widely-discussed op-ed in Wednesday morning’s New York Times, has been mocked and doubted.
Two of Smith’s supporters, however, are among the world’s wealthiest: billionaires Jim Clark and Stephen Jarislowsky.
Clark, who re-joined this year’s Forbes Billionaires List after dropping off for three years, tells me via email that Smith’s criticism of Goldman’s treatment of its customers is “what I experienced over the four to five years” he entrusted some of his funds with the firm’s private wealth management division.
Smith, a former executive director and head of the Goldman’s U.S. equity derivatives business in Europe, the Middle East and Africa, wrote in his op-ed: “Over the last 12 months I have seen five different managing directors refer to their own clients as ‘muppets,’ sometimes over internal e-mail.”
…
I’d take anything a billionaire says with a mountain of salt.
They probably have their own axe to grind against GS.
In general, I’d take anything anyone says to the media with a sackful of salt.
You can’t possibly be this naive!
“You can’t possibly be this naive!”
Entertainment, dude: Focus!
This Clark guy used to turn his money over to Goldman for handling and was charged a 1.5 percent annual fee for doing so. Then Goldman would turn over the guy’s money to hedge funds who in turn would extact a 2 percent handling fee
plus 20 percent of the profits.
Those are some mighty hefty fees.
But such fees could have easily been absorbed in the eight-percent-return-world that we used to live in a few years back, but they can’t be absorbed anymore because these eight-percent-plus returns are not there anymore.
This means the financial-types - the money managers - are screwed. They just don’t know it yet (well, maybe some of them do).
The hedge funds that were charging 2/20 when the rest of the world could make 8% and more in index funds weren’t making anything like 8%. Check out the returns on Yale’s endowment and then remember that they only put a portion of their capital in hedge funds.
“…money managers - are screwed.”
You know they f’d up when my relatively neglected portfolio did better last year than some of theirs did.
Key difference: I own very little RE, and what I own is only through REITs.
P.S. Can anyone suggest a portfolio which is expected to earn 7.5 percent in the present investing environment?
March 14, 2012 1:40 PM
CalPERS lowers forecast for investment returns
SACRAMENTO, Calif. — The nation’s largest public pension fund voted Wednesday to lower its estimate for annual investment returns, meaning it will need more money from the state, school districts and local governments to maintain its ability to fund promised retirement benefits.
The board of the California Public Employees’ Retirement System voted to lower the fund’s estimated rate of return from 7.75 percent to 7.5 percent.
Representatives of local agencies said they were concerned the move will further hurt their budgets at a time when many are facing deficits and have had years of cutbacks.
The move by the board will require an extra $303 million a year from the state, of which about $167 million would come from the general fund.
CalPERS’ chief actuary previously recommended lowering the assumed annual investment return even more, from 7.75 percent to 7.25 percent, citing the risk to taxpayers in the future. But the fund’s pension and health benefits committee on Tuesday voted 6-2 to ignore the advice and went with the higher estimate, meaning local governments will not have to contribute as much as they otherwise would have.
…
Need a 7.5% return? I recommend a diversified mix of Italian, Spanish and Portuguese bonds.
You know they f’d up when my relatively neglected portfolio did better last year than some of theirs did.
Care to share what your portfolio mix looked like?
“Care to share what your portfolio mix looked like?”
I bought and sold stocks; the main trick was to figure out that Congress was going to crash the market last August, and stand clear while they did so.
These guys f’d up big time.
Distressed Sales Volume Remains at Elevated Levels Despite Big Boost in Non-Distressed Sales in Recovering Economy
2012 Could Match $21 Billion in Distressed CRE Property Sales Last Year — But It Hasn’t Proved To Be Easy Money
By Mark Heschmeyer
March 14, 2012
Distressed trading volume has stabilized but continues to remain at elevated levels, increasing by approximately 2% last year over 2010. However, a surge in non-distressed property trading driven by improving economic conditions has begun to mitigate its impact on commercial real estate pricing levels overall.
…
For its year ended June 30, 2011, the California Public Employees Retirement System (CalPERS), the country’s largest public pension fund, reported negative returns from its value added portfolio over the last 10 years - with the 10-year performance coming in at a negative 7.1%. It has posted a negative 20% return over the last three years.
According to Pension Consulting Alliance Inc., one of CalPERS investment advisors, the value add returns have hindered CalPERS overall real estate investment returns. The fund has had 3-year and 5-year overall real estate returns of negative 17.8% and negative 13.2% respectively. For the last 10 years, it has posted an overall positive, though insignificant 1.6% return.
“The performance of the real estate portfolio has been hindered by three primary factors: significant amounts of CalPERS’ capital were invested during the 2005 to 2007 period, which exposed the portfolio to the risk of vintage-year concentration; the high proportion of the portfolio invested for capital appreciation (not current income) in riskier, non-stabilized properties; and high amounts of leverage employed at the peak of the cycle,” PCA reported.
…
What kind of dummies would have bought so much real estate at the all-time high? But then again, I guess they managed to get paid for their actions, so perhaps they aren’t as dumb as they seem looking in from the outside…
I’m in the surrender stage; It is what it is and I can’t change it.
But maybe I can understand a bit of it and make part of it work to my advantage.
BTW, I’m watching as droves of skilled co-workers leave for retirement this month and next. This’ll make skilled employees who choose to remain - such as myself - all the more valuable.
‘Perhaps that’s the “value” proposition?’
Can’t speak to others’ motivations (as you have), but so far as I am concerned, this blog opened my eyes to the entertainment value of high finance. I had no idea about this until the merry gang of HBB posters helped to open my eyes.
Stripping Protesters Arrested at Bank of America
Submitted by Code Pink on Mar 12, 2012
By Medea Benjamin
“Stripping Protestors In Pink Bras Crashed Bank Of America CEO Brian Moynihan’s Speech,” declared Business Insider on March 8, showing Moynihan’s stern photo with a pink bra playfully dangling in the air beside him.
It’s true, things did get a bit wild at Citi’s Financial Services conference at New York’s Waldorf Astoria when Brian Moynihan got on stage and began flipping through his tedious powerpoint.
While the hotel security was busy watching anti-bank protesters rallying outside, CODEPINK cofounder Jodie Evans, dressed in a hot pink bustier, burst into the conference room. “Bust up Bank of America before it busts up America”, she shouted, before being hauled out by security guards. “As I was saying,” continued a deadpan Moynihan to the laughter of the crowd, returning to the dreary slides that tried to put a rosy spin on this dinosaur of a company whose share price has plummeted while it continues to foreclose on families’ homes and faces tens of billions of dollars in damages from lawsuits over mortgage investments.
Little did Moynihan know that the excitement at what is normally a bankers’ snoozefest had just begun. CODEPINK codirector Rae Abileah and I were already seated in the front of the room. Wearing dark business suits, we did our best to blend into the crowd of stodgy white men in black business suits.
While Moynihan was bragging that Bank of America ended 2011 with the most capital, liquidity and reserves ever in its history, I calmly walked on stage and began to disrobe while Rae deftly jumped on a table in front of the stage. As we shed our jackets and shirts, the startled CEO suddenly found himself flanked by women in pink bras, with Bust up B of A scrawled on our chests.
…
Excellent! Most Excellent! Eyes love$ it!
Tank$ green-shootist!
If you can’t, then learn from it and move on.
I’m still trying to figure out exactly what I should learn. I’ve already learned that money is “squishy” in a way I didn’t understand before. Kind of like moving from Newtonian physics to relativity requires an understanding that time is “squishy” rather than absolute.
But I still can’t figure out if central banks can use that squishiness to make it do ANYTHING they want. It doesn’t make sense to me and it seems like there is a risk of production stopping and the whole house of cards falling apart, since I still think the money is backed by reality and not the other way around.
I’ll start you off.
Money has always been “other people’s debt” and it has never been backed. Never. Not once.
In theory, it’s backed by productivity. In theory.
The modern version is just a jet-fueled version of what the Romans did. It doesn’t change.
Fine, I think I’ve picked up all that as part of my education in the squishiness of money.
But it seems like you’re suggesting I need to learn about second or third or whatever order effects from all this. Kind of like how playing the stock market isn’t about reality, it’s about other people’s perceptions of reality…or perceptions of those perceptions.
For a guy whose brain doesn’t really work that way and would prefer to stay in the real world rather than the game world, where do I put my 401(k) money? So far I’m still money ahead from pulling out when I did, but it won’t be much longer before that’s not the case any more. But with nothing but the game holding up prices it doesn’t seem very wise to get back in…?
But it seems like you’re suggesting I need to learn about second or third or whatever order effects from all this. Kind of like how playing the stock market isn’t about reality, it’s about other people’s perceptions of reality…or perceptions of those perceptions.
Keynes figured this out a long time ago, and transformed his college - think, more like a “dorm” not a “college” - King’s College into the richest one at Cambridge. It’s still the richest.
He did it all while thinking, lying around in his bed, making occasional trades “at breakfast” (after having sex with other guys.) As I understand it, he was quite prolific at the latter activity. Quite remarkable.
Incidentally, it’s irrelevant how your brain works. That’s how the world works, and your “mind-model” has to adapt to fit the way things are not the other way around.
“As I understand it, he was quite prolific at the latter activity. Quite remarkable.”
I read that he peed into the wind while walking around campus, too. Must have been quite a guy…
Incidentally, it’s irrelevant how your brain works. That’s how the world works, and your “mind-model” has to adapt to fit the way things are not the other way around.
I understand that, but people’s brains work the way they do and can only stretch so far. So I ask again, what’s the best course for people like me? Bullets and beans? Dollar cost averaging no matter what kind of shenanigans are going on?
So I ask again, what’s the best course for people like me?
You’re not going to like this answer so buckle up before you read further!
Make steep cuts in “lifestyle”, save a lot, and put it all in bank fixed-deposits. Do it globally. Buy some gold if it makes you happy.
The single largest determinant in all of this complete cr@p is your “savings rate”. Have a poor one, and you’re doomed.
That’s my advice for the “average person”. That’s what I told my parents and that’s what I’m telling you, and my parents have done extraordinarily well.
Oh! and learn how to cook. Not the garbage. Real cooking. From scratch. Get the kids involved.
I have 15th century cookbooks from India where what the greatest Emperor lived can be replicated the recipe for about $4 per person today so I fail to see the problem.
You are asking the wrong person. Faster has never been one of the poor souls who thinks it is necessary to brag about his investing chops and share his asset allocation. I find it odd that anyone chooses to do so and odder that anyone would take advice from someone who does so, but if that is what you want to do, Faster isn’t the person you are looking for.
Oh, and having some insight into how the system works will often help you predict what the endgame has to be. It doesn’t necessarily give you insight into when it will happen.
Yeah, I was just curious what his viewpoint was for people who are not looking to second-, third-, and fourth-guess the other people in the market, the Fed, and everything else.
I’m OK with where I’m at and I don’t think I really need investing advice, but I’m really curious to see what an insider would advice outsiders to do if they were actually being honest.
You are asking the wrong person. Faster has never been one of the poor souls …
I disagree.
I advise my parents. I posted a comment on that but Ben hasn’t approved it yet.
I stand by it.
I’m ruthlessly ethical in a very old school kinda way and even more so, because I have no irons in that particular fire.
I’m sound. It’s just that I’ve learnt the very hard way that nobody likes the truth.
“The single largest determinant in all of this complete cr@p is your “savings rate”. Have a poor one, and you’re doomed.”
Brings to mind a favorite repeat HBB quote which I haven’t seen posted for a while:
“Incidentally, it’s irrelevant how your brain works. That’s how the world works, and your “mind-model” has to adapt to fit the way things are not the other way around.”
Thank you, Pussycat. That’s my head banging lesson about the housing market. I finally came to that conclusion.
“It’s just that I’ve learnt the very hard way that nobody likes the truth.”
You can’t handle the truth!
“That’s how the world works, and your “mind-model” has to adapt to fit the way things are not the other way around.”
Linus: “Good grief, Charlie Brown!”
“When the fish are caught, the net$ are forgotten”
mud-tail-waggin’ old-child dude sittin along the bank of the Emperor’$ Kingdom
Like the lil’ girl said: “I saw an old man sitting on the wharf using a rope to tie holes together.”
Having a good savings rate is solid advice. And it is good advice in all times for most people.
It isn’t the same as describing a trading strategy. I find the people who feel the need to do that and then brag about their returns confusing as all get out. When someone does that consistently, I kind of expect them to start oversharing in all sorts of other ways. But I don’t think I’ll even share what I expect them to start sharing, because that would be oversharing all by itself.
And it is good advice in all times for most people.
Actually, it’s good advice in ALL times for ALL people. I’ve known any number of high-rollers that went under for failing to adhere to that advice.
Also, nobody ever shares their IP. C’mon!
What is this? Amateur hour.
Besides, how many people are tuned into hurricane statistics as an explanatory variable for insurance stocks?
You can either do it yourself, or pay me to do it. Either way on a practical basis, for most people, they should take almost no risk.
Nobody likes this version. Oh well.
” Faster has never been one of the poor souls who thinks it is necessary to brag about his investing chops and share his asset allocation.”
He seems to find it necessary to brag about all his other chops though . . . .
You’re not going to like this answer so buckle up before you read further!
Make steep cuts in “lifestyle”, save a lot, and put it all in bank fixed-deposits. Do it globally. Buy some gold if it makes you happy.
Thanks, I was curious what the answer would be. I don’t have a problem with it :-). I’m curious what you think of Darrell’s point that not everybody can do that, I assume the answer is that not many will try to so it doesn’t matter.
The single largest determinant in all of this complete cr@p is your “savings rate”. Have a poor one, and you’re doomed.
I’ve been working on that area. I’ve already made steep cuts in lifestyle…just trying now to be wise with the money saved. Besides buying the used BMW :-).
So anyway, by your advice, I think I’m mostly on the right track, except for the word “globally”. I haven’t really done anything to hedge my bets on the USA.
I’ve been working on that area.
Work on a different one. Cooking.
Understand the power of cuisine and you’ll cut your biggest cost in the first place. You’ll also have a party (assuming you’re the kinda guy that likes “process” not “product”.)
If lentils can get people week in the knees with the obvious implication (dude!), I’m sure you can manage feeding a family. =)
It’s also very healthy and good for you in the long run.
I’m full of practical advice, I am. =)
That one is tougher for me. I don’t find it fun. And I have cheap redneck tastes that are easily catered to in the market. We ate at Taco Bell last night :-).
Sucks to be you!
Maybe. I like to do other things with that time.
Then, pay for it, and never b1tch about it. It’s a choice.
Not mine but there you go.
I don’t recall bitching about it, but OK. My only complaint is not having a market that’s readable by most people.
“Cooking.”
St Paddy’s Day Green Omelet
Eight eggs
Sea salt
Coriander
Cumin
Turmeric
1 T milk
Generous amount of fresh spinach
Sharp cheddar cheese
A couple of drops of green food color
1 T butter
1. Mix liquid ingredients with hand-held egg beater while melting butter on medium heat in large skillet
2. After butter is melted, pour egg mixture into skillet , and begin to cook omelet in the standard manner
3. Meanwhile, steam spinach and grate the cheddar
4. After omelet has set, add steamed spinach and grated cheddar, fold, and finish cooking
5. Watch your kids’ eyes light up as they enjoy a tasty, green, vitamin-filled treat
“My only complaint is not having a market that’s readable by most people.”
Look on the bright side: The market far more efficient these days, compared to back when real estate and stocks always went up.
OPINION
October 27, 2009, 10:13 p.m. ET
Efficient Market Theory and the Crisis
Neither the rating agencies’ mistakes nor the overleveraging by financial firms was the fault of an academic hypothesis.
By JEREMY J. SIEGEL
Financial journalist and best-selling author Roger Lowenstein didn’t mince words in a piece for the Washington Post this summer: “The upside of the current Great Recession is that it could drive a stake through the heart of the academic nostrum known as the efficient-market hypothesis.” In a similar vein, the highly respected money manager and financial analyst Jeremy Grantham wrote in his quarterly letter last January: “The incredibly inaccurate efficient market theory [caused] a lethally dangerous combination of asset bubbles, lax controls, pernicious incentives and wickedly complicated instruments [that] led to our current plight.”
But is the Efficient Market Hypothesis (EMH) really responsible for the current crisis? The answer is no. The EMH, originally put forth by Eugene Fama of the University of Chicago in the 1960s, states that the prices of securities reflect all known information that impacts their value. The hypothesis does not claim that the market price is always right. On the contrary, it implies that the prices in the market are mostly wrong, but at any given moment it is not at all easy to say whether they are too high or too low. The fact that the best and brightest on Wall Street made so many mistakes shows how hard it is to beat the market.
This does not mean the EMH can be used as an excuse by the CEOs of the failed financial firms or by the regulators who did not see the risks that subprime mortgage-backed securities posed to the financial stability of the economy. Regulators wrongly believed that financial firms were offsetting their credit risks, while the banks and credit rating agencies were fooled by faulty models that underestimated the risk in real estate.
…
Skip the green food color.
Pureé some blanched spinach instead.
You got me there!
Next year…
“Let’s be precise.”
On a $pinning-wobbling planet, $hirley you$ jest!
Filed under: “This too will pa$$!”
/wiki/Federal_funds_rate
Historical rates:
See also: History of Federal Open Market Committee actions
… the most recent change the FOMC has made to the funds target rate is a 75 to 100 basis point cut from 1.0% to a range of zero to 0.25%. According to Jack A. Ablin, chief investment officer at Harris Private Bank, one reason for this unprecedented move of having a range, rather than a specific rate, was because a rate of 0% could have had problematic implications for money market funds, whose fees could then outpace yields
Updated 3/14/2012
Prime rate, fed funds, COFI
This week: .25%
Month ago: .25%
Year ago: .25%
We bubble bloggers were always in the anger stage. While people were taking totally irresponsible banker cheese and bidding up the prices of housing beyond all avarice, we were locked out of owning housing. So we were angry. As the bubble collapsed, the govt used more free cheese and backed the banker cheese. So we continued to be angry. And don’t even get us started on all the millions of people who are living in free housing because they elected not to honor their mortgages and pay them. LOTS of anger potential there!
It should come as no surprise that I moderate my anger with a lot of schadenfreude.
I dunno. Angry? I’m angry about some things, passionate about others.
Who gives a fawk about my sentiment besides you? $hit isn’t right and we all know it. Indifference is tacit endorsement of all things that are fawked up.
‘The game has been extraordinarily well-played’
Again, wth does that even mean?
You shouldn’t talk about my emotions since you have never spent a minute with me in person, you don’t know what I do all day, etc.
What it means is that the central bankers (who are economist - there are no scientists on that board!) genuinely believe that these are just pawns they are moving on a gameboard.
That it actually has a real effect on millions possibly billions is completely elusive to them.
Seriously.
Read anything Bernanke or Krugman says. Ignore the politics or even the view! Just read the rhetoric. They actually think it’s just a video game.
And yes, in the parlance of our time, everyone has been pwned. The few and far between are on this blog and they are “angry”.
Like I said, speak for yourself, not me. You have no idea what I work at all day, how I make a living or what I think is important. But here’s a hint; housing isn’t very high on the list, much less something to get worked up about.
Housing isn’t very high on my list either. It’s just something that keeps off the rain.
I bet you we are closer than you think. And yes, I stand by my original statement.
You have to ride these bubbles the FED keeps creating. Doesnt matter if you like them or not.Do not hold dollars in savings as the value will be inflated away. You need to park your money in assets and be able to recognize the highs and lows. Dont get greedy daniel son. If you just sit back and whine about everything you will go broke fast. Everyone knows the FED is propping up stocks right now. The smart money is just riding this wave as long as they can. They will then dump stocks onto retail and rotate into next asset that they can inflate. What is undervalued right now???????????????
“Everyone knows the FED is propping up stocks right now.”
The Fed Manipulating Stock Prices? So What?
March 13, 2012
Hardly a day passes by that the well known blog ZeroHedge doesn’t highlight some market observer arguing that central banks are manipulating stock prices higher. This usually is accompanied by pretty strong language, like here:
Speaking about rational people refusing to take “blue pills,” lets cut through the rather inflated language used and look at this in a little more dispassionate manner. Let’s start from the assumption that they’re right. So what?
Presumably, stock prices would then be a lot lower. Via all kinds of secondary effects, this would have an adverse effect on economic output as well. Indeed, in an earlier rant, ZeroHedge argued that 25% of world economic output really is fake and only exists thanks to central banks.
This is pretty strong stuff, but if true, then what is the problem? That means that without central bank intervention, the world economy would basically be worse off than Greece, where output since the financial crisis of 2008 has shrunk by 20%. So unless there are some terrible costs attached to this central bank intervention, we really should be extremely thankful for it.
…
i guess there isnt a problem for the 1%. For the working stiff he gets higher fuel and food prices, no interest on savings, devalued dollars and no confidence a rigged stock market.
Everyone knows the FED is propping up stocks right now.
There are a few people out there that clearly realize what’s going on behind closed doors, but most folks honestly don’t want to know, and of course there are the handful who don’t know that they don’t know.
Handful? Try most.
Ask the average person who the Vice President is, or the Secretary of the Treasury. Do it at your next barbecue get-together. Just try it once.
You can forget about the fact that they know what the FED is or who the Chairman is!
Seriously?!? Do we live on the same planet?
Do you even know what humans kinda inhabit this round blob of ours?
“Do you even know what humans kinda inhabit this round blob of ours?”
Lots of them are round blobs.
Only in the US but the rest of the world is desperately working on catching up!
“i guess there isnt a problem for the 1%. For the working stiff he gets higher fuel and food prices, no interest on savings, devalued dollars and no confidence a rigged stock market.”
It’s kinda hard for the $uffering $o’s to improve on those peon fact$.
Yet, they’$ still a $quealin’:
“We been taxed-$lapped and can’t get up! Help!”
&
“Please help us 1% ‘ers build$ you a major-citizen-taxpayer-monie$ $port$ $tadium with $weet $uite$ that can be used fer personInc. “Bidne$$” tax deduction$”
“Only in the US…”
One of the most interesting conversations I ever had was with a friend from India, who pointed out how USDA subsidies result in food for America’s poor that encourages obesity (e.g. govt cheese, junk food, etc). By contrast, the poor in India tend to be rural farmers who grow produce but cannot afford to consume meat; hence India’s rural agrarian poor are often healthier than wealthier Indians who can afford to clog their arteries with cholesterol.
Used to be in India. Not any longer.
One of the greatest articles on Bloomberg - they’re the only ones that can afford to pay for “real” journalism these days - about a year ago was an article on the rise of diabetes in India.
Basically, it’s super complicated. Apparently, our bodies are imprinted for life on what happens early on. Whether or not we are diet-rich as babies matters more than anything else whether we will develop diabetes as adults.
The argument is that if you are diet-poor at or around birth, and then later in life achieve prosperity, you are almost guaranteed to be diabetic. It’s how we are constructed.
That’s most of India. They have a massive diabetes bombshell coming down the pike.
AZdude, some people have been riding stocks mostly the last few decades and their average cost is very low - particularly in stock funds. A 50% drop in the broad indices would only be a setback but would not put those people into the poorhouse. The “little people” refuse to learn that the fastest way to grow wealthy is in equities, not by being a slumlord.
The S&P 500 index from 2000 to 2009 had a dismal performance, but it’s all cyclic and the decade from 2010 to 2019 could be the decade for good gains on large domestic company stock.
And yes, the peanut gallery will keep refusing to understand markets are cyclic. They will keep their cash under a mattress and all that cash may buy them a loaf of bread if they are lucky.
We know what you say on here, and you sound angry. Of course you could be pretending, but why would you do that?
You want to see what angry looks like?
‘After five days cloaked in military secrecy, the soldier suspected in a massacre of 16 Afghan civilians has finally been identified, adding a critical detail to the still-sketchy portrait just beginning to emerge. Records accessed by The News Tribune indicate that Robert N. Bales owns a home in Lake Tapps with his wife. He and his wife, Karilyn, bought their house in Lake Tapps in November 2005, county records show. They paid $280,000 for a 4-bedroom 2-story home built in 1990. The house was listed for sale on March 12.’
‘The Bales family suburban split level house in a wooded Lake Tapps neighborhood has the feel of a home that was quickly emptied. Cardboard boxes with children’s toys and other items were left on the porch, along with unread newspapers dating to January. An American flag is propped against the entryway of the house. Neighbors said they hadn’t seen cars coming and going for a few months.’
I don’t know any details and, of course, every story is different.
But, just taking a cursory glance at the information, I would wonder what a “soldier” is doing buying a $280,000 house.
Perhaps he has rich relatives, or his wife is independently wealthy. Don’t know.
But, it seems to me, that an average “underpaid, u.s. military servant” could not possible survive the long-term debt strain caused by a quarter-million dollar purchase, usually made as mortgage debt.
So, if I read between the lines, it is probable that this “soldier” lost his mind when his 6 years of assumed payments resulted in a negative net gain on this “investment”.
And since the Realtor(guessing) who sold him this dream assured him that “real estate always goes up”, he has been very frustrated by the recent abandonment of the dream.
Would that make me angry? Sure. I’ve been lied to. And sold a bill of goods….. a depreciating house.
My guess is that there is also a divorce and loss of access to his children involved. Military marriages frequently don’t do well during deployments even when housing isn’t an issue. Add housing and repeated deployments and I can’t imagine how hard it is. I spent a few months in Clarksville, TN while my wife deployed in Saudi Arabia for Desert Storm and got to watch what goes on back home in person when most of the soldiers are gone…it was crazy to watch.
“…got to watch what goes on back home in person when most of the soldiers are gone…it was crazy to watch…”
Can you elaborate? I’m genuinely curious (not from a military family).
We do have friends with the head of household deployed to Afghanistan. They bear up well, but the strain is visible.
What I saw was a deployment that occurred after years and years of no deployments, and it came as a surprise with only a week or two warning for most people. Everyone was kind of in shock about it, and everyone was told they were there until is was over, WWII-style. So nobody had any idea how long it would last.
Disclaimer: I’m not talking about everybody…just what seemed to be “average”.
What I saw was the wives mourned for about two weeks, and then you started hearing the stories of what happened over the weekend at the club…so and so’s wife was all over some dude and they left together…and pretty soon there was a story like that for the majority of the wives I knew. I stopped attending the spouse support meetings within a month because the atmosphere was getting toxic with all the cheating going on to the point that it was assumed by most of the people there that I was there to pick up army wives. Within another month or two there were guys LIVING with army wives whose husbands were deployed…with the full understanding that they would be gone before the husband returned.
To a small-town Mormon boy separated from my wife for our first anniversary it was bewildering. The local guys who always hated the GIs definitely got their revenge the winter of 90-91.
“But, just taking a cursory glance at the information, I would wonder what a “soldier” is doing buying a $280,000 house.”
The same thing they are doing when they buy $60k trucks, and dump another $25k in “mods.” I have never been in the military, and nobody in my family has either, so I always figured it must be a decent paying career given how these people spend. I guess they are big on debt?
There is debt, but they also make more than you might think when you take into account all the allowances including combat pay. I also think they don’t have to pay taxes while deployed…at least I’m pretty sure we didn’t when my wife was deployed.
When you make a reasonable amount, feel secure that your job isn’t going away (key word: feel), and can spend most of what you make on toys if you want, it creates interesting spending patterns.
“…the atmosphere was getting toxic with all the cheating going on to the point that it was assumed by most of the people there that I was there to pick up army wives. Within another month or two there were guys LIVING with army wives whose husbands were deployed…with the full understanding that they would be gone before the husband returned.”
That’s what I thought you meant, but thanks for explaining.
Whoa, Ben — chilling find.
I heard that the soldier might have been drinking at the time of the massacre, but nothing till now about the foreclosure angle. Any news about which Wall Street bank was involved with the foreclosure that led to a massacre?
I heard his wife has a good job, somewhat prominent, with a nonprofit.
You shouldn’t talk about my emotions since you have never spent a minute with me in person, you don’t know what I do all day, etc.
This is both fair and unfair.
It’s fair because what you say has a basis in truth.
It’s unfair because it’s not actually necessary to do what you say to “know” a person.
I can fairly safely say that you are an ethical person with a quiet, razor-sharp almost wicked sense of humor. I didn’t have to meet you to know that either. It’s quite obvious.
One of the human traits (and some scientists argue is a driver of our large brains) is the social ability to “read” others because we can’t share their thoughts. So we rely on conjecture, empathy, projection, etc. We mostly get it right but can get it wrong. It’s probabilistic not guaranteed.
“Again, wth does that even mean?”
Sounds like pure BS, but take what I say with a big grain of salt, as I am allegedly one of the HBBers stuck in the anger phase…
Yes, you are.
If you’d actually read what I said rather than acting viscerally, you might actually learn something.
Clearly, I’m not the only one who’s sensed it. There are others.
(Read above about “social reading” and our brains.)
I’ve read enough of what you have said over the years to realize you agree with me that acting viscerally is great fun on occasion…
On occasion. Even often. Not daily.
I agree like i posted before i know of 5 houses on the walk home from the subway not paying the mortgage…and 1 bragged she just spent $4400 on her dog…….I just hope my cat doesnt get sick anytime soon…
“You shouldn’t talk about my emotions since you have never spent a minute with me in person, you don’t know what I do all day, etc.”
I’m certain your day goes kinda like this:
http://www.youtube.com/watch?v=sByVwTHYkCE
Comment by peter a
2012-03-16 05:28:21
“My seventy year old coworker is trying to keep her house purchased five years ago with a 50 year mortgage.”
Comment by jeff saturday
2012-03-16 08:17:28
“Well I`ll go ahead and buy an overpriced house if they will give me a 250 year mortgage with a fixed rate at 3.75%. But I am 52 years old, maybe I had better hold out for a 300 year loan.”
Comment by Prime_Is_Contained
2012-03-16 10:33:35
“Why not interest-only forever? In other words, the _infinite_ years mortgage…”
Outlaws Green Grass And High Tides lyrics :
In a place you only dream of, where your soul is always free
Silver stages, golden curtains, filled my head plain as could be
As a rainbow grew around the sun, all my stars above, who died
Came from somewhere beyond the scene you see
These lovely people played just for me
Now if I let you see this place where stories all ring true
Will you let me past your face to see what’s really you
It’s not for me I ask this question as though I were a king
For you have to love, believe and feel
Before the burst of tambourines take you there
Interest-only loans forever
Castles of stone, soul and glory
Lost faces say we adore you
As kings and queens kick the can for you
Those who don’t believe me, find your souls and set them free
Those who do, believe and know that time will be your key
Time and time again I’ve thanked them for a peace of mind
That helped me find myself amongst the music and the rhyme
That enchants you there
Interest-only loans forever
Castles of stone, soul and glory
Lost faces say we adore you
As kings and queens print money for you
Yeah they print it just for you
Outlaws- Green Grass & High Tides - YouTube
http://www.youtube.com/watch?v=YZvQmEt4xGQ - 144k
The FBs get a do over, I want one too.
Outlaws Green Grass And High Tides lyrics :
In a place you only dream of, where your house is always free
Silver stages, golden curtains, filled my head plain as could be
As a rainbow grew around the sun, all my stars above, who died
Came from somewhere beyond the scene you see
These lovely people paid just for me
Now if I let you see this place where stories all ring true
Will you let me past your face to see what’s really you
It’s not for me I ask this question as though I were a king
For you have to love, believe and feel
Before the burst of loan mods will take you there
Interest-only loans forever
Castles of stone, soul and glory
Loan brokers say we adore you
As Fed chiefs kick the can for you
Those who don’t believe me, find your loans just look and see
Those who do, believe and know they get to live for free
Time and time again I’ve thanked them for a peace of mind
That helped me find myself amongst the millions Robo-signed
That encamps you there
Interest-only loans forever
Castles of stone, soul and glory
Loan brokers say we adore you
As Fed chiefs print money for you
Yeah they print it just for you
Excellent job Jeff. One of my favorite songs too.
Modern metrics not so green. Inflation 3% rising. Fuel prices - ouch. Money market/savings yield - ha ha. Bonds optimist outlook .75 - 2%. Stocks return est.forward 1.5 - 3%. Higher ed costs up up. Food and healthcare costs up up. Cost/Loss ratio AZ home ownership for 30+% population - minus 20-30%. Head of household wage earners longer hours = less supervision of offspring = future surprises. Maybe a pocketful of shamrocks will get me through this to my retirement days of clover. Nah.
Food and healthcare costs up up.??
NO. no. Obamacare was sold to us as a cure for this and is guaranteed to reduce the costs of medical care. That was the sole reason for its introduction and passage. Or so they said.
To say that costs will continue to rise is to say that we were lied to.
Also, Obama has told the Universities that they should contain their costs and that soon government loans will be targeted to those schools that help restrain tuition rates.
So, we know for sure, after a good talking to, that tuition will hold the line, if not rise.
And lastly, there is NO inflation. Where did you get this 3%? we have the government telling us it’s “benign”. Just don’t buy gas or food. Or insurance. Or batteries. Or other stuff you might need.
My parent’s pulmanologist is participating in one of the new programs where the office gets paid more to keep people healthy enough that they don’t have to go to the hospital or need expensive medical interventions. A year ago, keeping people out of the hospital and keeping them healthy enough that they didn’t need expensive tests and/or interventions would have cost the docs a ton of money as it requires longer regular check ups to catch problems when they are not yet critical and they got no additional compensation for trying to do that.
“Money market/$aving$ yield$ - ha ha”
“Food and healthcare cost$ up up.”
Ca$h-in-the-can-buried-in-yer-backyard
Similar to:
drop alka-seltzer in glass of water, watch the edge$ bubble … be patient …
Survive the new world disorder
Patrick Commins
March 18, 2012
Economic conditions have changed so drastically that what once was viewed as common sense now threatens your financial wellbeing. Patrick Commins examines strategies to thrive.
After a new mantra for your investing? Try this: ”When the facts change, I change my mind.”
That pithy line is attributed to economist John Maynard Keynes. And when it comes to investing, the facts have changed - or rather, what we thought were the facts no longer ring true. Here is a sample of former truisms: buy and hold is a safe way to invest; sharemarkets outperform over the long term; house prices only go one way - up.
After a long, sunny period, a splash of cold water - courtesy of the GFC - has left many investors bewildered and gasping. The first response was flee to safety. Deposit accounts around the country bulge.
Advertisement: Story continues below
But it’s unlikely that bank deposits will provide you with the wealth creation you need to reach your financial goals, especially if inflation gets on the march.
And paralysis is not an investment strategy. If you are thinking about reinvesting some of those dollars, you need to understand the new rules of investing. What worked in the 1990s may not work now.
There are six commandments you need to learn to be successful in the brave new world of investing: lower your expectations; seek absolute returns; minimise volatility in your portfolio; forget set-and-forget; think global; and get a grip on how your mind can play tricks on you.
…
Why do greater fools fall for the line that the stock market is the best investment?
Equity markets
Shares and shibboleths
How much should people get paid for investing in the stockmarket?
Mar 17th 2012 | from the print edition
IF THERE is a sacred belief among investors, it is that equities are the best asset for the long run. Buy a diversified portfolio, be patient and rewards will come. Holding cash or government bonds may offer safety in the short term but leaves the investor at risk from inflation over longer periods.
Such beliefs sit oddly with the performance of the Tokyo stockmarket, which peaked at the end of 1989 and is still 75% below its high. Over the 30 years ending in 2010, a “long run” by any standards, American equities beat government bonds by less than a percentage point a year.
In this section
In the developed world, the period since the turn of the millennium has been a particular disappointment. Since the end of 1999 the return on American equities has been 7.6 percentage points a year lower than that on government bonds (see chart 1). That has left many corporate and public pension funds in deficit and many people with private pensions facing a delayed, or poorer, retirement. Understanding why equities have let investors down over the past decade will help them work out what to expect in the future.
…
Federal Reserve For Dummies
(Explained in an interview with a crash-test dummy who uses only body language…)
In order to understand why the FED is absolutely hell-bent on driving mortgage rates low, it’s useful to understand what happens as rates go to zero.
You can derive this relationship quite easily if you remember your basic calculus but if not, here’s a more gentle reminder.
The first column is rates. The second column is a payment for $100K on a 30-year mortgage, a 50-year mortgage and a “mortgage into perpetuity”.
There is very little difference at normal rates but as you go down, you start seeing differences. Of course, we all know by basic economics that the bond-holders (or the government) are going to take a bath but this is an exercise in bond-math not the real world.
0.5 $299 $188 $42
0.75 $310 $200 $63
1 $322 $212 $83
1.25 $333 $224 $104
1.5 $345 $237 $125
1.75 $357 $250 $146
2 $370 $264 $167
2.25 $382 $278 $188
2.5 $395 $292 $208
2.75 $408 $307 $229
3 $422 $322 $250
3.25 $435 $337 $271
3.5 $449 $353 $292
3.75 $463 $369 $313
4 $477 $386 $333
4.25 $492 $402 $354
4.5 $507 $419 $375
4.75 $522 $437 $396
5 $537 $454 $417
5.25 $552 $472 $438
If a mortgage is in perpeturity then there is no principle pay-down, right? One pays only the interest, right?
So as the interest rate heads to zero the payments also head to zero, right?
Oh, you just had to go there, didn’t you?
(So I hie my ass over to one of my zillion bookshelves to yank out the comprehensive and exhaustive A History of Interest Rates. This is one of the great books of all time! At least, in financial matters.)
The lowest that I understand that interest rates have gone on a modern sovereign nation is 2 1/4 % for perpetual annuities.
That would be for the British Empire at the height of their “empireness” (late 1890’s.)
We still have a ways to go. Not quite there in “uncharted territory”.
BWAHAHAHHAHAHHAHAHAHAHHAHAHAHHAHHHHHHHHHHHHHHHHH!!!!!!
Is this the book authored by Sidney Homer? If so, not a cheap book.
Yeah, that’s the one.
Worth it’s weight in gold. Literally.
You’ll grasp this book (ok, all my books!) out of my cold, dead hands.
Decent copy is about fifty bucks minimum on Abebooks. I use Abebooks alot, usually get used books for a lot less. Oh well, it is only money, and it is certainly difficult to get a decent return anywhere else.
Books?
I’m an addict, and as my parents might tell you, there’s no chance of reform.
I read every single one. That’s what separates me from the bibliophiles.
“hie”
Now there’s a verb you don’t see in print every day.
If You Could Hie to Kolob
That’s exactly what I thought of when he said that, too :-).
What can I say?
I know a lot of words (and verbs) in a lot of languages, and it was the right word for this particular occasion
I just love words - does anyone beside me think that “crepuscular” is just absolutely delicious?
Only polly probably? Maybe ahansen.
SIGH.
I’m guessing that the only posters on here who knew what “hie” meant at a glance have LDS associations…I love the verb, but even my wife finds the song a bit peculiar.
Crepuscular is nice.
Defenestration is still my favorite. Ahansen can vouch that I did something about it once too, but it was personal enough to identify me, so I didn’t share it widely.
I nearly bust a gut when they named one of the condo buildings in the newly developed Rockville Town Center The Fenestra. Defenestrations at the Fenestra sounds so lovely. And of course, getting shoved out a window might be a good think if you had ever paid $600K for a two bedroom condo in Rockville Town Center.
That is the most amazing story I’ve heard in a while. Thank you!
I haven’t had tears wet my shirt for a long time, and I’m sure we can all agree that we need it!
BTW, “defenestration” is one of my favorites too.
I have a story in Boston that involves lawyers and defenestration and expensive buildings that might just make your list too.
The lawyer survived.
Craptacular is nice, too, in its own special way.
“defenestration”
You probably know this, but an early instantiation of that word was in reference to something which occurred a few centuries back at the Prague castle.
We know the verb, PB!
If you were actually educated, and you knew your Greek, Latin, and Anglo-Saxon forms, you might want to enlighten us with what the adjective-form of “devil” is?
Hint: It’s NOT “devilish”.
PS :- It was on a quiz in school and I failed. I don’t like that.
They seem to be apartments now. I do think they tried to sell them in 2007-2008 or thereabouts.
http://www.fenestraapts.com/
The story isn’t the one about a young male associate showing off to a female summer associate about the windows being completely sealed shut and throwing himself at one, the window popping out and both glass and associate falling to the ground? I heard that one about Chicago, I think and in that version the jumper died, but it has been around for a while. I have the feeling it is an urban legend, but I’m not positive I want to know, so I never look it up.
Mine’s better, and it’s real!!!
It’s the ultimate American story. Nobody dies at the end and we can all laugh about it, and the lawyer is the joke not because of his lawyer-ness (but that’s the driver!) but because of basic physics, chemistry, etc.
A friend almost used “defenestration” in a police report. But but the other cops in the district already thought he was a little weird and too smart, so he didn’t.
“If you were actually educated,…”
You can’t resist self-created opportunities to cut others down, can you? I understand — I have a BIL from NYC; it’s cultural.
Reminds me of a musical version of “A Room with a View” my wife and I attended last night. Since you read a lot, you probably have a copy of the novel on your bookshelf. Anyway, my favorite character in the play was the snobbish fiance’, who the would-be bride Lucy’s brother kept referring to as “The Fiasco.”
At the end of the day, “The Fiasco” lost his bride because of his condescending attitude towards everybody.
You can’t resist self-created opportunities to cut others down
I note that you didn’t figure out the adjectival form of “devil”.
I must be portrayed as positively diabolical.
You ought to have come up with that answer on your quiz, given your mephistopholistic proclivities.
If only I could be 8 again. Oh, how I would slap myself silly!
It’s frustrating to be old and smart. I am quite confident I could score an 800 on the SAT math test and finish with time left, but I can’t get my kids to stop playing their various computer games for long enough to train themselves to do likewise.
Bear,
That is the Second Defenestration of Prague, though it is the one with the famous woodcut. There is a first in which people did die. And there have been a few minor ones. They do seem to love shoving people out windows in Prague.
I first read about it in a Stephen Jay Gould essay, but then my European history classes have been pretty terrible.
Polly — Appreciate the insights. The history of Prague is a source of fascination to me, especially after having visited for the first time a few years back…
“One pays only the interest, right?
So as the interest rate heads to zero the payments also head to zero, right?”
I believe the correct statement is that the purchase price heads to infinity. Think about the implications for Jose Six Pack’s home purchase budget on $30K annual household income. (Check out slide 7 in the linked presentation…)
“Eyes do believe Mr. Ben’s HBB covers ALL 5 of them circle$ on $lide # 5!”
Tanks once again, … oh, angrie$t & cantankerou$ one!
“I think the correct statement is that the purchase price heads to infinity.”
This brings forth thought: What is the worth of a good paying, secure job in a low return environment?
If a person retires and cashes out his pension and gets, say, half a million dollars as a cashout, what sort of return should he expect to get in this low return environment?
Maybe $10,000 a year, $20,000 is he is lucky?
People I know at work are doing this, they are retiring - some early - and are cashing out their pensions and plan to live the rest of their lives on the cashout, or rather the returns generated by the cashout.
But the returns are just not there. And they probably won’t be there for a long, long time (think Japan). So that means that sometime down the road they will have to go back to work. But the jobs they will be getting then will not even come close to paying what the jobs that they are walking away from now are paying.
So, back to my original question: What is the worth of a good paying, secure job in a low return environment?
“What is the worth of a good paying, secure job in a low return environment?”
Coming from you, I just know that was a rhetorical question, but nonetheless I cannot resist sharing the answer:
CASH.
Actually I’m thinking in terms of cash flow - the flow of cash from one’s job as compared the flow of cash from an investment one would need to enter into as a result of a cashout from one’s job.
In a high return environment an well-invested cashout will make up for a lot of missing earned income. But in a low return environment it won’t.
Cash flow is the only game in town.
Always has been. Always will be.
Read some Graham. Buffett’s mentor.
“Actually I’m thinking in terms of cash flow…”
Same here; I guess CASH was too brief.
In the “Good Old Days”, that ended in 2006-or-so, the cashout of equity in one’s house was destined to supplement - even exceed - one’s earned income.
Better yet: One could buy several houses and keep the equity cashout flowing from each one of them and he/she should never have to ever work again.
And then … something very interesting happened …
“And then … something very interesting happened …”
As in two-income homeowner households seeing their effective incomes go from three to one, as yesterday’s home equity gains turned into post-bubble home equity losses to more than offset income number two?
Check out slide 7…
So many of those Mexicans honestly believe in god and miracles, so home prices that are 14x to 28x income don’t really matter.
“…god and miracles…”
Property Rites
Claim: Burying a statuette of St. Joseph on the property will help speed the sale of a home.
…
QE4 warning ahead?
The First 12 Hours after the US Dollar Collapse
I really don’t see a run on grocery stores due to anything that happens on Wall Street. I think the average American is completely numb to it any more. It’s only if they hear a rumor that deliveries to the stores might stop…
Those gold bugs have very lively imaginations, don’t they? Too bad for them their paranoid fantasies are utterly incoherent.
They also never seem to grasp the main reason that gold prices act so crazy: The dominance of central bank purchases.
How do the gold bugs manage to perpetually miss central bank manipulation as a key driver of gold prices? Don’t they realize central banks could bury the global market in physical, crashing prices to earth in an instant, if they decided that was in their collective interests?
ft dot com
March 16, 2012 6:51 pm
Central banks pounce on falling gold
By Jack Farchy
A sharp fall in gold prices has triggered large purchases of bullion by central banks in recent weeks, according to several traders with knowledge of the transactions.
The buying activity highlights the trend among central banks in emerging economies to buy gold, even as some western investors are losing patience with the metal. Gold prices have dropped 13.8 per cent from a nominal record high of $1,920 a troy ounce reached in September, and on Friday were trading at $1,655.60.
The Bank for International Settlements, which acts on behalf of central banks, has been buying significant quantities of gold on the international market amid falling prices, traders said.
According to several estimates, the BIS bought 4-6 tonnes of gold, worth roughly $250m-$300m at current prices, in the over-the-counter physical market last week, with purchases particularly strong at the end of the week. The total purchases over the past three or four weeks were likely to be as much as double that, the traders added.
In a note to clients this week, Credit Suisse referred to “aggressive central bank buying seen last Friday”.
The BIS declined to comment.
Central banks are one of the most important drivers of the gold market, holding one-sixth of all the gold ever mined in their reserves, but they disclose few details about their activities.
As a group, they made their largest purchases of gold in more than four decades last year, led by emerging economies such as Mexico, Russia and South Korea intent on diversifying their dollar-heavy foreign exchange reserves. The World Gold Council has also pointed to the possibility of significant unreported purchases by China at the end of last year.
…
I couldn’t watch that paranoid crap.
2012 - the year the US Dollar will collapse, US Dollar slippery slope to economic collapse
Uploaded by botanyfamily on Jan 13, 2012
The US dollar is on a path of no return, it will collapse in 2012
The USD is not going to collapse.
This is, how do I put it politely, a rank steaming hairy buncha bollocks!
Quit being the National Inquirer, PB.
This is on the same level as “Aliens had my baby”, etc. I’d lay off the sauce in the morning.
‘This is on the same level as “Aliens had my baby”, etc. I’d lay off the sauce in the morning.’
Do I have to spell it out for you yet again?
E-n-t-e-r-t-a-i-n-m-e-n-t!
Hi. Happy St. P’s day. While I am not crazy for dollars still like them better than the alternatives.
Cute little condo in my hood. Would make a nice home. 1 bedroom 1 bath ~ $360K. Overpriced by $100K. Purchased in July 2005 for $410K.
http://www.realtor.com/realestateandhomes-detail/88-Park-Ave-Unit-204_Arlington_MA_02476_M45475-48240
I’ve also noticed having a few dollars available comes in handy when buying cars, violins, violas, pianos, etc etc etc…
No need to throw your hard-earned dollars away on real estate money pits.
Erin go Bragh
“The US dollar is on a path of no return, it will collapse in 2012″
That’s nonsense, now excuse me while I finish this loan application for laundry detergent.
The housing recovery mantra rolls on and on…
March 17, 2012, 12:01 a.m. EDT
Housing data take center stage for U.S. investors
Oracle, Nike, Micron Technology to post quarterly results next week
By Myra P. Saefong, MarketWatch
SAN FRANCISCO (MarketWatch) — A raft of housing-market data and earnings from economic bellwether FedEx Corp. may offer investors fresh clues next week about the strength of the U.S. recovery.
Financial results from Oracle Corp. ORCL -0.13% and Nike Inc. NKE +0.50% and speeches from Federal Reserve officials may also take the spotlight next week.
“The economy is beginning to recover despite some doubters believing economic growth is temporary,” said Michael Yoshikami, chief executive officer of Destination Wealth Management in Walnut Creek, Calif. “It’s our view that a real recovery is in play and that will likely lead to additional market rallies.”
…
The most valuable investing advice I have seen on the HBB was offered by a former frequent poster who called himself Hoz: The most important aspect of bear market investing is to avoid losing large sums of money.
Ask the Expert
Fleeing to cash won’t protect retirement savings
By Walter Updegrave @Money March 16, 2012: 3:09 PM ET
NEW YORK (CNNMoney) — I’m a 65-year-old retiree who has a comfortable pension and retirement savings that, for now at least, I don’t need for living expenses. About a year ago I moved my savings into cash because I was worried about the unstable stock market and the crisis in Europe. I hate to see this money earn nothing, but I don’t want to lose it if the stock market dives. Should I leave my savings in cash? Invest it in short-term bonds? Should any of it go into stocks? — Don S.
Given all the turmoil in the economy and the financial markets the past couple of years, it’s not surprising that you want to be careful about keeping your retirement stash secure.
But fleeing to cash to protect your savings is an ill-advised move that can backfire. In fact, in your case it already has.
Since you pulled out of the market a year ago, stocks have gained almost 10%, while bonds have returned roughly 7%. Which means that even the most conservative mix of stocks and bonds would have given you a much better return than, say, a money-market fund, which likely earned less than 0.1% over the past year. So in the short-term at least, your gambit didn’t pay off.
…
Good ol’ Hoz, … x3 cheers mate!
He’s moved on. To dust and dirt, etc. So it shall be for all of us.
He was a smart one, and I loved our reparteés both on and off this forum.
I miss him.
Thanks for the news, even though it is sad. (I had suspected as much…)
It’s noteworthy that by now, the tail end of the housing bubble has outlived some long-time HBB posters.
I bet the effects of it outlive plenty more of us.
I bet it outlives me and I’m quite possibly the “junior” around here.
I miss Oly too.
We corresponded extensively, and flirted in the best sense of the word, and exchanged and fought over email.
I can’t believe she died while I was off gallivanting in India.
My pictures of flowers (for her, and my mom! I have no interest) lost all their lustre when I learned about it. I can’t look at them any more either.
How fragile is the fabric of our lives!
Dammit, really?
Don’t you just love it when real estate developers choose sites for neighborhoods that turn them into ticking time bombs?
Something similar happens in SoCal, often with respect to geophysical risk. Old landslides or canyons with a history of debris flows make very popular sites for housing developments.
Hunt Zeros In on Mystery of Old Site Called Hades
Luke Sharrett for The New York Times
A house in the Spring Valley area of Washington that is to be razed.
By THEO EMERY
Published: March 17, 2012
WASHINGTON — For decades, affluent families have flocked to Spring Valley, a quiet neighborhood hugging the northwestern boundary of the nation’s capital. True to its name, magnolias are blooming and daffodils carpet the yards.
But during World War I, soldiers called it Death Valley. It was here that the Army cooked up chemical weapons, launched poison-packed mortar shells and sent gas clouds billowing over the fields.
When the war ended, soldiers buried the fearsome chemicals and munitions in pits that the Army forgot existed.
Now, the cleanup of what was known as the American University Experiment Station is nearing a crucial point. This spring, the Army Corps of Engineers plans to tear down a house that may be atop a lost burial pit that an Army sergeant called “Hades” in a grainy 1918 photograph.
That photograph, unearthed about 75 years after the soldier paused beside mustard gas canisters destined for burial, has provided the surest clue to the pit’s location, which has been one of the most elusive mysteries in the nearly 20-year cleanup. If it leads to the right spot, it will have solved an enduring puzzle and hastened the end of one of the nation’s costliest cleanups of a former military site.
In the past, relations between the Army and residents have been fraught with distrust. Some in the area believe that chemicals in the soil have sickened residents; others scoff at those assertions. A few remain unconvinced that the pit is even in the spot where the corps is looking. Many simply want to end a troubling and disruptive episode.
“I think the whole neighborhood would be pleased if the whole thing would be considered over,” said Janet Bohlen, 82, who described how the Army dug up a mortar shell and arsenic-tainted soil from her property. “Whether it will ever be considered over, I don’t know.”
Thousands of contaminated military sites dot the nation, but Spring Valley stands apart. It is the sole chemical weapons site that was developed into a neighborhood, and its prestigious residents have included at least three former presidents.
Now a coveted residential ZIP code, the area in Northwest Washington was briefly a center of chemical warfare research, a frantic response to Germany’s weapons. Some historians liken it to the Manhattan Project.
American University, which had bought hundreds of acres of land for a new campus, leased the property to the government when the United States entered the war in 1917, as did nearby property owners.
In the hastily erected research village, chemists raced to find lethal chemicals to unleash on the Germans. They tested protective masks, gloves and clothing. They experimented with flamethrowers and toxic smoke-spewing candles. They tested on dogs, rabbits and other animals, as well as humans.
“This was the chemical weapons mecca,” Joel A. Vilensky, a professor at the Indiana University School of Medicine who wrote a book about lewisite, a blister agent dubbed the “dew of death” that was among the chemicals used at the research site.
…
#93 on the booking blotter but #1 in your heart because this Deadbeat was at least trying to raise some money after his refi cash went dry. Omar ruv you rong time.
March 16th 10:53 pm
Zapata, Omar
Charges:
•796.07-2729 Prostitution -
or Assignation Offer Commit Engage 1st
http://www.palmbeachpost.com/blotter - 39k -
Type: D
Date/Time: 4/13/2005 11:39:36
CFN: 20050214325
Book Type: O
Book/Page: 18405/1859
Pages: 1
Consideration: $127,500.00
Party 1: CONNER JEANNE
Party 2: ZAPATA OMAR
PUERTO LUZ V
Legal: LEES CROSSING 1 B33 L3 BL
Type: MTG
Date/Time: 4/13/2005 11:39:36
CFN: 20050214326
Book Type: O
Book/Page: 18405/1860
Pages: 23
Consideration: $102,000.00
Party 1: ZAPATA OMAR
PUERTO LUZ V
Party 2: MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC
PEOPLES CHOICE HOME LOAN INC
Legal: LEES CROSSING 1 B33
Type: MTG
Date/Time: 4/13/2005 11:39:36
CFN: 20050214327
Book Type: O
Book/Page: 18405/1883
Pages: 9
Consideration: $25,500.00
Party 1: ZAPATA OMAR
PUERTO LUZ V
Party 2: MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC
PEOPLES CHOICE HOME LOAN INC
Legal: LEES CROSSING 1 B33 L3 BL
Type: MTG
Date/Time: 6/19/2006 12:19:24
CFN: 20060360248
Book Type: O
Book/Page: 20492/1284
Pages: 4
Consideration: $58,993.00
Party 1: ZAPATA OMAR
PUERTO LUZ V
ZAPATA LUZ V
Party 2: WELLS FARGO BANK NA
Legal:
Type: MTG
Date/Time: 7/21/2006 09:39:36
CFN: 20060424804
Book Type: O
Book/Page: 20627/1514
Pages: 17
Consideration: $267,900.00
Party 1: ZAPATA OMAR
PUERTO LUZ V
Party 2: MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC
HOME LOAN CORPORATION
EXPANDED MORTGAGE CREDIT
Legal: HOMES LEES CROSSING 9 L559 L
Type: LP
Date/Time: 10/1/2008 12:24:39
CFN: 20080361092
Book Type: O
Book/Page: 22885/304
Pages: 1
Consideration: $0.00
Party 1: BANK OF NEW YORK TRUSTEE
Party 2: DOE JOHN
BRENTWOOD LAKES HOMEOWNERS ASSOCIATION INC
ZAPATA OMAR
PUERTO LUZ V
DOE JANE
Legal: HOMES LEES CROSSING 9 L559 L
“Omar ruv you rong time”
For those of you who have never seen Full Metal Jacket.
http://www.youtube.com/watch?v=9mlVBs86N7E - 133k -
Five dollars is all my mom allows me to spend.
Oh man, I was wayyyyy too young to see the bathroom scene when I did. That gave me nightmares for years.
I still get weirded out when I see D’Onofrio on Law and Order.
I guess looking at the other dudes like Alfonso Perez, Omar was looking to spend some of that refi money on someone who would ruv him rong time not earn any.
Off to eat Korean food with a bevy of beauties!
Can you toss me some crumbs (a couple of beauties…I would assume you have more than you can satisfy)
Oh Exeter! and anyone else that signs representation contracts, you might want to check out this little fee realtors are tacking onto their payment structure.
http://www.rd.com/slideshows/13-things-your-real-estate-agent-wont-tell-you/
“And read every word of the representation contract. “There may be an extra ‘administrative fee’ ranging from $250 to $1,500 on top of my standard commission, intended to cover my brokerage’s administrative costs,” tip No. 6 says. “Similar to my commission, this fee is negotiable.”
And the sale doesn’t happen.
Banks are mere profit centers to fund the global war machine.
Wall St is a mere profit center to fund the global war machine.
Investments are dupes to fund the global war machine.
The Fed Reserve is a proxy for the global war machine.
I’ve been pondering similar thoughts: Does the Fed’s serial QE operation grease the skids for more wars going forward?
If anyone has the dirt on which Wall Street Megabank was trying to foreclose on the Bales family, please share.
Military - US
Money, career woes reportedly plagued Afghan killings suspect
Published March 18, 2012 | Associated Press
Aug. 23, 2011: In this Defense Video & Imagery Distribution System photo, soldiers from Blackhorse Company, 2nd Battalion, 3rd Infantry Regiment, 3rd Stryker Brigade Combat Team, 2nd Infantry Division, including Staff Sgt. Robert Bales, left, take part in exercise at the National Training Center at Fort Irwin, Calif.
LAKE TAPPS, Wash. – Bypassed for a promotion and struggling to pay for his house, Robert Bales was eyeing a way out of his job at a Washington state military base months before he allegedly gunned down 16 civilians in an Afghan war zone, records and interviews showed as a deeper picture emerged Saturday of the Army sergeant’s financial troubles and brushes with the law.
…
He was struggling to keep payments on his own home in Lake Tapps, a rural reservoir community about 35 miles south of Seattle; his wife asked to put the house on the market three days before the shootings, real estate Philip Rodocker said.
“She told him she was behind in our payments,” Rodocker told The New York Times. “She said he was on his fourth tour and it was getting kind of old and they needed to stabilize their finances.”
The house was not officially put on the market until Monday; on Tuesday, Rodocker said, Bales’ wife called and asked to take the house off the market, talking of a family emergency.
Bales and his wife bought the Lake Tapps home in 2005, according to records, for $280,000; it was listed this week at $229,000. Overflowing boxes were piled on the front porch, and a U.S. flag leaned against the siding.
The sale may have been a sign of financial troubles. Bales and his wife also own a home in Auburn, about 10 miles north, according to county records, but abandoned it about two years ago, homeowners’ association president Bob Baggett said. Now signs posted on the front door and window by the city warn against occupying the house.
“It was ramshackled,” Baggett said. “They were not dependable. When they left there were vehicles parts left on the front yard…we’d given up on the owners.”
…
Bales was deeply underwater on his home, and his wife was looking at executing a short sale in his absence. One has to wonder whether the financial stress was a contributing factor to the snap.
…
The house was put on the market Monday for $51,000 less than the couple paid for it in 2005, according to Seattle-based Zillow. But Rodocker said she left a voice-mail message the next day, asking that it be pulled off the market because of a “family emergency.”
The home is in a wooded area not far from Lake Tapps, a Pierce County area northeast of the base. A Realtor’s lockbox was attached to the front door Friday, and empty boxes, trash and other items were piled on the front porch.
…
Bales was deeply underwater on his home, and his wife was looking at executing a short sale in his absence. One has to wonder whether the financial stress was a contributing factor to the snap.
Extended enlistments (draft?), multiple deployments, previous combat injuries, wife adrift, finances in ruins, etc., hardly resemble those “transformers” recruiting commercials. We treat “never worked” welfare recipients better than our soldiers.
Dozens arrested at Occupy’s 6-month anniversary rally
Reuters
12:18 a.m. CDT, March 18, 2012
By Chris Francescani
NEW YORK, March 18 (Reuters) - Police arrested dozens of
Occupy Wall Street protesters on Saturday night during a protest
marking the movement’s six-month anniversary at its birthplace
in New York’s Zuccotti Park.
The sweep of the park by police just before midnight capped
a day of demonstrations and marching in lower Manhattan. There
was no official word on the number of arrests but dozens of
people were handcuffed and led out of the park.
Earlier in the day, 15 people were arrested and three
officers suffered injuries, police said.
Protesters reconvened at the park after the afternoon
marches petered out, and by 11 p.m. roughly 300 had gathered
there.
“This is our spring offensive,” said Michael Premo, 30, of
New York, who identified himself as a spokesman for the
movement. “People think the Occupy movement has gone away. It’s
important for people to see we’re back.”
…
Which Megabank?
UPDATE 1-Soldier suspected in Afghanistan massacre to meet with lawyers
Sat Mar 17, 2012 9:04pm EDT
* Bales described as level-headed, experienced soldier
* Defense team will review medical and personnel records
* Lawyer says family stunned but standing behind Bales
* Bales family owns two ‘underwater’ properties (Adds details of Bales personal and family history)
By Bill Rigby and Peter Henderson
…
Records show the Baleses own two properties, both of which are underwater, meaning the mortgage balances are greater than the value of the properties.
Their main home near Lake Tapps, a white house with four bedrooms about 45 minutes east of Tacoma, was recently listed for sale at $229,000, according to the online real estate service Zillow.com. But Zillow, citing public transaction records, shows they paid for $280,000 for it in 2005.
Another realty website, for John L. Scott Real Estate, promotes the property as a “short sale,” which occurs when a bank is willing to allow a homeowner to sell at a price below what is owed on the mortgage, accepting the loss on the remaining balance.
A smaller second property in the city of Auburn, about 10 miles to the north of their Lake Tapps home, was purchased by Karilyn Bales, then Karilyn Primeau, in 1999 for $99,500. While the property is assessed at $148,000, property records show it was remortgaged for the amount of $178,500 in 2006.
…
I sure wish the China bubble would just hurry up and collapse, so we can get on with the (eventual) global recovery.
Real Time Economics
Economic insight and analysis from The Wall Street Journal.
March 2, 2012, 4:32 PM
Housing Still Drowning in Underwater Mortgages
By Kathleen Madigan
$715 billion is a lot of money.
That’s the estimated amount of “underwaterness” hobbling the housing sector in the fourth quarter. A mortgage is considered underwater when the amount of the loan is larger than the value of the underlying property, resulting in a negative equity position for the owner.
The more negative equity a homeowner has, the more likely the owner will default. The resulting foreclosures are a negative rippling through the entire recovery.
As Federal Reserve Chairman Ben Bernanke told Congress this week, “problems in U.S. housing and mortgage markets have continued to hold down not only construction and related industries, but also household wealth and confidence.”
According to mortgage-data firm CoreLogic, 11.1 million of homeowners had an underwater mortgage in the fourth quarter, representing a large 22.8% of all residential properties with a mortgage. The share has not come down much since the recovery started in 2009.
Of those underwater borrowers, 6.7 million have only a primary mortgage, with an average negative equity of $51,000. Of the 4.4 million with first and second liens, the average amount is $84,000. According to CoreLogic, an estimated $715.3 billion in negative equity is floating throughout the housing market.
Until that negative equity is sopped up, housing will not recover and home prices will remain under pressure.
Policymakers have taken a shot at solving the problem. There has been little headway in part because of resistance from lenders and investors.
But the sheer magnitude of negative equity also hobbles any government solution. For instance, the latest idea agreed to by state attorneys general would help only about 1 million distressed owners–a drop in the bucket compared with the number of underwater owners.
Washington right now has neither the money nor the political will to provide big-ticket assistance to distressed homeowners.
Instead, the main tonic is better job and income growth. Already, the recovery has helped to lower the mortgage delinquency rate, if only a bit.
This path, however, carries the same risk that overhangs the overall outlook: the euro-zone debt crisis, spiking gasoline prices, and a China slowdown.
…
Last comment du juor (I promise!):
The real reason I post so much here is my sense of duty coupled with perception of an unmet need: So many MSM articles seem logically deficient, I feel a strong impetus to step up and connect the dots for them.
Anger is not really much of a factor for me these days, unless, of course, I really am angry but also in denial and hence oblivious to it.
But I don’t think I am…I feel reasonably content (maybe due to $4.99/bottle wine?).
Sweetie, consider the source. Anger takes many forms.
Is cantankerousness a form of anger? Perhaps you have a point.