Bits Bucket for May 19, 2012
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
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I have this feeling that something significant happened this week. Or maybe it is supposed to be significant, but in the way it seems odd to me. I’m talking about the Facebook IPO. Man, everyone seems kinda starry-eyed at ALL THAT MONEY! It’s probably because it’s personified. This person is worth a bazillion. A trifle, that person is worth ten bazillions!
But I can’t help but remember the dotcom days, and that ALL THAT MONEY has to come from somewhere. After all, they aren’t printing it at Facebook. I heard yesterday that 500 million shares traded on the first day. That must make Wall Street very happy. Oh, but isn’t that the same Wall Street thousands were protesting a while ago? The same “elite” that were running a casino economy? The too big to fail fat cats that got $700 billion bucks from the govt? For what, as a reward for making many billions gambling on houses and then losing at the end. And what is Facebook worth today, $80 billion?
But then even these guys are peons compared to the Federal Reserve. I was listening to the radio over a year ago, and the guy on NPR said the Fed had loaned out $13 trillion all over the world. What’s $80 billion compared to that! (Does Bernanke have a Facebook page? He could buy Facebook with couch change.) And we don’t know who got that money, what it was used for or if it was paid back.
And some defense authorization bill passed the house yesterday. I don’t know the details, but would any of us blink an eye if some line read, ‘we hereby authorize $300 billion for the new star-cruzer battle thingy’?
So I think about what money really is. That we’re told 40 million people in the US live in poverty. We all (or most of us anyway) work for this money; spending years learning to make more of it. Counting it, saving it. We get mad when someone tries to take it, or uses their money to do something we don’t like. Then something like Facebook comes along and we can conceptualize the amounts. ‘With that much I could own 100 houses. The biggest yacht. A football team!’
But over at the Pentagon, they can spend $80 billion on designing a new hood ornament for the hummer.
I remember when we would collectively get bent out of shape over military spending. $600 hammers, toilet seats for bombers that cost thousands, expensive weapon systems that didn’t work (remember the Sgt. York program?). Fast forward to today … almost no one cares anymore. But we get bent out of shape when a Lucky Ducky who used to be a member of the middle class uses an EBT card to feed his family.
Earmark Puts $17,000 Pans on Army Craft
http://www.nytimes.com/2012/05/19/us/politics/behind-armys-17000-drip-pan-harold-rogerss-earmark.html?hp
Tease:
But Bob Skillen, the chief engineer at a small manufacturer called VX Aerospace, which has a plant in North Carolina, said he was shocked to see what the Army was spending for the Black Hawk drip pans. He designs drip pans that his company sells to the military for a different helicopter, the UH-46, for about $2,500 per pan, or about one-eighth the price that his Kentucky competitor charges. The pans attach beneath the roof of the helicopter to catch leaking transmission fluid before it can seep into the cabin.
“It’s not a supercomplex part,” said Mr. Skillen, an aerospace engineer who used to work for the Navy. “As a taxpayer, I’m just like, this isn’t right.”
He took his concerns to members of Congress, to military contracting officials and, finally, to a government watchdog group, the nonpartisan Citizens for Responsibility and Ethics in Washington. The group requested documents from the government under the Freedom of Information Act last year to learn more about the contract.
The Army turned over some information but said it did not have any specifications or designs for the drip pans that might explain the price. That was considered proprietary information held by Phoenix Products.
‘The pans attach beneath the roof of the helicopter to catch leaking transmission fluid before it can seep into the cabin’
Man, wait till I get the contract to design the thing that stops the leak from happening in the first place! I think I’ll call it a gasket.
Speaking of gaskets….
You know those paper ass gaskets in public restrooms? I’ll wager they could be marketed to the DoD pigs at $50 each.
“The Army turned over some information but said it did not have any specifications or designs for the drip pans that might explain the price. That was considered proprietary information held by Phoenix Products.”
Well, that’s the end of the Republic, folks. The government is protecting the guys who are raping it.
Since the spenders obviously won’t stop, then we need a Tax Revolt. The beast can’t or won’t be stopped by direct action, so we’ll have to starve it… hence by inaction.
This is 100% absolutely correct.
Those in Washington DC and at the state level will listen to nothing - until there’s a massive tax revolt. A refusal to pay taxes is the only card the masses have left. (Funny thing is, the masses will always have this card, unless there’s a switch to communism or some such system).
It’s the only way to stop them, since reason, judgement, ethics and laws won’t.
Will there be bloodshed? That depends on how far The Massahs push on that string. The scary thing for The Massahs is that they never know just how far they can push before the unpredictable hell breaks loose.
“The government is protecting the guys who are raping it.”
BINGO.
Exhibit A: NAR, MBA, Phoney and Fraudie.
“A refusal to pay taxes is the only card the masses have left. (Funny thing is, the masses will always have this card, unless there’s a switch to communism or some such system).”
Given the withholding system currently in place, could you explain the actual logistics of such a tax revolt? You can’t do it by not filing. Most people get a refund.
Given the withholding system currently in place, could you explain the actual logistics of such a tax revolt? You can’t do it by not filing. Most people get a refund.
Ever been self-employed?
Ever been self-employed?
A revolt of the self-employed will lack sufficient number. Better hire some temps.
“You can’t do it by not filing.” Says who? You? You and I both know that there’s no federal law on the books stating that everyone must pay federal income taxes. Just because the government uses its imperial power to threaten and coerce doesn’t make it true.
Less threatening ways to not pay taxes include:
Bartering, as to remove movement of money/cash/credit and thus taxes. Nothing illegal at all with exchanging a gold watch for knee surgery.
Buy services (such as knee surgery) overseas.
Buy as much as you can over the internet. Food, clothes, medicine, energy (I don’t know about the latter, but there’s probably a way).
Only purchase direct from producers and manufacturers. Remove every pair of hands between you and that produce/service as possible. Remember that every step of the way, the government taxes it.
Grow it/build it/fix it yourself. Use and reuse. Darn your socks. Learn how to sew. Also legal.
Don’t buy things that incur tax. Only buy goods from other individuals that can be traded for other goods possessed by other individuals. You know, the garage sale/flea market route.
Start a church. Use tithe money to advertise Trade services on church picnic Sundays. I’ll trade you those two sides of beef for that electric generator.
Agree to have your ankle broken at age 55. Declare disability. Pay “taxes” on your “income”. Meanwhile, continue to barter.
Reduce your income while increasing your wealth. Live in a less expensive area so that things such as AMT won’t rob you blind.
Put cash in your mattress. Don’t pay capital gains or dividends by investing in valuable goods that aren’t taxed. Use your cash to obtain things that can be traded, not sold. Very legal.
Don’t use government services. Sadly, it may soon be illegal NOT to use government services. But yet our government uses its imperial powers only overseas.
Move your assets overseas (Oops! The government, in its thirst for money, is putting the kabash on this come January 1 2013. No surprise there. After all, your money is their money).
“Ever been self-employed?”
Sounds like a way to create big trouble for yourself.
Starving the beast won’t work. Politicians just borrow and spend. It’s beautiful in its perversity.
A lot of the things you listed primarily impact state sales taxes. Wouldn’t it just be easier to move to a state that doesn’t have one?
You can give your doc a gold watch for your surgery if you like and he is willing to take it. Expect him to charge you a huge premium over taking cash. And he still have to declare the value of the watch as income, so I’m not sure what you think you have accomplished.
Some of the others act primarily to concentrate income in the hands of the few. That increases tax revenue, doesn’t decrease it.
Some of your other proposals hurt the “little people” you keep telling Colorado to give his job to (and the less skilled).
And the rest hurt you.
I still don’t get it.
Tax revolt…lol…that will not stop them. They will stop…only when the bond market makes them stop.
to see what the Army was spending for the Black Hawk drip pans ??
If we are going to cut entitlement programs lets start right here because in many ways that is exactly what the Pentagon is…
Hate to tell you guys this, but airplane stuff is expensive.
Here’s my formula for estimating the price of airplane parts:
(What you think it should cost) X 10 =
“Drip pans” covers a lot of territory. What kind of “drip pan”?. Does the helicopter fly with it installed? If it does, it needs to be certified. Which means someone has to look at it to see if it does what it’s supposed to, it is designed correctly, and built of suitable materials, and won’t degrade the performance of other aircraft components.
Then, you certify that the manufacturer is capable of building the component “as designed”, and has the Quality Control system to confirm this, and can isolate the batches affected, if substandard materials/components slip thru the system.
These is no such thing as “mass production” in aircraft. Except for stuff like tires, light bulbs, and filters, production runs of 10,000 is about all you will ever see, and most have runs of a couple thousand, at best.
When I get an “8130″ tag with a part (even a light bulb, or screw), it means that all of these QC processes have been done. If a mechanic doesn’t have it, HE is personally responsible for making the determination that it is “airworthy”.
If I have to start doing that,
a) I’m getting out of the business, (and I won’t be the only one), because
b) it is impossible for me to make that determination.
Aviation engineered and certified + Very limited production + high reliability + fail safe design + product support departments + 25-50 years of Product Liability insurance = expensive parts.
Of course, we can “de-regulate” the whole process, and let every hillbilly with a hammer and an anvil, build and sell airplane parts………
Except that the person who originally got upset was an engineer with another firm that makes a similar item for a different helicopter for less than $3000. I know it isn’t something that can be found in a catalog of mass produced parts for $10. And that you have to amortize the cost of the tooling and all that over a much smaller run. But here is some more from the article:
Tom Wilson, who owns Phoenix Products, defended his company’s pans as better constructed and more durable than others on the market. Asked what made them so costly, he declined to discuss specifics, saying that disclosure of the company’s custom design could help competitors or even aid America’s enemies.
Mr. Wilson and his wife, Peggy, who is the president of the company, have been frequent contributors to Mr. Rogers’s political committee, as well as to Republican groups. The company has paid at least $600,000 since 2005 to a Washington lobbying firm, Martin Fisher Thompson & Associates, to represent its interests on federal contracting issues, records show.
Mr. Rogers, in turn, has been a strong supporter of the manufacturer. He has directed more than $17 million in work orders for Phoenix Products since 2000.
Mr. Wilson said he did not think that his company’s relationship with Mr. Rogers or its Washington connections were a major factor in the Army’s decision to buy his pan. His company got the work, he said, because its drip pan was “just simply a better product.”
But with the military facing $55 billion in budget cuts on Jan. 1 and Defense Department leaders warning of dire consequences, others are not so certain.
“You have to wonder,” said Ryan Alexander, the president of Taxpayers for Common Sense, a nonpartisan group. “Is the Pentagon really getting the message?”
The Kentucky company, Phoenix Products, got the job to produce the pans after Representative Harold Rogers, a Republican who is now the chairman of the House Appropriations Committee, added an earmark to a 2009 spending bill.
Hal Rogers is the king of pork, much beloved for it in his (conservative) home district- where he’s been the Republican rep since 1981!
So, basically, the problem is the guy in NC didn’t spend enough to buy his Congressman?
Wake me up when someone gets charged with ripping off the government. At least we got state of the art drip pans off this deal.
I remember it, too. Like when everyone was vitriolic when in the 1980s Nancy Reagan spent money on new china for stateside visits at the White house. Today, no one cares that our politicians spend tens of millions on lavish parties in South America.
Money spent on Obama’s daughters birthday parties and golf games could be better spent, I agree.
Oh - have you divvied up your $125/hr. side job yet? How about your $100K+ job? Or, are you okay with former middle class workers using EBT cards.
Bet not.
‘have you divvied up your $125/hr. side job’
I don’t know, but I just made a billion buckaroos in 1 minute, and don’t give me that do-goody-good buuulll ch*t.
Missed the Floyd reference yesterday…nice work.
“Oh - have you divvied up your $125/hr. side job yet? How about your $100K+ job?”
Hey doofus, I can’t do that no matter how much I try.
“Or, are you okay with former middle class workers using EBT cards.”
You mean you’d rather see them go hungry?
Inequity is great when it works on your favor, isn’t that true, In Colorado?
You’re so full of it. You’re just mad that you don’t have enough money to be the limosine liberal you so badly want to be.
Rather than make a true sacrifice - like half of your $100K+ income and $125/hr. side job - you’d rather profess How Much You Care for the little guy.
What a pantload of b.s.
$100K+ annually per year falls into what percentage income bracket, In Colorado? Upper 3%? Upper 5%?
‘you don’t have enough money to be the limosine liberal’
I’d like to be a limousin anything. Make a that a corporate jet anything.
Why should I sacrifice half of my salary? Would that help the Lucky Duckies in any way? That sounds more like a 1%er wet dream, as they would be the sole beneficiaries from my sacrifice.
You’re just mad that you don’t have enough money to be the limosine liberal you so badly want to be.
Liberal? Oh that’s rich. So being worried about my kids’ future and whether or not they’ll be stuck as Lucky Duckies makes me a “liberal”? Wow. Now I remember why I quit the GOP and became an independent. The inmates took over the asylum. And your proposed solution is for me to join the ranks of the Lucky Duckies. Whatever you’re smoking … I don’t want any.
$100K+ annually per year falls into what percentage income bracket, In Colorado? Upper 3%? Upper 5%?
Using family income as a metric, we are in the top 25%, and that includes my wife’s income. The Median Family income for a married couple is just shy of $80K in the Centennial State.
I’d like to be a limousin anything. Make a that a corporate jet anything.
I’m more worried about becoming a Lucky Ducky. I’ve seen it happen to far too many people to believe it can’t happen to me.
I would, too! Though I’d rather have a hydrofoil zipping along the top of the ocean at a fast clip. I want that feeling of freedom, man! I wonder if beer spills if rested on the bottom of a hydrofoil? It doesn’t on speed boats…
It’s sad that In Colorado would like that limosine as well, but cannot come to grips with that fact, hence the hypocrisy. It’s really rather depressing. All the bragging about the big income/s, a $350K house and living on the Front Range…while at the same time cutting down those Lucky Duckies that live in “lesser” places such as the repulsive Greeley, Colorado.
In Colorado doesn’t even recognize his own incredible good fortune. He’s easily a 1%er.
He needs to actually DO something to deal with his extremely fortuitous lot in life. Clearly, he struggles with it.
Take a gander at some of these, In Colorado. You should look at the Cassie’s Unplanned video, if nothing else. You could do this, too. But do you have the ‘nads? The conviction? Really? Prove it.
http://www.youtube.com/user/MomentsChannel
makes me a “liberal”? Wow. Now I remember why I quit the GOP and became an independent ??
Ditto here….
“”I’d like to be a limousin anything. Make a that a corporate jet anything.”
You mean like, BILA?
A guided-missile libertarian?
Now I remember why I quit the Democrat party…
“liberal”
Talk about a pantload of BS. Pull your head out of your ass buddy. Until you accomplish that, you’re part of the problem.
Clown.
I now realize that part of being a blogger is a vow of poverty, but a guy can dream.
Poser when the right stops using medicare medicaid, social security etc maybe Colorado will donate 50% of his salary.
As the US moves more and more to 3rd world income distribution you and your ilk will find that your jobs and quality of life also depended on a strong middle class. It’s surreal to see people in my state who have had their jobs outsourced, their benefits stolen, and seen the safety net pulled out from under them wax on like Poser, I’ve seen small business owners loose their shops due to a shrinking middle class do the same. I keep thinking that at some point reality will kick them in the head hard enough that they get it.
“I now realize that part of being a blogger is a vow of poverty, but a guy can dream.”
I suspect a blogger’s problem is similar to Facebook’s problem: Even though the service provided is valuable, no one just yet has figured out a really great way to generate revenues.
Zuckerberg figured out something important, which is that if you can market your concept to enlist VC firms and Wall Street involvement with developing and selling an IPO, revenues no longer matter.
Comment by Posers
2012-05-19 10:43:47
Now I remember why I quit the Democrat party…
I don’t think you’re old enough to vote.
“Now I remember why I quit the Democrat party…”
I can’t quit you!
“Zuckerberg figured out something important, which is that if you can market your concept to enlist VC firms and Wall Street involvement with developing and selling an IPO, revenues no longer matter.”
I was in a new company pitch for a group called “garage.com” way back in 1999-2000 (or thereabouts). The guy pitching his idea said essentially “we have seen that you don’t need revenues to make money, just eyeballs”.
My partner and I left the meeting shaking our heads essentially saying to ourselves in the car “this thing (dotcom boom) is insane, and over”. I think that roughly marked the peak before the slide down…neither of us were risk-loving enough to short the market, but neither were we invested in tech at the time either.
While I think people are bound to make the same mistakes again, I don’t think they are as apt to make the same “no revenue+lots of eyeballs=huge value” to the same extent as before.
Google has proven that an advertisement model can work (albeit to a small extent–search is still the cash cow). However, it is unclear how much money such a model can really make…and investors know it.
And thus the flat FB IPO. If anyone can make a lot of money from the eyeballs to ad sales, it’s a company with hundreds of millions of eyeballs. That said, the value is unbelievably rich based on their current revenue/earnings. You really gotta believe that they can figure out how to make A LOT more money with all the users…
I don’t think they are worth $0, like a lot of the dotcom boom companies. However, I think their true value based on ability to make money is far less than $100 Billion.
Too risky for me…only a trader’s company, not an investor’s.
“1980s Nancy Reagan spent money on new china”
I don’t think the taxpayers spring for the White House china.
Someone set up a charity. Wealthy people donated the money for the china. Given the tax rates at the time, taxpayers probably paid a little less than half. The Reagans sure didn’t pay for it.
And the White House had plenty of china at the time. But she wanted servide up to a certain number (I don’t remember that at all) to match. And to be red.
Right you are. Nancy Reagan spent donated money for the china and other White House trimmings. Did not stop the media from attacking her endlessly also for her love of high fashion. She probably spent a fraction of what Jackie Kennedy spent (reportedly over a million per year in early 1960 dollars - bankrolled by old Joe Kennedy.) But because Nancy was a Republican not a Democrat you would have thought she was roasting babies alive and eating them.
“Fast forward to today … almost no one cares anymore. But we get bent out of shape when a Lucky Ducky who used to be a member of the middle class uses an EBT card to feed his family.”
But how many truly object to that versus are responding as expected from decades of propaganda?
I remember when we would collectively get bent out of shape over military spending. $600 hammers, toilet seats for bombers that cost thousands, expensive weapon systems that didn’t work (remember the Sgt. York program?).
But we got internet out of it. It’s all good, no?
But we got internet out of it. It’s all good, no?
If it took $600 hammers to get us the internet, then yes, it was worth it.
No offense butters, but only a complete imbecile would think that the internet- probably the most important invention since the printing press, possibly the most important invention ever- is a small achievement.
I remember when we would collectively get bent out of shape over military spending. $600 hammers, toilet seats for bombers that cost thousands
That was the brilliance behind the star wars program. Everyone knows a hammer isn’t worth $600, but they have no idea how much a laser system should cost.
Ben, the mood in the valley is positive now. It’s got an eerily similar feeling to the dot-com bubble. Personally I don’t think we’ll see anything like that.
What does amaze me is the length of peoples’ memories. Nothing has been done to address the structural defects in our economy. Nothing has been done to address the vampires at the Fed, etc.
But happy days are here again! Mark Z is worth 500 kazillion $$.
I will make hay while the sun is shining but my long term goals remain the same. After having seen a number of small to large booms here, I think I have enough tenure to see it for what it is. Pure hype & BS.
Once again, they’re partying like it’s 1999.
And remember that 1999 was followed by 2000, and that’s when the NASDAQ went into a steep dive. It’s still trading at just slightly more than 50% of its early 2000 value.
In 1999, I was a controller at a dotcom. Upstairs there was a day trading company. (Talk about a building full of idiots, and I was sitting there with them). The owner of the day trading outfit came walking into the lobby one day and announced, ‘Yahoo is now worth more than all the ‘big three’ auto producers put together.’
Our biggest customer was Coca Cola. Always paid their bills on time. The second biggest was MCI Worldcom. They never paid their bills on time. It made me wonder how come a company that made sugar water was more responsible than the tech ‘giant.’
This is why California - oops, I mean Greeceafornia — has the reputation is does.
It’s not a good reputation, unless you’re Greeceafornian.
“This is why California - oops, I mean Greeceafornia — has the reputation is does.”
And what would all the welfare states do if California went away?
The owner of the day trading outfit came walking into the lobby one day and announced, ‘Yahoo is now worth more than all the ‘big three’ auto producers put together.’
Was that a sell/short signal?
“And what would all the welfare states do if California went away?”
Look for a different role model.
Perfect!
the mood in the valley is positive now ??
I agree….Having gone through 5 recessions in this valley in my working life there is one thing that I have learned…Watch the big dogs…When the big dogs get off the porch and get busy there is something coming over the horizon….Thats exactly what has been happening here for the past year and now the minions are following…How it all ends is anyones guess but for now its very, very real…
That was the impression I got when I visited a few weeks ago. From their perspective the good days are back, unlike in flyover country.
“Pure hype & BS.”
I’m the last guy to be a Facebook Fan…and I won’t be here.
I’m also the last guy to be buying the Silicon Valley Kool Aid–rents are rising way too fast for commercial in Mountain View, and new companies need very few employees.
HOWEVER, we may be seeing the birth of a new kind of entertainment industry….Hear me out…
Google is all about utility.
Facebook is all about leisure time.
Therein lies the key difference between the two businesses.
My biggest question is over time, how Facebook users are going to split their time between Facebook and other online leisure activities. It’s the growth of those other online leisure activities that are including a greater and greater social component (that may or may not have Facebook as part of their ecosystem).
Zynga? Trying to not be so tied to Facebook.
Pinterest?
What’s next?
All of these other web leisure options are going to pull eyes away from Facebook in time, and create other businesses. Plenty of them will be located in Silicon Valley given the confluence of experience, capital, and willingness to take risk.
Needless to say, I’m not a buyer of Facebook at anywhere close to its current price.
Think of the birth of Television…a few channels to start, who dominated viewership, because there was nothing else…now there are hundreds of channels, and those original few get many fewer eyeballs.
“ALL THAT MONEY!”
Start loaning out large amounts of it on easy terms to college students with weak future job prospects, and pretty soon you have a real problem on your hands.
A Generation Hobbled by the Soaring Cost of College
Photographs by Ruth Fremson/The New York Times and Ty William Wright for The New York Times
Taking on debt has become a central part of the college experience for many students.
By ANDREW MARTIN and ANDREW W. LEHREN
Published: May 12, 2012
ADA, Ohio — Kelsey Griffith graduates on Sunday from Ohio Northern University. To start paying off her $120,000 in student debt, she is already working two restaurant jobs and will soon give up her apartment here to live with her parents. Her mother, who co-signed on the loans, is taking out a life insurance policy on her daughter.
“If anything ever happened, God forbid, that is my debt also,” said Ms. Griffith’s mother, Marlene Griffith.
Ms. Griffith, 23, wouldn’t seem a perfect financial fit for a college that costs nearly $50,000 a year. Her father, a paramedic, and mother, a preschool teacher, have modest incomes, and she has four sisters. But when she visited Ohio Northern, she was won over by faculty and admissions staff members who urge students to pursue their dreams rather than obsess on the sticker price.
“As an 18-year-old, it sounded like a good fit to me, and the school really sold it,” said Ms. Griffith, a marketing major. “I knew a private school would cost a lot of money. But when I graduate, I’m going to owe like $900 a month. No one told me that.”
…
I fixed the open html link for you. That will be one billion dollars, please.
Sorry about that; I haven’t figured out how to get the Joshua Tree Extension going with Firefox 12.0, so I have been typing my html tags on the fly lately.
Is the one billion dollar loan forgivable on death, like student loans are*?
*Which reminds me, aren’t student loans normally forgivable on death of the student? For this reason, I found it puzzling the mom would take out a life insurance policy on her daughter. Perhaps the loans were not of the federal variety which are forgiven at death? Or was it that mom’s cosigning the loans invalidated the forgiveness clause?
Federal student loans aren’t necessairly forgiven at death. The servicer could make a claim in the decedent’s probate proceeding if there was one. If there is no probate, or estate, to make a claim against, the loan would be discharged as noncollectible.
Of course, some assets, like life insurance, pass outside of probate and would not be subject to the servicer’s claim.
In the foregoing scenario, it appears the mother must be a co-signer.
A few posters have recently complained about me linking articles here. The reason I do this is because of my interest in discussing reality, not some baseless opinion.
Those who don’t like my practice of trying to ground my posts in reality should stop reading them, because I don’t plan to change.
WEEKEND INVESTOR
August 7, 2010
When Student Loans Live On After Death
By MARY PILON
In July 2006, 25-year-old Christopher Bryski died.
His private student loans didn’t. Mr. Bryski’s family in Marlton, N.J., continues to make monthly payments on his loans—the result of a potentially costly loophole in the rules governing student lending.
As the college season nears, throngs of parents and students still are applying for private student loans, long used by students as an alternative to federal loans. But they may be unaware that in cases where the student dies, the co-signers often are obliged to pay off the balance of the loan themselves—a requirement typically not found in federal loans.
…
co-signers
That means you signed on to pay the debt. Period.
“That means you signed on to pay the debt.”
I get that.
Why a student and her mom would take out a loan on those terms is beyond me.
My parents co-signed on $10k of my student loans (a real beauty at 10.5%). They didn’t sign on the rest.
Needless to say, that was the first loan to repay.
“That will be one billion dollars, please.”
CIBT can easily pay that, thusly: He signs a contract for the billion dollars, due and payable at 8% yearly interest in 30 years. You then take this contract and sell it on the open market to investors, earning fat fees in the interim so that you can live like a king. Within 5 years or so, the contract’s worth will be doubted, so your investors panic, and then you just apply to the government to buy the contract out at 98 cents on the dollar.
CIBT just walks, but you’ll be a billionaire, so you won’t care.
See? With stupid investors and corrupt government, Big Finance is easy!
Are you looking for a business partner?
LOL +1 Ben…
“‘As an 18-year-old, it sounded liked a good fit to me, and the school really sold it,’ said Ms. griffin, a marketing major.”
LOL, a MARKETING MAJOR!
A marketing major falling for a marketing scheme that sticks her with a huge bill so as to allow the marketers to live a life of ease?
Anyone here wonder just how it is that the much reviled One Percenters end up with so much money?
This is why I like Vince’s idea so much…about buying a manufacturing space for an 18-year-old kid to learn a trade, rather than blow a similar wad of dough on an increasingly worthless college education taught by greedy, know-nothing academes.
I like this idea, too. What will the market be like when everyone is doing it?
“A marketing major falling for a marketing scheme that sticks her with a huge bill so as to allow the marketers to live a life of ease?”
Was she a marketing major when she signed the initial loans? After that, she was hooked.
“I heard yesterday that 500 million shares traded on the first day. That must make Wall Street very happy. Oh, but isn’t that the same Wall Street thousands were protesting a while ago?”
Hence my contempt for the Occupy Wall Street faux protesters. How many of those have bought into the Facebook IPO? How many had accounts based on Wall Street in the first place? How many would be borrowing madly at their local Bank of America branch as soon as they scored a job? How many will keep borrowing for education? We all know the answer: Most, if not all of them.
Until Americans start aligning their actions with their so-called sense of social justice, all this will just get worse. Americans need to act like the 99% they profess to be.
I hear Facebook was trading at over 80 times earnings. We learned nothing from the dotcom fiasco. All Americans do is get a sniff of “easy money” and they lose their mothereffin’ minds. Since that only leads to concentrating wealth into an ever-smaller percentage, we’re going to transform the nation into a Second World area.
Great post, but be careful of traps disguised as “social justice”. Read this:
http://www.freetheworld.com/release.html
More right-wing “libertarian” claptrap disguised as peer-reviewed scientific literature from the Frasier Institute. Home of big oil, big lumber, big strip mining.
Next.
“Hence my contempt for the Occupy Wall Street faux protesters. How many of those have bought into the Facebook IPO?”
Huh?
I thought they were deadbeats who needed to take a bath, put down the joint and get a job.
Now they’re members of the investor class?
Wow, In Colorado. What a way to exemplify Better’s third paragraph.
How’s that $100K+ annually salary doing ya these days, In Colorado? That $125/hr. side job?
What are you doing with all that money? Helping Lucky Duckies with their medical bills via personal check?
Nope.
How does making all that money and living in that $350K house - in that beautiful location - square with your ongoing blather about social justice?
Don’t worry. I get it.
You are virtuous. Society isn’t.
Posers, could you please explain to us why you conflate advocating for social justice with divesting oneself of one’s (apparently quite modest) earthly goods?
One supposes InColorado could donate his kidneys to needy dialysis patients, offer up his house as firewood to warm the shivering masses, stop feeding his family in favor of sending food off to those who are starving, but then we’d have to raise your taxes to take care of him. Or better yet, we could just let him starve and die of renal failure then sell his children for body parts to pay down the national debt!
This “if you’re so worried about the poor, why don’t you write a big check to the government” silliness is really beneath even your simplistic reasoning. Sounds more like a lame Fox News talking point than a rational argument, actually.
People knock Michael Moore for being a rich democrat. I have no problem with wealthy people…
I think where we differ, is where do we set the floor? Posers position doesn’t square well with being a teacher, whose every effort is to level, at least in part, the playing field through knowledge. Of course family connections and money matter, but education truly frees people’s minds.
Some days I am bewildered at the thought that he is a teacher. Hey Johnny, if we all can’t have apple sauce, then I suggest the whole class go hungry.
“advocating for social justice”
Tell everyone exactly what social justice means…tell the truth, the whole ugly truth.
Here’s what it’s not, nicky:
http://www.youtube.com/watch?v=W4DKLqnyBAQ
Same thoughts here Colorado….
I was confused why Ben thought there was overlap between the 2 groups.
I hear Facebook was trading at over 80 times earnings. We learned nothing from the dotcom fiasco ??
I totally disagree….I think the trading in facebook yesterday clearly shows that the retail investor was absent…They “did not” buy into the hype and the hype was about as big as I have ever seen here…
So who bought it? I read that 200 million+ plus shares were traded.
Please don’t tell me Bernanke was buying them……
Doesn’t the fact that it traded flat tell you something ??
Particularly with the biggest hype roll-out in IPO history ??
The stock was priced to perfection and the retail investor was obviously absent….
They learned their lesson in the Dot-Com bust and again in 2008…
The underwriter had to support the price.
The underwriter had to support the price ??
Another example that there was lack of support from the retail investor…
The underwriter had to support the price.
Basically backstopped by taxpayers? Didn’t we bail out MS not long ago?
I remember well the fall of 1999, and our company CFO chatting with us in the lobby before a trip.
Said he couldn’t understand what kind of metric that Wall Street was working from, where Pets.com was “worth” more than companies that actually produced stuff at a profit…..like ours.
Go##am Dinosaur.
Hence my contempt for the Occupy Wall Street faux protesters. How many of those have bought into the Facebook IPO? How many had accounts based on Wall Street in the first place? How many would be borrowing madly at their local Bank of America branch as soon as they scored a job? How many will keep borrowing for education? We all know the answer: Most, if not all of them.
Wow how many straw men arguments can you fit into one paragraph? If you know the answer can you please post it and the source of your information.
The reality is that the main issues that OWS started with are things that many on the right and left agree with. My guess is like the Tea Party they were taken down from within. I see that many here lap up the propaganda and hate and ask for more.
We all know the answer: Most, if not all of them.
Speak for yourself, I find your assertions illogical to the point of absurdity. Posers agrees with you wholeheartedly, so I rest my case.
They could have used this headline instead: “FB IPO plagued by trade disorder”
Bloomberg News
Trade Disorder Plagues Nasdaq Handling $16 Billion Facebook IPO
By Nina Mehta on May 18, 2012
Facebook Inc.’s (FB) (FB) debut on the Nasdaq Stock Market turned into another setback for American equity exchanges, with the $16 billion initial public offering plagued by delays in trade confirmations, crossed quotes and signs that orders were mishandled.
The pricing of the first transaction (FB) took a half hour longer than Nasdaq planned. About 30 minutes later, the second- largest U.S. equities exchange operator reported an issue confirming trades (FB) from the opening auction with the brokerages that placed them. Nasdaq later established an appeals process for investors whose instructions weren’t carried out.
…
One of the more interesting aspects of the FB IPO: It dropped on the market on a day when fundamentals, such as fresh rumors of Eurozone bank runs, would otherwise have favored a much more substantial Wall Street selloff.
Biz Break: Facebook’s IPO underwhelms as Wall Street, other social media stocks plunge
By Jeremy C. Owens
Posted: 05/18/2012 02:38:17 PM PDT
Updated: 05/18/2012 04:36:43 PM PDT
Bloomberg TV anchor, Emily Chang, poses for a photo in front of the thumbs up sign at Facebook Headquarters, in Menlo Park, on Friday, May 18, 2012. (Karen T. Borchers/Mercury News)
Today: Facebook fails to rise substantially in its first day of public trading, closing near the price it sold the shares in its initial public offering as technical glitches plague Nasdaq. Also: Wall Street closes its worst week of the year with more losses, and social media stocks lead the indexes down.
Highly anticipated public debut of Facebook fails to live up to hype
After months of intense coverage and a final week that saw higher prices and more shares offered, Facebook stock finally hit the markets Friday.
The result: Nearly nothing.
…
I spent a few decades in the military - there is no doubt alot of waste there.
But the Federal Budget currently breaks down:
Military - 20% and shrinking
Entitlements - 55% and growing
And the feds borrow 40% of every dollar spent.
http://en.wikipedia.org/wiki/United_States_federal_budget
Google’s market cap is greater that the top 10 biggest defense contractors combined.
There is no path to fiscal sanity solely on the premise of cutting the military to the bone.
Everything needs to be cut.
Good post, and I agree.
The entitlements that retired military veterans expect to get will disappear, too. There will be no choice but to make significant cuts.
Simpson/Bowles is the solution:
http://www.fiscalcommission.gov/sites/fiscalcommission.gov/files/documents/TheMomentofTruth12_1_2010.pdf
What the government spends is no surprise once you look under the hood.
We spent ~150+ man hours filling out government forms so that we could report to the government that we are exempt from reporting MORE detail to them.
Someone on the other end needs to review this (ie. our forms that say we don’t need to report more).
Try signing a lease with a government agency as opposed to private industry.
1. The red tape and time expenditure is enormous;
2. The focus on bottom line cost is less than with large companies, which is less than small companies.
I may have misinterpreted what I saw on the news, but I think the underwriting banks for the Facebook IPO owned the majority of the shares traded by the end of trading Friday.
The unholy alliance between megabanks and governments is sure to end badly.
How did so many governments end up entrusting their finances to private megabanks, making said banks definitively too-big-to-fail? Or has it actually always been this way, and I just wasn’t paying attention before?
Europe’s debt crisis joins governments and banks at the hip
In Greece, Spain and elsewhere, much of the national debt is owed to the countries’ banks, and disaster for one would almost certainly spell doom for the other.
…
By Henry Chu and Lauren Frayer, Los Angeles Times
May 19, 2012, 5:02 a.m.
LONDON — The alarm over potential bank runs in Greece and Spain this week has highlighted an often-overlooked fact: Europe’s debt crisis is also, in many ways, a major banking crisis.
In capitals such as Athens, Madrid and Rome, large portions of the sovereign debt racked up by spendthrift governments are owed to the countries’ own banks, locking governments and the banks in an embrace so tight that disaster for one would almost certainly spell doom for the other.
International bailouts for Greece, Ireland and Portugal have helped to keep not just their governments but also their banks afloat, as well as financial institutions in other parts of Europe with large exposure to those nations’ debts.
Though worried investors have mostly focused on the dire consequences of government default, reports of depositors pulling out large sums in Greece and Spain are shifting attention to those beleaguered banking systems and the catastrophic effects of a full-on run.
On Friday, the Fitch ratings agency downgraded the creditworthiness of five Greek banks. That followed a similar demotion of 16 Spanish financial institutions by the Moody’s ratings firm Thursday evening.
Neither of the two Mediterranean nations is yet experiencing anything close to a major run on their banks, analysts say. There are no lines of frightened customers desperate to withdraw cash, and the banks in both countries together hold hundreds of billions of dollars’ worth of euros.
But with the euro crisis having reached yet another feverish pitch, stock markets and the values of banking shares are yo-yoing wildly.
“It’s the uncertainty that’s the principal reason for alarm in this,” Iain Begg, an expert on European economy and finance at the London School of Economics, said Friday.
…
How is the Greek bailout cargo cult holding up these days?
Europe’s stricken banks wait for a rescue that never seems to come
There are four weeks to go before the Greek elections – and, it seems, even longer to wait before a German change of heart on bailing out lenders. But fearful markets, and hard-pressed electorates, may not be patient much longer
Heather Stewart
The Observer, Saturday 19 May 2012
El moment es verdad…
Krugman: Comes the apocalypse
By Paul Krugman
The New York Times
First Published 8 hours ago
Suddenly, it has become easy to see how the euro — that grand, flawed experiment in monetary union without political union — could come apart at the seams. We’re not talking about a distant prospect, either.
Things could fall apart with stunning speed, in a matter of months, not years. And the costs — both economic and, arguably even more important, political — could be huge.
This doesn’t have to happen; the euro (or at least most of it) could still be saved. But this will require that European leaders, especially in Germany and at the European Central Bank, start acting very differently from the way they’ve acted these past few years. They need to stop moralizing and deal with reality; they need to stop temporizing and, for once, get ahead of the curve.
I wish I could say that I was optimistic.
The story so far: When the euro came into existence, there was a great wave of optimism in Europe — and that, it turned out, was the worst thing that could have happened. Money poured into Spain and other nations, which were now seen as safe investments. This flood of capital fueled huge housing bubbles and huge trade deficits. Then, with the financial crisis of 2008, the flood dried up, causing severe slumps in the very nations that had boomed before.
At that point, Europe’s lack of political union became a severe liability. The state of Florida and Spain both had housing bubbles, but when Florida’s bubble burst, retirees could still count on getting their Social Security and Medicare checks from Washington. Spain receives no comparable support. So the burst bubble turned into a fiscal crisis, too.
Europe’s answer has been austerity: savage spending cuts in an attempt to reassure bond markets. Yet as any sensible economist could have told you (and we did, we did), these cuts deepened the depression in Europe’s troubled economies, which both further undermined investor confidence and led to growing political instability.
And now comes the moment of truth.
…
I think the lesson of the Euro is, you need political union before financial union. It would be as if people who are dating combine their bank accounts before they’re able to live together. A country unable to print its currency is a curious chimera. Willing away tribal divisions didn’t work in Iraq and Yugoslavia. I don’t see it working in Europe and all the ethnically and linguistically distinct countries suddenly decide to speak the same language and open their borders.
I think the lesson of the Euro is, you need political union before financial union.
We are not looking hot either. Same language, same culture and new country founded on a strong constitution. Our problems are much bigger than Euro’s.
I propose a contest. Let’s split up the country, and see which part turns into Somalia first.
Call one country “North Semi-LibroAmero” (Basically, the Civil War “Union” states, Northern Plains states. Economy based on Wall Street and their fluffers, exporting manufacturing from South ConfundoAmero, some natural resources and manufacturing)
Call another “South ConfundoAmero” (The old Confederacy, Oklahoma, Arizona, New Mexico, and Alaska. Economy based on Corporate Mercanaries/Guns for Hire, agriculture, stealing manufacturing from North-SemiLibro with government bribes/”Tax incentives”, the Fundie-Christian version of “Sharia Law” and Chinese/Nigeria-like environmental and labor regs)
The third will be “West GodlessHeathenAmero” (West Coast states, all states on/west of the Continental Divide. Economy based on IPOs, Entertainment, agriculture/marijuana, and porn).
West GodlessHeathenAmero will soon pronounce porn and marijuana as a “Natural Resource”, and slap a severance tax on all exports, immediately solving all of their budget problems.
This will cause SouthConfundoAmeros to declare war on GodlessHeatho, as high priced porn will cause the locals to riot, and the PTB will deflect the blame onto the GodlessHeathos.
Why split to only 3? Let’s make it 50.
Oh wait…..
Let’s make it 50.
The true, mostly unspoken goal of the neo-libertarians.
“The true, mostly unspoken goal of the neo-libertarians.”
Yeah, it would really suck if you could not dictate your social justice and political correctness to everyone in the country.
In 1981 Joel Garreau, a writer for the Washington Post, wrote the book: The Nine Nations of North America (Houghton Mifflin, Boston).
Your comment, X-GSfxr, reminded me of the book.
The Nine Nations he wrote about were Quebec, New England, The Foundry, Dixie, The Islands, The Breadbasket, Mex-America, The Empty Quarter, and Ecotopia.
I remember it was a very interesting read back in 1981-82. Here’s a link I found doing a google search. It opens up a 14 page PDF file.
http://www.umkc.edu/whmckc/PUBLICATIONS/MCP/MCPPDF/Garreau-9-10-81.pdf
When the MSM starts talking about a “bank run,” doesn’t that suggest a bank run is already underway?
Only the ECB can make it a bank run: James Saft
James Saft Reuters
First Posted: May 17, 2012 - 8:03 am
Last Updated: May 18, 2012 - 4:17 pm
(Reuters) - A spreading bank run could hasten Greece’s exit from the euro zone but it certainly doesn’t have to end that way.
It is far less clear what the impact would be should the wave of withdrawals accelerate in other peripheral states such as Spain or Portugal, which are further from outright revolt over German-led austerity, and which, due to their sheer size, will enjoy a vastly improved negotiating position.
Greeks have been withdrawing hundreds of millions of euros of deposits from their banks in recent days, driven by a rational but dangerously self-reinforcing fear that a Greek exit from the euro will leave them holding far less valuable new drachma.
That fear, though, is predicated on a shaky notion: that the players in the drama will do what they have said they would.
Greek depositors are worried that their politicians will repudiate the terms of the bailout and that the ECB and European authorities will, ultimately, cut them off, either directly or by refusing to accept dubious collateral in exchange for fresh euros.
That would bring down the Greek banking system, or most of it, and force Greek authorities to impose capital controls. Cue Spanish, Italian and Portuguese depositors, who might follow suit and start to withdraw their own deposits, putting massive amounts of collateral into the hands of the ECB and their own central banks.
…
It must feel like the start of another long weekend for Wall Street bulls.
Wall St Week Ahead: The market is oversold, but major signs say “sell”
The U.S. flag hangs outside the New York Stock Exchange November 9, 2011. REUTERS/Brendan McDermid
By Angela Moon
NEW YORK | Fri May 18, 2012 6:35pm EDT
(Reuters) - Normally a big decline would set up Wall Street for a technical rebound. But that may not be the case next week, even after the market posted its worst weekly loss for the year and the S&P fell for six straight sessions.
With the corporate earnings season drawing to an end and recent U.S. economic data raising doubts about the pace of growth, the S&P 500, which is down 7.3 percent so far in May, could decline further next week as concerns about the financial health of Europe persist.
“What has changed in the world since April? We went from hearing a constant refrain that the world is awash in money and markets must go higher to hearing nobody wants to take any risk. … All in a week,” said Peter Cecchini, global head of institutional equity derivatives at Cantor Fitzgerald & Co in New York.
The S&P 500 fell 4.3 percent for the week, its steepest weekly decline this year, and closed below 1,300 for the first time in four months.
The hotly awaited market debut of Facebook on Friday was marred by technology glitches on the Nasdaq in sending messages back to the brokerages that handled orders of Facebook Inc (FB.O) for individual, or “retail,” investors. Those problems rekindled fears about the market’s electronic trading system and caused some investors to stay away from equities.
Weighing on sentiment is a growing sense among investors that the euro zone debt crisis is nearing new heights, fueled by fears of the potential for a Greek euro exit and the deteriorating health of the Spanish banking system.
…
What are the potential implications of the G8 meeting for resolving the Eurozone debt crisis? (I personally always expect announcements of future bailout plans to follow these high-level meetings…)
Wall Street falls before G8 leaders meet on euro zone
Published: Friday, 18 May 2012 | 3:27 PM ET
NEW YORK (Reuters) - Stocks fell on Friday as investors turned cautious before leaders of the Group of Eight nations met about the euro zone debt crisis and after a shaky market debut by Facebook Inc .
The S&P 500 dipped below the 1,300 level, seen as a key support point, for the first time since mid-January, before the meeting by the leaders of the world’s major industrial economies near Washington.
Leaders will try to confront the continuing crisis in the euro zone, including the increasing likelihood of a Greek departure from the bloc.
Growing concerns that global growth will suffer from the euro zone’s problems and signs of a slowing U.S. recovery have put the S&P 500 on track for a sixth straight day of declines and its worst week since November. The broad market index has dropped 7.3 percent so far in May.
…
Oh to have been a fly on the wall listening in to this conversation:
World Leaders at U.S. Meeting Urge Growth, Not Austerity
By HELENE COOPER
Published: May 19, 2012 9 Comments
CAMP DAVID, Md. — Leaders of the world’s richest countries banded together on Saturday to press Germany to back more pro-growth policies to halt the deepening debt crisis in Europe, as President Obama for the first time gained widespread support for his argument that Europe, and the United States by extension, cannot afford Chancellor Angela Merkel’s one-size-fits-all approach emphasizing austerity.
…
In a tense meeting here at this storied presidential retreat, it seemed at times as if it was Ms. Merkel — who herself faces stiff opposition at home to more bailouts of its neighbors by German taxpayers — against the world. Things did not seem to get off to a good start either on Friday night, as Mr. Obama greeted his guests for dinner in a rustic wood cabin.
“How’ve you been?” Mr. Obama asked Ms. Merkel.
She shrugged and pursed her lips.
“Well, you have a few things on your mind,” Mr. Obama said consolingly.
…
I propose a challenge; how would you spend your Facebook billions?
I might buy the Dallas Cowboys. I’d change the team color to hot pink and DARE the other teams to make fun of us. Then I’d do away with those sissy face masks.
Or maybe I’d buy an entire floor of condo-safe deposit boxes in Toronto and fill each one with 100 dollar bills.
I would buy more FB shares. Can’t go wrong with this.
I would have ghost-written for me a book describing to the world what a financial genius I am and would hire interns (think free labor) to hawk the book to the multitudes of unwashed masses and allow my name to be liscensed to various wealth-building schemes.
Then I would buy Nigeria.
I would make it my mission to end the Humane Society as we know it in our country…The society exists because we allow people to abuse animals and give people the ability to own a animal as a right…I say its a privilege…
A small fleet of hydrofoils so that my family, friends and I could zip around on the vast Indian Ocean. Maybe some ordinary land on the western Australia coastline and build some non-descript living quarters.
Buy some acreage with fantastic views and resources in the Unitred States - pay others to help develop it as a privately-owned reserve (by me) yet for free public enjoyment and recreation.
I’d also sponsor up to a few thousand people who want to do as Dick Proenneke did. If you haven’t seen this, watch it. It’s even housing related!
http://www.youtube.com/watch?v=iYJKd0rkKss&feature=fvsr
Finally, create opportunities for people to learn the folllowing:
http://www.youtube.com/watch?v=eGDWzaGVkgo&feature=relmfu
If I had a billion dollars…
I would offer Obama AND Rick Scott each $10 million dollars to resign. They’d have 24 hours to decide. Then, if each of them didn’t resign, I’d offer a $25 million dollar reward to anyone with information that would force them to resign.
On top of that, I’d offer a $25 million bonus if the information led to an arrest with a $50 million dollar bonus if that arrest led to jail time.
I’d take what ever is left and repeat the process with the Koch Bros., Biden, and anyone else that is using the FIRE sector to destroy the middle class.
Then I’d take Monday off and go to a park with my kids.
I would buy a presidential or congressional election to demonstrate to the U.S. citizenry how elections are won, irrespective of their votes.
I’d renounce my citizenship and go to Singapore…..
Oh wait….
I would buy one of the older basketball/hockey arenas and have all of my favorite bands play there on the weekends for friends and family.
Concerts like this one I attended last night.
http://www.azcentral.com/thingstodo/music/articles/2012/05/19/20120519rammstein-concert-review-glendale.html
I propose a challenge; how would you spend your Facebook billions?”
Buy other companies That make real money
Wall St. Revenue Seen Down, JPMorgan Loss Looks Worse
By JASON MA, INVESTOR’S BUSINESS DAILY Posted 05/18/2012 12:51 PM ET
Wall Street’s trading and investment banking revenue is seen falling sharply in Q2 but will probably do better than JPMorgan Chase’s (JPM) derivatives blunder, which could get far worse.
For a group of eight U.S. and European investment banks, including Goldman Sachs (GS) and Morgan Stanley (MS), fixed income revenue is expected to drop 32% from Q1, a JPMorgan analyst estimates.
Revenue is seen falling 14% in equities trading and 17% in investment banking. The reasons include lower client activity and the drying up of massive European Central Bank lending.
Meantime, JPMorgan’s trading losses in credit default swaps could deepen to $5 billion from the bank’s initial figure of $2 billion, the Wall Street Journal reported.
In intraday trading, JPMorgan shares were down 1.8%, while Goldman and Morgan Stanley were each off by less than 1%. UBS (UBS), Deutsche Bank (DB) and Credit Suisse (CS), which were among the other banks named by the analyst, were higher.
…
How would I spend the FB zillions?
All of my friends would no longer be scraping by.
Seveal charities would no longer be scraping by.
I don’t want a bigger place to live or a different car. I would fix up the back bathroom cause it is really old and ucky.
I will confess, I would buy myself a cool car or two.
I would like a “planter” window in the kitchen.
I’d find the poorest Mississippi school district I could find, pay for the best teachers, hire the kids parents, and pay them upper-middle class salaries.
Then sit back a generation or two, and watch them prove that “money” has more to do with educational achievement than “culture”
An identical reproduction of either:
-1967 Ford Mk IV, or
-Chaparral 2F
-Spend some windtunnel time refining the aerodynamics
-Go get the catalogs, and build the biggest, all aluminum 600ci plus engine available (Weber carbs, or Hillborn Fuel injection…..I’m old school). Install in car.
-Haul car out to a High Plains Interstate highway. Find a trooper running a radar trap, preferably just beyond the crest of a hill, early in the morning. Unload car, send the hauler to a pickup point 5-10 miles beyond the trooper.
-Accelerate, get about a 2 mile run at the hill. Crest the hill doing 200+ plus MPH. See if his radar gun blows up, or if the shock wave flips the cruiser. Keep the pedal down, until you meet the hauler.
(I have a very similar fantasy involving an F-105 “Thunderchief”, and a Presidential “No-fly” zone……..)
Charity trusts.
Friends/family invited on all expense paid trips.
Kids would attend better colleges.
Modest oceanfront or canalside property and a smallish sailboat. Ok, then my husband would want something to waterski with.
Besides that not much would change.
Spend less time working.
Spend less time researching the next investment, and more time researching the next charity.
Wife would dramatically reduce hours and pay (assuming that’s what she wants).
Travel a lot more with family.
My 28 year old niece is now officially graduated from CSU Fresno with a degree in art. She overcame a family tragedy of losing her closest brother a few years ago due to injuries in an auto accident. Yes it is hard to make a living in art. Hopefully she Will get accepted in the master’s program. I am proud of her. While I think on-line learning is becoming more useful it cannot replace the learning of diversity and cultures by being around people who “want” to learn rather than “have” go learn.
BILA, someone has hacked your account!
You obviously do not know me. I value academia. Social liberals are that way.
I’m wondering about your comment about her getting a BA in art coupled with the comment “it’s hard to make a living in art”, and then her planning to SPEND MORE MONEY to go after a Masters.
I don’t see how she could afford the degree as she had neither job nor loan.
“You obviously do not know me. I value academia. Social liberals are that way.”
Not totally, I was more joking, FWIW.
BILA, someone has hacked your account!
No, he’s back on his meds. Good for you, Bill. Welcome back to the human race.
Most of the gear heads I know are college graduates. Majority are certainly not Maoists. And they have a high regard for academia.
Congratulations to your niece, Bila! I do believe the lady has inherited your gumption.
May her work bring insight and pleasure to an increasingly homogenized world.
Thankyou for your kind words!
2007: There’s no housing bubble in Texas!
2012: http://dfw.cbslocal.com/2012/05/18/new-arlington-development-going-up-next-to-city-landfill/
Icelanders to banksters: “You can take this debt and shove it. We’re going fishing.”
California, which used to have huge fisheries before environmentalism ran amok, could learn a thing or two from the Icelanders.
P.S. It is a fortuitous coincidence that the author of this WSJ piece’s last name is “Forelle,” German for “trout.”
MARKETS
Updated May 19, 2012, 5:47 p.m. ET
In European Crisis, Iceland Emerges as an Island of Recovery
By CHARLES FORELLE
VESTMANNAEYJAR, Iceland—Three and a half years after Iceland collapsed in a heap, Dadi Palsson’s fish-processing plant has the air of a surprising economic recovery.
Mr. Palsson arrived at 4 a.m. on a recent workday. Twelve tons of cod were coming in. Soon, his workers would bone, slice and pack the fish for loading onto towering container ships headed abroad.
Three years after a spectacular financial collapse, Iceland is coming back, largely on the strength of its strong exports. Video and reporting by Charles Forelle from the island of Vestmannaeyjar.
In 2008, Iceland was the first casualty of the financial crisis that has since primed the euro zone for another economic disaster: Greece is edging toward a cataclysmic exit from the euro, Spain is racked by a teetering banking system, and German politicians are squabbling over how to hold it all together.
But Iceland is growing. Unemployment has eased. Emigration has slowed.
Iceland has a significant advantage over stressed euro-zone countries—a currency that could be devalued. That has turned its trade deficit into a surplus and smoothed its recovery.
So brisk is the fish business that Mr. Palsson’s factory draws Polish workers to this island off an island, a heart-shaped dollop of volcanic rock five miles from Iceland’s south coast.
The harbor at Vestmannaeyjar is protected from the open ocean by a ring of cliffs.
“Every house is full because we can offer so many jobs,” said Mr. Palsson, 37 years old. On his humming factory floor, cod whip through machines that lop off heads and slice out bones. Rows of workers in Smurf-blue smocks lean over illuminated tables to cut the filets.
Iceland—with its own currency, its own central bank, its own monetary policy, its own decision-making and its own rules—had policy options that euro-zone nations can only fantasize about. Its successes provide a vivid lesson in what euro countries gave up when they joined the monetary union. And, perhaps, a taste of what might be possible should they leave.
Iceland fell hard in 2008. Its engorged banking system sunk and unemployment soared. The government was jeered out of office by dispirited voters in angry street protests. Young people packed their bags. As in the euro zone, the International Monetary Fund parachuted in with a bailout.
Its currency devalued by half. That boosted exports, like Mr. Palsson’s fish, and trimmed costly imports, like cars. The weakened krona was hard on homeowners who borrowed in foreign currency, but Iceland’s judges and policy makers orchestrated mortgage relief. Expensive foreign goods also ignited inflation. Consumer prices have risen 26% since 2008.
That rescue, in turn, weighed on the financial system. But unlike Ireland, for example, Iceland let its banks fail and made foreign creditors, not Icelandic taxpayers, largely responsible for covering losses.
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JPMorgan Chase
Dimon in the rough
A scramble to benefit from a bad trade
May 19th 2012 | New York | from the print edition
A BIG but digestible mistake by a financial institution with abundant profits and capital should normally be viewed as the market equivalent of an electric shock, a jolt that leads to smarter behaviour. The response to JPMorgan Chase’s $2 billion (and rising) loss on a position taken by its chief investment office could not have been more highly charged.
The loss has reinforced the political appeal of bashing banks, no matter what the facts. Barack Obama went on a TV chat show on May 14th and responded to questions about the loss by implying it would have been blocked under the Volcker rule banning proprietary trading. Given the proposed wording of the rule and the apparent nature of the trade, which seems to have started out as an attempt to hedge risk, that assertion is at best a stretch.
Elizabeth Warren, a senatorial candidate in Massachusetts, also jumped on the bandwagon. “Wall Street isn’t going to change its ways until Washington gets serious about strong oversight and real accountability,” ran a campaign ad. Yet JPM is already among the most heavily regulated institutions in America, if not the world. Supervisors have employees climbing all over the bank; they routinely review its credit and business practices. Perhaps to pre-empt criticisms of inept oversight, a string of regulators has nonetheless announced investigations into the trade.
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Given the proposed wording of the rule and the apparent nature of the trade, which seems to have started out as an attempt to hedge risk, that assertion is at best a stretch.
That entire sentence seems like a hedge and a stretch. The Economist is a lot like the Wall Street Journal. Generally informative, as long as you remember it’s a mouthpiece of the 1%.
Just checking to see if I can post
Hello everyone. For a long time I was not able to post. I am not sure why, but I am back. I see we do have the Romney/Obama race that I actually predicted when Obama won in 2008 and I am not happy about that but so be it.
As far as housing, I think QEIII is quite close and the PTB will continue to drive up rent prices to put a floor under housing prices. I don’t see a big move either way in housing prices.