Bits Bucket for July 4, 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.
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Name:Ben Jones
Location:Northern Arizona, United States
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Happy birthday, America!
Bah, humbug!
Wrong holiday, dude. You’re about five and a half months early.
I guess fireworks sales have dropped off a cliff. cities and its people are too broke to celebrate.
People normally buy a lot out here, but even the hardcore guys who love to have a bit illegal bash with them are holding off this year due to the fires.
Kind of hard to get enthused about a parade when you find out the confetti being used is actually shredded copies of the Constitution.
I’m with Palmy on this one.
Also kind of hard to get enthused about declaring independence from the thrall of the Dutch East India Company only to realize you’re under the thrall of Goldman Sachs.
Ding ding ding ding!
We have a winner.
Well said, oxide.
We have become the very thing we fought against.
“And in the America colonies, as we’ll see in the next
chapter, an attempt by the East India Company to expand its tea business at the expense of independent American merchants in ports like Boston, Philadelphia, and New York was a principle cause of the merchant- led rebellion known as the Boston Tea Party.
Yet despite the crucial role played by the East India Company in British politics and the events that precipitated the American Revolution, there are other aspects to the story of how British corporations affected the politics and culture of pre-Revolutionary America. Of these, the most striking example is the brief and tragic story of the Virginia Company.”
Gangs of America - page 39
…He has refused his Assent to Laws, the most wholesome and necessary for the public good.
He has forbidden his Governors to pass Laws of immediate and pressing importance, unless suspended in their operation till his Assent should be obtained; and when so suspended, he has utterly neglected to attend to them…
“you’re under the thrall of Goldman Sachs.”
Will you still vote for Obama?
A vote for which candidate will make a difference? (And if you say either of the two major candidates for president the next question is, are you serious?)
IAT
A vote for which candidate will make a difference? (
Ron Paul. Sure, he won’t be elected, but at least you are making a statement to the PTB that the status quo is unacceptable to you.
Last I heard, Ron Paul is not running. If that changes, then I would consider it. If not, I may as well write in anyone now living, as it would have the same effect. Not be counted, not be reported, and come to nothing.
IAT
Amen, brothah!
I’m reading this AM about the still remaining power outages in the mid-Atlantic and even Ohio. I can understand why people are seething about it, but they may as well get used to it. No longer the “can-do” nation. Unless you’re bombing the crap outta some hell-hole in the Middle East, and even then, that hasn’t gone well.
“I can understand why people are seething about it, but they may as well get used to it. No longer the “can-do” nation.”
Next thing you know, Smithers and 2banana are going be explaining to us how the derecho was Obama’s fault.
How could it be Obama’s fault when he made the oceans recede?
Well, bringing people back onto the power system costs money, doncha know? So the system is restored at the rate determined by the funding of the repair crews; and given the state of any budget, the funding of anything that isn’t directly revenue-generating is anemic at best.
I’m sure each utility company has a spreadsheet specifically created for tracking the profitability of the % of people who don’t demand a credit for the lost service days. Even statistics is on the side of the corporations.
How could it be Obama’s fault when he made the oceans recede?
+1 Has Uncle Tom really accomplished anything other than serving his Wall street masters?
Add me to the list. A lot of conflicted feelings during the playing of the National Anthem before my Daughter’s games this year.
A lot of conflicted feelings during the playing of the National Anthem before my Daughter’s games this year.
I still get chills when I hear the National Anthem played.
“I still get chills when I hear the National Anthem played.”
Not me. I get chills when I watch Nathan’s Hot Dog eating contest while saying a prayer for all of the colons of those crazy ba$tards.
My choral group recently sang the second and third verses of The Defense of Fort McHenry for a performance. Did you know that in 1918 one line in the third verse was changed from, “then conquer we must, when our cause it is just” to, “then conquer we must, for our cause it is just.” Seems they needed to up the propaganda quotient. We were part of a bicentennial of the start of the War of 1812 thing, so we sang the original version which allows for the possibility of not winning.
The tempo has been modified a lot, but the tune is an old English drinking song.
Which, with its octave and a half range, is best attempted after you’ve had a few.
SD Renter
Isn’t it about time to update that blogonym?
talon,
You have no idea how hard it is to pull off. The problem isn’t really the range for people accustomed to singing. The problem is keeping the tempo up and keeping to the correct rhythm and only the notes written on the page. You are so used to hearing it “modified” by soloists it is very tempting to slow down a bit, throw in a few extra notes, etc. We rehearsed it way more than anything else in the program and everyone already knew their parts.
Here’s a US national anthem for you, from what I guess we now have to call the end of the good old days:
http://www.youtube.com/watch?v=QRvVzaQ6i8A
IAT
“but the tune is an old English drinking song.”
So is our nation’s theme song! BEER ME!
http://en.wikipedia.org/wiki/To_Anacreon_in_Heaven
From yesterday;
Comment by Rental Watch
2012-07-03 15:57:29
And scdave, one of the problems that I experienced with great frustration in the past (and it’s been going on for quite some time in Silicon Valley) is parents helping out their kids with as much of a down payment as necessary to make the home affordable for their kid. It is tough to compete on buying when the next guy over has a 50% down because his parents want their grandkids nearby ??
No question about it…..And, its all about degree…If you come from a family of wealth, then you move into the better zip codes…If the assistance is more moderate then you get the basic 2-bed 1-bath house in a decent place…If the assistance is minimal, then its a condo or townhome…
But I would also add that the two income family also plays a significant role…Not uncommon at all to see $250,000. +….That goes a long way in being able to afford a mortgage @ 3% interest rates….
Lastly, its not just about cash assistance….How about job assistance…You could argue that a gold plated job is more valuable than down payment assistance….Many of my children’s friends are working in family business of some sort…And they are making serious money because the CEO is dad & mom…One for example, is 31 years old, just bought in one of the most expensive zips in our area and pulls down around $350,000. per year…
Too bad we only get to play the vagina lottery once.
“…only…play…once…”
Which lottery are you talking about, again?
I think he’s referring to the “lottery of birth”.
I dunno. You need to play the cards you were dealt not the cards you wish you were dealt.
I dunno. You need to play the cards you were dealt not the cards you wish you were dealt ??
I agree…However, it is hard to compete sometimes when you come to bat and your competitor always gets to start on third base…
It is what it is. Deal with it!
Whining gets you nowhere. Even stating the obvious in this case gets you nowhere.
I agree about the whining, but denying a problem doesn’t solve it and blaming the victim is not justice nor a solution.
The 19th century is long past and stoicism is for suckers.
How am I denying the problem exactly? I’m not blaming the victim either!
There are two questions here philosophically.
What needs to get done?
What should I do while things get done?
You are conflating the two.
Time’s running out for most people (and I’m on the extreme younger end of this spectrum) for #1.
#2 is all you have concretely.
You do what you need to get done, and just when you think you’re finally going to succeed, they’ve changed the rules in their favor, and you’re back at home plate.
Yup, griz. It sucks wide. But there are a few moves that are always good to avoid. Going deeply into debt is pretty close to that always. I got away with it once ($70K on law school) but it was a much better bet at the time than it is now, and I got out of the hole in less than three years even though it meant living in artificial semi-penury for a bit. For people who are never going to be in a situation to pay off their debt quickly, well, they never should have gotten there in the first place. If it is something other than student debt - like for health care - well, you need to keep enough cash on hand to pay a bankruptcy attorney. If the people with capital are going to manipulate the system so you have no choice but to take on debt you can never hope to repay, then you have to be willing to play their game and repudiate it.
Then:
“And for the support of this Declaration with a firm reliance on the protection divine Providence, we mutually pledge to each other our Lives, our fortunes and our sacred Honor.”
And now?
Besmirched. Totally besmirched. The US’s Congress, Executive branch and SCOTUS have a firm reliance on the military industrial complex, to which they pledge their lives and fortunes. They have no honor.
The US’s Congress, Executive branch and SCOTUS have a firm reliance on the military industrial complex, to which they pledge their lives and fortunes.
They don’t pledge their fortunes TO them—that would be missing the whole point! They pledge, rather, to make a fortune FROM them, after they have left office and it no longer has the appearance of a conflict of interest.
I dunno about that. The American colonies were established as debtor’s refuges; both Jefferson and Washington were on the lam from huge debts to the Crown, and most of the colonists were there because they were promised hiatus from collection attempts or had been released to indentured servitude. Georgia in particular was founded to relieve the overflow in London’s debtor’s prisons.
“Sacred honor” had very little to do with it.
Can’t see that much has changed since then….
Can’t see that much has changed since then….
I agree, Allena—little has changed. Except perhaps for the worse, as now there is no “new world” to flee to in order to avoid your debts to the crown…
as now there is no “new world” to flee to
Mars?
You need help.
The moon?
“we mutually pledge to each other our Lives, our fortunes and our sacred Honor.”
FHA Loans?
To me what was important about the period when the colonies declared independence was the form of their resistance. It was the beginning of a new type of governance. Where the liberty of the individual was the goal. It wasn’t to be one king replacing another, although there were some that couldn’t imagine it any other way.
I realize that the media and others try to make this into yet another day to worship the state. But not me. Our ability to sit at our computers and communicate on this blog are an example of what independence is about.
+1 on the last paragraph Ben…
I enjoy the measure of independence. A lot is available to us, if only we do not surrender it bit by bit.
“… an example of what independence is about.”
We saw a performance of a play last night, Inherit the Wind, which represents another example of what independence (not to mention the HBB) is about: Free exchange of ideas.
Though the play is a fictionalized reenactment of the Scopes Monkey Trial, the program notes pointed out that the work was written during the McCarthy era, when Freedom of Expression in America was in severe danger of extinction.
I saw an interesting statistic recently (I don’t have the citation handy, but I know the book it’s in and once I get that, I’ll post this again):
60% of people will follow social rules and norms without prompting.
20% of people will follow social rules and norms but need some prompting.
10% will follow social rules and norms but need a consistent and credible threat of consequences in order to do so.
10% of people will not follow social rules and norms except under high supervision.
Basically, one could naturally have a cooperative, libertarian society with that 60%. Perhaps even with the 80%. But that remaining 20%, and especially that top 10% - that’s why we need the state.
Without some kind of state structure in place, enforcing the rules in some manner, we’d quickly slide back into the morass we evolved from. We’d quickly slide back into feudalism. The most ruthless and physically powerful and intelligent would rise to the top of society, once again. And the rest of us would slide back into serfdom.
Our ability to sit at our computers and communicate on this blog
… came out of a DoD project funded by the taxpayers of said State. But at the same time, we can use DoD’s invention to speak out against the same State. So is that freedom or irony?
‘came out of a DoD project funded by the taxpayers’
Yeah, the computer or internet would never have been invented if it wasn’t for the govt taking our money and spending it. We’d be sitting here using smoke signals, drums and coconuts with strings between them.
If it wasn’t for Thomas Edison, we’d all be typing on our computers by candlelight.
LOL…
Agreed on the free speech. But this kind of thing is scary and interesting:
Twitter ordered to forfeit Occupy activist’s tweets
Twitter must give a court about three months’ worth of an Occupy Wall Street protester’s tweets, a judge said in a ruling released Monday after the company fought prosecutors’ demand for the messages.
I vote that the ALA (American Library Association) be in charge of the Internet.
“came out of a DoD project funded by the taxpayers of said State”
That may have been the seed or the spark, but the hundreds of billions of dollars from the private sector have built the internet of today and will keep it running in the future. The private sector laid the fiber, purchased or leased the facilities, built or purchased the optical transmission gear, built or purchased routing and switching gear, hired engineers, technicians, customer service, managers…etc. Some of those private companies even went bankrupt doing all of the above because the aforementioned infrastructure is extremely expensive to purchase, implement and operate.
That’s silly. It’s like the taxpayers spend trillions of dollars looking for oil on Mars and, then, once they find the location, a bunch of billionaires invest their resources. Then, 20 years later, some revisionist historian comes along and emphasizes the billionaire’s investment.
Look, the first money is always the most important. Nobody would have laid an inch of fiber optic cable had it not been for the taxpayers spending the first money. SO, the real benefactors are you and me, not some wealthy person (who flies private plane) who came in in 1998 and stuck in the risk-equivalent of a few pennies (risk-equivalent because the possible gains were already visible by then).
Or, in short, we always socialize the costs and privatize the benefits. We do it, so we should at least be honest and admit that’s what we do.
IAT
“That’s silly.”
Silly is thinking that we would have all of this innovation and expansion of the internet without the profit motive.
I have no problem with government partnering with universities and private industry to research new technology, that is a good thing and should continue. To take products from the development stage to broad commercial use requires private capital. Most Americans with the exception of the hard core progressive kool-aid drinkers understand this reality.
“Or, in short, we always socialize the costs and privatize the benefits. We do it, so we should at least be honest and admit that’s what we do.”
When it comes to the Fascist REIC-Government-Wall Street cabal, I agree 100%.
Where did I say the profit motive doesn’t matter? I simply said that if all you have is the profit motive, you would not have the internet. Why is this true?
Face it, the more advanced our society becomes, the more advanced our knowledge grows, the more financially costly and the more risky the next advance is. Because of this, profiteers will never take that next step, because there are hundreds of directions they could step, and only, say, 5 will produce gains. Few good businesspeople would take that gamble, and, owing to increasing concentration of private wealth, the few who would don’t have the capital needed.
Given this, some government funded by some taxpayers somewhere — the US when we wanted to lead, perhaps China now that we’ve decided to follow — will have to step in and take the risk. What happens next — whether taxpayers get a bite of the money profiteers get by taking the step AFTER the risky step (see Norway) or not (see the US) is a social decision.
BUT, technically, you really cannot be arguing that profiteers — who make their money owing to the status quo — would seriously get involved in exploring deep ways to upend the status quo. If they do that, they are, frankly, irresponsible businesspeople. The shareholders would have their head on a platter.
IAT
I agree, IAT. Private sector always waits until they know there’s profit to be had, or they don’t lift a finger.
And don’t think they didn’t recoup the cost of that cable several times over.
Government does not pay for itself.
Once a year I post this Alec Baldwin speech (voted best dramatic video on You Tube) to remind us what a great country we have.
These guys were selling the American Dream, well sort of…worthless land.
http://www.youtube.com/watch?v=W7lhkKCHeaE
“Put that coffee down, coffee is for closers.”
“…(voted best dramatic video on You Tube)…”
I thought William Holden dissing Faye Dunaway was better:
Max leaves Diana - Network (1976)
http://www.youtube.com/watch?v=X4DXaKuOAZ0
Happy July 4th. What do you like about our country.
I love cheese burgers, relaxed clothing can be worn anywhere, tons of chocolate at cheap prices and it’s a very beautiful country with decent people. Yes and the house prices are heading down.
It’s the country that showed me unimaginable generosity when I pedaled through all 50 of its states. To this day, I am awestruck.
You just reminded me of when I was a kid and we were camping somewhere near Yellowstone. Camped next to us were 3 or 4 people who were seeing the Rocky Mountains on their bicycles. You didn’t see that as often back in the 70s.
Anyway, when we camped we always made big traditional breakfasts. The bikers, of course were traveling light. They had food, but it was minimal. My dad likes to cook and we had plenty of ingredients so he invited them to breakfast with us. He cooked until they were tired of eating. It was amazing to watch…and actually a bit entertaining.
I experienced the same generosity while traveling through all 50 states on my motorcycle.
Cool! Another 50-stater! If you ever come to Tucson, let’s swap a story (and a lie) or two.
Roger on the Happy Birthday, America! The 4th of July is my favorite holiday.
Very quiet in the neighborhood . Growing up in the late seventies, I remember the week of the fourth for its tranquility. I worked summers for my uncle’s trucking company and manufacturers would close for the entire week. Seems odd now to think Eastern Massachusetts actually had manufacturing. American Can in Millis, Marlborough Shoe in Marlborough and Data General in Framingham were among my stops, all gone now. While far from ideal careers these factories did offer a steady wage to those without the ambition or capacity to do better.
Anyway, Happy Fourth of July to the HBB.
Wow fellow New Englander….. you just brought back many memories.
You mention manufacturing shutdowns. My father and all his coworkers would get two weeks off during July 4th and then my father would head to my aunts farm in the Chesapeake and work there.
Now it’s quiet 365 days a year. It’s all gone. Including half the population. It’s surreal.
I thought the manufacturing facilities were turned into loft condos?
Or were those the places where they processed wool and the lanolin made the floors so gorgeous.
Generally, they’re sitting and rotting while the hazardous waste continues to spread.
EDITORIAL: Happy Dependence Day
Who needs Ben Franklin when we have John Roberts?
By THE WASHINGTON TIMES
-
The Washington Times
Tuesday, July 3, 2012
Forget about those fireworks (too dangerous) and their ostentatious display of anachronistic values. Forget also about mom (sexist gender-role stereotype) and apple pie (too fattening). Wednesday has become Dependence Day, a time to reflect on all the good that the federal government does for us.
Thursday’s Supreme Court decision set us free from the tired notion that individuals should be forced to make difficult decisions about what’s best for themselves. How much better we all are that we have unelected agency heads in Washington who can plan for the collective good.
Such plans now encompass everything that touches on a person’s health and well-being, as President Obama explained while enumerating the blessings of his reinvigorated Obamacare law. “Because of the Affordable Care Act, young adults under the age of 26 are able to stay on their parent’s health care plans,” he said. “Because of the Affordable Care Act, seniors receive a discount on their prescription drugs - a discount that’s already saved more than 5 million seniors on Medicare about $600 each.”
That’s just a sampling of the upcoming goodies that we have been promised on top of already generous entitlements. According to the Census Bureau, there are 17,777,797 Americans whose paychecks come from either a local, state or federal government entity. Another 13.9 million who don’t work also receive government checks in the form of unemployment benefits. Some 61.5 million retirees receive an average of $1,126 per month from Social Security. Forty-six million are on food stamps and related programs at a collective cost of $105 billion.
Taken together, the Tax Foundation estimates 58 million Americans filed tax returns but paid no income tax, receiving a total of $105 billion in refundable credits. This shows the number of households dependent on the generosity of politicians is nearly equal to the number who rely on their own hard work.
This isn’t the state of affairs the Founding Fathers imagined as they sketched out their blueprint for a national government. In an April 1768 letter to The Gentleman’s Magazine, Ben Franklin explained his principles by writing, “I fear the giving mankind a dependence on any thing for support, in age or sickness, besides industry and frugality during youth and health, tends to flatter our natural indolence, to encourage idleness and prodigality, and thereby to promote and increase poverty, the very evil it was intended to cure; thus multiplying beggars instead of diminishing them.”
http://www.washingtontimes.com/news/2012/jul/3/happy-dependence-day-302029430/ - -
You can buy any and all types of fireworks here in SC .If we buy a few ,we always buy from the little stands set up by the roadsides . Can’t quite make myself go into one of those square cement buildings that are a waiting explosion chock full of blackpowder.
Most fireworks sales seem to go to the folks who can least afford them, the ones with the 3-color pickup trucks ,often with windows down .
Legal in NH as well. Bottle rocket scientists..
Nine people injured, including two children, in N.H. fireworks blast
PELHAM, N.H. — A cache of fireworks ignited and exploded inside a home here Tuesday night, injuring nine people, including two children who were airlifted to Boston hospitals, police and neighbors said.
Pelham police said that the house at 40 Dodge Road caught fire at about 7:30 p.m. and that “a large amount of fireworks were located in and around the home.”
The initial report was that “fireworks blew up in the home and that the house was filled with smoke,” the statement said
http://www.boston.com/metrodesk/2012/07/03/nine-people-injured-including-two-children-airlifted-boston-hospitals-fireworks-blast-police-say/ZxKcVQSHLazwhW4lic18AJ/story.html
Darwin is always busy on the 4th.
July 4th in San Francisco is always a bust. A bunch of fog all lit up and that’s about it.
A lot of yahoos in the Mission setting off anything and everything, and invariably a few small brush fires in our dry parks.
Shut the windows tight and blast the tunes so the dogs don’t freak out too badly.
Wait. Why aren’t all the good hospitals in low tax New Hampshire?
No need.
Shortly after the Civil War, a group of civic leaders and physicians started a 20-bed hospital for children in a South Boston row house. Initially, much of the care was provided by nuns. The funding – a dollar here and a dollar there – came from donations. In recognition of its charity, the hospital was exempted from paying taxes.
Today, more than a century later, taxpayers still subsidize Children’s Hospital Boston through a series of tax breaks valued at nearly $40 million. But most of the other similarities end there.
Children’s Boston is now one of the largest and wealthiest children’s hospitals in the world, with $1.3 billion in annual revenue in 2009, $2.6 billion in stocks, real estate and other investments, and a 125-employee fundraising unit that raises about $90 million a year.
As for charity, Children’s Boston spends about $8 million annually on free medical care, less than 1 percent of its annual expenditures, according to the hospital’s tax returns and other financial records.
http://www.kaiserhealthnews.org/Stories/2011/September/26/Childrens-Hospitals-Charity-Care.aspx
Especially when those roadside stands speak Gullah:
http://www.youtube.com/watch?v=Uz2lYOXocHU
The Washington Times:
http://en.wikipedia.org/wiki/The_Washington_Times
They will staighten out this Robo signing thing the lawyer from Cornell is wrong.
Yes, a favorite source of Drudge Report links, along with esteemed journalistic sources the New York Post and the UK Daily Mail…
Maybe it was the weather, and maybe it was the queen’s fault, but the return of the UK economy into recession decidedly is not due to the ongoing, unresolved effects of the property bubble collapse, right?
Recession fears raised as UK construction sector contracts
Monthly survey reveals a marked deterioration in business conditions
Larry Elliott, economics editor
guardian.co.uk, Tuesday 3 July 2012 07.05 EDT
Fears that Britain’s double-dip recession deepened in the second quarter of 2012 heightened on Tuesday after the latest snapshot of the construction sector revealed a marked deterioration in business conditions.
The monthly survey from CIPS/Markit showed that the closely watched Purchasing Managers’ Index dropped from 54.4 to 48.2 in June – below the 50 level that separates a sector that is expanding from one that is contracting.
Weakness in construction was a big factor behind the economy’s 0.3% decline in the first three months of 2012 and analysts warned that the latest data pointed to another quarter of falling output.
David Tinsley, UK economist at BNP Paribas, said the evidence from the PMI was that construction was contracting at its fastest rate in two-and-a-half years, but that the extra bank holiday to mark the Queen’s diamond jubilee probably played a part.
“The weather may also be playing a part – it’s close to being the wettest June in England since 1910. Still reports also suggest weaker underlying business conditions, with civil engineering and housing the worst performing areas.”
…
This ought to be good for another 5% hike in crude prices…
5.05 PM Wednesday, 4 July 2012
Major EU economies in recession
Composite PMI suggests 0.6 percent decline in Q2 GDP
By Reuters
Published Wednesday, July 04, 2012
All of Europe’s biggest economies are in recession or heading there and there is little sign things will improve soon, surveys showed on Wednesday, backing a growing view the region’s major central banks are poised to ease policy this week.
Business surveys covering thousands of companies suggested the euro zone economy contracted again between March and June, and that Britain’s mild recession extended into a third straight quarter.
The latest batch of purchasing managers’ indexes did nothing to alter expectations the European Central Bank will cut interest rates to a new record low on Thursday, or that the Bank of England will turn its printing presses on again to buy bonds.
“The PMIs are bottoming out at a level consistent with further contraction of activity in the second quarter,” said James Nixon, chief European economist at Societe Generale, of the euro zone PMIs.
Markit’s Eurozone Composite PMI was revised up in June to 46.4 from a preliminary reading of 46.0 that matched the May figure, but the index has undercut the 50 mark that divides growth from contraction for nine of the last 10 months.
“We are looking for GDP to decline by 0.3 percent in the euro area in Q2 and these numbers are perfectly consistent with that,” Nixon said.
PMI compiler Markit said the surveys were consistent with a 0.6 percent contraction for the euro zone economy in the second quarter, and 0.1 percent for Britain.
Worryingly, there were clear signs that Germany, Europe’s biggest economic engine, is also entering a modest downturn. Its services sector unexpectedly stagnated in June, as its PMI reading fell to its lowest since September last year.
“Germany looks to have fallen into a renewed decline, though only a very modest drop in output is signalled. The pace of downturns in other major euro member states is far more worrying,” said Chris Williamson, chief economist at PMI provider Markit.
He said output in Italy probably declined 1 percent in the second quarter, with steep downturns also on the cards in Spain and France.
Perhaps the only bright spot in the PMIs was a sharp drop in price pressures among companies in the euro zone, suggesting inflation will decline in coming months.
A sharp fall in oil prices held inflation steady at a 16-month low of 2.4 percent in June, cited by many economists as a major reason why the ECB may cut interest rates this week by 25 basis points to a record low 0.75 percent.
News euro zone retail sales rose 0.6 percent in May after falling 1.4 percent in April failed to overcome the gloomy mood in markets, as European shares retreated from two-month highs on Wednesday after three days of gains.
JOB WORRIES
The PMIs showed little sign of relief for workers - euro zone firms cut jobs for the sixth straight month in June, suggesting the currency union’s record unemployment rate of 11.1 percent in May has further to climb.
“Job losses are mounting as a result of falling demand, as companies seek to reduce costs and prepare for the possibility that worse is to come,” added Williamson.
While the euro zone’s services PMI also edged up slightly to 47.1 in June from 46.7 in the previous month, it was still anchored below the 50 mark for a fifth straight month.
Britain’s dominant service sector, which accounts for the vast majority of its private economy, grew at a much weaker pace than expected last month, as the PMI fell to 51.3 from May’s 53.3 compared with an expected 52.8.
The latest round of gloomy data will solidify expectations the Bank of England will start another round of quantitative easing (QE) asset purchases when it meets on Thursday.
“The sharp deterioration in June’s UK CIPS services survey seals the deal for more QE tomorrow,” said Vicky Redwood, chief UK economist at Capital Economics.
“If we are right in thinking that the surveys have underestimated the impact of June’s extra bank holiday, the economy is actually probably still in recession.”
Faced with a struggling economy, the BoE is expected to flood markets with another 50 billion pounds of cash this week, on top of the 325 billion pounds it has already pumped in, according to a Reuters poll taken last week.
News from Asian PMIs on Wednesday was fairly mediocre too. China’s developing service sector grew at its slowest pace in 10 months in June, hit by new order growth pushing the PMI down by over two points to 52.3 from 54.7 in May.
…
Haven’t you been asked numerous times to stop posting entire articles?
No, it was “wmbz” who was asked. Now, be nice young lady.
Really? I thought it was Bear and Unknown Tenant/Jeff Saturday.
I just really prefer for someone to highlight the punch line for me. That is why I always do a link and then add in a paragraph or two as the tease. It seems horrendously lazy any other way.
Actually I screen every article I post for the cutoff that makes the most sense to get my point across.
But if you aren’t interested in my posts, don’t read ‘em. Thank God it is still a free country, and nobody is putting a gun to your head to force you to read anyone’s posts here.
Yeah, being polite is so unConstitutional and all.
“No, it was “wmbz” who was asked. Now, be nice young lady.”
As opposed to being a what?
I have three words for you, Polly dear:
Joshua — Tree — Extension.
JTE is the only reason that I installed Firefox on my machine…
I have to admit that I haven’t tazed anyone’s posts, even 2banana or smithers, since the days when JoeyInCA and Eddie were running amok here.
(Scary thought: Maybe 2banana and smithers are actually JoeyInCA and Eddie back again with new names…)
The music may not have stopped, but it sure is slowing down.
China slowdown worsens amid signs US losing steam
By Reuters
Published Friday, June 01, 2012
China’s slowdown worsened in May as its factories saw a further deterioration in demand at home and abroad, dealing a new blow to a global economy struggling with a sharp downturn in Europe and a faltering recovery in the United States.
The darkening outlook was underlined by data showing the fourth monthly decline this year in exports from South Korea, the first major economy to report May numbers, as shipments to the United States, Europe and China all fell.
Equities, the euro and growth-linked currencies all fell after Friday’s gloomy data, which followed reports on Thursday showing India’s growth at its weakest in nine years.
Manufacturing surveys from Europe later are not expected to offer much comfort, while investors’ jitters over the key US non-farm payrolls report, due at 1230 GMT, have been rising since a separate report on Thursday showed US private employers created fewer jobs than expected last month.
“I don’t think Friday’s numbers are going to be any better. It’s been a dismal week so far, and we haven’t hit bottom,” said Jim Ritterbusch, president at oil trading advisory firm Ritterbusch & Associates.
…
What a surprise!
Next we may hear that Austrailia is slowing a bit.
Hard to believe.
time to build some more buildings.
Ghost towns used to be products of a dead economies.
Nowdays ghost towns are used to keep economies alive.
Recessions used to be accepted. Now, they must be avoided.
They used to be when money made its way back to its rightful owners. This time the “rightful owners” were in danger of losing some.
Now, they must be lied about.
Beware the admonitions of independent economists.
China economist warns of sharp growth slowdown
by: Caroline Henshaw
From: Dow Jones Newswires
July 03, 2012 3:45PM
AUSTRALIA’S economy is dangerously dependent on China and the central bank will have to cut rates aggressively to protect the resource-rich nation from a slowdown comparable with that seen in struggling European states such as Spain, says Andy Xie, an independent Shanghai-based economist and adviser to several Chinese banks.
“Australia has a serious Dutch disease,” said Mr Xie, who was formerly chief economist for Morgan Stanley in Asia.
“Australia needs to ease the currency down as quickly as possible to prevent a crash in the property market. Once the bubble bursts, if you let the currency stay at the same level, you’ll see what we saw in Spain,” he said in the recent interview.
Mr Xie warns that foreign investment, largely directed towards large mining and energy projects, will slump from its current level of just under half of gross domestic product, or GDP. This he argues will spark a downturn in the Australian property market that could see house prices drop by between 20 per cent and 30 per cent.
…
German services sector stagnates in June
Wed, 04/07/2012 - 08:09
BERLIN (Reuters) - Germany’s services sector unexpectedly stagnated in June, ending an eight-month period of expansion as new order intake dropped, adding to evidence that Europe’s largest economy can no longer be relied upon to save the region from recession.
Markit’s services Purchasing Managers’ Index (PMI) fell to 49.9 in June from 51.8 in May, just below the 50 level that separates growth from contraction and missing a preliminary estimate of 50.3.
The reading published on Wednesday was the lowest since September last year, driven by lower levels of new work for the third month running and a sharp fall in business expectations.
“The loss of momentum as the summer has progressed indicates that German GDP (gross domestic product) is likely to have only held its ground at best over the second quarter, and there are fears that business conditions are set to weaken further,” said Tim Moore, a senior economist at Markit.
…
Happy 4th of July everybody .
Hi everybody . I’m still alive and kicking .
Hope everybody is doing ok in a mad mad mad World .
Doing OK, and glad to hear that you are, too!
I noticed the absence. Where you been man?
I have been studying everything under the sun to get a handle on what is really going on . It is even worse that I could ever imagine 7 years ago when the debt crisis first reared its ugly head when the housing boom crash started .
It is even worse that I could ever imagine 7 years ago when the debt crisis first reared its ugly head when the housing boom crash started .
Worse in what way, Wiz?
And what sources are you reading these days that you would recommend as worth a look?
Hey Wiz! Great to see you again.
Hi Ahansen and Prime is Contained ………..
In answer to your question Prime , I have gone all over the place for information ,so it would be to numerous to list. Just a truth seeking mission on my part .Course, truth is in the eye of the beholder .
Well, good to see you stopping by; please do some from time to time in the future!
Hi HW!
Good to see you on here. It’s been tougher for me to get on too - new job. Hope you are doing great and we see more of you!
Thanks RE Bear . Don’t know if people want to hear what I have to say however .
Don’t know if people want to hear what I have to say however .
I wanna hear it—dish!
Besides manipulating interest rates and energy prices, in what other price-fixing activities does Megabank, Inc engage?
Bloomberg News
Dimon Faces Image ‘Nightmare’ With Energy Probe
By Katarzyna Klimasinska and Dawn Kopecki on July 03, 2012
JPMorgan Chase & Co. (JPM) (JPM)’s refusal to turn over e-mails in a federal probe of potential energy-market manipulation is the latest challenge for Chief Executive Officer Jamie Dimon as the bank faces multiple investigations.
The U.S. Federal Energy Regulatory Commission sued JPMorgan July 2 to release 25 e-mails in an investigation of possible manipulation of power markets in California and the Midwest by J.P. Morgan Ventures Energy Corp., according to court filings by the Washington-based agency. FERC opened the probe in August after complaints from California and Midwest grid operators that JPMorgan’s bidding practices were abusive, the documents show.
“He’s got a PR nightmare in front of him,” said Paul Miller, a former examiner for the Federal Reserve Bank of Philadelphia and analyst at FBR Capital Markets in Arlington, Virginia. “It’s another headline risk, which means more regulators, which means over-regulation, which will eventually hit their bottom line.”
…
“It’s another headline risk, which means more regulators, which means over-regulation…
Yeah, the next thing you know there will be regulations against financial firms manipulating energy prices! Where does it end?
Rules against financial companies manipulating energy prices? It’s sickening
Enron again…
I would be happy if we would enforce the ones we have on the books already.
Fraud, insider training, manipulation of markets, collusion, etc.
It is not as if these things are legal right now…
Agreed.
dimon and madoff will make good cellies.
Any parent who would name their healthy baby boy “Jamie” would have to know that the boy would have to grow up to prove himself to all of the kids in the neighborhood who beat the snot out of him for having a girl’s name.
He was doomed from the start.
“He’s got a PR nightmare in front of him,” said Paul Miller, a former examiner for the Federal Reserve Bank of Philadelphia and analyst at FBR Capital Markets in Arlington, Virginia.
Couldn’t happen to a nicer fellow.
This is an interesting turn in the Libor story. Could a central bank (the Bank of England) have possibly been involved in fixing a (supposedly) market-based interest rate? After all, isn’t fixing interest rates (the price of money) one of their primary functions?
BUSINESS
Updated July 4, 2012, 8:41 a.m. ET
Barclays Notes Suggest Government Pressure on Libor
By SARA SCHAEFER MUÑOZ
Barclays released documents that suggest senior government officials in the U.K. knew about and encouraged the rate setting practices that led to the resignation of the bank’s CEO Robert Diamond yesterday. WSJ’s David Enrich and Sara Schaefer Munoz report. Photo: Getty Images
The unfolding rate-fixing scandal at Barclays (BARC.LN -0.75%) PLC took an unexpected turn on Tuesday when the British bank made public 2008 notes by now-resigned Chief Executive Robert Diamond suggesting that an official from the Bank of England, under pressure from the U.K. government, may have set off the chain of events that led the bank to lower its submission for calculating an important benchmark lending rate.
Barclays published a raft of documents on its web site in advance of a Parliamentary hearing scheduled for Wednesday on the rate-manipulation scandal. One of the documents is Mr. Diamond’s Oct. 29, 2008 notes of a call between himself and Paul Tucker, a Bank of England financial stability official, in which the men discuss Barclays’ relatively high submissions of the bank’s borrowing rate, one figure used to calculated the key benchmark London Interbank Offered Rate, or Libor.
On Tuesday, Barclays delivered to a U.K. parliamentary committee its summary of the events and investigation into the company’s submission of interbank offered rates. Read the document.
At the height of the financial crisis, Libor was being closely watched as a barometer of U.K. banks’ health.
By Mr. Diamond’s account, Mr. Tucker told him that he had “received calls from a number of senior figures within Whitehall to question why Barclays was always toward the top end of the Libor pricing.” After Mr. Diamond explained the bank’s pricing, he says Mr. Tucker reiterated that the calls he was receiving from the government were “senior” and added that “while [Mr. Tucker] was certain that we did not need advice, that it did not always need to be the case that we appeared as high as we have recently.”
According to the Barclays documents submitted on Tuesday, Mr. Diamond didn’t believe he received an instruction from Mr. Tucker. However Jerry del Missier, then president of Barclays’ investment bank, concluded that an instruction had been passed down from the Bank of England not to keep Barclays’ rate as high.
…
Britain hates and fears the Eurozone and always has. This is their way of sabotaging it.
We are about to head east on family vacation tomorrow. For some reason, whenever we go on vacation, the stock market tanks (probably because it has tanked a lot in the past decade!).
July 4, 2012, 9:25 a.m. EDT
Banks, energy drive early losses for Europe stocks
Parliamentary testimony of ex–Barclays chief in market spotlight
By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) — Losses for banks proved a drag for European stock markets Wednesday, with attention fixed on Barclays PLC and the Libor-fixing scandal, while energy stocks also weighed as crude prices pulled back from five-week highs.
The Stoxx Europe 600 index XX:SXXP -0.39% fell 0.3% to 256.50, after rallying 1% the prior day.
Volumes were pegged lower for Wednesday’s action with Wall Street closed for the Fourth of July holiday. However, potential further fallout for banks from the interest-rate scandal was expected to keep traders from nodding off.
…
Louis Rukeyser had this effect on the stock market too. It was uncanny. When they fired him around June 2002, I remember the market plunging down into the 7000s again. A level we wouldn’t reach for six years.
Interesting note, every 5-6 years, since 1997, we reach the 7000s, albeit briefly.
To my fellow Floridians, please do not celebrate with celebratory gun fire. I know it’s hard, but you can do it.
Thank you
How ’bout a trip to the beach?
http://www.youtube.com/watch?v=6I6AUMMAYZ4
It’s Compton with surf.
Courtney Campbell, lol… hardly the beach — more like an outdoor turdwater storage area with a raised road through it.
And now from that safe city Sanford FlooriddaH
As of the census of 2010,[6] there were 53,570 people residing in the city.
http://mysanfordherald.com/view/full_story/19188648/article-The-Crime-Report–July-4–2012
Swell spot, I’d imagine there are plenty of store security positions available.
I’m with you, Muggy. Thanks for posting the above.
Paul Solman talks to authors Joe Nocera and Bethany McLean
The flattening of middle-class incomes, the “cash-out” mortgage refinance wave and the consumer economy running on borrowed money.
Ratings Agencies Among Top ‘Devils’ of Meltdown
http://www.youtube.com/watch?v=D6xwh-19pWg (8-min)
I don’t buy in that the rating agencies are to blame: I blame those who believed the rating agencies’ ratings.
There was plenty of evidence around 2006-or-so that the rating agencies were cooking up their ratings but money-hungry investment institutions didn’t really care all that much.
To really care about how the game was played meant that one should not play the game at all. And if one did not play the game - rigged or not - then he would miss out on some very big bucks.
IMO the rating agencies are being used as fall guys.
“To really care about how the game was played meant that one should not play the game at all.”
But doesn’t the creation of the corporate 401k scheme mean Wall street has an ample supply of conscript investors?
Sort of like playing a game of Global Thermonuclear War in that the only way to win is not to play.
Unless one can search out the winning nitches such as the company match. And there is the cash-equivilent option, if offered.
“Unless one can search out the winning nitches such as the company match.”
I’m not sure that’s a popular option. “Hi Honey, I’ve decided to quit my family supporting job with the 401k and health-care benefits to pursue the niche lifestyle where I have choices.” “Hmm…know what? These legs are closed…welded shut!”
I’m not talking about quiting your job, I’m talking about taking advantage of the company match. Where did this “quit my family supporting job” come from?
“Where did this “quit my family supporting job” come from?”
Not sure. I’m thinking broadly I suppose.
However, the crux of the posted video link really isn’t the rating agencies, or people in houses they can’t afford; it’s about the fading middle-class income and the cash-out refinancing to bridge the gap between rising expenses and flat incomes.
***
Cell phone rings…chit, off to work I go!
But doesn’t the creation of the corporate 401k scheme mean Wall street has an ample supply of conscript investors ??
Well sure it does….Thats why in the early 1980’s, after a great deal of thought and obvious long term risk, I never bought into it…
“…Wall street has an ample supply of conscript investors ??”
Used to, at least.
Investors withdraw from US stock funds in May
By MARK JEWELL | Associated Press – Tue, Jun 12, 2012 4:14 PM EDT
BOSTON (AP) — Investors continue to be cautious with their money. May was the third consecutive month that they’ve withdrawn more cash from U.S. stock mutual funds than they deposited into them. Bond funds attracted new cash for the ninth month in a row.
Investors withdrew a net $4.8 billion from U.S. stock funds last month, industry consultant Strategic Insight said on Tuesday. Stock funds attracted cash in January and February, but not enough to offset the total that flowed out the past three months. Year-to-date, net withdrawals total $7.4 billion.
Last month’s retreat from stock funds came as major market indexes declined, and the average U.S. stock fund lost 4.2 percent, Strategic Insight said. Investors grappled with the widening debt crisis in Europe, weaker readings about the U.S. economy and Facebook’s disappointing initial public offering.
“U.S. investors’ psyches have been battered with a stream of negative news, whether disappointments in job growth or disappointing progress on the eurozone problems,” said Avi Nachmany, Strategic Insight’s research director. “This has exacerbated the caution that many investors already felt.”
He expects that investors will continue to favor bond funds over stock funds until there’s sustained job growth in the U.S. and progress in resolving Europe’s debt crisis.
…
Investors continue to be cautious with their money ??
Once burnt twice shy….
So much for occupying Wall Street. Looks like investors are deserting it.
To which I say: Couldn’t happen to a nicer Street.
When deciding whether to desert the street or not, don’t forget the sage advice of John Pierpont Morgan:
Conscript investors. I like that expression.
BTW, this conscript moved most of the retirement/long-term/whatever money out of stocks four years ago. I took the advice of my HBB homies, and I’d like to thank you for it. You helped me miss the crash.
Conscript investors. I like that expression.
+1. Great way of putting it, rms!
“Conscript investors. I like that expression.”
Even Vanguard’s cash fund, no guarantee; see the fine print. At today’s rates you might be better off stuffing your mattress dipping into the cash to buy an occasional abandoned storage locker’s contents at auction and selling the pieces on eBay, but you can’t manage your own retirement funds. Everything is stacked against the employee.
IMO the rating agencies are being used as fall guys.
So the risk experts lied in order to make big money, and the institutional investors knew they were lying, but ignored it so they could make big money, neither of them caring because it was Joe6Pack’s money that was at risk.
And some say we need to reduce regulations on these people?
“And some say we need to reduce regulations on these people?”
Heck yeah, without those Taggarts forging a brave new world, we’d all be just sitting around, sippin’ on 40s, scratching our heads.
Come take to _______ for your vacation! Buy a “home” here! Everyone wants to live here!
Beware…. It’s the height of Swindler Season.
Don’t be absurd. The height of the season is when there is still time to close and move before school starts. 8 weeks isn’t really long enough. There may be a few last gasps going on, but we are well past the height of the season.
Why do people want a vacation home?
Shouldn’t you logically just rent in a different fun place each year? Even if you were wealthy, shouldn’t you go to Paris for one year, Florence the next, and Kyoto after that?
And how much vacation does the average American get any way? Two weeks? Four weeks? I’m reasonably sure it’s not six weeks or higher.
Ultimately, I think it just comes down to “real estate goes up forever” so you might as well leverage, etc.
The Cool Cat gets it.
When I can rent a house on the beach every year for $2000 a year, why buy it for $5000/month?
Besides, who on earth wants to cook and clean on their vacation?
I take one to get away from all that.
And I love to cook! I do it daily and am passionate about it but even I need to get away from the chores.
I stick to my facts which is that they were speculating, and expected their “vacation home” to pay for their retirement.
That’s worked out really well, of course.
expected their “vacation home” to pay for their retirement.
This false notion is relatively new. I still don’t understand where it came from.
“Real estate goes up forever.”
Exactly.
The height of the home swapping season isn’t built on vacation home purchases anyway.
However, I agree with FPSS’s hypothesis, that going to the same place over and over is a little dull. And even if you do have one place that you prefer to go year after year, you don’t need a second home there. For a really good explanation, I strongly suggest chapter 12 (The Perfect Second Home) of Peter Mayle’s Acquired Tastes. He suggests finding a luxury hotel in the area you decide you will want to visit for several weeks over many years and making yourself popular with the staff. He estimated that he could spend three weeks a year in a suite in his favorite London Hotel with all the amenities (shoe shines, food, etc.) for just the yearly expenses of keeping a small flat in London. That, of course, completely excluded the capital outlay to buy the thing and any repairs or decorating or whatever that might be needed. The only thing you would miss was the ability to lend out your place to friends or family when you weren’t there. But, of course, if you don’t own a place in the vacation destination, people aren’t likely to resent you not letting them stay at the house you don’t have.
“However, I agree with FPSS’s hypothesis, that going to the same place over and over is a little dull”
Some people prefer tradition. I would kill to be on Skaneateles lake right now.
Mitt Romney and the New Gilded Age
But the real issue here isn’t Bain’s betting record. It’s that Romney’s Bain is part of the same system as Jamie Dimon’s JPMorgan Chase, Jon Corzine’s MF Global and Lloyd Blankfein’s Goldman Sachs—a system that has turned much of the economy into a betting parlor that nearly imploded in 2008, destroying millions of jobs and devastating household incomes. The winners in this system are top Wall Street executives and traders, private-equity managers and hedge-fund moguls, and the losers are most of the rest of us. The system is largely responsible for the greatest concentration of the nation’s income and wealth at the very top since the Gilded Age of the nineteenth century, with the richest 400 Americans owning as much as the bottom 150 million put together. And these multimillionaires and billionaires are now actively buying the 2012 election—and with it, American democracy.
http://www.thenation.com/article/168623/mitt-romney-and-new-gilded-age
I can’t keep it straight - is it all Bush’s fault or all Romney’s fault?
Bush….
“…Bush’s fault or all Romney’s fault?”
Friday, May 11, 2012 11:00 AM PDT
Romney’s Jamie Dimon problem
JPMorgan’s $2 billion blunder makes Mitt’s pledge to repeal Obama’s bank reform look dumb
By Andrew Leonard
Here is the most important sentence in Jamie Dimon’s Thursday afternoon conference call discussing JPMorgan’s colossal trading screw-up: “Just because we’re stupid doesn’t mean everybody else was.”
If you’re looking for the most easy-to-understand breakdown of how JPMorgan managed to lose $2 billion, read Marketplace reporter Heidi Moore’s fabulous explainer. Readers who fancy themselves financially sophisticated can ponder DealBreaker’s Matt Levine’s analysis. If all you want is a guide to the critics “flaying” Dimon’s hide, check out the New York Times’ DealBook.
But for our purposes right now, all you need to concern yourselves with is Dimon’s monumentally disingenuous self-castigation. Because Dimon is not stupid. Under his tenure, JPMorgan has been the best-run of the big banks. So Dimon’s self-criticism gets it all backward. The fact that JPMorgan was so very stupid is so very scary because we can rest assured that just about everybody else is doing things even more idiotic.
The whole point of the infamous “Volcker Rule” included in the Dodd-Frank bank reform act is to restrict the banking sector’s ability to clobber the economy by doing dumb things. As the Huffington Post’s Mark Gongloff noted, if a strict version of the Volcker rule had been in place, JPMorgan, quite possibly, would have been prevented from making a bet that would lose the bank $2 billion — or more.
…
They think it is up to $9 billion now.
I’ve heard that figure too. One wonders when it will bust through the $10 billion mark.
Saw that.
“$10 bn mark”
It most likely will, and we most likely will collectively shrug.
“I can’t keep it straight - is it all Bush’s fault or all Romney’s fault?”
Actually it’s the America loathing progressives that are to blame.
Happy Independence day!
Happy regression day!
Thanks…hold on…what?
“progressives / regression”
I figured if you were against progress, you probably celebrated ‘regress’…
If progress is the bubble-driven economy of the past 15+ years, give me regress any day.
ahhh, that one went right over my head, must be lack of sleep
Trickle-Down Distress: How America’s Broken Meritocracy Drives Our National Anxiety Epidemic
America is turning into a country of hand-wringers. Nearly one in five of us — 40 million American adults — suffer from anxiety disorders, the most common class of psychiatric ailment we have. By comparison, a mere one in ten are plagued with mood disorders like depression, the second most-common class of psychiatric problems. Panic attacks often besiege Daniel Smith, author of the new anxiety memoir Monkey Mind, out July 3, while others suffer from generalized anxiety disorder, persistent and excessive worrying about everyday things; social anxiety disorder; and a host of other fretful conditions.
http://www.theatlantic.com/health/archive/2012/07/trickle-down-distress-how-americas-broken-meritocracy-drives-our-national-anxiety-epidemic/259383/
They only suffer this because they are leveraged up to their eyeballs, and their children are leveraged up to the hilt before hitting even 18 (student loans.)
Try living within your means. It’s shocking how little anxiety there is.
Real wages have been falling my entire lifetime. Even if with no debt, most are just treading water.
While there is substantial truth to your statement, the fact is the same statement was true 20 years ago.
If real wages had been falling continuously, what should you logically have advised your children?
Live within your means, save aggressively. Try not to get swept up in consumer culture.
Watch what happened. We went on the largest binge in history instead.
I’m not buying your argument. And incidentally living standards in the US are far far higher now than they were 30 years ago!
Far too many have indeed, overleveraged themselves. However, the middle class, as a percentage of the total population, HAS shrunk.
That alone shows that living standards are not better than 30 years ago, even though science and technology have brought us vastly improved things, you have to be able to afford them.
Middle class is an aberration of WW2 when the the US was the only developed economy left standing and the rest of the world had been bombed into smithereens.
There is nothing “eternal” about the middle class or even the concept.
Part of the anxiety is from not being able to achieve the lifestyle we’re constantly told we should be living by the marketers trying to sell us stuff. Once you realise it’s a load and reject what ‘they’ portray as life, you’re a lot better off.
So, you agree with Bub Diddley and ecofeco that the middle class has shrunk, and thus your earlier statement that living standards have gone up since 1982 is wrong. Just wanna get this straight.
IAT
Middle class is an aberration of WW2 when the the US
So we should be grateful to live in a shack with basic heating and call it normal? I assume that when the US finally turns into a third-world country, you’re going to be one of our 1% overlords?
oxide said: “So we should be grateful to live in a shack with basic heating and call it normal?”
It doesn’t matter what your angst or opinion is about it. It’s coming anyway. There’s literally nothing you can do about it… except to adopt frugality standards and therefore be a “first adopter”, beating out fellow citizens to be the most well off amongst the set of impoverished Americans.
The wealth is fleeing. You can’t do anything about that, since it’s not your wealth. Every time you try to take possession of it, through the force of government, the wealth only flees FASTER.
Workers having any power at all, was the aberration. This is documented fact. And the real status of Humanity is taking back control: The 1% controlling 99% of everything, leaving the 99% to fight like dogs over the remaining 1%. We’re a very hierarchical species. As given in the works of Robert Wilson, this is the biogram. The middle class in the USA was the logogram. The biogram will override the logogram eventually. Biology ultimately trumps all social rules. And biologically, we’re violent, jealous and vengeful animals who always fight in support of the alpha-beta social structure. Socially, across the centuries, our aggressive, selfish animal nature is very dominant over things like feelings like compassion and ideas like justice.
The United States wasn’t even an experiment in liberty and justice. We expanded across the continent killing the natives as we went, imprisoning, killing or impoverishing anyone who opposed that relentless drive to own more than the other apes. But even under the social-experiment model, we’ve failed. We had to fail. We opposed the biogram, after all.
+1 cat….There it is right there….
America’s Broken Meritocracy
When hard working savers are being out-classed by their profligate neighbors whose debts will become the saver’s yoke I would certainly expect anxiety disorders. No?
It’s the neighbor-vrs-neighbor version of Greece vrs Germany, sponsored by your friendly neighborhood investment banker who makes money on both sides of the trade.
The past decade was a great time to buy:
http://www.statesman.com/news/local/austin-property-taxes-jump-38austin-property-taxes-jump-38-over-past-decade-2407438.html
Austin property taxes jump 38% over past decade
The property tax bill for a typical Austin home rose 38 percent between 2000 and 2010, adjusting for inflation, while the median income remained stagnant, an American-Statesman analysis has found.
For many people I know in the NE - the payment for taxes is larger than the payment for P/I.
Hey - public union thugs gotta retire after 20 years with spiked pensions - it is the American way.
We never really own our homes - do we? We only rent it from the state. And the state does not play games like the banks do with non-payments.
They will send another public union thug with a gun to kick you out - very quickly.
Your Republican trolling is uninformed, and only reveals your partisan ignorance. Union goons aren’t the problem in Austin, more like massive tax breaks to corporations, developers, and Formula 1 billionaires, while the regular citizens get stuck with the bill.
Bernie Ecclestone could have afforded to pay for his own racetrack, Apple could have afforded to pay taxes on their new facility, the world’s largest retailers could have afforded tax on their outdoor mall/condo monstrosity. Instead, the regular people get stuck paying to build all the infrastructure that supports these billionaires, while receiving little benefit. Meanwhile, wages of the union goons in this town haven’t kept up with the increase in the cost of living.
Tax the billionaire “job creators” and give the citizens a tax break.
Tax the billionaire “job creators” and give the citizens a tax break.
Or at a minimum, at least tax them at a rate that is as high as the rate that I pay.
“Union goons aren’t the problem in Austin, more like massive tax breaks to corporations, developers, and Formula 1 billionaires, while the regular citizens get stuck with the bill.”
Mis-identify the source of the problem and you risk the wrong solution. Union contracts may be part of the problem in some places, but not in all places and probably not the whole problem even in California and New York.
Corruption, misplaced optimism during the boom, and recession induced declines in tax receipts have contributed their fair share to the problems that state and local governments are having. If you don’t deal with the other problems, breaking unions will provide no benefit to the city and its taxpayers. Taxes will remain elevated to line the pockets of other parties.
Tax breaks for corporations to move from one locale to another may be good in the short term for one municipality, but in the long term, they are a cancer that pits one city against another in a race to the bottom.
For many people I know in the NE - the payment for taxes is larger than the payment for P/I ??
Yep….Its the municipalities own little money printing machine…Balanced budget ?? Hell thats easy…..
property taxes jump 38% over past decade
That actually doesn’t sound that high to me, considering that the Federal Reserve’s stated goal is to make all costs double roughly every 20-30 yrs.
The boosterism continues, this time at CNN, the rapidly fading media giant:
‘As if record low mortgage rates and beaten down home prices weren’t enough to get prospective home buyers off the fence, there’s another factor that has made the case for buying even stronger: rising rents. ‘With rents rising faster than prices in most markets, buying is getting even more affordable relative to renting,’ said Jed Kolko, Trulia’s chief economist.’
‘Most of the markets that saw the biggest home-price increases were among those hit hardest by the foreclosure mess.’
Well ain’t that a coincidence, and all at the same time too!
‘Kolko does not expect the rallies to continue. “These increases will shrink or reverse as the backlogged foreclosures in these metros hit the market,” he said.’
Man oh man, that backlog must be really logged by now. How long have we been hearing about this, 4 years now? What amount of time do the GSE’s need to figure out how to sell a foreclosure?
Here’s an anecdote; a couple of days ago I got an email about a ‘new’ listing in a town here in N AZ. I recognized it immediately. It’s a Freddie Mac house that I inspected in early 2009! At the time, it was being broken into regularly and used as a place to do drugs, etc. Several windows had been boarded up. The lady across the street told me then she wanted to buy it for her sister so they could be closer to each other. So after watching it sit in that condition for over 3 years, I guess she might have a chance now.
“Man oh man, that backlog must be really logged by now.”
The bowels have gone from merely constipated to impacted.
What is the Colace for the housing market?
Look…. I’ve been saying for 2-3 years now that these houses are statused as in contract, then fall off the MLS and then reappear 6 months to a year later as a new listing. A few Housing Pimp sympathizers would make some lame excuse like “maybe it sold and got repossessed”. BS.
Phoney, Fraudie, SkankofAmerica and Shittybank are all doing it. This is the biggest scam since the idea of banking.
In 2009 I was messing around with BofA hyperlinks in the address bar and stumbled on tens of thousands(possible hundreds of thousands) of defaulted property in every state. I was stunned.
This housing mess and the current charade (lie) is 100% manipulated by the very top.
Indentured slavitude is voluntary.
Indentured slavitude is voluntary.
Now, RAL, darling, if only you could turn that into your moniker, I could get behind you.
Although anything gets boring when encountered daily. That’s what your wife tells me.
Heh….. She’d tear your ass up.
That line gets boring when encountered repeatedly.
That’s not what your daughter said.
You guys who never felt the wound of dealing with a teenage daughter to deal with ought not jest at scars.
8-/
Latest development in the teenage daughter saga, and question for the HBB brain trust:
Yesterday, while hanging out with her boyfriend non grata at the beach, she backed out in front of a lady whose car she hit on the passenger-side door. The door no longer opens and the passenger side mirror was damaged.
My question: Would it be wiser to pay for the lady’s repairs out of pocket, or to have our insurance company settle the claim, and deal with the premium hike? I have little judgment in such matters, as I religiously avoid ever having automobile “accidents.”
(I already proposed the strategy of letting the insurer handle the claim, then cancelling my daughter’s insurance before paying many of the increased premiums, but wifey and daughter nixed that plan. I told them they need to figure out how to finance the cost of either higher premiums or paying for repairs out of pocket.)
An out of pocket under the table deal can work well with someone you trust, but I’d hesitate to enter into such a deal with a stranger. Maybe in one of those cases where they don’t even know who you are and you hand them cash and you never see each other again. But I’d hate to get into a deal where they kept hitting you up for more money or threatening to make a report after you’d already given them a significant amount. Has an amount been discussed yet?
But I’d hate to get into a deal where they kept hitting you up for more money or threatening to make a report after you’d already given them a significant amount.
That seems easy enough to avoid: simply have them sign a standard liability release form, indicating that you have no continuing liability for damage to the automobile, themselves, etc etc etc. It’s what the insurance companies always have people sign to avoid the same issue.
Great suggestions, guys — I knew at least a couple of regulars could offer some.
The lady is pricing the repair, and is supposed to get back to us on what it would cost. If it sounds exorbitant, we will hand it over to our insurer and take the premium hit.
We will ask my (attorney) FIL about the standard liability release form.
PB, you might even be able to get a sense from your agent of what it would do to your premiums if you were to file a claim… If so, you could do the math to figure out the break-even period.
So after watching it sit in that condition for over 3 years, I guess she might have a chance now.
But after three years of neglect, how much less is it worth now??
And would she even still want it?
It would be interesting to know if they fixed it up, and how much they spent on that…
Couple of abandoned houses up the street just got bulldozed.
And here’s the amazing part: I’ve lived down here at the Arizona Slim Ranch for almost eight years. Never once during that time has one of those houses been lived in. The other one? I think it was bailed on a year or two ago.
So, if these were GSE-owned, man, were they slow.
Curious, Slim: do you know what the insides were like? Were they truly not salvageable or salable?
It blows my mind that they would pay to bulldoze houses that could be sold at some price, if that is the case…
Remember that the GSEs have a $400 bn credit line from the Treasury. So they can afford to bulldoze valuable homes if they please — the taxpayers are picking up the destruction tab (lost value of the homes that are bulldozed plus bulldozing labor and equipment costs).
Prime_Is_Contained said: “It blows my mind that they would pay to bulldoze houses that could be sold at some price”
It’s because municipalities are an active conspiracy to support high prices for property. Property developers are almost always heavily involved in local government. That’s why you end up with such a fat packet of property regulations. And that’s why a certain magic number exists for each property, below which nobody bothers with it. The municipal property-development scam sets the number. And it’s a lot higher than zero.
One of the goals of the scam is to keep the poor from avoiding paying rents. You’d think that degraded properties could be matched to people with a degraded wealth base. In other words, cheap housing for poor people. But the property developers can’t make as much profit on that. In fact, as more and more property degrades and falls into the hands of poorer people for cheap (degraded) prices, there’s a lot of rent-profit potential lost. Thankfully, the developer mafia long ago took control of the local agencies that govern inspection and certification. So they just declare the housing unfit for Human habitation, and it’s destroyed. Gotta love that potlatch.
We’re a nation with millions of poor and at least a million documented homeless, but we’re destroying perfectly habitable (from the homeless standpoint) buildings by the dozens in each city each month. You can’t get different rules enacted for these properties. The municipality assumes you’re just as financially capable of paying for all those permits and improvements. As a civilization, we’re demented.
“The municipal property-development scam sets the number. And it’s a lot higher than zero.
…
We’re a nation with millions of poor and at least a million documented homeless, but we’re destroying perfectly habitable (from the homeless standpoint) buildings by the dozens in each city each month.”
Reprehensible, but unfortunately, also plausible — especially for San Diego.
The municipality assumes you’re just as financially capable of paying for all those permits and improvements.
And if you’re not, the municipality would rather move you along, and get someone else in who is capable of paying higher property taxes. The thing about having degraded housing stock sitting around is that it is not worth much, and not begin worth much, it does not assess for much property taxes.
The reason municipalities who insist on keeping real estate prices artificially inflated, rather than selling what is available at prices the market will bear, is that soon they have no green shoots of young families moving into the area who can take root and provide the growth of the city into the future.
Look at places like Gary, Indiana or Stockton, California to see where housing prices that are too high for too long relative to economic fundamentals will get you.
I just took a look at the predictions that were posted a couple of days
ago .
Years ago when I first connected with this blog ( 2005) ,and I found out about the kind of loans they were making and found out about the Wall Street casino markets ,I originally got visions in my mind of pain and suffering on the level of the Great Depression .
At that time I was unaware that the corruption and unsustainable
systems extended to other major systems other than Financial markets and it extended into the Medical industry ,the food industry ,the judicial system ,Politicial systems ,the FDA and other regulatory agencies ,and just about every system that people are dependant on .
Whatever this was that hijacked the Grand Bee Hive , it came like a thief in the night while people were sleeping and not watching and to busy with normal lives to notice and to trusting to suspect this level of insanity was growing like a cancer .
Great minds from History gave numerous warnings of how possible this hijacking was to happen and how it would crush the freedoms that were declared for Americans on July 4th ,so many years ago .
My prediction is more kicking the can down the road by artificial means ,while ignoring the rule of law ,and at the same time passing any pain to the majority of the population ,while the corrupted systems are protected ,while the government continues to be the pawn for those systems of corrupted power . Attempts will be made at even limiting the power of the people to revolt ,while the bought off information systems will continue to broadcast the offical stories
to protect the Officials and corrupted systems . Confuse and disfuse
the peoples ability to reject ,object ,or revolt ,while increasing
the Monopolies powers .
I also have a prediction that maybe the majority population in America
might get so screwed over and over again that they wise up and take back their Country . A entire overhaul is required now .
The majority of the population now gets something for nothing from the government.
They do not want ANYTHING changed.
I also have a prediction that maybe the majority population in America might get so screwed over and over again that they wise up and take back their Country . A entire overhaul is required now .
Zbanana.. That would be part of the correction process ,the fact that people have become this dependant on goverment cheese. Its not sustainable long term .
Its not sustainable long term .
No, but I suspect it could get a LOT worse before any significant fraction of the populace is sufficiently enraged about it to do anything. And by that time, the other half of the populace will be FAR more dependent, and far more willing to fight to maintain it.
So while it may not be sustainable long-term, I think it will not change other than slowly in the short-term. We have decades of pain, so likely our remaining adult lives.
But by the time that it does come to a boiling-point, the divide will be far wider than today. The result will not be pretty.
prime is contained ….I tend to agree with you that how you think it might play out will happen . But than again, it might play out in a total different way .
It’s never happen ever ever ever. Not in my lifetime (if ever!)
Americans are too fat and complacent. Give them more cheap sugar water and food and you can forget about rebellion.
All of these are fantasies. Most couldn’t even tell you who the VP is let alone what Goldman Sachs is.
This blog severely overestimates what the average American’s teeny-tiny brain knows.
The timing is always much harder to predict than the direction…
“This blog severely overestimates what the average American’s teeny-tiny brain knows.”
Don’t look at me, bro’…
Prime_Is_Contained said: “So while it may not be sustainable long-term, I think it will not change other than slowly in the short-term. We have decades of pain, so likely our remaining adult lives.”
Those are exactly my plans. I got lucky when the drop in housing prices matched a near-peak in my savings pile. So I jumped in and now won’t ever have to worry about a landlord putting all of my stuff out on the curb, neither a banker having some hired thug do that. I’ve faced down too many years of unemployment; now I don’t have to live in such mortal terror anymore.
But much of the rest of the population does. Well, too damned bad. They shouldn’t have loaded up on debt. They shouldn’t have been out there buying a new car every 4 years. Screw their huge mortgages and student-loan debts. And nobody actually has the right to raise a child that they can’t support financially.
The only real terror I have today is being taxed to death through my property and infrequent bouts of having actual employment income. The tax bill for all this government borrowing is coming.
And nobody actually has the right to raise a child that they can’t support financially.
I saw a young Latino woman with a clutch of darlings at lunch today. She was having trouble walking through the parking lot traffic while keeping track of all those f*king kids. I can barely afford my two kids, and I make decent money for the area. Meritocracy and anxiety?
The only real terror I have today is being taxed to death through my property and infrequent bouts of having actual employment income.
There is safety in numbers; in other words, they can’t really single you out for a larger tax very easily. And if they were to tax everyone at exorbitant property-tax rates, there would be a revolt.
So yea, it might get jacked, but I wouldn’t expect it to get jacked to the point where people are up in arms.
They do not want ANYTHING changed.
Take away their cable and dish and satellite TV. Only then will we get any kind of revolution.
“Whatever this was that hijacked the Grand Bee Hive”
The global progressives spreading their filth, lies and destruction like a pandemic virus.
Wow, the more I read this post, the more brilliance I see in that one simple statement…and I am not one to pat myself on the back. Would be nice to have Hugo Weaving recite it complete with his Agent Smith attire.
Would be nice to have Hugo Weaving recite it complete with his Agent Smith attire.
And now I can’t read it and hear any other voice saying it.
Celebrating America’s libertarian heritage. This day belongs to fans of Gary Johnson, Ron Paul, and the late Barry Goldwater.
Don’t forget the Koch Brothers.
Let
freedomno bid contracts ring!!What really yanks my crank about those contracts is that there’s this huge effort made to lure small business people into thinking they can get government contracts.
Alas, the reality is quite different. Quite a few big companies acting like small businesses in drag. Not to mention the no-bid contracts.
AUTO SALES SOAR; FEARS OF SLOWING MOMENTUM ARE EASED
Bad economic news hasn’t kept buyers out of showrooms
By DEE-ANN DURBIN ASSOCIATED PRESS
12:01 a.m., July 4, 2012
Updated 4:33 p.m., July 3, 2012
From mini cars to monster pickups, sales of new cars and trucks surged in June and eased concerns that Americans would be turned off by slower hiring and other scary headlines.
Automakers sold nearly 1.3 million cars and trucks in June, up 22 percent from the same month last year. Chrysler posted its best June in five years. Sales soared at Volkswagen, which is on track for its best year in the U.S. since 1973.
The results allayed fears that the car market’s momentum had stalled. U.S. sales were on track to reach 14.5 million after the first four months of the year. But the annual pace dropped to 13.8 million in May, as the stock market plunged and hiring slowed. June brought more worrisome news about jobs growth and consumer confidence.
But buyers didn’t go away last month. In fact, June’s sales pace rose to 14.1 million, according to Autodata Corp. And if sales stay at that level for all of 2012, it will be the industry’s best year since 2007.
Falling gas prices, cheaper loans and new models like the Ford Escape and Dodge Dart drew buyers. A revived housing market lifted sales of pickups. And there was still plenty of demand from people who bought cars in the middle of the past decade and needed to replace them. Annual sales hit a high of 17 million in 2005, and those cars and trucks are now seven years old.
“If a family in Iowa’s only mode of transportation is on the fritz, they are going to buy a replacement vehicle, even if Spain’s economy is on the brink of collapse,” says Alec Gutierrez, a senior market analyst at Kelley Blue Book.
…
And…
cheap liar loans are still available for people who can NOT afford these new cars.
and you can STILL roll your previous loan from your last car to buy a new car (loans at 140% of the value of the “new” car).
And they will be dump these non-performing loans right on to the taxpayers just like GMAC did with obamamotors
The circle of life…
I seem to recall the GMAC was one of GM’s few profit centers before the BK, and was sold off to raise money. Its mortgage unit did have trouble later, but as far as I know the car finance unit never lost any money.
Oversight panel blasts $17.2 billion bailout of GMAC
3/11/2010 - USA Today
A congressional watchdog today criticizes the $17.2 billion bailout of auto financier GMAC, saying the Treasury Department missed opportunities to protect taxpayers’ money.
http://www.usatoday.com/money/autos/2010-03-11-gmac11_ST_N.htm
Car loans are securitized and sold. I was doing this for Ford Motor Credit in the 90’s.
Has this blog become aware yet of the eminent domain proposal in San Bernardino county? Government forces a buy back of mortgage securities at fair market value and then resells house back to owner.
http://www.loansafe.org/business-groups-resist-san-bernardino-county-eminent-domain-proposal
The free sh*t army on the move in San Bernardino.
If they can seize mortgage loans for the “public good” - what can’t they seize?
Speaking as someone who lives in a nabe that has been hit hard by the housing meltdown, I’m going to commit HBB heresy and say that I don’t think that this is a bad thing.
Why? Because houses need people living in them and taking care of them. So do neighborhoods.
Yes, I have done more than a bit of kvetching about some of my neighbors, and you can be sure that I’ll be back to do more, but there are other people around here who are really cool. I’d like to see them stay around.
I’m going to commit HBB heresy and say that I don’t think that this is a bad thing.
It’s a huge stretch to apply eminent domain to anything securities-related. Eminent domain allows the government to take private property (ok, compensated taking) for a public good, but that has generally only applied to physical property—e.g. the land for a road/highway, etc. Even the expansion the SCOTUS allowed in conceiving that “property development” could be a public good comes nowhere close to this idea.
It will never make it through the courts.
I’ve long advocated for local governments to address the problem of empty/abandoned houses by cranking up the fines for code violations, and then VERY actively pursuing liens, and then going after the title if/when the fines are not paid.
That would get the lenders/GSEs attention, and I believe it would be completely allowable under existing law.
I’m going to commit HBB heresy and say that I don’t think that this is a bad thing.
All it does is transfer control from the global thugs to the local thugs.
It changes nothing. The good deals will go to the connected ones. You delude yourself if you think that this is the answer.
Asusming it can be done as Prime above has maintained which I don’t think can be done (as noted above.)
I don’t know, Prime. The Supreme Court let the state take over physical land when the only “public purpose” they asserted was to sell it to developers who would build something on it that would pay higher property taxes than the current owners. They threw in the word blight, but that was really just window dressing.
I see this as more of a play to force the banks to start paying the property taxes than anything else, but if you take the precedent seriously, it could, possibly, work.
Exactly where they are going to find a mortgage backed security that only contains mortgages (or is even over 50% backed by mortgages) in one county, I have no idea. I thought they were generally diversified. That is one of the ways they justified the magic math that made them safer than holding a pool of local mortgages.
Exactly where they are going to find a mortgage backed security that only contains mortgages (or is even over 50% backed by mortgages) in one county, I have no idea.
That’s part of my thinking as well, polly. And that’s part of why it would be over-reaching and would get thrown out. No such bonds exist, and I don’t think they can go claiming bonds that represent houses all across the country.
What they probably _could_ get away with, though, is taking the homes themselves from the trusts (in the case of REO), or from the owners (and paying some pittance on the mortgages held by the trust). That would accomplish the same thing, without any of the confusion being injected into the discussion by the bonds.
I think they are framing it completely wrong… But in its current form, it sounds like a non-starter to me.
Correct, Polly. The Kelo Decision was one of the last straws with the SCOTUS. Now a corporation or other business can take your property away from you as long as it shows that it can make more money with it. Nobody was safe after that decision.
And then the Roberts Decision (on Obamacare) determined that the government can do anything it wants to you; it could tax you for being gay, or being non-union. Why do we even have a SCOTUS? It clearly serves no purpose for the people.
Hi, CCC. Missed your posts. Please hang around?
Another scumbag lying realtor facing 60 years in the slammer for fraud(what else?)
http://7thspace.com/headlines/416060/four_defendants_including_realtor_and_loan_originators_indicted_in_alleged_91_million_mortgage_fraud_scheme.html
You want my home, it will cost you your life’: Five dead after German gunman ‘took hostages when bailiffs arrived to evict him from his flat’
Read more: http://www.dailymail.co.uk/news/article-2168598/Five-dead-German-gunman-took-hostages-bailiffs-arrived-evict-flat.html#ixzz1zftw1J8G
Sounds like he was more like a psycho.
The victims were tied up and ‘executed’, according to the local prosecutor. ‘This was a planned act and we are dealing with four cold blooded murders,’ he added.
Only photos of police hiding behind balaclavas; no fat section 8 peeps crying and hugging each other? Oh yeah, 70% are renters. Yikes!
THIS LAND IS YOUR LAND
words and music by Woody Guthrie
performed by The Boss
Chorus:
This land is your land, this land is my land
From California, to the New York Island
From the redwood forest, to the gulf stream waters
This land was made for you and me
As I was walking a ribbon of highway
I saw above me an endless skyway
I saw below me a golden valley
This land was made for you and me
Chorus
I’ve roamed and rambled and I’ve followed my footsteps
To the sparkling sands of her diamond deserts
And all around me a voice was sounding
This land was made for you and me
Chorus
The sun comes shining as I was strolling
The wheat fields waving and the dust clouds rolling
The fog was lifting a voice come chanting
This land was made for you and me
Chorus
As I was walkin’ - I saw a sign there
And that sign said - no tress passin’
But on the other side …. it didn’t say nothin!
Now that side was made for you and me!
Chorus
In the squares of the city - In the shadow of the steeple
Near the relief office - I see my people
And some are grumblin’ and some are wonderin’
If this land’s still made for you and me.
Chorus (2x)
If the individual mandate can be seen as a tax on those who do not have health insurance, then can the mortgage interest deduction be seen as a tax on those who do not have mortgages?
Because:
1) If you DON’T have X, you DO pay a tax.
X can be health insurance, or a mortgage. Because the bottom line is not the handwaving and PR ball-jiggling about what the name of the money I’m paying to the government is. “Oh, this is a Happiness Enhancer, not a tax,” etc.
The bottom line is the money that I’m paying to the government. Call it “Fairy dust” or “Happiness Enhancers”, it’s money I’m paying out. And money I pay to the government is a tax.
If the individual mandate can be seen as a tax on those who do not have health insurance, then can the mortgage interest deduction be seen as a tax on those who do not have mortgages?
I had the exact same thought yesterday, Neuromance. I think that by Roberts’ twisted logic, it could be.
And perhaps it is, when you ignore words and get to the heart of the matter. I am currently paying the “no-mortgage tax”. Apparently the federal government thinks I should be mandated to have one.
And when you think about the “no-mortgage tax” in this way (and it really is what I am paying), it does make the individual mandate under the ACA seem less offensive.
It isn’t a separate tax. It is a part of the income tax. Has been as long as the deduction has been there. When it was a general deduction for all interest (not just mortgage interest) it was a deduction that wasn’t available to people who had debt.
Oh, and the serious news analysts who discussed this as soon as the decision came out used the various credits and deduction for having a child. You have a minor child or other dependent, you can get them and avoid paying part of what your income tax would otherwise be.
And it isn’t related to owning a house, just on having to pay mortgage interest. The property tax deduction is related to ownership of a house.
A deduction and a penalty are two sides of the same coin. Purely a matter of perspective.
To the person receiving the deduction, it’s a reward. To the person not receiving it, it’s a penalty.
Scenario 1: Person X and Person Y both receive a 50,000 dollar tax bill. By the time the deductions are calculated, person X only pays 30,000 dollars, whereas person Y pays 50,000.
Scenario 2: Alternatively, person X and person Y could receive a 30,000 dollar tax bill. But because person X is not engaging in certain approved behaviors (buying a house, having a kid), he is hit with penalties. He then has to write a bill totaling 50,000 dollars.
The only difference in the two scenarios is manipulating the people’s expectations with the language used. Slapping everyone with a high bill and calling givebacks “deductions” is much more politically palatable than slapping everyone with a low bill and imposing penalties on those who are not engaging in rewarded behaviors.
Whistleblowers win $46.5 million in foreclosure settlement
By James O’Toole @CNNMoney July 2, 2012: 8:33 AM ET
NEW YORK (CNNMoney) — Getting served with foreclosure papers made Lynn Szymoniak rich.
(she was already rich if you count the $1 million cash out refi money she took that she didn`t pay back to get foreclosed on)
While she couldn’t have known it at the time, that day in 2008 led to her uncovering widespread fraud on the part of some of the country’s biggest banks, and ultimately taking home $18 million as a result of her lawsuits against them.
Szymoniak is one of six Americans who won big in the national foreclosure settlement, finalized earlier this year, as a result of whistleblower suits. In total, they collected $46.5 million, according to the Justice Department.
A judge signed off on the agreement in April, and in May — Szymoniak received her cut.
“I recognize that mine’s a very, very happy ending,” she said. “I know there are plenty of people who have tried as hard as I have and won’t see these kinds of results.” (just four years of free living and a $2000 check)
Szymoniak’s case was only partially resolved by the foreclosure settlement, and she could be in line for an even larger payout when all is said and done. (The queen of the Deadbeats damn sure deserves it! Why she won`t even have to join a gym for the morbidly obese, she can build her own or just have a plastic surgeon roll up a 50 gallon drum and go with an expensive liposuction job.)
As an attorney specializing in white-collar crime, the 63-year-old Floridian was well-placed to spot an apparent forgery on one of the documents in her foreclosure case, one she saw repeated in dozens of others she examined later.
“At this point, the banks are incredibly powerful in this country, but you just have to get up every morning and do what you can,” she said.
The other five whistleblowers in the settlement came from the industry side, putting their careers at risk by flagging the banks’ questionable practices.
Kyle Lagow, who won $14.6 million in the settlement, worked as a home appraiser in Texas for LandSafe, a subsidiary of Countrywide Financial. He accused the company in a lawsuit of deliberately inflating home appraisals in order to collect higher claims from the FHA, and said he was fired after making complaints internally.
Gregory Mackler, who won $1 million, worked for a company subcontracted by Bank of America to assist homeowners pursuing modifications through the government’s Home Affordable Modification Program, or HAMP. Under HAMP, the government offers banks incentive payments to support modifications.
I have to laugh at the gambling industry trying to rename itself the “gaming industry.”
Kenny Rogers wrote “The Gambler” not “The Gamer.”
“Gaming” sounds so much more respectable than “gambling,” which used to be illegal and controlled by the mafia.
“Gaming” sounds like _fun_!
“Gambling” sounds like a washed-up wreck.
“Gaming” sounds like everyone wins.
“Gambling” sounds like you win a few, the house wins most.
Posted: 11:30 a.m. Wednesday, July 4, 2012
Federal report faults Fannie Mae and Freddie Mac oversight of repossessed homes
By Kimberly Miller
Palm Beach Post Staff Writer
West Palm Beach —
Lax oversight of thousands of contractors charged with maintaining foreclosed homes allowed neighborhoods to deteriorate and left mortgage backers Fannie Mae and Freddie Mac vulnerable to fraudulent billing, according to a federal report released last month.
More than 12,600 Florida homes were owned by the two enterprises at the end of 2011, the third highest of all states and 7 percent of their total inventory.
Nationwide, Fannie Mae and Freddie Mac owned a combined 179,000 homes at the end of last year, triple their 2007 inventory, the report by the inspector general of the Federal Housing Finance Agency notes.
Yet, from 2008 through most of 2011, the agency did not conduct targeted reviews of the enterprises’ foreclosure management programs or the approximately 10,000 contractors hired to mow lawns, repair roofs, change locks, maintain pools and paint.
Specific problems outlined in the report include;
• Background checks were not always performed on contractors.
• Fannie and Freddie lacked controls to guard against duplicate reimbursements, unnecessary repairs, or payments for work not completed.
• Complaint tracking and monitoring of corrective actions was limited.
Shoddy maintenance of foreclosures costs everyone, the report says, driving up damage expenses paid by Fannie Mae and Freddie Mac, “lowering the value of surrounding properties and increasing blight and crime,” the report says.
According to the U.S. Government Accountability Office, vacant and foreclosed homes may reduce prices of nearby homes by $8,600 to $17,000 per property.
Debbie Smith, broker/owner of Home Run Real Estate west of Lake Worth, was surprised by the report’s criticism.
Her firm specializes in selling bank-owned homes and has many Freddie Mac listings. As the listing agent, she said she pays for most contractor work and is reimbursed by Freddie Mac. She considers herself responsible for monitoring a home’s upkeep.
“We visit the homes every week,” Smith said. “Freddie wants our properties to look like any regular sale. They’re pretty tough.”
Other lenders, however, may not be as fastidious in watching contractors.
“There are some companies out there that don’t follow the rules,” she said.
Several Palm Beach County cities, as well as the Board of County Commissioners, require banks to register vacant and abandoned homes. In unincorporated areas, banks must pay $150 to register a property and are required to provide the names, phone numbers and email addresses of property managers responsible for upkeep of the homes.
But part of the maintenance problem is intertwined with Florida’s foreclosure laws. Until a final judgment of foreclosure in favor of the bank is made in court, the homeowner remains the owner of the property and responsible for its care.
In some cases, if lenders believe the home is abandoned, they can change the locks to secure the property and prevent vandalism.
But even that can be a volatile situation. Smith said one of her agents, whose home was on the market as a short sale, returned from a week-long vacation to find her locks changed.
In April, a Wellington woman filed a lawsuit against Bank of America after her locks were changed following two missed mortgage payments. Robert Parr, an attorney representing homeowner Heather Andrews, said the contractor doing the work also taped the home’s toilets shut. After Andrews had the locks changed back, the contractor returned asking questions about who was living in the home.
“When they continued to poke around she was fully reinstated and in proper standing on the loan,” Parr said. “They never had any reason, even based on the contract laws, to do what they did.”
Fannie Mae wrote in its 2012 first quarter report that as of March 31, it was unable to sell 48 percent of its foreclosure inventory for reasons that included state laws that allow owners to stay in their homes for a certain period of time. The time period, called “right of redemption”, is when the homeowner can buy back the home and varies by state. In Florida the right of redemption period basically lasts until a certificate of sale is issued to a new owner after an auction.
“Fannie Mae’s overall strategy is focused on maintaining, repairing and selling properties in a way that helps stabilize neighborhoods and maximizes the return for taxpayers,” said Andrew Wilson, senior manager for Fannie May corporate communications. “We carefully monitor our repair and maintenance vendors to ensure that we are using our resources appropriately.”
Between 2007 and 2011, Fannie Mae and Freddie Mac spent $8.4 billion in upkeep of their foreclosed homes, according to the inspector general report.
——————————————————————————–
States with highest number of foreclosures owned by Fannie Mae and Freddie Mac
Michigan, 22,605
California, 19,972
Florida, 12,618
Illinois, 12,471
Georgia, 11,962
Minnesota, 8,765
Ohio, 7,503
Texas, 6,782
Arizona, 6,070
Washington, 4,854
Source: Federal Housing Finance Agency
Don’t worry - the same people will be in charge of our health care too…
“Between 2007 and 2011, Fannie Mae and Freddie Mac spent $8.4 billion in upkeep of their foreclosed homes, according to the inspector general report.”
All those tax dollars were spent to keep those houses maintained, when they could have just sold them at current market prices to potential owner-occupants who would have privately borne the upkeep costs.
There is something rotten in Denmark.
California (a democrat/liberal controlled state for at least a generation now) is a lost cause. The state is facing fiscal collapse and they want to dig their financial hole deeper with this silly immigration enforcement bill.
I think I will call them the George Costanza of states. Anything they do - any state should do the opposite.
—————————————-
In California, immigration bill designed as the “anti-Arizona”
Reuters | July 4, 2012 | Mary Slosson
While America’s debate over immigration has been dominated recently by crackdowns in states like Arizona and Alabama, California legislators are trying to turn that tide with a bill to protect illegal immigrants that they dub the “anti-Arizona.”
Last week, the top U.S. court upheld the most controversial aspect of Arizona’s immigration statute: a requirement that police officers check the immigration status of people they stop, even for minor offenses such as jay-walking.
Enter California, a border state that is home to the largest number of illegal immigrants, most of whom are Hispanic, and is considerably more liberal than its neighbor Arizona.
A bill currently working its way through the California legislature would block local law enforcement from referring a detainee to immigration officials for deportation unless that person has been convicted of a violent or serious felony.
When California collapses, it will be the end of socialism. Don’t hold your breath. The feds will kick the can down the road
bail California out with taxpayer money, and that means mostly red state types.Happy 4th all! I’ll be spending the next few days picking raspberries, windsurfing the Gorge, cycling the hills and valleys, and wondering if house prices in Portland will ever cease to be stupid. Cheers!
“… windsurfing the Gorge …”
Ah, windsurfing … there is nothing quite like it.
But after a while one gets tired of chasing the wind because after a while one eventually becomes a wind snob in that if the wind is not really blowing hard then he won’t bother to rig up and head out. But the wind doesn’t blow all that hard all that often except in a few places … such as The Gorge.
I’ve run into people that have moved to The Gorge just because of the wind.
Indeed, however, the pact I’ve made with myself is to NEVER chase the wind. If it ain’t blowing, out comes the bike or kayak.
Chasing the wind:
Some guys I knew, in my windsurfing days, had their home computers programmed to page their pagers when the wind in selected areas reach a certain velocity. I’ve seen them de-rig from a 15 knot Cabrillo Beach wind and pack up their boards and sails and stuff to go to Seal Beach and rig up again because their pagers told them the wind there reached 20 knots-or-so. It’s rare but I’ve seen it happen - was there when it happened.
A related topic:
If you windsurf then you must know about cavitation and spin-outs.
There is a phenom called “supercavitation” (wiki-up the word) and there exists a Russian torpedo designed to utilize supercavitation to get itself up to a speed of 200 knots.
Wiki-up “shkval” to read about the torpedo.
Socialism works!
Next - pass a law to make French businesses profitable so they can pay more taxes.
FYI - President Francois Hollande is also going to hike the top marginal tax rate at 75% and hike surcharges on banks and energy companies.
Ok - bets and predictions. I give it 18 months before France implodes with 15-20% unemployment.
——————————-
France eyes layoffs clampdown as unemployment climbs
Reuters | Jun 7, 2012 | Leigh Thomas
France’s new Socialist government is planning to ramp up the cost of laying off workers for companies in the coming months, its labour minister said on Thursday after data showed the jobless rate hit the highest level this century at 10 percent.
The push to make firing more difficult in France, where making layoffs is already tightly regulated and often costly for employers, contrasts with moves under way in other euro zone countries such as Italy and Spain to make job cuts easier.
I wonder if Warren Buffet will next volunteer to move to France so that he can be taxed at 75%.
I would not hold my breath. Nor for Bono of U2.
Posted: 6:00 a.m. Tuesday, June 26, 2012
RealtyTrac crowns Vero Beach the best foreclosure beach buy in the nation
By Kimberly Miller
Palm Beach Post Staff Writer
Renowned for its quiet sandy shores and Orchid Island wealth, Vero Beach has earned a new designation _ the top beach town in the nation for buying foreclosures.
According to the market research firm RealtyTrac, Vero Beach foreclosures and short sales are the best beach-town bargains in the distressed property market, carrying an average discount of 45 percent from a traditional sale.
RealtyTrac ranked the top 10 beach towns in its June issue of the Foreclosure News Report, which was released Monday.
“We think we’re the top beach spot to live in anyway,” said Vero Beach City Manager Jim O’Connor, about the foreclosure designation. “What I’m being told is the foreclosure market is really decreasing and that the number of available units is just not there like it was at the peak.”
Ranked second on RealtyTrac’s beach report is Corpus Christi, Texas, followed by Naples, Fla., Santa Barbara, Calif. and Charleston, S.C.
How about crowning a Miss Short Sale or a Miss Foreclosure or how about Miss Deadbeat!
And here is your Miss Deadbeat for 2012, Lynn Szymoniak!
There she is, Miss Deadbeat
There she is, your ideal
The dreams of a million beats
Who are more than pretty (no doubt)
May come true in a BS court ruling
Oh she may turn out to be
The queen of femininity (sorry not this year)
There she is, Miss Deadbeat
There she is, your ideal
With so many Dedabeats
She`ll take the town by storm
With her all-American BS sob story
And there she is
Walking on air she is the
richest of the Deadbeats
she is Miss Deadbeat
The locals are shooting off fireworks like we just won some war or something. Oh yeah, they made it legal here to buy them finally. Parking lot for newly open fireworks store backed up yesterday. The governor paid them a visit too. BFD. Noisy as crap. Get off my lawn!!
Where is “here”?
Maine
In my part of New Tampa on the 4th there were people setting off fireworks in the parking lot between apartment buildings. I expected that. In my part of Los Angeles where more professional type of people live, so far so good at 9:15pm. Lots of fireworks activity at Santa Monica. Redondo Beach King Harbor was supposed to start at 9:30pm but I hear action there at 9:15. Had my digital camera with me on my balcony. ISO set to 100 and flash off. Action too far away. Oh well.
New Tampa a year ago.
Counter Offer came back “Best & Final”.
6 other offers as well (7 total including ours).
We’re taking a shot in the dark here, w/ our cash & close counter. (I disdain this blackhole called highest and best in a bidding war.)
Suck-ie!
How many got a counter?
How many were cash?
(Lender’s Appraiser could be a dream price deal breaker.)
It’s a rental (tenant living there). The lady owner lives in Tx.
We’re going a little higher, but as I said extortion is out. The place needs $50K put in.
Any feedback?
“(I disdain this blackhole called highest and best in a bidding war.)
..
Any feedback?”
Apparently, quite a few people are trying to buy at the moment. Perhaps this will die down once the collective realization hits that we are in the second leg down in a double-dip recession, and that this leg is global. Once this sinks in, the buyers will hide their money under the mattress again, and the bid wars will end.
Do I have some special powers of vision which let me see this when so many others seem blind and dumb to it?
Australia
Canada
China
Eurozone
France, Germany
Greece
BRICs
Korea
Nigeria
Spain
UK
US
Given the scepter of renewed recession on a global level, that most likely will knock out the all-cash foreign investors in U.S. real estate overnight, this seems like a terrible time to buy, but then I never claimed to be an “expert.”
Note that all these countries approaching recession at the same time implies the cumulative impact of the next leg down will be amplified, compared to a situation where some countries are booming and others recessing.
The other important point is that I am only discussing the reasons I think buying a home is a bad idea over the near term. Just last weekend, FPSS went through a primer on why U.S. housing is likely to be a bad long-term investment. I suggest anyone who missed this thread and is thinking of ever buying a home in the U.S. should review it.
Short summary: U.S. real estate is likely to perform poorly as an investment over the foreseeable future (e.g. next several decades).
+1
You might also get a lower interest rate or purchase price by delaying purchase for another eight months or so.
What do I like about July 4?
1. The Rancho Bernardo Independence Day Parade.
2. A sunny 70 degree temperature with a light breeze.
3. Barbequed sirloin burgers (90 percent lean).
My faith in mankind is restored now! (I’m easy…)
4th of July Activities
The Spirit of the Fourth Independence Day celebration in Rancho Bernardo will occur on Wednesday, July 4th, 2012.
2. A sunny 70 degree temperature with a light breeze.
Stop, bear. Would you please stop? I can feel it…
Just saw a news article that the British registered Company called GlaxoSmithKline ,( a big Pharma Company ) faces three billion in
penalities after pleading quilty to the biggest health care fraud in History .
“GSK admitted that psychicians had been bribed to push potentially
dangerous drugs in exchange for Madonna tickets ,Hawaiian vacations ,cash and lucrative speaking tours .”
” They also admitted distributing misleading information regarding the antidepressant Paxil.”
Anyway ,what does this remind you of ? Does this remind anybody of anything ? How about toxic loans that were pushed and all conceivable fraud that was committed that created a fraudulent housing bubble .
These people are willing to kill people for Madonna tickets ?
I think people are going to find that the DRUG business might be the
most corrupt and the drugs are toxic . This is even more intolerable than the housing debt fraud because in these cases thousands die .
Does anybody know that the FDA lets the drug companies do their own testing . Its not like a regulatory agency goes in and confirms their results ,they just take them on their word . Another recent case
in which a couple scientist whistleblowers that worked for a USA
Drug Company revealed that they produced false reports for the FDA
regarding a vaccine that they watered down for a cost saving measure .
You can find these articles on the internet ,they have broken in the last few days .
Wherever large amounts of public money are involved, such as the health care industry, one should also expect a certain level of venality to exist beneath the surface.
“…quilty…”
I know it was a typo, but it triggered a flood of memories about a book I read thirty-five years ago as an impressionable youth.
…
Lolita begs to be allowed to take part in the school play; Humbert reluctantly grants his permission in exchange for more sexual favors. The play is written by Clare Quilty. He is said to have attended a rehearsal and been impressed by Lolita’s acting. Just before opening night, Lolita and Humbert have a ferocious argument; Lolita runs away while Humbert assures the neighbors everything is fine. He searches frantically until he finds her exiting a phone booth. She is in a bright, pleasant mood, saying she tried to reach him at home and that a “great decision has been made.” They go to buy drinks and Lolita tells Humbert she doesn’t care about the play, rather, wants to leave town and resume their travels.
…
OPINION
July 4, 2012, 5:40 p.m. ET
John B. Taylor: Monetary Policy and the Next Crisis
Low interest rates and international capital flows, not a ’saving glut,’ were to blame for the 2008 crash.
By JOHN B. TAYLOR
At its annual meeting of the world’s central bankers in Switzerland last week, the Bank for International Settlements—the central bank of central banks—warned about the harmful “side effects” of current monetary policies “in the major advanced economies” where “policy rates remain very low and central bank balance sheets continue to expand.” These policies “have been fueling credit and asset price booms in some emerging economies,” the BIS reported, noting the “significant negative repercussions” unwinding these booms will have on advanced economies.
The BIS emphasizes the view that international capital flows stirred up by monetary policy were a primary factor leading to the preceding crisis and that these flows would lead to the next one. This is in stark contrast to the “global saving glut” hypothesis—which says that the funds pouring into the U.S. in the previous decade originated largely from the surplus of exports over imports in emerging market economies.
The BIS should be taken seriously. It warned long in advance about the monetary excesses that led to the financial crisis of 2008.
The capital-flow story starts during extended periods of low interest rates, as in the U.S. Federal Reserve’s low rates from 2003 to 2005 and its current near-zero interest rate policy, which began in 2008 and is expected to last to 2014. These low interest rates cause investors to search elsewhere for yield, and they buy foreign securities—corporate as well as sovereign—for that reason. Global bond funds in the U.S. thus shift their portfolios to these higher-yielding foreign securities and investors move to funds that specialize in such securities.
Low U.S. interest rates also encourage foreign firms to borrow in dollars rather than in local currency. U.S. branch offices of foreign banks play a key part in this process: As of 2009, U.S. branches of over 150 foreign banks had raised $645 billion to make loans in their home countries, making special use of U.S. money-market funds, where about one half of these funds’ assets are liabilities of foreign banks.
This increased flow of funds abroad—whether through direct securities purchases or through bank lending—puts upward pressure on the exchange rate in these countries, as the foreign firms sell their borrowed dollars and buy local currency to expand their operations and pay workers. That’s when foreign central banks enter the story. Concerned about the negative impact of the appreciating currency on their country’s exports or with the risky dollar borrowing of their firms, they respond in several ways.
First, they impose restrictions on their firms’ overseas borrowing or on foreigners investing in their country. But the differences in yield provide strong incentives for market participants to circumvent the restrictions.
Second, central banks buy dollar assets, including mortgage-backed securities and U.S. Treasurys, to keep the value of their local currency from rising too much as against the dollar. One consequence of these purchases is a foreign government-induced bubble in U.S. securities markets, as we saw in mortgage markets leading up to the recent crisis, and as we may now be seeing in U.S. Treasurys.
The flow of loans from the U.S. to foreign borrowers is effectively matched by a flow of funds by central banks back into the U.S. There is no change in the current account, and no role for the so-called savings glut.
Third, in order to discourage the inflow of funds seeking higher yields—which would drive up the exchange rate of their own currency—foreign central banks hold their interest rates lower than would be appropriate for domestic economic stability. There is much statistical evidence for this policy response, and, when you roam the halls of the BIS and talk to central bankers, as I did last week, you get even more convincing anecdotal evidence. Call it the lemming effect: Central banks tend to follow each other’s interest rates down.
This is what happened in the lead up to the 2008 financial crisis, and it has helped fuel Europe’s current debt crisis. In the 2003-2005 period, low interest rates led to a flow of funds into U.S. mortgage markets as foreign central banks bought dollars, aggravating the housing boom and the subsequent bust.
…
Draghi-King Push for Growth Raises Prospect of Zero Rates
By Simon Kennedy - Jul 4, 2012 4:00 PM PT
The European Central Bank and the Bank of England may drive global monetary policy deeper into the world of zero interest rates and unorthodox methods today as they seek to stimulate their flagging economies.
The ECB will take its benchmark interest rate below 1 percent for the first time, cutting it by a quarter percentage point to a record low of 0.75 percent, and reduce its deposit rate to zero, according to a Bloomberg News survey of economists. The Bank of England will raise its target for bond purchases by 50 billion pounds ($78 billion) to 375 billion pounds, another survey shows.
The moves would push JPMorgan Chase & Co.’s average interest rate for developed economies to a crisis-era low of about 0.5 percent and add to the balance sheets of major central banks, which have already swelled 40 percent in five years of global financial turmoil. The jury is out on whether the monetary medicine will work or whether policy makers will be forced to deploy further measures.
“A big part of the world economy has become fairly stagnant and so central banks are in easing mode again,” said Joseph Lupton, a global economist at JPMorgan in New York. “We’re probably at the point of diminishing returns, but it can still be argued that it helps somewhat.”
…
These policies “have been fueling credit and asset price booms in some emerging economies,” the BIS reported
When did we first talk here about the bubbles that the Fed was blowing into emerging economies—2008 or 2009?
I’m glad the titans of finance at the BIS are finally figuring it out…
BUSINESS
Updated July 4, 2012, 11:16 p.m. ET
Rate Scandal Set to Spread
Former Barclays CEO Lambasted in Parliament as Other Banks Brace for Fallout
By DAVID ENRICH And SARA SCHAEFER MUÑOZ
U.K. lawmakers grilled former Barclays CEO Robert Diamond for three hours about what he knew about the rating-fixing scandal that led to his resignation earlier this week. Sara Schaefer Munoz watched his performance. Photo: Reuters
LONDON—A day after abruptly resigning amid a mushrooming scandal over interest-rate manipulation, former Barclays (BARC.LN -0.63%) PLC chief Robert Diamond on Wednesday was assailed by British lawmakers for the bank’s actions, in a preview of the scrutiny likely to lie ahead for other big lenders that are under investigation.
Barclays last week agreed to pay $453 million to settle U.S. and British authorities’ allegations that the British bank tried to manipulate the London interbank offered rate, or Libor, which is the benchmark for interest rates on trillions of dollars of loans to individuals and businesses around the world.
Barclays executives initially believed they could ride out any resulting fallout from the settlement and accompanying admission that Barclays had acted improperly. But by Tuesday, the scandal had prompted the resignations of Mr. Diamond, Barclays Chairman Marcus Agius and Chief Operating Officer Jerry del Missier, some of the British banking industry’s most prominent figures. No individuals were charged.
With British politicians on all sides calling for further investigations, Mr. Diamond faced hostile questions from a parliamentary committee. Lawmakers expressed skepticism about his claim that he wasn’t aware until recently of his subordinates’ improprieties.
“Either you were complicit, grossly negligent or incompetent,” John Mann, a Labour lawmaker, told Mr. Diamond.
After a pause, Mr. Diamond asked, “Is there a question?”
…
For how many more months to come is the general trend in the global stock market likely to be down?
July 5, 2012, 1:03 a.m. EDT
Asia stocks slip ahead of ECB meeting
By Virginia Harrison, MarketWatch
SYDNEY (MarketWatch) — Asia stocks fell in choppy trade Thursday, as investors remained cautious ahead to European Central Bank and Bank of England meetings expected to unveil more easing.
China’s Shanghai Composite (CN:000001 -1.39%) led regional losses with a 1.2% drop.
Japan’s Nikkei Stock Average (JP:100000018 -0.37%) and Hong Kong’s Hang Seng Index (HK:HSI -0.25%) each fell 0.3%, while Australia’s S&P/ASX 200 index (AU:XJO -0.12%) lost 0.2% and South Korea’s Kospi (KR:SEU -0.03%) traded steady.
Asia markets took their lead from a weaker European session, with U.S. markets closed for a the July Fourth holiday.
…
For the last two years international stock indices have been flat. However, Europe is more into austerity and America’s austerity will begin officially in January. So I think it is a good idea to increase allocation internationally and decrease American holdings, while buying up T-Bills and two year notes.
Why would anyone save a greater fool think that now is a good time to buy real estate?
Asian Stocks, Oil Drop on Signs Europe Slump Is Worsening
By Glenys Sim and Jonathan Burgos - Jul 4, 2012 10:42 PM PT
Asian stocks retreated from an eight- week high, Australia’s dollar weakened and crude oil dropped before the European Central Bank meets to review interest rates and Spain sells debt.
The MSCI Asia Pacific Index slid 0.4 percent as of 2:33 p.m. in Tokyo, while futures on the Standard & Poor’s 500 Index declined 0.3 percent. The so-called Aussie fell against 15 of 16 major peers and oil lost 1 percent in New York, where markets were closed yesterday for a holiday. Treasuries gained before jobs data today and tomorrow. The Philippine peso rose toward a four-year high after a Standard & Poor’s upgrade.
A deteriorating outlook for the global economy is fueling speculation central banks will step up efforts to revive growth. The ECB will probably reduce its benchmark interest rate to a record-low 0.75 percent at a policy meeting today, while the Bank of England will step up bond purchases that boost the supply of pounds, according to Bloomberg surveys of economists. The Bank of Japan will use monetary policy to ensure financial stability, Governor Masaaki Shirakawa said.
“We need to see that economic growth globally, particularly in Europe and the U.S., is improving,” said Belinda Allen, a senior investment analyst at Colonial First State Global Asset Management in Sydney, which oversees about $145 billion. “Until then, markets will remain under pressure.”
…