Bits Bucket for July 24, 2012
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Ever notice how believing in Laissez Faire in financial matters [sound money, reduced regulation, no bailouts, etc] makes one a “conservative” but in social matters [gay marriage, legalization of drugs, etc] it makes one a “liberal”?
if you like lables.
i consider my self a conservative and i am for gay marriage, for legalization of pot and anti-death penalty.
Welcome to the libertarian party. Conservative in financial matters, liberal in social policy.
The concept of conservative “economically and fiscally”, while being liberal “socially” is often a bag of oxymorons.
Being “conservative” simply means LESS GOVERNMENT, and more self-reliance. To the end of having LESS government, you need to spend less on massive government programs., i.e. spend on roads, defense, infrastructure (airport,rails, ports), and not on “social programs” like free food, free housing, free medical care.
It is essentially impossible to be “economically fiscal and socially liberal” if you support all those so-called government “safety-net”, i.e. early retirement programs.
If you are “conservative”, you would want the government OUT of all these things, because you want as little government as possible to maintain law and order and keep the infrastructure maintained. You would not be inclined to all the “save the children” government programs.
I guess that’s why the liberals all say conservatives want to kill the children, destroy the environment and lay waste to civilization.
Where does Social Security and Medicare fit in? My parents and in-laws would both describe themselves and VERY CONSERVATIVE, yet you better not even think of laying a finger on SS and MC.
So, basically, 85-90% of what government spends is on the programs my “very conservative” parents and grandparents think money should be spent on, and all the “stuff they want to slash” is like 10-15% of government spending.
“My parents and in-laws would both describe themselves and VERY CONSERVATIVE, yet you better not even think of laying a finger on SS and MC.”
Did they contribute to SS and MC?
If tour parents feel that way about SS and Medicare they’re either a
a) not very conservative
or
b) very conservative and bad at math
I’m not going to speak for any political parties; but, for me personally.
SS fits into the “get out life” category. Give me back the 15% that I put into the system and let me invest it myself. I see no need for SS in our society, but, also, no way to “wind it down” without terrible consequences.
Health care is a different story (for me). Frankly, as much as this may shock some on this blog, I’m very “government centric” when it comes to healthcare. I think that we should have fully socialized medicine (doctors work for the government). The alternative that we have now is a disaster, there’s no way I can see to have a 3rd party payer system like this and keep the costs in control. The bloat around the medical industry (particularly health insurance) is mind boggling. I view healthcare as a basic human right; to deny it to someone, or to bankrupt them because of it, seems wrong to me. Also, the current system is so bad, I’d be willing to try almost anything else. People here rail on about Canada “You’ll wait 6 months to see a specialist”.. Well, guess what.. I have one of those “gold plated” plans that everyone complains about. I STILL can’t get an appointment at a specialist to save my life. I suppose if I happened to know a Dr in the area that I needed, I could bribe them to put me at the top of the list. But, looking at our system as the “panacea” of access to good doctors?? I think that means you haven’t been sick/injured enough to really need doctors.
Overtaxed:
Williams, premier of Newfoundland and Labrador, apparently needed surgery on a leaky heart valve, a problem discovered when doctors detected a heart murmur. According to news accounts, he chose to have the surgery done in Florida, where he could take advantage of a minimally invasive through-the-armpit procedure that promised to leave no scar on his chest and would allow for a speedier recovery than the traditional sternum-cracking open-heart approach.
Many have viewed his choice as an indictment of Canada’s government-run health-care system and a sign that America’s health-care system remains superior.
Allowing his words to speak as loudly as his actions, Williams, who is said to be recovering in Miami from his surgery (which according to this story took longer than expected), had explained his decision simply: “This was my heart, my choice and my health.I did not sign away my right to get the best possible health care for myself when I entered politics,” Williams said.
When the rubber hits the road and it’s YOUR life on the line, Canucks don’t go to Ottawa or Montreal for surgery. They go to the eeeeevil US for the best care available.
When the rubber hits the road and it’s YOUR life on the line, Canucks don’t go to Ottawa or Montreal for surgery. They go to the eeeeevil US for the best care available.
Wrong again Smithers. Goofballs always drag out that story but it means sqat in the big picture. Of course evil USA is best at many things but many things does not equal averages. Canadians live longer than Americans, have lower infant mortality, Spent $4.000 per person yearly on healthcare and insure everyone while USA spends $7,800 a year per person on health-care and has 1/3 of our population with no healthcare or evil Smithers (joke) health coverage that doesn’t cover jack. And most Canadians like their system a lot:
Canadians strongly support the health system’s public rather than for-profit private basis, and a 2009 poll by Nanos Research found 86.2% of Canadians surveyed supported or strongly supported “public solutions to make our public health care stronger….A 2009 Harris/Decima poll found 82% of Canadians preferred their healthcare system to the one in the United States, more than ten times as many as the 8% stating a preference for a US-style health care system for Canada[9] while a Strategic Counsel survey in 2008 found 91% of Canadians preferring their healthcare system to that of the U.S. wiki
Mr:
I don’t claim to have a solution to the healthcare issue. All I would say; the current system is totally run amok. I’m sure that there are some people who get great care, but there’s so much waste, it boggles the mind to even think about it.
I have a persistent back issue, that occasionally requires me to go in for shots and painkillers (2-3X a year, at most). The last time I went in, my Dr told me I need a new MRI because he can’t prescribe 30 Vicodin anymore without a current film. So, I hobbled my way to the MRI clinic (4 days of unbearable pain later) and got a new film. Another few days, I go in to the Dr who gives me a script and sends me on my way (the film was exactly the same as last time, disc blown at L4/5).
The total cost to my insurance company for all this (2 visits + MRI) was close to 2K. Had I paid out of pocket, it would have been 5K (well, according to the statements). The net benefit to me was 0 (or negative, if you count the days I was hobbling around in agony unable to work). I realize that this is as much a drug insanity issue as a medical one, but those 2 things are closely related in our society. How many people see a Dr to get a script for something where they know exactly what they need/qty/etc (because they’ve had it many times before)? How much time is wasted on just this one tiny little part of medicine (forget all the other massive money/time wasters)?
This is a problem without a good solution. More access to drugs would help; every time I’ve been to the Dr over the past 5 years (with the exception of one time for a minor surgery) it was only to get drugs to help with one issue or another. I knew exactly what I needed when I walked in, just needed him to write the script, bill me a few hundred bucks, and send me on my way. But there are bigger issues as well, things that are much harder to fix than just this small little part of the medical problems in this country.
You make this so easy, Smiters. Why not try fact-checking before you blather?
As it turns out, the procedure Williams sought was not only available in Canada at at least seven facilities, (with as good and better result histories as the Florida location, btw), but according to the (Canadian) surgeons who wrote the “how-to-” manuel on minimally-invasive robotic mitral valve repair, it may not have been medically appropriate for him.
The surgicenter Williams chose is close to his Florida condominium and advertises heavily to young women with uncomplicated mitral anomalies and cosmetic concerns.
A recent survey published at the Society of Thoracic Surgeons meeting (Jan 2010) expressed some word of caution and showed it is not recommended for complex mitral valve repair and also that the rate of complication (strokes in particular in older patients) is significantly higher.
For every Canadian bigwig who hops the border for a boutique surgery, I’ll give you a thousand murkins who get their meds from Canada.
Next….
Sit down, Smithers!!
Diogenes - I think the ’socially liberal’ tag (in my mind at least) has less to do about save the kiddies-type programs, and more to do with keeping public policy out of personal matters (ie, laws against sodomy, laws against smoking pot, laws against whatever-someone-I-don’t-know-thinks-I -shouldn’t-be-doing-with-my-lady-bits, etc.)
Of course, terms are often twisted to suit the speaker, so there are a lot of people who think ’socially liberal’ means more than I think it means.
I’m looking forward to the Tucson HBB meetup, MissMouse. We have a lot in common re: how we view the world.
Let’s see if we can’t smoke out a few more Tucsonans. Barrio Brewing awaits us!
You all heard the lady - calling all HBB-ers from Southern AZ. Hell, we’ll even welcome folks from Phoenix!
You all heard the lady - calling all HBB-ers from Southern AZ. Hell, we’ll even welcome folks from Phoenix!
Hell yes we will! If you’re from Phoenix, or even Northern AZ like our beloved Ben Jones (hint-hint!), then come on down to our meetup.
We’ll even welcome visitors from other states. And even those from other countries.
So Overtaxed, you would applaud if a well-trained physician was jailed for opening a private practice. I know. You said you are government-centric when it comes to health care.
But there are no exceptions to what a libertarian is. The non-aggression theme has to be applied in ALL cases, otherwise it ain’t libertarian. You propose to enslave doctors.
Bill,
No, I would not intervene in the private health care market. I would provide another option (socialized) for people; if a Dr wanted to practice privately, that would be his/her prerogative, but there would be another choice for the vast majority of this country that does not involve private or 3rd party payment.
I don’t see it as “enslaving” doctors, I see it very much the way I see the people who work in a jail/prison right now. They would chose to work for the government because there’s not much available in the private sector. But I’d, in no way, require that people work exclusively for the government (much the same way that many off duty police officers work security details in their free time).
How do you get doctors to work for the government? Pay them a good wage, and make it easier to get “more doctors”. If we dissolved all the BS processes around medicine today (insurance being the monster in the room), we could afford to pay our government doctors very well; I’d anticipate something from 100-250K (salary) depending on their specialty and years of experience.
The other thing that I’d do to increase supply is offer a program where the government picks up the entire tab for medical school if a Dr pledges a certain number of years working for the government system (modeled after ROTC). I’d like to remove the risk for those going to medical school and make it easy for them to get into the system and start seeing patients.
I disagree with the legalization of drugs. I think there are as many self described libs as there are cons who would be fine with legalizing soft drugs.
Legalization of the Possession of drugs…not the sale….it still should be a felony to sell… we are in Afghanni to protect the poppy fields or else we would have kept the Taliban in power..
I’m going to let someone else take care of this one if anyone wants to take up the mantle.
Trying to educate dj is about as useful as trying to dig a grave with a feather. You might get there eventually, but you will damage something pretty and bore yourself to insanity in the process.
What is the point in legalizing the drugs if you don’t legalize selling them? All you do is give law abiding citizens a reason to line the pockets of criminals.
We have to take the profit out of it…its the profit motive which causes the violent crime. Grow your own….
Get your xanax from your doctor…
Cigarettes and alcohol kill many more people each year than illegal drugs.
Legal drugs also kill more.
Keeping sales illegal drives the profit into the stratosphere. Most people won’t grow and process it it, just like most people won’t take the time to brew beer or grow/cure tobacco.
It doesn’t matter what the law says. Somebody’s going to profit.
“Legal drugs also kill more.”
The Seattle Times had an article a while back about legally prescribed methadone killing low income folks with pain issues.
Legally prescribed painkillers taken by kids from their parents’ medicine cabinets are a significant problem in suburban Seattle schools.
For the gods’ (and Polly’s) sake, dj, the “afghani” (with one “n”) is the national currency (like our dollar), the people are knowns as “Afghans”, and the country is spelled “Afghanistan”.
Please have the courtesy to use your spell check?
ahansen…its all a joke….i’m just getting too cynical we couldn’t even get 1st dibs on Irqa’s oil, so we might as well give the afghans their country back and beg them to destroy the poppy fields and can we mine your country for rare earth metals…pretty please?
Maybe im just too frustrated of being bombarded everyday by the seriously stupid. We have no leaders, neither has said a damn thing that sparks an interest..
And when you respond to a job ad…they come back with an Illegal “internship” and of course the big OH thinks working for free is pretty cool.
Okay, dj, let’s try this again. An “afghan” is the multicolored crocheted blankey your Grandmother puts over her knees when she’s watching Judge Judy on TV. An Afghan (with an uppercase “A”), is a person who lives in Afghanistan.
It’s really not all that funny.
Ahhh whats a few thousand dead american soldiers anyway?
Where is the outrage? News Flash mariah carey a new judge on AI….we can all swoon over her.
EVERY social policy has a set of both costs, and benefits.
Our current drug policy has a set of costs and benefits.
Legalizing soft drugs will also have a set of costs and benefits.
Legalizing all drugs will have yet another set of costs and benefits.
The question should be NOT which policy has no costs, but which policy has the highest net benefits.
Legalizing drugs - immediately massively undermines all drug dealers, all drug cartels within a week. Costs: Much easier access to these drugs by the young and experimental, resulting in higher (how much) addiction and abuse rates.
Current policy: Encourage a hyper-violent shadow economy of cartels and drug dealers. Encourages militarization of police forces and less personal liberties.
My recommendation: Legalize possession of soft drugs, but keep the use illegal. This will undermine the cartels and dealers, which make money on distribution, but allow prosecution of those determined to be taking drugs, which will act as a deterrent to the young and impressionable/experimental, and thus suppress increased addiction/abuse rates.
Prohibition didn’t work in the 20’s…why would it work now??
“…self described libs as there are cons…”
Name calling becomes bigots.
P.S. “bigot” is not a name, it’s a description of a behavior pattern often on display by a certain few HBB posters…
Smithers, you are making your own exception to the non-aggression theme of libertarianism just like Overtaxed and his proposal to forbid doctors to practice privately. In essence, you guys are saying the non-aggression theme applies in all cases except the ones that are my pet peeves.
Not mine (Bill in Los Angeles), but “my” pet peeves, in your point of reference.
That is so true!!
How the heck have I not noticed that?
For the past 33 years yes.
http://lewrockwell.com/vance/vance279.html
I post the above link to remind HBBers with the memory shorter than the lifespan of the common house fly when I say this:
I am for a complete untaxed and unregulated market, pro choice, and this all includes legalization of all drugs and prostitution. I am an admirer of the works of the late Lysander Spooner and Harry Browne.
I agree. Anyone who wants to control my non-aggressive lifestyle, tax me, or forbids me of victimless crimes can go piss up a rope. They are statists why we need to protect our lives, loved ones, and property with guns.
Anyone who wants to… tax me,
If you choose to live and work in the monkey pack, you gotta pay the monkey pack dues.
‘Render unto Caesar what is Caesar’s’.
Ah, the first common house fly!
It does not mean Caesar is necessary. It is essentially a protection racket. Nothing more. Competing governments, as suggested in “The Market For Liberty” are not perfect, but would be a more humane approach and allow us far more of our individual rights, which we have regardless of whatever thugs in Washington deny.
If you ever find this tax free utopia, please let us know.
It sounds cool, but it would also be cool if by just saying “shazam” I could turn into a guy with superpowers. Curiously, both only occur in literature.
If we had no national defense, a whole slew of tinpot banana republic dictators would look at each other in stunned disbelief, then fall over themselves as they rushed towards DC to take over.
No, you say? Our militias would stop them? Any non-trivial human endeavor requires concerted effort. This concerted effort must be guided in some fashion. Which means there would need to be some kind of leadership of the resistance.
Look at Iraq and Afghanistan you say? A few camel herders with rusty bolt action rifles holding at bay the world’s largest military? Sure. Even they have organization. But look at their living standards and look at the casualties they take. I don’t want to have to live like that.
As a result, I’ll take walls and men (and women) guarding the walls.
Summary: We could create a commune within a peaceful, defended society, but we could not create a commune in the wild, among violent barbarians.
‘in the wild, among violent barbarians’
Are you referring to Canadians or Mexicans?
Los Angelenos.
‘in the wild, among violent barbarians’
Are you referring to Canadians or Mexicans?
Realtors.
Many developed countries would love to have us as a colony, if they thought they could get away with it (we may already be a de facto colony, serving as a mercantilist sink for China and other net exporters with protected markets). Between Emma Maersk class freighters and 747s, a great deal of people and materiel are, and could be, moved across the oceans.
Look at all the effort the world spends in the oil fields of the Middle East. No one would pay that region a second glance if our oil somehow had not gotten under their land. The US has lots of arable land and natural resources.
If Putin, for example, could lay a claim to a section of the US, he would. As would any number of others.
To answer your question… frankly, I’ve never fully dropped my suspicion of the Canadians. They’re up there, lurking. Waiting for their moment
One more note: “Power is the reward for the most ruthless.”
I’ve actually seen some of the narco-beheading videos that come out of Mexico and Central America. The people with the will to carry out those kinds of acts in pursuit of money and power will be the ones who rise to rule, if we abdicate.
That ruthlessness, combined with fearlessness, has always been the source of power and leadership from time immemorial. In many places around the world, that evolution of society ended with feudalism being the steady state. England was the first feudal state to evolve into a modern nation-state. Finally, we see the world as it is today.
Power is the reward for the most ruthless. Never forget it.
Especially when thinking of ways to set up a society.
“If we had no national defense, a whole slew of tinpot banana republic dictators would look at each other in stunned disbelief, then fall over themselves as they rushed towards DC to take over.
No, you say? Our militias would stop them? Any non-trivial human endeavor requires concerted effort. This concerted effort must be guided in some fashion. Which means there would need to be some kind of leadership of the resistance.”
This argument certainly applies 60-70 years ago. However, right in the middle of the 40’s, everything change dramatically with the explosion of the first atomic weapon. IMHO, the only defense any nation needs anymore from a “banana republic dictator” is a well fed stock on ICBMs. If we dissolved our entire armed forces tomorrow with the exception of our land based nuclear arsenal, do you really think that anyone out there would be crazy enough to try a coup of our government (especially from a banana republic)?
I think that a real disservice has been done to this country by the use of a “measured response” in the face of war. First off, we need to keep our noses out of places that don’t directly attack us (ie, Vietnam). But, for those who do (ie, Iraq/Afghanistan), do you think that they would have taken the steps to provoke us if they knew that our only possible response if threatened is total annihilation of their entire country (and with it, their entire way of life)?
I see this like a highly toxic snake; their only defense from a larger predator is to bite, if you mess with one, you’re going to die. We, currently, are like a mean snake without venom. We’ll bite the crap out of you, and it’s going to hurt like he**, but, you’ll live to fight another day.
You want another highly unpopular view? If we had used nuclear weapons in Vietnam, not only would more of our brave young men come home to their families, but, IMHO, we would have prevented most of the wars that followed it. We showed our unwillingness to use our trump card in that war, opening us up to aggression right up to the present day.
“Many developed countries would love to have us as a colony, if they thought they could get away with it (we may already be a de facto colony, … for China …).
Suppose China is exercising their Constitutionally protected “free speech” rights through buying American politicians and technocrats high up in the U.S. government?
Suppose they are snapping up U.S. real estate to gain a foothold here which they will eventually use to take control of us politically?
Suppose they plan to eventually tap up all of our environmentally protected oil reserves, once they have sufficient political clout, to keep things humming for their 1bn+ citizens back home?
Just wonderin’…
The Chinese were backing the North Vietnamese. They also had nukes and refused to use them. ISTM, they might have had a nuclear response if we had used them.
Common wisdom was that the reason we lost in Vietnam was due to the threat of Chinese involvement if NV had started to lose badly. We did not even use an all out conventional war. Perhaps the lesson of Korea was enough to give our leaders pause.
Um, Iraq/Afghanistan did NOT “attack us.”
SO, return to the economic policies that gave us the 7 major recessions and depressions of the 19th century that consumed more than 1/3rd of that century?
Unregulated boom and bust, widest wealth disparity in American history, people literally starving in the streets… Good times (for the few, and sucked for the vast majority).
‘Unregulated boom and bust, widest wealth disparity in American history, people literally starving in the streets’
You forgot dogs and cats, sleeping together.
Anyway, isn’t the global real estate mania a boom and bust? Isn’t the wealth gap here and now? Poverty is at a multi-decade high and yet obesity is, uh, widespread?
SO, let’sa just keep feeding the beast, that’s what you are saying. Oh, and we’ll all be eating gruel if we don’t.
You say that like I’m happy about the HUGE steps back toward unregulated capitalism that we’ve been taking for the last 40 years…..
I want to go back to the 1950s and 1960s, when we used trade tariffs to protect domestic manufacturing, when the top marginal rate was above 90% to prevent too much money pooling into too few hands, when we were not dependent on unsustainable debt growth and speculative bubbles to pretend that we still have a workable economy…
One person says we’ve only gone 75% of the way. I say, no, we need to go back. You use the current 75% of the way there, that is a brewing economic disaster, as some kind of proof that we do not need to go back?
Really?
True, Darrell.
In the 50’s and 60’s we had people literally starving in our streets. (Famously documented by “Life” magazine’s “Poverty in America issue.) That’s one why they started holding riots, and why the “War On Poverty” was initiated. Same thing happened in the 1920’s.
Obesity, as has been discussed here many times, is a common byproduct of poverty and malnutrition, and is often caused by the inaccessibility of fresh and wholesome foods or the means with which to procure, store, and prepare them.
Where does the Republican party platform come in on this issue?
ft dot com
July 24, 2012 7:39 pm
Hedge funds back gay marriage
By Matthew Garrahan in Los Angeles
A group of wealthy pro-Republican hedge fund managers is backing efforts to legalise same-sex marriage in four US states that will vote on the issue in November, as the party’s more socially liberal donors try to regain ground ceded to social conservatives.
The campaign to win same-sex ballots in Maine, Maryland, Minnesota and Washington has received financial support from Paul Singer, the hedge fund billionaire who is one of the party’s biggest donors, and Cliff Asness, the founder of AQR Capital Management.
Dan Loeb, the activist investor who recently shook up the management of Yahoo and Seth Klarman, the founder of Baupost, the private equity group, are also backing the campaign. The four men have donated money to Freedom to Marry, a non-profit group that aims to legalise same-sex marriage, and have also contributed to American Unity, a super-political action committee started by Mr Singer which will give financial support to Republican congressional candidates that back marriage equality.
Ken Mehlman, the head of public affairs at KKR, the private equity group – and the former chairman of the Republican National Committee – is also backing the same-sex marriage campaign.
“Supporting the right of adults to marry the person that they love is consistent with Republican and conservative principles,” Mr Mehlman told the Financial Times. With recent poll data showing a surge in support for same-sex marriage, the Republican party needed to stay relevant with voters, he added. “A party that ignores reality and demographic change is a party that loses a lot of elections and becomes less relevant.”
…
Relevancy.
If you have no values to start with, why even take a position on such things. What’s the next boundary anyway, incest or child marriages?
Dogs and cats living and breeding together in sin.
Blue:
Gay marriage has always been about 2 things …health issues you’re not going to spread Aids if you are faithful, and JOBS…the wedding industry is big and even a dj could use some extra gigs.
Best of many salient HBB comments I saw yesterday:
“When government starts meddling with who wins and loses, then it’s adding in a flavour of socialism.”
Sounds like an assumption that if the government meddles, it will favor the needy and least powerful. Facism is another possibility.
“…it will favor the needy and
leastmost powerful…”The more power a government has, the more the rich have to gain by influencing the government. What happens when (not if) the government finally assumes total power?
“…government of Wall Street, by Wall Street, and for Wall Street, shall not perish from this Earth.”
But don’t the rich also get what they want if the government “gets out of the way”?
“…it will favor the needy and least most powerful…”
so you expect that one that only favors the needy and least powerful will remain once they get their quote share of the pie? This do-gooder mind set drives me crazy. How about let’s set up a society where we show people how to get ahead by hard work and effort. I don’t mean this politically correct educational system that we have now that turns out useless robots at a high cost to the tax payer, I mean let’s set up a system of education that teaches kids and adults how to be successful and survive in our system. How about courses in the trades, how about money (what it is and how to use it to get ahead), how about unmasking commercialism (sheeple being sheared by buying things they don’t need and the need to shop, shop, shop), how about learning to balance a check book, save money, start a small business, etc.
Thank God the folks at Comedy Central can find the pearls of humor in this story.
Neil Barofsky’s “Bailout”: Tim Geithner Is Sweaty, Dismissive
Jul 17, 2012 12:26 PM by Mary Phillips-Sandy
Neil Barofsky, former Special Inspector General in charge of oversight of TARP, has written a juicy new book about the bailout and how it was handled–mishandled, rather, which is where the juicy parts come in.
We got an advance copy of Bailout: An Inside Account of How Washington Abandoned Main Street While Rescuing Wall Street, hitting shelves July 24. So what have we learned about the little (not little) bailout that could (or couldn’t)?
…
All they did was keep the corrupted financial systems casinos alive and saved the Culprits by the bailouts at the expense of Main Street ,with no accountability . The Bailouts were the biggest obstruction of Justice and due process acts in American History, in my opinion .The “Bailouts ” were the biggest Con job that I had ever witnessed .
All those people that were put in key positions at the time were the Culprits or Regulatory systems that had failed to do their job .
It all started with the Feds giving face value short term loans to the Culprits based on faulty paper and it advanced to unjustified bailouts .
I’m not saying that there wouldn’t of been a need for Bailouts ,but at least it could of been done in a fashion that wouldn’t of kept the corrupted systems alive and let the Culprits off the hook and the money could of gone to more justified compensation ,or more productive compensation .
Who can forget Hank Paulson with his aburd” FIRE, FIRE” ,give me the big gun of 700 billion and all his BS of the GOOD BANK /BAD BANK ,we need to rescue the Bad Bank .Why do we need to rescue the Bad Bank ,we need to get rid of the Bad Bank and any financial
system that is based on a casino mentality ?
Who can forget Hank Paulson with his aburd” FIRE, FIRE” ??
After a number of years going by and listening to a lot of opinions of really smart people who’s opinions I respect, I have come to the conclusion that Paulson was correct….Bailing out AIG and others while a large portion of the population got left with high unemployment and lower real wages is kind of sickening really but, the alternative it is argued would have been far, far worse…
scdave …Your entitled to your opinion ,but all they did was keep corrupt systems alive ,rather than dismantle them .
Just exactly what did they save ? AIG could of refused to pay on those bets they made that were based on securitites that were misrepresented .Letting the Culprits ( LIke Paulson ) choose who the winners and losers were going to be was a big mistake .
all they did was keep corrupt systems alive ,rather than dismantle them ??
You may in fact be right…All I am saying is a lot of very intelligent people that I have listened to and read have said that the alternative of letting the house of cards crash would have delivered far worse pain and suffering to masses of american people…
So, the corrupt ones get away again…Whats new about that…
The insurers were/are backed by our pension funds, our municipal, state, and federal bonds, savings accounts, mortgages, etc. More to the point, AIG was backed by China Bank– the savings of the Chinese people.
Stop and think just a moment what your life would be like without a paycheck, without the ability to transfer funds or cash a check, pay for your kid’s schools or your electricity. More to the point, imagine your mother without her pension or SS check, no credit, no Medicare, no transportation….
A little accountability would have been nice, though.
At the time it seemed the mighty had fallen; now the joke is on Main Street, who got left holding the bag (again!).
The Inside Job
Hank Paulson: Kneeling Before Pelosi
September 26, 2008
Oh, how the mighty have fallen: Treasury Secretary Hank Paulson reportedly kneeled before House Speaker Nancy Pelosi last night in a bid to keep her party on board with the bailout package—while the GOP chafes and grimaces—so it can get through Congress and onto the president’s desk before the credit markets seize up.
Actually, the Wall Street Journal’s report said that it was really “a moment of levity in a rough day,” rather than a display of humility.
…
To hold that Paulson up as a savior is a big joke . He was protecting his own ass in that he was a major player with the mortage backed loans and the high leverage game playing that they were all doing . Paulson would of been sued had everything unraveled the way due process and
contract law would of unraveled it . Its just a big joke that the cuplrits were responsible for the Bail Outs . Was it any wonder that the bailouts didn’t have any requirements or
accountability . The fact that he demanded immunity for any thing that he did was a sign of a person working on behalf of self interested parties ,including himself .
But of course they had to try to convince the public and Congress that their self-serving obstruction of justice bailouts were going to save Main Street.
“…the alternative it is argued would have been far, far worse…”
Ladies and gentlemen, behold the standard justification for every extraordinary policy measure ever adopted in the history of Western government.
Someone who’s being sweaty and dismissive is very insecure in his own right. And I think we HBB-ers know the reasons why.
Why Obama picked Geithner for Treasury is beyond me. Especially when people like Joseph Stiglitz were available.
Why Obama picked Geithner for Treasury is beyond me. Especially when people like Joseph Stiglitz were available……..
Because he is and has been a major player in the rigging of Wallstreet/Bankster take-overs for the past few decades. Geithner, supposedly, was the “ONLY” man who knew the system well enough to “save” it. That meant Save the Banksters.
OBAMA was Supported most largely by the Banksters, and while speaking out both sides of his mouth about Wallstreet vs. Mainstreet, has been an ardent supporter of the “system” that supported him.
That’s why.
“Geithner, supposedly, was the “ONLY” man who knew the system well enough to “save” it.”
So, if Geithner was hit by a bus in this middle of “saving” the system, we’d all be back to living in caves today?
The “one man” bias is a terrible thing to perpetrate in this society. There are a few jobs that, yes, only one man can do. Michael Jordan, Steven Hawking, and a few other notable names come to mind. But, for a job that’s an elected position? Come on, by nature of the job (elected by the public) you’re going to get a mix of more and less capable people in that role. The system has to be setup such that it can handle an idiot (Greenspan) running the show for a long time before anything breaks.
Lessons learned from the recent financial debacle:
1. Things don’t typically work out for the better in the real financial world except for a few 1%ers at the top of the heap.
2. What is best for the majority is typically undermined by the thievery of pigs at the top.
3. All U.S. political leaders pay homage to Christianity, but their real-politics mock its practices.
Same reason he picked Rick Warren to give the invocation at his inaugural when people like Jeremiah Wright were available.
N.Y. Fed quiet on Barclays’ admission of rigging Libor
View Photo Gallery — Know your investment banks: Europe’s ongoing debt crisis is causing stock prices to slide at investment banks around the world. Presented here are the top nine banks and how they have been performing since the 2008 U.S. financial crisis.
By Jia Lynn Yang and Danielle Douglas, Tuesday, July 24, 6:03 PM
Treasury Secretary Timothy F. Geithner has said that he sounded the alarm four years ago to regulators about problems with the benchmark interest rate known as Libor.
But Geithner, who was then head of the Federal Reserve Bank of New York, did not communicate in key meetings with top regulators that British bank Barclays had admitted to Fed staffers that it was rigging Libor, according to people familiar with the matter.
Instead, regulators at the Commodity Futures Trading Commission and the Justice Department worked largely without the Fed’s help to build a case against Barclays. That work has culminated in a massive scandal rocking the banking industry on both sides of the Atlantic.
As Geithner prepares to testify Wednesday morning on Capitol Hill, he returns to a familiar position as a lightning rod for critics on the left and the right who find fault in his work as a banking regulator before he joined the White House and as a bailout architect under President Obama.
He will face a key question from House and Senate members this week: Did he and others at the New York Fed, the country’s most powerful banking regulator, act urgently enough to stop fraud at Barclays and potentially other banks?
Geithner has said the New York Fed did everything in its power.
“We moved quite quickly to try to get the British to address it and make sure that we brought it to the attention of the full complement of U.S. regulatory agencies so that they could take a careful look at it, which they did,” Geithner said Monday night on Charlie Rose’s interview show. “And to their credit, they’ve done a pretty strong enforcement action right now, but there’s more work to do on this.”
…
Good thing U.S. housing is going up again, as it appears the whole Eurozone economy isn’t faring so well.
July 24, 2012, 4:15 a.m. EDT
Euro-zone July PMI unchanged at 46.4
By William L. Watts
FRANKFURT (MarketWatch) — The Markit preliminary composite purchasing managers index reading for the 17-nation euro zone was unchanged at 46.4 in July, signaling a sixth straight month of shrinking private-sector activity across the region. A reading of less than 50 indicates a contraction in activity. Economists surveyed by Dow Jones Newswires had forecast a reading of 46.5. The PMI for the manufacturing sector fell to a 37-month low of 44.1 from 45.1 in June, Markit said, while the services PMI rose to a four-month high of 47.6 from 47.1, but remained in contraction territory. Markit said the fall in output was spread across the euro zone, with German activity shrinking at the fastest pace in three years. “The flash PMI for July suggests the euro area downturn showed no signs of letting up at the start of the third quarter,” said Chris Williamson, chief economist at Markit.
We all need to let this current frenzy pass. Look outside, what do you see?
It appears to me that this was the right mix for a mini-bubble, but even with low interest rates, at some point prices must fall.
This latest round merely snapped up the last of the how-mucha-months in the $100-$300k range.
My follow-on thoughts:
1) Now that the $100K-$300K range as soaked up all of what used to be $300K+ demand, the $300K+ sellers will need to lower their asking prices if they ever want to sell.
2) Once those nice $300K+ homes start selling below $300K, the prices of what are currently selling for $300K will have to come down in order to sell.
3) All bets are off after interest rates start going up, they way they currently are in places like Spain and Italy.
2007 392k——2011 177k
2007 270k——2011 160k
Yes the middle will push the bottom down, if you are to beleive these numbers, how else could it end up. The higher one got progressively cheaper, the lower one bid up 15% to land at these prices
they way they currently are in places like Spain and Italy.
What is the difference between Spain and Italy and the US in terms of control of interest rate policy?
When you apply for a mortgage in the US, is the rate benchmarked to LIBOR, US Treasuries, or some State-based debt instrument and why would that matter?
The answer to both these questions will explain why the statement “All bets are off after interest rates start going up, they way they currently are in places like Spain and Italy.” is a misnomer.
Interest rates aren’t going up. In fact, they are going negative in some places. “Interest rates rising” gets thrown around quite a bit here, yet very few ever point out that after 20 years, Japan is still following ZIRP. 20 years…
The biggest debtors pretty much control interest rates. They aren’t raising them. The closest thing we’ve seen to market interest rates was when Buffet made some deals in 08.
This mini-round is part of the war on savers. Here in the Monterey area older people (late 50’s and up into their 70’s) are buying all cash because they are making nothing on their money market investments and are being sold a bill of goods about buying for cash and renting out the unit for a cash flow greater than leaving the money in investment accounts.Older people need stability in their thought processes, that is % of return that they feel they can count on.
They should have loaded up on savings bonds the last 20 years of their careers and buy ‘em periodically. EE bonds purchased before five years ago have a guaranteed 4% yield.
To safeguard against default, they should have loaded up on the Permanent Portfolio. It is something the late Harry Browne inspired. I think that is PRPFX.
Note buying government securities does not sanction the state. Voting sanctions the state.
Here in the Monterey area older people (late 50’s and up into their 70’s) are buying all cash because they are making nothing on their money market investments and are being sold a bill of goods about buying for cash and renting out the unit for a cash flow greater than leaving the money in investment accounts.
Same thing’s happening here in Tucson. A few months ago, I tried to do an mini-intervention on a 60-something friend who was all hot to buy a nearby house. As an investment.
I don’t know if I was successful. She’s kind of been avoiding me since then.
But I tried.
It’s downright frothy here in San Fran.
We were out of town for a few weeks. Saw this house listed 2 weeks ago, and then went to see it is person yesterday. Not a fancy neighborhood, sweet little house that we really liked. Would have worked for us, with PITI + maintenance $200 less than our rent. Listed for 468K.
Turns out it had 10 offers within a week, went pending at $550K.
You didn’t link to a house. It was a list of houses.
Sorry, here it is:
http://www.redfin.com/CA/San-Francisco/315-Naples-St-94112/home/1720489
One bathroom, five floors, four wimmins, $600K?! (Figure in commission and fees.
Yikes.
We all need to let this current frenzy pass.
It appears to me that this was the right mix for a mini-bubble, but even with low interest rates, at some point prices must fall.
I’m all for that, as long as it’s not another 8-10 year wait. (see discussion below about having a paid-off house before you retire)
The rest of the world is irrelevant if we can manage to get another house-flipping bubble launched here in the homeland. The US economy during the housing bubble historically would represent the high-water mark of American prosperity. Only problem was the whole thing was based on lies, scams, rip-offs, and organized deceipt. And we ate it up like hungry sharks and currently want nothing more than to return to those “levels”. What does that tell you about the priorities of our people. Nothing to be proud of that’s for sure.
houses and stocks are all you need to make it.
“houses and stocks are all you need to make it.”
You got that right but you forgot to add, first in first out!
the whole thing was based on lies, scams, rip-offs, and organized deceipt. And we ate it up like hungry sharks and currently want nothing more than to return to those “levels”. What does that tell you about the priorities of our people.
It tells me that the masses are thinking like the 1%. An unfortunate but not surprising development.
It tells me that the masses are thinking like the 1%. An unfortunate but not surprising development.
Sort of. In the same way a cargo cultist islander is thinking like an American just because he’s got runway building on his mind instead of gathering food the old fashioned way…
Who said it yesterday? “You can’t even trust people in this country to use their turn signals, let alone…”
don’t know who said it but that’s a good one!
“You can’t even trust people in this country to use their turn signals, let alone…”
You can’t even trust people in this country to use their turn signals.
I have a serious pet peeve about turn signals. That and idiot Californians that pass you on the right.
Pass on the right? Don’t drive in Houston. There, you HAVE to pass on the right because the morons in the fast lane are not even doing the speed limit. Everywhere.
I’ve never seen anything like.
If you’re being passed on the right, you need to get out of the passing lane. Being a speed limit vigilante (even if you’re running over the limit) only pisses people off, who go on to piss more people off, gradually turning the freeway into a murderous cauldron of rage.
Sure, you’re legally in the right, but when some nutjob you wound up ends up maiming somebody, you share some of the responsibility. You are not making the road safer, and you aren’t teaching anyone a lesson.
You’re preaching to the choir. You can never get left lane bandits to concede to anything. I’ve had conversations with a few people that admitted to being “that guy” and they just don’t care. In fact some of them kind of enjoy it.
You can never get left lane bandits to concede to anything. I’ve had conversations with a few people that admitted to being “that guy” and they just don’t care. In fact some of them kind of enjoy it.
I just love psychopaths behind the wheel.
I’ll claim that one from yesterday.
I’m amazed at how many people get on the highway doing 40 mph, don’t signal, and don’t look until the last possible second and then get p!ssed if you haven’t conceded to them or, deity forbid, if you use your horn to call out their stupidity.
(I drive a lot for work and I’ve given up trying to teach people. Neither leading by example nor calling people out seems to do much good.)
And yes, in my opinion it’s a great analogy for the way many, if not most, people lead their lives.
” if we can manage to get another house-flipping bubble launched here in the homeland. ”
This idea seems to be getting more and more currency. In the face of euro-pessimism, bad job, retail sales numbers—”at least there’s housing..”—yikes!
Which just goes to prove that there wasn’t enough pain. I’m honestly beginning to think, “What housing bust?”
And we ate it up like hungry sharks and currently want nothing more than to return to those “levels”. What does that tell you about the priorities of our people. Nothing to be proud of that’s for sure…..
Please leave me out of the Lumpenmasses of “our people”. I have been railing against all these things here and at home for decades. Does it matter?
No.
The “media” make up daily stories to focus the general public on non-existant enemies and divert attention with things like “idol”. I don’t go for any of it. I don’t even go in for the “sports” thing like some many others here.
I even resent the sports analogies by commentators concerning business, romance and wars.
I agree, most Americans are uninformed idiots.
Look whose in the White House.
And “our people” don’t vote for Ron Paul either. I do.
and I will in November because I can’t bring myself to vote for the other two douchbags.
I am taking an ANYBODY but Obama position, the president with the mystery history. I know he will go Nuclear with his appointments and Czars and executive orders if he gets another term in office. He should be sent back to “community organize Chicago. Rahm Emmanuel will be glad to have him back in town.
I, too, supported Ron Paul, in spite of the media criticisms, which have been continual for more than 20 years. Imagine, someone who would question the Bankster’s “Federal reserve system” of money printing and monopoly play?
However, I know Ron Paul cannot win. Voting for him is taking a vote away from Romney, who I will vote for, holding my nose and resentful of the Republican party for helping him along the way. We had other good candidates, but people are morons.
So, realistically, a vote for RonPaul is a vote for Obama.
Then I’m taking a vote away from f*cking Romney. If more people had real balls instead of just selling out like a bunch of pussies (like you), then and only then there might be a possible way out of this surreal craptastic reality.
+1 Liz. The “a vote for RP is a vote for BO” BS is a red-herring used (by many I know) to distract and rationalize one’s own Romney-guilt.
exactly, Liz.
Even the Wall Street Journal is pimping for housing these days. What is the world coming to anymore?
CAPITAL
Updated July 11, 2012, 7:51 p.m. ET
Housing Passes a Milestone
By DAVID WESSEL
The housing market has turned—at last.
The U.S. finally has moved beyond attention-grabbing predictions from housing “experts” that housing is bottoming. The numbers are now convincing.
Nearly seven years after the housing bubble burst, most indexes of house prices are bending up. “We finally saw some rising home prices,” S&P’s David Blitzer said a few weeks ago as he reported the first monthly increase in the slow-moving S&P/Case-Shiller house-price data after seven months of declines.
…
CLICK!
Happy days are here again, the appreciation fairy lives again…NOT. Certainly in many market segments in many areas, the bottom has been here for awhile. But with all the hidden inventory, future foreclosures and the like, the chance of a significant “rebound” in most markets is unlikely. The worst hit markets may rebound some, because they hit bottom HARD.
Has the blog dealt with “property Wars” tv show?
must be right up ben’s alley (or just down the road)?
the idiots get bailed out by Phoenix’s “fast rising” real estate market every time.
Phoenix is a game of hot potato. We will see who gets their hands burned this time, with the likely govt salve to lessen the pain.
“Get rich or die tryin’” slowly moves up the social classes as we settle lower and lower in the water…
Inflation has been between 2-3% the last year. If housing did rise .2%, the value still dropped 1.8% at the low end.
Even as stocks get hammered worldwide, the U.S. housing market has bottomed out and started going up again. So buy ten investment houses and celebrate!
July 24, 2012, 10:04 a.m. EDT
FHFA says home prices climb 0.8% in May
By Jeffry Bartash
WASHINGTON (MarketWatch) - Home prices climbed 0.8% on a seasonally adjusted basis in May, following a revised 0.7% increase in April, the Federal Housing Finance Agency said Tuesday. From May 2011 to May 2012, prices rose 3.7%, the agency said, although the index is still 17% below its all-time peak set in April 2007. The FHFA purchase-only index is based on transactions bought or guaranteed by Fannie Mae or Freddie Mac. Earlier Tuesday, the real-estate website Zillow said home prices rose 0.2% in the second quarter compared to one year ago, marking the first year-over-year increase since 2007. Zillow also said it believes the housing market hit bottom earlier in the year and is now on the rise.
Are the U.S. housing market and Wall Street decoupled now? Because I keep seeing stocks get hammered day-in, day-out, even as the news of a U.S. housing bottom is spin-recycled over and over again. Who’d've thunk Main Street housing would recover before Wall Street did?
Global jitters upend stocks
Investors plow through a deluge of quarterly results, but European sovereign worries have a bigger hand in calling the bearish morning tune on Wall Street.
The bubble burst in 2005????
OT..what do you think of Joe Paterno “losing” 111 of his Football Wins?
Is this political correctness run amok?
http://philadelphia.cbslocal.com/2012/07/23/penn-state-community-awaits-ncaa-decision-on-football-program/
I don’t give a rat’s tail about college football. It’s just a training program fro the NFL.
Seriously, Colo.
We’re taxed to support bs that has nothing whatsoever to do with higher education. If you go to a school for the sports team, or sit vigils with tears in your eyes because they’re removing a freaking statue of some disgraced ball coach, you don’t belong in college.
I don’t mind subsidizing academic/scholastic pursuits, but anything beyond intra-mural sports belongs in another venue. Televised interviews with barely-literate athlete “graduates” (see, for example, Shaquille O’neill’s crowing about his recent “PhD” in human resources from something called “Barry University”,) should tell us all we need to know about the cynicism of these institutions’ admissions policies.
No, but covering for pedophiles was something “run amok”. The rape part just made it worse.
“OT…what do you think of Joe Paterno “losing” 111 of his Football Wins?”
It seems patently wrong to collectively punish everyone connected to that program, including all the players who attended Penn State and contributed to those victories, for the misdeeds of a few. And it is a bit silly to pretend that changing what the NCAA says happened will change what actually happened — a bit like revisionist history under a totalitarian government.
Must be a full moon tonight. I agree fully with the Cantankerous One.
Hi Eddie. How is the Atlanta real estate market holding up these days?
Atlanta home values to fall in next year, report says
10:08 am July 24, 2012, by David Markiewicz
Home values in 69 of 157 U.S. markets are expected to rise in the next year, according to the Zillow Home Value Forecast, but Atlanta is not one of the fortunate cities projected to see a gain.
Zillow foresees a 1.6 percent decline in Atlanta home prices to June 2013. Nationally, home values are expected to appreciate by 1.1 percent over the next year, from June 2012 to June 2013.
Some markets are expected to take giant leaps. Phoenix would see a 9.9 percent gain, Miami-Fort Lauderdale 6.1 percent, and Riverside, Calif. 5.6 percent, Zillow said.
Only St. Louis, where a decrease of 2.6 percent is expected, and Baltimore, where a decline of 2.2 percent is projected, would see bigger drops in the next year in home values than Atlanta.
As Zillow notes, “The housing market’s recovery continues to show tremendous variation market by market.”
…
Your prediction of a 2% up market for today - did you want to specify S&P, DOw or some broader market index?
I’m still waiting, Smithers.
“I’m still waiting, Smithers.”
Oops…
My appologies. He did specify that it was the DOW.
Comment by Mr. Smithers
2012-07-23 07:17:11
How many times have we seen this movie?
Day 1: Europe fears cause market panic. All hell breaks loos
Day 2: ECB and/or Ben Bernanke announces some new plan. Dow up 300.
Day 5: New fears emerge in Europe dampening spirits on Wall St.
Prediction: Dow is up 2% tomorrow.
“Prediction: Dow is up 2% tomorrow.”
Wrong!
Dow Jones Industrial Average
Market closed 12,617.32
Change -104.14 -0.82%
Volume 131.53m
Jul 24, 2012, 4:30 p.m.
Previous close 12,721.46
And it is a bit silly to pretend that changing what the NCAA says happened will change what actually happened
Kind of like turning your degree back in when you can’t make your student loan payments?
Good one alpha….
But Paterno was 71 back in ‘98, was he just an old man and this was over his head, he was clueless??
he just an old man and this was over his head, he was clueless??
Ah, the Reagan defense.
But Paterno was 71 back in ‘98, was he just an old man and this was over his head, he was clueless??
I can remember my mother saying bad things about JoePa many years ago. And, mind you, Mom gave birth to a kid in Pittsburgh, Pennsylvania, and she’s lived in the Keystone State since the mid-1950s.
But that’s my mother. If she sees a person who’s getting much more adulation than he/she deserves, she calls ‘em out.
And that includes Saint Joseph of Happy Valley.
Love ya, Mom!
But Paterno was 71 back in ‘98, was he just an old man and this was over his head,
He was competent enough to run a collegiate football program, and was paid about 1 million a year to do the job.
“It seems patently wrong to collectively punish everyone connected to that program, including all the players who attended Penn State and contributed to those victories, for the misdeeds of a few.”
The ONLY blame here lies with the university. These are the consequences. That’s how it works.
And don’t think they aren’t trying to find some way to go after the university administrators as well.
And smart enough to negotiate a free loan.
And it is a bit silly to pretend that changing what the NCAA says happened will change what actually happened
Kind of like turning your degree back in when you can’t make your student loan payments?
How about a redo on all those confessions made to pedaphiliac priests?
“OT..what do you think of Joe Paterno “losing” 111 of his Football Wins?”
You can rewrite history for all the PC you want but that doesn’t change the facts. Are we going to rewrite the careers for all the players who played those 111 games. Where were was the moral policing when the events were occurring? The American way, after the fact let’s write a feel good white paper and enact new laws rather then enforce the laws on the books and encourage people to do the right thing. But wait, that means MSM participation and that doesn’t fit their agenda of tearing down America.
Where were was the moral policing when the events were occurring?
Keeping their yaps shut because they feared the power and prestige of the program, or helping to hide the abuse because they worried it would hurt the program.
That’s why they should have shut the whole program down for five years. This was a slap on the wrist.
That’s why they should have shut the whole program down for five years. This was a slap on the wrist.
I agree. And I’m a native Pennsylvanian who’s had more than just a little bit to do with Penn Staters.
I agree alpha …but why not just Stop Paterno’s pension?
You all think its wrong to kick a man when he’s down but when he’s dead too?
Comparing raping little boys to tarnishing the image of Joe Pa?
Steve…Can you show me he knew everything? I dont even care about football or penn state or Joe Pa
But It seems so bizarre to take away wins from a coach or manager. What will they do next.
Now if Joe Pa was taking the boys out to a strip joint and hired a few “ladies” after each win…then it would make sense….
Why not just cut his pension to say $40,000 so his wife doesn’t have to live in poverty?
If “Political Correctness” is what you call slapping down a guy who for years turned a blind eye to the buggering of little boys, then I guess it is.
Call it what you want. It needed doing.
WF REO fees on a major fixer we passed on yesterday were $195 + $12,000 for the privledge of buying a home that was in foreclosure for 7 yrs.Thrashed =free stay 7 yrs. We passed mostly do to soil conditions. House easily needed $80K-$100K sunk in.
$12K? WTH
Ben-Heard this is a trial business model. Have you heard about this?
Could you explain a little more? Are those application fees?
Hi Turkey
Saw this REO come up on the MLS. Some mexicans were cleaning it up due to the city’s fines. They let us in. What a freak’n mess, but great bones. The caveat is soil conditions. It wasn’t acceptable to us.
Anyway, we look into it, and read the requirements and fees to buy the joint. We’re cash and would still have to pay the $12,000 and the $195. It was a blind auction, where you put in your offer online. We were told it was a new pilot program REO FEEs.
My take is that they love this lack of inventory and are creative enough to make more money off us poor suckers in fees.
Turkey-
Only if your bid is picked. We were advised not to give them a dime until we got the house inspected. They had some creepy “you’re screwed” and we get to keep some money clause.
NEVER do a deal like that.
Application fees are bullcrap. Bid fees are bullcrap. Rejection fees are bullcrap.
Run, don’t walk, away from deals like that.
Thank you, turkey lurkey, for showing all of us why the HBB is such a valuable resource!
turkey
We felt like Wells was extorting us buyers. $12,000 could have been the code violation balanced owed the city, or just because they arrogant pr*cks thought they had a captive customer. Thank you for confirming we did the right thing. Much appreciated.
(The added master was done without a permit. The city was all over that property, and that could me the cost of demolition for that no-permit room down the road.)
$10K here,$10K there…pretty soon you’re talking about real money. LOL Some flipper probably bought it. The auction closed last night. 1/2 the market price of the area w/ 3X’s the problems.The soil condition wasn’t fixable!
Deal breaker for us.
Future SIL told me he saw a new listing that said ‘house trashed, cash only’
Sounds like a place that might not even be able to get an occupancy certificate.
I’ve seen all kinds of things in the last month that we’ve been looking to buy a condo.
“Cash only”: This means they know they are asking way above the comps, it will never appraise for what they hope to get, so want someone with cash because otherwise the deal will crash when the appraisal comes in.
“Additional fees may apply”: Seller doesn’t want to pay the lawyer/Realtor/back HOA fees, etc.
“Not a short-sale”: Add 20% to the price now as you won’t have to wait 2-3 months to be told that you need to add 20% to the price or the bank will not approve the deal.
“Back on the market”: didn’t appraise for what the bank was willing to accept for the short-sale.
Darrell
Great decoding of the BS. The regular sales around here have a $10K premium right out of the gate.
“someone with cash because otherwise the deal will crash when the appraisal comes in. ”
I hope the appraisals are still market and not fantasy-hit the number types. Anyone know?
Why settle for a mere housing bubble for the masses. We need something with even more leverage this time around. What about a bubble where every American could qualify to buy his own Hospital, Insurance Company, or Bank? You know, something that has business subsidized by the Government and costs $billions to build. That would be incredible stimulus change we need.
That’s just crazy talk. You know those industries and special deals are reserved for our betters. You know, the jerb creators.
“Have you heard about this?”
Betcha the FHA has heard about it.
According to an article yesterday in WSJ , there is a reason I can’t seem to find any of those tough red plastic gas cans with the long spouts anymore.
A feral animal found in the USA , that sucks money instead of blood, (An American Lawyer), discovered that almost all those red gas containers were made in the USA by a single profitable small company . By looking around , they found folks burned by pouring gas on fires, etc. Lawsuits followed, claiming it was the gas can’s fault. The company went bankrupt in June , unable to deal with all the lawyers and lawsuits.
Guess we’ll have to go back to using empty 2-liter bottles and empty milk jugs to haul gasoline now.
maybe Shakespeare was right , suggesting to kill all the Lawyers.
How long of a spout? I just saw a shelf full in Home Despot yesterday. 1, 2.5, 5 gallon.
I hate the ones with the spout you have to pull out… covered in gas.
Who’s damn bright idea was that?!
The same mo-rons who wouldn’t put a wire mesh screen in the spout to prevent fuel vapor ignition, even though it was a known, cheap, and easy safety device.
Now they’re paying the price for their stupidity. Is that wrong?
Of course not! That’s just “personal responsibility”. How dare you suggest that companies not maximize their profits at our expense and safety.
There is a more important philosophical point here.
If you want to eliminate regulations (so as not to hurt the little guy who can’t compete with bigger companies when there are rules to follow or for any other reason), then you have to allow tort law suits to provide a financial motivation. Tort reform means keeping people from getting what a jury of their peers would grant them if they can prove they are hurt by their use of a product. If you prevent the law suits that are meant to give companies a financial motivation to make their products safe, then you have to put in regulations to keep the products safe.
Pick one or the other. You can’t have both. Or you can, but then you have people who don’t want to spend 4 hours doing internet research before buying anything getting hurt or killed by the products they buy.
There is an argument to be made that reducing regulation and allowing tort suits to do the work through the financial motive is better as it allows companies more flexibility in exactly how they make their products safe - rewards creativity and innovation. There is an argument that regulations are a better way to go on product safety because money doesn’t really fix being hurt and not everyone has good access to the legal system. Some combination of both on product saftey is where we are. Neither would be a disaster.
…except for the average person who is barely making median wage who cannot, and never will be able to, afford a lawsuit.
Class action? Don’t make me laugh. They give you COUPONS now if you win. COUPONS! If you’re lucky, maybe $100 cash. After several years of appeals, that is.
Great and very common example: Exxon Valdez disaster. 30 years later, each person affected that lived in the bay got $30,000. Yep, $1000 a year. Didn’t even pay their taxes on unemployment. The average loss was approx $100,000.
Lawsuits? HA!
Great and very common example: Exxon Valdez disaster. 30 years later, each person affected that lived in the bay got $30,000. Yep, $1000 a year. Didn’t even pay their taxes on unemployment. The average loss was approx $100,000.
Lawsuits? HA!
I just got a Google Adwords class action settlement check for $.04. Yup. Four cents.
Coupons…. the attorneys fees are based on the face value of the total coupons. The company pays the lawyers to go away and knows none of the coupons will ever come back for credit. $50 coupon requires you spend 3 hours labor to redeem and another $50 to buy $100 product to get the credit.
1,000,000 coupoons at $50 is $50,000,000, so the attorneys get 30% or $15,000,000 and you get a worthless coupon requiring you spend another $50 with the company to get a $50 credit…..
You are correct…a big scam
SEC sued BofA on my behalf. I filled out all sorts of paperwork for 2500 shares. It sounded like the SEC was going to settle for $10 a share, which seemed O.K.
I got a check for $34. It was not worth my time to pull out the brokerage statements and fill out the form.
Curiously, I made a good return on the stock, buying the last 500 shares at $3.50/share. but is was a harrowing ride, doubling down!
GM “Saddle gas tank settlement”
Millions in cash to the lawyers.
$1000 coupons to each truck owner, to purchase a new GM vehicle.
“I just got a Google Adwords class action settlement check for $.04. Yup. Four cents.”
this is how Edwards (slime that he is) got filthy rich
Those red plastic gas cans, as you point out, are poorly-designed POS. In addition to the spout-in-the-gas problem, and the no-vapor-barrier problem, they have two pour speeds: very very slow, and uncontrolled gush.
Jess,
It’s not just greedy lawyers. It’s also the enviro-nuts.
On Sunday I experienced what it now means to only have access to “environmentally friendly, save” gas cans. $17 for a 1.5 gallon can with 3 knobs that have to be unscrewed before actually allowing gas to pour out. Compare that to the old ones that were $5 for a 2.5 gallon with one twist off nozzle.
Ahhh progress!
Yeah Baby.. those enviro-nuts. Those CRAZIES that would like to stop and prevent pollution of our environment….. those NUTS! Who needs clean rivers, oceans, air, soil ANYWAY!!! Not my kids! Pollute Baby!!! It don’t matter!! USA-USA!!
Check out this can… it’s not cheap but it works:
VP Racing Square Jerry Can.
Yawn.
Typical knee jerk liberal reply. If you think enviro laws have gone overboard, it means you want brown rivers.
‘think enviro laws have gone overboard’ is not what you said.
You made a cheap, meaningless, derogatory remark sweeping all environmentally concerned on the pile of ‘nut jobs’.
‘knee jerk liberal reply’ …. there, you did it again.
You just make those meaningless, ‘catchy’ remarks hoping for an easy score. It’s lazy and shallow.
Words matter, try to articulate and think. Your comments will become so much more interesting and relevant.
I want a gas can that seals in vapors for storing gas for my mower, etc., since it is stored without adequate ventilation in a shed. Can’t find these in HomeDepot, Lowe’s etc. Time to go on-line.
A gas can should always have a small (open/close) vent so it doesn’t explode when the temp of the environment goes up and the gas starts to evaporate and creates pressure in the can.
Storing gas in a space without adequate ventilation is VERY dangerous!
Storing gas is pointless since the ethanol will absorb water.
The last couple of months I’ve been using up some E85 that had been stored for 5 years or so. I only use about a 20% mix but it hasn’t caused me any problems.
It looks to me like you got ripped off.
See Home Depot
I just bought a 5 gallon can on sale for 15. You throw one switch press the handle and poor. There are zero nobs and it seals much better than the older cans so my car doesn’t smell like gas when I fill the can up.
Do you have any idea where that quote comes from?
No, I thought not.
It is from Henry VI, Part II. A rebellion is brewing. A leader of the rebellion comes forward. He wants to overthrow the government. Wait, we can let him speak for himself.
Cade: Be brave, then; for your captain is brave, and vows reformation. There shall be in England seven halfpenny loaves sold for a penny, the three-hooped pot shall have ten hoops, and I will make it felony to drink small beer; all the realm shall be in common; and in Cheapside shall my palfrey go to grass; and when I am king, as king I will be, there shall be no money; all shall eat and drink on my score; and I will apparel them all in one livery, that they may agree like brothers and worship me their lord.
Dick: The first thing we do, let’s kill all the lawyers.
Cade: Nay, that I mean to do.
So, Cade wants to overthrow the English system which was hardly pure capitalism, but certainly leaned capitalist. In its stead he wants to make himself king and force merchants to give away food for less than it costs to make. He wants to make drinking one beverage a felony. He wants to do away with money and force all men to dress in uniforms. And, he wants to basically implement communism (all the realm in common). In order to do this, one of his followers suggests that he needs to do what? Yup. Kill the lawyers who would keep him from implementing his plan.
You want to withdraw your appeal to Shakespeare as an authority on this one?
You are on a roll today, Polly. Nice expositions both here and on torts vs regs. I learned something.
Mauldin’s recent “Outside The Box” newsletter (google it up for a complete read) presents a convincing argument that low returns on investsments will be with us for a VERY long while.
So … if this is true where will the trillions of dollars of promised money - money promised during those wonderful high return days -come from that are supposed to be forked over to pensioners and annuity holders and such?
No return = no money for those who were promised. No promised money means lots of people will have to do without which means spending will shrink.
Who cares? Certainly not the 1%! They got theirs!
Or should I say, they got YOURS.
And if you loved that, you’re going to love what they want to do to with privatizing Social Security!
They promised themselves. They’ll get it from younger generations who have “time to adjust” to even less.
I present to you three facts and two math equations, and minimal commentary for your evaluation:
1) Retirement age used to be 65, according to wikipedia the pitiful showing for the USA is 38th in the world for median lifespan at 78. So a median retirement would seem to be 13 years. Most used to start work at 18, but due to university and staggering tuition and very high youth un- and under- employment, lets assume you only get to save for retirement from 35 to 65. In summary you’ve got 30 earning years to save for 13 retirement years.
2) Repeatedly I’ve heard (sorry no cites but its all over the media and zerohedge and even here on the HBB) that the average american (who is that?) requires $2M net worth to retire over and above SS.
3) According to the huffpo as found by google the median individual annual wage (before taxes, I assume?) was $26364 in 2010. I assume its only dropped since then. The median income after real world inflation drops every year since roughly 1970 and I see no reason for the decline not to increase / accelerate, but we’ll very optimistically assume it’ll never decline every again. Ha ha.
My two equations:
1) $2M dollars / 13 years of retirement = $153K per year during retirement. This is for J6P who only made $26K per year while working. Or we can flip around the equation to be $2M / median pre-tax income of $26364 = 75 years of retirement at full income. Something not adding up here.
2) $2M dollars / $26364 median pre-tax earnings means if you put 100% of your pretax income into savings at 0% rate of return on savings and assuming the miracle of no capital losses (no investing in the stock market, no muni-bonds, etc, pretty much gold bars under the mattress), it’ll only take 76 years to accumulate $2M dollars. Unfortunately by starting saving at 35, an additional 76 years brings the retirement age up to 111. According to wikipedias “List_of_the_verified_oldest_people” 111 years of age just falls off the list of being one of the 100 oldest people in the entire world. So “less than a hundred americans can ever hope to retire”
I agree, those numbers are ridiculous and we do a disservice to others by even suggestion that “2M” is the magic number (as it seems, and for most is, totally unobtainable).
Also, 153K/yr seems a bit rich to me for retirement income?!? If you retire at 65, you should have your house paid off and have minimal (if any) other outstanding debt. As you begin to draw down your savings, you should also draw down a HELOC against the house, until, if timed perfectly, the day you die you owe exactly what the house is worth and you have 0 dollars in your bank account. IMHO, that’s the right way to look at retirement, the concept of “passing on” things like houses and retirement accounts is very “last generation”. Come in and go out with nothing, that’s the best thing for you, and frankly, probably also the best thing for your kids (should you choose to have them).
If you retire at 65, you should have your house paid off and have minimal (if any) other outstanding debt.
There are plenty of people my age (in their 40’s) who have been screwed by this housing bubble and have either remained renters or are back to renting again.
In fact, the only peers I know who have managed to buy homes have either inherited money (or a house) or work in tech or finance.
I had hoped to be able to have a paid-off home by the time I retire, but the way things are going is discouraging. Retiring as a renter is not appealing to me.
About the numbers: the median income stats float somewhere between 26k and 49K. News services have become adept at obscuring their sources and references. Unless your day job is research, it’s hard to find solid numbers. I try to use the IRS and Census as often as possible, but their 50 page reports make it hard when I’m pressed for time.
It would be safe to assume earning from age 24-65. However, the last 40 years have seen 5 recessions and many people incomes reduced each time they had to find a new job. Those that didn’t have to find new jobs, saw raises that did not keep up with inflation, either official or real. ( http://www.halfhill.com/inflation.html ) Each recession has resulted it longer and longer period of average unemployment per person. It was a good general rule of thumb just 30 years ago that 6 months worth of saving was enough to tide you over. This last recession saw 2 YEARS averages of unemployment. That’s enough to destroy 90% of the average person savings, along with the hit most of their 401K, bonds, stocks, etc, took.
The long and short of it is, most people can’t. Most people will be living in old age ghettos, getting abused by their children who will be blaming them for a lowered standard of living.
We are the richest country in the word with the stupidest population in the world. We have government, and society, we deserve.
‘We are the richest country’
After all, we have all those blank checks. There are something like $500,000 in govt liabilities for each of us. One could also say we are the poorest country.
‘We have government, and society, we deserve’
Maybe we should stop voting for liars?
‘Most of the 168 detainees at Guantanamo have been imprisoned by the U.S. Government for close to a decade without charges and with no end in sight to their captivity. Some now die at Guantanamo, thousands of miles away from their homes and families, without ever having had the chance to contest accusations of guilt. During the Bush years, the plight of these detainees was a major source of political controversy, but under Obama, it is now almost entirely forgotten. On those rare occasions when it is raised, Obama defenders invoke a blatant myth to shield the President from blame: he wanted and tried so very hard to end all of this, but Congress would not let him. Especially now that we’re in an Election Year, and in light of very recent developments, it’s long overdue to document clearly how misleading that excuse is.’
http://www.salon.com/2012/07/23/the_obama_gitmo_myth/
Love Greenwald. He is one of the very few consistent leftist writers out there. Rest are posers just like most leftists in this board.
‘posers just like most leftists in this board’
IMO left or right is a false dualism, but I get your point. I read lots of people go on rants about evil capitalists and 1%ers, as if that suffices for a critical examination of what’s going on. For some posters, as long as they jump in and cry ‘Ayn Rand!’ once or twice a week, they’ve done their progressive duty and will head down to vote for Obama this fall. This is part of the problem as I see it.
The ones screaming Ayn Rand, don’t understand that had it not been for govt actions, the eeeevil 1%ers coudln’t have done what they did.
It was govt that forced banks into lending to people who didn’t have a pot to piss in…all in the name of fairness and equality.
It was govt that reduced interest rates to practically 0%.
It was govt that encouraged (and still encourages) people to buy up as many houses as possible with all sorts of incentives, the biggest one of course being interest deduction. Every state has programs to assist people with down payments for a house. In Idaho if you make up to $70K a year, you can get some state money towards either a down payment or closing costs and lower interest rates on a loan.
Remember the $8K first time home buyer? Govt at its finest.
But yeah, let’s ignore that and scream eeeeeevil 1%!
‘It was govt that…’
What are we gonna do? One of the best things I heard an OWS person say was they weren’t going to fall for the two party dictatorship. That, IMO, is getting closer to the real problem.
How can we be in this situation so close to an election?
‘Sadly, no one is demanding more — especially the voters, who will ultimately decide Romney’s fate as a winner or two-time loser this fall. It doesn’t matter that his advisers have been moping about with nothing to do, or that fellow Republicans are beginning wonder why Romney is so ineffective at homing his message or differentiating his foreign policy positions from the president’s (clue: there’s hardly a blink of daylight between them).’
‘The emerging truth this summer is that the American public does not care. ‘“There is not a shred of intellectual serious intellectual debate in the U.S. media by the One Party system on the multiple problems spanning the whole ‘arc’ from North Africa to Middle East to East Asia,” writer Pepe Escobar shared with Antiwar.com. “It’s as if this was not a global empire — just a happy little island in the middle of the Pacific.’
http://original.antiwar.com/vlahos/2012/07/23/yawn-romney-goes-abroad/
“The ones screaming Ayn Rand, don’t understand that had it not been for govt actions, the eeeevil 1%ers coudln’t have done what they did. ”
If there are indeed people screaming that, they don’t understand Ayn Rand at all. I don’t agree with all her ideas, but, I can tell you, without a shadow of a doubt, that she would have thrown up on her shoes during the housing/banking collapse. What the government did is exactly the opposite of what Ayn’s philosophy suggests; it was crony capitalism at it’s finest, something she talks a whole lot about (and has characters who would appear to be the “1%s” with no “claim” to that income); she universally pans in throughout Atlas Shrugged (and her other books as well).
Ayn’s concept, for those who don’t care to read the 1100 page tome, is pretty simple. Hands off government. Very minimal services. Very minimal intrusion into private life. It’s similar to the libertarian party line (although, Ayn always was careful to distance herself from them). Bailing out the rich, I can assure you, was not part of her driving message in any of her books.
The voters no longer have any mechanism to put forward and promote the candidates they want.
Ask anyone who has seen how it works from the most basic public elected official election on up. The system is rigged from square one. Officially and unofficially.
Ayn’s concept, for those who don’t care to read the 1100 page tome, is pretty simple. Hands off government. Very minimal services. Very minimal intrusion into private life.
Surprise, surprise, she opted to accept Medicare when she was diagnosed with cancer.
had it not been for govt actions, the eeeevil 1%ers coudln’t have done what they did.
This is true. The Super rich have hijacked the government. But that doesn’t mean we still don’t need SocSec, Medicare, tariffs, regulation and a public option. You like to confuse issues and paint with a dogmatic brush. Either that or you are grossly ignorant.
It was govt that reduced interest rates to practically 0%.
It was the Fed who did that, which as we all know, is much more of a tool of the Evil Banks and Evil .01% than of our lobby bought evil government.
It was govt that forced banks into lending to people who didn’t have a pot to piss in…all in the name of fairness and equality.
Wrong again Smithers: It was private securitization enabled by deregulation that most fanned the flames.
Examining the big lie: How the facts of the economic crisis stack up
http://www.ritholtz.com/blog/2011/11/examining-the-big-lie-how-the-facts-of-the-economic-crisis-stack-up/
“…..The market share of financial institutions that were subject to the CRA has steadily declined since the legislation was passed in 1977. …accounted for only 28 percent of all mortgages originated in 2006.
•Nonbank mortgage underwriting exploded from 2001 to 2007, along with the private label securitization market, which eclipsed Fannie and Freddie during the boom.
Check the mortgage origination data: The vast majority of subprime mortgages — the loans at the heart of the global crisis — were underwritten by unregulated private firms. These were lenders who sold the bulk of their mortgages to Wall Street, not to Fannie or Freddie. Indeed, these firms had no deposits, so they were not under the jurisdiction of the Federal Deposit Insurance Corp or the Office of Thrift Supervision. The relative market share of Fannie Mae and Freddie Mac dropped from a high of 57 percent of all new mortgage originations in 2003, down to 37 percent as the bubble was developing in 2005-06.
“if the CRA was to blame, the housing boom would have been in CRA regions; it would have made places such as Harlem and South Philly and Compton and inner Washington the primary locales of the run up and collapse. Further, the default rates in these areas should have been worse than other regions….What occurred was the exact opposite: The suburbs boomed and busted and went into foreclosure in much greater numbers than inner cities. The tiny suburbs and exurbs of South Florida and California and Las Vegas and Arizona were the big boomtowns, not the low-income regions….
•Private lenders not subject to congressional regulations collapsed lending standards. Taking up that extra share were nonbanks selling mortgages elsewhere, not to the GSEs”
“It was govt that reduced interest rates to practically 0%.”
Certainly even Smithers is bright enough to realize the Fed is privately owned?
Court Rules Federal Reserve is Privately Owned
Case Reveals Fed’s Status as a Private Institution
“(clue: there’s hardly a blink of daylight between them)”
Romney and Obama are spending millions of buckaroos to convince us how different they are.
Why doesn’t Romney just offer to run as Obama’s VP, in exchange for the chance to be the president in 2016? Just think of how much money the 1% could save in campaign contributions if they worked out this deal?
Why doesn’t Romney just offer to run as Obama’s VP, in exchange for the chance to be the president in 2016?
Think of the collective audible pop as millions of righties’ heads exploded simultaneously.
“Think of the collective audible pop as millions of righties’ heads exploded simultaneously.”
All the more reason to hold out hope…
“posers just like most leftists in this board”
Perhaps the “leftists on this board” are not as far left as you think they are. From what I see, most Americans are capitalist at heart, including those branded as leftist by those to the right of them. And most folks are to the left on some issues and to the right on others.
Thanks for the reminder of the gitmo detainees.
wow 168 people. all caged up and no where to go.
And most of them are unfortunate bystanders. I am agnostic but I bet God keeps score of these types of injustice.
wow 168 people. all caged up and no where to go.
And most of them are unfortunate bystanders.
Now I’ve heard it all. You don’t get to Gitmo by being an “innocent bystander”.
The terrorists are not enemy combatants, the wear no uniforms, do not follow the Geneva Convention regarding the rules of war, and routinely attack civilians and use civilians as “human shields”. Why should we give them the rights affords Prisoners of War per the Geneva Convention? They took up arms against our country, killed our soldiers and our allies. They deserve no mercy.
And before all the bleeding heart have a melt-down regarding my statement above, do not forget that the recent killing of Israelis in a bomb attack by a terrorist in Bulgaria was done by a former inmate of Gitmo that was eventually released. Go explain how your bleeding hearts are for the poor Gitmo terrorists and not the dead Israelis, see how far that gets you.
Better yet, enlist in the military and learn what it means to risk your life for your country while ignorant liberal bleeding hearts root for the guys trying to kill you because we put them in jail instead of killing them outright…
‘You don’t get to Gitmo by’
Oh no, there are never mistakes when someone is arrested. Like when those bleeding hearts started running DNA tests and found innocent people on death row? Maybe you heard this one:
‘The Mexican government admitted it wrongly identified a detained man as the son of drug lord Joaquin “El Chapo” Guzman when showing him off to the media. The arrested man was (a) used car salesman’
http://www.upi.com/Top_News/World-News/2012/06/23/Mexico-shows-off-wrong-man-to-media/UPI-94821340457303/#ixzz21Z3KAv6j
Did you hear they used US ‘intelligence’ to nab this car salesman?
Here’s an idea! How about we have a meeting to decide if they are innocent. We could have legal guys and write everything down. And some impartial person could decide. We could call this a, a, trial. Yeah a trial.
“Why should we give them the rights affords Prisoners of War per the Geneva Convention? ”
I actually think we should give them the right to a trial because WE ARE AMERICANS. And, supposedly, that’s what this country is all about (or used to be).
If you make the choice to put someone in jail under your definition of rule of law, that person is entitled to a day in court. Anything else just starts chipping away at ALL our collective rights. Besides, if you’re so completely certain that they’re guilty, why are you afraid of an open trial?
And before you call me out as a bleeding heart/ communist/ pinko who wants to have Obama’s 1,000,000 babies… I also disagree 100% with Obama’s drone strikes (assassinations), as well as any other act that suspends habeas corpus - REGARDLESS of the political affiliation of the person ordering the act.
No trials…I think this is the future.
Even Stalin gave people trials.
enlist in the military and learn what it means to risk your life for your country while ignorant liberal bleeding hearts root for the guys trying to kill you because we put them in jail instead of killing them outright…
You are sounding more cartoonish and strawmanish every day. But that does sound rad when I read it with the Star Spangled Banner playing on my Chinese ipod.
You are sounding more cartoonish and strawmanish every day.
Strawman this…
Col. Jessep: Son, we live in a world that has walls, and those walls have to be guarded by men with guns. Who’s gonna do it? You? You, Lt. Weinburg? I have a greater responsibility than you could possibly fathom. You weep for Santiago, and you curse the Marines. You have that luxury. You have the luxury of not knowing what I know. That Santiago’s death, while tragic, probably saved lives. And my existence, while grotesque and incomprehensible to you, saves lives. You don’t want the truth because deep down in places you don’t talk about at parties, you want me on that wall, you need me on that wall. We use words like honor, code, loyalty. We use these words as the backbone of a life spent defending something. You use them as a punchline. I have neither the time nor the inclination to explain myself to a man who rises and sleeps under the blanket of the very freedom that I provide, and then questions the manner in which I provide it. I would rather you just said thank you, and went on your way, Otherwise, I suggest you pick up a weapon, and stand a post. Either way, I don’t give a damn what you think you are entitled to.
Strawman this…
You can’t handle the truth.
Nice!
‘The terrorists are not enemy combatants, the wear no uniforms, do not follow the Geneva Convention regarding the rules of war, and routinely attack civilians and use civilians as “human shields”. Why should we give them the rights affords Prisoners of War per the Geneva Convention?’
Who knows a priori who is a terrorist and who is an innocent man? This is what America’s constitutionally-protected due process of law is supposed to sort out.
The terrorists at Gitmo are not American citizens and thus not afforded the legal rights of an American citizen as stated in the Constitution.
Were they following the Geneva convention in regards to warfare, they would be afforded rights under that as prisoners of war. They do not. That is their choice: to wage a conflict against us in a manner not afforded by the Geneva convention.
Can mistakes happen? I’m sure. Mistakes happen in every conflict. Look at the innocent civilians killed in NATO airstrikes in Afghanistan. But to get to Gitmo, the CIA or military intelligence has to have some pretty significant intel on you, you had to be on their list of high-value targets, or you had to have been caught while actively fighting against the US…
Random people taken off the street in Kabul or Iraq don’t make it to Gitmo…
That was no myth.
http://en.wikipedia.org/wiki/Guantanamo_Bay_detention_camp#Obama.27s_2008_promise_to_close_the_camps
“lets assume you only get to save for retirement from 35 to 65.”
Let’s not. I got my first full time job at 22. I’ve been saving for retirement ever since, between 10-15% of my income every year.
Also you’re mixing up apples and oranges. The $2M is recommended for couples, your $26K is for an individual. So you have to double some of your numbers and halve some others.
$2M is not that much money to save by 2 people over the course of a 40 years career.
$2M is not that much money to save by 2 people over the course of a 40 years career.
Not if they’re both making 6 figures and the stock market generates decent returns over that time. Two big ifs.
Two people, each earning $50K a year and putting aside 10% towards savings every month can have $2.M after 40 years with a 6.5% return.
Even through the great depression you could have achieved a 6.5% (including reinvestment). Dow was at about 110 in 1920. It was just shy of 700 in 1960. Add in dividend reinvesting and you’re right around 6.5%.
Past performance is no guarantee of future returns. And it would appear that the conditions that made those returns possible aren’t coming back any time soon. And it’s going to be tough for them to save 10% if the REIC has anything to say about it. We need them to spend that money on housing right now.
Two people, each earing $50K when they retire, will not have been earning $50K per year at the beginning of their 40 years of savings.
Why don’t you tell us what percent of their income they would have to save if they each started out at $30K per year and got $500 a year raises for 40 years? Then explain how they are supposed to be able to save that much when they have a young family and are only taking in $65K a year.
You really this dumb or are you pretending so you can lie?
$2M is impossible if that couple is stuck working for $8 bucks an hour and no benefits.
“$2M is impossible if that couple is stuck working for $8 bucks an hour and no benefits.”
And if you’re making $16/hr combined working, you won’t need $2M to maintain that lifestyle while retired.
And BTW it is mainly a myth that people “live” on minimum wage. First off, only 5% of the entire working population earns minimum wage:
From BLS:
“In 2011, 73.9 million American workers age 16 and over were paid at hourly rates, representing 59.1 percent of all wage and salary workers.1 Among those paid by the hour, 1.7 million earned exactly the prevailing Federal minimum wage of $7.25 per hour. About 2.2 million had wages below the minimum.2 Together, these 3.8 million workers with wages at or below the Federal minimum made up 5.2 percent of all hourly-paid workers. ”
And of the 5%, this is the breakdown:
“Although workers under age 25 represented only about one-fifth of hourly-paid workers, they made up about half of those paid the Federal minimum wage or less. Among employed teenagers paid by the hour, about 23 percent earned the minimum wage or less, compared with about 3 percent of workers age 25 and over. “
The “family man trying to raise 2 kids on $7.25″ that liberals love to trot out when discussing these issues doesn’t exist. The vast majority of minimum wage workers are high school and college kids working part time.
Smithers, I only used the $8/hr figure based on your comment that all these unemployed folks should snatch up those sweet, sweet $8/hr Starbucks jobs. Keep up.
Reality isn’t much better at $12/hr than it is at $8.
“Smithers, I only used the $8/hr figure based on your comment that all these unemployed folks should snatch up those sweet, sweet $8/hr Starbucks jobs. Keep up.”
Why would they when the govt pays better to sit at home instead?
Nice duck and weave. Get back to us when you actually want to discuss the severe consequences of decades-long wage supression, and how that impacts retirement plans (or lack thereof).
Because in reality, the govt doesn’t.
Unemployment pay can vary from state to state, but it never lasts more than a year. 6 months is the average. And you can’t collect if you can’t show you looked for a certain minimum number of jobs… each week.
Once it runs out, you have to work for at least 2 years in most states, before you can qualify again.
Smithers, you had better never leave your ivory tower fantasy island. (de plane! de plane!) You will be eaten alive by reality.
“Unemployment pay can vary from state to state, but it never lasts more than a year.”
Uh-huh.
“The federal government added four tiers of federal extension benefits providing up to 53 weeks of additional benefits through the recession. The FED-ED extension added another up to 20 weeks of benefits. The grand total of up to 99 weeks was the potential maximum which will now come down to up to 79 weeks for qualified unemployed workers.”
Maybe you use different calendars than me but as far as I know, 79 weeks is more than a year.
I was on unemployment once. It was actually great timing as I wanted to quit anyway and my employer did me the favor. The requirements to look for a job were a joke. The requirement was make 3 contacts with potential employers per week. That means spend 5 minutes on monster or dice, send 3 emails for jobs you know you have no chance of getting….done and done.
And every week for my troubles I got $475 every week which works out to just about $12/hr. And it’s actually more than $12/hr since there is no FICA tax on unemployment which makes that $12 an hour the equivalent of $12.92.
So you tell me why anyone in their right mind would take the $12 hour job when he/she can stay home and make as much for up to 79 or 99 weeks?
People who make $12 an hour don’t get $475 a week. Unemployment is capped at about half of the salary you got when you “earned” your right to get it by being in a job where the employer had to pay unemployment insurance premiums with a hard cap somewhere between $400 and $500 a week depending on the state. A person who actually made $12 an hour would get less than $250 a week on unemployment.
You can have your own opinion. You can’t have your own facts.
And unemployment in AZ is already a total joke. Capped at $240 per week - regardless of how much you were making at the time of layoff.
If one looks at defined benefit plans you will notice that phantom income is part of one’s net worth. So, when money market 30 yrs bonds were paying 5% and your retirement was paying you $50K that is the same as having put away $1,000,000 in a bond account. In deflation the phantom income level increases and in inflation it decreases and that is why the savvy person opted to put extra money aside into a Roth or defined benefit plan. One cannot live off SS in CA without other assistance.
The $2 million is for people with $100K income before retirement and who don’t want to lower their lifestyle at all (like eating in more because they aren’t at work all day).
Because we are talking about people saving for their own retirement, you CAN’T assume death at the median age. When saving for retirement is done as an individual (not as a large population where statistics can be usefully applied), you have to save for the longest time you could possibly expect to live. If were still saving for retirement in large groups (pensions), we could use that median age as a guideline. Unless you are volunteering to kill yourself at the median age if you are still alive, the median age is irrelevant for an individual. The guidelines are assuming that you live to 95 or more.
BTW Polly, one interesting feature of the Simpson Bowles SS fix is that there would be an additional SS payment to people who are aged 85 or older (under the theory that they are more likely to have exhausted other sources).
I had a guy tell me that Simpson Bowles was step one to eliminating SS. He is prone to listening to liberal talking heads (Michael Moore, Rachel Maddow, etc.) and believing what they say…shocking that someone would twist Simpson Bowles–Obama’s own commission.
I guess they are trying to make some excuse as to why Obama didn’t vigorously pursue it…
I simply asked this guy if he had actually read the (Simpson-Bowles) plan…I got no answer.
Just a technicallity, but there was no plan from the S-B commission. The leaders of the group released their version, but the rules of the commission required 14 of 18 vote for it to be the official recommendation and they didn’t get that.
That’s right. They fell short, but they received a majority of the bi-partisan commission voting for the plan.
And there was tremendous detail presented to the public, and to my understanding, it was S-B that was the basis for the “gang of six” discussions.
It is the closest thing to a well thought-out bipartisan plan that we have.
And thusfar it has been largely ignored. Without any reason given so far…by either side.
Median lifespan is a misleading number. Why misleading? Because infant mortality rates drive the number down dramatically. As infant mortality fell, it automatically raises lifespan.
What you should look at is the median lifespan for someone who makes it to age 20. Different change in median lifespan, same issue.
You can’t look at the median at all. You are one person, not a large population of people. You might die before the median, at the median or after the median. What do you think you need to plan for? That’s right, as an individual you have to plan for the longest life you could possibly have and with the most expenses.
Meidans are for Social Security statisticians and pension analysts.
I am personally targeting a financial situation where my wife and I can live on the income generated from our retirement savings (where I don’t need to touch principal). I recognize this may be an unrealistic target, but like you said, I don’t know how long I’ll live.
First major flaw in your math is using life expectancy from birth (78 years). If you die from a childhood disease, retirement is not a big concern of yours. You should use life expectancy from 65. According to the SSA, life expectancy from age 65 is 17 for men and 20 for women.
The second major flaw is the $2 million figure. The $2 million assumes earning 5% interest and you needing $100K a year in retirement, and not touching the principal.
Or.. I suppose… 2% return and you needing $40K a year, without touching the principal.
How much would you need at .1% interest and needing $30K a year to supplement SS? $30 million?
Median household income is $50K. Assuming you were able to save 5% per year ($2500) and earn 2% above inflation (yeah, right), then at the end of 40 years you would have $154K.
Assuming you could continue to make 2% above inflation, and not touch principal, you would be earning $3K a year on your savings.
25% a year savings would increase this to $768K at the end of 40 years. 50% savings would net them $1.5M. They would have to save a full 66% off their income, for 40 years, and make a constant 2% above inflation, to have the equivalent of $2 million.
Of course, then, assuming 5% return, they would be making $100K a year in retirement, and had been living on $17.5K for the previous 40 years.
For the vast, vast, vast majority of households, the $2 million is no more realistic than telling them they should save $2 quadrillion.
$2 million is a marketing slogan targeted at those making more than $100K a year, to scare them into saving more. Realistically, unless your household income is above $100K, and you are able to save 30% or more (or you earn $150K and save 20%), then the $2 million figure is totally unreasonable.
My wife and I earn a combined $160K. Saving 5%, then getting a company match, bringing our total savings up to 10% of income, and adding in our current $100K in savings… over the next 20 years, assuming 2% above inflation rate of return (which we’ve not gotten since 2008) we would be lucky to have half a million dollars.
I won’t even mention how it is mathematically impossible for every entity in an economy to be accumulating money, without an equal amount of new debt being generated… Oops, I just did.
I am sure that Bill in LA will boast returns far in excess of 2% above inflation. I will counter by pointing out that is the DOW had hit 2% above inflation, every year for the last 40 years, it would be at 12,300. Oh, right where it is.
While it is possible for some to beat the average, it is impossible for all, and unlikely that a statistically significant number of people will beat it by a significant amount.
Thank you for doing the math, this is exactly what I was saying above, just with the math to back it up.
I particularly like the “just tell them to save a quadrillion, it’s about as realistic”.
My wife and I are both relatively young (early 30s) and have been maxing our 401Ks for a few years. IF (huge if) we are able to remain gainfully employed without large gaps for the next 20 years, it’s possible that we could have sums approaching that 2M dollar figure. But, that’s 2 people. Max 401Ks (and I get a ~50% match from my employer, so I can put in something around 22K/yr).
And, frankly, it’s almost certainly not going to be enough. Of course, we’d like to retire young, so that has a big impact on our planning. But, still, it’s kind of crazy to think about those numbers in relation to the American averages. I have no idea how most people are going to deal with the loss of the retirement safety net. All I can tell you, without a shadow of a doubt, is that it’s not going to be pretty.
I started putting money into a deferred comp plan in 1978 with no match and a maximum contribution of $5600 yearly. In 1997 I had a balance of $550K that was placed in a gov bond fund @ 5%.
That 8% return you got is nowhere to be found in today’s market.
When I got my first real job after all the years of training, I figured I would retire at 50. Wasn’t planning to have kids (and never changed my mind); bought a modest house; didn’t have any expensive hobbies (yet
). Time went by and I revised my retirement age to 53. Then 55. I am now 58 and not looking at retiring any time soon. Who knows, might even make it to 65 and still work, at least part time. So…moral of story: plans change. It’s hard to give up those golden handcuffs.
I started an IRA way back in the 1980’s . Always put money in 401K’s often not matched though, but always stock funds. At least 10% of salary for the last 10 years, I think 6% before that but I was getting the match at 50% of 6% to make 9%.
so I’m 51 and have about 200K this includes ROTH IRA not a 401K , total is not so great IMO
I’ve done better in “GASP” Real Estate
my 2 cents
to be clear
this total of ~200K includes ROTH IRA which is not a 401K but extra I added and is about 50K of the 200K.
So 150K of rollover IRA plus about 25k here in a 401K where I work now since 2010.
I think the problem with the math is that people at 65 are generally making there peak earnings, which are a lot more than the median income.
I watched The Man Nobody Knew last night. Pretty amazing film; like how the US blundered it’s way into Vietnam via assassination. But there was this statement about how Colby’s replacement was picked that caught my ear. And it has a housing bubble tie in too.
‘This film shows that when President Ford fired Colby after his truthful Congressional testimony and gave the job to Bush, Washington Post journalist Bob Woodward asked Ford why he picked Bush. Ford said, “I wanted a loyalist.” Woodward asked who are the “loyalists.” Ford replied, “Rumsfeld, Cheney, Kissinger, and Greenspan.”
http://www.tonymedley.com/2011/Man_Nobody_Knew_William_Colby.htm
I once worked for an organization where the loyalists were promoted right and left. To put it mildly, they weren’t the brightest and most competent people there. They were just…
…loyal.
Over time, the smart and competent found other things to do with their work lives.
Me, too. Mine was called the US Army.
My father had the same experience in the Naval Reserve. And, knowing my dad the way I do, he would have been more than happy to make a career there.
Oh yeah. The Bush, Rumsfeld, Cheney, Kissinger, Greenspan AND Rove connection goes way back.
What conspiracy?
Can someone explain to me how a government entity can get possession of a mortgage under eminent domain? And why it can’t just get possession of the real property and compensate the owner the fair value?
What are the eminent domain procedures in that state? That is what you have to do.
Why would they want to take the property by eminent domain? They are trying to get rid of the debt, not take over use of the property.
Chili-
I heard a Law Professor say that if they can tie the underwater mortgages to blithe, then they can take it by ED from the MBS investor, do a write down, and sell it to another investor, and it IS constitutional. I almost lost my lunch.
I’m not even sure if the government has to show that the property is blight, or a nuisance, or whatever, based on the Kelo decision.
It can take the real property. It only has to compensate the owner for its fair value. Who cares what the liens are? In any case, a municipal judge can decide that, in between the neighbors with the fence case and the dog bite case.
I can’t wrap my head around this “seize the mortgage” tactic. It smells like more FIRE theft.
I can’t wrap my head around this “seize the mortgage” tactic. It smells like more FIRE theft.
Matt Taibbi just said the same thing in Rolling Stone. Look out for the MRP.
I read the article and I get the impression he’s on board with this deal:
“What happened is, a bunch of us got together and asked ourselves what a fix of the housing/foreclosure problem would look like,” Gluckstern. “Then we asked, is there a way to fix it and make money, too. I mean, we’re businessmen. Obviously, if there wasn’t a financial motive for anybody, it wouldn’t happen.”
“Here’s how it works: MRP helps raise the capital a town or a county would need to essentially “buy” seized home loans from the banks and the bondholders (remember, to use eminent domain to seize property, governments must give the owners “reasonable compensation,” often interpreted as fair current market value).”
The fair current market value is for the HOUSE, not the loan.
The government has a financial motive to reduce costs of police, courts, prisons, probation officers etc, and to increase property tax revenues. There are city attorneys that are paid salaries, not commissions, to handle these transactions.
The fair market value of a non-recourse loan is always going to be in the general vicinity of the fair market value of the property securing it. Would you pay more than the value of the house for a non-recourse loan? But they aren’t seizing the house, just the loan.
“blight” sp checker blunder- thanks Chili.
Yeah, that FIRE theft thing scares the jeepers
out of me. Will it come down to pensions, our
individual investments, etc…
Where did my country go?
A NV realtor said that the state is
turning into a SFH rental state, and
few homes are available to buy as well. I was wondering
if that’s the future business model for the SFH market? My guess
is yes.
NV is one of the epicenters, and no homes to buy?
Will it come down to pensions, our
individual investments, etc…
Where did my country go?”
They will try to do this with inflation or making old money worth less than new money
companies can do this pre-IPO with down rounding exsisting stock and then giving great chunks out to NEW investors or employees. The first promises being too expensive.
How they will do it with real property ? taxes maybe ?
Thank you David Souter.
I just heard the DataQuick guy, Andrew LePage, discuss the decreasing San Diego foreclosure rate on NPR news. For some reason, he neglected to mention either the recent post-robosigning settlement nationwide uptick in foreclosures, or that California is currently the number one state for new foreclosure starts.
Even National Public Radio is a National Association of Realtors pimp these days. Give me objective reporting, or we will stop sending you our annual contributions.
July 12, 2012, 12:01 a.m. EDT
1 Million U.S. Properties With Foreclosure Filings in First Half of 2012 According to RealtyTrac Foreclosure Report
* Second Quarter Foreclosure Starts Increase Annually for First Time Since Q4 2009;
* California Foreclosure Starts Jump in June, Giving It Highest State Foreclosure Rate
IRVINE, CA, Jul 12, 2012
(MARKETWIRE via COMTEX) —
RealtyTrac(R) ( http://www.realtytrac.com ), the leading online marketplace for foreclosure properties, today released its Midyear 2012 Foreclosure Market Report, which shows a total of 1,045,801 U.S. properties with foreclosure filings — default notices, auction sale notices and bank repossessions — in the first half of 2012, a 2 percent increase from the previous six months but still down 11 percent from the first half of 2011.
…
High-level findings from the report
…
– Overall foreclosure activity in June decreased on a year-over-year basis for the 21st consecutive month, but foreclosure starts for the month increased annually for the second consecutive month.
– An 18 percent year-over-year increase in California foreclosure starts in June helped boost that state’s foreclosure rate to highest nationwide for the month. It was the first month California’s foreclosure rate ranked No. 1 since RealtyTrac began issuing its report in January 2005.
I follow foreclosures. Work-Outs (Mods) and BKs are delaying the process and with the new Ca HBOR were screwed. Kick the can down the road long enough to fall into the Jan 2013 time frame. We subscribe to a service. The BKs are viral.
Keep following those BKs Awaiting. They mainly get thrown out. We are aware of a group buying foreclosures, with the BK coming in at the last moment, which they need to deal with…with mainly a ~$1k legal bill and time, the BKs go away.
They are frequent, but they appear to go away quickly.
July 24, 2012, 12:02 a.m. EDT
Stocks get socked and cash is king
By Kevin Marder
Last week’s takeaway was the unwinding of a number of the cycle’s leading growth glamours — and the message this sends about the probability of successful speculation in the medium-term.
At the surface, the averages remain in up trends, as the below chart of the S&P 500 (SPX -0.63%) shows.
…
“At the surface, the averages remain in up trends, as the below chart of the S&P 500 (SPX -0.63%) shows.”
YTD S&P500 is up about over 6% with dividend reinvestment, annualized at 11.5%
How’s that compare to your Kingly Cash return?
Stock humpers are always throwing out a cherry picked range. Here’s a couple cherries for you: The last 5 years. The last 10 years.
You’re supposed to be in the stock market for the long term, right?
Last 10 years S&p500 return…using July 2002 to June 2012 as a measure.
Total Return: 50.02%
Annualized: 4.172%
Including dividend reinvestment:
Total Return: 82.21%
Annualized: 6.23%
Did you earn 6.23% interest on your KINGLY CASH over the past 10 years?
And it goes further than that as well. Any returns received as dividends were taxed at 15%. Any interest you made was taxed at your top ordinary income which is most likely above 15%.
So yes, over the long term (and I consider 10 years the long term) stocks have been better than cash.
“Did you earn 6.23% interest on your KINGLY CASH over the past 10 years?”
In hindsight, the place to be over the past decade was U.S. Treasurys (aka a level series of CASH payments over a fixed future period of time).
Got panic?
July 24, 2012, 5:01 p.m. ET
CREDIT MARKETS: Treasurys Soar, Issuers Undeterred as ‘Risk Off’ Continues
By Katy Burne
Investors rushed into U.S. Treasury debt for safety Tuesday, sending bond yields to record lows for a second-straight session as the risk-off trade rolled on.
Corporate issuers were undeterred, even as the CDX North America Investment Grade index–a measure of health in company bonds–weakened nearly 3% in late-afternoon trading versus Monday’s close, a bigger-than-average swoon.
FedEx Corp. (FDX) sold $1 billion in a two-part deal–its first U.S. debt offering in more than three years–while Norwegian oilfield-services company Schlumberger Ltd. (SLB) sold $2 billion of bonds.
The financing arm of U.S. conglomerate General Electric Co. (GE) and financial-services company BB&T Corp. (BBT) were selling preferred stock, seeking to boost their capital bases for regulatory purposes and disregarding the risk-off trade. Issuance of U.S. preferreds–which qualify as tier-one capital, a measure of banks’ health under new regulations–is at $17.1 billion so far this year, the most since the crisis in 2008 and up from $5.7 billion to this point last year, according to data provider Dealogic.
The latest jolt to investors’ sentiment, providing a strong bid for Treasurys, was a U.S. report showing a regional manufacturing index dropped to the lowest level in more than three years. A further blow came from increasing fears about the future of the euro zone. Worries continue to mount over the prospects that Spain may be forced to seek bailout for its sovereign and that Greece might not be able to service its debt.
As investors sold stocks and flocked to Treasury bonds, the benchmark 10-year note’s yield hit as low as 1.393%, breaking the 1.396% low set Monday. The 30-year bond’s yield touched 2.458%, also smashing through Monday’s 2.476% trough. Bond yields move inversely to their prices.
The U.S. government is a big winner as it continues to borrow cheaply to finance its large fiscal shortfall. The Treasury Department sold $35 billion two-year notes at a record-low yield of 0.22% Tuesday, a good start of this week’s $99 billion new notes supply. “Yields will keep grinding lower,” said Mike Donnelly, head of North American rates trading at TD Securities in New York.
Mr. Donnelly said he doesn’t see any catalysts in the near term to push yields much higher as there is “just so much ambiguity in the euro zone” that keeps investors nervous.
In late-afternoon trading, the benchmark 10-year note was 8/32 higher in price to yield 1.408%. The 30-year bond, the best-performing sector in the bond market, was 31/32 higher to yield 2.472%.
…
The stock market picture ever worsens.
ft dot com
Stock futures slide on Apple results
By Vivianne Rodrigues in New York
Tuesday 23:00 BST. Global equities are poised for further declines on Wednesday after Apple, the world’s largest company by market capitalisation, reported earnings well below the consensus of analysts’ forecasts.
The miss weighed heavily on S&P 500 and Nasdaq futures. Apple shares are down 5.1 per cent in extended trading. Also reporting worse-than-expected earnings was Netflix, the online movie group, which fell 14.5 per cent after releasing its quarterly earnings after the bell with a warning of a weaker outlook for upcoming quarters.
US Treasuries also hit a new low on Tuesday evening, with the yield on the 10-year note trading at 1.387 per cent.
Markets had already been under pressure for a third successive session as lingering concerns about the eurozone debt crisis caused borrowing costs in the region to rise further.
Riskier assets sold off throughout most of the day, with poor US economic data and corporate earnings forecasts overcoming the brief lift provided by signs of improvement in China’s manufacturing sector.
The S&P 500 extended declines and ended the session nearly 1 per cent lower, dragged lower by poorly received results and forecasts from UPS and Texas Instruments.
The FTSE All-World equity index, which lost about 3 per cent in the past two sessions, fell another 1 per cent, while the dollar index, a gauge of broader investor tension, is up 0.4 per cent.
The FTSE Eurofirst 300 lost 0.5 per cent, but the Asia-Pacific region all but stemmed its recent bloodletting with a dip of just 0.1 per cent.
The single currency also declined, touching a fresh two-year low at $1.2051 before closing trading at $1.2071, down 0.3 per cent on the day.
Investors remained very worried about eurozone fiscal woes, with their focus on the chances of Spain needing a bailout as its borrowing costs move to unsustainable levels.
Ten-year Spanish bond yields hit a fresh euro-era peak, up 12 basis points to 7.62 per cent. Rome’s borrowing costs were also elevated, adding 23bp to 6.56 per cent, as stocks in Milan have sold off to touch euro-era lows.
Madrid had to pay sharply higher rates to borrow for three and six months, just hours after news that Moody’s has revised to negative its outlook on Germany, the Netherlands and Luxembourg, citing the dangers of any fracturing of the euro bloc.
The move by the rating agency highlights the possibility of the eurozone sovereign debt crisis becoming ever more contagious and infecting the region’s “core”.
German Bunds are underperforming Treasuries markedly, with Bund yields up 6bp to 1.23 per cent.
In a sign of strong demand for Treasuries, the US government sold $35bn in two-year notes at record low yields.
“Record low yields have become less of an obstacle in the decision making process to buy Treasuries given the current difficult macro environment,” said Adrian Miller, a market strategist at GMP Securities.
…
So much for occupying Wall Street. Looks like the retail investors are deserting it in droves.
The race for the exits is ongoing.
Investors retreat from stock mutual funds in June
Source: Business News
Originally published: Jul 13, 2012 - 8:30 am
AP Personal Finance Writer
BOSTON (AP) - A rising market didn’t instill confidence last month, as investors continued to withdraw more from stock mutual funds than they deposited into them.
Investors withdrew a net $7.7 billion from U.S. stock funds in June, according to industry consultant Strategic Insight. It was the fourth consecutive month that money was pulled out of stock funds, and the biggest monthly total this year. Through June, net withdrawals total $15 billion.
The Standard & Poor’s 500 stock index rose about 4 percent in June, but the previous month’s 6 percent decline apparently was fresh in investors’ minds.
“Gains in the stock market have not emboldened investors, who worry about the ever-present risk of future losses,” said Avi Nachmany, research director with New York-based Strategic Insight.
…
like there was no bubble at all
13432 Bonita Heights StMoorpark, CA 93021 approved short sale fixer
June 2012 Sold: $321,000 Zestimate®: $368,300
1 month later
for sale July 2012 499,000
Address: 13432 Bonita Heights ST Tract Code:
Moorpark 93021
Public Remarks: Standard Sale. Don’t miss out on this remodeled and upgraded beauty in Rejada Ranch! Home features include a brand new kitchen with granite countertops, stainless steel appliances, tile backsplash and top of the line cabinets, recessed lighting throughout, updated bathrooms, finished garage, large yard with covered patio, new flooring, dual pane windows, no HOA and much more!
Home features include a brand new kitchen with granite countertops, stainless steel appliances, tile backsplash and top of the line cabinets, recessed lighting throughout, updated bathrooms, finished garage, large yard with covered patio, new flooring, dual pane windows, no HOA and much more!
This looks like a cosmetic flip. Meaning that it probably has older electrical wiring and plumbing. If those weren’t upgraded, the next owner will probably be in for some very interesting adventures.
This looks like a cosmetic flip. Meaning that it probably has older electrical wiring and plumbing. If those weren’t upgraded, the next owner will probably be in for some very interesting adventures.”
I agree thats exactly what it is probably start falling apart in a year or so
In addition to the possibility of problems in major systems like plumbing and electrical, a lot of these remodels-to-flip are poorly done. Not just in the workmanship, but in the selection of building materials.
“granite countertops, stainless steel”
Geeeezzzzz… Aren’t people sick of this crap yet?
True story - After my divorce, I refinanced and re-titled in my name only (NO cash-out, naturally). At some point I was talking to an appraiser on the phone, and describing all the improvements I’d made over the year: fixing old electric issues, fixing old plumbing issues, installing a new furnace, installing new windows, new gutters, rain cistern, graywater, etc., etc. etc.
After listening to this, he paused, and actually asked. “But, did you do anything else… like instaling granite countertops?”
A little piece of me died inside.
““granite countertops, stainless steel”
Geeeezzzzz… Aren’t people sick of this crap yet?”
You’re right. This is much nicer.
http://www.oneprojectcloser.com/wp-content/uploads/2008/09/kitchen_before.jpg
Slithers, is that YOUR kitchen?
Methinks you need to rip out that carpet and install tile. I mean, come on. Who puts carpeting in the kitchen?
Jesus Smithers. I will never again underestimate your capacity to completely, ridiculously and purposefully miss the point.
Jesus Smithers. I will never again underestimate your capacity to completely, ridiculously and purposefully miss the point.
MissMouseAZ, we have the same turn of mind. All the more reason for that HBB meetup at Barrio Brewing. I’m in. Let’s do it.
Ok ladies, so what is the “right” kitchen. It’s not granite, it’s not stainless steel, it’s not 70s vomit inducing colors. I’m curious to know what the appropriate decor is. My guess is nothing is appropriate for you, since everything is negative in your worlds.
Ok ladies, so what is the “right” kitchen. It’s not granite, it’s not stainless steel, it’s not 70s vomit inducing colors. I’m curious to know what the appropriate decor is. My guess is nothing is appropriate for you, since everything is negative in your worlds.
And you’re not exactly giving Dale Carnegie or Norman Vincent Peale a run for their money, Slitherman.
The point of the thread had to do with houses getting insanely overpriced due to cheap, cosmetic trickery - even if there were major structural or electrical flaws.
But since you asked the question about kitchens, IMO, granite/stainless is a boring, middle-of-the-road look that millions of happless homeowners were forced into adopting, due to spousal and/or societal pressure.
I know your world is an extremely black & white proposition, Smithers, but the ‘right kitchen’ is something clean, functional, and in keeping with the character of the home in which it resides.
And my world happens to be a very happy place. I just get a little pissy when my favorite blog gets hijacked by a partisan hack.
The right kitchen is one that happens to be in a house with good fundamentals and can be updated to the new owners satisfaction because they don’t have to worry about spending tens of thousands of dolars on a new roof, fixing the wiring, a new furnace, replacing leaking windows, etc.
The right realtor is one who knows how to sell a house that is well built and has had the important and expensive systems updated and isn’t so stupid that he/she can only understand the unimportant, trendy updates in the kitchen.
And my world happens to be a very happy place. I just get a little pissy when my favorite blog gets hijacked by a partisan hack.
And your fellow Tucsonan, Slim, has your back!
This looks like a cosmetic flip
We’ve seen so many of these. Just saw one yesterday, in fact. Laminate flooring in an older Victorian (no thanks). Spanking new stainless steel fridge and dishwasher, but wiring downstairs completely jury rigged.
We’ve seen some really awful flips, but I guess there are buyers out there who are easily fooled by a new coat of paint.
No need to guess. I can’t figure out how or why they ignored the inspector’s report. Assuming of course, they even got one. In which case, if they didn’t, then they deserve the screwing they get.
how soon the sheep forget.
Hey, dude, where are you in AZ? I’m down here in good ole Tucson.
Hey Slim!
Have you ever been to the Barrio Brewery down on 16th? It’s a pretty quick bike ride for me, and I suspect it might be for you too.
Besides us, are there any other HBB-ers in the Old Pueblo?
I sure do know about Barrio Brewing! Matter of fact, it’s a pretty quick bike ride away from…
…KXCI.
There are times when I really feel like quaffing a cold glass of Eff-It-All Lager after I’ve been on the air. Or after I’ve been practicing for a radio show. You see, I’m a bit of a perfectionist about this stuff.
So, ya wanna do the Barrio? I sure do!
As for other HBB-ers here in Tucson, let’s smoke ‘em out.
Trade The August 2012 FOMC Meeting - Buy VIX Calls
July 24, 2012
The markets lately have been behaving odd. On July 19, when there was a flood of bad macro-economic data, the S&P 500 Index (SPX) managed to actually move up! Among the bad economic data was a Spanish government bond auction that caused Spanish 10-year bond yield to move above the magical 7% mark—the yield at which Ireland, Greece and Portugal asked for a bailout.
Weekly jobless claims came in significantly worse at 386,000, compared with an expected consensus of 365,000. To top that off, existing home sales (which make up 80% of home sales in the U.S.) came in at 4.37 million versus a consensus number of 4.65 million. And if the above-depressive data hasn’t already made you liquidate your entire equity portfolio, on July 19, Philadelphia Fed Survey printed a number of -12.9, substantially lower than the consensus of -8.0, signaling more contraction in the mid-Atlantic manufacturing sector.
So what did the SPX do in light of all this gloom—it rallied! Curiously enough, gold (SPDR Gold Trust ETF: GLD) also rallied.
So why did the markets do so? They have put their faith in Helicopter Ben! The market is expecting the Federal Reserve (Fed) to launch another round of quantitative easing (QE3). Given QE involves the buying of treasuries by the Fed, is considered inflationary, and likely to promote growth, QE expectations cause the market to bid up treasuries, gold (as an inflation hedge) and the SPX. This is driving up the SPX and gold, despite such bad data.
The media is rife with speculation that QE3 could come as soon as the August 1 FOMC meeting. Also, starting May 2012, there has been strong correlation in the movements of 10-year treasury futures and SPX (Figure 1). Gold futures and SPX (Figure 2) have also been moving in lock-step since April 2012. Additionally, a recent Reuters poll suggests that 70% of the economists from 16 primary broker-dealers expect QE3 this year.
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Doesn’t the Fed pretty much face a choice between invoking QE3 next week and precipitating a stock market crash, due to unfulfilled Wall Street trader expectations?
Doesn’t the Fed pretty much face a choice between invoking QE3 next week and precipitating a stock market crash, due to unfulfilled Wall Street trader expectations?
”
yes I think the FED will blow another bubble and then we will get another big crash. Then and only then will voters see the FED needs to be over hauled or ended and money needs to be backed by hard assets. Then we will get deflation as needed but also stability. I give it another 10 years max
My guess is it will let it crash 30% or more before QE. There are only downsides to QE right now when Dow is already close to 13000. Fed will wait until the last moment and play god. Fed saves the world again has a nice ring to it.
Really?
When was the last time they let it go down by 30% or more?
That was rhetorical: The answer is October 2008 - March 2009. The real question is, would they allow that again, and why.
Politics, so close to election. Second, you don’t have to actually do it, the rumor of QE or twist is enough to get the markets roaring. Third, you can always blame Europe.
So the evil PTB allowed a 30% correction in 2008 which virtually guaranteed Obama’s election? But wait a second. The PTB then was run by eeeeevil Bush and his even more eeeeevil henchman Hank Paulson.
Are you saying Bush and Co. purposely allowed a crash to elect Obama? That’s like a conspiracy of conspiracies.
“So the evil PTB allowed a 30% correction in 2008 which virtually guaranteed Obama’s election?”
I agree with you that what happened in Fall 2008 is a bit mysterious. If QE was available in Fall 2008, why did they wait until March 2009 to play that card?
“I agree with you that what happened in Fall 2008 is a bit mysterious. If QE was available in Fall 2008, why did they wait until March 2009 to play that card?”
Hmmm. Could it be…and I know this is crazy talk….that nobody actually controls the market and instead it’s in the hands of the millions of individual investors each acting out in their own interest?
Nahh. Too crazy. Let’s go with the “3 guys in a room who set the DJIA every day” theory instead. Much more plausible.
“Nahh. Too crazy.”
Agreed. The Fed may not be able to completely control markets, but that won’t stop them from the attempt.
Apple misses earnings; Can QE3 be far behind?
By Jamie Coleman | July 24, 2012 at 20:34 GMT
Even Apple had a crappy quarter. Clearly the global economy is headed for collapse unless Ben Bernanke warms up his rescue chopper.
I’m only half-kidding.
July 24, 2012, 4:18 p.m. EDT
Fed moving closer to action: WSJ
By Greg Robb
WASHINGTON (MarketWatch) - Federal Reserve officials are moving closer to taking new action to try to spur the economy, according to a report Tuesday by the Wall Street Journal. Officials at the central bank are growing impatient with the sluggish growth and high unemployment and worried that growth is too slow. The report said that conversations inside the Fed had turned toward how and when to move but did not find a consensus for what steps the Fed might take at its meeting next week.
Doesn’t the Fed pretty much face a choice between invoking QE3 next week and precipitating a stock market crash, due to unfulfilled Wall Street trader expectations?
I guess we have no choice, then.
This arrived in my inbox the other day. Seemed interesting that Redfin is expressing outright doubt in this article.
July 19, 2012
Home Prices Up 3%, But When Will The Other Shoe Drop?
Here is Redfin’s monthly email newsletter, with a little about Redfin and a lot about what’s happening in the real estate market.
Ready for another roller-coaster ride through the U.S. real estate market? Home prices have for the moment been defying gravity, rising while the global economy sags. When will the other shoe drop? Not ’til September at least. By yesterday Redfin had booked as much 2012 revenue as we got all year in 2011. And weirdly for this late in the summer, new customers keep showing up at our door in greater numbers.
When Will the Other Shoe Drop?
But the U.S. economy is having another lions-tigers-and-bears moment, with jobs and consumer confidence in the tank, even as Goldman Sachs finally made its bottom call for real estate, five months late. In an interview last week, Warren Buffett said real estate had been holding the U.S. economy back for years, but now the situation is reversed.
“July 19, 2012
Home Prices Up 3%, But When Will The Other Shoe Drop?”
Here is a little conjecture: The stock market leads the labor market with a lag, and the labor market in turn leads the housing market with a lag.
Given that the U.S. stock market is currently retching and reeling like Linda Blair’s character in The Exorcist, I have to assume it is just a matter of time until U.S. housing sees its next leg down.
Question: Do you really think that the labor market ever got back to “normal” following the financial crisis? I don’t.
Conjecture: Given how extreme and recent the most recent downturn was, “normal” patterns will fail to emerge.
Wages remained permanently reduced on average, after each the last 5 recessions.
There’s an article about an alleged shortage of long haul truckers, 200K short.
http://money.cnn.com/2012/07/24/news/economy/trucking-jobs/index.htm
Funny how in our “free market” economy trucker wages aren’t rising to attract people to the trade.
Colorado,
This is text book free markets. The wage is low, nobody wants the job, especially with 99 weeks of employment available. Why is it funny? One of two things will happen. Wages will rise or trucking firms will figure out ways to run more efficiently with less labor. Given trucking is labor intensive the former is most likely. But there is the alternative of shipping goods by train if there is truly a shortage of truckers. One way or another the free market will solve this problem.
We’ve been hearing about “shortages” of people in my business since the 1970s.
Free market theory says wages will go up until the shortage is filled.
Reality is that business lobbies government to reduce training standards, offload training costs onto local governments, and allow foreign shops to work on US-registered aircraft.
they will let Mexican drivers drive trucks all over the 50 states isn’t that the free trade deal ?
They really don’t want to pay anymore not if they don’t have to. Besides it’s a burn out life I’ve been told.
FED EX or UPS thats who you want to drive for not independant trucking.
they will let Mexican drivers drive trucks all over the 50 states isn’t that the free trade deal ?
That is my guess as to what the end point will be.
‘Do you really think that the labor market ever got back to “normal” following the financial crisis?’
I certainly do not. What I do believe is that it will get worse again before it recovers to anything resembling normal.
The DOW has remained over 12,000 since Jan of this year. Up from 6600 in 2009.
Fortune 1000 companies are showing healthy and in many cases, record, profits.
Retching and reeling? More like churn and burn the same 500 pts over and over.
Every week, DC news radio interviews a pair of the top realtors in the DC area. Typically, it’s what you’d expect to hear from salespeople marketing their product.
However, this week, one of the realtors noted that he expects a large number of foreclosures to come on the market in September. I think he said it was a result of the robosigning settlement, but I’m not totally sure. I do clearly recall his opinion about the September foreclosures.
These guys are among the top real estate sales people in the DC metro area, and I’m confident they prepare for the weekly segment. Everything they say is in some way, designed to benefit their business. But, FYI.
NPR this morning had an interesting take on Boston Condo prices. They are now officially over the peak 2008 price.
I didn’t get all the details, so I can’t speak to sales volume, only the headline price.
Europe crisis could plunge the world into Great Depression II.
http://www.marketwatch.com/story/euro-crisis-brings-world-to-brink-of-depression-2012-07-24?dist=countdown
“The crisis has now gone well beyond the prospect of breaking up the euro to the threat of a full-fledged financial and economic collapse in Europe that could plunge the world into a second Great Depression.”
“Few Americans are aware that a worldwide banking crisis started by cascading bank failures in Austria and Germany was one of the major causes of that earlier Depression.”
“It was in the summer of 1931 that the collapse of Creditanstalt in Vienna forced one of Germany’s big banks, Danatbank, to fail, leading to a credit crisis that prompted bank holidays around the world and exacerbating an already severe economic crisis.”
The fact that we’ve had Great Depression II hanging over us for five years just shows that things are fundamentally unsound, with a large amount of unearned paper assets in the hands of a shrinking number of rich people, demographic issues, excess debt and consumption, and unfunded promises.
In other news, the Euro is now back down relative to the dollar to what it was when we took our one big trip to Italy several years ago. So if people don’t start shooting up theaters over there, perhaps we’ll go back.
There has never been a better time to own Treasurys!
ft dot com
Stocks falter as Spanish yields rise
By Vivianne Rodrigues in New York
Tuesday 18:45 BST. Markets are under pressure for a third successive session as lingering concerns about the eurozone debt crisis cause borrowing costs in the region to rise further.
Riskier assets are sliding further, with poor US economic data and corporate earnings forecasts overcoming the brief lift provided by signs of improvement in China’s manufacturing sector.
The FTSE All-World equity index, which lost about 3 per cent in the past two sessions, is down another 1 per cent, while the dollar index, a gauge of broader investor tension, is up 0.4 per cent.
The FTSE Eurofirst 300 lost 0.5 per cent, but the Asia-Pacific region all but stemmed its recent bloodletting with a dip of just 0.1 per cent.
On Wall Street, the S&P 500 extended declines and fell about 1 per cent, dragged lower by poorly received results and forecasts from UPS and Texas Instruments. One of the highlights of the US reporting season will take place after the closing bell when Apple releases its latest numbers.
The single currency has also declined, touching a fresh two-year low at $1.2051 and coming down 0.5 per cent on the day.
Investors remain very worried about eurozone fiscal woes, with their focus on the chances of Spain needing a bailout as its borrowing costs move to unsustainable levels.
Ten-year Spanish bond yields are at a fresh euro-era peak, up 12 basis points to 7.62 per cent. Rome’s borrowing costs are also elevated, adding 23bp to 6.56 per cent, as stocks in Milan have sold off to trade at euro-era lows.
Madrid had to pay sharply higher rates to borrow for three and six months, just hours after news that Moody’s has revised to negative its outlook on Germany, the Netherlands and Luxembourg, citing the dangers of any fracturing of the euro bloc.
The move by the rating agency highlights the possibility of the eurozone sovereign debt crisis becoming ever more contagious and infecting the region’s “core”.
German Bunds are underperforming Treasuries markedly. US benchmark yields are down 4bp to 1.40 per cent, reflecting the broader market’s risk aversion, while Bund yields are up 6bp to 1.23 per cent.
In a sign of strong demand for Treasuries, the US government sold $35bn in two-year notes at record low yields.
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I suggest U.S. home buyers ignore this dire prognostication and buy as many homes as possible as quickly as possible, while prices remain low. What happens in Europe, stays in Europe.
July 24, 2012, 11:25 a.m. EDT
Euro crisis brings world to brink of depression
Commentary: Parallels to 1930s’ missteps unmistakable
By Darrell Delamaide
WASHINGTON (MarketWatch) — Europe is a tinderbox waiting for a spark.
The financial volatility in Europe may have created a situation that is now beyond the capacity of policy makers to control or curb.
When an accomplished fixer like Pascal Lamy, the head of the World Trade Organization and the longtime chief of staff for former European Commission President Jacques Delors, describes the situation in Europe as “difficult, very difficult, very difficult, very difficult,” you know it is time to run for cover.
The crisis has now gone well beyond the prospect of breaking up the euro to the threat of a full-fledged financial and economic collapse in Europe that could plunge the world into a second Great Depression.
Few Americans are aware that a worldwide banking crisis started by cascading bank failures in Austria and Germany was one of the major causes of that earlier Depression.
It was in the summer of 1931 that the collapse of Creditanstalt in Vienna forced one of Germany’s big banks, Danatbank, to fail, leading to a credit crisis that prompted bank holidays around the world and exacerbating an already severe economic crisis.
The spark in the current crisis could come from a bank failure, and not necessarily in Spain. It could be a bank in Italy — or Austria, or Germany. German banks are notoriously undercapitalized and poorly supervised and have created a number of mini-crises in the past few decades since the collapse of the Herstatt Bank in 1974.
German economist Fabian Lindner drew the parallel to 1931 in an op-ed last fall when he compared his country’s intransigence toward southern Europe now to the misguided harshness of the U.S. and France toward Germany in the earlier crisis.
Spain has led headlines following its surging bond yields but investors who plunk money into a broad basket of Spanish shares today could see average returns of 20% a year over the next several years. Jack Hough discusses on Markets Hub. Photo: Reuters.
“Both the German public and politicians should learn from history,” Lindner wrote in a commentary for Die Zeit that was also published in The Guardian. “Solidarity with the crisis countries is in Germany’s long-run interest. The German government should stop abusing its power to dictate economic decline to other nations. The alternative is economic stagnation and increased tensions between European nations.”
The situation has deteriorated since Lindner hoped in vain for some enlightenment on the German side. Instead, German Chancellor Angela Merkel and Bundesbank President Jens Weidmann have held to the prescription Lindner saw leading to disaster: “Germany and the German central bankers demand drastic austerity and only give piecemeal and insufficient help in return — too little, too late.”
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Which for me is proving to be exactly zero.
There are no units that I am interest in on the market for more than 2 days at a time. I’m trapped between cash buyers bidding above appraisal value, my limited down payment of 25% on townhouses up to $50K, and the lower limit of what banks will even bother to write a mortgage for ($30K to $35K loan amount for most lenders).
If I find something for $35K, that appraises for $30K, well, I have the $12K down (25% of $30K + $5K over appraisal), but can’t get a mortgage for only $22.5K.
If I find something that appraises for $50K, but a cash buyer is willing to bid $55K… when then I’m the $5K overbid short on the down.
I need to hit a sweet spot of $47K-$50K and have it appraise for the offered price, to squeeze in the narrow range of my down payment and minimum mortgage amount.
Of course, I could just take out a personal loan for another $10K or so down, but I really want to avoid that.. or wait a couple months and add $1K a month to the down payment funds.
“If tour parents feel that way about SS and Medicare they’re either a
a) not very conservative
or
b) very conservative and bad at math”
My father is a literal genius, with an IQ in the 140 range, like me. After 8 years in the navy, we worked as a rocket scientist building spy satellites for the DoD. He is not bad at math. Therefore, I must assume, based on your argument, that he is not very conservative.
So, will Romney, the conservative candidate, be running on the platform of slashing SS and MC for my parents and Boomer in-laws?
Or, is Romney a liberal? Or is Romney just bad at math?
It is soooooo much easier to pretend that the majority of the $3.7T federal budget is welfare, fraud, waste and other liberal garbage than to honestly deal with the fact that the stuff that people like my dad really likes in the 2012 budget is:
$900B defense (DoD, VA, Homeland Security, Energy for nukes)
$650B SS
$200B military and other pensions
$400B Medicare
$85B Medicaid long-term care for seniors
$225B interest
$100B Transportation
$100B law, courts, prisons
Or about…. $2.7B… a bit over 70% of the budget they’d consider untouchable.
Stuff he’d like to see slashed up to 50% is stuff like:
Education $150B
Non-senior citizen Medicaid: $200B
Unemployment: $100B
Disability: $35B
General government: $30B
Call it $500B, or 13% of the budget… savings by slashing these 50% = $250B.
Then, there is the stuff he’d totally eliminate…
Food Stamps: $100B
EITC and per child tax credit: $72B
Housing assistance: $80B
Welfare (TANF, SCHIP, etc, etc…) $100B
everything else: $150B.
So, my father’s net savings, of everything he’d like to slash is about $750B. Which, of course, is all of 20% of government spending, or about 55% of the annual deficit.
Of course, he is convinced that slashing this $750B in spending would have only positive effects on the economy and tax receipts…. Because we can lower taxes by the same amount, and that will stimulate the economy and bring in more revenue… because lowering tax rates increases tax revenues, Laffer Curve….Obama is an Islamic Socialist, was born in Nigeria, and he wants to ban guns and turn every American male into a homosexual….
My dad seems “very conservative” to me. He spews EVERY Republican Party talking point….
I really, really, really hope Romney wins, and gets a Republican house and senate. Only after BOTH parties have fallen flat on their face attempting to restart the debt based economic model of embracing trade imbalances, can we take a step back and examine if embracing trade imbalances and funding them via unsustainable debt growth is really a viable long-term economic model….
History shows that of every empire that ever existed, very few “took a step back”, and of those that did it, only bought them a couple of centuries at most before they embraced their old ways.
Still, many lasted several millenia before they fell.
Over and over and over and over….
And that was before the Internet and airplanes.
“So, will Romney, the conservative candidate, be running on the platform of slashing SS and MC for my parents and Boomer in-laws? ”
This confirms it. You and your parents have no clue what the word conservative means.
Conservative means resistant to change…keep things are they are, or were. Many of my very (socially) conservative associates think of the 1950s as the modern “golden age” and seek a return to those ideals. Mom stays at home, no gays, simple, family-friendly entertainment. Of course the low taxes of today didn’t exist then, as they were much higher. And the country was filled then by a generation of war-weary vets eager to get to work at home and live a peaceful life after the worst war in world history. Also, the rest of the world was in shambles which made it relatively easy for the U.S. to lead in, oh, everything.
From the Latin conservare, to retain, it means to resist change.
First applied to politics to describe those resisting political change following the French Revolution.
Has come to mean a variety of things, from “resit change” to “return to how things were”. Frequently refers to an idealized image of how things were, such as wanting to return to how things were in the 1950s when homosexuals were in the closet, divorce was uncommon, premarital sex was taboo… without the 90% top marginal tax rates, strict business regulations and large trade tariffs that also accompanied the times.
Your definition of “less government” seems not to fit the more popular definitions of “Conservative”. Seems to me it is you that does not understand the meaning of Conservative, and are confusing it with Libertarian…. The party of which I have been a member of in the recent past, until I understood the true nature of fiat money, and why Libertarian political philosophy would prove to be a pragmatic disaster in the modern economy.
Look ,everything boils down to the rich getting richer and the middle class and poor getting poorer . Not only is this is crazy allocation of resources ,but its not very humane . A Government designed and rigged to put more money in the pockets of billionaires or Monopoly Corporations is just foolish . What purpose does it serve ? It’s a waste .
The more money the elite get the more they go for power and control and more inhumanity . Who does the Military really protect these days ?They got felmale/male Vets that are homeless who served their Country ,but they have been deserted .
All the Power Brokers are doing is getting the different classes and age groups to fight with each other ,and they don’t care about any pain and suffering of the population . They don’t care about any of the promises that were made .
It’s just very clear that American got hijacked by a small percentage of the population that got their way with the lawmakers . The regulatory agencies are now in bed with the Monopolies these days .
It’s just getting worse and worse for the majority population ,with more pain to come .
You have a problem with Corporate Communist Capitalism?
You forgot the word “Comrade” at the end of your question.
Shhh!!!
They’re always listening!
It’s just very clear that American got hijacked by a small percentage of the population that got their way with the lawmakers .
Did the Koch Brothers really have financial dealings with the Supreme Court Justices whose swing decision determined the outcome of the Citizens United case? Reason I ask, this was alluded to in the latest episode of “The Newsroom”.
While the hijacking of our political system happened awhile ago, Citizens United just helped consolidate power…
The rich can only get richer while the middle class and the poor get poorer because the middle class and poor keep spending as if they were rich, borrowing the difference. Or having the government do it for them.
The private sector version of this particular road to serfdom collapsed in 2008. Or would have if the government didn’t step in to prevent the value of the paper assets held by the rich, which are really just promises by the non-rich to live poorer in the future, from being wiped out in a bonfire of bankruptcy.
Now the government is on the clock. Now the rich, who forget who was really bailed out, resent the money the government has borrowed the expense of future generations to keep the poor from deprivation. Just wait until the lower 99 percent stop spending. They’ll change their tune yet again.
If the 99% stop overspending, and stop attempting to repay their debt… well,the paper assets of the rich will be as valuable as squares of toilet paper.
How is this story going to play out ? How is the course we are on going to produce a sustainable economy in which you don’t have a third or half the population living at poverty levels with a high unemployment rate without enough taxes collected to even sustain a small government ?
How is the story going to play out ?
Maybe Tough Love?
OH’s legacy is the death of Political Correctness so we can ask the hard and not polite questions??
Every week, it seems somebody else is calling a “bottom” in the housing market and this week is no different. On Tuesday, Zillow joined the crowd, reporting its U.S. home value index climbed 0.2% in the second quarter vs a year ago, the first increase since 2007. The index rose 2.1% vs. the first quarter, the strongest gain since 2005.
“It seems clear that the country has hit a bottom in home values,” Zillow Chief Economist Stan Humphries said in the report. “The housing recovery is holding together despite lower-than-expected job growth, indicating that it has some organic strength of its own.”
So why is this “housing bottom” call different from all the other “housing bottom” calls? Unlike many (many) other pundits, Humphries had steadfastly resisted the temptation to call a bottom until now, as faithful viewers of The Daily Ticker will recall.
“Generally, we’ve been more on the bearish side,” Humphries tells me in a phone interview. “Our expectation had been a bottom more likely later this year or early 2013. We moved that up based on the assessment of what we saw in the second quarter.”
To be sure, Humphries is cautiously optimistic at best, forecasting a U- rather than V-shaped recovery, with national home prices rising just over 1% in the coming years. His optimism is tempered largely because of the downward pressure foreclosures will exert on prices; still, he’s not looking for a “tsunami of foreclosures” and notes investors are eager to buy distressed properties and convert them into rentals.
What Zillow saw was strength in the market despite what Humphries calls “not insignificant headwinds” — most notably a sharp slowdown in monthly job growth and ongoing concerns about Europe’s debt crisis and its impact on the global economy.
‘…he’s not looking for a “tsunami of foreclosures” and notes investors are eager to buy distressed properties and convert them into rentals.’
What he and other serial bottom callers seem to ignore is the potential for the Eurozone crisis to spill over into the U.S. labor market, leading to higher unemployment, more foreclosures and less purchase demand for U.S. housing.
Just found out what (multiple) traumatic amputations, and a dead grandma (shredded by an old shadetree modified fighter plane impacting on top of her at 450 mph) are worth in US America, circa 2012.
A lot less than you would think.
Yikes! I may regret asking this, but… details?
Interesting stuff in my world these days…
1. Getting promoted to a supervisory role is a great way to see who your friends are.
2. Still surrounded by vacant homes.
3. I’ve re-opened talks with a former employer. I may be going back into the music biz, either L.A. or Nashville. I’m really hoping if it pans out, I’ll be in Nashville.
4. Wifey has finally chilled out about homes. For real. She truly gets it now.
The thing that is starting to bug me is all of the stories about people buying SFR’s in order to convert them to rentals, with all this excess rental inventory coming online its going to have to drive down rental rates, which will presumably decrease demand for purchases… right?
and put rentals underwater, thus a whole ‘nother round of defaults.
Sweet! Maybe?
What is the vacancy rate? That is the simple question you need to answer.
In other words, are there too many physical structures for the local population?
In California, the vacancy rate is relatively low (rental housing at ~5%, vacant owner occupied homes at ~2%, with a ~50% home ownership rate, this is a blended vacant housing unit rate of ~3.5%). In other states, it is much higher.
I am aware of one group doing the buy/rent strategy in Southern CA. It is very uncommon for them to buy a foreclosure and have the house actually empty. So at least in that market, it is a giant game of musical chairs…family leaves a house from which they were evicted (foreclosed), and they then move to rent another…or in many cases, they simply rent back the house that they recently lost to foreclosure.
In other markets, with higher vacancy rates, the situation will look different.
Expecting this to result in a glut of rentals, and another round of defaults is unlikely based on what I know. Reasons?
1. Most of the groups I know doing this are not buying a single home…they are targeting tens, if not hundreds of homes. A few vacancies aren’t going to tank the portfolio.
2. The math is such that decreases in rents in an area are not going to cause big problems. A rough example that I’m aware of, which is indicative of the buy/rent strategy in Southern CA:
Home Acquisition: $150k, rented back to the prior occupant at $1,400 per month (these are actual numbers).
Fix-Up initially: ~$5k (not a big number due to the rent back, mainly stuff like life safety, electrical, etc.)
Annual estimate of insurance cost: ~$650
Annual estimate of property taxes: ~1,650
Annual estimate of property management (~8% of gross rents): $1,344
Annual estimate of maintenance costs: $500 (lots of homes in the portfolio, some will be more, some less)
So, annual income of ~$12,656, an unleveraged yield on cost of $155,000 of ~8.2%.
Bank willing to lend ~65% of cost (97.5k) at 30% (so the home couldn’t be sold to pay back the loan), AND rents need to fall from $1,400 per month to ~$750 per month (so the loan can’t be kept current), OR the maintenance costs end up being MUCH higher.
P.S. This home was acquired for ~107x the monthly rent. Isn’t that considered in the range of a fair price for the home based on the rental value? Isn’t that a reasonably good explanation for why buy/rent strategists are coming out of the woodwork (ie. that prices have corrected to the point where they make sense on a rental basis)?
A big piece got cut out there, weird.
Bank willing to lend at ~65% of cost ($97.5k) at 30% (so the home couldn’t be sold…
again…$97.5k) at less than 5%, for a leveraged yield of more than 13%. So, for a foreclosure to happen, the price needs to fall by more than 30% (so the home couldn’t be sold…
Hopefully that takes.
A lot of people I talk to don’t feel like they have job stability anymore . Some people I know are freaked about their pension plans going BK in the near future . Nobody knows where the next hit will take place . When the talking heads talk about cutting spending that also means more job loss in the final analysis .What is going to turn this economy into a expansion cycle ?
“What is going to turn this economy into a expansion cycle ?”
More debt of course.
Holy crap — what kind of scam is FedGov perpetrating on college students? How are 5% rates “low interest” when Treasurys are plumbing all-time record low yields?
Federal Perkins Loan
Federal Perkins Loan (formerly Perkins Loan Program) is a federally funded program providing long-term low-interest (5%) loans for students who demonstrate financial need.
…
I’m sure I repeat myself, but is the MSM repeatedly recycling the same financial news stories, merely changing the dates?
Asia stocks diving deeper
Asia markets fall sharply as concern that Greece may need further debt restructuring, along with disappointing U.S. earnings, hit sentiment.
—————————————————
July 25, 2012, 1:42 a.m. EDT
Asia stocks hit by Apple results, Greece
By Virginia Harrison, MarketWatch
SYDNEY (MarketWatch) — Asia markets declined Wednesday as concern that Greece may be unable to pay off its debt hit sentiment, with technology shares battered in the wake of disappointing earnings from Apple Inc.
Japan’s Nikkei Stock Average (JP:100000018 -1.44%) lost 1.7%, South Korea’s Kospi (KR:SEU -1.37%) dropped 1.2%, and Hong Kong’s Hang Seng Index (HK:HSI -0.79% HK:HSI -0.79%) fell 0.7%.
Australia’s S&P/ASX 200 index (AU:XJO -0.17%) shed 0.3% and China’s Shanghai Composite Index (CN:000001 -0.47%) slipped 0.2%.
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Calif. police shootings spark 4th night of protest
Updated 4m ago
ANAHEIM, Calif. (AP) – Riot police fired bean bag rounds and pepper balls into a crowd of protestors late Tuesday outside City Hall as councilmembers inside voted unanimously to ask the U.S. attorney’s office to investigate recent officer-involved shootings, including one of an unarmed man.
The back-to-back weekend shootings have sparked four days of protests. A crowd of protesters who were shut out of the council meeting because there was no more room grew violent, tossing rocks and bottles at police and ignoring warnings to disperse.
Officers formed lines to try to contain the crowd as residents set fire to trash cans, loudly taunted police and swarmed a Starbucks, breaking windows.
Police helicopters hovered from above as colorful fireworks from nearby Disneyland lit up the sky.
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Great you’re running from the police..(maybe an Illegal) and you get shot and people riot…..
I love the logic
Global shares fall as worries about Spain, contagion intensify
By Chikako Mogi
TOKYO | Wed Jul 25, 2012 1:28am EDT
(Reuters) - Asian shares fell and the euro wobbled above multi-year lows against major currencies on Wednesday as soaring borrowing costs deepened worries that Spain might need a bailout, while Greece appeared unlikely to meet conditions of its aid package.
European stocks were seen slipping and U.S. stock futures were down 0.2 percent, indicating a weak start on Wall Street after three consecutive losing sessions for the S&P 500 index .SPX.INX. Financial spreadbetters called the main indexes in London .FTSE, Paris .FHCI and Frankfurt .GDAXI to open down as much as 0.7 percent. .EU .L .N
MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS slid 1.1 percent to a one-month low before paring some losses to stand down 0.8 percent.
Worries about the euro zone crisis hurting corporate earnings worldwide sent Korean shares .KS11 down to their 2012 lows while resource-reliant Australian shares .AXJO fell on prospects of weakening demand for commodities.
Japan’s Nikkei .N225 fell 1.6 percent to a seven-week low.
Grains extended their losses on Wednesday, as traders took profits from last week’s record highs on improved weather forecasts, which gave some relief to the U.S. crops’ outlook.
Copper hit a one-month low and U.S. crude eased 0.3 percent to $88.25 a barrel and Brent shed 0.3 percent to $103.12.
“Generally speaking the outlook for commodities is linked to the outlook for Europe, and the outlook for Europe hasn’t got much better for quite some months,” said Richard Murrow, the director of E.L. & C. Stockbroking.
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Is Fresno Next?
By Victor Davis Hanson
July 24, 2012 12:19 P.M.
There is a Citigroup report out that bond watchers are now worried about Fresno following Stockton into bankruptcy — which would be, if true, a much more serious calamity given Fresno’s far greater size and budget.
Throughout California’s Central Valley, almost everyone the last decade or more has witnessed a perfect storm of events that evoked a reaction to each day’s news along the lines of “This can’t go on.” To pick up a paper is to collate familiar categories of stories — huge public pension and salary agreements, coupled with warnings from analysts at the time that they were unsustainable; reports of exoduses of high-income earners from the center of the state (both to the coast and out of state); near-constant carnage of shootings, felony-car-accidents, and random mayhem that put each day hundreds of the uninsured into public-supported emergency rooms and hospitals; daily lawsuits against municipalities and schools on behalf of various aggrieved parties; vast increases in Medi-Cal and public-assistance rolls; and schools whose test scores are among the nation’s very lowest and whose rates of violence are not.
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“…reports of exoduses of high-income earners from the center of the state (both to the coast and out of state); near-constant carnage of shootings, felony-car-accidents, and random mayhem that put each day hundreds of the uninsured into public-supported emergency rooms and hospitals; daily lawsuits against municipalities and schools on behalf of various aggrieved parties; vast increases in Medi-Cal and public-assistance rolls; and schools whose test scores are among the nation’s very lowest and whose rates of violence are not…”
California: Love it or leave it.
Will the Fed end its “screw the retirees” program after 2014, or is it likely to continue the policy indefinitely?
ft dot com
July 24, 2012 12:25 pm
Zero rates force US funds to chase income
By Dan McCrum and Michael Mackenzie in New York
In the summer of 2007 the California Public Employees’ Retirement System, the largest public pension fund in the US, announced that an effervescent 19 per cent return for the previous 12 months had taken its assets to a record $250bn.
Five years on and investment gains for the state’s prison guards, firefighters, janitors and other government workers have been less than pedestrian: they are effectively zero. Payments to retirees have eroded the asset base, meanwhile, leaving Calpers with $233bn, according to a preliminary annual report released last week.
It is in this environment, with the vast majority of corporate and public pension plans deep underwater, that investors confront a world in which interest rates are below one per cent in about 20 different countries. Yields on US Treasuries have touched fresh historic lows this week.
Larry Fink, head of BlackRock, the world’s largest money manager by assets under management, puts the problem in blunt terms: “Extraordinary low yield levels cannot meet the long-term return expectations for anyone.”
Yet public and corporate pension funds assume that their assets will, over the long run, produce returns of around 7.5 per cent a year. Foundations and endowments typically spend 5 per cent a year. With holdings of bonds that historically earned almost 3 per cent above the rate of inflation now a drag on portfolios, they need higher returns from their other investments.
Christopher Ailman, chief investment officer of the $120bn California State Teachers’ Retirement System, says that when Ben Bernanke, chairman of the Federal Reserve, announced that interest rates would be on hold into 2014 he called an “all hands on deck meeting to discuss ways to add additional income to the portfolio”.
A large pension fund such as Calstrs is like an ocean liner where the ultimate destination is set, he says, as it must remain invested in all the main asset classes, including government bonds.
Mr Ailman can only make “course corrections”, so the pension fund has tried to do this where it can, for instance by writing covered call options that sacrifice some upside to stock holdings in return for premium income upfront. It has also looked for opportunities in credit, such as bank loans and infrastructure investment, while the fund’s extensive real estate portfolio is tilting towards buildings with leases in place that generate income.
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ft dot com
Last updated: July 17, 2012 12:06 am
Calpers earns just 1% annual return
By Dan McCrum in New York
The California Public Employees’ Retirement System, the largest US public pension fund, reported that it made an investment return of just 1 per cent in the year to June 30, underperforming its benchmark.
In a sign of the problems facing the cash-strapped state as its pension funds mature, preliminary results indicate that assets managed by Calpers dropped from $239bn a year ago to $233bn, meaning that the pension fund paid out more in benefits than it received in contributions and investment returns in the last year.
California will increase its contribution to the fund by $213m this year, from $3.5bn in 2011-12, but the amount will still be lower than the $3.9bn the state paid in two years ago.
Calpers said that the final figure for assets under management could still rise, as it does not include the most up to date investment returns from illiquid assets such as private equity. However, assets are expected to drop from 74 per cent of liabilities at the end of last year towards 70 per cent.
In April, a report prepared for California’s second largest pension fund, the $151bn California State Teachers’ Retirement System, said that the hole represented by its 69 per cent funding ratio was too great to be filled by better investment performance and that on current trends it would run out of money entirely in about 30 years.
On Friday Calstrs reported a 1.8 per cent investment return for its fiscal year. Both pension funds assume returns will average 7.5 per cent annually, in line with their investment performance over the past two decades.
Calpers said that it was hit by significant allocations to US and international public equities. “The last 12 months were a challenging period for all investors as the ongoing European debt crisis and slowing global economic growth increased market volatility and reduced equity returns,” said Joe Dear, Calpers’ chief investment officer.
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