Bits Bucket for August 28, 2012
Post off-topic ideas, links, and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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I find it quite interesting that cantankerous/pbear/etc and RAL/Cratering/Etc both refuse to spell my name correctly. They both, always choose to change it the ending “ell” to “yl”.
Hmmmm.
And neither seem to have any grasp of macroeconomics.
Late yesterday, we again got Cantankerous’s rant about how Iceland did it right by not transferring the cost of bank restructuring onto the tax payers, and instead, letting the banks eat the loss.
Ugh, we’ve gone over this before.
1) Most of Iceland’s debt was denominated in Euro’s and was owed to other European countries. The problems we are seeing in Spain’s and Italy’s banks is, in part, the Icelandic debt.
2) Only a very small fraction of Europe’s banking problems is the loss from the Icelandic debt. Why? Iceland’s debt was tiny, tiny, tiny, because the entire population of Iceland is tiny, tiny, tiny, TINY!
Iceland’s total population is 313,000. No, I’m not missing any 0s. 313K. Not only does the Unites States have more babies born every year than the entire population of Iceland, we have 13 times as many babies born every year than is the entire population of Iceland.
No, seriously, the number of legal immigrants into the United States every year, is more than 3x the entire population of Iceland.
The USA has 1000x as many people as Iceland, CA has 120x as many people as Iceland, San Diego county has 10x the population of Iceland, the city of San Diego proper, excluding the suburbs has 2x as many people as the entire population of Iceland.
So, Iceland letting the big Euro banks eat the losses is less like a national meltdown, and more like a smallish USA city going bankrupt.
3) Iceland’s total foreign debt (government and banking sector was 50B Euro. Yeah, something like $50-60B. Shall I compare these numbers to USA again? That is what the USA is adding to the national debt every, oh, 2 weeks. Iceland’s national debt was less than $15B of that, and like $35B banking debt with losses expected in the range of $15B. To compare these to it’s GDP of $13B, rescuing the banks would have basically doubled the national debt from 115% of GDP to almost 230% of GDP. All of that debt is “privately held”, not this fake trust fund, intergovernmental borrowing BS.
Again, compare to USA where real, publicly held national debt has doubled from $5T to $11T over the last 5 years, against GDP of $15T. Yeah, from 33% to 70% of GDP.
4) Macro-economically speaking, the Euro banks could afford to eat a loss of some $25B that hit them from the debt Icelandic debt restructuring and banking system failure. Again, comparing to the USA, that loss is less than the loss from Lehman. Lehman brothers bankruptcy handed out $65B to the creditors that were owed a total of more than $325B. So, the loss from Lehman alone was about 10x the loss on Icelandic debt.
5) Iceland’s GDP of $13B is .026% of the $50T global GDP. Drop n the bucket a 50% drop in Iceland’s GDP is less than a rounding error in global GDP. This means that even though they are buying less from the world, the world is buying just as much from them. No feedback loop.
USA’s GDP of $15T is 30% of global GDP. A drop of 50% in USA GDP is a drop of 15% from global GDP, which would not only put the globe into depression, it would be a negative feedback loop where the world’s economies would be so devastated that their purchases from us would drastically slow, feeding back into falling USA GDP and falling global GDP…
And finally….
6) How did Iceland recreate the banking sector? It took about $4B, 1/3rd of its GDP, and handed it to 3 private corporations to allow them to create new banks to replace those that it let fail.
Conclusion:
Solutions do not scale. The world could afford to eat $25B in bad Icelandic debt. No way could the world afford to eat $30T in bad USA debt.
Any argument that the USA could follow Iceland’s example is the equivalent to saying that since you can eat a one pound steak in a single meal, you can clearly eat, in a single meal, the whole 1000 pounds of meat that would come from butchering 2 cows.
And the economists who were quoted saying that Iceland had done the right thing were not saying that the US could or should follow suit. Here’s one of them, Krugman:
You win, Darryl — I have no more energy to respond to your voluminous rants. Take it up with some of the big name economists included in my post from last night, who you fail to acknowledge in your rant above.
“refuse to spell my name correctly…”
It’s an interesting aspect of human nature, that some people who spell their name funny insist everyone expend the energy to get it their way, like it was an intolerable insult if they didn’t, and that has to be taken care of before discussion can continue. I left the umlat off a guy’s name in the club meeting minutes once and he screamed at me for five minutes, in the board meeting.
Darrell is a perfectly acceptable spelling of the name.
What happened to the days of polite discourse here? This used to be such a nice place to visit.
Agreed. What does it say about the person, once corrected, who continues (no doubt purposely) to misspell it?
Never graduated from the 4th grade playground?
What happened to the days of polite discourse here? This used to be such a nice place to visit.
What he said.
What happened to the days of polite discourse here? This used to be such a nice place to visit.”
there is a fork in the road ahead and it has caused confusion about which path to take.
The point was not that I care how they misspell my name. I suspect that they are the same person, with the same Idiosyncrasy. The same refusal to admit the fundamentals of macroeconomic feedback loops.
Actually darryl, you’re so corrupted by your dishonesty that you don’t actually realize that there are entire groups exposing your BS and the BS of others.
I suspect that they are the same person,
Ooh! That’s an interesting theory. CIBT=RAL. Kind of a Dr. Jeckyll/Mr. Hyde kind of thing.
I keep asking CIBT to repost the data that RAL says he posted from Census data that supports the 25 million excess empty houses thing (now up to 28 million) and none of his known aliases (Bear, stucco, CIBT) ever responds, though RAL or one of his aliases sometimes does (by telling me to look it up myself, not with data). It is an interesting hypothosis. Would need more information to confirm.
RAL is the artist formerly known as exeter, who is in the NE somewhere. Don’t remember where PB is from originally but perhaps it was the NE, so the NE/SW Jekyll/Hyde (or is it Jekell?) bipolarity meme makes some sense!
I also seem to remember that exeter, he now of the “don’t buy anytime/anywhere” brand, was shopping (at least online) for a place in Bend, OR, one of the bubbliest and nauseatingly trendiest of bubble zones, so he’s not without sin.
WRONG again.
“Shopping”??? lmao…. Choosy mothers choose Jiff?
Just for fun, I’d love to see exeter resurrected to torment some of the faithful. RAL has a place in the pantheon of HBB personalities, but exy was by far the more thoughtful. For those of us who read the blog for subtext, that effort wasn’t wasted.
Alena,
Pushing back on the overt pimping of housing and misrepresentation of the truth by the Housing Crime Syndicate takes priority. They’re here, reading and writing and paid to do so. The truth is the Housing Crime Syndicate destroyed lives probably in the millions. In retrospect, I believe we devoted too many wasted words on the election/political BS and topics too ethereal. At least I did. No more.
PS- Saw your comments late last nite on the evil axis war machine(no need to name countries right?
) pushing the Iran thing. You’re one of the few that really understand.
Peace
They’re here, reading and writing and paid to do so
I am still wondering if there is any way to prove this is so (for this blog or just online in general).
Anyone care to anonymously fess up? Or anyone here actually know a real live person who gets paid to troll?
lmao…. it doesn’t get any better than that.
“Anyone care to anonymously fess up? Or anyone here actually know a real live person who gets paid to troll?”
You just implicated yourself, you lying shill.
A close personal relation (ahem) gets paid to troll for the far right.
Don’t believe everything you read.
Color me paranoid but I’m slowly, very slowly coming around to RAL’s vastly-more paranoid view.
This forum has definitely degenerated. The trolls are a lot more subtle. I’m not sure naturally (noone could ever be!) but take a look at the other forum posted today by Ben for some rather egregious examples.
It’s rather strange, I must say.
“Don’t believe everything you read.”
…including this
“The trolls are a lot more subtle.”
Insidiously so. Turn up the sensitivity on your Bullshit Meter.
“It’s rather strange, I must say.”
I just see it as yet another sign that extend-and-pretend is working…momentarily.
I have an unusual last name.
Which compels me to help others spell and pronounce it correctly. I like to do so with a dose of humor, because that’s my style. Much better than hollering at people.
I’m surprised anyone would need help spelling “Slim”!
But hollerin’s fun — just ask Darryl!
You fail to acknowledge that some things do not scale.
The “right thing” for a nation with half the population of San Diego, with total debt equal to a fraction of a % of global GDP, may not be the “right thing” for the world’s 3rd most populous country with a GDP that is 30% of the global GDP.
Sherman Reintroduces “Too Big to Fail, Too Big to Exist Act”
April 27, 2012 11:13 AM
Washington DC – Yesterday, Congressman Brad Sherman (D – CA), reintroduced the “Too Big to Fail, Too Big to Exist Act,” (HR 4963) in the 112th Congress. The legislation was cosigned by Congressman Maurice Hinchey (D-NY). Senator Bernie Sanders (I –VT) introduced similar legislation in the Senate during the last Congress. Under this legislation, any institution that is too big to fail will be broken up and reorganized to avoid more Government bailouts and future risk to our economy.
“Too big to fail should be too big to exist,” said Congressman Sherman who has advocated this position since 2008. “Never again should a financial institution be able to demand a federal bailout. They claim; ‘if we go down, the economy is going down with us.’ By breaking up these institutions long before they face a crisis, we ensure a healthy financial system where medium sized institutions can compete in the free market.” Sherman continued, “No longer should giant financial institutions be able to get low-cost capital by telling investors that even if the institution is mismanaged and faces financial default, by virtue of its sheer size it will be able to obtain a bailout from the federal government. Every financial institution should compete for capital based on the soundness of its balance sheet, and no financial institution should be able to claim that there is a special federal safety net available to its investors because of the institutions sheer size.”
“Most of the huge financial institutions still standing have become even bigger — so big that the four largest banks in America (JP Morgan Chase, Bank of America, Wells Fargo, and Citigroup) now issue one out of every two mortgages; two out of three credit cards; and hold $4 out of every $10 in bank deposits in the entire country,” said Senator Sanders, when he introduced his version of the legislation last Congress.
“If any of these financial institutions were to get into major trouble again, taxpayers would be on the hook for another massive bailout. We cannot let that happen. We need to do exactly what Teddy Roosevelt did back in the trust-busting days and break up these big banks.”
…
“Too big to fail should be too big to exist,” said Congressman Sherman.
“We need to do exactly what Teddy Roosevelt did back in the trust-busting days,” said Senator Sanders.
Why pass a new Sherman Anti-Trust act when you already have one?
Why pass any new law when the ones on the books are not enforced.
Does anybody think they can get anything
passed right now ? I always like Brad Sherman because he voted against the Bail Outs ,and so did Senator Sanders .Not surprised those 2 guys are sponsering a bill of this nature to break up the TBTF.
But, this seems to be the new way with politicians to pass new Bills to enforce laws already on the books . I guess you cold call them the “WE REALLY MEAN IT THIS TIME LAWS.”
I’d love to see the big banks broken up.
However, that would not make them able to absorb up to $5T loss that would be likely should real estate on the national level fall to pre-bubble levels.
As Ben loved to point out in the bubble days, we doubled prices while actually increasing the debt to price ratio… we were taking on debt FASTER than house prices were rising. Well, if prices return to pre-bubble, lots and lots of that extra debt will poof….
… I was going to say out of existence, but with FHA and FDIC, much of the poofage will just be off the banks and onto the national debt.
“Does anybody think they can get anything
passed right now ?”
And I do not see that changing.
Democrats win, they call it a mandate, but the Republicans call it a huge mistake by the voters and go into obstructionist mode. When the Republicans win, they call it a major voter mandate, but the Dems call it a temporary set back and go into obstructionist mode.
Note to some of our not-so-master baiters:
Representatives Brad Sherman and Bernie Sanders, who led the House revolt against the TARP bailouts (let me repeat that:) LED THE HOUSE REVOLT AGAINST THE BAILOUTS and who have sponsored and continue to champion reinstating the Sherman Anti-Trust Act and enforcing its provisions against the banking cartel, are (shudder) PROGRESSIVES.
Fie on them!
What great democratic leaders!
In the House, 171 Democrats and 91 Republicans voted for it. In the Senate 40 Democrats, 33 Republicans and 1 Independent voted for it.
http://www.huffingtonpost.com/2009/01/15/tarp-vote-obama-wins-350_n_158292.html
Sorry, Senator John Sherman was definitely not a progressive, not by my definition. I suppose the term Progressive was hijacked by radicals going all the way back to the early 1900’s
Progressives lie and continue to represent themselves as something completely different from what they really are, they are not on your side. They are radicals and subversives and have entrenched themselves in to every part of our society especially the government.
They are anti-American, anti-constitution, anti-capitalist and are found across many isms. They will team up with any movement that helps them get closer to their goals, a good example would be their support of radical Islamists. The enemy of your enemy is your friend.
In today’s environment, Progressives are squirming and running for cover like cockroaches after you turn on the kitchen light in a dirty person’s home. They prefer to combat our freedoms and the constitution under the cover of secrecy and lies. They are being outed thanks to the alternative media.
Example: University professors and public school teachers (a majority but not all), they take young inquisitive minds and fill them with the pollution of anti-American, anti-capitalist and anti-constitution propaganda. Mom and Dad have no chance to stop this indoctrination other than to home school and choose their colleges wisely.
Can you read?
Depends on the day.
I’m generally a republican voter, so please take what I’m about to say in context.
The republican’s have to stop pandering to crazy people:
http://religion.blogs.cnn.com/2012/08/25/8-ways-faith-will-matter-at-the-rnc/
“Israel is especially important to the GOP’s evangelical base, some of whom see a biblical bond with the Jewish people and some who believe Israel must be in Jewish control before the Second Coming can happen.”
And, for those of you who don’t know.. The 2nd coming is when all the believers (whoever picked the “right” religion) will be immediately whisked away to heaven (killed, or at least, that’s what it sounds like to me). And this event is something that the believers eagerly look forward to (sometimes called “The Rapture”, although not actually the same thing). The question I always ask; why wait for a 2nd coming, if you hate it here so much, and really wish us all dead, why not “take matters into your own hands” and make your dream a reality.
http://en.wikipedia.org/wiki/Second_Coming
Is pandering to a mentally deficient sect now a political strategy? How on earth can we support people who, without any argument, are trying to bring about the end of the world? We normally would call these people terrorists. And, unfortunately, I’m afraid that a lot of the people who believe this are about 1 sermon shy of strapping a bomb on their chest and walking into a public place. These are the people the Republican’s need to appease during the convention?
I’m going to vote R this year. But man, am I going to have to hold my nose.
“I’m going to vote R this year.”
well…there you go.
Wish they’d all move to the South and secede already.
Why?
The party of slavery, jim crow laws and filibustering civil rights laws was the DEMOCRAT party
The party of slavery, jim crow laws and filibustering civil rights laws
Then came the Reagan Revolution, and those voters all switched to the GOP. (It actually started earlier, The Reagan Revolution was just the grand finale of the great Scotch-Irish political party switch.)
An amazing transformation to fit your warped view of the world and to escape and/all responsibility for terrible actions.
I do not even think neo-nazis could do it better.
Truly amazing you can ignore 120 years of history and peer into men’s hearts
It’s even more amazing when people refuse to acknowledge that things have changed over the last 100 years.
“I do not even think neo-nazis could do it better.
Truly amazing you can ignore 120 years of history”
i think most democrats are well aware of the history of their party. Those that aren’t should be, but where do they take that from there? “Oh, the democratic party was once the party of blatant racism, but they willingly gave that up along with the votes that came with it? Nope, can’t vote for them.”
I think it was LBJ who observed that with the Civil Rights Act, the Dems had lost the South forever. Almost makes it look like they sacrificed their base to do the right thing.
Which explains why the “DEMOCRAT party” nominated and voted for a man who was half-black.
Ba ZING
All of the above is true. But Nixon’s “southern strategy” brought all the racists and fundy wingnuts into the GOP fold.
Maybe instead all the secular humanists will secede and leave the Free Sh*t Army (and their Race Hustler enablers) and the wingnut Rapture Bunnies to squabble.
But Nixon’s “southern strategy” brought all the racists and fundy wingnuts into the GOP fold.
Yep. That’s what I was alluding to when I said it had started earlier. Nixon was a brilliant politician, his ’southern strategy’ worked quite well. Here’s wikipedia on it:
brought all the racists and fundy wingnuts into the GOP fold.
Really? There’s not a single racist person in Democratic party?
I always learn something new on this board.
Correction: brought all of the white racists who hate black and brown people (especially poor black and brown people) into the GOP fold.
The Democrats retain all of the black racists who hate white people (and their white liberal guilt fluffers) in their base.
Legend has it that after signing the Civil Rights Act of 1964, Johnson turned to an aide and said, “We have lost the South for a generation”.
“We have lost the South for a generation”
And he misunderestimated at that.
I wish they’d kick the religious wingnuts out of the party. Why on earth does fiscal conserativism have to be linked with God and guns? I just want a president who’s not going to view me as the enemy and try to tax me to death. And, since that’s the thing a president is most likely to do (increase/decrease taxes), I vote on taxes over everything else.
That said, I hate putting religious nuts in office, and, frankly, I think that Mitt might well be a zealot.
I think that Mitt might well be a zealot.
and a tyrant?
Texans don’t necessarily want to have an ugly floor fight on the same day the party officially nominates Mitt Romney. But they’re willing to do it if their concerns about the rule aren’t satisfied. The changes, which Mitt Romney’s top lawyer put forward last week and Gov. Haley Barbour along with some other Romney supporters have embraced, are seen by opponents as intended to significantly weaken the power of grassroots politics and insurgent candidates such as Ron Paul. Many against the move worry that it would give national candidates the power to replace delegates–often grassroots party faithfuls–with big-time donors or friends.
“We truly consider that an infringement on our rights,” Fredricks, a member of the rules committee, told Yahoo News of the changes. Today, states generally choose their delegates at state conventions, and then those individuals travel to the national convention to cast their vote for a candidate based on the share the candidate won of the primary or caucus vote of each state. But, the changes could allow a candidate such as Mitt Romney to boot out any delegates who are assigned to vote for him and replace them.
While opposition to the rules began with Ron Paul supporters, it has spread to the entire Texas delegation and significant portions of those from South Carolina, Colorado, Virginia and Louisiana too. Mitt Romney’s campaign lawyer Ben Ginsberg proposed the rule last week, but even some Romney supporters are staunchly opposed to the changes. Indiana delegate and Romney supporter James Bopp wrote in an email to RNC members that it’s “the biggest power grab in the history of the Republican Party.” Fredricks, a Romney supporter, says only 30 people of the more than 300 Texan alternates and delegates support Ron Paul, yet the delegation is “united” in its opposition to the rule.
“The changes, which Mitt Romney’s top lawyer put forward last week and Gov. Haley Barbour along with some other Romney supporters have embraced, are seen by opponents as intended to significantly weaken the power of grassroots politics and insurgent candidates such as Ron Paul. Many against the move worry that it would give national candidates the power to replace delegates–often grassroots party faithfuls–with big-time donors or friends.”
One thing about Mormonism which America may be soon to learn: It is a religion which tolerates absolutely no dissenting views.
I’m sooooo hoping that AZ and TX delegations stage a coup on the convention floor. If I have to watch an uninterrupted Donnie and Marie Show all week I think I’ll vomit.
Oh boy. Speaking from the local level, I can say that they’re just barely holding on to the Paul faction and other discontents as it is. I’m pretty sure the situation in MT is typical.
Why on earth does fiscal conserativism have to be linked with God and guns?
Because the Republican party can’t get enough votes otherwise. For all their purity testing, Republicans are a bigger tent than the Dems by necessity.
My discussions with many of the God and guns crowd pick that over true conservative values. It’s why Ron Paul doesn’t have traction with the party’s mainstream.
God + Guns + (you left out) Gays.
Make people afraid and they’ll vote for you to protect them.
Fiscal conservatism + no God + no guns = Chinese communist party
Actually given the miracle they have done to their country, not a bad party to vote for!
Would the Chinese have accomplished as much without a willing America to buy products with low prices due to low-paid labor and no environmental regulation whatsoever? That’s not a rhetorical question; I just don’t know.
“Fiscal conservatism”
Ugh.. Communists are a state planned economy, that’s the exact opposite of fiscally conservative government. By fiscally conservative, I also invoke the “Don’t tread on me” idea, low taxes, low regulation, less rules, more personal responsibility. The opposite of communist “central planning”.
Fiscal conservatism + no God
Curiously, China has two state churches:
The Three-Self Church (The official Protestant Church)
The Chinese Patriotic Catholic Association (not in communion with Rome)
The is also a Chinese Patriotic Islamic Association.
I think that depends on things like the mandate given to the beauracrats as well as their competence.
I wish they’d kick the religious wingnuts out of the party. Why on earth does fiscal conserativism have to be linked with God and guns?
If you look at the evidence, it would appear that it was the fiscal conservatives who were kicked out some time ago. Some of them just haven’t gotten the memo yet.
Unfortunately Carl, I think that I agree with you more and more with each passing election. They say things that “sound” conservative, but then, when elected, do the opposite.
I’ll be voting for Ron Paul. A symbolic gesture, I know, but at least I’ll know that I didn’t vote for Tweedle-Dee or Tweedle-Dum.
How on earth can we support people who, without any argument, are trying to bring about the end of the world?
I’m going to vote R this year.
You apparently should be asking yourself these questions, not us.
I vote for whoever is going to lower my taxes. However, it really pains me to vote for people where I question their sanity. I’d love a 3rd party (Libertarian) candidate. Small government (lower taxes) and less “nanny state” religious garbage.
Don’t complain then when they start WW3 to hasten Christ’s return.
And these are my choices? A president who openly wants to tax me to death and bring about socialism, or a zealot who wants to start WW3 to bring Christ back to earth?
Religion and politics do NOT mix. Our founding fathers knew this and tried everything in their power to prevent religion from becoming a defining force in American politics. Unfortunately, I don’t think that they could have anticipated the rise of the religious right, with all their backwards/science hating ways.
How would you feel if one of the idiots who believes in God prevents a war? Would they still have to go to prison in your world?
Religion, no matter how “peaceful” it may be has been the lightning rod of nearly all conflicts from the dawn of time.
“A president who openly wants to tax me to death”
A maximum federal income tax maximum marginal rate of 39.6% is taxing you to death while a federal income tax maximum marginal rate of 35% is OK? Or 25% but with a bunch of unknown because they are unspecified deductions removed and really isn’t going to happen because it can’t get through Congress anyway is better? Really?
It’s a choice between Tweedledee and Tweedledum.
It’s a choice between Kang or Kodos.
It’s a choice between heads of the hydra.
You forgot Scylla and Charybdis.
Of course, Odysseus got past Scylla with what he considered acceptable losses rather than risk everything with Charybdis.
“How would you feel if one of the idiots who believes in God prevents a war? Would they still have to go to prison in your world?”
Of course not. And plenty of good people are religious. However, the facts speak for themselves, the more religious the nation, the more likely they are to engage in war. More people have been killed in the name of “God” than for any other cause/purpose in the history of mankind. This is actually rather logical, if you have a country that does not believe in God (and therefore, when you die, you really die), it’s very difficult to motivate them to go kill themselves on a battlefield. When you have an absolute belief in God (ie, Muslim extremists) you can send these people to battle with absolutely NO chance of survival (see, suicide bombing).
What you are describing is the following of men, not God. The best society is the one in which men are not worshiped, or obeyed without critical thought. Psychopaths will have a following among the weak minded and it will be under any cloak that appeals to the herd, not just their religion. Take any club you’ve ever been in for example……
And these are my choices? A president who openly wants to tax me to death and bring about socialism, or a zealot who wants to start WW3 to bring Christ back to earth?
Same difference. WWIII will cost A LOT in tax money.
I vote for whoever is going to lower my taxes
No matter what else they may espouse?
Would you choose a madman over a rational person as President, if the madman promised lower taxes?
I don’t think either of the 2 candidates presented by the media are a rational choice or rational people.
Ron Paul?
Overtaxed, the republicans cannot win without the fundamentalist vote (or pro-life, pro-gun, pro-religion vote). You are in the top 10% of earners, most will vote GOP for economic reasons, as you admitted. If the 90% voted for strictly economic reasons the GOP would never win a national election.
” To the doltish, religion is true. To the thinking, religion is false. To the powerful, religion is useful.”
both parties pander to their base.
not even sure why we are discussing this.
They usually only pander to their base during the primaries. This election is different. I suspect both parties feel incapable of connecting to the independent middle and need to get their base out to vote. What if Romney wins and then determines he has a far-right mandate? The best of times, the worst of times.
+1 on the last line Krisdad….
not even sure why we are discussing this ??
Well, then don’t discuss it Michael….Just pass-er by with your little scrolly thingy…
Isaac Newton and at least during some periods Albert Einstein would disagree.
Overtaxed,
Per this article the Dems are embracing the Islamist, inviting about 20,000 to their convention.
http://www.breitbart.com/Big-Peace/2012/08/22/DNC-Embracing-Radical-Islamists-At-National-Convention
Wonder what will happen when this group meets the gay liberation group at the convention?
Popcorn time!
And embracing “religion” is only bad if it has a “Jesus” in it.
From Wikipedia:
It is expected that Charlotte’s hosting of this event will generate more than $150 million for Charlotte and surrounding metropolitan areas and bring over 35,000 delegates and visitors.
20,000 out of 35,000? Really?
What would you expect from a Breitbart article?
OK Polly, we can discuss the #’s later, but maybe they are both off.
What about the fact that they (the DNC) are embracing the Islamic faith?
Do you understand how they treat their women?
Do you know how they treat non-believers, Christians and Jews?
Liberal/Progressives want to complain about Romney being a bully when he was a kid and yet you’re willing to accept people who do these things.
http://www.bing.com/images/search?q=islamic+abuse+of+women&qpvt=islamic+abuse+of+women&FORM=IGRE
‘you’re willing to accept people who do these things’
‘Abu Ghraib abuse photos ’show rape’. Detail of the content emerged from Major General Antonio Taguba, the former army officer who conducted an inquiry into the Abu Ghraib jail in Iraq. Allegations of rape and abuse were included in his 2004 report but the fact there were photographs was never revealed. He has now confirmed their existence in an interview with the Daily Telegraph.’
‘The graphic nature of some of the images may explain the US President’s attempts to block the release of an estimated 2,000 photographs from prisons in Iraq and Afghanistan despite an earlier promise to allow them to be published. Maj Gen Taguba, who retired in January 2007, said he supported the President’s decision, adding: “These pictures show torture, abuse, rape and every indecency.”
http://www.telegraph.co.uk/news/worldnews/northamerica/usa/5395830/Abu-Ghraib-abuse-photos-show-rape.html
Lip - o’dear where to start…
- DNC is fishing for any votes they can get, “embracing the Islamic faith” is a little too sensational.
- please define ‘they’, do you mean all 1.6 billion Muslims, or just culturally unsophisticated ingnorant males living in a foreign region that still has the feudal system of medieval Europe and self proclaim themselves to be following the religion of Islam?
I can assure you that voting Muslims are evenly split between D’s and R’s, and “W” was their hero. Besides, they do not have enough votes to swing the national election one way or the other - besides most of them immigrated from countries with disgusting political landscapes and the last thing they want to do here is become politically active. I’m not sure if you noticed this but the current President took some extra efforts to distance himself from even mainstream Muslim organizations during 2008.
I don’t remember ever saying anything positive about the Abu Ghraib prison guards. I would suppose that most are in the jail on the other side of the bars and that’s fine with me.
How can Polly, who would seem to be a nice liberal lady, overlook the fact that the Democratic Party is currying favor with people that want to put women into 2nd class citizenry? All at the same time the Dems are trying to accuse the Repubs of the “war on women”.
And Zee thinks I’m not logical or rational???
(repost- since my last posting vanished…)
(apologies in advance if this gets posted twice)
Lip - o’dear where to start…
- DNC is fishing for any votes they can get, “embracing the Islamic faith” is a little too sensational.
- please define ‘they’, do you mean all 1.6 billion Muslims, or just culturally unsophisticated ingnorant males living in a foreign region that still has the feudal system of medieval Europe and self proclaim themselves to be following the religion of Islam?
I can assure you that voting Muslims are evenly split between D’s and R’s, and “W” was their hero. Besides, they do not have enough votes to swing the national election one way or the other - besides most of them immigrated from countries with disgusting political landscapes and the last thing they want to do here is become politically active. I’m not sure if you noticed this but the current President took some extra efforts to distance himself from even mainstream Muslim organizations during 2008.
Well, I’ve known a reasonable number of Muslims in my life. There was a pretty large community that moved to my home town when they bought some land and built a big mosque there (though most of that transition was after I left). There was a very nice family who lived next door to my grandparents for a long time. There was an attorney at my first law firm who moved back to Pakistan after her time in NYC. Etc.
The people in my home town were mostly engineers and doctors who wanted a nice town to raise their kids. It helped that there was a kosher butcher near by and kosher meat is considered halal. One of the first things they did was build a school (absolutely fabulous for the tax base as they bought pretty big houses with substantial property tax bills and didn’t use the school system until 7th or 9th grade). No problems that I am aware of. I think they even went beyond what the town requested in terms of providing sufficient parking so the local streets wouldn’t get messed up on Fridays.
My grandparents neighbors were quiet people who kept up the yard and smilled and waved while basically minding their own business. I thought the women’s clothes looked funny when I was young, but that is about it. The next family to move into that house was a real downgrade.
I miss Ayesha. She had a wicked sense of humor and dared to wear pants to work at a firm where that Simply Wasn’t Done. She went back because her older mother needed her, though I suspect she could have gotten a permanent job in NY if she had tried.
A friend just got back from doing a year long fellowship in Jordan assisting with economic development (has a couple of business degrees and teaches part time at a business school in Colorado). She thought it was great. Only real problem she had while she was there was getting through an Israeli checkpoint to go take the State Department exam in Jersusalem.
I’m not particularly fond of the people in the apartment next door because they sometimes smoke on their balcony which means I have to close my windows, but they tone down the noise when asked, which is more than the law students used to do and smoking on the balcony is not against the rules in our lease.
The guy from Morroco who was in the show that I volunteer with last year was an amazing musician and we all adored him. Seriously. Rashid may have been the most popular guest artist we have ever had.
Do I have to go on?
OK, I give. I bet you don’t loose many cases do you?
I don’t go to court. Not my part of the system. But all lawyers learn how to argue. We also learn how to help people. Actually, I had a call from someone yesterday with a client question. It was about one area that I have given a lot of thought, and I was able to give her some good, solid help. Probably not the exact answer her client would have referred, but logical and explainable and she was very satisfied. It was a great day.
, I’ve known a reasonable number of Muslims in my life.
Polly the problem is not with American Muslims or those that move to America…its the ones who still live in the middle east….they are taught hate….
Eliminate the ayatollahs…the mosques….hey they want a religious Jihad. lets give them what they want.
Saddam Hussein would have been a nice guy had he never stepped a foot into a mosque….but then he would have never been the leader of Iraq…..
polly - don’t let logic, math or rationality get in the way of fear mongering - you are spoiling the fight/flee induced high of the primal rush.
Look. I’m not going to give a click to Breitbart’s site. I just can’t do it. If someone else is willing to look and summarize the article, please do. I’d be interested to know what it says. If I had to guess, I’d guess this:
Since the convention will include a Friday, they are setting aside a place for Muslim prayers, Friday being their sabbath and a time for collective prayer. Rather than stick the convention members who are also Muslim in a hotel meeting room for their sabbath service (where they would have had to clear out all the tables and chairs and stuff), they have invited the imam of a local mosque to lead those prayers (possibly on the convention floor) and said they would welcome the members of that mosque to join their imam as they normally would on Friday and the mosque has 20,000 members (most of whom don’t show up on Friday morning anyway). Alternatively, they have invited all the Muslims in the area to come to those prayers and there are 20,000 Muslims in the greater Charlotte area. That, of course, is assuming there is any basis at all for the 20,000 number.
So, anyone want to check and see how close I am?
Dear Polly,
I can assure you that Breitbart’s website won’t harm you.
It says that a Muslim organization quoted the 20,000 figure and this man, M Zuhdi Jasser, stated that the leaders attending the Zumhra were radicals.
http://aifdemocracy.org/2012/the-trouble-with-jumah-at-the-dnc/
Now I have no doubt that the Democrats are not going to be adopting much of the Muslim organization’s stands, but they are still courting their votes and in order to get their votes, they’re going to have to offer that group something.
I guess Zee’s post is the answer. The President really isn’t interested in their values, just their votes, so that’s OK with the liberal women in the US.
“currying favor with people that want to put women into 2nd class citizenry? ”
And remind me, just who is trying to stuff “Crazy Uncle” Akins back in the attic for putting some light in the dark corners of their platform?
DNC plans 2-hour Islamic prayer after rejecting blessing from Cardinal
The Blaze | August 28, 2012 | Erica Ritz
The Democratic National Committee is raising a number of eyebrows after choosing to proceed with hosting Islamic “Jumah” prayers for two hours on the Friday of its convention, though it denied a Catholic cardinal’s request to say a prayer at the same event.
And how do you think the good Cardinal would feel if Islamists insisted on offering Jumah prayers during his mass?
ahansen - last I checked, we still have private property laws, and if the Muslim organizers insisted on crashing the Cardinal’s services, they will get arrested for trespassing. Nice move at creating a hypothetical conflict situation.
btw: what the heck is a ‘Islamist’, there is Islam , the religion and Muslims, the followers. Is there such a thing as a ‘Christianist’? - just asking no offense intended.
When an argument is presented as a moral equivalency with intent to incite, I’ll counter it as a moral equivalency with intent to elucidate.
I use “Islamist” as I do “Christianist” or “Buddhist” or “Mormonist” or “Scientologist”. Religious philosophy is filtered through the interpretations of its proponents. It can only be truly known by the Author. And I don’t believe in those.
I mean no offense; simply find it more intellectually honest than calling a war-mongering capitalist “Christ”ian or a war-mongering misogynist “Muslim”. Jesus the Christ and Mohammad the Prophet have been politicized into national excuses. That’s not what they were about. (In my interpretation ;-)).
OIL makes strange bedfellows…….oh wait Oh is muslim
Voters Are Vegetables®
Vegetables are yummy.
Are you saying voters are yummy, too?
http://en.wikipedia.org/wiki/Fresh_Fruit_for_Rotting_Vegetables
http://www.youtube.com/watch?v=RZvFoSI5VN8
…”And that vegetable will res-pond to you.”
Jinglemale - are you still following this blog? I have some serious concerns about your business model but won’t bother typing them if they will fall on deaf ears.
More urgently - I read you were planning a refi with a 10 year reset on the interest rates. This is crazy. You really need to lock in the low rates for the life of the loan. Even if the interest rate is a bit higher. Don’t give me the BS that you will probably move. Most likely you will be stuck in your home so it is a good thing you like it.
Or are you telling us you plan to live up to your screen name at some time in the future.
His business model is “Taco Bell Jeff.” If you can stomach the cash burn for a while, the rapid appreciation will make you rich when you sell. It’s magic!
” Comment by Bill in Los Angeles
2012-08-26 09:01:28
P.s. you and I are hated by many HBHers simply because we work in defense, which is a necessary expenditure for a America if we are to have a government (”provide for the common defense.”). But slob types expect us to work without pay.”
As a veteran, I do not hate the military, per se.
I just think that about half the military budget is bloated, wasteful, crap intended to maintain the socialistic make work corporations of the military industrial complex.
My father spent decades as a defense contractor designing components of a ICBM defense system that had less chance of actually working than a snow-ball’s chance of surviving in hell.
The aircraft carrier is an outdated monument to the pre-cruise-missile, pre-in-air-refueling days of naval aviation. Multi-billion dollar, slow moving targets with little mission other than to keep millions of contractors employed building and maintaining them… slow moving targets in the event of an actual shooting war.
ICBM submarine fleet?
Stealth fighters that cost gazillions?
The B1? B2? F22, F35?
The marines never wanted the V22 Osprey, but congress wanted the jobs building it and Bell needed the profits. So, the marines got a plane it didn’t want, and the Navy had to replace the LHAs with LHDs to get the bigger flight deck needed to operate this VTOL plane that the marines never wanted.
Half of the DoD budget is money wasted on over paid consultants, unneeded and mostly useless toys, and HUGE profits for the defense industry.
After dad spent a decade designing a super powerful laser that could shoot down enemy missiles… except you couldn’t use it in the atmosphere as it would super heat the air causing diffraction, and scattering the beam, and you couldn’t use it in space since it needed to be hooked to a massive power grid that could not be reasonible constructed in space… Oh, it performed well in a vacuum chamber plugged into the SoCal power grid…
After a decade wasted designing stuff with no practice real world application, he was moved to DoE to see if the mega pulse laser could be used to build a fusion reactor. The answer is, yes…. and you get back out about 1/1000th the energy you put into it. Big improvement over prior designs where they were getting out 1/10,000th the energy put in….
So, it isn’t the military I hate. It is just the bloated budgets that get protected from cuts because they are ingrained so deeply into the American economy that the military industrial complex has the ability to protect itself from massive, needed cuts.
Taking a page from the NAR lie “there’s never been a better time to buy”, will truthfully assert that there’s never been a better time to be a government contractor
If Obama wins, more government contractor jobs will be created.
If Romney wins, more government contractor jobs will be created.
Sequestration will NEVER happen. Government contractors = WIN!
Sequestration will NEVER happen ??
Sequestration “MUST” happen as far as I am concerned….Let everyone feel some pain including the sacrosanct military…The Norquist party wants to slash government without any new taxes…Well here ya go…
IMO, it will be a great lesson to encourage compromise for both sides…
Sequestration is likely to hit the little guy. Do you honestly think the execs at SAIC, Boeing, Lockheed, Accenture, BAE systems, etc, are going to absorb the cuts in their high-6-figure salaries or absorb the cuts in allowing 1-2% less profit on ROI?
No, they’ll preserve their bonuses and profit at all costs, and it’s the high-5/ low-6 figure salaries worker bees that are going to get hit. The execs are already spreading doom and gloom about layoffs. I suspect that they are using doom and gloom as an excuse to cut workers anyway, even if their budgets aren’t cut a dime. After all, the most profitable company has no employees at all.
Sequestration is likely to hit the little guy ??
So whats news about that ?? Let those congress-critters deal with there laid off constituents when they return on spring break because they failed to do their job…They will vote them out of office which is EXACTLY what we need to send the meesage about running this country in a appropriate way…
the U.S. military…now there’s some competitive advantage for you.
15,000,000,000 for the next big fusion reactor. We just dropped MSL on Mars for 2,500,000,000. That’s an awesome achievement and it makes me proud to be a human being. I’d love to see us put about 150,000,000,000 into the development of fusion, uh, plants(?).
+1
Has anyone seen the movie “2016″, the anti-Obama movie.
Hi Martin. You sure got here super early to ask that question, didn’t you : ) You didn’t leave any thoughtful comment, or reason for the question — you just make sure to get the topic out there, and then you’re on your way. I wonder how many blogs will have this as their first comment of the day? Good job, Martin!!!! I’m sure the bromance team will thank you!! New Yorker cover:
http://slog.thestranger.com/slog/archives/2012/08/27/isnt-it-bromantic
This topic was discussed yesterday. Most people here seemed to agree that as it is a political propaganda movie for the Republicans, it isn’t worth watching such a long commercial.
you just make sure to get the topic out there
More Drudge Report links please! Bonus points if they’re from Breitbart, the Washington Examiner, or international hallmark of esteemed journalism, the UK Daily Mail
‘More Drudge Report links please!’
How about this one:
‘Drone strikes and targeted assassinations abroad have seen the US violating human rights in a way that “abets our enemies and alienates our friends”, according to the former president Jimmy Carter. He said America was “abandoning its role as a champion of human rights”, and called on Washington to “reverse course and regain moral leadership”.
‘Revelations that US officials were targeting people including their own citizens abroad were “only the most recent disturbing proof” of how far such violations had extended, he wrote in the New York Times. At a time when popular revolutions were sweeping the globe, the US should be strengthening, not weakening, “basic rules of law and principles of justice”, Carter said.’
‘Carter said: “Despite an arbitrary rule that any man killed by drones is declared an enemy terrorist, the death of nearby innocent women and children is accepted as inevitable. After more than 30 airstrikes on civilian homes this year in Afghanistan, President Hamid Karzai has demanded that such attacks end, but the practice continues in areas of Pakistan, Somalia and Yemen that are not in any war zone. We don’t know how many hundreds of innocent civilians have been killed in these attacks, each one approved by the highest authorities in Washington. This would have been unthinkable in previous times.”
http://www.guardian.co.uk/world/2012/jun/25/jimmy-carter-drone-strikes?newsfeed=true
What say you, goon squad?
What say? That we expect nothing less from the Nobel Peace Prize president!
We don’t know how many hundreds of innocent civilians have been killed in these attacks, each one approved by the highest authorities in Washington. This would have been unthinkable in previous times.”
Again, what liberal hogwash.
Vietnam, how many villages were wiped out? How many civilians killed? According to Wikipedia:
figures for North Vietnamese civilian dead range from 50,000[1] to 182,000 as a result of US bombing.
How many civilian deaths in WWII? Again from Wikipedia:
Civilians killed totaled from 40 to 52 million
How many civilian deaths in the Korean war? Wikipedia says:
Between some 245,000 to 415,000 South Korean civilian deaths were also suggested, and the total civilian casualties during the war were estimated as 1,500,000 to 3,000,000
How about Bosnia? Again from Wikipedia:
The figure of 200,000 (or more) dead, injured, and missing was frequently cited in media reports on the war in Bosnia as late as 1994
How about the Iraq war? According to Wikipedia:
105,052 – 114,731 violent civilian deaths.
War is messy, people die. That is the nature of war. To try and create a liberal meme that the drone strikes and NATO air strikes are killing too many innocent civilians in Afghanistan is to ignore the statistics of war throughout history.
“To try and create a liberal meme that the drone strikes and NATO air strikes are killing too many innocent civilians in Afghanistan is to ignore the statistics of war throughout history.”
I didn’t read it that way at all. He was speaking in the context of national security, saying that we are killing “in a way that “abets our enemies and alienates our friends”, while calling on Obama to “reverse course and regain moral leadership”.
Yes, he is wrong when he says that this would have been unthinkable in previous times. It was thinkable and it was done.
Funny how touchy the left gets with some movies.
However - Micheal Moore is a saint and only makes documentaries.
Same with Al “I can’t even win my home state” Gore…
I have not watched any Michael Moore movie all the way through, even for free on cable. I have seen bits and pieces as I walked in and out of the room while family members were watching. Neither have I seen Al Gore’s masterpiece.
Michael Moore’s movies had interviews with real people affected by the issues he was promoting. I remember the sequence about the Detroit woman whose 6 year old child took a gun to school and killed a classmate while she was commuting to a welfare-to-work job. Tragic.
Michael Moore is not a saint and has a definite bias. I would classify some of his movies as documentaries.
I do not expect to watch a speculative, fear-mongering movie about what might happen if Obama is re-elected. Does it contain any factual information? Or is it along the lines of “It Could Happen Tomorrow” series on The Weather Channel? I might catch it when it gets to cable, if I have nothing better to do with a couple of hours.
Disclaimer: I do not watch many movies and have seen only a handful in theaters since my children were born (28 years ago). Most of the ones I have seen in theaters were children’s movies.
“Same with Al “I can’t even win my home state” Gore…”
Do you foresee Romney winning Massachusetts?
Ah, the calurker who thinks everyone who disagrees with the Democratic party or Obama is a blog troll…
Tell me, what exactly have you contributed in terms of the conversations on this blog? I’ve been posting here since about 2007 and other than the few posts of late regarding “concern trolling”, I don’t seem to recall any posts you’ve made. Of course, your tag is calurker. Are you trolling for trolls?
No, but a friend did last weekend and I intend to see it as well. Why?
I hear its a documentary about Obama’s upbringing and it shows why he is what he is. I have also heard that it’s fair and can be viewed by people of all political persuasions.
No, it is Dinesh D’Souza hypothesizing that Obama’s father, a man he met once after babyhood, was the overwhelming huge influence in his life and that everything he does is to destroy the US because he thinks the US is a colonial power and that this is bad.
Like I said, sci-fi…
Anyone who would go watch a documentary on a candidate in the middle of election season is pretty narrow minded IMO…Do you really think these are for the purpose of seeking truth or are you looking to reinforce what you already believe to be true…
Dinesh d’Souza is a creationist hack. His political reasoning is similarly disassociated from reality. I can’t wait to see the movie at some midnight showing in WeHo.
How Alinsky of you.
WeHo? West Hollywood? Something else?
Yep. Famed for ironic cultist movie audiences complete with costumes, make-up, props, and chanting along with the screenplay. See: Rocky Horror, The Room, et al.
I havn’t seen the movie, but did some reading on it, seems like D’Souza is projecting his own world view and ‘blame everything on the colonist’ mentality onto Barack.
Lip, one of the HBB’s several resident GOP mouthpieces, was advertising it recently, while failing to note that it was “the anti-Obama movie.”
I’m not all that big on sci-fi flicks.
Hey, Bear. Can you post whatever links RAL was referring to yesterday? He said that you posted links to Census data that supports his assertion of 25 million empty excess housing units. Do you remember posting anything like that or anything that in his…um…enthusiasm, he might have interpreted like that?
Thanks.
How long are you going to whining for someone to do for you?
It’s actually 27-28 million empty houses but when we’re talking that many houses, a million or two is a distinction without a difference.
If he repeats it often enough, it must be true
The movie that claims Obama harbors anti-colonial beliefs he inherited from the father he barely knew?
What could be more un-American than being anti-colonial? What would our Founding Fathers think? They loved being a British colony.
Wait, is this about genetic memory? That would be very cool, except the anti-colonial beliefs of the father would have to be aquired traits at some point in the chain, and people who understand evolution know that aquired traits aren’t inherited. Darn, just another person who needs to head back to 9th grade bio class.
His mother did it to him.
and people who understand evolution know that aquired traits aren’t inherited.
Actually, there may be evidence that acquired traits can make an impact on the genetic makeup of the offspring. See here.
Our understanding of science is constantly changing, so that 9th grade Biology lesson you mentioned might be a bit out of date with the most recent theories…
Rats and mice, only looking at mothers (if you want to separate genetic from other influences using fathers is a much better way to do it), and related to being able to develop a better memory or exhibit certain instinctive behaviors.
This is supposed to mean that a human being can biologically inherit a very specific political attitude from a father he didn’t know?
It is simply evidence that may begin to support what was hypothesized previously, that is Lamarckian Evolution.
This is supposed to mean that a human being can biologically inherit a very specific political attitude from a father he didn’t know?
As I said, science is constantly changing because our understanding of it is constantly changing. Mostly it was to refute your comment that “anyone who has taken 9th grade biology should know that”. The reality is that much of what you and I learned in 9th grade biology and other subjects is now out of date.
I thought they were Dreams from his Father.
i have not.
I said there are 5-10 million excess, empty houses. Response…
” Comment by Roberta Arribas
2012-08-27 18:21:22
No. There are 21 million excess empty houses.”
My counter. Please define “excess”.
When I look that word up in the dictionary, it says that “excess” means the amount above normal. So, if it is normal to have 10 million empty houses, and there are currently 19 million empty, then the excess empty is 9 million, not 19 million.
People claiming 21 million or 25 million excess empty houses may as well be saying, I do not care about the truth, I’m only interested in perpetuating a myth.
Sometimes I suspect it is a sociology, psychology experiment to test meme theory.
http://bigbangtrans.wordpress.com/series-4-episode-20-the-herb-garden-germination/
Amy: It’s not surprising that the story has captured the attention of our little circle of friends. Are you familiar with meme theory?
Sheldon: I’m familiar with everything, but go on.
Amy: Meme theory suggests that items of gossip are like living things that seek to reproduce using humans as their host.
Sheldon: I’m no stranger to memetic epidemiology. At Johnson Elementary School, the phrase Shelly Cooper’s a smelly pooper spread like wildfire.
Amy: I should think so. That’s gold.
Sheldon: Your meme hypothesis does intrigue me. How might we examine this more closely?
Amy: Do you have any ethical qualms regarding human experimentation?
Sheldon: It’s one of the few forms of interaction with people that I don’t find repellent.
Amy: We need to fabricate a tantalizing piece of gossip.
Sheldon: And a second non-tantalizing piece to use as a control.
Amy: Then we’ll track its progress through our social group and interpret the results through the competing academic prisms of memetic theory, algebraic gossip and epidemiology.
Sheldon: Look at you, getting me to engage in the social sciences. You’re a vixen, Amy Farrah Fowler.
Scene: Penny’s door.
Penny: Oh, hey, Amy. What’s up?
Amy: Sheldon and I engaged in sexual intercourse. In other news, I’m thinking of starting an herb garden. Mum’s the word. Gotta go.
Next day:
Amy: Bernadette just asked about my sexual encounter with you. The meme has reached full penetration.
Sheldon: Pun intended?
Amy: No. Happy accident.
Sheldon: This is remarkable. Took less than 24 hours.
Amy: I should let you know that she asked for details about our dalliance.
Sheldon: Interesting. So it went beyond the mere fact of coitus to a blow by blow, as it were.
Amy: Pun intended?
Sheldon: I’m sorry. What pun?
There are 25 million excess empty houses, and even if we were to totally stop building today, it would take 6 years to work off the excess inventory….
Then sit back and laugh at people as this obvious pile of bad math coupled with sheer ignorance perpetuates across the internets like Pwned, fail and bunch of loosers have gone before….
DarrylTheLiar
The number of excess empty houses is actually 28 million. But a few million either way are a distinction without a difference.
So why are you here lying Darryl?
Are you sure it is 28 million? 32 million sounds like a better number. After all, it is common knowledge that vacancy rate is 15% and there are 300 million houses, and 32 million is 15% of 300 million.
Why are you lying about it darryl?
This is awesome — kudos Darrell.
I think 32 million sounds nice.
This is a link to an “interactive” chart, though I can’t see what is so interactive about it. You can move the date line around so it tells you the number at the time you pick. I’m linking to the 5 year version, but if it defaults back to a shorter time, you can click it back.
http://www.bloomberg.com/quote/HOWNVAC:IND/chart
The title is:
Vacant housing units for sale or rent or seasonal or other in thousands
Add to Portfolio
HOWNVAC:IND
18,518.00000
As of 06/30/2012.
Now, I don’t agree with Darryl’s insistence that an amount is only “excess” if it is above the average percentage of empty units. I think that the amount is excess if it is above the lowest amount you could expect to have since anything above that is what you could reasonably expect to have sold. The fact that there is an average doesn’t mean we are always going to have that average. For example, if you are in a time of very high construction, there will be probably be more empty units just because they may be certified for occupancy (and become “empty units”) before there is any chance they will be actually ready to be sold. I don’t know what the minimum percentage of empty housing units out of the total is. Like I mentioned yesterday, I can’t ever recall there being less than 2% available rental units in NYC and that is low enough to let landlord raise rents a lot. But NYC has a much higher percentage of units for rent than the rest of the country and I expect it takes a lot less time to turn over a rental than it takes to turn over an owned unit.
And, of course, there are some of the units in the chart that are owned by people who simply have more than one unit and plan to keep it that way for the foreseeable future. Those units are irrelevant in looking at future liquidation of inventory because they aren’t part of inventory.
It seems a silly discussion. Unoccupied houses are not part of inventory unless the owners intend (or will soon be forced) to sell them. Those in “inventory” are not excess unless they exceed reasonable forward demand. There is no way to tell how many excess houses there are from census data.
It should be enough to know that unimaginable excess inventory must follow the end of the biggest building mania in history, and that the crushing downdraft is inevitable.
Why is it unimaginable? I can imagine something between 10 million and 18 million.
Broaden your ImagineNation by another 10 million.
Sorry to be obscure. There are numerous macro economic vectors in a strong downward long term trend. There are no significant trend reversing factors in sight.
The majority of families in the country have been living a magical life for decades, beyond their means. Means are steadily going down. There will be more properties offered for sale than you are imagining, is what I meant.
Sorry. Darrell.
The dictionary does give some wiggle room for the definition of excess in that it can be the amount above normal or desirable or targeted level.
The point that those claiming 25 million excess empty houses are trying to make is that this excess supply, if allowed/forced to come to market, would crush prices.
If we look at the vacancy rates of the 50s, 60s, 70s, 80s, then the amount of vacancy was not sufficient to crush prices. It wasn’t even enough to cause flat prices. The “average” vacancy rate was a level that caused slowly rising prices
That is the level of vacancy that I’m using as a “normal” level. You point out that it doesn’t always have to be that high. True, but it doesn’t have to be that low either. We could just as easily say that excess is the amount above the level needed to cause flat prices, meaning the excess is just the amount forcing down prices. This flat price number is above the historical average.
So, yeah, I guess there is some room for the definition of “excess” when speaking in relation to the level of vacancy needed to cause price declines.
Is excess the amount above the bare minimum needed to prevent skyrocketing price(your unknown number)? Is excess the amount above historic level that caused steady increasing prices as we had for the 50 years before the bubble(10 million ish)? Is excess the amount that is above a normal equilibrium that causes flat prices(a larger, just as unknown number)?
I think where you and I agree are 1) not every empty house and not every vacation home and hunting cabin is an “excess” empty house. 2) the number of excess empty houses is something much smaller than 25 million.
I think where NO ONE here disagrees is that we way overbuilt, it will take a long time to work off the excess houses, and if all those empty housing units came to market at the same time, it could/should really crush prices.
Darryl,
All your verbal diarrhea and obfuscation won’t change the fact that 28 MILLION excess empty houses are awaiting to be liquidated.
And ontop of that, another 35 MILLION excess empty houses are just getting added to the excess inventory as boomers are just beginning to die off.
There is no sense buying a house in an environment of falling prices and excess inventory. It’s financial suicide.
Why do you want people to commit financial suicide?
“And ontop of that, another 35 MILLION excess empty houses are just getting added to the excess inventory as boomers are just beginning to die off.”
Because the generation born 20 years ago, that is just as large as the Boomer generation, won’t be forming households, and won’t be moving into a single house….. Really?
Call me a liar, but I’ve frequently pointed out how the current demographic momentum of adding 1 million households a year will be ending within the next 10-15 years when the Boomers begin their great die off.
I’ve also pointed out how our current construction rate of 700K housing units a year, less than a third of peak construction rates, is still unsustainable high. Construction can not be a sustainable source of new jobs for the economy, and will not be leading a sustainable recovery.
Darryl,
Population growth in the most recent census is the lowest in US history.
Secondly, the “echo boom” cohort is SMALLER than the baby boom cohort.
Thirdly, the long term US birth rate is in decline and has been for 65 years.
You say “call me a liar but”…..
If not a liar, what? A serial misrepresenter? A teller of tall tales? Given the fact you’ve misrepresented the truth once again, what would you like us to call you?
“I think where you and I agree are 1) not every empty house and not every vacation home and hunting cabin is an “excess” empty house. 2) the number of excess empty houses is something much smaller than 25 million.”
That is where I am so far. I still could be pursuaded if he could actually post a link to real data “finding” another 10 million empty houses not included in the Bloomberg data, though “or other” seems to indicate it would be very hard to do. But I can’t entertain the idea until I get data. And he doesn’t seem to like data.
A Rational Discussion of the Federal Budget
We are not yet Greece, but we are not exempt from the same rules of arithmetic that eventually caught up with Greece. We just have a little more time. The only question is whether we will use that time to make politically difficult changes or whether we will just kick the can down the road, and keep pretending that “Medicare as we know it” would continue on indefinitely, if it were not for people who just want to be mean to the elderly.
It is today’s young people who are going to be left holding the bag when they reach retirement age and discover that all the money they paid in is long gone. It is today’s young people who are going to be dumped over a cliff when they reach retirement age, if nothing is done to reform entitlements.
http://www.realclearpolitics.com/articles/2012/08/28/entitlement_reforms_115224.html
The Romney team wants to make the difficult choices while the Obama team wants to kick the can down the road. What do you choose?
Bottom Line
Entitlements take up 55% of the federal budget and are growing
The military takes up 20% of the federal budget and is stable or shrinking
The federal government borrows 40 cents of every dollar it spends.
‘Grover Norquist, the influential conservative activist, recently made some very frank and sobering remarks about the U.S. military budget. Unlike many conservatives, Mr. Norquist understands that American national security interests are not served by the interventionist foreign policy mindset that has dominated both political parties in recent decades. He also understands that there is nothing “conservative” about incurring trillions of dollars in debt to engage in hopeless nation-building exercises overseas.’
‘Speaking at the Center for the National Interest last week, Norquist stated, “We can afford to have an adequate national defense which keeps us free and safe and keeps everybody afraid to throw a punch at us, as long as we don’t make some of the decisions that previous administrations have, which is to overextend ourselves overseas and think we can run foreign governments.”
He continued: “Bush decided to be the mayor of Baghdad rather than the president of the United States. He decided to occupy Iraq and Afghanistan rather than reform Fannie Mae and Freddie Mac. That had tremendous consequences….’
http://original.antiwar.com/paul/2012/08/20/military-cuts-dont-believe-the-hype/
The key word here is conservative. True conservatives aren’t into playing world police.
The reality is that neither republicans nor democrats are going to do the right thing. The war in Afghanistan has continued under Obama. The war in Iran will take place regardless of who is at the helm, it’s already baked in.
Regardless of who your favorite puppet is, you have to come to grips with the fact that our politicians and whole political system has lost its way.
Classic True Scotsman logical fallacy. Create the definition to be whatever you personally want the definition to be, then exclude people for not meeting your personal definition.
I believe the founders were quite conservative and they warned us about putting our noses where they didn’t belong.
“I believe the founders were quite conservative”
How you figure that???????
Throwing out the king? Congress shall make no law regarding establishment of religion? Freedom of the press? No cruel or unusual punishment? Secure in your person and property from unreasonable search and seizure? Fair and speedy trial?
There were plenty of radically liberal (for the time) ideas in there. Heck, those guys were down right radical liberal hippies for their time.
“How you figure that???????”
He means conservative in the use of military. The isolationists of our pre-WW2 era could be seen the same way.
I agree with you.
It still does not change these facts:
Entitlements take up 55% of the federal budget and are growing
The military takes up 20% of the federal budget and is stable or shrinking
The federal government borrows 40 cents of every dollar it spends.
I presume that you are including social security and medicare in your entitlements basket.
Being that they are funded via the payroll tax (except for the unfunded prescription freebie Bush gave to seniors and the temporary SS partial tax holiday) they don’t contribute to the deficit at this time.
Take those two out of the equation, and the percentage that we borrow, which now is to pay for mostly non entitlement programs (such as the military), becomes much , much higher.
Sorry - you have answered INCORRECTLY.
“Payroll taxes” are ALL dumped into the general treasury with the rest of the taxes collected. You can thank the democrat president LBJ for this to cover the true cost of the Vietnam War.
There are no “private accounts” or lock boxes for the “payroll taxes” you are so dreamy about. ALL THE MONEY has been SPENT. We do have some IOUs for ya!
So you can’t take them out of the equation!
No democrat talking point cookie for you.
No, that is incorrect. The payroll tax is intended to fund SS and Medicare. Any surpluses are invested in US treasuries and are not merely dumped into a general fund as you imply. You might argue that those treasuries will never be repaid, but investors worldwide disagree with you as they purchase over a trillion $ worth of new treasuries each year.
We do have some IOUs for ya!
Funny, when treasuries are held by SS, they are IOUs, with the implication that they are worthless. Yet the Treasury has no trouble selling them to investors for cold hard cash.
The SS “Trust Fund” has a balance of 2.7T as of present. It is worth noting that these treasuries will be converted into cash over a period of about 20 years, and not in a single fell swoop, at an average rate of about 120 Billion per year.
No democrat talking point cookie for you.
You can keep your cookie. I’m not a Democrat and never have been one. I was a Republican for over 20 years though.
Entitlements take up 55% of the federal budget and are growing
The military takes up 20% of the federal budget and is stable or shrinking ??
Your math is wrong 2fruit…The Military is as much a entitlement program as any we have so, if you want to say that entitlements take up “75%” of the budget I will agree with you…Now the question is, how do we rein-in entitlements in a way thats balanced because, leaving the military entitlement off the table is BS…
I have to agree, the military has been involved in way too many operations abroad. And for what??
I say bring them all home and put them on the borders, especially the southern border.
I say northern boarders, too. Way too many Canadians are buying American houses.
American houses are for US Americans only!
No need to guard the borders. Just fine the crap out of businesses that hire illegals. With no jobs they’ll self deport.
Of course the Chamber of Commerce won’t have any of that.
‘No need to guard the borders. Just fine the crap out of businesses that hire illegals. With no jobs they’ll self deport.’
We need to do both. Obviously, we should be tight enough on the border to prevent drugs and terrorists from entering. However, employee sanctions are the most necessary. California was a much better state until its employee sanctions were struck down.
“Bush decided to be the mayor of Baghdad rather than the president of the United States. He decided to occupy Iraq and Afghanistan rather than reform Fannie Mae and Freddie Mac. That had tremendous consequences…”
Such as playing very handily into the GOP’s ‘blame Obama for everything Bush did’ game.
Obama has plenty of blame for not taking care of the Bush mess that he promised to take care of.
Wow….Nice post Ben….Makes me think I need to take a fresh look at the man…Although I still think a “pledge” is rather stupid for a legislator that needs to come to consensus or we end up with what ??
Sequester…
The Romney team wants to make the difficult choices
You sure about that? People say a lot of things during a campaign…
Even Obama talked about making difficult choices. All talk, no action.
“The only question is whether we will use that time to make politically difficult changes or whether we will just kick the can down the road,”
Oh no… there are DEFINITELY other questions!
Like, how can we be adding new money to the economy at a rate of 8% of GDP every year, and not have a run away inflationary environment? Where is the money going, and what would happen if we stopped pumping that money in?
Why would it be better to phase in any proposed cuts rather than just make them effective right now? I hear “we paid in”. Yeah, and those under 55 are paying in even more! I hear that the younger people have longer to plan. Sure, but planning does change the paradox of thrift that dictates that it is impossible for everyone to be spending less than they earn, accumulating money.
How come Republicans never want to talk about total debt, including public and private sectors, that has been growing at 3x the sustainable rate for 30 years since the Regan Revolution deregulated the banking sector? Why is government debt so much more dangerous than private sector debt? Isn’t the government on the hook for the loss, via things like FDIC and FHA, for most of that private sector debt? Why all the focus on only the public sector debt? Why are we afraid of “Greecing” and not afraid of “Spaining”?
(For those that don’t understand the last, Greece’s trouble is its government deficits, while Spain’s big problem is the need for government to bail out its banks.)
And, of course, the MOST important question of all. Exactly what will Republicans do, and when, should we hand them all 3 houses? Will they make a promise to cut the deficit to a certain level by a short-term target date, and expect themselves to be voted out of office if they fail to meet the commitment they make to voters? I want SPECIFICS! And, no, not specifics like Romney’s “cut waste in half”. HOW? Or Ryan’s plan to balance the budget, in 2052, after most of the Boomers have died.
Exactly what will Republicans do, and when, should we hand them all 3 houses?
1) Cut taxes for the rich
2) Take away deductions from the middle class
3) Start another war
We are not Greece and will not become Greece in the near future
1. We have a printing press
2. We have massive natural resources
3. We have the #1 military in the world
4. We have the largest economy in the world.
5. Due to all of the above and the fact that everyone else stinks worse we are considered a safe haven.
Medicare is more efficient than you private insurance plans. It is better too. All we need to add is some cost controls like they have in Britain and we’d be paying thousands less a year. Instead the GOP plan is to hand out vouchers that don’t keep pace with inflation and let the sharks in the insurance world continue to feed on what’s left of the middle class.
But we have 16+ trillion debt and unlike Greece we do not have anyone to give us handouts when we do crash. Take away the reserve currency and we are toast.
Speaking of debt Barrons (August 27 issue) has a very interesting story about state debts. The worse state is Conn. which also has started to have a new housing crash. Its debt to GDP is 7.9% and combined with its unfunded pension liability it has a liability of 17.1%. Illinois is second worse with a combined liability of 16.1. The best state is South Dakota with a debt to GDP 0.7 percent and unfunded pension liability of 0.3% for a combined liability of 1%. I think only people from South Dakota should vote in the next election since they seem to be the only people responsible enough. P.S. California is not as far down on the list as you might imagine with a total of 6.8% but then again not so long ago it was a fiscally conservative state. It usually takes decades to build such a debt.
Yes, $16 T in debt and with unfunded liabilities that are estimated to be “$144 trillion, roughly $1.2 million per taxpayer”
http://investmentwatchblog.com/total-us-unfunded-liabilities-are-estimated-at-144-trillion-roughly-1-2-million-per-taxpayer-was-that-a-pin-dropping/
Case in point, in Illinois, my dad retired from the State Police and he’s getting worried about his pension. It was a sweetheart deal, retired when he was 52 at about 75% of his salary, but the sweetness could turn sour in the future.
How many thousands of our senior citizens are facing this fear?
Thousands? Try “millions.”
I think only people from South Dakota should vote in the next election since they seem to be the only people responsible enough.
And let rednecks run the country? I’d rather run it into the ground first.
So according to this blob the people of South Dakota are rednecks, didn’t they elect McGovern to the Senate but most Muslims are reasonable? Well aren’t we just so PC. The vast majority of muslims in the middle east think that anyone that converts from Islam should be put to death. Pew research confirms this. I don’t think that very many people in SD think anyone should be put to death for anything but murder but they get the harsher words.
To go along with my comment when it posts:
http://www.examiner.com/article/pew-poll-most-muslims-favor-law-to-allow-islam-stoning-amputation-death
Calibrate your sarcasm meter, I’m from Wyoming :-).
The Cheapest Generation
Why Millennials aren’t buying cars or houses, and what that means for the economy
By Derek Thompson and Jordan Weissmann
http://www.theatlantic.com/magazine/archive/2012/09/the-cheapest-generation/309060/?single_page=true
Odd article about Gen Y and what they will or won’t buy. They seem to think that people are going to spend money on education rather than houses. How does that work? Most people are done consuming a lot of education by the time they are in their mid 20s.
The $1 trillion student loan number should be the stake in the heart of the NAR lie about “pent up demand”
Because an average new car is $40,000 and housing is insanely priced in many markets?
Because property taxes are insane (thank you public unions) and gasoline prices are at record highs?
Because an average new car is $40,000 and housing is insanely priced in many markets?
Because property taxes are insane (thank you public unions) and gasoline prices are at record highs?
And wages have gone down in the past decade. Inflation adjusted we are way down.
Because an average new car is $40,000
More like mid to upper 20’s. But still out of reach for most student loan strapped young pups. It’s much cheaper to fix the hand me down car mom-n-dad gave them while in college.
That you don’t understand this is remarkable.
All that I can surmise is that either you’re a 1%er or work for the government in some capacity. Perhaps both.
I understand the economic pressures behind the presentation. What I don’t get is the second part where the authors think that the economy will be OK because the Millennials will spend plenty of money on education and that will be enough. Sounds to me that they are saying that people will go into massive debt before they turn 30 and then become marginal members of the economy, unable to make traditional purchases and working to pay for student debt and smart phones.
They could very well be correct, depending on the definition of “okay”. An ‘okay” economy doesn’t equate to a “good” economy. This country could see its standard of living decline a further 50% and still be “okay”. That doesn’t mean it would be a good or desirable economy, however.
They could call the economy of the future “non-destitute” deem that as “okay”.
Where the authors fall short is assuming that a well-educated population is a well-paid population. That is increasingly not true. And a well-educated population in hock up to its eyeballs for two decades+ with nothing to show for it could be a serious problem for those in power. Kinda like what we’re just now starting to experience.
And I experienced the “lite” version of it 20 years ago. Graduated with student loans and lived at home for two years to pay them off and pay off the car that I had to buy to get to the jobs that paid for student loans. Actually took on a second job to buy a few extras because I felt guilty living with mom and dad and not paying off the loans as quickly as possible. Applied to and went to grad school and came out with mega loans, but the old version of mega loans was still a bit less than one year’s salary, so I managed to pay them off in 3 years - only possible because you could still find an affordable studio in NYC back then. Got through a few years of lay offs in the last recession but had savings by then. I am perfectly aware that if any of the good factors hadn’t worked out - from mom and dad not living in an area with jobs to the recession that cost me my position happening a little earlier in my career to not being able to find a cheap rental in NYC - I would have been in big trouble. The kids graduating these days are, on average, in a terrible position.
What is the number again? 30% of waitresses and 50% of bar tenders have college degrees? Something close to that.
Looks like we’re pretty much on the same page, polly. You got lucky…and apparently worked hard to perserve that luck. As it should be.
I hope that the United States very soon suffers the full-blown economic meltdown - whatever that means. The sooner the better as far as I’m concerned.
To have the real meltdown hit after yet another 3-6 years of the all-out b.s. that’s going on now would be a disaster, and not just for Xers and Millenials who are going to get reamed no matter what.
I’m honestly not sure that 3-6 years makes that much difference. It means that there are more people with debt - student, mortgage, etc., whose live will be impacted if “the big one” hits but we have enough of those already for the consequences to be very, very, very bad.
That being said, I am glad to have my lease for next year locked in at only a 3% increase and I am an expert at free and low cost entertainment. Cooking tonight, but there is all sorts of interesting stuff for the rest of the week and/or weekend.
Indeed. Economically, 3-6 might not make that much difference.
Psychologically, it might make a great deal of difference. Humans don’t fare to well during long, decades-long bouts of constant scrounging and worry over what will happen to them next. I would wager that this is especially the case in cultures such as ours, built on freedom of lawful pursuit.
Deep psychological distress could prolong/deepen the severe economic crisis that is going to happen soon.
Witness Eastern Europeans from 1914 to 1989. Wanna live that nightmare?
My anecdotal observation of “millenials” is:
1) The ones with good paying jobs have a nice set of wheels. Some, but not all, buy property.
2) The ones stuck in lucky ducky jobs drive beaters or where it’s practical take public transportation. And they are legion.
My take too. A few GenY I work with have incomes north of %70K a year. They buy cars, houses, get married, have kids.
My eldest daughter scrapes by on a couple minimum wage jobs, drives a beater, rents an apartment.
My second daughter has a “somewhere between there” income. Has nice cars, but rents.
Third daughter is still in college. Unfortunately, she’s getting her BS in biology, so she’s going to need to continue to at least a masters before she’s really employable.
“The Taliban were originally sponsored and trained by the State Department to tweak the Soviets in Chechnya.”
ahansen, this is something you may appreciate:
The Looking Glass War
Sept 17th, 2001
Berkeley CA
“Somehow it seems to fill my head with ideas—only I don’t exactly know what they are! However, somebody killed something: that’s clear at any rate–” exclaimed Alice after reading Jabberwocky in the Looking Glass world.
It is a fair description of what the situation appears to be in the US after last week’s terrorist attacks.
…
“The Taliban were originally sponsored and trained by the State Department to tweak the Soviets in Chechnya.”
She is completely wrong on this. The US sponsored and trained the Mujahideen, a resistance movement composed of local warlord tribes aligned against the pro-Soviet Union government. Those tribes did not become the Taliban, though there is some evidence that Al-Qaeda and Osama Bin Laden had it’s origins there.
The Taliban originated as a Pakistani religious sect that gained prominence after the Soviets left and was supported by Pakistan and Saudi Arabia, to further their influence in the region. The US had no diplomatic relations with the Taliban, nor were they ever supported by the US directly. From the start, the Taliban’s power has centered in Pakistan.
Wrong again, NE.
Representative Dana Rohrabacher both championed the Taliban in the US House in the 1990’s and was instrumental in bringing them direct and material support– offiCIAially acknowledged or not. He made numerous trips to Afghanistan for the State Department and was widely seen as the House expert on Afghan military affairs. In fact, the day after Massoud was assassinated, he scheduled an urgent meeting with Condoleeza Rice to warn her something big was coming. They had to cancel it, though. 9-11, you see.
Nice try with the neocon propaganda machine, though.
Here’s your wiki:
http://en.wikipedia.org/wiki/Dana_Rohrabacher
and here’s your search blurb:
“Rohrabacher voiced support for the Taliban when they seized power in the 1990s, visiting Afghanistan…”
Pax
To clarify:
“…Those tribes did not become the Taliban,…”
Yes they did. The Taliban was composed of Mujahadeen in opposition response to the predations of the American-financed warlords. And Al Quaeda derived from the Taliban.
Think “Tea Party” (which had libertarian and progressive support in its origins) as an offshoot of the Republican Party. Think Osama bin Laden as the Koch brothers venture capitalist of the movement.
Speaking of experiments, I truly hope the Republicans win this election. I hope they hold the house, take the senate and the White House.
Call it an economic experiment to test my theories.
I want to see if the Republicans truly can cut the deficit while lowering taxes on the and without touching DoD or entitlements for those already over 55, allow house prices to crash without stepping in with banking industry bailouts, undo QE and bring up interest rates on savings, while creating millions of jobs, and bring us back to the gold standard….
If my understanding of macroeconomics is correct, than with the private sector still tapped out, the Republicans should fall flat on their face attempting to get the rich even richer while at the same time slowing the rate at which the federal government is pumping new debt/money into the economy and without some trick to push more debt into the private sector. If they can actually do it, then I’ll admit I was 100% wrong on economics.
I do not see how they can let the price of the asset that backs up some $13T in debt crash, without making every bank in the world insolvent, or how that insolvent banking system would permit the global economy to continue to operate at a level ANYTHING CLOSE to where we’ve been. Maybe I’m wrong. Maybe house prices on the national level could fall 50%, banks could eat $5T in losses, and just keep on going as if nothing changed. I doubt it. If it happens, then I’d have to admit I was 100% wrong.
Go back to the gold standard without first ending free trade and returning to a 1950s tax code with a 90%+ marginal rate? I’d love to see them make that work, when at current market price, all the gold in Fort Knox wouldn’t even cover 4 months of our international trade deficit.
Maybe I don’t get economics, and maybe the Republicans can pull off all the things their supporters seem to think they can. I’d LOVE to see them try.
More importantly, I want to see Republicans go on the record with what the actual results will be. Romney, in the debates, PLEASE make a commitment on what the 2010 deficit will be under your presidency! Please commit to how many millions of jobs will be created in your first 2 years, and how low the unemployment rate will be.
I truly want to see Republicans promise to execute their Cut, Cap and Balance plan… and to implement it within their first 2 years of controlling all 3 houses… Get the Democrats to sign on, to afree to do whatever the Republicans ask for to “get ‘er done” in those 2 years….
Now that would be fun!
When Obama was running in 2008 I was all like, be careful what you ask for. Ditto for Reps in 2012. Put them in charge, and let’s see them “make it work” as Tim Gunn would say.
Then in 2014 and 2016, we can sweep the Dems back into office, only to have them fail to fix it too.
Because guess what. I’m not wrong on the underlying macroeconomic root causes of our problems, and no one even wants to think about the changes needed to fix them. Everything you’ve been told by politicians for the last 60 years was a flat out lie! The politicians are not going to admit that, nor be able to reverse course.
You must not remember the 1980s.
Reagan cut taxes
Revenue to the government doubled
A democrat congress spent it ALL and more.
Did I miss anything?
Come on 2banana, they didn’t do it on their own. Remember “Star Wars?”
Are you talking about the reform in 1986? This was intended to be revenue neutral, in other words, cut out loopholes in conjunction with lowering tax rates.
The same thing is needed now, except unfortunately, even with reasonable cuts, we can’t afford for it to be revenue neutral.
Which of the following reforms do you think could get through Congress? Remember to consider who benefits from each one.
Eliminte the morgage interest deduction
Tax all employer provided insurance to all employees
Eliminate the charitable deduction
Eliminate tax exemption of charities (and all other tax exempt entities while you are at it)
Eliminate deduction for health care costs over 7.5% of AGI
Eliminate deduction for business expenses not covered by employer (small business still only taxed on profits) over 2% of AGI
Eliminate deduction for all flexible spending accounts
Eliminate additional child deduction/credits except for the standard exemption.
Eliminate all tax preferences for retirement savings (no deductible IRAs, no 401(k), employer match of 401(k) contributions currently taxed, income earned in a Roth taxed as earned, no tax deferal for deferred income for executives, etc. - basically turn all these accounts into currently taxed savings/investment accounts
Eliminate tax benefits of the child school/college savings accounts
Eliminate tax-free bonds
Eliminate preferable rates for capital gains
Eliminate first $250K tax free for sale of residence for 2 out of last 5 years
Eliminate earned income tax credit (sorry St. Ronnie)
Eliminate corporate R&D credit
Eliminate accellerated depreciation deductions of capital purchases.
Eliminate any amortization of purchases of capital assets - you wait to “deduct” the purchase price until you sell it
Eliminate carried interest rule
Well, you get the idea, though I’m sure someone could come up with more. How many of these could happen? How much can you reduce rates with those eliminations and remain revenue neutral?
Plenty of sacred cows in there. We need to have a big BBQ.
Simpson Bowles has a few options:
Highest marginal rate of 23%, with the elimination of all tax expenditures (making capital gains equal to ordinary income as well).
24% if they keep EITC and Child Tax Credit.
Their plan was 28%, keeping a number of things, but still making ordinary income equal to capital gains…check out page 31 here:
http://www.fiscalcommission.gov/sites/fiscalcommission.gov/files/documents/TheMomentofTruth12_1_2010.pdf
Oops. Forgot one.
Eliminate deduction for state income taxes (or the alternate sales tax deduction)
I’m sure there are others I missed.
eliminate AMT
eliminate tax on interest income
Reagan cut taxes
Revenue to the government doubled
You might want to look at the national debt charts at Zfacts. You’ll find your Ronny ran up a massive debt on things the country didn’t need.
You mean politics as usual? No…no…no…couldn’t be.
“Reagan cut taxes
Revenue to the government doubled
A democrat congress spent it ALL and more.
Did I miss anything?”
Yes. What you missed is the result of cutting taxes while still spending pumped new debt/money into the economy, creating stimulus, that resulted in the increase of tax receipts.
We also deregulated banking and lowered the reserve requirements on most loan types from 10% to 3% unleashing private debt to increase at more than 3x the sustainable rate, also pumping new debt/money into the economy and stimulating, therefore, increasing taxes.
Since we did not cut taxes AND cut spending, while maintaining private sector lending conditions, we are unable to isolate the effects of the tax cuts from the massive stimulative effects of deficit spending and unleashing the private sector debt monster.
The 1980s are insufficient experiment to determine the likely economic effect of cutting taxes while slashing government spending, while still up against debt carrying capacity of the private sector, while facing the continued collapse of the housing market and its potential contagion into the banking sector, while the other major global economies are also wrestling with their own peaking or collapsing bubbles, while facing the pending retirement of the largest generation in proportion to their offspring in history, while facing a continues international trade imbalance equal to 4% of GDP…
Regan’s tax cuts were not done in a vacuum, but rather in the context of highly stimulative credit expansion policies.
Romney tax cuts will not be done in a vacuum either, but rather in an environment with lots of pressures to stop and reverse the credit expansion.
Darn those facts.
Reagan raised taxes 11 times. That’s how revenue increased.
He only cut them for the rich.
That spending was the Star Wars program.
So yes, as usual, you missed everything.
Oh, certainly remember the 1980s, when government deficits exploded, private sector debt began skyrocketing at 3x the sustainable rate….
When Regan was elected, each household’s share of total debt was 2.8x median household income. Now each household’s share of total debt is 6.5x median household income.
Regan did NOT bring down deficits without tricks to get private sector debt increasing. He did the exact opposite of these.
Any of the above outcomes will result in more government contractor jobs being created
Be careful what you wish for, but the truth is that human beings are incapable of knowing even what is good luck or bad luck in the short run. I am on travel today and will miss this discussion. However, think of this. Just a week or so ago, I think we would have all agreed that the drought in the Midwest was bad. However, it is only the dry air from the Midwest that prevented Isaac from turning into a Cat 3 or 4 and probably destroying New Orleans. The air that had migrated from the drought regions to the Gulf was pulled into the storm retarding development. Now in a return favor to the Midwest the hurricane will break the back of the drought in the corn belt. God’s plan? One never knows what is good luck or bad luck without the benefit of hindsight.
Sounds like bad luck all around. We need to get people out of the underwater-if-it-rains-hard parts of New Orleans permanently, and another Cat 4 storm right up the gullet might have done it.
Nice ripost, sf.
“Now in a return favor to the Midwest the hurricane will break the back of the drought in the corn belt.”
I appreciate the “power of Mother Nature” theme here, and the sliver lining with the dry midwest air turning Isaac down a notch. But breaking any drought takes a sustained change in storm patterns.
Apologies for the botched HTML, please indulge me with this repost.
The financial sector has had four years and access to unlimited liquidity with which to rebalance their balance sheets.
The US has a looming debt crisis. The S&P fired the first shot with its downgrade last year. If the US backs off its spending cuts, it will almost certainly create more downgrades and spook the markets.
The US can continue to subsidize house prices and Wall Street. And it may. But it is going to have to make some difficult choices about spending going forward.
I truly relish mornings like this one, when emerging data directly undercut the stock market cheerleader message in the Marketwatch headlines:
New York Markets Open in: 0:21:31
Pre-Market Indications
Futures: S&P 500 -0.3%
DOW -0.2%
NASDAQ -0.2%
Stock futures creep higher
Wall Street keeps an eye out for the latest doings in Europe not to mention the price of crude. Case-Shiller and consumer-confidence data are on tap.
US home prices up 2.3%.
http://www.marketwatch.com/story/us-home-prices-up-23-in-june-case-shiller-2012-08-28?dist=beforebell
Maybe this will shut up the “lower interest rate” morons and set us on the course to reasonable rates in the future?
“…reasonable rates…”
…and lower home prices?
Only when defaulted property and REO is excluded are prices up.
Only when defaulted property and REO is excluded are prices up.
I’m not clear why a distressed property which may need tens of thousands [or more] in rehab work would be a similar comp to a non-distressed sale. If you were to take the distressed sale, fix it up, and then sell it, it would be a comp to other non-distressed sales.
Two different markets in my mind.
On the way up, these same needy structures were overpriced and were included in the comps. On the way down, they do not fetch a very high price. Taking them out of the comps hides some of the decline in the overall market. Nothing sells below “market” at arm’s length.
But not every distressed sale is requires a gut and rebuild.
Blue, I can see why a physcially “distressed” house would not be a comp. If a $300K house needs $40K of repair to be habitable, then it shouldn’t drop the price of the good $350K house next door. A financially distressed house is different. In my travels, I saw very few good-condition financially distressed houses.
The condition of a house should be a factor in determining the value of a house, granted. Around here it is even a factor in determining real estate taxes. The best gauge is what someone else is willing to pay for it.
You thnk your place could use some expensive upgrades, does that make it physically distressed? The folks who bought my victorian 8 years ago put about what they paid for the house into remodels, should that house not be a comp?
Blue, I’m talking about imminent habitability issues like mold or wet basements or wood rot or termites or a collapsed floor or a leaking roof or a trashed HVAC system. Many of the houses I saw online “would not pass FHA inspection.”
My own house only had about $500 total imminent issues, leaky flashing and a squeaky dryer, if you can call that imminent. So, no, my house was not physcially distressed and I would count it as a full comp. There are ~$10-15K of other issues, but the house isn’t going to fall down in the meantime.
I guess you also have to be careful about how to calculate a remodel since there are different grades of remodel. If the bathtub is in bad condition, do you count the cost of the new tub on sale at Home Despot, or do you count the expensive refurbished clawfoot tub?* Ditto for the kitchen. I’ve seen ads for kitchen remodels under $10K. That’s just for simple pull-and-replace with stock cabinets and appliances. You could easily spend 6-7 times that to get what you really want.
——————-
*Although, to be a real stickler, for historic homes like Victorians and Craftsman bungalows, you pretty much have to get the expensive upgrades to maintain the period furnishings. To a buyer, a Home Despot tub would probably be worth LESS than having no tub at all.
“Only when defaulted property and REO is excluded are prices up.”
Anna W on The Big Picture
“As I have been saying for some time, this is an apple to orange comparison — pitting a period of high foreclosures versus a period of voluntary foreclosure abatement by the money center banks.
Distressed sales are 20% < less than non -distressed sales. The NAR has reported that the number of distressed sales has fallen from 38% to 26% of the total basket.
Do the math, and this accounts for nearly all of the price improvement.”
http://www.ritholtz.com/blog/2012/08/case-shiller-q1-2012/
Yeah I read that one.
As I’ve said all along. Prices are falling.
Lower home prices will follow higher interest rates. Great if you’re a cash buyer.
It’s great if you are a debtor also, for several reasons. It is not great if you are a seller, especially if you are a failing bank.
Aug. 28, 2012, 9:12 a.m. EDT
Stock futures retain losses on home-sales data
NEW YORK (MarketWatch) — U.S. stock-index futures remained lower Tuesday after a 20-city composite of home prices rose for a second month in June. Wall Street offered virtually no reaction to the strongest back-to-back monthly climb in the S&P/Case-Shiller index. Futures for the Dow Jones Industrial Average were down 23 points at 13,084. Those for the S&P 500 slid 2.3 points to 1,406. Those for the Nasdaq fell 2 points to 2,780.75.
This seems to be a God-sent reminder of one of the last GOP presidency’s deft handling of Hurricane Katrina, just in time for the Republican revelry across the Gulf in Tampa to get into full swing.
Isaac likely to become hurricane, takes aim at New Orleans
Published August 28, 2012
As Tropical Storm Isaac rolls over the Gulf of Mexico toward Louisiana, forecasters say the storm will likely sustain hurricane-force wind by the time it hits the state’s swampy coast early Wednesday.
The forecast track has the storm aimed at New Orleans, but hurricane warnings extended across 280 miles from Morgan City, La., to the Florida-Alabama state line. It could become the first hurricane to hit the Gulf Coast since 2008.
…
‘ a God-sent reminder’
You know, people are almost always killed in hurricanes. It’s really weird that even a storm could be politicized.
“Heck of a job, Brownie” - George W. Bush, 2005
Particularly, when there was a Democratic governor and mayor involved that were primarily responsible for the fiasco. FEMA is only designed to supplement local efforts. The mayor was lucky we were not in China because he would have been shot. Once again an example of people just thinking within the two party system.
In Cantankerous’ world, “thinking within the two-party system” means that one is non-biased.
People have killed for power since time immemorial.
Such silly and hateful statement.
But to liberals - God exits sometimes - just not in the abortion room. And states (especially democrat run states) have NO responsibility for events that happens EVERY YEAR.
This seems to be a God-sent reminder of one of the last GOP presidency’s deft handling of Hurricane Katrina, just in time for the Republican revelry across the Gulf in Tampa to get into full swing.
Your party hacks are the ones who claimed that prayer stopped Isaac from coming to Tampa (never mind the start of the convention was delayed by a day by Isaac)…
So your argument is
“Johny got away with saying a bad work so I can too!”
Sheeesh….
A few years ago, I asked an FBI agent our family knows whether drug money was often laundered into the high end of the San Diego housing market. He acted totally clueless about the possibility. (It’s hard to tell when FBI agents are acting, though.)
Drug Trafficker’s Realtor Sentenced
By Mike Wille
Story Published: Aug 27, 2012 at 11:15 PM PDT
SAN DIEGO (CNS) - A San Diego real estate agent who submitted false loan documents for a drug trafficker to purchase two residences and property was sentenced Monday to four years in prison.
Marco Manuel Luis, 32, was also ordered by U.S. District Court Judge Irma E. Gonzalez to pay restitution to the banks that lost more than $500,000 because the properties were foreclosed, according to U.S. Attorney Laura E. Duffy.
Luis pleaded guilty March 19 to two counts of conspiracy to engage in money transactions in property derived from an unlawful activity.
Luis was charged with conspiracy to launder money related both to the purchase of a Rancho Santa Fe residence that exceeded $2 million and the purchase of a Palomar Mountain property and residence, Duffy said.
Luis admitted as part of the plea, he was the real estate agent for convicted drug trafficker Joshua Hester and submitted and facilitated false loan applications, verification documents and financial documents.
From December 2006 to September 2009 he assisted in completing the loan application for the Rancho Santa Fe property, knowing that Hester was its owner, Luis admitted.
…
Real estate transactions are some of the most public transactions that exist. You don’t think people show up to a closing with a few trunks of $10s and $20s or even $100s do you? The money has to be laundered (gotten into a bank though a legit appearing business) before it is used to buy real estate.
I took a brief trip to Nogales, Sonora last Friday. On the U.S. side of the border, in Nogales, Arizona, there were houses that, ahem, looked a bit too rich for their neighborhoods. They looked like drug money laundering palaces to me.
On the Mexican side, all of the housing and the CRE looked pretty dumpy. And don’t get me started on the condition of the roads. If you think ours are bad, just go for a drive in Mexico.
OTOH, the Mexican hosts of the event I photographed were absolutely wonderful. Unlike an American shoot, where I pretty much have to be invisible, I kept having to shake-shake-shake the hands, exchange greetings, and pass out the business cards. It was fun!
What was the event? A fiesta in honor of a joint U.S.-Mexican water harvesting project that’s located on the grounds of a technical college (”El Tech”) in Nogales, Sonora. Me gusta agua dulce! Y la comida con el agua? Delicioso!
Sorry, Slim. There is a difference between using drug money to buy a house and using a house purchase to launder the money. Drugs are a cash business. To accumulate money effectively you have to get it into a bank. If you just pay “cash” (meaning actual bills of legal tender, not just not having a loan) then the person you bought the house from has to figure out how to get the money into a bank and in a real estate transaction it is trivially easy to find out who paid you the cash.
Banks are required to report transactions over $10K or a series of transactions that look like they are happening to get around the $10K rule. The best way to get money into a bank is to pretend it is the income of a legit business with a lot of cash transactions (used to be dry cleaning and restaurants, not sure what they use now). But just handing $200K in small bills to another person does not lauder it effectively. Maybe if you buy a bunch of dumps in the regular way and deposit the cash as if you were renting to people who aren’t Section 8? Still a mess and a lot of state and local regulation.
OTOH, the Mexican hosts of the event I photographed were absolutely wonderful. Unlike an American shoot, where I pretty much have to be invisible, I kept having to shake-shake-shake the hands, exchange greetings, and pass out the business cards. It was fun!
Sounds like an opportunity to get a lot more business where you least expected it.
It may very well be. Cross your fingers, mmm-kay?
Hurry up and buy into this dead cat bounce before the opportunity ends!
August 27, 2012, 6:03 PM
Why Home Prices Are Rising: The ‘Distressed Share’
By Nick Timiraos
Tuesday’s measure of June home prices from the S&P/Case-Shiller 20-city index is likely to turn positive when compared with one year ago for the first time in two years, according to a forecast by Zillow Inc.
Prices have risen this summer for a simple reason: more buyers have chased fewer properties. But the drop in supply and the boost in demand isn’t the only reason that Case-Shiller is now turning positive. Another related factor is that the share of non-distressed home sales is rising and the share of distressed sales—foreclosures and short sales, mostly—is falling.
(Case-Shiller reports prices using a three-month moving average with a two month lag. Several other home price indices have also shown bigger-than-usual price gains for the second quarter.)
The decline in the distressed share is important for the housing market, and especially for home-price indexes like Case-Shiller. Because banks are faster to cut prices to unload inventory than are mom-and-pop sellers, home values can fall further as the share of distressed sales rises. This was the case throughout 2008, as home price declines were in virtual free fall amid a cycle of rising foreclosures.
A report last week from economists at Goldman Sachs tries to quantify the share of the decline in home prices that can be attributed to the rise of distressed versus non-distressed homes. They conclude that this “mix shift” is responsible for around one third of the 34% decline in home prices since 2006.
While distressed homes normally account for around 5% of all home sales, the distressed share reached a peak of nearly 50% in early 2009, as the housing market unraveled. The share normally falls during the stronger spring and summer months, when there are more mom-and-pop home sellers, while it rises during the seasonally weaker autumn and winter—though it hasn’t gone as high as 50% since 2009.
The share of distressed sales is still high by any historical comparison. But importantly, it is falling when compared with one year ago, which is a big reason why home prices, as measured by the Case-Shiller index, are rising again. In June, the share of non-distressed sales, meanwhile, was at its highest level since August 2008, according to CoreLogic Inc.
In May 2012, around 25% of all homes were distressed sales, down from 31% one year earlier, according to Goldman. Moreover, Goldman estimates that banks are losing less money on distressed sales than they have in the past, in part because banks are pushing short sales more aggressively. The average distressed home sold at a 20% discount to comparable non-distressed homes, an improvement from discounts of 25% to 30% earlier in the crisis.
…
Just a reminder, this happened in 2010. The year-on-year increases didn’t last then. If the year-on-year price increases continue into 2013, and construction activity increases, then we might be able to conclude this is more than a dead-cat bounce.
SMART MONEY
August 27, 2012, 3:00 p.m. ET
In Mostly Tepid Housing Recovery, ‘Jumbo’ Home Loans Set Hot Pace
By ANNAMARIA ANDRIOTIS
By most measures, the housing market’s recovery has been slow. But private-market “jumbo” mortgages—larger, higher-cost home loans that aren’t guaranteed by the federal government—are making a much faster comeback.
Private-market jumbo loans accounted for about 15% of the total dollar amount of mortgages distributed by Bank of America Corp. (BAC -0.62%) during the second quarter of 2012, up from 4% a year earlier, says a spokesman for the bank. At Wells Fargo & Co., (WFC -0.24%) private jumbo volume more than doubled in the first half of the year from the same period last year, according to Brad Blackwell, portfolio business manager for the bank’s home-mortgage unit. Citigroup Inc. (C -0.61%) also says it has increased jumbo lending.
In all, lenders doled out $38 billion in private jumbo mortgages during the second quarter of 2012, up 65% from a year earlier, according to new data compiled by Inside Mortgage Finance, a trade publication. That is the highest quarterly dollar amount since the first quarter of 2008.
“This is a real positive for the entire marketplace, and hopefully this is the first sign that credit markets will open up,” says Jack McCabe, an independent housing analyst in Deerfield Beach, Fla.
…
At what point did propping up the housing market turn the Fed’s dual mandate, of controlling inflation and keeping employment high, into a triple-mandate?
P.S. Please translate into non-Fedspeak: “Housing has improved considerably since then.”
AHEAD OF THE TAPE
Updated August 27, 2012, 5:53 p.m. ET
Housing Prices Have a New Cliff to Climb
By DAVID REILLY
Don’t forget housing.
Markets are intensely focused on what Federal Reserve Chairman Ben Bernanke will say about the possibility of more central-bank bond buying when he speaks Friday in Jackson Hole, Wyo. Also interesting, though, will be the emphasis he places on housing.
The upturn in home prices is especially notable because gains in 2010 were largely due to a government tax credit.
During last year’s speech, Mr. Bernanke highlighted how housing was holding back the economic recovery. Underscoring this, the central bank in January sent to Congress a housing “white paper” outlining possible ways to stimulate activity.
Housing has improved considerably since then. The question is how durable the recovery will prove.
S&P/Case-Shiller home-price data due Tuesday should underscore the improving trend. The main 20-city, composite home-price index for June is expected to show its first positive, year-over-year gain since September 2010. This would follow positive performances from other indexes and gauges of sales activity.
The upturn in home prices is especially notable because gains in 2010 were largely due to a government tax credit. Excluding those months, there hasn’t been a positive year-on-year result for the Case-Shiller index since December 2006.
Continued improvement, even at a modest pace, is important to sustain the housing recovery. Despite superlow interest rates, many buyers have hung back for fear of purchasing something that will be cheaper in a year’s time.
But with housing firmer, it may become a tailwind for the economy. Residential investment should contribute about 0.2 percentage point to real gross domestic product this year, the first positive, annual contribution since 2005, estimate Fannie Mae economists. And rising house prices should bolster confidence.
Yet, Mr. Bernanke can’t breathe easy. The same worry he has for the economy, the looming “fiscal cliff,” could derail the housing turnaround by spooking consumers. “While there are underlying forces pushing growth in housing, it’s not going to be robust until the public gets comfortable with the idea there is going to be a growing employment and income environment,” says Doug Duncan, chief economist at Fannie Mae.
…
At what point did propping up the housing market turn the Fed’s dual mandate, of controlling inflation and keeping employment high, into a triple-mandate?
It was the second part of your question that provided the answer.
During last year’s speech, Mr. Bernanke highlighted how housing was holding back the economic recovery. Underscoring this, the central bank in January sent to Congress a housing “white paper” outlining possible ways to stimulate activity.
If the Fed wants to be successful in it’s policy of “full employment”, and it is the housing market which the Fed feels is keeping economic growth sub-par, than it stands to reason the Fed views fixing Housing’s drag on the economy as part of it’s mandate to achieve economic growth and full employment.
A housing recovery could lead a full economic recovery. The problem here is how the government is going about it. Throw all of the distressed inventory onto the market and see where we are in 3 years. The problem is we’re trying to manipulate the market.
The problem also seems to be a misguided belief that a manipulated recovery is just as sustainable as a fundamentals-based one.
The problem also seems to be a misguided belief that a manipulated recovery is just as sustainable as a fundamentals-based one.
There we go. I hadn’t come up with quite the correct wording, but there it is.
We have not had a fundamental’s based economy in more than 30 years. We’ve had an economy based on unsustainable debt growth. The stock boom of the 80s, the tech bubble of the 90s, the housing bubble of the 2K0s… all every bit as manipulated as the current economy.
Are you saying it can go on forever since we’ve made it this far? I suspect it can’t.
Exactly, Darrell.
“We have not had a fundamental’s based economy in more than 30 years. We’ve had an economy based on unsustainable debt growth.”
The course Ronald “Mommy?” Reagan decided for us.
Thats right. A “housing recovery” is dramatically lower prices by definition.
Housing is going to do a whole lot of recovering over the coming years and decades.
What is happening is different in judicial vs. non-judicial states.
Judicial states have done almost nothing to clear their distressed inventory.
Non-judicial states have gone much faster in bringing distressed housing to market.
How “sustainable” all of this is, depends primarily on whether you are talking about a judicial vs. non-judicial state, and further, whether cans continue to be kicked in the judicial states.
And if you look at construction job numbers, and the number of homes being built relative to long term averages, Bernanke has a point.
As do those who say an economy built on building, selling and flipping houses is not a sustainable economy.
It’ll be a long climb back to 1.2-1.5MM from ~750k. That 1.2-1.5MM is the sustainable number for the creation of shelter. Lots of additional jobs from 750k to 1.2MM/1.5MM.
Candidly, I could do without the flipping part of the business, as well as the HELOCing to spend. I know that’s a driver of the economy, but I’m simply looking at putting guys with hammers back to work.
“It’ll be a long climb back to 1.2-1.5MM from ~750k”
I’ll now argue that ~750K is still too high.
10 million too many houses have been built if we look at current vacancy rate vs. the norms of the 50s-80s.
Demographics should be resulting in 1 million new households a year. History says we should be replacing about 200K houses a year. Long term, sustainable demand over the next 10 years is, therefore, about 1.2 million houses a year. Subtract 700K new construction, and you find a burn rate of excess inventory of 500K housing units a year.
10/.5 = 20 years to burn off the excess inventory.
Remember, 20 years!
The 1 million new households a year is based on people becoming adults having been born at 4 million a year, people dieing off having been born at 2.5 million a year netting 1.5 million a year gain + 1 million legal immigrant and .5 million illegal = 3 million population gain / 3 people per household.
Well, give it 10 years, and instead of the boomers starting to turn 65, they will be turning 75 and starting the great die off. Within 15 years, deaths will grow to match the births of new adults, taking away 1.5 million new people. This would bring the household formation rate closer to 1.5 million… assuming we maintain 1.5 million net immigration.
If we cut household formation to half a million, and then add 200K replacement rate, then we match the 700K current construction rate. However, we’re still within the 20 years that the 700K construction rate will take to work off the excess.
Therefore, it is my belief that 700K is still too high, and if it goes higher, we’d just be building even more excess empty houses.
The number I saw for replacement is ~400k, which puts the number a couple of hundred thousand higher. That though is a minor point in my argument.
Housing is different than other products when there it too much inventory, and as we know, the excess inventory is not uniformly spread throughout the US, or even within a particular state.
Said another way, an excess house in Florida cannot be easily moved to where it is needed.
Likewise, and excess house in Victorville, CA, cannot be easily moved closer to the jobs 2-3 hours south.
For this reason, there will be construction improving even when there are still excesses from the macro standpoint.
OK. But at the same time, those houses in Florida and Victorville should get very VERY cheap. So cheap it’s tempting to move a business that depends on large numbers of low wage employees there because they’ll be able to practically live for free. So far we seem determined to prevent that. Not sure if that will somehow affect construction in the places where the jobs currently are…
Very cheap relative to what? Rents? Replacement cost?
A quick Craigslist search found 5 rentals in Victorville, for an average of about $0.65 per square foot for month (anything with 3 or more bedrooms was about $0.60 psf). Using traditional metrics, this translates to a home value at ~$65 to $78 psf (100-120x monthly rent), or slightly less at ~$60 to $72 psf if you exclude the smallest two rentals.
Zillow pegs the median value in Victorville at $59 per square foot, with median sale prices at $61 per square foot. Sale prices crashed to about $60 per square foot in mid-2009, and have been stuck there ever since.
Aren’t rents a pretty good indicator of true value since there is less impact from monetary policy in the landlord/tenant relationship? Wouldn’t home values at about 100x monthly rent indicate that home prices have hit a “fair” value?
We’ve invested in projects based on the theory you described above (ie. that businesses will move to where the people have already moved due to affordability issues). The theory was great, the movement has been VERY weak by businesses. We’ve seen some satellite office creation, but no big moves.
That said, there are no hard and fast rules–capital does at times still act logically. One thing that we’ve heard in this recent cycle, as an example, is that cheaper housing in suburbs of Phoenix has caused some call center jobs to re-appear in the greater Phoenix market…this has happened post crash, as home values crashed in those markets, and people could live in those markets with call center type salaries.
There’s little doubt that the very low interest rates are pushing the sales of low end homes in my little burg.
Are owner-occupants buying the low end then?
“At what point did propping up the housing market turn the Fed’s dual mandate, of controlling inflation and keeping employment high, into a triple-mandate?”
The Fed’s primary role is to maintain stability in the banking system. If asset prices drop, and loans default, and banks can’t absorb the loss…. wait, you do not believe in macroeconomics. Never mind.
“P.S. Please translate into non-Fedspeak: ‘Housing has improved considerably since then.’”
That already is non-Fedspeak. It is the words of the author, not the word’s he’s quoting from anyone at the Fed.
And, the article makes it pretty clear what the author means. More transactions and rising prices.
And an aside:
It would be possible for the Case-Shiller to be increasing, while the total value of housing is falling. The Case-Shiller index does not weight to the number of houses in a market or the price of houses in that market. Each market is treated identically.
So, you could have markets like Phoenix (4 million people) up 10% ($10Kish) and Los Angeles (18 million people) down 10% ($30K). In this case, the Case Shiller would treat these two as equally offsetting, but in reality Phx would have gained like $8 million in housing value while L.A. lost $70 million in value.
I’m, sure RAL will call me a liar, but I’ll say it anyway. Not all markets are equal, but C-S treats them all the same.
Considering prices are falling in Phoenix when defaulted property and REO is included, just what is your point Darryl?
The Fed’s primary role is to maintain stability in the banking system. If asset prices drop, and loans default, and banks can’t absorb the loss….
So Darrell, you’re arguing that the Fed already has a mandate to manipulate any market that the banks are sufficiently deeply invested in??
OpenSecrets categorizes housing with the financial sector, calling it the FIRE sector. That’s because houses are usually bought when a buyer takes out a loan. These loans are the fodder for the financial sector. The housing and financial sectors are thus tightly linked.
The problem with having houses be “too” expensive is that too much money is sucked out of the rest of the economy and concentrated in the FIRE sector. A heterogeneous economy is more resistant to shocks than a homogeneous one built around flipping houses and debt.
If they want to put construction workers to work, they should do it on public infrastructure projects, not projects which merely enrich the FIRE sector.
Tax money should be used for public goods, not Wall Street profits.
“he problem with having houses be “too” expensive is that too much money is sucked out of the rest of the economy and concentrated in the FIRE sector.”
You actually have it backwards. Money is created when it is loaned into existence. Housing being expensive, causing larger loans to be taken out, increases the rate of money creation. Money comes out of thin air, offset by new debt, is handed to the seller. The seller now has the money to spend into the economy. This, and cash-out refi also generating mass sums of new money and offsetting debt, is why the economy appeared to be booming even as house prices doubled and, as you claim, absorbed ever more money.
Perhaps you mean that lending drives the FIRE industry closer to the max leverage. No problem there either. MBS required no reserve. QE takes the loans from the banks, freeing up room under the max leverage limits. Had house prices continued going up, there would have been no limit to the amount of money/debt that FIRE industry could have created out of thin air and pumped into the economy. The limit was not money, but rather we ran out of greater fools looking to buy into the housing bubble.
“If they want to put construction workers to work, they should do it on public infrastructure projects, not projects which merely enrich the FIRE sector.”
Again, on debt? Government borrowing and spending, and the FIRE sector buying the treasuries instead of direct loans to consumers? It is still just unsustainable debt growth, pumping new debt/money into the economy 3x as fast as incomes are rising.
To figure out how to really create sustainable jobs, one needs to start by looking at where the $1.2T new debt/money we are creating goes, and why that massive new money creation is not causing run away inflation. Hint, it ends up in the hands of people that don’t spend it, but rather look to loan it out to public or private sector debtors.
The key to creating a long-term sustainable economy has to begin with keeping the money in circulation rather than trying to make it easier for more of it to escape into the hands of people that won’t spend it.
The problem with having houses be “too” expensive is that too much money is sucked out of the rest of the economy and concentrated in the FIRE sector. A heterogeneous economy is more resistant to shocks than a homogeneous one built around flipping houses and debt.
Ding-ding-ding! We have a winner!
“If they want to put construction workers to work, they should do it on public infrastructure projects, not projects which merely enrich the FIRE sector.”
Every single reds state rejected federal money to build high speed rail to directly spite Obama.
Thus, an infrastructure project that would have brought huge economic benefits beyond the life the construction phase, was aborted for purely political reason.
Aug. 28, 2012, 3:28 a.m. EDT
Spain’s recession deepens in second quarter
By David Roman
MADRID (MarketWatch) –Spain’s economic recession deepened in the second quarter, final data released Tuesday showed, as gross domestic product contracted at a faster pace both on an annual and a quarterly basis amid a steep downturn in domestic spending.
The euro zone’s fourth-largest economy contracted 0.4% from the first quarter and by 1.3% compared with the second quarter of last year, Spain’s statistics institute INE said. The quarterly reading is in line with preliminary INE estimates released last month, but the annual reading is worse than the previous estimate of a 1% contraction.
…
Tee-hee.
JULIA GREW UP, GOT MARRIED, AND BECAME A REPUBLICAN
Powerline | August 27,2012 | PAUL MIRENGOFF
A new Washington Post/ABC survey shows that Mitt Romney has a huge lead over President Obama among married women. The Hill has the details:
Married women are strongly backing Mitt Romney, 55%-40%, over Barack Obama.
Compare that with 2008 exit polls when Obama won married women with children, 51%-47%, while McCain won married women with no kids 53%-44%.
Romney’s 15% margin soundly beats both numbers.
Thus far, the so-called “war on women” isn’t leading to any stronger a gender gap than in previous, close elections.
And the so-called “gender gap” is about something other than gender.
Who do the divorced women support?
Cougars, the last political frontier?
Tom Cruise?
“Who do the divorced women support?”
http://www.youtube.com/watch?v=3zxtRo0BYx8 - 146k -
who do the TBTF trust busters support?
Yeah, Mitt is the husband of one woman, he’s honest (hehehe) and clean cut. Married moms are going to like him better. They’re too smart to go for that war on women crap.
Single moms and single women like Barrack cuz he’s going to take care of them, like a good husband should.
You’ve contradicted yourself.
How so?
In a single parent family, the women don’t need a man because the state is providing for their needs. While this is a genuine charitable reason to support the women because we know many of the men are scoundrels, it also has the tendency to encourage single parent homes.
Did I still do it?
So the definition of single-parent family… is a woman on gubmint assistance? OK Lip, now I get it.
Aug. 28, 2012, 12:40 p.m. EDT
Treasurys rise after ECB’s Draghi bows out
U.S. selling $35 billion in notes later in Tuesday’s session
By Deborah Levine, MarketWatch
SAN FRANCISCO (MarketWatch) — Treasury prices rose Tuesday after European Central Bank chief Mario Draghi canceled plans to speak at the Federal Reserve’s Jackson Hole conference this weekend.
Meanwhile, the U.S. will sell $35 billion in 2-year notes (2_YEAR 0.00%) , an auction that analysts expect to go smoothly.
Yields on 10-year notes (10_YEAR -1.39%), which move inversely to prices, fell 3 basis points to 1.64% — the seventh of eight sessions in which yields have fallen. Read about recent Treasury gains.
A basis point is one one-hundredth of a percentage point.
Thirty-year yields (30_YEAR -0.72%) declined 2 basis points to 2.75%.
Yields on 5-year notes (5_YEAR -2.03%) slipped 1 basis point to 0.67%.
Draghi was considered the second-most important speaker at the conference, and his absence will put more attention on Fed Chairman Ben Bernanke’s anticipated comments about whether the U.S. central bank will buy more bonds to ease financial conditions.
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The Magical World of Charles Evans
Mercenary Trade
Aug. 28, 2012, 9:58 AM
Consider this article a plea for assistance. Would someone with a PhD in economics, or better yet, deep-level training in Fed Speak, step forward and help this simple caveman trader solve a true “conundrum” of Alan Greenspan caliber?
It has to do with Charles Evans, President of the Federal Reserve Bank of Chicago. On Monday, Reuters ran a headline story, Fed’s Evans: Buy Bonds Until Jobless Rate Falls.
Here is the gist:
The Federal Reserve should launch a fresh round of monetary stimulus immediately, buying bonds for as long as it takes to produce a steady decline in the jobless rate, a top Fed official said on Monday.
Without a change in policy, the unemployment rate, now at 8.3 percent, was unlikely to fall below 7 percent before 2015 at the earliest, Chicago Federal Reserve Bank President Charles Evans told reporters in Hong Kong.
“I don’t think we should be in a mode where we are waiting to see what the next few data releases bring,” Evans told a seminar at the Hong Kong Bankers Club. “We are well past the threshold for additional action; we should take that action now.”
…
It’s called “Pushing on a string”, at least for the small-fry. Consumers are already loaded with debt and can’t/aren’t taking out more, at least not until everyone starts getting raises.
Guess who is winning with this policy of direct Fed buying of bonds? As the article states, big business and the extremely wealthy, who are borrowing at historically low rates. The same rates being pushed down by the Fed.
He is clearly a person that thinks monetary policy alone can fix all ills, when in reality, our issues are largely trade and fail tax policy based.
Perhaps his logic is that if they push rates low enough, the rich will stop even bothering to try to become richer, and will just go ahead and spend the $ trillions they are sitting on, and then China will stop accepting the debt/dollars in exchange for goods and services so that we can balance trade.
It is all about “CHOICE” until it comes to joining a union as a condition of EMPLOYMENT and having your union dues taken out of your paycheck WITHOUT your consent.
Unions are the top 14/20 political donors of ALL time and nearly 100% of their donations go to the democratic party.
http://www.opensecrets.org/orgs/list.php?order=A
It is one hell of a scam and corrupt system.
——————–
Prop. 32: What really scares California’s big unions
The Los Angeles Times | 8/24/2012 | Larry Sand
Michael Hiltzik infers in his column Sunday that Proposition 32 is a big lie — because it prohibits both corporations and labor unions such as the California Teachers Assn. from extracting involuntary political contributions from the paychecks of workers. Hiltzik argues that its prohibition of corporate deductions is of minor impact, but that union political fund-raising will be crippled.
He is amazingly untroubled by the fact that taking such payroll deductions for political purposes without consent is patently immoral. Why should a worker have some of his forced union dues spent on candidates or causes that he doesn’t agree with? As Thomas Jefferson said, “To compel a man to furnish contributions of money for the propagation of opinions which he disbelieves is sinful and tyrannical.”
Oddly, Hiltzik seems concerned only that the CTA and other public employee unions maintain the ability to build massive political war chests so they can pour tens of millions of dollars into the same types of independent spending efforts that so offend him.
What’s the problem? The Supreme Court has ruled political contributions are now protected free speech.
A ruling brought about by a petition from Citizens United, one of THE most conservative organizations in existence.
Good for the goose…
“The state refuses to collect dues and changes the law to make dues and union membership entirely voluntary. What do people do?
That’s easy … they quit paying the dues:
Public-employee unions in Wisconsin have experienced a dramatic drop in membership—by more than half for the second-biggest union—since a law championed by Republican Gov. Scott Walker sharply curtailed their ability to bargain over wages and working conditions.
Wisconsin membership in the American Federation of State, County and Municipal Employees—the state’s second-largest public-sector union after the National Education Association, which represents teachers—fell to 28,745 in February from 62,818 in March 2011, according to a person who has viewed Afscme’s figures. A spokesman for Afscme declined to comment.
Much of that decline came from Afscme Council 24, which represents Wisconsin state workers, whose membership plunged by two-thirds to 7,100 from 22,300 last year.
A provision of the Walker law that eliminated automatic dues collection hurt union membership. When a public-sector contract expires the state now stops collecting dues from the affected workers’ paychecks unless they say they want the dues taken out, said Peter Davis, general counsel of the Wisconsin Employment Relations Commission.
In many cases, Afscme dropped members from its rolls after it failed to get them to affirm they want dues collected, said a labor official familiar with Afscme’s figures.”
http://www.philadelphiaspeaks.com/forum/national/30667-what-happens-when-state-no-longer-forces-workers-into-union.html - 59k -
Why would anyone waste their money on union dues, if they can’t collectively bargain their contracts on compensation and working conditions? Your only protection comes from the U.S. labor dept. and OSHA and they’re free.
Thank God - finally someone loses their bank job over criminal actions!
http://finance.yahoo.com/news/wells-fargo-fires-iowa-worker-for-minor-1963-crime.html
Oh.
How did they even find the records? And just how much effort was put in to finding 50 year old records? I can tell you from personal experience it’s not easy.
This is an obvious ploy to get rid of someone close retirement. Firing people with less than 5 years left to retirement has been SOP for decades.
Best comment:
“It is amazing that Wells Fargo can find 49 year old records of a crime over 10 cents but can’t correctly compile their own mortgage records for their borrowers.”
Retire All Personel Early (RAPE).
Banks can’t do a forcible RAPE so they’ll do the next best thing, which is a legitimate RAPE.
Or maybe a statuatory RAPE. Whatever.
The Rule of Law can work wonders, no?
This Republican convention is like watching something out of the Soviet Politboto. Although seven states have voted in majority or entirety for Paul, that fact is not being acknowledged in the official delegate count. “Madam Speaker” does not even enter his name into the official record.
What would you say about Ron Paul if he was the party nominee and was was the only thing between your Progressive Messiah and another four years in the White house? Ron Paul’s cuts to the budget make Ryan’s look like toll booth change and progressives would be trashing him in a ways we could never imagine.
“…your Progressive Messiah..”
Sweetie, if you think Obama is “progressive” you’re even denser than you come across. As for the “Messiah” monker, the only people I’ve ever heard use that descriptor are Limbaugh’s barking dogs.
Ron Paul, Rick Santorum, Sarah Palin et al are legitimate representatives of the American electorate and as such they deserve a voice in our Congress. So do political progressives, and even your dreaded socialists like Bernie Sanders and Barbara Lee.
Btw, we call this “democracy”.
Sarah Palin was elected to Congress?
“deserve a voice”.
‘Btw, we call this “democracy”.’
Very little is democratic, it’s representative. Most of the populace was against the bank bail outs. I don’t remember getting to vote on traffic fine amounts.
Ocean horrorshow*
*Nadsat
Those Firedoglake meanies are raining all over the housing recovery parade! The latest”
Housing Price Index Shows First Year-Over-Year Increase in 21 Months
The headline sounds nice and sunny. The story? Cloudy and rainy. Key quote:
If you think that the positive of housing prices raising a bit outweighs the negative of hundreds of thousands of blighted homes dotting the US landscape, fine. But make that explicit. Point out that you don’t think shadow inventory will be a factor because you think a bunch of dilapidated homes will just sit their uninhabited. And let me know what people think about that circumstance, particularly local governments, who will inevitably have to pay the price.
The other factor leading to the constriction of supply is the rapid purchase of foreclosed and distressed properties by investors, for conversion to rental units. One analyst relayed to me that the percentage of home sales going to investors has now gone above the bubble years. You can anecdotally feel this with the return of “Flip My House”-type programming on TV. There are plenty of pitfalls for this type of activity, especially if we see a large issuance of rental revenue-backed securities on the market. But more than that, this could lead to a generation of absentee slumlords, redevelopment of depressed areas in ways that price out current residents, and a bubble in these REO-to-rental acquisitions that could be vulnerable to crash.
The associated reason for low supply is the continued presence of 16 million underwater homes, which cannot be sold unless the bank agrees to a short sale. This of course increases the potential foreclosure risk.
In other words, the forces underlying the comeback in housing prices aren’t at all stable. They don’t suggest a healthy housing market. They suggest artificial factors making up for the problems with the fundamentals of the industry. Maybe this is enough to raise prices and return some equity to borrowers and lead a recovery on its own. But it’s at least worth giving the full picture before getting excited about a price rise.
There it is….
Don’t forget student debt!
Non-dischargeable in bankruptcy and they’re shoving it out the door as fast as they can.
It’s awesome. It’s like watching a whole generation self-destruct in real-time.
Wonderful, simply awe-inspiringly wonderful.
“Don’t forget student debt!”
“It’s awesome. It’s like watching a whole generation self-destruct in real-time.”
Posted: 7:39 p.m. Tuesday, Aug. 28, 2012
Obama courts college students returning to campus
By JULIE PACE
The Associated Press
FORT COLLINS, Colo. —
President Barack Obama, appealing to students who powered his first White House run, swooped onto college campuses Tuesday to remind those returning to class that they hold a unique power to determine the election.
“I just want all of you to understand your power. Don’t give it away — not when you’re young,” Obama told about 13,000 people gathered on the campus of Colorado State University. “Right now, America is counting on you. And I’m counting on you.”
“Last week my opponents’ campaign went so far as to write you off as a lost generation. That’s you according to them,” the president said at Iowa State University, referring to a Romney news release last week that referred to college students as the “Obama Economy’s Lost Generation.”
“What they hope is that by telling you these things, you’ll get discouraged and you’ll just stay home this time,” Obama said in Ames, Iowa. “But you can’t believe it. I don’t believe it.”
Romney’s campaign dismissed Obama’s remarks, saying he had “brought the same policies to Iowa that have failed to help young Americans across the country” and left many of them “facing higher unemployment, mounting debt, rising costs, and fewer opportunities.”
This has to be one of the best singles ads ever printed. It is reported to have been listed in the Atlanta Journal.
Love the response this ad got!!
SINGLE BLACK FEMALE seeks male companionship, ethnicity unimportant. I’m a very good girl who LOVES to play. I love long walks in the woods, riding in your pickup truck, hunting, camping and fishing trips, cozy winter nights lying by the fire. Candlelight dinners will have me eating out of your hand. I’ll be at the front door when you get home from work, wearing only what nature gave me…. Call (404) 875-6420 and ask for Jennie, I’ll be waiting…..
Over 150 men found themselves talking to the Atlanta Humane Society.
http://www.funnyordie.com/articles/763285a555/single-black-lady - 153k -
“SINGLE BLACK FEMALE seeks male companionship, ethnicity unimportant. I’m a very good girl who LOVES to play. I love long walks in the woods, riding in your pickup truck, hunting, camping and fishing trips, cozy winter nights lying by the fire. Candlelight dinners will have me eating out of your hand.”
Definitely sounds like a man’s fantasy best friend!
LOL! Cute dog. I wonder if a man or woman wrote the ad. I could see either one. Whoever wrote it would make a good copywriter.
ft dot com
August 28, 2012 7:43 pm
How Romney could go wrong from Day 1
By Stephen Roach
True to his word as a candidate, a few hours after taking office as US president on January 20, 2013, Mitt Romney issued his first executive order, declaring China guilty of currency manipulation. In accordance with the Omnibus Trade and Competitiveness Act of 1988, President Romney’s act triggered immediate negotiations between US and Chinese officials. But the negotiations stalled and both parties blamed the other in press releases.
In early February, in his first State of the Union address, Mr Romney said: “Enough is enough. It is high time for China to play by our rules.” Congress roared its approval and within a week, overwhelming bipartisan majorities of both houses passed the Defend America Trade Act of 2013. Modelled on the currency manipulation “remedies” of countervailing tariffs first proposed in 2005, DATA was signed into law on President’s Day, February 18 2013. China was quickly deemed to be in violation of the new statute.
At that point negotiations took on a new urgency. But the new leaders in both countries were in no mood for compromise and the talks failed. In accordance with the provisions of DATA, Washington slapped immediate tariffs of 20 per cent on all Chinese products entering the US.
As plants shut down across China, Beijing declared this to be an act of economic war and filed a complaint with the World Trade Organization. Li Keqiang, newly installed as premier, announced after the National People’s Congress in March that China had no patience to endure a WTO dispute process that could take anywhere from two to five years to run its course.
China’s Ministry of Commerce then announced retaliatory tariffs of 20 per cent on all US exports to China. This hit growth-starved America right between the eyes. With $104bn of American-made goods sold in Chinese markets in 2011, China had become the US’s third-largest and its fastest-growing export market. To add insult to injury, China-dependent Walmart announced average price increases of 5 per cent. Other retailers followed suit. Talk of stagflation was in the air and hard-pressed American consumers hunkered down further.
US financial markets swooned. The stock market was hit by pressures on profit margins, growth and inflation. The bond market was also unnerved by the realisation that the Federal Reserve was seriously behind the curve. With good reason. After its meeting in June 2013, the Fed reaffirmed its ever-extending commitment to keep its benchmark policy rate near zero through 2015, and even dangled the possibility of yet another round of quantitative easing, QE4. Yields on 10-year Treasuries moved back above 4 per cent and stocks fell sharply further.
Feeling the heat from financial markets, Washington turned up the heat on China. Mr Romney called Congress back from its Independence Day holiday into a special session. By unanimous consent, Congress passed an amendment to DATA – upping the tariffs on China by another 10 percentage points.
At that point an indignant China turned to its own version of the big bazooka. The biggest foreign buyer of US debt was nowhere to be seen at the Treasury’s August 2013 auction. Long-term interest rates spiked and within weeks yields on 10-year Treasuries hit 7 per cent. The dollar plunged and the US stock market went into free fall.
…
An earlier Mormon politician, Reed Smoot, was instrumental in passing the Smoot-Hawley Tariff Act into law, which helped kick the 1930s Great Depression into hyperdrive.
August 28, 2012 7:43 pm
How Romney could go wrong from Day 1
By Stephen Roach
True to his word as a candidate, a few hours after taking office as US president on January 20, 2013, Mitt Romney issued his first executive order, declaring China guilty of currency manipulation. In accordance with the Omnibus Trade and Competitiveness Act of 1988, President Romney’s act triggered immediate negotiations between US and Chinese officials. But the negotiations stalled and both parties blamed the other in press releases.
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History warns us never to say never. We need only look at the legacy of US Senator Reed Smoot and Representative Willis Hawley, who sponsored the infamous Tariff Act of 1930 – America’s worst economic policy blunder. Bad dreams can – and have – become reality.
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+12 -18
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