The Housing Bubble

Debt crisis: politicians drive bank union but markets focus on Spain
Spanish borrowing costs rose above 6pc again as a continued stand-off between Madrid and Brussels fuelled fears that the European Central Bank’s bond buying programme pledge is not enough to stabilise the eurozone.

http://www.telegraph.co.uk/finance/financialcrisis/9549245/Debt-crisis-politicians-drive-bank-union-but-markets-focus-on-Spain.html

Groundhog day again

Divergence:

Pres12_WTA
2012 US Presidential Election Winner Takes All Market

But not to worry, Romney fans, as our own Polly has assured us that this graph has nothing to do with the election outcome.

Is the global central banker cartel losing its ability to control asset prices?

Sept. 17, 2012, 10:16 a.m. EDT
Realtors choose moaning over action on tight loans
Commentary: Agents should be willing to shoulder pain of bad loans
By MarketWatch

WASHINGTON (MarketWatch) — To hear the National Association of Realtors tell it, if only banks had looser mortgage standards, another 700,000 homes would be sold and 350,000 jobs would be created.

That’s according to a release Monday from the trade association. NAR says between 500,000 to 700,000 more homes and between 250,000 to 350,000 new jobs would be created if standards weren’t too tight. There probably will be about 4.6 million homes sold this year, whereas the NAR says in “normal” circumstances some 5 million to 5.5 million would be sold.

The NAR points out that in the good ole days between 2001 and 2004, just over 40% of Fannie Mae- and Freddie Mac-backed loans had FICO scores over 740, compared to 75% in 2011. Even at the Federal Housing Administration, the average score for denied applications has grown to 669 from 656 for the loans originated in 2001.

Of course, real estate agents have all the upside (higher sales) and little of the downside (bad loans) to gain from looser standards.

In fact, the only way real-estate agents would suffer from looser standards is if things got so out of hand, that investors lost confidence in banks to such a large extent that a credit-led huge recession would materialize that would devastate the housing market.

But how likely is THAT going to be?

[Pause.]

Oh. Right.
…

Japan businesses in China hit as protests rage
By ELAINE KURTENBACH, AP Business Writer – 17 minutes ago

TOKYO (AP) — Scores of Japanese-owned factories and stores in China were shuttered Tuesday as anti-Japanese demonstrations raged in dozens of cities.

At stake are billions of dollars in investments and far more in sales and trade between Japan and China, the world’s third- and second-largest economies. The two are so closely entwined, though, that both would suffer from any long-term disruptions.

The Japanese government has been urging Beijing to do more to protect Japanese businesses from trespassing, looting and other damage, Chief Cabinet Secretary Osamu Fujimura told reporters.

“Japanese companies play an important role in the Chinese economy and employment. We believe we should be calm and make rational judgments from a broad perspective,” Fujimura said. Some private and government-level meetings and events have been postponed or cancelled, he said.

Big name brands and retailers appeared to be suffering the brunt of the latest mass outburst of anti-Japanese sentiment, with companies in lower profile sectors less affected.

Many companies said they closed Tuesday as the 81st anniversary of a Japanese invasion brought a fresh wave of protests venting anger over the colonial past and a current dispute involving contested islands in the East China Sea.

In Shanghai, many of the Japanese-owned or oriented shops and restaurants in the western part of the city where the Japanese consulate is located had either closed or covered any Japan-brand signs.
…

All Americans have a bright and prosperous future, even Lucky Ducky.

It’s a crying shame when a candidate’s off-the-cuff remarks go farther to define him that what he says on-the-record.

Romney Doesn’t Disavow Video Remark on American ‘Victims’
By John McCormick - Sep 17, 2012 8:22 PM PT

Mitt Romney said his comment in a video released earlier today calling many Americans “victims” dependent on the government wasn’t “elegantly stated,” while stopping short of disavowing the remark.

The Republican presidential candidate said tonight that his comments, secretly recorded at a campaign event earlier this year, were made while “speaking off the cuff in response to a question.”

“It’s not elegantly stated,” Romney said outside a campaign fundraiser in Costa Mesa, California. “Of course I want to help all Americans. All Americans have a bright and prosperous future.”
…

It’s pretty interesting how the Iowa Electronic Market 2012 US Presidential Election Winner Takes All Market prices showed a big divergence on the day this story broke, no? Implied odds against Romney are now approaching 3:1.

Today, Mitt Romney Lost the Election
By Josh Barro Sep 17, 2012
3:02 PM PT

You can mark my prediction now: A secret recording from a closed-door Mitt Romney fundraiser, released today by David Corn at Mother Jones, has killed Mitt Romney’s campaign for president.

On the tape, Romney explains that his electoral strategy involves writing off nearly half the country as unmoveable Obama voters. As Romney explains, 47 percent of Americans “believe that they are victims.” He laments: “I’ll never convince them they should take personal responsibility and care for their lives.”

So what’s the upshot? “My job is not to worry about those people,” he says. He also notes, describing President Obama’s base, “These are people who pay no income tax. Forty-seven percent of Americans pay no income tax.”

This is an utter disaster for Romney.

Romney already has trouble relating to the public and convincing people he cares about them. Now, he’s been caught on video saying that nearly half the country consists of hopeless losers.

Romney has been vigorously denying President Obama’s claims that his tax plan would raise taxes on the middle class. Now, he’s been caught on video suggesting that low- and middle-income Americans are undertaxed.
…

Hunt: Romney Infighting Shows Alarming Disarray

Sept. 17 (Bloomberg) — Bloomberg’s Al Hunt discusses the problems facing Mitt Romney and the finger-pointing within his presidential campaign. (Source: Bloomberg)

Video: SNL Mocking of Romney/Ryan Could Spell Trouble for His Campaign
by Bryan Schott
09/17/2012

The season premier of Saturday Night Live featured a relaxed Barack Obama because his campaign has a “secret weapon” to help him win the election…Mitt Romney.

Jay Pharoah’s Barack Obama tells the camera he’s not worried about the about the election, but he should be. Why not? Mitt Romney’s inability to connect with voters and Paul Ryan’s perceived troubles with facts.

This is the kind of thing that could be dangerous for Romney as we head into the home stretch of the campaign. Most voters really aren’t paying attention to the day-to-day news coming from the campaign. Shows like Saturday Night Live and The Daily Show can shape conventional wisdom about political candidates among low-information voters.

If the opening skit from this season is any indication, Romney could be in trouble.
…

“Renting won’t work here because rents will move up with general inflation, which is exactly what the Fed’s policy is creating.

Hope so… that is what I was betting on when I chose to be in thrall to a bank rather than a LL.”

Yes, when:

Wages go up.

The number of people with good paying jobs there goes up.

There is a shortage of housing. They aren’t making any more land and everybody wants to live there.

The price of food and gas goes down.

Pigs fly.

The Magnitude of the Mess We’re In

Did you know that annual spending by the federal government now exceeds the 2007 level by about $1 trillion? With a slow economy, revenues are little changed. The result is an unprecedented string of federal budget deficits, $1.4 trillion in 2009, $1.3 trillion in 2010, $1.3 trillion in 2011, and another $1.2 trillion on the way this year. The four-year increase in borrowing amounts to $55,000 per U.S. household.

The amount of debt is one thing. The burden of interest payments is another. The Treasury now has a preponderance of its debt issued in very short-term durations, to take advantage of low short-term interest rates. It must frequently refinance this debt which, when added to the current deficit, means Treasury must raise $4 trillion this year alone. So the debt burden will explode when interest rates go up.

Did you know that the Federal Reserve is now giving money to banks, effectively circumventing the appropriations process? To pay for quantitative easing—the purchase of government debt, mortgage-backed securities, etc.—the Fed credits banks with electronic deposits that are reserve balances at the Federal Reserve. These reserve balances have exploded to $1.5 trillion from $8 billion in September 2008.

The issue is not merely how much we spend, but how wisely, how effectively. Did you know that the federal government had 46 separate job-training programs? Yet a 47th for green jobs was added, and the success rate was so poor that the Department of Labor inspector general said it should be shut down. We need to get much better results from current programs, serving a more carefully targeted set of people with more effective programs that increase their opportunities.

President Obama’s budget will raise the federal debt-to-GDP ratio to 80.4% in two years, about double its level at the end of 2008, and a larger percentage point increase than Greece from the end of 2008 to the beginning of this year.

The problems are close to being unmanageable now. If we stay on the current path, they will wind up being completely unmanageable, culminating in an unwelcome explosion and crisis.

The fixes are blindingly obvious. Economic theory, empirical studies and historical experience teach that the solutions are the lowest possible tax rates on the broadest base, sufficient to fund the necessary functions of government on balance over the business cycle; sound monetary policy; trade liberalization; spending control and entitlement reform; and regulatory, litigation and education reform. The need is clear. Why wait for disaster? The future is now.

http://online.wsj.com/article/SB10001424052702303561504577497442109193610.html

Is there any doubt that we “have a spending problem” in the US?

Houses in the Hamptons for half a mil or less? Say it isn’t so!

http://www.nytimes.com/2012/09/16/realestate/the-hamptons-for-500000.html?_r=0

I’m hearing good news about Chicago, folks! Not one incident of school violence in over a week! Awesome!

Sept. 18, 2012, 6:43 a.m. EDT
Obama is stealing Wall Street from Romney
Commentary: It’s not about positions, issues or values
By David Weidner, MarketWatch

SAN FRANCISCO (MarketWatch) — When it comes to U.S. presidential politics, lose Wall Street and you’ve lost the election.

Goodbye, Mitt.

It’s over.

I know, I know. Many of you are going to call me liberal patsy, a mouthpiece for President Obama. You’re going to say I’m in the tank, a Democratic hack. Blah, blah, blah.

Whatever. You can disagree with me, but you can’t argue with facts, and you can’t dispute history. If it were the other way around, I’d call it as such.

The fact is, Romney is behind.

And history shows that, as a presidential election nears, Wall Street — represented by the securities, banking, insurance and real-estate industries — tends to go with a winner.

This doesn’t mean that Romney, who made his career in private equity at Bain Capital, and Paul Ryan, who once championed turning a portion of our Social Security taxes over to personal investment accounts, aren’t more ideologically in line with the financial industry. They are.
Election 2012

It doesn’t mean that investors who support fiscally conservative principles have abandoned Romney in favor of Obama. They haven’t.

What it does mean is that Romney continues to trail in key races. He’s behind by at least five points in the critical swing states of Ohio, Florida and Virginia, according to a new round of polls. Wall Street wants to hedge its bets, buy some influence and be on the winning side. So, it has to make a choice: Support the loser or the winner.

Wall Street always goes with a winner.

It happened in 1996, 2000 and 2008. Presidents Clinton, Bush and Obama all saw a rush in contributions just before the election, according to Federal Election Commission data.
…

Sept. 18, 2012, 8:00 a.m. EDT
Fed’s Evans: ‘This was the time to act’
By Greg Robb

WASHINGTON (MarketWatch) — The Federal Reserve needed to launch another round of asset purchases given the problems facing the economy and the potential dangers lying ahead, said Charles Evans, the president of the Chicago Federal Reserve Bank on Tuesday. “It is essential to do as much as we can now to bolster the resiliency and vibrancy of the economy,” Evans said in a speech to a business group in Ann Arbor, Mich. The economy faces some “big risks” from the global slowdown and the U.S. fiscal policy stalemate, he said. Evans has been a strong proponent of additional Fed easing, and wanted the Fed to say it wouldn’t stop easing until the unemployment rate fell below 7%. While the Fed stopped short of setting any specific target, Evans said he supported the Fed action “wholeheartedly.” He argued that the Fed has taken “a strong step towards economic conditionality” by saying it would continue to purchase assets until there was significant improvement in the labor market. And the central bank language that it would keep rates near zero even after the economy strengthens should reassure investors and businesses that the Fed will not tighten prematurely, he added.

Still waiting for an answer:

Remind me again why it’s okay for companies, organizations and governments to maximize their profits, but not people?

Soon you’ll zoom all around the room
All it takes is faith and trust
But the thing that’s a positive must
Is a little bit of pixie dust
The dust is a positive must
You can fly! You can fly!
You can fly! You can fly!

Here’s why everyone is so excited about what the Fed did yesterday
Posted by Ezra Klein on September 14, 2012 at 12:41 pm

I want to explain why everyone is so excited about what the Federal Reserve did yesterday. But I want to do it without using the words “quantitative easing,” because those words are almost designed to get you to give up and stop paying attention.

Imagine you got a choice of superpowers. You could be invisible, you could fly, you could be really strong, or you could create unlimited amounts of money. You might well choose the money one. The other ones are cool for a bit, but they’re not all that versatile, and they may well get you into trouble.

The best way to think about the Federal Reserve is that it basically has a superpower. It can create as much money as it wants. Real, American money.

And the Fed doesn’t need anybody’s permission. It’s not like when the president says he wants to do something, like the American Jobs Act, and you have to ask, “What does Congress think?” Or when John Boehner wants to pass something, and you have to ask, “Well, what does Harry Reid think?” Once the Board of Governors decides to move forward, they don’t need 60 votes in the Senate — they just do it. And that makes them incredibly powerful.

But, as Spider Man would say, with great power comes great responsibility. And so the Fed is very cautious in using its powers.

By law, it needs to try to keep unemployment and inflation low. Over the past two years or so, inflation has stayed low, and unemployment has been very, very high. But the Fed has not been doing all that much about it. It’s been hoping the situation would turn around of its own accord, or that Congress and the president would stop bickering and unleash more stimulus — anything so that the Fed didn’t have to further unleash its powers.

But it didn’t happen. And so, on Thursday, Fed Chairman Ben Bernanke said the Fed had finally decided to do something about unemployment. Something big. Something that might actually work.
…

Gollum Sux recommends QE3-fueled home builder stocks as a good bet.

Sadly, four-out-of-four of their recommendations are tanking today.

4 housing stocks Goldman likes
September 18, 2012, 9:35 AM

Goldman Sachs weighed in with a bullish note on the housing sector on Tuesday morning and pointed out its top four picks for clients given what the firm called the sector’s “long list of positives.”

Among the highlights from the note:

“Our confidence in our forecast for a 20-30% housing activity growth for each of the next few years has risen”

“The FHFA, the conservator for Fannie Mae and Freddie Mac, is clarifying, improving, and easing its representation and warranty procedures for lenders – this has been the biggest impediment to residential loan growth.”

“In addition to the important rep & warranty change, other policy measures like QE3 and the REO to Rental program have been positive for the housing market even as the precursors to a better demand recovery take hold”

“Home prices continue to improve, inventory remains low, and the risk of a major foreclosure wave is shrinking further.”

“Recent capital raises and a study of market share by MSA for our homebuilder coverage universe suggest that large public homebuilders should continue to take market share.”

“Our favorite stocks to take advantage of the improving housing market are (MDC -0.16%) (Americas Conviction List) MDC, KB Home (KBH -0.68%), PulteGroup (PHM -0.25%) and Toll Brothers (TOL -0.28%).”

-Greg Morcroft

Happy days are here again in the home building sector!

Sept. 18, 2012, 10:00 a.m. EDT
NAHB builders index hits 6-year high in September
By Steve Goldstein

WASHINGTON (MarketWatch) - Optimism from home builders climbed in September for the fifth straight month to reach the highest level in more than six years, according to a closely followed index released Tuesday. The National Association of Home Builders/Wells Fargo housing market index gained 3 points to a seasonally adjusted reading of 40, the highest the index has been since June 2006. Economists polled by MarketWatch anticipated a reading of 38. The index is still not at the 50 level indicating “good” conditions but has climbed from as low as 8 during the recession. The index didn’t even break 20 until December 2011.

Here’s your Tucson housing market update:

What the creators of this brilliant program seem to forget is that you can’t magically build more tenants. Only so many in any given market.

We are tumbling into a deeper recession.

Can obama blame obama?

—————————–

FedEx says economy is worsening, cuts outlook
LA times | 9/19/12 | Associated Press

FedEx Corp. says the global economy is worsening and it’s cutting its forecast for the fiscal year ending in May.

The world’s second largest package delivery company also said Tuesday that net income for the current quarter ending in November should fall well below last year’s quarter. The stock lost about 2 percent in premarket trading.

FedEx is seeing a drop in demand for more expensive priority services. As the global economy has slowed, FedEx customers have switched to cheaper deferred delivery services. FedEx hasn’t been able to cut costs fast enough to match the decline in demand.

Comment by Happy2bHeard
2012-09-16 17:12:05

I rent in a close in suburb of Seattle. 3-4 BR houses on small lots. I expect these neighborhoods will fall more slowly than those further out. The housing and infrastructure lend themselves to greater density.

Hey Happy2bHeard,

I totally agree with your assessment.

What ‘burb are you in, btw? I didn’t realize you were local. I live in Phinney. Any interest in a Seattle-area meet-up? We haven’t had one of those in many years, so we’re overdue…

Seeing as all the gun sales go through the roof I was struck by this article about the Bobwhite quail and it’s micro-economic effects of one segment of the bio-sphere. Is it such a leap of faith to contemplate that on a planet wide macro scale the by-products of our industrial, consumption based economies will cause massive disruptions in the climate?

“In 1960, 321,000 Texas quail hunters bagged 98 million birds. In 2010, there were fewer than 50,000 hunters and the harvest was around a half million quail.”

http://www.star-telegram.com/2012/09/17/4266983/bobwhite-quail-a-vanishing-breed.html#storylink=cpy

I am left with the thought that maybe some of these new gun owners won’t be hunting wildlife but are more interested in hunting their political opponents. Notice I’m not labeling the gun owners as left or right, it’s happening on both sides.

I thought this article was an interesting rebuttal to all of those who advocate that the unemployed should have gotten their degree in STEM subjects.

http://seattletimes.com/html/nationworld/2019185996_koreajobs18.html

“With almost three out of four high-school students going to college in an effort to get a top-paying job in one of the leading industrial groups, known as chaebols, South Korea is being flooded with more college graduates than it needs. Its 30 biggest companies hired 260,000 of them last year, leaving another 60,000 to swell the youth-unemployment rate to 6.4 percent in August, more than twice the national average.

The government’s response is a U-turn from decades of increasingly competitive and expensive education that made South Korea No. 1 in the world for academic qualifications. President Lee Myung-bak’s new message to many high-school students is: Skip college and go to work.”

The Obama/Romney Pimp List

GO!

Brazil’s real estate bubble is the center of conversations in bars, restaurants, and barber shops. There is no way out.

Despite the fact that many informed Brazilians are aware about the issue, the overwhelming majority of the population isn’t. And this occurs not only because of their ignorance, but also because of the mass misinformation that is constantly broadcasted by the media. Brazilian “experts” like economist Ricardo Amorim (nicknamed “Cement Index Guy”) or the high-profiled Luis Carlos Mendonça de Barros (“Mendonção,” a protagonist of the Telecom privatization scandal), swear by their mothers that there is no housing bubble and will never exist in our country. And these two are merely exemplary. Brazil’s entire media is “campaigning” against a housing bubble, obviously. No news there.

But what is a real estate bubble? The “herd” says that it’s when the total housing credit to individuals achieves very high rates relative to the GDP of a country. Hence, they say, there is no bubble because Brazil’s mortgage/GDP ratio is only 5%. But this concept is a fallacy – it helps the “herd” to justify the high prices.

The real definition of a bubble is when property prices rise faster than (and decouple from) wage income growth, fueled by governments and bankers pushing and motivating this same population to continue buying. And the bureaucrats do that by either lowering interest rates or increasing financing terms (just compare the current 35-year terms against the standard 15-year in 2004). Just look at how our property prices doubled or tripled in a 4 or 5 years and you’ll have an idea of what a bubble really means.

http://brazilianbubble.com/a-brief-history-of-the-brazilian-real-estate-market-and-why-the-bubble-may-have-started-to-burst-last-march/

One for Rio, hope he’s a renter.

But one important fact gives me a very strong indication that the bubble has already burst last March: mortgage defaulters (SFH/BC).

Over 90 days / Up to 90 days
Jun/11 – 59,139 / 97,368
Jan/12 – 53,977 / 102,935
Jun/12 – 52,765 / 184,402

Hope and change wins again…

————————–

Obama wins right to indefinitely detain Americans under NDAA
Russia Today | 9/18/12

A lone appeals judge bowed down to the Obama administration late Monday and reauthorized the White House’s ability to indefinitely detain American citizens without charge or due process.

Last week, a federal judge ruled that an temporary injunction on section 1021 of the National Defense Authorization Act for Fiscal Year 2012 must be made permanent, essentially barring the White House from ever enforcing a clause in the NDAA that can let them put any US citizen behind bars indefinitely over mere allegations of terrorist associations. On Monday, the US Justice Department asked for an emergency stay on that order, and hours later US Court of Appeals for the Second Circuit Judge Raymond Lohier agreed to intervene and place a hold on the injunction.

Would this be a good time for dips to buy?

Sept. 18, 2012, 12:32 p.m. EDT
Why dips will stay shallow
By Jeff White

The old adage is true: The trend is your friend until it ends.

Right now, the trend is up, and there’s no arguing that. And at some point, it will end, and the sledding will become tougher. However, since the June lows, every single dip has been bought. That has created a series of higher lows on the daily chart of the Standard & Poor’s 500 Index which remains intact.

Yet there’s more to it than that.

Aside from the most important element (price) pointing the way higher, there’s the prevailing mood — the mindset of market participants. On the one hand are the bulls, and the other the bears, and while they may have different motives, they’re both likely to be buyers for a little while.

Bears as buyers? Yes. They’ve had no satisfaction in recent months, and a ton of frustration. They become buyers when their hope is lost and the pain is immense, so they lose patience and give up. As poise goes out the window, it ushers in panic. Their survival hinges upon the preservation of their accounts, and in order to achieve that, they have to limit losses just as the bulls do in a market decline. The bears are all underwater at this point in the rally, and therefore they’ll be eager to cover shorts into virtually any weakness. That makes them net buyers.

We’ve seen a similar shift occur with bulls during previous market selloffs when those caught on the wrong (long) side view all bounces as opportunities to end the pain. Right now, it’s that way with the bears, as their confidence is running extremely low.

And the bulls, well, of course, they’re buyers too. The many who haven’t fully caught this move are eager to jump on board by putting cash to work into any discount or pullback. Alongside those who simply want to participate are the money managers and fund managers who are underperforming and simply cannot afford to miss out on any more upside — especially with the end of the year approaching. Underperformance in January or February can be made up, but it gets much tougher into September and October with the pressure of the calendar.
…

Way to go Ohbewanna…

Alpha closing 8 mines, cutting 1,200 jobs in all

Coal producer Alpha Natural Resources said Tuesday it was cutting production by 16 million tons and eliminating 1,200 jobs companywide, laying off 400 workers immediately by closing mines in Virginia, West Virginia and Pennsylvania.

http://seattletimes.com/html/nationworld/2019187163_apusalphalayoffs.html

Oil Price Flash Crash or bad economy ahead ?

“We have made the point that the actions by the Fed and the ECB are in response to a global economy that is floundering not flourishing. The equity and other markets have rallied due to all of the announced and expected easing measures, predicated on a belief that consumption and economic growth will necessarily follow due to extremely low interest rates and/or the positive effect of inflation on asset values.

Still, it was an odd epiphany that struck the energy market in a moment.

Prices seemed to collapse of their own weight, due to a buyer’s strike. The demand outlook for next year has deteriorated markedly, and just this morning FedEx (FDX) has reduced its outlook for the all-important Holiday quarter.

The Fed has done all that it can, but the fiscal side needs to come through, and we won’t get that until after the November election, possibly well after. “

Alad?

$7 Million In Gold Bars Found In Reclusive Man’s Home Month After He Died

http://lasvegas.cbslocal.com/2012/09/17/7-million-in-gold-bars-found-in-reclusive-mans-home-month-after-he-died/

Posted: 9:23 a.m. Tuesday, Sept. 18, 2012

More Florida companies try to cancel mortgage debt with lawsuits

By Kimberly Miller

Palm Beach Post Staff Writer

More companies are jumping into the land trust business.

At least two new firms in Florida are trying to cancel mortgage debt with lawsuits that lenders call “baseless” and “nonsensical” but that some borrowers say are their last chance at keeping their homes.

The companies, including one with a Jupiter address, are in addition to the Fidelity Land Trust Company that opened last year in Boca Raton. Together, they have filed scores of lawsuits statewide and collected hundreds of deeds from homeowners, who are typically solicited by phone because they have underwater mortgages.

And desperate borrowers are biting.

Lee County homeowner Tom Meyers contracted with Heritage National Land Trust last month, signing over the deed to his house and writing checks for about $11,000, he said.

He will be delinquent on his estimated $560,000 loan as of Friday, using the money for his mortgage to pay the trust instead. After trying for years to get a loan modification following a divorce that left him with one income and an upside down loan, he felt the land trust was his only option to keep the house.

“They’ve done everything they’ve said they would do so far,” Meyers said about the trust. “I made it clear I better see some results.”

Jupiter-based Heritage National Land Trust registered with the state in July and has since collected 33 deeds, including 17 in Palm Beach County.

The business model of the trusts varies, and according to websites, includes cash-for-keys options.

But in one scenario, the homeowner signs over his deed to the trust and pays a fee for paperwork and legal representation. The trust then sues the lender to cancel the mortgage for alleged improprieties, such as not recording the transfer of the mortgage or violations of pooling and servicing agreements.

Once the mortgage is canceled, the homeowner still owes the debt — or note — to the bank, but the trust tries to negotiate down the amount owed and buy the note at a discount. The homeowner then takes out a new mortgage or arranges for another payment plan with the trust.

Some attorneys and title agents are skeptical of the maneuver, saying it’s not legally sound and relies on the banks not responding to the lawsuit. They fear homeowners will pay for the land trust service while going further in debt to their lender and have nothing to show for it at the end.

“To think you as a downstream interest holder can destroy a prior creditor or interest holder’s rights in the property flies in the face of logic,” said Greg Clark, a Clearwater title and foreclosure defense attorney. “The basic premise is flawed.”

But proponents of the trusts point to a Levy County case they say proves it works.

A press release issued Tuesday by one of the trust referral companies says Boca Raton attorney Howard Feinmel, who is under a Florida Bar investigation for issues relating to quiet title lawsuits, won a judgment in November that canceled a mortgage. It was a default judgment, typically awarded when the defendant fails to respond within 20 to 30 days and can be reopened if there are legitimate reasons for missing the deadline.

The plaintiff in the Levy County case was Levy County Partners, which had the homeowner deed his house to it before filing the lawsuit, according to property appraiser records. The deed has since been transferred from Levy County Partners to Fidelity Land Trust Company. The foreclosure lawsuit against the homeowner was voluntarily dismissed in June by the lender. The dismissal was done without prejudice, meaning it can be re-filed.

Bank of America, the servicer on the loan, did not respond to a request for comment.

Fidelity Land Trust Company, which was incorporated in December and is believed to be one of the first firms to make widespread attempts to cancel mortgages by suing the banks, has amassed about 240 deeds statewide, including 100 in Palm Beach County.

Sunshine State Land Trust Company registered with the state in June with a Miami mailing address. Although it doesn’t appear to have filed any lawsuits, Fidelity Land Trust has signed several of its deeds over to Sunshine, including 15 in Palm Beach County.

AAF Investments Land Trust Company isn’t a registered corporation under that name with the Florida Department of State, but has had four Palm Beach County homeowners sign deeds to it and filed two lawsuits, according to the Palm Beach County Clerk of Courts office.

The machinations of the deals can be complicated. For example, Palm Beach Gardens homeowner Ralph Jimenez said he was contacted by the North Palm Beach-based Lincoln Property Consultants about turning his deed over to the company in exchange for cash after a sale. Property records show he signed his deed over to the Fidelity Land Trust Company in March. It was signed back to him by Fidelity July 30. Jimenez said he was told it was signed back to him so it could be transferred to the Heritage National Land Trust, but clerk records show he signed it to a company called Floridian Asset Management Group on July 18.

“What’s the worst that can happen?” said Jimenez, adding that he has not paid any fees to the companies.

A message left at a phone number for Heritage National Land Trust was not returned. The law practice that has been representing AAF Investments Land Trust said it no longer represents the firm and couldn’t give out client contact information.

Paul Gellenbeck, managing director of the Fidelity Land Trust, said land trust matters are confidential and declined to comment.

Lenders have asked the federal court to hear cases filed in Palm Beach County by Fidelity and Heritage.

One of the cases, filed by Heritage, attempts to cancel a 2007 mortgage for $447,792 on a Jupiter home. The homeowners signed their deed over on April 12 and Heritage filed its lawsuit June 5.

Attorneys for the bank said the lawsuit is “baseless,” “meritless” and “nonsensical.”

“This case is an example of a disturbing new trend among borrowers in Florida who deed their homes, which are either in foreclosure or soon will be, to a trust (of which they are purportedly the beneficiary) and then bring suit to quiet-title and invalidate the mortgage,” the bank’s motion to dismiss says.

In the Fidelity case, bank attorneys wrote: “Fidelity’s modus operandi is to bring meritless declaratory judgment and quiet title actions in hopes that the lender will miss the answer deadline and default.”

Fidelity voluntarily dismissed that suit last month.

Updated: 7:41 p.m. Tuesday, Sept. 18, 2012 | Posted: 7:35 p.m. Tuesday, Sept. 18, 2012

AMR expects about 4,400 job cuts, warns 11,000

By DAVID KOENIG

The Associated Press

DALLAS —
American Airlines is sending layoff warning notices to more than 11,000 employees although a spokesman says the company expects job losses to be closer to 4,400.

The notices went out to mechanics and ground workers whose jobs will be affected as American goes through a bankruptcy restructuring.

American Airlines spokesman Bruce Hicks said Tuesday that fewer than 40 percent of those getting notices will lose their jobs. Hicks said federal law requires the company to notify anyone whose position could change, including those who could get “bumped” by more-senior employees whose jobs are eliminated or outsourced.

American said in February that it planned to cut 14,000 jobs, including 13,000 held by union workers. But if Hicks is right, the final job losses will be about a third of that.

Over the summer American accepted slightly smaller cost-cutting measures as it negotiated new labor contracts, and it agreed to give bonuses to flight attendants and ground workers who quit. So far 1,800 flight attendants and 800 ground workers have applied to take the money and leave.

Layoff notices went to nearly 3,000 workers in the Dallas-Fort Worth area, where a maintenance facility will close, and nearly 3,000 more at a base in Tulsa, Okla. Also receiving notices were about 1,200 workers in Miami, 1,100 in New York and Newark, N.J., 900 in Chicago, and smaller numbers elsewhere.

“As bad as this is — and we knew this day was coming — we’ve been able to lessen the pain,” said Jamie Horwitz, a spokesman for the Transport Workers Union.

Separately, the leader of the pilots’ union blasted the company, saying it is “paying lip service” to negotiating a contract while using the bankruptcy process to wring punitive cost-cutting concessions from pilots.

Eight other labor groups approved long-term contracts that will help AMR cut annual labor spending by about $1 billion. Pilots, however, voted overwhelmingly against the company’s last contract offer, and a federal bankruptcy judge allowed American to impose new pay and working rules on pilots.

The acting president of the Allied Pilots Association, Keith Wilson, said in a message to members that he would meet this week with Transportation Secretary Ray LaHood and other senior officials in the Obama administration and Congress. The union has asked federal officials to approve steps that could eventually lead to a strike, but that permission hasn’t been granted.

Hicks said American is ready to resume negotiations “when the union is ready.”

Still, pilots are holding a strike-authorization vote. And according to the company, they are calling in sick more often than usual, contributing to an increase in canceled flights. American has trimmed its September and October schedule by up to 2 percent to make sure it has enough pilots to operate flights.

Hunter Keay, an analyst for Wolfe Trahan & Co., said he does not think the threat of cancelations will lead travelers to avoid American. But he said there has been “a clear deterioration in labor relations” at American.

An American merger with US Airways Group Inc. could produce a bigger airline with more revenue and more labor peace, Keay said. US Airways has lobbied for a merger but American executives have been reluctant.

American and parent AMR Corp., which is based in Fort Worth, filed for bankruptcy protection in November.

Here is a prediction, and you all may ask me to I eat my words if it proves incorrect:

The candidate who unrepentantly labeled 47% of the U.S. population as losers is destined to lose badly in November 2012 — karmic comeuppance and all that.

Sept. 18, 2012, 6:00 p.m. EDT
Mitt Romney vs. tax-avoiding freeloaders
Commentary: Republican candidate writes off 47% of the country
By Rex Nutting, MarketWatch

WASHINGTON (MarketWatch) – Clint Eastwood made history by demolishing an imaginary president in a debate. Mitt Romney has gone Eastwood one better: He’s conjured up an imaginary country, one in which half of the people don’t matter.

And he’s not going to debate them; he’s totally ignoring them.

You remember Herman Cain’s 9-9-9 plan? Mitt Romney, has his own political numerology: The 47-47-47 theory.

Mitt Romney said he wouldn’t even try to get the votes of the 47% of the country that are moochers.

Romney told a group of wealthy donors last spring that America was deeply divided: Nearly half of the people — 47% to be exact — were essentially living off the government’s largesse, while the rest contributed to America’s greatness. Forty-seven percent paid no income taxes, 47% thought the government owed them a cushy life on a silver platter, and, not-so-coincidentally, 47% liked Barack Obama. Read more at Mother Jones.

According to Romney’s math, about half the people — 47% to be exact — are tax-avoiding, government-dependent, deadbeat Democrats. A roughly equal number are tax-paying, hard-working, clean-living Republicans. And maybe 5% or 10% are misguided centrists who let emotion get the better of them in 2008. For another viewpoint, read Rep. Allen West’s column on the 47%.

Romney said he wasn’t even going to try to get the votes of the freeloading 47%.

“My job is not to worry about those people,” Romney said in a video of the remarks. “I’ll never convince them they should take personal responsibility and care for their lives.”

Why bother? Now that they had become addicted to living off the rest of us, they could never be saved. They would never vote Republican again.

Giving up on the 47% must have been a very tough decision for Romney to make. After all, he’s the head of a grand old party whose first and greatest president tried to a heal a nation divided against itself. But Lincoln’s successor, Mitt Romney, instead expresses malice toward 47%.

And Joseph Smith, the founder of Romney’s faith, prophesied about a community in which everyone seeks “the interest of his neighbor,” dreamed of a place where everyone shares equally and receives justly “according to his wants and his needs.” Romney’s own wife, Ann, was once president of the local branch of the LDS Relief Society, an organization with the sole purpose to help the very moochers Romney doesn’t have to worry about.

It’s going to be a tough sell trying to persuade an 85-year-old widow who lives on a meager Social Security check too small to tax that she should vote Republican. She’s on the dole, poor dear, and can’t be reached any more.

And it’s hard to talk a single mother who’s trying to get off welfare by working a minimum-wage job into finally take some responsibility for her life.

Or about convincing a hedge-fund manager with a really good tax guy that, if you don’t pay any taxes, you’re a leech. No, wait. Scratch that last one. I forgot … it’s OK for job creators to pay nothing.

Anyone who’s paid attention knows that Romney didn’t misspeak when he characterized nearly half of the nation as losers. Romney is proud of what he said.

While Romney admitted that his presentation was a little rough, “it’s not elegantly stated, let me put it that way,” he stood by his premise.

“It’s a message which I’m going to carry and continue to carry, which is look, the president’s approach is attractive to people who are not paying taxes because frankly my discussion about lowering taxes isn’t as attractive to them.”
…

Romney calls QE3 another ‘bailout’ for Obama economy
September 13, 2012, 3:54 PM

The campaign of Republican presidential nominee Mitt Romney called the Federal Reserve’s third round of quantitative easing another “bailout” for President Barack Obama’s economy on Thursday, while other GOP members wondered whether Fed Chairman Ben Bernanke was doing the administration’s bidding by calling for the jolt to the economy.

Shortly after the Fed announced it would purchase $40 billion in mortgage-backed securities each month, Romney campaign policy director Lanhee Chen said in a press release: “The Federal Reserve’s announcement of a third round of quantitative easing is further confirmation that President Obama’s policies have not worked. After four years of stagnant growth, falling incomes, rising costs and persistently high unemployment, the American economy doesn’t need more artificial and ineffective measures. We should be creating wealth, not printing dollars.”
…

Sept. 15, 2012, 4:59 p.m. EDT
Ryan: Fed plan a ‘bailout’

OLDSMAR, Fla., Sep 15, 2012 (UPI via COMTEX) — U.S. Republican vice presidential nominee Paul Ryan said Saturday the Federal Reserve plan to buy mortgage-backed securities shows “we don’t have a recovery.”

Speaking at a campaign rally in Oldsmar, Fla., the Wisconsin congressman called the Fed policy “sugar high economics.”

“We heard that the Federal Reserve is coming with a new bailout,” Ryan said. “So the Federal Reserve is basically saying that we don’t have a recovery. ‘Obamanomics’ didn’t work.”

The Fed policy announced Thursday is the third round of so-called quantitative easing, in which the central bank buys bonds — but it differs from previous rounds in that Fed Chairman Ben Bernanke said it will remain in place until it produces satisfactory growth in employment, The Hill reported.

“We don’t need synthetic money creation. We need economic growth. We want wealth creation,” Ryan said at the campaign event. “We don’t want to print money. We want opportunity and growth.”

Danny Kanner, a spokesman for President Barack Obama’s re-election campaign said Ryan “has no credibility when it comes to helping the middle class.”

“The Romney-Ryan plan is to raise taxes on middle class families by cutting benefits like the mortgage interest deduction, the child tax credit, and the charitable deduction to pay for $250,000 tax cuts for multimillionaires like Mitt Romney,” Kanner said.
…

Got 3:1 odds against Romney?

Price History
PRES12_WTA
Date Contract Units $Volume LowPrice HighPrice AvgPrice LastPrice
09/17/12 DEM12_WTA 2,353 1,696.725 0.680 0.750 0.721 0.750
09/17/12 REP12_WTA 1,284 367.338 0.270 0.299 0.286 0.270

Odds against Romney based on DEM12_WTA 09/17/12 closing price:

0.750:0.250 => 3:1

Odds against Romney based on REP12_WTA 09/17/12 closing price:

0.730:0.270 => 8:3 (slightly below 3:1 against Romney win of popular vote).

“A tough three weeks…”

Ya think!?

Jansing and Co | Aired on September 18, 2012
A tough three weeks for Romney?

Democratic strategist Steve McMahon says Mitt Romney’s been acting like a “bumbling fool” while Republican strategist John Feehery says there’s still time for the Romney campaign to fix its missteps.

Obama jabs at Romney over his ‘47 percent’ remarks
By Jim Kuhnhennken Thomas on September 18, 2012

SALT LAKE CITY (AP) — President Barack Obama declared Tuesday night the occupant of the Oval Office must “work for everyone, not just for some,” jabbing back at Mitt Romney’s jarring statement that as a candidate, he doesn’t worry about the 47 percent of the country that pays no income taxes.

Romney neither disavowed nor apologized for his remarks, which included an observation that nearly half of the country believe they are victims and entitled to a range of government support. Instead, Romney cast his comment as evidence of a fundamental difference with Obama over the economy, adding the federal government should not “take from some to give to the others.”

As the rivals sparred with seven weeks remaining in a close race for the White House, two GOP Senate candidates publicly disavowed Romney’s remarks, caught on videotape at a fundraiser. Republican officials openly debated the impact that a series of controversies would have on the party’s prospects of winning the presidency.
…

Secret lives of Republican base members:

Romney “47 Percent” Fundraiser Host: Hedge Fund Manager Who Likes Sex Parties
—By David Corn | Mon Sep. 17, 2012 5:48 PM PDT

Marc LederMarc Leder, left, hosted a fundraiser for Mitt Romney at his Boca Raton home on May 17, 2012. Leder: Sun Capital Partners; Romney: Tina Fultz/Zuma

When Mitt Romney at a private fundraiser dismissed all Barack Obama voters as moochers and victims—showing disdain for nearly half of the American electorate—he was speaking at the home of controversial private equity manager Marc Leder in Boca Raton on May 17, 2012. (It was Romney’s second fundraising event in Boca that day.) This is evident from references made by Romney within the full video recording of the event that has been reviewed by Mother Jones.

When Mother Jones first disclosed secret video of Romney’s remarks, we were obliged to not reveal details regarding the time and place of the event. That restriction has been lifted, as the story has garnered attention throughout the media.

At the fundraiser, Romney was asked how he could win in November, and he replied:

There are 47 percent of the people who will vote for the president no matter what. All right, there are 47 percent who are with him, who are dependent upon government, who believe that they are victims, who believe the government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you-name-it. That that’s an entitlement. And the government should give it to them. And they will vote for this president no matter what…These are people who pay no income tax…[M]y job is is not to worry about those people. I’ll never convince them they should take personal responsibility and care for their lives.

Romney made those remarks before donors who had paid $50,000 a plate to attend the dinner at Leder’s swanky house.

Leder has long been a fan of Romney. In January, the New York Times reported:

Years ago, a visit to Mr. Romney’s investment firm inspired Mr. Leder to get into private equity in the first place. Mr. Romney was an early investor in some of the deals done by Mr. Leder’s investment company, Sun Capital, which today oversees about $8 billion in equity.

The paper noted that Leder is something of a poster boy for private equity—and not in a good way:

Mr. Leder personifies the debates now swirling around this lucrative corner of finance. To his critics, he represents everything that’s wrong with this setup. In recent years, a large number of the companies that Sun Capital has acquired have run into serious trouble, eliminated jobs or both. Since 2008, some 25 of its companies—roughly one of every five it owns—have filed for bankruptcy. Among the losers was Friendly’s, the restaurant chain known for its Jim Dandy sundaes and Fribble shakes. (Sun Capital was accused by a federal agency of pushing Friendly’s into bankruptcy last year to avoid paying pensions to the chain’s employees; Sun disputes that contention.) Another company that sank into bankruptcy was Real Mex, owner of the Chevy’s restaurant chain. In that case, Mr. Leder lost money for his investors not once, but twice.

But Leder does differ from Romney in one significant fashion: how he likes to have a certain sort of fun. In August 2011, the New York Post reported,

It was as if the Playboy Mansion met the East EBond at a wild party at private-equity titan Marc Leder’s Bridgehampton estate, where guests cavorted nude in the pool and performed sex acts, scantily dressed Russians danced on platforms and men twirled lit torches to a booming techno beat. The divorced Sun Capital Partners honcho rented a sprawling beachfront mansion on Surf Side Road for $500,000 for the month of July. Leder’s weekly Friday and Saturday night parties have become the talk of the Hamptons—and he ended them in style last weekend with his wildest bash yet. Russell Simmons and ex-wife Kimora Lee attended a more subdued party thrown by Leder—who’s an event chair for Simmons’ Art For Life charity—on July 29 together. But the revelry hit a frenzied point the next day before midnight when a male guest described as a “chubby white meathead” and a “tanned” female guest stripped and hopped into the pool naked.

At Romney’s fundraiser at Leder’s Boca Raton home, not a single sex act was recorded.

Fed’s latest stimulus may have little impact on mortgage borrowers
By Danielle Douglas and Brady Dennis, Tuesday, September 18, 6:08 PM

The Federal Reserve took aim at the nation’s wobbly housing market last week with its biggest stimulus action in two years, but that firepower is doing little to lower mortgage rates or make home loans more available for Americans.

Instead, banks are set to see a windfall since the Fed’s actions will immediately lower the cost of issuing loans. It may take months or longer for benefits to trickle down to consumers, analysts say.

The emerging scenario highlights the limitations of the Fed’s ability to jump-start the housing market on demand: Rather than intervene directly with consumers, the Fed must rely on banks, brokers and other industry actors to offer borrowers better terms.

Banks say they are keeping rates high right now because lowering them any further would overwhelm them with customers. They say that over time, as volume thins out, rates could come down to attract new borrowers.

“Bank of America, Wells, Chase, whomever, have fixed capacity. You can’t take in more loans than you can handle,” said Matt Vernon, a senior mortgage executive at Bank of America.
…

Fed’s asset purchases are ‘charade,’ Yale professor says

Sep. 18, 2012 - Stephen Roach, a professor at Yale University and former non-executive chairman for Morgan Stanley in Asia, talks about the decision by Federal Reserve policy makers to proceed with a third round of large-scale asset purchases, inflation in the U.S. and the Chinese economy. (/Bloomberg)

This gaffe definitely takes the cake — crab or otherwise.

Generally being far less than enamored of politicians as a breed, this kind of blatant error leaves me barely able to contain my glee.

Op-Ed Columnist
Let Them Eat Crab Cake
By MAUREEN DOWD
Published: September 18, 2012
WASHINGTON
Fred R. Conrad/The New York Times

Oh, for the days when we thought Mitt Romney didn’t stand for anything.

As a secret video from a Boca Raton fund-raiser with high rollers in May shows, Romney in private stands for so many bizarre things that it’s hard to tell what’s crazier — his domestic policy or his foreign policy.

Less than 50 days before the election, we learn that Romney may have given up on half of America and on Mideast peace.

In a reply to a fat cat at the $50,000-a-plate dinner, he wrote off 47 percent of the country as deadbeats, freeloaders and “victims” who feel they’re entitled to stuff — stuff like basic sustenance.

“Well, there are 47 percent of the people who will vote for the president no matter what,” he said. “All right? There are 47 percent who are with him. Who are dependent upon government, who believe that they are victims, who believe that government has a responsibility to care for them, who believe that they’re entitled to health care, to food, to housing, to you-name-it.”

The candidate, who pays so little in taxes relative to his income that he has to hide tax returns and money in Switzerland and the Cayman Islands, then added, condescendingly: “These are people who pay no income tax.”

“So my job is not to worry about those people,” he blithely concluded. “I’ll never convince them that they should take personal responsibility and care for their lives.” What kind of presidential candidate shrugs off wooing whole groups — we’re talking many seniors and white-working-class voters in battleground states who are, if he actually knew what he was talking about, his own natural constituencies?

A “stupid and arrogant” one, as Bill Kristol, the editor of The Weekly Standard, put it.

Conservatives knew that Romney was no Reagan, but the tape left many Republicans and Obama strategists gobsmacked. One top Democrat called it “a treasure trove of stupid answers.”
…

“But they should be concerned about the fundamental inaccuracy of Romney’s claims and the erroneous conclusions he draws from them.”

Why would the party of lies and propaganda give a hoot about fundamental inaccuracies in their statements? Their primary campaign strategy is to bamboozle an ignorant American electorate with lies and deceptions.

Debunking Romney’s attack on Americans who don’t pay income taxes

Most people who ‘pay no income tax’ are working or have worked in the past, including seniors living on Social Security and Medicare benefits they paid for during their working lives.

Business columnist Michael Hiltzik and Politics Now blog host Jim Rainey discuss the furor that Mitt Romney set off with his comments about the “47%.”

By Michael Hiltzik

September 19, 2012

By now, most Americans who take their civic responsibilities seriously have no doubt seen, or at least heard about, Mitt Romney’s peculiar approach to broad-based voter outreach.

We’re referring, of course, to his videotaped fundraising speech in Florida, in which he characterizes 47% of the American public as people who are “dependent on the government,” who “pay no income tax” and who can’t be convinced to “take personal responsibility and care for their lives.”

Voters can decide for themselves whether Romney’s words, taken at face value, bespeak a hopelessly crabbed approach to government’s role in our lives or a principled stand for private enterprise and economic freedom.

But they should be concerned about the fundamental inaccuracy of Romney’s claims and the erroneous conclusions he draws from them. For those point to the important questions of how he can make policy in a fact-free context, and how he can even know his own mind if he doesn’t know what he’s talking about.

So let’s examine Romney’s numbers and their significance.

The key number he cited is that 47% of Americans “pay no income tax.” The statistic is true as far as it goes, but it doesn’t come close to reaching the finish line. In fact, its shock value derives from the legerdemain of focusing solely on the federal income tax. This misleads Romney and his audience into thinking that the group in question is mostly people on a lifelong dole.

The truth is that the vast majority are people who are working or who have worked in the past. Their ranks include millions of Americans who are now retired, living on Social Security and Medicare benefits they paid for throughout their working lives. Many others are those who were booted into culverts by the economic crisis and are today struggling to get back on the road.
…

San Diego Approves Abandoned Property Ordinance
By Mike Wille
Story Published: Sep 18, 2012 at 7:39 PM PDT

SAN DIEGO (CNS) - The San Diego City Council unanimously passed an ordinance Tuesday requiring owners of abandoned homes to keep their properties in reasonable condition.

Under the new regulations, the city can send code enforcement officers to vacant houses and fine the owners — in many cases, banks. The regulations close loopholes that allowed abandoned properties to languish for years.

“This is a good thing,” Councilwoman Lorie Zapf said. “We’ve had some problematic areas in our districts. Some of them took months and months and months (to fix).”

The previous regulations only applied to vacant properties that were boarded up or unsecured.

City staff said vacant properties eventually become blighted, are fire hazards and crime magnets, and lower values of surrounding properties. Owners of blighted vacant properties could be prosecuted for misdemeanors under the new ordinance, or be held civilly liable.

Owners will be required to — among other things — secure doors and windows of abandoned houses, maintain landscaping, clear debris and erect barriers to discourage illegal littering.

A second proposed law targeting banks was scheduled to be taken up at a special night council session.

The Responsible Banking Ordinance would have banks with which the city of San Diego does business file reports on neighborhood lending practices.

The plan by council President Tony Young would have banks submit annual data on their home and small business lending, modifications of distressed loans, foreclosure information, community investment, employment diversity and their number of jobs.

Young also wants two-year community reinvestment plans to be submitted for residential and small business lending in low- and moderate-income neighborhoods.

His proposed ordinance also calls for the city to establish a Community Reinvestment Review Committee made up of council members and mayoral staff to recommend which banks should receive city deposits and handle financial transactions.

Several other large cities have similar requirements, and Los Angeles adopted a similar law earlier this year, Young said.

Economic stakes high in China-Japan islands dispute

Trade between the global powerhouses is likely to suffer, and Japan may focus on other regions, after China’s violent protests over islands both nations claim.

By Julie Makinen, Los Angeles Times
September 18, 2012, 7:09 p.m.

BEIJING — The worst of the anti-Japanese protests that have swept China in recent days may be over. The financial fallout for the world’s second- and third-biggest economies may be just beginning.

Japanese-owned factories, restaurants, mini-marts and clothing retailers across China closed en masse Tuesday as protests continued in nearly 100 cities, sparked by a dispute over control of uninhabited islands near Taiwan.

Automakers Nissan, Honda, Toyota and Mazda suspended operations at some plants, as did Sony. Hundreds of 7-Eleven shops run by a Japanese company were shuttered, as were dozens of outlets of the popular Gap-like Japanese clothing chain Uniqlo. Eateries serving Japanese food — even those with Chinese owners and staff — closed as well, shaken by weekend demonstrations that saw protesters overturning Japanese cars, looting businesses and setting factories on fire.

Though domestic political pressure made it difficult for either side to compromise, neither appeared to be in the mood for an escalation either. China sent hundreds of police to the Japanese Embassy on Tuesday to monitor the crowd that gathered there, and many people received text messages from the police asking them to protest peacefully.

But with the world economy struggling, damage has already been done. One analyst predicted a “short, sharp downturn” in business dealings between two major global players.

The business closures and calls to boycott Japanese goods helped drive down the stock prices of many Japanese companies, including Nissan, which fell 5%; Honda, which dropped 2.5%; and Uniqlo parent Fast Retailing, which plummeted 7%. The shares of some Chinese companies with close ties to Japanese firms also fell.

“This is the worst we have seen,” said Tetsuo Kotani, a research fellow at the Japan Institute of International Affairs in Tokyo. “This could be a turning point for Japanese companies, making them reconsider the risks in China and leading them to diversify toward Southeast Asia, South America and Africa.”

Anti-Japanese sentiment has long existed in China, and authorities often have encouraged it. The recent demonstrations were the largest and most violent since 2005, when Chinese took to the streets over grievances that included a textbook they said downplayed accounts of Japanese brutality in China and elsewhere in Asia during World War II.
…

Wife and I are hosting a polling station in our garage on Election Day, 2012. Funny thing is, we both routinely mail in absentee ballots.

I guess some stimulus money just went to China production of solar panels ,in other words this translates to no job creation for Americans ,except for maybe when the units are installed in the USA .

I would venture to say that the units will have half the lifespan of
units produced elsewhere ,but the fact that they are cheaper will be the only thing considered . I’m just basing my opinion on all the other China junk I see coming in for a long time ,such as the toxic drywall
they were using during the boom from China .

But ,my main question is why all this BS about the USA losing millions of jobs to outsourcing and outmanufacturing .
In fact ,there is a issue of TREASON with this allowance of this level
of loss of jobs that floats all boats ,by the bought off Politicians .
50 years ago this would of been TREASON for a Politician to even suggest that this was acceptable .

The world labor market shouldn’t of been something that was for the taking by Industry ,and at least proper tariffs should of been charged .
The American people would not of gone for this had they known what was happening and all I can say is it was done in a such a manner that
people were out of touch with the degree it would affect the
American way of life and the job base here . The fake housing boom
delayed the obivious truth of how the American job base was being
gutted .

Why the American people aren’t more up in arms about it is beyond me .People say that Politicians can’t create jobs ,but they can certainly create laws and taxes that make it unfavorable for the gutting of jobs in America. The Politicians can penalize American Corporations that aren’t really feeding our job force .

I’ts just all so clear who is benefiting by Globalism ,and unless the world was playing by the same rules ,Globalism regarding labor markets and manufacturing isn’t rigged in favor of the worker ,or control of pollution and its producing toxic assult on the Planet . Does Wall Street care if it produces starvation in some Country by their speculation ? The great transfer of wealth to the 10% has in part been due to Globalism and nobody can say that it was earned the good old fashion way and without the exploiting of human labor .

ft dot com
Last updated: September 18, 2012 7:22 pm
Romney under fire from all sides
By Richard McGregor in Washington

Prominent conservatives joined Barack Obama in condemning Mitt Romney over leaked comments portraying the US president’s supporters as dependent on government, draining momentum from the challenger’s faltering campaign.

Mr Obama excoriated Mr Romney’s statement that said the president could count on the support of 47 per cent of Americans who rely on government, don’t pay tax and “believe they are victims”. The comments have been viewed 2.4m times online since the secretly recorded video was posted on Monday.

“One thing I’ve learned as president is that you represent the entire country,” Mr Obama said in New York on the Late Show with David Letterman, adding that very few people regarded themselves “as victims.”

But Mr Romney largely stood his ground in his first interview on the issue, saying so many Americans had fallen into poverty that “they’re not paying taxes and have to rely on government”.

“The right course to help them is not just to have government handing out but instead government helping people to get back to good jobs,” he said on Fox News.

Mr Romney also received better news on the polling front, with Gallup recording Mr Obama ahead by only 47 per cent to 46, evidence that the president’s post-convention bump has subsided.

Although some on the right urged Mr Romney to stand by his comments and amplify them on the campaign trail, William Kristol, of the conservative Weekly Standard, called them “arrogant and stupid”.

“Romney seems to have contempt not just for the Democrats who oppose him, but for tens of millions who intend to vote for him,” he wrote, referring to the many elderly people and families whose low incomes do not incur federal income taxes but support Republicans.

Two Republican Senate candidates, Linda McMahon, in Connecticut, and Scott Brown, in Massachusetts, distanced themselves from Mr Romney, saying the majority of Americans on welfare did not want to rely on government handouts.

The video clips, posted on the website of Mother Jones, a liberal magazine, upended Mr Romney’s campaign at a time when many Republicans fear their candidate is losing the election debate.

Speaking of the “47 per cent” of the population, Mr Romney said: “My job is not to worry about those people. I’ll never convince them they should take personal responsibility and care for their lives.”

In further excerpts from the video released on Tuesday, Mr Romney suggested that forging peace in the Middle East was not possible, nor was the establishment of a separate Palestinian state alongside Israel.
…

Jimmy Carter’s intergenerational revenge:

ft dot com
Carter grandson proud of Romney leak role
By Anna Fifield in Washington, Andrew Edgecliffe-Johnson, and Emily Steel in New York

For James Carter, a self-described opposition researcher, releasing videos of Mitt Romney belittling 47 per cent of Americans who pay no federal income tax was personal.

“I don’t like criticism of my family,” the 35-year-old said. Mr Romney has repeatedly used former Democratic president Jimmy Carter, Mr Carter’s grandfather, to make unflattering comparisons about incumbent Barack Obama, accusing both of being “weak” on foreign policy.

“It gets under my skin,” the younger Mr Carter told NBC News. “I’m proud of my role in being able to track [the source of the videos] down . . . My motivation is to help Democrats get elected.”

After Mr Carter emailed his grandfather the story about the tape, the elder statesman wrote back on Tuesday morning: “James: This is extraordinary. Congratulations! Papa.”

Mr Carter is unemployed and has said he has not been paid for his role in revealing the damaging video, filmed at a $50,000-a-head fundraiser hosted by Marc Leder, chief executive of Sun Capital Partners, in Florida in May.

Just before the Republican convention late last month, Mr Carter found a short clip from the fundraiser on YouTube and convinced the poster, “Anne Onymous”, to give the full video to David Corn, Mother Jones’ Washington bureau chief, who he had helped research previous coverage of Bain Capital’s dealings in China.

“There was a lot of negotiation about what we could do to protect the source’s identity,” Mr Corn told the Financial Times. “Because of my track record, the source obviously felt I could be trusted.”

“Anne Onymous” had tried to promote the video for months but it did not go viral, partly because clips appeared to have been selectively edited, leading to doubts about their authenticity.

It is a fair bet that few of the donors in Mr Romney’s audience are regular readers of Mother Jones. The San Francisco-based magazine took its name from an early 20th century labour activist and once employed Michael Moore, the outspoken liberal film-maker.

The non-profit publisher relies mostly on donations, topped up by subscriptions and some advertising revenue, and sells 240,000 copies of its bimonthly magazine.

The publication specialises in what Mr Corn called “muckraking” investigative exposes, often featuring corporate cover-ups, social injustices and environmental scandals. An appeal for donations on its website tells readers: “The rightwing lie machine is out of control this election. But Mother Jones is here to fact check politicians like Mitt Romney and Paul Ryan”.
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ft dot com
September 18, 2012 7:57 pm
Romney rescue plan – Cut the accountancy
By Lloyd Green

The campaign is not going well for Mitt Romney. The state of the electorate in mid-September is generally indicative of the election result seven weeks later. The former Massachusetts governor should be worried: he is behind in all but one of the swing states (North Carolina) and has written off the Americans who pay no federal income tax.

Consigning almost half – 47 per cent, to be as precise as Mr Romney is in a widely circulated video – of the possible vote to your opponent is not exactly a wise electoral strategy. Still, the election remains winnable for Mr Romney. But the road will be rocky and Mr Romney must offer a coherent rationale for his election if he intends to win. Saying that “I’m not the other guy” won’t do it.

He must convey his concerns about the middle class. This was his problem in the primaries and it remains his problem heading into the endgame. Simply calling for tax cuts for hedge fund gods isn’t working. Mr Romney unsurprisingly polls well with the relatively affluent. He holds a 16 point lead among those with incomes north of $90,000. His mission now is to correct his error and connect with middle income Americans.

For starters, Mr Romney should pivot away from attacking the 47 per cent who pay no federal income tax. Many are retirees who once paid taxes, spent a lifetime working and are the base of the Republican party. They predominate in resolutely Republican states, such as Texas, and in swing states, such as Florida.

Mr Romney must demonstrate self-awareness. He must acknowledge that he has succeeded in life and business. From there, he needs to address the fact that the middle class is being squeezed and then state that growth in America’s economy is the way out. Having benefited from Cayman Island shelters, he cannot castigate the have-nots. Rather, Mr Romney needs to say that America holds promise for all.
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Sept. 19, 2012, 12:00 a.m. EDT
QE3 is much ado about nothing
Commentary: Monetary ease is not the cure for what ails us
By Irwin Kellner, MarketWatch

PORT WASHINGTON, N.Y. (MarketWatch) — Like it or not, the burden of strengthening the fragile recovery has fallen on the shoulders of Ben Bernanke and his colleagues at the Federal Reserve. This is unfortunate, since the Fed’s record shows how ineffective it has been at this task.

Over the past four years, the central bank has cut its overnight lending rate to zero, bailed out the banks, bought loads of long-term Treasurys as well as mortgage-backed securities in an effort to resuscitate the economy and thus lower the jobless rate, but to no avail.

The economy may not be tumbling the way it was four years ago ( see last week’s column ) but it is still growing at a glacial pace. What is more, we have picked up only half the jobs lost during the Great Recession, leaving unemployment and underemployment painfully high.

Now the Fed says it will do more buying and more promising. It plans to buy a boatload of MBS and says short-term rates won’t rise before 2015 — all in the name of bringing down the unemployment rate.

Promising to keep short rates low this long is an unwise commitment.

For one thing, Ben Bernanke may not be Fed chair at that time if Mitt Romney wins the presidency. For another, inflation has already begun to pick up, bringing back memories of stagflation ( see my column of Aug. 14 ).

Both the producer price index and the consumer price index shot up in August, propelled by a jump in food and energy prices — two essentials. The excess liquidity that the Fed has already created will enable these increases to spread to the rest of the price indexes.

All this said, the level of interest rates today is not the problem; they are about as low as they can go. Neither is the availability of money, since the banks are already stuffed to the gills with cash that they are reluctant to lend.

Promising to keep rates low may actually be counterproductive, since this may be discouraging borrowing ( see my column of Aug. 7 ). Low rates also hurt savers, especially seniors, who rely on safe, interest-bearing investments for a big chunk of their income.

No, Virginia, the real problem today is something that monetary policy can’t control — especially when rates are as low as they are today. I am referring to uncertainty rooted in politics.

The upcoming elections are a good example.
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Kathleen Parker: Cyborg Mitt

Republican presidential candidate and former Massachusetts Gov. Mitt Romney speaks to reporters about the secretly taped video from one of his campaign fundraising events in Costa Mesa, Calif., Monday, Sept. 17, 2012. (AP Photo/Charles Dharapak)

1 hour ago • Kathleen Parker • kathleenparker@washpost.com

What’s a day without a leaked video, a scandal, an unintended sliver of truth?

OMG: Mitt Romney doesn’t care about the votes of the 47 percent of Americans who don’t pay federal income taxes and therefore don’t care much about his message of lower taxes.

Who. Knew?

Oh the umbrage, the unforced errors. How can we hand over the presidency to a man who cares so little about those who have no intention of voting for him?

Romney should know better. It’s not as though there was no precedent for this sort of thing. Four years ago, Barack Obama spoke candidly at a similar “private” fundraiser in San Francisco, saying that small-town Pennsylvania voters expressed their economic frustrations by clinging “to guns or religion or antipathy toward people who aren’t like them.”

A person running for president should keep his thinking cap more tightly affixed even when among his own kind, millionaires in Romney’s case. And he should make sure his facts are right. Although true that nearly 47 percent don’t pay income taxes, most do pay payroll taxes, as many have pointed out. Moreover, of the 18.1 percent of households that pay neither income nor payroll taxes, most are elderly or earn less than $20,000, according to the Tax Policy Center.

But it is also true that tax issues are of greater significance to those who see large chunks of income disappear from their checks each pay period. It’s easy to decide how much others should pay for your support when it’s not your money.

Still, Romney’s comments sounded callous and merciless, and will haunt him through the election. They also revealed something we hadn’t previously seen. Unguarded, Romney is no compassionate conservative. At his core, he is … a cyborg.
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Bloomberg News
Romney’s 47% Comments Show Gap From Bush-Era Republicans
By Richard Rubin on September 18, 2012

Eleven years ago, eliminating income taxes for low-income Americans was an applause line for a Republican president. Mitt Romney in 2012 sees the number of people paying nothing as a political problem.

The Republican presidential candidate’s comments that 47 percent of Americans don’t pay income taxes and see themselves as “victims” dependent on the government signifies a shift in the party’s thinking. Republicans backed refundable tax credits and expanded entitlement programs under George W. Bush. Now they want to curtail entitlements and require more people to pay taxes.

“The working people who don’t pay income tax, that is by and large the result of Republican policies,” said Michael Linden, director of tax and budget policy at the Center for American Progress, a Washington group aligned with Democrats. He said he didn’t “understand why they’re not trumpeting this.”

Romney’s comments, made at a private fundraising event in May and distributed by Mother Jones magazine Sept. 17, reignited a debate over how progressive the tax code should be and how those who don’t pay taxes view their connection to the government. Romney said in the video that he couldn’t attract votes from people who depend on government or persuade them to “take personal responsibility” for their lives.
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Economy
Face It: 2013 Is Gonna Be a Bummer
By Matthew Philips on September 13, 2012

Whether it’s Barack Obama or Mitt Romney taking the presidential oath of office in January, someone will have the misfortune of overseeing an economy that looks a lot like the one we have today: low growth, persistently high unemployment, and huge amounts of debt. Depending on what happens with the “fiscal cliff,” there’s at least a chance the U.S. will be in recession. The mere threat of $600 billion in tax hikes and spending cuts is already delaying business spending. Yet even if Congress does broker a deal and the worst of the fiscal cliff is postponed, 2013 is shaping up to be a rough year.

Big economic forces, both domestic and abroad, are combining to dampen growth. Fundamentals such as demographics and household finances that helped spur past recoveries are now slowing things down. These trends aren’t affected much by policy, so fixing them will be beyond the immediate grasp of an Obama or Romney administration. “No matter who wins the election, from a truly economic standpoint, 2013 will be an extremely challenging year,” says David Rosenberg, chief economist at Gluskin Sheff + Associates.
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Features
Student Loans: Debt for Life
By Peter Coy on September 18, 2012

(Corrects the 20th paragraph to provide a more recent total for student loans owed by people 60 and over: $43 billion rather than $36 billion. Corrects position of the National Association of Student Financial Aid Administrators on legislation introduced by Senator Al Franken.)

This much we know: College pays. You can lose your house to foreclosure, but never your education. Four-year college graduates’ pay advantage over high school grads has doubled over the past 30 years. If money for tuition is tight, the advice goes, borrow what you need. Students have been listening. In 2010 student debt exceeded credit-card debt for the first time. In 2011 it surpassed auto loans. In March, the Consumer Financial Protection Bureau announced that student debt had passed $1 trillion. It grew by $300 billion from the third quarter of 2008 even as other forms of debt shrank by $1.6 trillion, according to a separate tabulation by the Federal Reserve Bank of New York. In a press briefing at the White House in April, Education Secretary Arne Duncan said, “Obviously if you have no debt that’s maybe the best situation, but this is not bad debt to have. In fact, it’s very good debt to have.”

If student loans are good debt, how do you account for the reaction of Christina Mills, 30, of Minneapolis, when she found out her payment on college and law school loans would be $1,400 a month? “I just went into the car and started sobbing,” says Mills, who works for a nonprofit. “It was more than my paycheck at the time.” Medical student Thomas Smith, 25, of Hamilton, N.J., is $310,000 in debt and is struggling to make ends meet even before beginning to repay his loans. “I don’t even know what I eat,” he says. “I just go to the supermarket and buy the cheapest thing I can and buy as much of it as I can.” Then there’s Michael DiPietro, 25, of Brooklyn, who accumulated about $100,000 in debt while getting a bachelor’s degree in fashion, sculpture, and performance, and spent the next two years waiting tables. He has since landed a fundraising job in the arts but still has no idea how he will pay back all that money. “I’ve come to the conclusion that it’s an obsolete idea that a college education is like your golden ticket,” DiPietro says. “It’s an idea that an older generation holds on to.”
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Down here TPTB have been effective in keeping what were dropping prices in 09 from going any lower.

Posted: 7:00 a.m. Wednesday, Sept. 19, 2012

Florida home prices bottomed earlier than previously thought, according to one study

By Kimberly Miller

Palm Beach Post Staff Writer

WEST PALM BEACH —
A new home sales measure says Florida prices hit a soft bottom in 2009, years earlier than what some experts have declared as the low point for real estate.

The measure, similar to the respected national Standard & Poor’s/Case-Shiller price index, was created by Florida Realtors Chief Economist John Tuccillo to be a more accurate reflection of sale prices in the state.

Tuccillo said he was surprised that the index pointed to 2009 as a bottom, but said that was also a time when investors began eyeing Florida for real estate deals.

“Since then we’ve been sort of rocking along on a bumpy road,” said Tuccillo, who developed the index over about a year’s time. “It’s essentially been flat, but in this context flat is probably good news after the large run-up and drop.”

According to the index, Florida sales prices increased 152 percent from January 2000 to the peak of the market in November 2006. They fell 43 percent from the peak to mid-2009.

Realtors have long complained that the current method of reporting monthly median home sales prices doesn’t offer a true measure of increasing and decreasing values. The median, which means half of homes sold above the price and half below, can be greatly influenced if a large number of either distressed properties or luxury homes sell in one month.

A report on August’s sales of existing homes will be released today using the median price measure.

Florida’s new index is considered a “repeat sales index.” It combines Florida Department of Revenue data with prices of the same individual properties sold over time. The index is expected to be released quarterly but because of a lag in some statewide data, the first index runs only through August 2011.

Like Case-Shiller, the Florida home price index measures sales as compared with January 2000 when the index was set at 100. Case-Shiller’s Florida data include Tampa and South Florida, which combines Palm Beach, Broward and Miami-Dade counties.

National Association of Realtors spokesman Walter Moloney said he’s not aware of another state that has its own price index. California releases an “affordability index” that measures the percentage of all households that can afford to purchase a single-family home, but its sale prices are reported as a median.

While the public may prefer a median sales price that reports an actual dollar figure over an index, the index is considered more accurate.

Still, Palm Beach County Realtors said a statewide index doesn’t always reflect regional specifics.

Kevin Kent, a broker-associate with Platinum Properties, which has offices in Jupiter, Juno Beach and Stuart, said South Florida’s home sale prices probably hit a bottom later than 2009.

“When you step back and look at the entire state, that’s probably accurate,” Kent said. “But when you break it down into pockets and certain areas that were hit the hardest, the numbers wouldn’t be the same.”

In April, analysts at the online real estate database Zillow said South Florida sale prices hit bottom at the end of 2011. Case-Shiller’s index shows a bottom in Palm Beach, Broward and Miami-Dade counties in April 2011, but that prices had stabilized some before that.

Florida International University real estate professor Ken H. Johnson agrees that 2011 marked the bottom.

“Back in November, I thought it was pretty clear we had bottomed and housing was as affordable as it’s been in 40 years,” he said. “I said that was the turn, and we’ve not seen prices go down.”