Our Enhanced Capacity To Bid More
Readers suggested a topic on the economy. “The whole world may go into a deflationary spiral soon. Look at Japan now. Probably GD2. Does US president election even matter anymore? Whoever is in the office cannot do much about it and in fact speed up the process of downfall by printing more and spending carelessly.”
One added, “Why not add the pitfalls of trade protectionism to the scope of discussion? The Smoot-Hawley Tariff Act, which was intended to protect American jobs, was credited by many historians with worsening the severity of unemployment and production slowdown of the Great Depression.”
A reply, “The pitfalls of free trade are deeper than the pitfalls of trade protectionism. I don’t recall multinationals sending career jobs overseas by the hundreds of thousands during the 1920’s. S-H may have made GD-1 worse, but sending those careers oversees was a large cause of the Great Recession. (which would be a GD if it weren’t for food stamps etc).”
Another asks, “I was going to suggest a topic on the the flip side of the deflation coin, inflation. There is an enormous amount of money being created. My sense is that inflation is the path that the Fed will use to work out the crisis so the underwater and distressed loans will come closer to being paid off at their nominal balances. In real terms, not so much. This mess is going to play out over a long period of time.”
A reply, “The only way for the loans to be paid off at their nominal balances is for there to be inflation in wages/taxable incomes. The Fed can make more money. It can’t force the money into wages.”
To which was said, “But they can raise the minimum wage, and significantly. What I observed in my years in Mexico was that a minimum wage that tracked high inflation (Mexico never quite reached true hyperinflation) forced higher paid jobs to increase their wages as well as minimum wage would catch up with them. Mexico had other gimmicks to put money into consumer’s hands: Mandatory year end bonuses (aguinaldo) which was 20 days pay (90 days pay if you worked for the government!) and mandatory profit sharing (8% of profit is shared with employees). I’m not saying that that this would be good, but if the PTB wants wage inflation, it can be accomplished.”
And finally, “The scary thing about central banker policy today is that it’s not just one country engaging in money printing…it’s: Japan, UK, US; and all of Europe (”sterilized” for now). These four areas represent about $41 Trillion of the world’s $70 trillion of GDP. If you add China with their currency substantially pegged to the US dollar, it brings the total to $48 of $70 Trillion of the world’s economies engaging in money printing (68.5% of all the world’s economies).”
“There is a race to the bottom occurring right now for paper money. What will go up the most in value relative to paper money? Food? Energy? Materials? Precious Metals? Real Estate?”
From Reuters. “New home sales held near two-year highs in August and prices vaulted to their highest level in more than five years, adding to signs of a broadening housing market recovery. Home resales surged last month, homebuilder sentiment jumped to a six-year high in September and home prices in 20 major metropolitan areas rose in July for a sixth straight month, recent reports have shown.”
“Still, the housing market lacks sufficient strength to take the baton from the faltering manufacturing sector as the main driver of the U.S. economic recovery. The Federal Reserve targeted housing this month as a channel to spur faster economic growth. Fed Chairman Ben Bernanke said housing was the ‘missing piston’ in the recovery and the central bank announced it would buy $40 billion in mortgage-backed securities per month until the outlook for employment improved significantly.”
“Those measures have pushed mortgage rates to record lows, and led to a rebound in demand for loans to purchase homes last week, a second report showed. Fixed 30-year mortgage rates hit an all-time average low of 3.63 percent last week. While residential construction accounts for only about 2.5 percent of GDP, economists estimate that for every new house built, at least three new jobs are created.”
“In addition, economists said rising home values could support consumer spending. ‘The turn in home prices is important, not only because the housing industry is an important employer, but also the wealth effect created by rising home prices can lift consumer spending on other big-ticket items,’ said Steven Ricchiuto, chief economist at Mizuho Securities in New York.”
The Australian Financial Review. “I’ve covered the housing question many times in this newspaper, and my view remains the same: house prices are not nearly as overvalued as some suggest. Long-term measures of mortgage affordability, for example, have been broadly stable over recent decades. While there’s been a run-up in house prices relative to income, this largely reflects our enhanced capacity to bid more for properties due to the structural decline in interest rates over this period.”
“Properly measured, house prices relatively to average incomes are also not drastically out of line with international norms – especially once allowance is made for high land premiums due to our highly urbanised lifestyle. If you dig into the details on household debt, you’ll find most of it is held by those on high incomes with decent levels of housing equity. Like poverty, mortgage stress exists, but thankfully it is not widespread.”
“So far, so good. Indeed, earlier this week in this newspaper, I suggested nationwide house prices could rise by around 10 to 15 per cent over the next year or so if – as I suspect – the Reserve Bank of Australia is required to cut interest rates aggressively as the mining boom winds down.”
“I’d also concede that in today’s low inflation environment and with higher levels of household financial exposure, nominal property prices are likely now more sensitive to the economic cycle. Property prices are more likely to spike higher in good times yet also correct reasonably firmly in bad times.”
From China Daily. “In contrast with Shanghai, the market for luxury property in Hong Kong and Taipei is more active. Hong Kong is the most sophisticated luxury housing market among the three cities. In the second quarter, about 30 percent of Hong Kong’s luxury homes were bought by the wealthy from the mainland, said Doris Lam, director of investment services at Colliers International. Over the past five years, luxury property prices in Taipei surged between 60 and 70 percent, with low mortgage interest rates between 2 percent and 2.7 percent boosting the market, the report said.”
“About 58 percent of Chinese wealthy buy a luxury property for their own use, but 73 percent believe that a luxury property has better investment returns than a common residential property, a separate report showed. ‘Having a high-end residential property, a villa, a winter house in Sanya (Hainan province) and a summer home on Lushan Mountain (in Jiangxi province) has become a new lifestyle choice for China’s most wealthy people,’ said Chen Sheng, VP of the China Real Estate Data Academy.”
From NBC News. “With many U.S. consumers still lukewarm about buying into the American dream, Canadians, Chinese and Mexicans are burning up Realtors’ cell phones and emails, grabbing up swank vacation nooks, secure places to stash their cash, or just old-fashioned bargains. Foreign purchases of U.S. homes have climbed by 24 percent since 2011, reports the National Association of Realtors, reaching $82.5 billion in total annual sales, and helping brace once-creeky markets like Miami.”
“‘They love the U.S. because their money is safe here. Even if they only break even on a property, they know they can get their money out,’ said Matey Veissi, broker-owner with Veissi & Associates in Miami.”
“‘On the West Coast, you might have five or 10 families from China who pool their resources to purchase something, have a student live in it and then rent out the rooms. At the end of the student’s time, hopefully they sell the place for a capital gain. Those are the middle-class Chinese, buying for an investment,’ said Jed Smith, an NAR economist.”
From CBC News. “Ben Rabidoux, creator of the Economic Analyst blog, which looks into housing and mortgage trends, suggests the Canada Mortgage and Housing Corporation has ‘absolutely been the key driver in the boom in the ownership rate in Canada,’ and that this is having an inflationary impact on everyone. ‘Without that government support that’s allowing people with very little down to jump into the ownership pool, you just would not see the ownership rate expanding the way that it is,’ he argues.”
“He also believes the CMHC mandate is inherently self-defeating. ‘They don’t provide affordable housing, they provide affordable financing. And when all you do is provide affordable financing, you inflate house prices.’”
“While not against home ownership per se, Rabidoux believes that at some point housing starts will fall substantially, and that more homes are being built than demographics would warrant. The problem is the Canadian economy is more reliant on the current housing boom to generate GDP and labour market growth than ever before, Rabidoux says. ‘So in my mind what’s going to end up happening is when this whole thing turns to normalcy there’s going to be a period of readjustment in the economy where there’s going to be unfortunately high unemployment and persistently high unemployment.’”
“‘What happens when you have a high home ownership rate is it reduces worker mobility and that’s a fairly well known phenomenon. So there’s that danger as well,’ he said.”
September 29, 2012
Is QE 3 Really Just Another Bailout?
Michael Iachetta
At a time when mortgage rates are at historic lows, home prices have fallen, and previous overbuilding leaves little room for growth in employment in the housing industry, why would the Federal Reserve suddenly decide to purchase $40 billion worth of mortgage securities a month supposedly in order to stimulate the housing market and thereby create more jobs? So wonders Dr. Jeffrey Herbener, Professor of Economics at Grove City College.
His answer is that the public narrative that this move is for the sake of helping unemployment is a fiction, and that the move is really “another bailout of the holders of mortgage-backed securities.” These are primarily Fannie Mae and Freddie Mac, which according to Professor Herbener presently hold $2 trillion and $1 trillion worth of these securities respectively.
The Washington Examiner is likewise skeptical of the public narrative, but sees the move as being for the sake of the banks that sell mortgages to Fannie and Freddie.
Another possibility is that this is a step toward eventually shutting down these troubled and trouble-making GSE’s. On August 17 of this year, the U.S. Treasury changed the terms of its bailout of Fannie and Freddie. As reported by NBCNEWS,
With Fannie Mae’s investment portfolio valued at $673 as of the second quarter, and Freddie Mac’s valued at $581 billion as of June, the two GSE’s must sell a total of $754 billion worth of mortgage securities in order to reach the goal of each holding $250 billion. By purchasing $40 billion of mortgage securities a month from the GSEs, the Federal Reserve could help the GSEs reach this goal in 19 months. The NBCNEWS goes on to report that “the Treasury said the changes would accelerate plans to eventually shut the companies down.” If that is the true goal of QE3, it would take the Federal Reserve less than three years to accomplish it.
…
So the Fed is a giant rug that we sweep all the financial dirt under. What a brilliant idea. Just never look under the rug.
It’s the toxic loan Structured Investment Vehicle in the guise of a central bank with a virtual electronic printing press.
If they’re just going to move the MBS to the Fed, why not just keep them with the GSE’s? Political reasons most likely.
However it undermines the the whole, “Reduce the role of the government in the mortgage market.” What is the Fed but another government sponsored entity? Except with the power to print currency and a magic balance sheet as a result.
“Political reasons most likely.”
Exactimento, amigo. Unannounced political intentions:
1) Vacuum a plethora of MBS onto the Fed’s balance sheet.
2) Shut down the GSEs.
I agree. To keep them at the GSEs, they would need to expand the balance sheets of the GSEs considerably–and that would be political fodder…
So when GSE’s get their balance sheets down to $250K each can POTUS have one of those ribbon cutting photo ops in front of the press so he can declare the government mortgage debt issue is now “contained?” Only all that will have been accomplished as you point out is to move the debt from the GSE’s to the Fed in other words from the left hand to the right hand. The government will still own just as much debt as before. So in essence nothing will be done.
In a rising rate environment these securities will plunge in value. Whoever is holding them when rates start to normalize will take it in the shorts. So the banks aren’t going to buy this crap from the GSEs anymore. Possibly they just want to let them explode away from the scrutiny of the press (on the Fed’s balance sheet). Let the Fed take the loss from the bank’s balance sheet. The total loss is the same - it just occurs in the government sector.
That being said I wouldn’t be too surprised if they try to keep rates near zero for another decade a la Japan. Will they succeed?
“In a rising rate environment these securities will plunge in value. Whoever is holding them when rates start to normalize will take it in the shorts.”
As in all other bubbles, the investing strategy in this one is to ride it up through the parabolic price blowout, then sell at the top just before it collapses on the greater fools who bought and sold too late.
Yes…that’s the plan when you care about money. But what about when you don’t care about money because you can print whatever you need? Perhaps there is power in being able to ingest trash that would be fatal to any other organization?
Perhaps there is power in being able to ingest trash that would be fatal to any other organization?
Yes, there is power in that. But it is the power of corruption.
The Fed has an unbounded ability to bury the losses, keeping them off the books for its friends.
And who would those be?
Buy low, sell high. Not necessarily buy lowest, sell highest.
And then there is this:
http://ftalphaville.ft.com/blog/2011/01/20/464471/the-fed-cant-go-bankrupt-anymore/
The “shorts” in this case are worn by all of us.
The Fed _never_ could go bankrupt.
They have an unbounded ability to print themselves up whatever amount of gains they need to remain solvent.
Given that, how could they possibly go BK?
“Given that, how could they possibly go BK?”
Runaway inflation prevents them from ever being able to print enough to stay solvent?
This is my understanding:
The Fed does have a balance sheet…there is paid in equity to that balance sheet. My understanding is that the shareholders are the major banks in the US. If there is a deficiency at the Fed, there is a capital call, and banks like JPM would need to write a check to recapitalize the Fed.
When the Fed “prints money”, they are essentially expanding their balance sheet (buying more and more US Treasuries, etc.).
However, at this point the Fed is leveraged about 100 to 1, with an increasing amount of that 100 being in long-duration bonds.
When interest rates rise, the value of their long-maturity bonds falls. If the value falls by a mere 1%, the Fed is technically insolvent…this is solved via the accounting trick noted in the link.
Runaway inflation prevents them from ever being able to print enough to stay solvent?
Inconceivable.
Experts lukewarm on Fed’s housing program
By Annie Lowrey / New York Times News Service
Published: September 15, 2012 4:00AM PST
WASHINGTON — The Federal Reserve’s ambitious new effort to aid the recovery by aiding the housing market is likely to have a modest effect on sales, given the pervasive weakness in the economy and real estate market, experts predicted Friday.
“The incremental benefit of slightly lower mortgage rates will be small,” Paul Diggle, a property economist at Capital Economics, wrote in a note to clients.
“After all, most borrowers in a position to refinance have probably already done so. And it’s not obvious why a would-be buyer who wasn’t tempted by a 3.7 percent mortgage rate would be by, let’s say, a 3.25 percent rate,” he wrote.
Other analysts echoed that, saying the Fed program would help the housing recovery at the margins, but that even lower mortgage rates would not be enough in and of themselves to spur a strong turnaround.
On Thursday, the Federal Reserve announced a third, major round of asset purchases.
They were intended to speed up the stalling recovery, bring down interest rates and increase employment.
“While the economy appears to be at a path of moderate recovery, it isn’t growing fast enough to make significant progress reducing the unemployment rate,” Ben Bernanke, the Fed chairman, said at a news conference Thursday. “The weak job market should concern every American.”
The Fed is now aiming at the unemployment problem by purchasing mortgage-backed securities at a pace of about $40 billion a month for an indefinite period of time.
The effort will increase prices and demand for those mortgage-backed securities and push down mortgage rates, already near their historical lows. That might encourage more families to refinance their mortgages and others to purchase a home, with ripple effects through the real-estate industry and the rest of the economy.
Analysts said it might help strengthen and quicken an already existing, but tentative, housing recovery. In recent months, housing prices have bottomed out in many markets. Home sales have ticked up. Builders have broken ground on more new projects. Six years since the real-estate bubble started to deflate, many housing analysts admit, if cautiously, that they believe that the worst is over.
On Thursday and Friday, financial markets cheered the Fed’s announcement. Stocks climbed, as did the price of many of the mortgage-backed securities the Fed vowed to buy.
But housing analysts cautioned that the new Fed effort would be no panacea. Millions of homeowners owe more on their mortgages than their homes are worth, leaving them in no position to sell. Millions more are unemployed or underemployed, and unable to afford a home. The foreclosure crisis is continuing and credit is tight, leaving many people who would like to buy a house unable to get a mortgage.
Jed Kolko, the chief economist at Trulia, a real-estate analytics firm, anticipated a muted effect on sales.
“The big obstacles for people who want to buy are saving enough for a down payment and qualifying for mortgage, because credit is still tight,” Kolko said, saying that the Fed program would not directly address those problems.
Still, Kolko and other analysts said that any effort by the Fed to make borrowing cheaper and to aid the economy would help the housing recovery.
“This makes housing a little bit more affordable,” said Gus Faucher, senior macroeconomist at PNC Financial Services Group. “But more important, it is designed to give some confidence to households and financial markets that the recovery is going to continue.”
…
By refinancing at debt based on a near zero funds rate they are laying the groundwork to make it impossible to ever normalize rates again without setting off a neutron bomb national default in every sector. In the end the fed will either have to adsorb all the debt from every sector or all debt will have to be converted to floating rate securities.
“In the end the fed will either have to adsorb all the debt from every sector or all debt will have to be converted to floating rate securities.”
I posed a question here at least a couple of times last week: What is to stop the Fed from absorbing all the debt it chooses to absorb onto its balance sheet, forever?
I’m still waiting for an answer.
Yup. And what would the side effects of that be?
The Fed is omnipotent. There is nothing it cannot buy. The Fed is the economy, now. Why limit things to $40B per month? That’s chicken feed. C’mon Bernanke, get a spine. Let’s see 5 trillion per year!
As I have oft pointed out here, macroeconomists are blithely oblivious to the budget constraint, especially the ones who have access to a virtual electronic fiat money press.
“But they can raise the minimum wage, and significantly.”
The first order effects of a higher minimum wage are (1) increased employment opportunities for illegals willing to work for less than the minimum wage; (2) increased unemployment for legal workers in job categories subject to the minimum wage.
Sounds like a dumb idea.
Yep, doesn’t work here like in Mexico because the US has no escape valve, a service we have provided to them for many decades.
Cash under the table is the result.
Sweden has tried this. I Swedish government official asked a pendant why they thought that Sweden didn’t have a home painting business like other countries. Yet homes seem to get painted.
Barter works quite well. So does home production for work where your own opportunity cost of time and effort is lower than the (artificially inflated) minimum wage.
This only works in areas where the low-skill jobs aren’t already taken by illegals. In my neck of the woods, the only unskilled jobs NOT done by legals are the ones which require direct interaction with the customer (cash register), or ones that are union protected (taxpayer landscapers).
But there are plenty of areas where the wave hasn’t hit, like Bakken.
Why are these corporations allowed to get away with this? I truly do not understand why this is allowed to happen. It’s sickening.
“Still, the housing market lacks sufficient strength to take the baton from the faltering manufacturing sector as the main driver of the U.S. economic recovery. The Federal Reserve targeted housing this month as a channel to spur faster economic growth. Fed Chairman Ben Bernanke said housing was the ‘missing piston’ in the recovery and the central bank announced it would buy $40 billion in mortgage-backed securities per month until the outlook for employment improved significantly.”
Sounds like the central planners at the Politburo have a major clusterfork on their hands.
“With many U.S. consumers still lukewarm about buying into the American dream, Canadians, Chinese and Mexicans are burning up Realtors’ cell phones and emails, grabbing up swank vacation nooks, secure places to stash their cash, or just old-fashioned bargains. Foreign purchases of U.S. homes have climbed by 24 percent since 2011, reports the National Association of Realtors, reaching $82.5 billion in total annual sales, and helping brace once-creeky markets like Miami.
They love the U.S. because their money is safe here.”
Their money is safe as houses.
BwahahaAHaHAHAHHAHAHAHAAHHAHAHAHAAAAAAAAAAAA!!!!!!!!
Test Date:1985-1992
Laboratory: US
Test Subject: Japan
Outcome: Massive, crushing and still ongoing losses sustained by test subject
Now the same elements that are in place are larger by orders of magnitude.
I remember in the early 90s Japanese lawmaker Kabun Muto, said: “American workers are too preoccupied on Fridays with the coming weekend and cannot throw themselves wholly into their work Mondays as they played too hard Saturday and Sundays.”
Prime Minister Kiichi Miyazawa, said: “I have long thought that they (Americans) lack a work ethic to live by the sweat of their brow.”
This arrogance is trademark of their racist culture. They believe in karma more than I do. Well it got to them and they are still stuck.
I think at some point Japan will get out of the funk. It’s all about cycles. Japan’s golden age is overdue. But if they did not learn from the karma of their racism and arrogance, they will postpone their golden age.
I remember rich japanese trying to buy up real estate in California. At that time it was deflating its RE bubble from the 80s. They should have waited until 1997.
I wonder where these nice folks came up with the “$82.5 billion.” I’m sure it’s not money be laundered. Nah…
People around the globe have been conditioned to believe that housing is supposed to be unaffordable.
That said, I think the comment “their money is safe here” is based on the belief that the US government won’t confiscate it like other countries might and that the USD is a safe haven.
The problem is the Canadian economy is more reliant on the current housing boom to generate GDP and labour market growth than ever before, Rabidoux says. ‘So in my mind what’s going to end up happening is when this whole thing turns to normalcy there’s going to be a period of readjustment in the economy where there’s going to be unfortunately high unemployment and persistently high unemployment.’”
“‘What happens when you have a high home ownership rate is it reduces worker mobility and that’s a fairly well known phenomenon. So there’s that danger as well,’ he said.”
OMG, Rabidoux sounds exactly like _us_—back in 2006.
What’s going on in Canada is mind boggling. I know a large number of folks up there that a few years ago were average Joe’s. Now they are all Thirstin Howl, III types. It’s amazing how much wealth has been accumulated in Canada based on the housing market.
I remember our bubble and all the Thurston Howell types, too. But how much wealth was actually accumulated and how much was just showing off with HELOC money?
It’s hard to read these bits without feeling a profound sense of revulsion towards the developed world’s political and economic leadership.
Ben, it looks like you have a Canadian peer.
“There is an enormous amount of money being created. My sense is that inflation is the path that the Fed will use to work out the crisis so the underwater and distressed loans will come closer to being paid off at their nominal balances. In real terms, not so much. This mess is going to play out over a long period of time.”
The challenge for the Fed is to create enough inflation to bail out all the underwater and distressed loans while claiming to keep inflation under control and keeping a straight face in the process.
They have been doing that since 1913.
In 99 years, the original dollar is now worth .04. That’s right, 4 cents.
So, apparently, you can inflate your way to poverty without the masses going apeshit, so long as you do it in an energy-rich, highly productive, creative, inventive society.
Mass production and machine tools have done a lot to hide the fact that the FED’s only goal is to destroy value to create continuous debt and servitude.
Free People would destroy the FED before it destroyed them.
The reason the Fed has been able to get away with this is because of technological advancement.
Technological advancement plus a suitable incentive structure has allowed for abundance of food, clothing, shelter and medical care.
HOWEVER…. if the dollar was losing value in the absence of technological advancement, the system would have been Marie Antoinette’d.
Now… people look to the experience of the past and believe because it worked in the past means it will work in the future, without understanding WHY it worked.
Example: “The debt doesn’t matter. It will become smaller as a percent of GDP as a result of growth just like it did after WWII”
Example: “We can keep inflating the dollar but it doesn’t matter. Technological advancement will keep improving the lives of the masses. Plus this system helps our fellow financiers to become ever wealthier, win-win.”
If either turn out to be incorrect, the piper will be paid.
“The reason the Fed has been able to get away with this is because of technological advancement.”
Is it fair to suggest they also owe their ability to create hundreds of billions of dollars out of thin air to the virtual electronic printing press, an artifact of the computer era?
Or could they have done this in the pre-computer era, with real paper?
My thought is, the physical evidence would be far more stark w/o computers; e.g., grandmas and grandpas carting around wheelbarrows full of fiatscos to pay for groceries, and such…
I don’t believe that computers are needed to create money using the fractional reserve system.
Ha! The people are not free, they are in debt.
Debt slaves by their own free choice.
“Free People would destroy the FED before it destroyed them.”
We could use a president like Andrew Jackson again.
Maybe if he gets sufficiently desperate, etch-a-sketch Romney will harken back to Jackson and take the Fed head-on.
But I’m not holding out hope…he seems pretty damn clueless on matters economic. Typical trust fund baby…
All we need to do to destroy the banks is stop borrowing.
‘In her new book, Bull by the Horns, former FDIC Chair Sheila Bair gives a detailed account of the 2008 financial crisis and its aftermath. As you’ve probably heard by now, Bair is unfettered in her criticism of Tim Geithner, calling him the “bail-outer in chief” and suggesting the Treasury Secretary was more worried about protecting Citigroup vs. protecting taxpayers.’
‘But the book is more that just a Geithner-slam, even if that’s been the bulk of coverage so far. Bair offering a series of recommendations for how to reform and strengthen the financial system, including abolishing Fannie Mae and Freddie Mac.’
“The hybrid nature of Fannie and Freddie led to disastrous consequences,” Bair writes. “Ultimately, both institutions need to be liquidated.”
‘Abolishing the GSEs is just one of Bair’s recommendations to reform the financial system. As discussed in the accompanying video and part 2 of this interview, others include:
Breaking up the Mega-banks.
Raise capital requirements for banks.
Abolish the OCC and merge the SEC and CFTC.
End the ‘revolving door’ between Wall Street and Washington.
Change the tax code to put equity financing on par with debt financing, and earned income on par with investment income.’
http://finance.yahoo.com/blogs/daily-ticker/liquidate-fannie-freddie-sheila-bair-rx-financial-system-120907523.html
Tim Geithner, calling him the “bail-outer in chief” and suggesting the Treasury Secretary was more worried about protecting Citigroup vs. protecting taxpayers.’
A vote for Obama is a vote for another four years of the Geithner-Bernanke-led Plunge Protection Team.
It’s funny, I started reading “the Price of Politics” (Woodward), and he was talking about how Geithner didn’t want the job as Treasury Secretary (told Obama that he wouldn’t back away from the decisions he made during the crisis, and that Obama would have to live with that politically).
He also noted that Geithner was near absolute in his view that the deficit needed to be reduced to 3% of GDP.
My impression of the book after 5 chapters?
We’re all F’d. There are few in Washington left who are willing to put country before their next election.
What would happen if a person bought a home path home in Florida, then just immediately stopped paying, but kept taxes current?
5-7 years of PI+I/rent-free loving, then… maybe a deficiency judgment in 10 years, which could be discharged in BK?
And you get to say - “I am a victim!”
We are in a trade situation that is not the same as the ones before in American history ,so why is that line used to justify our current trade policies or the outsourcing and outmanufacturing to other Countries ?
Trade can be a good thing ,but not if it becomes a way to crush labor here in America and bring competition with Countries that don’t have the same cost of living or standard of living ,better known as slave labor World wide .
Wouldn’t it be the job of Politicians to protect the Citizens from policies/laws/ agreements that would unbalance the power between labor and the Job GIvers ? Wages use to track with cost of living somwhat for decades here in America ,but now it’s a game of fleece
the sheeple and the gains go to the price fixing Monopolies and top
10% and Globe exploiting Multi-national Corps.
People think that leveling out the playing field is a Commie plot ,but to be more accurate, it simply keeps the economy functioning in a more well balanced way that actually ends up being more productive .
“With many U.S. consumers still lukewarm about buying into the American dream, Canadians, Chinese and Mexicans are burning up Realtors’ cell phones and emails, grabbing up swank vacation nooks, secure places to stash their cash, or just old-fashioned bargains.
——————-
Thats all fine and well, but is there enough law enforcement to protect all that property they are “snapping up?”