The Housing Bubble

…and pro sports on MSM.

Do you suggest they tell the leaves not to lose their leaves in the fall? The leaves fall. They end up on the streets. They pile along the edge of the streets. They cover up the storm drains. Usually it isn’t a big deal because usually we don’t expect to get 3 to 8 inches of rain over one or two days.

“They cover up the storm drains.”

Relax, the free market is on its way.

“Do you suggest you tell the leaves not to lose their leaves in the fall?”

Is this the limit of your thinking? How about clearing the streets of leaves, or screening the storm drain entrances?

At this time of year in the NE the streets would have to be swept once per week to keep the drains clear. Ask 2banana if he wants to pay for that.

Once a week, eh. No big deal. Where I live we always get out streets swept once a week, leaves or no leaves.

Where I live, we have gas-powered leaf blowers contributing noise and fossil fuel emissions pollution every week, leaves or no leaves.

I never fully caught on to the concept of blowing leaves around before picking them up. Wouldn’t it be more efficient to just rake them into a large container and be done with it, rather than first blowing them around, then transferring large piles into a container.

” screening the storm drain entrances”

Then the leaves would block off the screens and block anything from getting to the drain. Same difference.

Where I live we always get out streets swept once a week, leaves or no leaves.

LOL. Let me guess- you’ve never lived in an area with mostly deciduous trees. It’s a far, far different thing to sweep a street, than it is to clear a well-treed (deciduous) street of leaves in the fall.

“same difference”

Wrong. The leaves blocking the entrance can be easily removed, but once the leaves are plugged up in the storm drain they can’t be easily removed.

The leaves blocking the entrance can be easily removed, but once the leaves are plugged up in the storm drain they can’t be easily removed.

Spoken like someone who doesn’t live where the trees drop leaves…

It is always the grating on the storm sewer that catches the leaves and plugs up; the sewer itself is never what gets plugged up.

Around here, they ask people to “adopt a drain” near where they live, and keep it clear of leaves—at the grating, of course.

“Are you threatening me? I need TP for my bunghole!”

There is no need to start a run on TP when a storm hits DC. The locals do it all by themselves. It happens even if storms are close together, so even if there has been a huge surge in TP purchase a week or two ago, there will be another one. Maybe people think hurricanes and blizzards cause the runs? Maybe they eat it during the storms? I can’t figure it out myself.

TP?

Seriously?!?

You can’t just rub your bum clean in the shower?

Wow, just wow. You people would never survive in rural Cambodia.

True confession: Took a tour of a jungle in Kauai a couple of days ago, and the guide showed us the kind of leaf that used to serve as TP. It’s softer than Charmin, and free!

Make sure they aren’t leaves of three.

“… leaves of three.”

No poison ivy or oak grows on Kauai!

I’ve got a pretty good bed of betony aka ‘lamb’s ears’ growing in the backyard. It’s leaves are as soft as, well, lamb’s ears. It should suffice in a “pinch”. It’s also called ’self-heal, ‘wound-heal’, and ‘heal-all’, so it might be good on your roids.

Besides the risk if flooding, also remember a lot of the “subway” system in the outer boroughs is elevated… wouldn’t want to be on the N train in high winds.

While closing the subways does present some inconvenience, it’s probably small compared to what would happen if equipment was damaged.

And having an excuse to stay home and make jam for xmas presents is the silver lining.

“Betting on probabilities is for repeatable events.”

This is where Bayes pays.

Or the 7 which i take to 40th st

wouldn’t want to be on the N train in high winds.

“Betting on probabilities is for repeatable events.”

This is where Bayes pays.

Bayes is only one of many modes of decision making.

I’m a Bayesian frequentist as in all things being equal, I’d rather have a ton of data but I’m not going to wait around for it to be generated.

“…Bayesian frequentist…”

Same here. Very much an agnostic on the religious war between rival schools of statistical inference…

Anyone who is called upon to make difficult decisions in the face of uncertainty on a routine basis has no choice but to adopt the entirely rational “Bayesian frequentist” position.

The religious war is for jack@sses who have the luxury of not being under fire DAILY where their decisions actually matter in a substantial way.

In short, academics.

The worst ones even.

Except when it mattered in 2008, and the sainted quants were wrong.

Wish y’all could have seen the look on the face of the “internationally-recognized authority” on Bayesian/causal inference when I mentioned that little gem one night. An academic, btw.

‘Wish y’all could have seen the look on the face of the “internationally-recognized authority” on Bayesian/causal inference when I mentioned that little gem one night. An academic, btw.’

Some day when we have a face-to-face meetup, remind me to tell you about the noted academic who tried to persuade into buying a home in San Diego in the mid-2000s. His mom’s a Realtor™, so he was pretty sure real estate was going to keep going up forever.

The real issue is the proposed cap to the total amount of deductions. I don’t know how he would get such a thing through Congress, but it could have a big impact if certain items are included. For example, if the amount you put aside in your 401k is included, then people who are responsible enough to try to save for retirement using the tax advantaged plans would lose big time. The middle class living in a state that is responsibly taking in enough tax revenue to pay its bills could be disadvantaged because just their income and property taxes get them through a large chunk of the limit.

For example, if the amount you put aside in your 401k is included, then people who are responsible enough to try to save for retirement using the tax advantaged plans would lose big time.

How could that possibly be included in a deduction cap?

Those contributions aren’t deductions on your taxes today—the income is just deferred.

It would essentially eliminate the concept of a tax deferred retirement account for people who have too many other deductions, but that isn’t unprecedented. I had money put in an old 401k that was “post tax” and the information that the tax had already been paid on it was retained by the manager. When I rolled it over to an IRA, I took out the post tax money because the idea of keeping track of having already paid tax on some completely weird amount of money in the account and retaining some records of the proof and then having to deal with proportional allocation of later withdrawals between pre and post tax money was too obnoxious to consider. I think it was in the vicinity of $6000. The concept is already there in the law.

I can’t believe it would have a serious chance of passing, polly—too many fees on that money that want to be earned by Wall Street.

Their donations guarantee my deferral.

“And your point gets to the reason that the real beneficiaries of the MID are those with jumbo mortgages, not Joe6pack in Columbus, Ohio, with his paltry $100,000 FHA special.”

In other words heartland people don’t care about the MID because it won’t apply to them (like me), but the sand staters and other bubblelicious states will care because it applies to them. So Rmoney wants to give up on those states. Otherwise why not lie to gain their support?

Now smoosh that up against some electoral vote maps like the 270towin map showing battleground states.

Does Rmoney want to throw the election or something? Give the bubble states NV, NC, FL, VA, CO and NH to Obama, whoops that plus the solid O states equals 277 electoral votes, win for O, even if every single “low housing cost” state goes Rmoney because of this campaign promise.

Strategically, its a pretty weird decision if you assume the guy is trying to win, instead of trying to lose.

(I’m voting Johnson, not going to throw my vote away on either crook)

You are assuming that the people involved know how little that itemizing their deductions helps them. I assure you, that their tax preparers and/or tax prep software don’t tell them that they only saved an additional $100 by itemizing.

“You are assuming that the people involved know how little that itemizing their deductions helps them.”

To the contrary, I am completely certain that the average greater fool homeowner has absolutely no clue on this topic. How else do you explain the ability of the NAR to bamboozle the masses into believing it is in their collective interest to protect the MID, or Realtors™ convincing Midwestern folk to buy homes in order to claim the MID?

Why buy a babe magnet when you can just rent the babe?

So you’re saying skip the car and go directly to the real babe magnet?

“…the real babe magnet?”

Reminds me of a funny joke someone I know recently emailed around.

An old guy at the gym is ogling a hot young bra-less wonder. He asks the trainer, ‘Which machine should I use to impress that young lady’?

The trainer responds, ‘I suggest trying the ATM in the lobby.’

You know what’s better than being the old guy with the fat bank account?

Being the young guy with the fat bank account.

BWAHAHAHHAHAHAHAHAHAHHAAHHHHHHHHHHHHHHHH!!!

I sold off ten percent of my equities this year, including a stock mutual fund that had a good run. Yes I too still have enough in the game. I suggest, however not contributing any more than to get full company match on your 401k. The rest of it I suggest to build up cash until the correction.

“imminent for along time.” Look at the graph of the S&P 500 since 1990. A big runup to 2000. A big runup from 2003 to 2008. A big runup since 2009. If you were like me and fully into stock mutual funds in your 401k since 2009 you would be in fat city, so you can afford to sell off some of your equities and hold in cash for opportunities ahead. My average gain since January 2009 is well over 12% in my 401k and much higher outside my tax deferred plans.

If you were like me and fully into stock mutual funds in your 401k since 2009 you would be in fat city, so you can afford to sell off some of your equities and hold in cash for opportunities ahead.

Well…there’s the problem. I’ve been mostly out since 2008 because I honestly never imagined that they would suspend mark to market and crank up the printing presses like this. I’ve been waiting for a test of the 09 bottom this whole time.

“I honestly never imagined that they would suspend mark to market and crank up the printing presses like this.”

Given they DID crank up the printing presses, why would you expect the 09 bottom to ever be tested?

Given they DID crank up the printing presses, why would you expect the 09 bottom to ever be tested?

Personally, I don’t think the excess liquidity can be restrained within the financial markets forever; up to this point, it has largely stayed where they have wanted it, pushing up the financial markets (with the intent of stimulating via the wealth effect), but it’s like blowing air into a balloon. Balloons don’t stay inflated forever. Eventually it should equalize throughout the global economy, with predictable results.

“Balloons don’t stay inflated forever.”

When the balloon starts to deflate is exactly when the Fed has more-or-less promised to pump in more air. And notice they made QE3 infinite-lived (i.e. they will keep doing it until the labor market returns to health, which may never happen…).

Given they DID crank up the printing presses, why would you expect the 09 bottom to ever be tested?

I don’t know…I’m still in shock. Haven’t formulated a new plan yet. All I know is that I’m not going to do what they want me to do, which is put it all on the table.

All I know is that I’m not going to do what they want me to do, which is put it all on the table.

Ding ding ding!!!!

Same here.

When the balloon starts to deflate is exactly when the Fed has more-or-less promised to pump in more air.

The question in my mind becomes one of how they can justify the additional pumping once the inflation-producing effects have become plainly visible to all…

This is my third time back in L.A. since 2003. I learned from my first time here what the L.A. beach area gals are usually about. Far different from the Mesa, AZ gals! Very nice looking woman at work is a real material girl and is well-known to zero in on big spending guys. She can read me like a book and won’t give me the time of day. She’s shacking up with a lawyer a way up the coast now.

She can read me like a book and won’t give me the time of day.

Wow. Good looking and smart.

Yup. She must be a socialist just like you Alpha slob. That is, draining OPM.

maybe with my old acquaintance Will from Monteceito. He has a BMW and was never true to his wife or kids.
Real babe magnet; chicks dig him only his kids missed out of a real dad.

BTW What does your future financial legacy mean to you, Bill, if your DNA is not passed on? Or does it feel good to be buried amongst your gold? I say my kids will be alive and remembering me longer than your gold remembers you. Just my opinion, life is fleeting, how do you pass meaningful legacies along with dough? Supporting your siblings? Is that as fulfilling as supporting a family. Just think the world could be filled with Little Bills!

Those are the kind of women I run away from.

Those are the kind of women that I make sure to scare away.

I think of it as protective camouflage.

And if Obama wins, ObamaCare will not be abolished. He has to get both the Senate and House to counter ObamaCare first. And even if they could counter it, the RomneyCare substitute will be socialist-lite.

Conservatism is a combination of a slower pace down the road to serfdom than progressivism, combined with theocracy.

oops I meant “And if Romney wins,…”

One of my sisters and her adult kids are extreme Romney/Ryan fans and think Obamacare will be repealed if only Romney wins. They should read the constitution and review the functions of the President, as well as find out Congress has to get involved.

and think Obamacare will be repealed if only Romney wins

I’ve encountered this as well. They believe that he can repeal it via executive order. When I explain to them that legislation will be required and that the Dems will be able to filibuster any such legislation, they get pizzed.

“If he wins all the Rs will become Keynesians anyway.”

Yep. Getting elected has precipitated many an overnight religious conversion.

From my understanding, very few female conservatives are attracted to “R” because of the economics. If the Democrats had the Austrian economics there would be probably less than ten percent of them female. The attraction is the social conservatism. My sister has always been for “sharing” and called me “money grubbing” when I would not loan her anything years back. She is very “progressive” and “permissive” in her idea of child development (which she majored in) but she is a dedicated Republican.

So, build it and they will come?

“Consumers will spend if they have the money but they do not have it now.”

Consumers SIX YEARS AGO would spend if they had the money (boy, did they ever!) but consumers today are a bit hesitant.

Something to do with, uh, … fear.

Americans will spend every dollar and every that they can borrow.

I see no change anywhere. The “fear” has yet to take root.

Tell that to those who used to depend on eight percent returns on their invested capital and are now getting zilch.

Be sure to remind them that this zilch return is going to be around for a long while.

Also remind them that this zilch return does not stop at their own invested capital but that their company pensions are also enjoying the same zilch return.

Not to worry; They can always cash out the equity in their homes.

Oh, and if there are any student loans involved (and there probably is since there are about a trillion-or-so dollars worth outstanding - and growing) be sure to remind these borrowers that these student loans have to be paid back - with interest.

And if their investment in this borrowed-money education fails to land them a good paying job? Tell them that doesn’t matter: The borrowed money has to be paid back - with interest.

And don’t forget to remind the co-signers of the loan, if there are any.

2 trillion dollars on the sidelines is a lot of money to jump start the economy and that is what is on the sideline by businesses of all sizes.

You assume that money will be invested in this country, as opposed to being invested in countries where wages are tiny and pollution is tolerated as an economic necessity.

Luckily all this can be taken care of as soon as the real estate market comes back to where it should rightfully be price wise so all these annoying financial trivials can be dismissed.

‘The “fear” has yet to take root.’

Ignorant faith in unlimited plunge protection is bliss.

Investing
10/16/2012 @ 9:31AM
Consumers And Investors Blissfully Ignorant Of Economic Reality
Sy Harding Sy Harding, Contributor

It’s been a most unusual – some say crazy – year for global stock markets, certainly including that of the U.S.

The global economic recovery from the 2007-2009 financial collapse stalled last year and continues to worsen this year, with the International Monetary Fund cutting its forecasts for global economic recovery yet again, including for the U.S., and warning last week that risks of the world dropping back into a global recession “are alarmingly high”, and that “no significant improvements appear in the offing.”

That certainly sounds like the IMF doesn’t have much confidence that the ‘Troika’ (the IMF, EU, and ECB) will be successful with the euro-zone rescue plans and stimulus measures announced a month ago.

Meanwhile the stock markets of China and Japan, the world’s second and third largest economies, are in serious bear markets due to their economic slowdowns and fears of the worsening global economic conditions. China’s stock market is down 40% from its peak in 2009. Japan’s market is down 22% from its 2010 peak and still 51% beneath its peak in 2007.

Clearly neither of those extremely important global economies have any more confidence than the IMF that improvements are in the offing.

U.S. corporations seem to be preparing for the possibility of unusually difficult times ahead. They have salted away a record $1.4 trillion in cash, refusing to invest it in their futures, earning near zero on it, the purpose for hoarding the cash rather than using it apparently being to make sure they can pay their bills and survive anything that might lie ahead.

The fear of corporate managements could also be seen in the way that corporate insiders did not agree with the optimism that created the big stock market rally off the June low. They sold into its strength at an unusually heavy pace. According to the latest Vickers Weekly Insider Report, their selling has continued even after the Fed announced its QE3 stimulus measures. Like the IMF, and China and Japan’s markets, they apparently have little confidence that the new rescue efforts by the ECB in Europe and the U.S. Fed, will produce economic improvement anytime soon.

Usually savvy hedge-fund managers likewise did not participate in the June rally, instead selling into it. According to the Wall Street Journal, that has them experiencing their worst year since 1997. The opinion of hedge fund Comstock Partners, revealed in a report this week, is that the economy and stock market face “severe headwinds in the period ahead.” It cites “the ongoing European sovereign debt crisis, significant slowing of growth in China and emerging markets, ongoing problems in Japan, an anemic U.S. recovery, dysfunction in Washington, the coming fiscal cliff, and the first decline in S&P 500 earnings in three years.” Its conclusion is that “while these problems are fairly well-known, they have not been factored into the market since investors have been focusing on other factors they regard as highly bullish.” They cite those factors as mainly being investor confidence that the Fed has their backs and “will prevent anything terrible from happening.”

Private-equity funds are having a similar under-performing year, up on average of only 4%. As the Journal says, that is not what their investors planned on. The funds were also suspicious of the rally, and are sitting on close to $1 trillion in cash.

However, U.S. investors remain bullish and confident as evidenced by the resilience in the U.S. stock market. For instance, while China’s stock market is in a bear market and at a 4-year low, the S&P 500 reached a four-year high in mid-September, and has settled back less than 3% since. That’s quite a contrast to the worsening worries of the IMF, China and Japan, U.S. corporations, company insiders, professional hedge fund and other institutional managers.

It’s not just U.S. investors that are confident and bullish, but U.S. consumers as well. The University of Michigan – Thomson Reuters Consumer Sentiment Index was released Friday. It shows that consumer confidence has jumped to 83.1 in October from 78.3 in September. That’s much better than forecasts that it would decline to 78.0.

And at 83.1, consumer confidence is getting close to the 87 level it averaged in the year prior to the 2008-2009 recession. That’s a lot more recovery than global economies have achieved, including that of the U.S.
…

When you have $60 TRILLION of funny money to play with, it’s hard to care about anything except yourself.

One of my Indian coworkers just left Colorado for San Jose. She knows she’ll be paying through the nose for housing, but considers it worth it.

“The Indians I know in silicon valley aren’t all that keen to move to flyover country.”

An Indian “IT guy” left our area for Seattle because his family could never adjust to our below freezing temperatures that last four months or more. The poor guy was even commuting 3-hrs each way for a while.

It was a due to a friend smoking in the car (or so I’ve been told). Fortunately, I see absolutely no evidence my daughter has included smoking on her list of offensive and expensive teenager behaviors.

I assume you’re right. But why did she let the friend smoke in her/your car? And was it really a cigarette?

“But why did she let the friend smoke in her/your car?”

1. Best friend peer pressure.
2. Moral hazard due to knowing that she would not have to pay for repairs, unless her parents somehow figure out how to garnish her future wages.

“And was it really a cigarette?”

Only my daughter, her friend and God could tell you that. (I suppose if I really cared, I could have the fabric chemically analyzed, but I am not interested in pushing the parental hypocrisy too far…)

but I am not interested in pushing the parental hypocrisy too far…)

Hypocrisy?? Are you saying that you inhaled, PB??

Did he do anything to repair it? I’m trying to decide whether it is worth the expense in terms of increased potential resale value.

I know for certain that I would never buy a car with a visible cigarette burn on the seat, which I would view as a signal the car may have been poorly maintained. That said, it truly is cosmetic in this case; car runs like a charm, same as it always has.

I’ve heard tale of a towing company in Seattle that did something very similar: ridiculously expensive rates, followed by similarly extortionary storage rates.

Two possibilities:

- pay to get it back so that you stop accruing storage, then sue in small claims court over the extortionary rates.

- make a stink in the media. Someone did that successfully here. If there is a consumer-advocate news segment, that can work wonders. They covered the extortionary practices in the news, and I believe got the company to lose their contract with the city for towing.