The Housing Bubble

Greed definitely contains an element of stupid.

Lol. No argument there.

It looks as if greed contains an element of fear but I am not sure that fear contains an element of greed.

They are two sides of the same coin. Fear of losing money and the greed to make more money. Fear of not making enough money and greed to keep what one has already made…

Greed to buy real estate and enjoy the home equity wealth gains* and fear of getting priced out forever…

* Remember that real estate always goes up, in the long run.

* Remember that real estate always goes up, in the long run.

Unlike Coka-cola… which had a 70 year run at the same price: 1 nickel.

Discussed on NPR this morning.

did the serving size get smaller?

Blackstone is likely counting on Bernanke’s printing press loaded with M1 paper, and the increasing baby boomer retirement wave spending it in the sun belt. The real question is: Are the unfunded pension obligations going to be voided in court, or paid in full with Weimar dollars?

did the serving size get smaller?

Nope. In the 70 years prior to the first price increase, it was served in soda shops and vending machines, in glasses and bottles, all for a nickel. Wasn’t until some time in the 1950’s that the price started to go up…

It was still a dime in the early 70s when my parents were managing a motel and I was getting paid a dime for watering the flowers. The increases seem to have tracked pretty closely with the devaluing of the dollar.

What is driving the deep pockets to invest is the yield on cost (net income divided by costs). They SAY they are achieving 7% today. Based on what I’ve seen, I would venture that the range (depending on the market) is between 6% and 8%, but that 7% is being achieved. If you don’t believe me, just do the math–and don’t forget to put something in for maintenance and property management.

They SAY that there is a public exit, and that with seasoning (ie. proving the model works), they believe that market yield will be lower than 7% (ie. prices higher when the portfolio is sold to the public).

IF you believe what they say, there will be buying pressure from these entities (or their kind), until the yields are driven from the 6%-8% range down to the 5% to 6% range. All else equal, this means that prices rise.

If you believe their math is flawed, and the business model is going to fail, you should wait (there will be tons of these rentals coming back onto the market).

If you believe that rents are going to fall, which will drive down values, then you should wait.

If you believe that the push for yield by investors is going to shrink, and thus push up the stabilized yields of these portfolios (depressing values), then you should wait.

“…you should wait … you should wait … you should wait.”

Totally agreed on all three points.

So, you:

Believe rents are going to fall; or
Believe their math is flawed; or
Believe that demand for yield is going to shrink.

I can’t say that I believe any of those three things with conviction.

I personally think that the biggest hurdle the plan faces is being able to turn the model into a public enterprise that will value the portfolio at a 5.5% cap, and consequently give them substantial sources of capital to continue to invest (ie. keeping the pressure on home prices relative to rents).

Without this access to public market capital, the appetite from these investors will wane with time, decreasing pressure on home prices that is spurred from their buying activity.

“Without this access to public market capital, the appetite from these investors will wane with time, decreasing pressure on home prices that is spurred from their buying activity.”

Is there a chance political support for the Fed’s housing price support policies might wane at some point?

If so, what then?

I don’t care. One of the Kardashian girls might be getting divorced and that has my attention at the moment.

“If so, what then?”

All bets are off. However, I would point out that other countries do just fine lending to homebuyers without government support…it would take time for these groups to arrange the capital, but they will emerge.

For that reason (time needed), I think the chance that the US government removes support for the GSEs until there are alternative sources ready is pretty small…just look at what we are going through to ask some younger people to wait 2 more years for Medicare…can you imagine the screams (from realtors and homeowners alike) if someone suggested the US stop supporting the housing market? Not holding my breath on that one.

“For that reason (time needed), I think the chance that the US government removes support for the GSEs until there are alternative sources ready is pretty small…”

There seems to be no reason to assume that U.S. policymakers will somehow be able to continue ignoring the omnishambles the GSE financing system has wrought. Why not devise a schedule to phase it out over time, enabling the private mortgage finance market to gradually adjust as a substitute?

The very fact that we have GSE’s or FHA tells me housing was always out of reach here, at least since the 30s.

Housing didn’t go crazy out-of-reach until the mid-2000s, though. And in many areas of the U.S. (especially coastal Cali), prices never returned to earth thereafter.

As I’ve said before, I would be a big proponent of raising down payment requirements steadily each quarter until the GSE’s are no longer competitive…say 0.5% each quarter. If you assume some people are getting 3% down, after two years, the minimum downpayment would be 7%…after 4 years, 11%.

After 10 years, the minimum down payment would be over 20%, and after 20 years, the minimum would be over 40%, but the GSEs would no longer be competitive.

This gives plenty of time for other sources to come into being.

Rents are falling my friend.

And just a note for you folks who believe bullshit like this…….

Blackstone and the others are Fed proxies, fully funded by the Fed. They are not “private equity”. Knowing this fact is key in understanding housing.

“After 10 years, the minimum down payment would be over 20%, and after 20 years, the minimum would be over 40%, but the GSEs would no longer be competitive.”

I like the ‘death to GSEs by slow asphyxiation’ plan.

‘Blackstone and the others are Fed proxies, fully funded by the Fed. They are not “private equity”. Knowing this fact is key in understanding housing.’

If any other branch of government gave special favors to select private firms, it would be illegal, no?

Why is the Fed different?

“Blackstone and the others are Fed proxies, fully funded by the Fed. They are not “private equity”. Knowing this fact is key in understanding housing.”

lol…another “fact”…you sure are full of….”facts”.

Banksters are spending away the country’s future.

“you sure are full of….”facts”.”

And you’re full of lies. They define you here.

Carry on blowing smoke up everyones a$$. Ya liar.

I like the ‘death to GSEs by slow asphyxiation’ plan.

+1.

Long, slow, generational timeframes are the best way to phase in significant policy changes, as it gives markets plenty of both time and direction in order to adapt.

Unfortunately, our political will to hold a course for 40yrs is non-existent. Since the direction of change would never last that long, this “best” approach is also completely impractical.

Unfortunately, I think you are right.

We wasted this crisis when it comes to winding down the GSEs…nothing will get done with Obama. 4 years from now, I doubt the GSEs will be hemorrhaging money they way they did during the peak of the crisis. People will forget…and there we go again…

After this most recent dip downward in stocks, I would look at some REITs for an inflation hedge. Specifically, I would consider industrial REITs (because I think they will be steadiest)…perhaps PLD for global trade related, and at the current price they are paying a 3.4% dividend, and have among the best management in the world for industrial. Perhaps grocery anchored REITs (less likely to be beaten by the internet). I think Apartment REITs are pretty fully valued by now.

The others that I would consider if you are looking for a hedge against housing inflation (as much as I hate to admit it–since they’ve already had a run) would be a broad basket of homebuilding stocks (perhaps a homebuilding ETF). The homebuilders with land will do very well if there is a run upward–although the hedge would have been better placed about a year ago.

The other might be a broad REIT ETF–lots of exposure to lots of REITs…again, hedge against real estate values rising, but not picking winners, just picking a hedge.

The other one would be an ETF that I think is short a 20-year equivalent treasury…if there is 70’s style inflation, this will go through the roof.

I’m sure there are others…as you can tell, I like REITs generally for the inflation hedge…a lot of these guys have reduced exposure to floating rate debt, and have fixed a lot of the interest rates in their borrowings…they will be impacted by higher interest rates, but it will be a muted effect…if rents rise, they will benefit.

My REITs are going down with the rest of the stock market (exactly as FPSS would have corrected).

Correlation is a byatch in a market panic.

corrected predicted

“My REITs are going down with the rest of the stock market (exactly as FPSS would have corrected).”

+1 Assets —> Deflation, Commodities —> Inflation.

Think over your 8-year timeframe…not an 8 week public freakout.

I’m not selling any of my REIT holdings. They are basically there as a hedge against “larger than expected” housing price inflation going forward. I’ve got other assets up my sleeve it that doesn’t happen.

The current government-sponsored lending schemes adversely select borrowers who have nothing to lose. No wonder the FHA is looking at a high probability of a near-term bailout!

Open your wallets and give generously, folks. And rest assured it is for a good cause: Helping somebody else buy themselves a home, even if you happen to be a renter.

FHA Needs Bailout From U.S. Treasury to Plug Budget, Bachus Says
Clea Benson and Cheyenne Hopkins
Published 4:17 p.m., Thursday, November 15, 2012

Nov. 15 (Bloomberg) — The Federal Housing Administration may need billions of dollars in aid from the U.S. Treasury to fill a financial hole caused by defaults on mortgages it insures, House Financial Services Committee Chairman Spencer Bachus of Alabama said today.

“We just learned that FHA is running out of money for the first time in its history,” Bachus, a Republican, said during a press conference on Capitol Hill.

Republicans are ready to work with the White House and Democrats in Congress to address the challenge, he said.

FHA, which has supported itself for the past 78 years with revenue from the insurance premiums it charges, is scheduled to release an annual report detailing its finances tomorrow.

George Gonzalez, a spokesman for FHA, declined to comment.

The current government-sponsored lending schemes adversely select borrowers who have nothing to lose.

Not only do they select borrowers with nothing to lose—they also have made darn sure that they are the lender-of-lowest-standard.

It’s interesting that it has taken almost 4yrs for this ticking time-bomb to tick down to zero. We’ve been expecting it since the FHA made the policy-drive move not to raise their standards when it was not only the rational thing to do, but the thing that every other lender was doing.

They will reap what was sown…

“We just learned that FHA is running out of money…”

Did anyone on the hill see it coming?

People on the hill don’t believe in finite amounts of money…we just print more.

“They will reap what was sown…”

Oh no they won’t. The Treasury has already tipped its hand in the MSM. Sounds like the U.S. taxpayer will reap what was sown (again!).

Bend over and say ‘ahh…’.

“However, the physical house buyer, on whose promises to pay the whole system is based, has a limited ability to do so.”

Doesn’t this depend on whether the buyer is a strong hand (e.g. deep-pocket real estate investor who can dump holdings in a heartbeat) or a weak hand (an end-user household buying a home on a 30-year mortgage)?

There has never been a better time for weak hands to steer clear of home ownership (except for maybe 2006).

I keep waiting for the inertia of the massive credit and housing bust to overwhelm the Fed despite their most hardened efforts to avoid paying the piper. I don’t see how they can win in the long run.

There has never been a better time for weak hands to steer clear of home ownership (except for maybe 2006).

I dunno—I think the weak hands who bought in no recourse states just prior to the big dump made out like bandits. Significant cash-out equity, plus three years of no rent payments seems like a pretty significant windfall to me.

The entire bailout “foam the runway” scheme has pushed us way beyond the risk-reward merit system. There’s no turning back now with our existing and future liabilities looming. At some point down the road Bernanke will quietly load the M1 paper stock in that Weimar printing press, and all the fence sitters will be made fools, twice over.

Before or after inflation?

Before inflation this is what Schwab shows as the highest yields:

1 year: 0.5%
2 years: 0.75%
3 years: 1%

After inflation, assuming you believe the government’s cooked books:

1 year: negative 1.5%
2 years: negative 1.25%
3 years: negative 1

“1 year: negative 1.5%
2 years: negative 1.25%
3 years: negative 1″

Pretty grim choices there…

You want grimmer?

Seth Klarman (Baupost) is one of the people that believe true inflation (using measurement methods from before 1980 or so) is running at closer to 10%…

Plug in the math on a CD at just half that…

Hope is not a strategy. And we know how well that “hope for appreciation” thing turned out for the last round of SFR in-VEST-ors.

I’m sure their average buying price is different in each market based on the economics of that particular market.

Look at the same rents/home prices in Southern CA (where these guys are also active), and you’ll find homes that have sold in the low $200’s, but rents close to (if not over) $2k per month.

And in CA, property taxes are generally 1%, not 1.5%.

The case study: 4641 Merced Ave; Baldwin Park, CA 91706 (also a 3bd, 2ba)

$218k sale price recently (September), Rent Zestimate of $1,830.

I won’t bore you with the same math, but my model with lower property taxes, and 7% vacancy (LA County is actually lower than that), and $700 for insurance, and average fix-up of $12k kicks off a yield of 6.77%. At 5% vacancy for a So Cal portfolio, you are just shy of 7%.

And I just picked the first home I saw in the low $200’s.

BTW, that one was a short sale and needed TLC, so I upped the fix-up to $25k…

Yields at 7% vacancy is 6.4%, and at 5% is 6.6%.

I don’t know, but I heard a person on NPR being out of pocket $400 per month for a 4/2 in San Diego because it was Section 8 subsidized.

I don’t know what the Section 8 portion was, but I’m assuming over a thousand…I’m sure it’s lower in Phoenix/Tucson.

“… I heard a person on NPR being out of pocket $400 per month for a 4/2 in San Diego because it was Section 8 subsidized.

I don’t know what the Section 8 portion was, …”

That would go for over $2K/mo in our hood…

“What does Section 8 pay for a 3 br in PHX or Tucson?”

Octo-Mom hauls in roughly $3k/month from Section 8, IIRC.

“I don’t know, but I heard a person on NPR being out of pocket $400 per month for a 4/2 in San Diego because it was Section 8 subsidized.”

That’s draconian . . . oh the humanity!

Don’t forget the aging baby boomers. Under Clinton and Bush they were working and paying taxes in. Now more and more of them are victims, dependent on SS and Medicare.

“Aging” is obviously a liberal conspiracy. I blame MSNBC.

Because they can…..no more work requirements no more checking assets…no questioning how you can afford an iphone 5……Its looking better and better each day….

There are so many people on food stamps

After having paid in to the system at the highest rate on record since 1983, will the fiscal cliff negotiations screw Baby Boomers out of a significant portion of their promised Social Security bennies?

There are so many on food stamps because nobody wants to/needs to work to feed themselves. That’s why. Its pretty simple really.

liz, was it you that said yesterday that people would work for $2 if they were hungry enough.

And that’s what you want, isn’t it. Dozens of desperate unemployed heads of household fighting for the priviledge of working for you for $2/hour, because feeding the family a half-ration of ramen noodles is better than nothing. And when you have your workforce, you’ll lower your wage to $1.50/hour, knowing that your workers will fight for that too. Then it will be $1/hour. And when the workers realize that it costs more in gas to get to work than the $1 in pay, and they realize that it’s better to starve at home than working themselves to death in your factory and then starve anyway, you’ll fire them for being lazy non-producers, grumbling about how they are unwilling to work, just like Rush brainwashed you to. Once in a while you’ll put a nickel in the charity box to make yourself feel better, thinking it will keep you out of hell.

Think I’m being unrealistic? I’m not. It’s the logical conclusion of unfettered capitalism, and we aren’t far from it. Details of such lifestyles are well documented in the works of Dickens and Steinbeck.

“There are so many on food stamps because nobody wants to/needs to work to feed themselves. That’s why. Its pretty simple really.”

Yes, I’m sure it had nothing to do with a tanking economy and a high unemployment/underemployment rate.

Oxide: That is just the way the World works. Its just a basic law of nature called survival. If you like to think you and your society are more evolved than that then you are just an ignorant fool. You spouting socialist gibberish makes you an arrogant ignorant fool.

I dream of wealth confiscation, followed by imprisonment. I would start with the likes of Blankfein, Mozillo, Fuld, and O’Neill, and throw in Paulson, Corzine, and I could go on, and on, and on. In earlier times, these people would be drawn and quartered.

Grizzly, preach it, bro!

“… drawn and quartered.”

Tar and feathers would work just fine for me.

Don’t buy until at least one of the Wall Street criminals is tarred and feathered!

GrizzlyBear I’ll add you to the international socialist list. I’ve seen these lies before. And the result was an impoverishment of all classes.

Lenon in 1917 objecting to the fact that most people would have their assets taking (when in fact 160 million had no only the assets taken but also their lives). He wrote:

“Nothing of the kind!
Socialists everywhere have always denied such nonsense.
Socialists are out to make only the landowners and capitalists “abdicate”. To deal a decisive blow at those who are defying the people the way the colliery owners are doing when they disrupt and ruin production, it is sufficient to make a few hundred, at the most one or two thousand, millionaires, bank and industrial and commercial bosses, “abdicate” their property rights.
This would be quite enough to break the resistance of capital. Even this tiny group of wealthy people need not have all their property rights taken away from them; they could be allowed to keep many possessions in the way of consumption articles and ownership of a certain modest income.
The question at issue is merely that of breaking down the resistance of a few hundred millionaires. Only in this way can disaster be averted.”

Lenon - 1917

The MID and public school funding are completely different, except perhaps to Retardicans who don’t understand the difference between private goods (housing) and public goods (educational services).

attend public schools on the taxpayer dime

IN a democracy, you can either pay to educate the masses or pay to keep them in prison. Or we can have totalitarianism and just conscript everyone.

It’s an unfortunate choice, but homo sapiens being what we are …

you can either pay to educate the masses

I never said I was against such things. What I am against is people complaining about handouts, who buy into the political rhetoric that 50% of our population are “takers,” while I pay for their kids’ education.

Those people should be forced to wear a scarlet T (for Taker) on their clothes.

…or how about a scarlet H for Hypocrite?

Cheney never did explain that. I believe we are close to seeing that they matter a lot. Maybe it was something that Greenspan told him.

‘…Dick Cheney said that “deficits don’t matter”…’

Perhaps he placed an unreasonable amount of faith in the Fed’s printing press technology?

when Dick Cheney said that “deficits don’t matter”.

they don’t as long as your income grows as fast as your deficit. I heard Robert Reich talking about now is the wrong time to stop spending we need first to get the economy growing again.

I lost my job so I borrow on my credit cards for gas, transportation cell phone, etc all things needed to find another job then I can pay off the credit card.

What happens if you can’t find another job ?

But the people who run things are not wired to worry about these kinds of things. They are wired to move forward and let the little guy fix their big plans when they fail.

what happens when you run out of little guys ?

Another analogy - If I gave these leaders a car they would burn it up in no time driving with both the gas petal and brake on at the same time , then ask for another car taking no responsiblity for wrecking the one they drove into the ground.

As I told my partner (a staunch R) during the Bush years, the only thing worse than “tax and spend” is “don’t tax and spend”.

Bush got none of my votes.

Don’t ruin the fun by popping the two-party fantasy bubble!

“…unfortunately our crappy education system has turned out too many voters who can’t do math.”

Good example of where the Republican plan to defund public education turned into a case of shooting themselves in the feet…

We were lucky to be above the poverty line and only pay 15%.

“Try not to get unduly upset over the election results.”

Seriously, catank, you and the sloth really need reading lessons or something. I’m delighted with the election results and happy to see Rove and Mitt take it in the shorts, just as I predicted. RIP, neoCONS.

I voted for Gary Johnson. I knew he wasn’t going to win.

Is that what Romney meant by self deportation?

“I voted for Gary Johnson. I knew he wasn’t going to win.”

So did I, though I have been informed by a host of bitter Romney supporters that I am actually an Obama voter.

The seppuku solution! Try it now, right-wingers! Before the International Socialists complete our- oops, I mean ‘their’- takeover.

“So did I, though I have been informed by a host of bitter Romney supporters that I am actually an Obama voter”

Well, that doesn’t mean you have to get all over my case, dang it!

I got the same treatment, though, here in my little corner of heaven. “A vote for (anyone other than Romney) is a vote for Obama”.

It’s over!

“Well, that doesn’t mean you have to get all over my case, dang it!”

Sincere apologies, and it was unintentional. Between sarcasm and straw men, I tend to get lost in the political leanings of the regulars…

More info on the Florida man, from the Miami Herald posted 11/13/12:

Henry Hamilton was 64 and owned Tropical Tan on Duval Street in Key West.
The prescription drugs were Xanax for anxiety and Seroquel for schizophrenia.
Hamilton’s partner Michal Cossey said that Hamilton was “stressed about his business.” (Key West is a known center for the gay community.)
Police were making “welfare checks” on Hamilton because they were worried about him.

This is more sorrowful than political.

A gay man who kills himself because the party that wants to treat him as a second-class citizen loses? Sounds like he suffered from Stockholm syndrome, at least.

Maybe it had to do with the tanning tax. Not a rational reason but a reason.

For a guy taking meds for schizophrenia, the tanning tax may be a very rational reason. That’s why it’s so sad. I don’t think the election of Romney would have helped his business either.

A gay man who kills himself because the party that wants to treat him as a second-class citizen loses? Sounds like he suffered from Stockholm syndrome, at least.

Not all that different from the white working poor who vote in lockstep for the GOP.

Not all that different from the white working poor who vote in lockstep for the GOP.

I thought the gays were smarter.

I thought the gays were smarter

Stupidity comes in all flavors.

Tanning salon in Florida?

Tanning salon in Florida?

It was just a room with a hole in the roof. Kind of brilliant really. (He was a betapreneur.)

As a holder of a Top Secret Clearance, the Director’s extra-marital affair exposed him to potential blackmail and therefore the clearance was likely to be suspended or revoked, so he had no other choice but to take the fall.

As for Ms. Broadwell, her clearance was suspended due to a presentation at the University of Denver on 26 October 2012 where she allegedly mishandled classified information. But hers would likely be suspended or revoked for the same reason as the Director’s had she not been under investigation already.

jill kelley would make a lot of men talk.

As a holder of a Top Secret Clearance, the Director’s extra-marital affair exposed him to potential blackmail and therefore the clearance was likely to be suspended or revoked

Sorry, but this makes no sense. All Patraeus had to do was tell his wife and no more potential “blackmail”. There was no reason for him to step down other than his own personal sense of honor (one possibility) or the desire to remove him from the political cover-up that is Libya (another possibility).

You make the assumption that only his wife would care that he was having the affair. A good portion of the right considers adultery a sin, which would damage his public reputation. Maybe he cares more about his reputation than his wife.

As for the Director, there are any number of reasons for him to want to keep the public from knowing if he was having an affair (such as trying to protect the married woman who also held a clearance with whom he was having an affair). It only requires figuring out which one.

Realistically, as the Director of the CIA I suspect he wouldn’t be prone to this type of blackmail, but as Director, he needed to set the example for all levels of the agency. He did the right thing in setting an example for the agency.

“You make the assumption that only his wife would care that he was having the affair. A good portion of the right considers adultery a sin, which would damage his public reputation. Maybe he cares more about his reputation than his wife.”

With a newly reelected Democratic president in the WH, why would he give a rat’s arse what the right thinks about the morality of adultery?

Besides that, is it particularly unusual for a high-level military officer to have extra marital relations? I doubt it…look how quickly the Allen story broke after Petraeus was canned.

There is more to this story than meets the eye, IMO.

You guys are assuming he only had 1 mistress.

You guys are assuming he only had 1 mistress.

+1 I’m starting to think some of these top military guys might have been partying like Strauss Kahn. Sounds like they had their own groupies, who are always an easy ‘touch’, if you’re so inclined.

Strauss Kahn is a different sort of animal, IMHO.

Monica Lewensky a cover up?

Really, that’s what you believe?

Covered up his affair with Janet Reno.

“Covered up his affair with Janet Reno.”

I do [not] want to see that video.

“If fire fighters fight fire and crime fighters fight crime, what do freedom fighters fight?”

- George Carlin RIP

Capitalism worked just fine in the US from 1776 - 1929. Was the US a “Somalia-like” land during those periods?

Let’s ask the kids who lost their hands in the machines, the miners who died from black lung, the garment workers trapped in a burning building, and the elderly beggers on the streets.

Sorry, what does that have to do with Somalia comparisons to the US without regulation?

With all the government regulation today, people still died from fungal meningitis after using infected steroids from a pharmacy in MA. Coal miners still die in cave-ins. Industrial accidents still occur on a regular basis… look at deaths in the fishing and tree harvesting industry.

What’s your point exactly? Is government the answer to the world’s problems? If so, I can show you history books full of governments throughout time that couldn’t do what you think it can do…

America was primarily an agrarian nation until the 20th century, although it had regular booms and busts, both in agriculture and the rest of the economy. People starved, became child prostitutes in brothels, died from lack of shelter and health care, etc. The Good Old Days.

1947 on is the triumph of the New Deal, which was curtailed in 1974 by Nixon, and sent into retreat by Reagan in 1980. It’s been replaced by trickle-down economics and deregulation, which has brought us to where we are now.

You are halfway right though- capitalism reached its zenith during the New Deal years (1947 to 1974) of reasonable government regulation, progressive income taxes, and a strong safety net. We need to get back to that. It worked.

Let’s ask the kids who lost their hands in the machines, the miners who died from black lung, the garment workers trapped in a burning building, and the elderly beggers on the streets.

There is a great deal of romanticizing of that period. That early labor organizers where willing to spill their own blood for the cause might give us an indication of just how bad things were back then for the “little people”.

Is government the answer to the world’s problems?

Straw man 101.

As I said in another post, words have a meaning… and that meaning goes beyond the simple “definition” of the word.

For example, labeling my post a “strawman”, in an attempt to divert the validity of the argument made.

I would argue that Oxide’s post was a strawman argument more than mine… let’s recap:

Let’s ask the kids who lost their hands in the machines, the miners who died from black lung, the garment workers trapped in a burning building, and the elderly beggers on the streets.

Every point she made is a straw man trying to link lack of government regulation and capitalism with these deaths… meanwhile, we have much regulation and government interference today and less capitalism, and yet every one of these things still happens today…

Strawman? Indeed.

Each “straw man” I presented was a real occurrance at the turn of the 20th century, when you said “capitalism worked just fine.” Sure, if you were the 1%.

With all the government regulation today, people still died from fungal meningitis after using infected steroids from a pharmacy in MA.

Really??? What government regulation?

“But, as in keeping with tradition, the main question has been, “Why doesn’t the FDA regulate compounding pharmacies?” The answers are quite peculiar. First, the FDA actually doesn’t appear to have the authority to do so, according to Kevin Outterson, director of the health law program at Boston University. As collateral damage in a 2002 suit, (Thompson vs. Western States Medical Center), in a Supreme Court ruling regarding a pharmaceutical company’s advertising and free speech, the FDA lost much of its regulatory oversight of compounding pharmacies.”

http://blogs.scientificamerican.com/molecules-to-medicine/2012/11/15/elections-have-consequences-fungal-meningitis-and-compounding-pharmacies/

Oh, but they were business friendly!

The compounding pharmacies in question are regulated by the states, in this particular case, the state of MA, so yes, there is in fact regulation. And in fact, the state of MA pulled the permits of the business in question, after the fact, of course. Seems government regulation failed.

As I said, government is not the answer to the world’s problems. There will always be people willing to break laws, skirt regulation, and put people’s lives at risk for the sake of profit. It’s no different than the laws governing our society… do we need more ways to break the law and be put in jail? How’s this: “Don’t be evil”. That’s Google’s business philosophy. Seems to work pretty well for them.

“Capitalism worked just fine in the US from 1776 - 1929.”

Actually, no it didn’t. There were a lot of “mini”-depressions and bank collapse during that time.

Ever heard of the 1st and 2nd Bank of the United States?

Actually, no it didn’t. There were a lot of “mini”-depressions and bank collapse during that time.

You really don’t have a clue do you? Markets have cycles, including booms and busts. It’s natural. Nothing changes that, not even socialism…

Only in the mind of the deluded do economic failures count as successful.

Small recessions direct capital and labor from unproductive industries to more productive industries. They are very useful, just like fires in the West that burn just the debris on the forest floor. Interfere with this natural cycle and you have destructive crown fires which kill the trees. It is not delusion but an understanding of your of economics that is being demonstrated by Northeastern’s comment.

Only in the mind of the deluded do economic failures count as successful.

Truly you are hopeless. I’ll give you a softball pitch: What do all complicated systems have in common, from population dynamics to global climate to solar activity to economics?

Here’s one that’s a bit more abstract for you, but related to the above question: Are socialists God-like in their power?

My statement stands and thanks for proving my point.

Panic of 1797
Depression of 1807
1815-1821 Depression
Panic of 1837
Panic Of 1857
Panic of 1873
Panic of 1893
Panic of 1907
Depression of 1920-21
Great Depression 1929

“What do all complicated systems have in common, from population dynamics to global climate to solar activity to economics?”

Stability is the desired state. Instability causes destruction. Instability in man made systems is often due to negligence or outright pathology.

As for socialism, it worked for the bankers, didn’t it?

Stability is the desired state.

Stability may be the “desired” state, but it is an illusion in any dynamic system. Equilibrium can be achieved only in a laboratory, where each variable and input can be controlled. The normal state for each of the systems that I mentioned is of constant change. The direction of those changes work in cycles determined by their respective feedback mechanisms.

As I asked before, do socialists have God-like powers that they can manipulate cycles of complex systems in ways that don’t exist in nature? I think not…

As I said in another post, words have a meaning… and that meaning goes beyond the simple “definition” of the word.

And your meaning is “biased” beyond logic. Yes. It’s you.

I’ll give you a softball pitch:

You don’t have the mental capacity to pitch that.

Why? Your mental capacity is poisoned by dogma. I’m wrong? Read your words. They are a study in politics and not fact. Your facts are jack sh!t.

Don’t worry Rio, mommy and daddy government will protect you from those rascally capitalists.

Don’t worry Rio, mommy and daddy government will protect you from those rascally capitalists.

Protect? I’m your capitalistic wet dream. Seriously. I’m what you want to be. But you don’t have it in you to be my kind of capitalist…… judging by your mental make up….. imo…..you are a wannabe.

Is there enough room in your mom’s basement to support your enterprise?

Is there enough room in your mom’s basement to support your enterprise?

My mommy doesn’t live in Brazil nickpapageorgio. You don’t have the balls or the money to leave your mommy and go to Brazil. I did. You can’t carry my luggage nickpapageorgio. I’m what you want to be. You’re a wannabe.

“They are very useful, just like fires in the West that burn just the debris on the forest floor.”

Like this one?

“Stability is the desired state.”

Death is 100% stable.

“I’m what you want to be. But you don’t have it in you to be my kind of capitalist…”

Marx and Engels were real capitalists, too.

The compounding pharmacies in question are regulated by the states, in this particular case, the state of MA, so yes, there is in fact regulation. And in fact, the state of MA pulled the permits of the business in question, after the fact, of course. Seems government regulation failed.

Seems state government regulation failed. And yet I’m so often assured that the states are so much better at such things than the federal government.

” I’m what you want to be”

Sorry Rio, I’m straight and have no desire to switch teams.

You’re no longer welcome at my bunker.

Mormon women don’t work.

“Mormon women don’t work.”

False.

Is the Mormon religion “openly masculine?”

I ask because Im looking for one where it won’t be used against me.

I’d have to have an exact definition to even have a chance of answering that correctly. They do put the father at the head of the home, if that’s what you mean. They do kind of a “separate but equal” thing on the sexes, which makes more sense to some people than it does to others…since there is a precedent for considering that to be inherently unequal.

“They do put the father at the head of the home, if that’s what you mean.”

That’s the official policy. But I have been around Mormon men (some of them close relatives) who turn into pussy cats in the presence of their wife’s territorial domain.

Yeah, different arrangements work better for different personality types :-).

My FIL and BILs are all macho men, except for when they are at home with their families. A piercing glance from the queen of their domicile can turn them into sniveling pussy cats…

“My FIL and BILs are all macho men, except for when they are at home with their families. A piercing glance from the queen of their domicile can turn them into sniveling pussy cats…”

+1 Cowering dogs!

Seems to make them employable anyway.

Money in the hands of the citizens creates jobs.

From a consumption point of view, yes, but that only lasts as long as the money does. It is jobs, a continuing source of income, that is necessary. Without jobs, there is no continuing source of income, not for the citizens and not for the government via taxes.

It is jobs, a continuing source of income, that is necessary.

When people have money to buy stuff, jobs are created and maintained. The money has to keep returning to the hands of the people for this to continue to work. If they get it through wages and benefits, then the system can work. If they have to borrow it, it doesn’t work, for long.

It is jobs, a continuing source of income, that is necessary.

yes, but jobs only come from accumulated wealth. ’shoppers’ don’t create jobs, like so many leftists think. that’s because you have to sell something in order to buy something. selling has to come before buying. production has to happen before selling. wealth comes into being, before jobs come into being.

“selling has to come before buying.”

Uh…don’t market transactions between buyer and seller normally occur simultaneously?

And if your (incorrect) point was that production has to precede a sales transaction, I note that purchase contracts are often signed before production occurs.

I note that purchase contracts are often signed before production occurs.

Yes, for established businesses in established markets. But what funding was required to design the first product and bring it to market? Most startups and new businesses don’t have paying customers or purchase contracts prior to entering a market… so again the capital comes first.

That’s why capitalism is called, oddly enough, capitalism. It requires capital to work. Put capital to gainful use and you create value, and importantly, jobs. The question is DOES THE GOVERNMENT KNOW BETTER THAN THE MARKET PARTICIPANTS HOW AND WHERE TO ALLOCATE CAPITAL?

Given the mess that is the housing market, given the manipulation of inventory, the bank bailouts, etc, and now deep-pocketed investors driving SFH prices up in search of returns in an artificially low rate market, I dare say more government regulation and manipulation is the last thing we need.

Note that for capitalism to work, there must be failure and consequences to failure… how many TBTF banks failed? Would we be in the same place today if H. Paulson hadn’t gotten a blank check? There is no consequence to failure with government (other than elections and revolution), thus there is no feedback loop to adjust the market in the short to intermediate term.

“DOES THE GOVERNMENT KNOW BETTER THAN THE MARKET PARTICIPANTS HOW AND WHERE TO ALLOCATE CAPITAL?”

Almost never. ‘Nuff said.

DOES THE GOVERNMENT KNOW BETTER THAN THE MARKET PARTICIPANTS HOW AND WHERE TO ALLOCATE CAPITAL?

right, and government can NEVER know since it can never be sensitive to prices.

There is no consequence to failure with government (other than elections and revolution), thus there is no feedback loop to adjust the market in the short to intermediate term.

very true.

“…right, and government can NEVER know since it can never be sensitive to prices.”

Wrong again. Sorry to have to keep pointing out your mistakes, but somebody ought to point them out.

Wrong again. Sorry to have to keep pointing out your mistakes, but somebody ought to point them out.

lol!

Wrong again. Sorry to have to keep pointing out your mistakes, but somebody ought to point them out.

A more accurate statement might be that the Federal government is less sensitive to prices because they have control of the printing press and the authority to raise taxes and borrow money to meet budget shortfalls.

The “market forces” that would normally keep government spending in check, and thus increase sensitivity to prices, have failed or been subverted… see Federal Reserve, foreign buyers of Treasury debt, credit ratings, and large numbers of constituents reliant on government entitlements if you want a more in-depth explanation…

well, for the reasons you state and more, i don’t think they are sensitive to prices. one might say they have their limits, but it isn’t being sensitive to prices.

just curious.. do you agree that selling has to happen before buying?

I believe that capital comes before either selling or buying. Without capital, there is no business formation, no business development (sales), no product design or development, no machinery or heavy equipment purchases, and certainly no payroll. For all of this to happen, capital must be present.

For most businesses, account receivables are used to pay back lines of credit used to purchase equipment, materials and labor, generally based on purchase contracts sold, but sometimes just based on projected demand. The lines of credit are loans based on credit worthiness, collateral, cash-flow, etc. So again, capital at work which must be present to enable buying or selling.

In my company’s case, we’re bootstrapping it with a minimum of capital… enough for the development of the prototype app which, when scaled out will be the basis for the MVP. But eventually we will reach a point that without additional capital, we can’t expand the business or attract customers… capital first.

But eventually we will reach a point that without additional capital, we can’t expand the business or attract customers… capital first.

yes, i agree with your post. but i’m asking you to consider even further.

suppose just for a moment, that there was no capital. suppose that we were back to barter. in that case, do you see that one must have something to sell before one can buy?

America’s economy is 75% retail driven.

Yes, you can google that.

And where does this “capital” come from? Oh right, the promise that the capital improvments will bring in more customers in the future.

Customers are the job creators, not the guy who says “you’re hired.”

No, it is the promise of a return on investment greater than the risk free rate of return, else why bother putting your capital at risk?

No, it is the promise of a return on investment greater than the risk free rate of return, else why bother putting your capital at risk?

i was talking about barter to make it easier to see.

why bother putting your capital at risk?.. to buy something you want.

i’m saying for someone to make a trade, they must first have something to trade. they must have something to sell, or they can’t buy a thing.

Sorry, that was in response to Oxide’s post, not your’s TJ.

As to your question, yes, in a pure barter economy, I can see your point. Where it breaks down is that even in barter economies, credit can be used in lieu of actual goods exchanged…

Where it breaks down is that even in barter economies, credit can be used in lieu of actual goods exchanged…

sorry about the mix-up.

yes, but even credit is a promise to pay something. that ’something’ is what you are offering in trade. you can’t trade unless you have something to trade. it doesn’t matter when that something was made. and using currency to buy something is just an advanced form of barter.

production has to happen before selling.

dumb

‘And where does this “capital” come from?’

The Fed’s printing press technology.

Was that a trick question?

If the market is so great at pricing, then why are booms and busts part of its normal cycle (as we are told).

I’d settle for an end of crony capitalism.

No complaints from me.

It’s because the jobs they would have landed in better times have been offshored

This speaks to what SFBayarea posted yesterday… that globalization was the primary cause of the decline of the middle class here and the ascendance of a middle class in numerous countries throughout the world…

Being a nationalist, I say America first, but being a capitalist and realist, I also realize that fair global trade increases the wealth of all participants.

To expand on that, I think what has happened is that the bar has been raised noticeably here in the US in regards to what is required to gain full employment given the overseas competition. If you want a job in the US now, you better be able to add more value than the guy in India or Singapore or China…

If you want a job in the US now, you better be able to add more value than the guy in India or Singapore or China…

…while paying for a much higher cost of living.

“I also realize that fair global trade increases the wealth of all participants.”

I know several million Americans who would disagree and can prove it.

Your delusion is astounding.

I know several million Americans who would disagree and can prove it.

Your delusion is astounding.

LOL. I’m delusional? You’re just plain ignorant of any sort of economic facts (or history for that matter). Who is the largest exporter in the world? What does the term “exporter” mean and why is that term important?

What was Smoot-Hawley and why does it matter?

…says the poster who thinks failure is success.

But let’s look at what that ignorant and socialist publication, the Wall St Journal has to say:

http://online.wsj.com/article/SB125798515916944341.html

(see chart)

Oh dear. It seems that the global economy is NOT helping US workers. Since 1970.

Yep. Just plain ignorant.

…says the poster who thinks failure is success.

Failure is not success, but it is not without value.

Colin Powell:“There are no secrets to success. It is the result of preparation, hard work, and learning from failure.”

Albert Einstein: “The definition of insanity is doing the same thing over and over again and expecting a different result.”

I’d settle for an end of crony capitalism.

No complaints from me.

Liar. You…. Northeastener are a poster boy for crony-capitalism. You just hope people are too dumb to see your act.

LOL. I’m delusional? Northeastener

Yes. That’s what we know.

“… failure is success.”

How about, ‘Failure is a stepping stone on the path to success’?

If you want to quote Colin Powell on failure:

“We know that Saddam Hussein is determined to keep his weapons of mass destruction, is determined to make more.”

- Colin Powell February 5, 2003

“…until 2020.”

Are you familiar with rational expectations theory?

What producing it here appears to do is to somewhat buffer the U.S. against price fixing by countries from which we import oil. (Historical reference: Establishment of OPEC in the early-1970s…)

Dumb questions of the day:

1) Is the US an OPEC member?

2) If no, will we soon join?

The Centennial State is an interesting place. On one hand we have TABOR, which keeps government spending in check. But right now, both houses and the governor’s mansion are controlled by the Dems.

The Vermont branch of my family is like that. One of my cousins lives with his second wife, his son, sometimes her son, and, get this, sometimes her ex-husband comes around and stays for a while. Oh, my Aunt Jean and one of my other cousins live just a few minutes away.

They’re all very congenial toward each other, and toward the rest of the family as well. I love going to visit them.

Back in the day, it seemed like older kids were rarin’ to get out on their own as soon as they could. Now they check out the rent prices, change their minds and get too comfortable in the parents’ basement. They don’t want to spend that much of their disposable income on housing when they have a $200 phone bill every month, and credit cards bills to pay.

Back then, couldn’t you have a part time job and still make it? Better yet, couldn’t you work for a summer or two and pay your way through college? Or start out entry level and get a chance to prove yourself and move up without a degree?

I take that as a good sign. A sign that already burdened students and young people are maybe learning a lesson. Well, maybe I’m just hopeful.

Back in the day, it seemed like older kids were rarin’ to get out on their own as soon as they could.

Houses are bigger and parents are cooler now.

Good thing - helping your kids out early in life so they get a good start.

Bad thing - enabling your kids bad habits early in life so they learn dependancy.

Worse thing - being a hypocrite about the help received when younger.

If you’re talking about the 1960s and early 1970s, the minimum wage could buy a lot more. A little minimum wage job could pay for a crappy little apartment. Then high inflation came along in the middle and late 1970s and the Congress failed to increase the minimum wage to keep pace with inflation. Now the standard of living of a minimum wage worker quite low. There was also that “generation gap” in 1960s and 1970s which made it more it difficult for young adults to live with their parents.

This chart says it all:

http://billmoyers.com/2012/04/02/making-the-rent-on-minimum-wage/

Minimum wage earners make up a small percentage of the working population of the US (1.7 million workers out of 155 million, including UE). The bigger issue is there aren’t enough jobs being created.

The US economy needs to create at least 125,000 jobs each month just to keep even with population growth and demand.

“…sometimes her ex-husband comes around and stays for a while.”

I know a guy in town whose wife ran-off with another man, and strangely enough he hooked-up with the other guy’s wife. No chit, a real life wife swap!

The media loves those rags to success stories, but people rarely hear of the failures.

You know what they call a failed entrepreneur in Silicon Valley? Experienced.

Failure is part of the learning process. It is the persistence to work through failure that drives them to work past what may seem insurmountable odds. Where does that persistence come from? A belief that the desired outcome can be achieved…

That gets back to the original point of the article. Having some wealth in your family allows you to pay for that experience without becoming homeless. Which is one of the biggest advantages of family wealth. The lower classes can’t afford a lot of experimentation.

+1 Carl…Spot on…

You nailed it, Carl.

Not every failure is equal, either. Do you know what a lot of employers call people who keep failing to get jobs? Unemployable. While it’s nice to hear of those people who can take their failures and turn it around, it’s not possible for everyone. It’s arguably harder to be in situations where your outcomes depend all on on other people. It’s really easy to say buck up, or to learn something, or to be more competitive. However, there are simply not enough jobs and experience to go through.

My whole point is it’s really easy to blame people for all of their own circumstances, however, it’s commonly more complicated. Not only that, but all of the purposed ideas boil down to either “If you want it enough, you’ll get it”, or “If I can do it, you can do it”. It’s rather simplistic and not really helpful at all.

I’ve always thought humans tend to believe they, and everyone around them, have more control than they actually do. If you think about it, it’s less bitter. If you realized a lot of people suffer through no fault of their own, it’s simply depressing.

The lower classes can’t afford a lot of experimentation.

Which leads us back to where small-businesses and innovation generally come from. Not the lower classes, rather the middle and upper class. And yet, we see continued arguments to make it more difficult for the middle and upper classes to start and run businesses successfully.

Want more jobs? Make it simple and affordable for those with the means and inclination to start and successfully run profitable businesses. The answer is not more government regulation and higher taxes.

California recently passed the Cap and Trade bill requiring businesses to purchase pollution permits from the government. This is a tax and it makes it that much more difficult to start a business in CA without having significant resources already. Same goes for ObamaCare. Does anyone here not realize that any business with 11 or more employees must contribute significantly to the cost of employee health insurance or pay a fine of $2000 per employee? Does that make it harder or easier to start and run a small business?

You can’t have your cake and eat it too. Either you want more jobs or you want more government. The more government you get, the less jobs. Take your pick…

If you want it enough, you’ll get it”, or “If I can do it, you can do it”. It’s rather simplistic and not really helpful at all.

Success in any venture requires the right mix of ability, preparedness, and timing. Just wishing for success is not enough, but not believing you can succeed will lead to failure as quickly as not being prepared or having poor timing.

My comments do not repeal the need to be prepared, through experience and education. It’s taken me 15 years of working for others in the software and technology industry to get to the point I am at today. University and 15 years of industry experience, of learning new technologies, new business models. Without the absolute belief in the eventual success of my venture, I would be just another software developer collecting a paycheck from an employer, like thousands of others…

This isn’t a “pat-on-the-back” or some “narcissist” rant like some were commenting yesterday, regarding SF-BayArea. This is my reality. The financial and emotional stakes are enormous for me and mine and it is a constant struggle to make progress amid the pressures of life, work, family, society.

How many times have I quoted “Fight Club” here with comments about “Not being special”? And I believe it. I’m not special. I am not doing anything that someone with similar levels of intelligence, experience, and education hasn’t done before. I don’t expect special treatment, nor praise. All I expect is the opportunity to achieve… and further government regulation and taxation just hinders that.

Either you want more jobs or you want more government. The more government you get, the less jobs. Take your pick…

Pick this.

Netherlands Unemployment Rate Sept. 2012: 5.4%

And we’re “either with you or against you”

realize that any business with 11 or more employees must contribute significantly to the cost of employee health insurance or pay a fine of $2000 per employee? Does that make it harder or easier to start and run a small business ??

Who pays for the health care if they don’t have any insurance ??

Not only that, but all of the purposed ideas boil down to either “If you want it enough, you’ll get it”, or “If I can do it, you can do it”. It’s rather simplistic and not really helpful at all.

Kind of like “everything happens for a reason” and “God put you where you are supposed to be”. Tell that to the thousands of people who die every day from starvation. Or the victims of natural disasters.

Who pays for the health care if they don’t have any insurance ??

And who employs them and gives them a paycheck to live on? There’s a saying: “Kill the plankton and the whales will die”. Well, kill small and midsize businesses with inane, monolithic laws like ObamaCare and you will have lots of people on government-paid health care, because those people will be out of work with no source of income other than their government entitlement check.

The lower classes can’t afford a lot of experimentation.

Which leads us back to where small-businesses and innovation generally come from. Not the lower classes, rather the middle and upper class. And yet, we see continued arguments to make it more difficult for the middle and upper classes to start and run businesses successfully.

Sounds like a lot of trickle-down theory. Make it easy on those that are already more comfortable so that they can create jobs for everyone else. Except then they create or move the jobs elsewhere…

And speaking of ObamaCare, while I agree that it was too watered down and favorable to the insurance companies to be very helpful, REAL healthcare reform would be the best possible thing for people trying to create a new business. Keep them completely out of the healthcare business…

Sounds like a lot of trickle-down theory.

Don’t let the socialist rants of Rio and Eco fool you. Trickle down economics is real and it works… unless you want a classless society where everyone is placed at the same level, i.e. communism.

As I said, the confluence of motivation, ability, timing and means is such that it is primarily the middle and upper classes that create businesses in our society and it is those businesses that employ people of all economic classes, from the executive to the factory worker. Nothing can or will change that.

Want to help the “working class” and the “welfare class”? Get them into the middle class through access to good-paying jobs. How will they get good paying jobs you ask? They better have skills, education, and a work ethic that are competitive on the global stage and the government better get out of the way of small businesses to create those jobs…

I’d LOVE to see ANY employer do the COMBINED amount of work their employes do.

It’s a 2 way street.

I’ve personally seen hundreds of small businesses fail because the employer didn’t understand the value their employees provided.

NOBODY is motivated by a job that won’t pay the basic bills, offer advancement or raises.

If the above is being fairly applied, THEN you get rid of your slackers. Because there will be people beating the door down for a job and you product/service will be superior to your competitors by way of motivated employees.

Then your competitor will find a way to sue/change the law on you. And THAT’S where many of the problem regulations come from.

“Does anyone here not realize that any business with 11 or more employees must contribute significantly to the cost of employee health insurance or pay a fine of $2000 per employee? Does that make it harder or easier to start and run a small business?”

I understood that if you have fewer than 50 employees, you may declare yourself exempt without penalty, and if you have fewer than 25 employees, you get a large tax credit for the amount you choose to put towards your employees’ health care.

“Trickle down economics is real and it works…”

Maybe on your planet.

“Trickle down economics is real and it works… ”

This socialist commie newspaper says your so full it that it ain’t even funny.

http://online.wsj.com/article/SB125798515916944341.html

Damn that commie WSJ!

“I understood that if you have fewer than 50 employees, you may declare yourself exempt without penalty, and if you have fewer than 25 employees, you get a large tax credit for the amount you choose to put towards your employees’ health care.”

This is correct.

The “small-business-will-be-hurt” propaganda is a big fat lie and reveals the bearer as just another FIRE sector sock puppet.

You know, the same clowns that got in to this mess.

“Trickle down economics it be real, and its works…” Republican moron 1980

“NOBODY is motivated by a job that won’t … offer … raises.”

President extends federal pay freeze
By Lisa Rein, Published: August 21

President Obama told congressional leaders Tuesday that he is extending a two-year pay freeze for federal employees until at least next spring because Congress has not agreed on a budget for the next fiscal year.

The freeze will stay in effect until a spending plan is passed, but the presidential election makes it unlikely that will happen before the start of fiscal 2013 on Oct. 1. As a result, the president is required by the end of August to come up with an “alternative pay plan” to avoid a legal trigger that would automatically raise federal pay in line with private-sector salaries. The alternative pay plan is usually a routine event signaling that Congress and the White House have agreed on a salary increase for federal workers.

With no budget, the freeze will stay in place until at least April, when a short-term spending deal that congressional leaders reached before their August recess to fund the government for six months runs out. The short-term agreement keeps spending at current levels and is silent on the federal pay freeze.

In a letter to House and Senate leaders, the president reiterated his support for ending the pay freeze with a 0.5 percent raise, to take effect Jan. 1, 2013, that he proposed early this year.

“Civilian federal employees have already made significant sacrifices as a result of a two-year pay freeze,” Obama wrote. “As our country continues to recover from serious economic conditions affecting the general welfare, however, we must maintain efforts to keep our nation on a sustainable fiscal course. This is an effort that continues to require tough choices and each of us to do our fair share.”
…

Eco:

This is what i see everyday dead end jobs, and when you walk in and start asking questions like this…..you’re automatically classified as Overqualified

NOBODY is motivated by a job that won’t pay the basic bills, offer advancement or raises.

Trickle down economics was called “Voodoo economics” by Bush I.

http://en.wikipedia.org/wiki/Reaganomics

To improve the gene pool.

Well done, Ron.

this should be used as justification for what exactly ??

For me I don’t think its justification for anything…Just pointing out the facts…

Just another soul-draining thumbsucker from the media. They kept that noise going for years back during the 90s, until everyone got strangely silent during the tech boom.

I don’t pay attention to it anymore.

What should the government do with all that additional tax revenue it raises from increasing taxes?

Pay down our debt and invest in infrastructure, our people, energy independence, education, health-care, basic science research, small businesses and better food.

What a novel idea Rio…

But what about the military !!…We can’t take money from them to fund these other things….Think of the Children…

Pay down our debt and invest in infrastructure, our people, energy independence, education, health-care, basic science research, small businesses and better food.

When you say it like that, it sounds almost reasonable… though I’m confused by the last one. Is that a commentary on the corn syrup vs. cane sugar debate or something else?

You haven’t noticed the increase in e-coli over the last 10 years? Toxic additives? Lax FDA inspections?

You haven’t noticed the increase in e-coli over the last 10 years? Toxic additives? Lax FDA inspections?

No, but I’m also not looking for it, nor have I been impacted by any of it… one of those “ignorance is bliss” things I guess.

When you say it like that, it sounds almost reasonable…

It is.

though I’m confused

Yes.

American bastardized “Capitalism” failed the middle-class. Get over it…
+100

Disclaimer:
This was brought to you by your friendly neighborhood public school teacher, whose income is completely dependent upon tax dollars from the City of San Francisco, State of CA, and Federal government and whose house was bought with significant aid from said public entities. This statement was endorsed by your local public school teacher’s union in the most liberal, left-leaning city in the bluest Democratic-owned state of America.

Just wanted to make sure everyone knew who was giving a +100 to the statement above…

You forgot to add that I am a flaming homosexual.

As I mentioned about Petraeus and I’ll reiterate for your post above: Who you shag and how is your business and none of mine. .

Don’t take this the wrong way, but when you dis capitalism, the economic system of the US since our founding in 1776, I think it helps to know the economic and political background of the person doing the dissing…

Do you KNOW why there was a revolution in 1776?

Hint: failed capitalism by the first multi-national corporation.

Can you name that company?

Darn you, sfhomeowner, for actually turning those children into employable adults who might work for northeastener’s business someday or earn enough money doing something else to buy his products.

Do you KNOW why there was a revolution in 1776?

Can you name that company?

You have completely omitted a number of poor policy choices by the British to pay for the French and Indian War and used the government enforcement of a monopoly by the British East India Company as an excuse for the failure of capitalism and the cause of the Revolutionary War?

Here’s some history for you to think over that isn’t laced with socialist propaganda:

Proclamation of 1763: outlawed the purchase of land from the Indian, unless the land was licensed by the British.
Quartering Act 1765: forced American colonist to house and feed British forces who were serving in North America.
Stamp Tax 1765: a tax that was imposed on every document or newspaper printed or used in the colonies. The taxes ranged from one shilling a newspaper to ten pounds for a lawyers license
Townshend Act 1767: imposed a series of taxes on all goods imported into the United States
Boston Massacre 1770
Boston Tea Party 1773
Coercive Acts 1774

I suggest you review the history I posted above as it was too much regulation and taxation by the British government that brought about the Revolutionary War, not a failure of capitalism…

“used the government enforcement of a monopoly by the British East India Company”

“not a failure of capitalism…”

Can you even hear yourself?

Just wanted to make sure everyone knew who was giving a +100 to the statement above…

Written by the biased moron …..Northeastener.

“Darn you, sfhomeowner, for actually turning those children into employable adults”

That is if she can take a break from socialist indoctrination long enough to teach basic skills…but I have a feeling the union may frown on that.

Don’t take this the wrong way, but when you dis capitalism, the economic system of the US since our founding in 1776,

Take this the wrong way. USA “Capitalism” is NOT the same as it was in 1776. Good God, Northeastener……Are you dumber than dirt?

Is that a rhetorical question?

“…for actually turning those children into employable adults who might work for northeastener’s business someday…”

Why waste money turning children into employable adults when it is more cost effective to either outsource jobs or to import employable adults from elsewhere?

Gay people still need a memorable Wedding dj……….

You forgot to add that I am a flaming homosexual.

“Can you name that company?”

The story of the Charter of the Virginia Company of London and Jamestown Colony should be required reading.

Sort of like the lacking empathy for the many FB sob stories we used to laugh about at HBB. Have we found a sympathetic case yet?

‘ I wish more people had empathy.’

‘That, you will find, is the missing ingredient in most right-wingers’

‘The fact is that everyone’s experiences are part of history and history can’t ignore the views of some while supporting the ides of others, only people can do that. Unfortunately, people are quite good at excluding the voices they don’t want represented in “their” history.’

‘when learning about politics I enjoy discovering positive things that Democrats have done for society, but learning about the mistakes and blunders of Republicans whom I oppose can be just as satisfying because it provides me with “ammo” for the arguments I support…As much as I don’t want to admit it, I feel a similar rush of excitement when I discover instances where Palestinians were in the wrong and come off looking like villains.’

‘I recently read an essay entitled Fighting Words: Unlearning to Write the Critical Essay, by Jane Tompkins in which she discusses the unsettling feelings we have when we discover something that proves someone or something we don’t like is wrong. Upon finding out that the “other” is morally in the wrong, Tompkins says, “the feeling of supreme righteousness in this instant is delicious and hardly to be distinguished from murderousness” (3). She goes on to say that for her, focusing on the misdeeds of her adversary, “restore[s] vigor and momentum to my argument,” and causes her to feel, “temporarily invincible” (5-6). This feeling of moral superiority in discovering the faults of another can be very satisfying in our constant battle to be “right” but it is also extremely dangerous. It results in us spending our energy on improving our arguments instead of improving our relationships.’

‘I would argue that this feeling of moral superiority is simply a false happiness and sense of security that masks ignorance and confusion.’

‘the knowledge of who is right and who is wrong means nothing. It is not comforting nor is it helpful. It is absolutely worthless. Until we can break free from our obsession with moral superiority, we will not accomplish anything. We must share our stories with the goal of increased awareness, accept the other’s story and move forward.’

http://untilnextyearinjerusalem.com/tag/moral-superiority/

Have we found a sympathetic case yet?

Selection bias?

“Politics — the gentle art of getting votes from the poor and campaign funds from the rich by promising to protect each from the other.” — Oscar Ameringer

I’ve felt that way before, Ben. It’s an active battle to not always be “right”, and I think it’s absolutely necessary to consider as many perspectives as possible. After all, we only have facts. Anything after that is an opinion, and what happens in my life may have not happened in others (and vice versa).

Thank you, Ben. We all assemble facts differently, and somewhere in the soup comes the truth. Temporarily….

“Selection bias?”

That’s the thing - why would a sympathetic media pick so many stupid cases to highlight? It’s almost as if they wanted to undermine empathy.

Thank you, Ben. We all assemble facts differently,

In the end, facts are facts.

Fact:
2+2=4
Fact:
2+2=11 (base3)

So I’m right that right-wingers have no empathy, but I shouldn’t gloat about it?

‘I’m right that right-wingers have no empathy, but I shouldn’t gloat about it’

‘this feeling of moral superiority is simply a false happiness and sense of security that masks ignorance and confusion’

“So I’m right that right-wingers have no empathy”

Empathy sounds good when you say it to your friends, but what are you really doing to help you fellow human beings? Your answer is to incrementally make them slaves to the state, strip them of all dignity and house them in virtual prisons.

Real empathy involves education (not indoctrination), opportunity, freedom and charity.

Reality!!!

As long as it isn’t California coastal real estate…

It’s a door-to-door airport shuttle based in Davis. The Sac area has a huge population of folks from all over the world who love to talk about what they know over the course of a two-hour ride. And UC Davis brings even more in for short periods of time. That’s one of the reasons I love the job.

Probably a very low time of year. It’s just after everyone has finished fall clean-up and before they buy Christmas decorations.

I’m actually glad to hear that they’re turning a mall into a mega-church. Better to re-purpose than to build new and allow the old buildings to rot.

The ChiComs will be landing on the moon, though not anytime soon.

Polly, thanks for the exemplar. It adds support to the premise that

1) there are WAY too many lawyers in this country in general; and
2) way, WAY too many in the Northeast, all falling over one another to service those who can afford to pay; and
3) Many, many more of them need to starve in order for this country to have a fighting chance to disinfect.

Like these MF Global goons, they add nothing to the economy, and serve to exacerbate the U.S. GINI index. As shown in this example, protecting the thieves who rape the middle class, whether through real estate fraud, mortgage fraud, or financial fraud.

Rhetorically speaking, don’t get me started about government lawyers and regulatory capture. As far as they are concerned, when it comes to the industries they are supposed to regulate, “no child left behind” is an understatement. One hand washes the other, professional courtesy, post-gov revolving door and all.

BUT - let an EPA lawyer sniff out some hapless homeowner who got sold a house built on a swamp and is trying to make it liveable (the builder having paid off the local Planning and Zoning Board, so is off scott free counting his cash)? Said hapless homeowner will spend the rest of his life in Federal Court. Homeowner has no quid pro quo. Neither has the multigenerational family farm.

There are too many private sector lawyers adding to the rape of the middle class. There are too many tax-subsidized lawyers adding to the rape of the middle class. There are too many d*mn lawyers altogether.

I observe that some of them are very good at what they do (witness the MF Global scum). But what they do, over the last generation or so - it is not worth doing.

We middle class argue about the merits of the respective parties, a head fake that distracts us from the structural dynamics. To paraphrase Combo, no duckydollar will be allowed to escape.

We need a reset to a point where production is valued more than parsing.

Corzine was a Democrat when governor of New Jersey…

Goldman Sachs has never been run by a Democrat.

Perhaps he doesn’t need a party any more.

Oh hey, Rio, I totally agree. But modern corporate structures are quite oligarchic. The voting majority of the company stock tends to be held in a handful of institutional investors and other rich people. So a “compensation committee” can raise the CEO’s pay by 140% even in the midst of bankruptcy, and nothing much can stop them. The majority shareholders obviously don’t care, and that’s all that matters. In the case of Hostess, there just happened to be bankruptcy rules that the elite flouted, and so they got burned.

But only just. It’s not like any of them went to jail for it, of course. We don’t jail thieves of millions anymore. We frankly admire them for their pluck. We want to BE them. Until that cultural disease is conquered, nothing can improve.

Most advertising mailers stopped being effective 40 years ago.

There’s corruption in unions, no one is arguing that. Show me ANY group with some amount of power, wealth, or clout that doesn’t have any corruption. Doesn’t exist.

But if that’s the reason for getting rid of unions, then you would have to argue for getting rid of any and every other group or organization or company that also has corruption in its ranks.

Let us know when they need a multi-trillion dollar bailout because of fraud.

sfhomowner, when corruption becomes that egregious, it’s time to introduce radical change. This includes the possibility of destroying said corrupt organizations.

Union you say! But, but, how can those models of efficiency and capitalism work if they are union!

Unpossible!

FWIW, if I buy a graphic novel (or any book for that matter) I like to be able to hold it in my hands, to turn the glossy pages, etc. The whole Kindle paradigm doesn’t appeal to me. Real books don’t need batteries. And you can’t download real books over the internet.