Bits Bucket for November 18, 2012
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The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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nhz — wherever you are, we told you so, pal!
The Crash of the Dutch Housing Market Reminds us of Older Bubbles
08/25/2012 8:11 PM
By Walter Kurtz, Sober Look
From the country that brought us the tulip mania - roughly on the 375th anniversary of the tulip bubble crash – comes the latest property market correction in the Eurozone.
…
nhz — wherever you are, you were right, pal!
To be fair, we can’t “tell him so.” nhz never denied it would happen. He knew it was a bubble and just reported the news to us in disbelief and disgust.
He did, however, rightly predict it would take a long time because of the extremity of the government support.
“…a long time…”
That was the part I was remembering. It’s been a long time since he posted, but my recollection is that he more-or-less predicted the Dutch housing bubble would never end, at least so far as this generation was concerned…
Perhaps he was right, he may be no longer with us.
nhz never denied it would happen. He knew it was a bubble and just reported the news to us in disbelief and disgust.
As with me in Brazil. I know it can happen here too. But I’m not disgusted.
I never believed that the U.S. would have done the things we’ve done. But nhz called it. At least now there’s hope that this can’t go on forever, at least in Holland.
ANALYST: Canadian Home Prices Will Plunge 25% From Here
Mamta Badkar | Oct. 26, 2012, 3:18 PM
Canada’s sub-prime mortgage industry is said to be growing and there are supposed to be $500 billion in high-risk mortgages in the Canadian housing market.
But some like Robert Shiller have argued that if Canada’s bubble were to burst, Canada’s experience would be very different from the U.S. because banks aren’t as burdened by sub-prime loans and because the mortgages are insured by the Canadian Mortgage Housing Corp. (CMHC).
A new report by Capital Economics however says Canada is “not immune to potential sub-prime problems”.
While they argue that there isn’t a sharp distinction between prime and sub-prime lending and that non-prime mortgages account for 20 percent of total residential, unlike the 50 percent touted by many, they do think there is too much optimism about Canada’s housing market:
…
Just 25%.
I don’t believe it. It’s a very optimistic “analyst” type opinion.
Get him drunk and he’ll probably admit the truth.
Yeah. A 25% decline in prices to a Housing Crime Syndicate operator is actually a 75% decline.
To be fair, I know a few of these types of people.
They know that if the estimate “sounds” too ridiculous to people, they will be counted as crazy and their opinions and reputations trashed.
So there is a natural tendency to not sound so pessimistic which is a big no-no in American society. Always look on the bright side of life, as Monty Python might put it.
Which doesn’t make the estimate any better, of course.
“Mom’s on the roof.”
‘They know that if the estimate “sounds” too ridiculous to people, they will be counted as crazy and their opinions and reputations trashed.’
That’s a great explanation why so many economists are fond of saying, nobody could have seen it coming.
I had many an argument with otherwise seemingly very bright people about the housing bubble back during the 2000-2005 period. They generally either got it, or completely missed it.
Around that time, I realized that the best technical skills and training in the world were a poor substitute for something that apparently cannot be taught: Economic intuition.
“Economic intuition” aka common sense.
Something a twelve-year-old paperboy could understand.
If you describe econonomic matters in paperboy terms then the average person can understand and can follow along.
But if the average person decides to rely on a advanced degreed annointed quant-type of person who uses computer-generated spreadsheets and lots of Greek letters and such then the average person will become lost. And because he becomes lost he needs to rely on the advanced degreed annointed quant person for guidance.
What the quant says becomes The Truth because seemingly only the quant knows The Truth, and this Truth he knows is backed-up by the computer and the spreadsheet. And if you, the unwashed layman, decide to challenge the quant you will lose because he is seen by most people to be privy to the truth and you, because you are an unwashed layman, are not.
I had many an argument with otherwise seemingly very bright people about the housing bubble back during the 2000-2005 period. They generally either got it, or completely missed it.
The problem is that they didn’t want to understand. They wanted to make an easy killing.
“The problem is that they didn’t want to understand. They wanted to make an easy killing.”
BINGO.
And for them to acknowledge the truth would mean coming out of their fantasy.
New housing bubbles set to burst
Central banks and governments should focus on deflating bubbles before they grow large enough to be dangerous.
Last Modified: 24 Jul 2012 20:29
Dean Baker
In Canada, the average house price is more than 70 per cent higher than in the United States [REUTERS]
The United States has more than 20 million people unemployed, underemployed or out of the workforce altogether because of a burst housing bubble. We also have more than 10 million homeowners who are underwater in their mortgages. And, we have tens of millions of people approaching retirement who have seen most of their life’s savings disappear when plunging house prices eliminated most or all of the equity in their home.
This situation could have been prevented if the government had taken steps to stem the growth of the housing bubble before it reached such dangerous levels. It is incredible that the Bush administration’s economics team failed to see the dangers of the bubble. It is even more remarkable that Alan Greenspan, Ben Bernanke and the Fed ignored the growth of the housing bubble. But even more astounding is the fact that no one in a position of authority has learned any lessons from this disaster.
At the moment, there are housing bubbles in the United Kingdom, Canada and Australia that are arguably larger, relative to the size of their economies, than the one that collapsed and wrecked the US economy. The basis for saying that house prices in these countries are in a bubble is that there has been a sharp increase in the sale prices of homes that has not been matched by a remotely corresponding increase in rents.
Huge gap in house prices
In the case of the UK, house sale prices increased more than 115 per cent in excess of inflation between 1996 and 2010. Over this period, rents pretty much kept even with the overall rate of inflation. In Australia, house prices rose by more than 80 per cent between the start of 2002 and end of 2009, a period in which rents rose by roughly 30 per cent. Canada has a similar story.
The average house price in the UK is now almost 60 per cent higher than in the US. It had been 20 per cent lower in the mid-90s. In Canada, the average house price is more than 70 per cent higher than in the United States. The price of the median house in Australia is more than 225 per cent of the median house price in the United States.
Given that wages in the United States are the same or higher than in all three countries, it is difficult to see how this huge gap in house prices can make sense. Furthermore, since rents have not notably outpaced inflation in any of these countries, it does not appear that the price increases are being driven by the fundamentals of the housing market. If there was a serious shortage of housing we should expect it to be showing up in rents as well.
In short, there is good reason to believe that house prices in these countries will not be sustained anywhere near current levels. All three are likely to see the same sort of house price collapse that has wreaked so much havoc on the US economy. It’s impossible to know what the triggering event will be; a rise in interest rates could certainly deflate a bubble quickly.
…
The American housing bubble was engineered because trickle-down Capitalism failed America. It was obvious that real wealth was pooling in too few hands so housing bubble fake wealth was engineered upon the middle-class to buy about 20 years of fake wealth. And when it evaporated, most of that fake wealth turned into real wealth for the rich.
The American housing bubble was engineered because trickle-down Capitalism failed America.
(IMO)
I don’t know if there was a mastermind engineering the housing bubble, but there were plenty of evil enablers…still are. Some of us escaped the worst of it by refusing to go into debt to keep up with everybody else.
Amen.
Beware the mania which seems destined to continue without end.
Great Speculations
Buys, holds, and hopes
Investing
10/03/2012 @ 2:43PM
Greatest Real Estate Bubble In Modern History Not Done Bursting
Harry Dent Harry Dent, Contributor
Foreclosure sign in Las Vegas, Nevada, November 8, 2010
Never in history have so many middle class households been able to borrow so much against real estate at such low mortgage rates. In the last great debt bubble in the U.S. that peaked in 1929, the average household could not afford a house and had to put down 50% and get a 5-year balloon mortgage. Hence, home prices did not bubble as much as stocks and then they only fell 26% in the worst depression in U.S. history.
In emerging countries never have new middle and upper class households grown so fast, even though the average household similarly cannot remotely afford to buy a house in a major city like Shanghai. We shouldn’t be surprised at what happens after a major housing bubble bursts as Japan went through this starting in 1991 after home prices rose 160% in just 6 years and then fell 64% — and they are still down that much 21 years later as a smaller generation followed a large baby boom for the first time in history. The U.S. followed with a 130% bubble up in 6 years from 2000–2006.
My summary insight from studying hundreds of years of all types of manias and panics is simply that bubbles always burst, and then they go back to where they started or a bit lower. Even we’ve seen doubling and better in the stock prices of homebuilders like Toll Brothers, Lennar, KB Home, PulteGroup and others you find in the XHB or ITB ETFs, it’s unlikely that this latest bubble bursting in real estate is truly finished.
The Japanese market went back just below where its bubble started in 1986. For that to occur in the U.S., home prices would have to fall 55% – 65%, not the 34% we saw at worst in 2009. Around the world, the greatest bubble by far occurred in Shanghai, up 525% since 2000, and in China in general. (China’s supposed to have a soft landing?) Mumbai saw a 400% bubble, Dubai 300% and Seoul 205%. The greatest bubble in developed-country cities starts with Brisbane, Australia at 210% followed by 180% in Miami, 170% in L.A. and 165% in Vancouver. There are many cities that could see real estate drop 70% to 85%!
The only cities that had major bubbles and have already seen them fully erased in the U.S. are Phoenix, Las Vegas and Atlanta. No other major bubbles have burst back to where home prices are affordable again, and major cities from Shanghai to London to Vancouver to Melbourne and Sydney, Australia, are still going up or very near their peaks.
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Is it time to lever up on real estate and buy multiple homes again?
Isn’t that what everyone is doing?
That’s what I see.
My MIL went to Seoul a few months ago and took a picture of this HUGE development they were adding on to somewhere near by. It looked like the ghost cities of China, and I believe the condos/apartments were priced at $400,000 and up, but barely anyone was buying. It had this giant fountain and lights that changed different colors when it was dark, though. Maybe that’s “worth” 400k, hah!
This claim of “three bubbles in the last decade” is a typical MSM strawman misconception of what a bubble is.
Bubbles are much more pervasive, and take far longer to deflate (decades, not months), than most commentators either understand or acknowledge.
Simon Montlake, Forbes Staff
International
10/03/2012 @ 6:03AM
Standard Chartered Sees Chinese Housing Rebound In 2013
China is no stranger to housing bubbles – the IMF tallied three in the last decade. The latest bubble, if you want to call it that, began after 2009′s stimulus flooded the economy with credit, and peaked in early 2011. Ever since, doomsayers have been waiting for an implosion. Yet, while sales have softened and some developers have back-pedaled on projects, prices haven’t exactly crashed. Still, the weaker property market has fed into China’s economic slowdown. Now Standard Chartered reckons that a turning point has come, and that new construction will pick up in 1H 2013. Residential property will “turn from a drag to a positive” for China’s economy, and, by extension, commodity exporters dependent on the industry. In a research report issued Wednesday and titled, cheekily, ‘You’re going to need to sit down for this’, StanChart points to year-on-year gains in apartment sales in August and renewed appetite by developers to acquire land. It also reports that credit conditions for developers has improved. “As long as apartment sales continue at present levels and inventories continue to fall, this trend of buying land should build.”
…
This Wikipedia entry dates the Chinese property bubble from 2005-2011. Isn’t it a bit early to try to call a bottom at this point?
Chinese property bubble (2005-2011)
From Wikipedia, the free encyclopedia
An empty corridor in the mostly vacant New South China Mall.
The Chinese property bubble was a real estate bubble in residential and/or commercial real estate in the People’s Republic of China. The bubble started to deflate in late 2011 when housing prices began to fall,[1][2] following policies responding to complaints that members of the middle-class were unable to afford homes in large cities.[2] The deflation of the property bubble is seen as one of the primary causes for China’s declining economic growth in 2012.[2]
The phenomenon had seen average housing prices in the country triple from 2005 to 2009,[3] possibly driven by both government policies and Chinese cultural attitudes. High price-to-income and price-to-rent ratios for property and the high number of unoccupied residential and commercial units have been cited as evidence of a bubble. Critics of the bubble theory point to China’s relatively conservative mortgage lending standards and trends of increasing urbanization and rising incomes as proof that property prices are justified.
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In the past few months I’ve been thinking about this. I kept coming up with the idea, “What if the housing bubble never left? What if it just slightly deflated?” It makes sense to me deflating could take the same or more amount of time as the inflating took, depending on how it’s dealt with.
I’ve told you that the housing bubble isn’t over. We’re still in the Denial phase of the bubble (ref. “stages of grief”). We’re probably only in the False Recovery of it, when there’s a brief plateau in the general downward price trend.
When I first started reading this blog a year ago, I thought that there were just several housing bubbles. However, it’s not like that at all, and I’m glad I don’t believe this BS about any sort of recovery currently happening. You’re completely right; It’s more like the first stage of grief.
‘We’re still in the Denial phase of the bubble (ref. “stages of grief”).’
Isn’t the psychological economics strategy to keep the sheeple in denial as long as possible?
I agree the bubble is not over, particularly in California. The house prices are not worth it in the beach areas. If they are not worth it in the beach areas, the $500,000 homes listed in the Fullerton area (which I investigated) are way not worth it.
The recent Jerry Brown tax hikes will put more pressure on the folks like Cantankerous to want to move out. Austin, San Antonio, maybe even Tucson would be for the Cantankerous household when their kids are all grown and out of the nest.
http://www.manhattan-institute.org/html/cr_71.htm#.UKkst4ZfRfs
From 2000 to 2010 San Diego County grew by a net of 15,000 people. About 130,000 people moved in while 115,000 people moved out.
From 2000 to 2010 the most popular states for ex-Californians were Texas, Nevada, and Arizona in that order.
I predict another big round of people leaving this decade. An even slower growth in California population and by 2020 California might even start losing people (net population).
Bill, thanks for the Manhattan Institute cite. I’d not looked around that web site before. The CA article in question is thought provoking!
You are welcome Jane!
You’re correct. What you’re seeing is three things:
1. The price drops were cut off by the rising line of inflation. For example, the price of my house bubbled up from early 2002 - 2008. Then, by 2012 when I bought it, it had dropped to a late 2003 price. Why didn’t it drop further? Not because I bought it, but because adjusting for inflation, my 2012 price is equivalent to an early 2002 price. That is, the bubble on my house DID deflate entirely to its pre-bubble 2002 price. HBB guessed this would happen: Treasury is keeping banks afloat until inflation will inflate the real debt away.
The exceptions to this rule are the truly bubbly areas like Vegas and Florida and Arizona, and the truly bubbly homes like condo conversions. Those prices did drop to a pre-bubble Zestimate, at least the ones that are old enough to exist pre-bubble. Adjusting for inflation, they are selling for 1999 prices, less than pre-bubble in real terms. Example: Darrell in Phoenix’s $40K condo townhome.
2. Rising rents. This was my situation. It wasn’t exactly “buy now or be priced out forever.” It was more like “buy now or lose money every month I rent, even if house prices don’t rise at all.”
3. The acceptance that housing is now a higher % of household income. Housing debt should be 28% of gross income. But it’s creeping up to 30-35%. This is the new normal. People figure that the prices now are the new normal, and it’s not worth the rent to wait for further price drops that may never materialize. This is a source of conflict here at HBB. Some of us think it’s the new normal and bought, some of us think the shadow inventory will come and crash prices…. eventually.
As a corollary, there is now 10 years of household formation. The population is increasing slowly and they need a place to live. Even if they rent, somebody still has to own the house.
Among those three factors, there’s enough incentive for investors to rent homes out and buyers to want stability, and therefore to bid up prices of the existing inventory.
Then, by 2012 when I bought it, it had dropped to a late 2003 price. Why didn’t it drop further?
False argument. Your shanty is down to late 2002 prices…. and falling.
The acceptance that housing is now a higher % of household income.
That’s YOUR acceptance. And it’s a symptom of your Stockholm Syndrome.
But it’s creeping up to 30-35%. This is the new normal.
No it’s YOUR new normal. The truth the price/income ratio is falling.
it’s not worth the rent to wait for further price drops that may never materialize
How long did it take for you to come up with this one? Prices are falling.
The population is increasing slowly and they need a place to live.
How realtor-eque. And you believed him and got suckered. The truth? US population growth is the lowest in US history per 2010 Census.
Even if they rent, somebody still has to own the house.
More realtor tripe. I didn’t know you were moonlighting as a Housing Hooker.
The truth? Rental rates in $/square foot are a small fraction of the monthly carrying costs of buying.
Be advised your BS will be met with truth, ALWAYS.
Spendthriftiness, short sightedness, borrowing to keep up with the herd and bad math are the new normal.
The truth? Rental rates in $/square foot are a small fraction of the monthly carrying costs of buying. — in Wechester county NY.
Fixed that for you.
It might be that way in the DC burbs as well. Coastal California for sure.
Flyover country - not so much.
Look bud…. we’re not talking about Frogballs, Arkansas or wherever the flip you’re from but thanks for playing anyways.
I’ve noticed that people here argue over if this is a new normal or not. I think it may make sense for some. However, what about the poorer/lower middle class? I suppose one could tell them to move to another state/country to get a job, but that could be more risky and has no guarantee of more jobs. There’s still a huge disconnect between housing prices for low class/middle class incomes in several places, and those people are definitely paying more than 35% of their take home on housing.
I think it’d make more sense if most people, with the exception of below the federal poverty level, could spend 30-35% of their income on rent or housing without section 8. What I’m seeing is more like 50-70%, especially in Southern California. I think California may be a beast of it’s own, though, given there is 1/3 of all welfare cases here, CALPERS, extremely high unemployment/homeless rates, higher taxes, so on…
During the dot.com bubble I moved from CA’s Central Coast up north to WA’s Columbia Basin where the spread between household income and median home prices wasn’t (and still isn’t) so wide. The home price dampener in this area is the small town rural lifestyle and the winters, which are five months of overcast, wind and bitter cold. The economic backbone here is the Columbia River Hydroelectric Complex that steadily churns out tens of billions of dollars. Next up are the abundant water resources that provide for a productive agriculture industry. A number of other industries that rely on low-cost power have located here too. Many cities don’t appear to have a practical reason for being there other than a critical mass of population.
I moved from CA’s Central Coast ??
Oop’s….
Where exactly may I ask ??
poorer/lower middle class? I suppose one could tell them to move to another state/country to get a job, but that could be more risky and has no guarantee of more jobs.
And in general, moving costs a lot of money.
It sure did me. (But I made it up in volume)
However, what about the poorer/lower middle class? I suppose one could tell them to move to another state/country to get a job.
They are telling the poor/lower classes up to RENT. How to pay the high rents? Roomies, lots of roomies. The days of 2-3 families in one house are back. There are many such in my neighborhood. And guess who owns those rentals…
“the winters, which are five months of overcast, wind and bitter cold.”
You must live east of the Cascades. Even there, the cold does not come close to Montana and North Dakota. November is typically very wet, but we can get dry spells in January and February. West of the Cascades, the crocuses bloom a full month before western Pennsylvania and I would consider the winters there (W. Pa) to be relatively mild.
Where exactly may I ask ??
Los Osos, CA.
“You must live east of the Cascades.”
The Columbia Basin, Ephrata, the channeled scab lands.
The Great Floods of Glacial Lake Missoula
https://www.youtube.com/watch?v=27BP4CL66Tk
“You must live east of the Cascades. Even there, the cold does not come close to Montana and North Dakota.”
East of the Bitterroot mountains the weather is definitely colder, and the snow is deeper too. FWIW, once you are below freezing it really doesn’t matter to me, no cycling or skydiving. Nothing tops the mid-west for miserable weather with moisture laden gulf air always slamming into Canada’s cold fronts; summer humidity and mosquitoes, and long winters in deep snow. Little doubt as to why it’s so easy to blow bubbles in AZ and CA.
Ehh, we should get snow like they get back East. One can only dream.
Housing bubble
Education bubble
Health care bubble
“Green Energy” bubble
Ethanol bubble
Electric car bubble
etc.
What do they ALL have in common?
MASSIVE government intervention.
But the government is only trying to help…
You left out the Bullshit bubble.
(Bubbles) What do they ALL have in common?….MASSIVE government intervention.
I agree with a lot of that. The government does screw up a lot of things. But it’s even more complicated than you suggest. For example, the government intervention in health-care is a half-a$$ed government intervention designed to screw around the edges of a failing “private” health-care system.
Political dogma has hindered America’s path to universal health care and much lower costs.
If America would have just bit the bullet, lost its cowboy “free-market” jive on health-care, and went to single payer as did Canada, the US health-care market would be much cheaper.
And I maintain that the housing bubble was designed to give fake wealth to the masses in the light of massive wealth/income inequality. If America would have followed the path of less wealth inequality, then the housing bubble fake wealth would not have been needed IMO.
Thugernment bubble.
I just wish the war bubble would deflate.
+1 Palmy…The good news is it may have…The majority of the country learned a terrible lesson when you elect a President that acts like a cowboy…
We are in our 2nd Presidential term of a rejection of the neocon ideology…One more time in 2016 should put them away for good…
I suggested many months ago that you would hear anger drumbeats and cries for secession from the union…The only thing left now is violence…
Let the Confederacy go and form their own nation. They can wage the forever war in the middle east for all I care.
I do wonder how the world would react to such a scenario.
Also the war against the U.S. citizens in the form of the “Patriot Act,” which has nothing to do with patriotism.
And our wonderful govt will continue to use it to crush its’ citizenry.
Got shadow inventory?
In Spain’s Housing Bust, Sell-Off Brings Bargains
By SUZANNE DALEY
Published: October 13, 2012
CANET DE BERENGUER, Spain — For years, the Mar de Canet apartment complex in this beach town south of Barcelona stood empty, another casualty of a real estate crash that left this country littered with ghost towns and half-finished developments no one would buy.
But recently, the communal pool at Mar de Canet was full of giggling children, and bright beach towels flapped from virtually every balcony.
Mar de Canet’s 308 units were sold in less than 30 days last spring, mostly gobbled up by eager Spaniards finally getting a deal they could not resist: choice holiday homes for less than half the price of similar properties on the market.
Banks, which have been sitting on a pile of real estate assets or listing them at only slight discounts, are beginning to slash prices, eager to get out of the business of being landlords. Some experts worry that they are simply repeating mistakes of the past by handing out 100 percent mortgages again. But giddy Spaniards — those who still have jobs — are lining up to get in on the bargains.
No one expects Spain’s housing backlog to disappear soon. The country has more than 1.2 million unsold new homes. And Spain is still far from getting its financial house in order. But to the surprise of many, Spaniards have not lost their passion for buying property, at the right price, and some prefer to put their savings in bricks and mortar rather than one of the country’s shaky banks.
…
Ain’t no shadow about it…those new homes are right out in the open…
Spain is 20% larger than the state of California. During the height of the bubble, CA was building about 200k homes per year.
That puts 1.2 million in context….1.2 million new empty homes is a staggering sum.
Tax VOX
Fiscal cliff: Will the states tumble, too?
Fiscal cliff talk has been mostly focused on what would happen to the federal budget and the national economy. But what impact would the fiscal cliff have on individual states?
By Norton Francis, Guest blogger / November 17, 2012
Senate Minority Leader Mitch McConnell of Ky., right, accompanied by House Minority Leader Nancy Pelosi of Calif., left, and House Speaker John Boehner of Ohio, gestures as he speaks to reporters outside the White House in Washington, Friday, Nov. 16, 2012, following their meeting with President Barack Obama to discuss the economy and the deficit. Most of the talk surrounding the fiscal cliff concerns what its impact would be on the national budget, but the states need to be considered as well, Francis argues.
As Congress and President Obama continue to spar over how to avoid the looming fiscal cliff, most public attention has been focused on what tumbling over the edge would mean for the federal budget and the national economy. But the tremendous uncertainty over the threat of tax increases and cuts in federal spending could cause big problems for state budgets as well.
Two new studies, one by The Pew Center on the States and another by the Tax Policy Center, show what falling over the cliff would mean for states. There is a sliver of good news: If all of the last decade’s tax cuts are allowed to expire, states might see a short-term boost in revenues. They might, that is, if the economy isn’t thrown back into recession.
…
I read the other day that 10% of Texas’ state budget is financed directly via Federal Cheese. This doesn’t even count other ways Fed money flows back into the state, such as military bases.
So yeah, the states will get clobbered too.
It’s about that much here, too.
The economy stinks no matter how they fix this fiscal cliff. When this charade ends then comes the new call for more stimulus, even though it will make the hole they just agreed to fill in bigger.
I think people are getting the impression that because no fiscal cliff fix = recession, then fiscal cliff fix = no recession. It ain’t necessarily so.
I think we are already there.
then fiscal cliff fix = no recession. It ain’t necessarily so ??
I would agree….We can point-counter-point the reasons but the fact is there has been a ton of government cheese thrown in “all” directions…The party is about to come to an end and the tab needs to be paid…And everyone is going to pay…
I still look for a AVT…Its the one way you may be able to get the cash economy to pay whats duly owed… Treasury Sec. O’Neill says that it is estimated that $400-bil a year goes uncollected…Thats a lot of Bil’s…
Major tax reform with simplification & collect-ability is what I see coming and I think it will happen by Obama’s third year…
They are definitely collecting from the little guy. I moved from the Midwest to Maryland 2009-2010. Soon after, Maryland sent me a threatening letter demanding to know why I didn’t pay taxes in Maryland for 2009 even though I had a 2010 MD address. I duly sent in my tax returns from the Midwestern state. Case closed? Not quite. Soon after, my midwestern state sent me a threatening letter demanding to know why I didn’t pay their taxes in 2010 even though I had their address in 2009. I duly sent in my taxes returns and utility bills proving I had moved (twice) in Maryland. Yeesh.
What makes me laugh is the new fiscal détente between the Republicans and the Democrats established at the White House last week. The meeting for this took 70 minutes. Gee they really worked hard on that one.
If you knew how long the meeting took (it was publicized) then that isn’t the meeting where the real work took place.
The real work is done by staff and takes 100s of hours, though most of it isn’t done in meetings at all.
Seriously, what would they do for 70 minutes together? Throw talking points back and forth?
Greatest Republican folly in history: A battle of attrition between their own candidates which left the survivor too weakened to win the war…
Mitt Romney: GOP Primary Debates Were ‘Nuts,’ Networks ‘Liberals Beating The Heck Out Of Us’
The Huffington Post | By Jack Mirkinson Posted: 11/17/2012 11:05 am EST Updated: 11/17/2012 11:25 am EST
Mitt Romney slammed the Republican primary debates, and the media, in the same call to donors in which he made his infamous “gifts” comments.
Romney’s criticism of the debate process was obscured by his statements that President Obama beat him by giving “gifts” to key constituencies. But, as ABC News noted on Thursday, Romney said that the debates had hampered the GOP from the beginning of the campaign.
“We had 20 Republican debates, that was absolutely nuts,” he said. “It opened us up to gaffes and to material that could be used against us in the general, and we were fighting these debates for a year, and the incumbent president just sat back and laughed.”
…
Talk about Sore-Loserman! This guy is in complete denial! People voted for their self-interests.
He does have something of a point if you believe that people are actually influenced by the spectacle of the campaign. Newt beat up on Romney over “vulture” capitalism quite a bit during the debates. And I think one of the debates is where he pulled off his “$10,000 bet” thing.
Whether stuff like that is enough to explain the loss is an entirely different discussion. I wasn’t a swing voter, so I can’t explain whether that is the sort of thing that influences them.
‘People voted for their self-interests’
This sort of stuff follows the pro-wrestling theory of US politics. Surely, we just witnessed democracy in action; a great clash of ideas. Didn’t you see all the commotion? Did you see all those ads on TV?
What about the over 40% who didn’t vote?
Here’s a little recall about my experience. I went to the AZ state GOP convention as a delegate. The first thing the state chair told us was we were there to endorse Romney. 14 hours later, we were standing around wondering what had happened. No votes were counted. Even GOP position people supporting Ron Paul were flat out cheated of positions, ensuring that any voice of descent was squashed.
Some may remember that when Paul was drawing thousands to event after event, and Romney maybe 100, Gingrich even fewer, what happened? The mainstream media pulled all coverage of the Paul campaign. And don’t forget that Paul was leading in polls against Obama. Hmmm.
Let’s look at the other “side” of the wrestling contest; who challenged Obama for the nomination? Surely there was some objection to his term where he was to the right of George W Bush on many issues. Nope. No challenge. No choice there either. It was bombs killing brown people. Government power over individuals consolidated to levels that would have made GWB blush.
I’m not saying my candidate should have won, or who should have lost. I am saying that there was no real election. And a lot of us aren’t fooled by this charade; we know that the two guys with the most money were the only choice given to the electorate. We know why people from Wall Street always end up in powerful cabinet positions and almost never in jail. That the death merchants grow richer from wars, no matter which party “wins”.
ensuring that any voice of descent was squashed.
While you probably meant to say dissent, “descent” is what’s happening to the GOP, even if the voices are censored. As in descent into irrelevance.
Greenie wanted housing dissent kept secret
http://www.huffingtonpost.com/2010/05/03/greenspan-wanted-housing_n_560965.html
‘descent into irrelevance’
That’s just great. So instead of two meaningless choices we get only one.
‘Needless to say, the Obama administration wasted no time expressing its “full-throttled support” for the Israeli attacks…Ultimately, though, Obama had no choice but to support these attacks, which were designed, in part, to extra-judicially assassinate Hamas military leader Ahmed al-Jabari as he was driving in his car (the IDF then proudly posted the video of its hit on YouTube). How could Obama possibly have done anything else?’
‘Extra-judicial assassination - accompanied by the wanton killing of whatever civilians happen to be near the target, often including children - is a staple of the Obama presidency. That lawless tactic is one of the US president’s favorite instruments for projecting force and killing whomever he decides should have their lives ended: all in total secrecy and with no due process or oversight. There is now a virtually complete convergence between US and Israeli aggression, making US criticism of Israel impossible not only for all the usual domestic political reasons, but also out of pure self-interest: for Obama to condemn Israel’s rogue behavior would be to condemn himself.’
‘It is vital to recognize that this is a new development. The position of the US government on extra-judicial assassinations long had been consistent with the consensus view of the international community: that it is a savage and lawless weapon to be condemned regardless of claims that it is directed at “terrorists”.
‘to condemn Israeli aggression here, President Obama would need do no more than simply affirm universally recognized precepts of international law, ones that the US government has long claimed to support (even as it often violated them). That, however, is no longer possible for Obama - at least not without triggering a global laughing fit.’
http://www.guardian.co.uk/commentisfree/2012/nov/15/israel-gaza-obama-assassinations
‘Greenie wanted housing dissent kept secret’
‘As top Federal Reserve officials debated whether there was a housing bubble and what to do about it, then-Chairman Alan Greenspan argued that dissent should be kept secret so that the Fed wouldn’t lose control of the debate to people less well-informed than themselves.’
“We run the risk, by laying out the pros and cons of a particular argument, of inducing people to join in on the debate, and in this regard it is possible to lose control of a process that only we fully understand,” Greenspan said, according to the transcripts of a March 2004 meeting.’
‘The release of the transcripts comes at a bad time politically for the Federal Reserve, as it works to prevent Congress from authorizing the Government Accountability Office to audit the central bank.’
Oh yeah, what about that Fed audit? Might be kinda important. Maybe even more important than funding for Big Bird?
That’s just great. So instead of two meaningless choices we get only one.
I agree, having one party is NOT a good thing.
“Extra-judicial assassination - accompanied by the wanton killing of whatever civilians happen to be near the target, often including children - is a staple of the Obama presidency.”
I agree that this is troubling. What is the alternative?
Let countries like Yemen arrest and try these folks? Support strong dictators to control their populations?
Covert operations to extract individuals and bring them to courts in the US?
Bombing campaigns, like Israel is conducting in Gaza?
Troops on the ground , like Afghanistan?
No response - let the terrorists and freedom fighters do as they will?
Fortress America - bring all of the troops home, seal the borders and let nobody in?
It looks to me as if all of the options are bad. And we have already tried most of them.
We are in an era where small groups of people are waging war on us. Will they stop if we decide to bring all of our troops home?
Israel has been under attack since their establishment. If they don’t fight back will Palestinians stop bombing them?
‘”We run the risk, by laying out the pros and cons of a particular argument, of inducing people to join in on the debate, and in this regard it is possible to lose control of a process that only we fully understand,” Greenspan said, according to the transcripts of a March 2004 meeting.’
This is what’s so dangerous about these narcissistic scum. They actually believe they are somehow superior, and more informed, than the educated citizens who they are supposed to serve.
“We had 20 Republican debates, that was absolutely nuts,”
Correction:
“They had 20 Republican candidates who where absolutely nuts.”
Who was the single Democrat candidate? A man who, if he were president of any other country (except Israel) would be facing trial for war crimes.
And then there is this:
‘Popular Vote 2012: Narrow Lead For Obama When 13 Million Americans Chose Not to Vote’
‘The biggest vote loser was Barack Obama, who received 10 million fewer votes than 2008, but Mitt Romney also received almost 3 million fewer votes than John McCain. John McCain’s votes in 2008 would have beaten Barack Obama this time.’
http://www.policymic.com/articles/18766/popular-vote-2012-narrow-lead-for-obama-when-13-million-americans-chose-not-to-vote
A man who, if he were president of any other country (except Israel) would be facing trial for war crimes.
And so would Bush, Bush and Reagan.
You left out Clinton.
At least Jimmy Carter and his party stood for something then.
Jimmy Carter was a genuinely Christian man who ended up being reviled for it by the “born again” movement his Presidency inspired. Without the country’s new religiosity and the Babbits who led it, the Cheney/Rovians and their neocon war machine would never have come to power. Murka does love its warmakers.
That said, Petraeus is out. Maybe his drones will go with him.
I much rather have had Romney and voted for him. But I think the Republicans have themselves to blame. Is it worth loosing elections over abortion and homo marriage? Two issues about which I could not care less. Don’t like them. Then don’t have an abortion and don’t marry someone of your gender. Problem solved.
Romney did a good job keeping *his* campaign on point but he couldn’t control those morons Akin and Mourdock.
For the leave it to the state folks.
State highway safety chief has long driving record, recent accident.
Her driving record includes seven accidents, four speeding violations, two failures to stop for a police officer, one failure to stay in her lane, one driving without registration or license in possession, and one driving without wearing a seat belt
Burgess was appointed to her $87,000-a-year position in July 2007, without any background in public safety, transportation, or government administration. Her experience was in Democratic Party politics.
http://www.boston.com/news/local/massachusetts/2012/11/18/state-highway-safety-chief-has-long-driving-record-recent-accident/4HPRt0xv2Bqu3rsonuY3sJ/story.html
What a relief the federal government is efficient, honest and corruption free.
French Housing Bubble go boom.
————————————————————
Real Estate November 2012: figures for the month
November 12, 2012
2012 will remain a very bad year for real estate professionals. In this comprehensive figures on the property market in November 2012, discover the sharp decline in real estate sales in Paris and Ile-de-France, the figures very bad housing, the amount of sales that fall on the implementation updates Friggit curves , the increase in VAT in the building in 2014, the continued decline in real rates , etc..
Even in Paris, it becomes difficult to sell a property
Notaries in Paris / Ile-de-France note that even in their region very attractive it becomes difficult to sell a property . Between June and August 2012, it has sold “only” 35,000 existing homes, or 19% compared to the same period in 2011.
Despite these cheap rates, mortgage demand plunges more now. The Observatory Housing Credit CSA announces -45.8% in October 2012 compared to the same month of the previous year. This accentuates the fall of -30.5% of mortgages in the first 9 months of 2012.
After payment of the land tax in October, it’s time for the payment of the property tax in November. Whether you rent or own your residence, you must pay this tax according to your local housing situation on 1 January 2012.
You have until November 15 to pay your tax home in 2012 (until 20 midnight if paying by internet) and TV license fee that accompanies it.
The maintenance and renovation of housing more than two years are subject to reduced VAT under certain conditions. After passage of the VAT rate in the building from 5.5% to 7% in 2012, the government expects an increase in the VAT rate to 10% through.
This increase so the building and everything related to work in your home or apartment. It will be implemented from 1 January 2014. This will leave you time to carry out work before.
http://translate.google.com/translate?hl=en&ie=UTF8&prev=_t&sl=auto&tl=en&u=http://www.immobilier-danger.com/Immobilier-novembre-2012-les-573.html
Whether you rent or own your residence, you must pay this tax according to your local housing situation on 1 January 2012.
That would really shake things up. Having renters pay property taxes.
“That would really shake things up. Having renters pay property taxes.”
Commercial renters have been doing it: Google up “triple net lease” sometime.
Jethro plays anything
http://www.youtube.com/watch?v=yAXl4kYZyoA - 184k -
Even this?
(keyboard alert for prof, FPSS)
http://www.youtube.com/watch?v=hpJ6anurfuw
OK
There are some things that Jethro won`t play. I drove acrosss the state last year and there was a dj named Bob, his thing was “Bob plays anything” Bob played a lot of good stuff. But Bob didn`t play anything like that so I guess I`ll have to change that line.
How ObamaCare will keep unemployment high and these people will never be able to afford a house (or housing prices need to come down another 60%)
————————————–
The 49ers
NY Post | 11/18/12 | MICHAEL TANNER
Under ObamaCare, employers with 50 or more full-time workers must provide health insurance for all their workers, paying at least 65% of the cost of a family policy or 85% of the cost of an individual plan. Moreover, the insurance must meet the federal government’s requirements in terms of what benefits are included, meaning that many businesses that offer insurance to their workers today will have to change to new, more expensive plans.
ObamaCare’s rules make expansion expensive, particularly for the 500,000 US businesses that have fewer than 100 employees.
Suppose that a firm with 49 employees does not provide health benefits. Hiring one more worker will trigger the mandate. The company would now have to provide insurance coverage to all 50 workers or pay a tax penalty.
Under ObamaCare, employers with 50 or more full-time workers must provide health insurance for all their workers, paying at least 65% of the cost of a family policy or 85% of the cost of an individual plan.
There are consequences to the right-wing’s 40 year dogmatic battle against single-payer health-care. What you describe above is one of the consequences.
Your side owns it.
LOL. This was Obama’s plan. This is an area where he differed from Hillary during the primaries…he thought the insurance companies were too big a part of the US Healthcare system to be left out of a solution, Hillary supported a single payer.
At the end of the day, Obama could have passed what he wanted (and did).
So, the Democrats chose Obama who wanted insurance companies as part of the solution, leaving Clinton out, who wanted single payer. And now you blame Republicans?
This problem was easy to avoid. Make the number of people you need to insure equal to your total number of full-time employees MINUS 50. There, I fixed it.
Still doesn’t solve the problem of making all these full-time people part time in order to get out of the obligation…
LOL. This was Obama’s plan.
Think harder. Obama’s plan was a compromise largely influenced by the right-wing’s 40 year dogmatic battle against single-payer health-care.
At the end of the day, Obama could have passed what he wanted (and did).
I don’t think Obamacare is what Obama “wanted”. I think it is the compromise that he could get in light of so many Americans being influenced by the right-wing’s 40 year dogmatic battle against universal health-care.
Obama specifically campaigned on this differently than Hillary Clinton. The DEMOCRATS chose Obama over Hillary in the primary.
Don’t blame it on the dogma of the Republicans, when the Democrats made the choice.
Info from a Hostess union worker:
I’m going to commit a board faux pax and quote something from the Great Orange Liberal Website. This particular dude was part of the bakers union at Hostess, and has some real information:
1999: Hostess sent out a letter that they were doing great, most productive quarter. A few weeks later, they got another letter that oops it the good news was an accounting mistake, they were doing miserably. Strangely, the executives had sold their stock just in time.
2002-2011: Six CEOs come and go. Each time, the company is worse off, but the CEOs leave with huge pay and bonuses.
2004-2009: Hostess declares BK and receives funding from private equity. In 2005, Dude was making good money ($48K/year) plus benefits, in Kansas. Baker’s Union gave some concessions, but the company still contributed $3/hour to their own pensions. [it was right around this time that private equity stepped in to "save" them.]
2011: As part of the concessions, Dude now made $34K/year, but still contributed to his pension. That’s right, that’s a 29% pay CUT. Then CEO’s said that the company needed to “borrow” that $3/hour pension to make the company profitable. [it was right at this time that the CEO's gave themselves the pre-BK raises, as was discussed on HBB last week.]
2012: Pre-BK final offer to the union, and I quote:
1) 8% hourly pay cut in year 1 with additional cuts totaling 27% over 5 years. Currently, I make $16.12 an hour at TOP rate of pay in the bakery. I would drop to $11.26 in 5 years.
2) They get to keep our $3+ an hour forever.
3) Doubling of weekly insurance premium.
4) Lowering of overall quality of insurance plan.
5) TOTAL withdrawal from ALL pensions. If you don’t have it now then you never will.
Remember how I said I made $48,000 in 2005 and $34,000 last year? I would make $25,000 in 5 years if I took their offer. It will be hard to replace the job I had, but it will be easy to replace the job they were trying to give me.”
I’ll link if someone asks, but it should be easy enough to google for the source.
——————–
The Liberal Dude’s union rejected the offer, and why not? The workers knew the company was going to re-BK an lay-them off anyway. Why bother to stay when they could get a $25K lucky ducky McJob somewhere else.
In related, news, per Bloomibergi, the owner of Pabst is interested in buying the brands. Twinkies are not going to disappear. I suspect those Twinkies will be made by minimum wage lucky duckies.
Twice on HBB, Lip(?) told me that the workers should be grateful to have a job to feed their families, and that “this is the way of mankind.” It is the way of third world countries, and the way of vulture capitalism. Easy to boast, until it happens to you.
Sorry, but the global mean wage is $2/hr.
So getting a $25K lucky ducky McJob somewhere else will only become less likely in time.
Wages must be forced down. Either you accept that, or it will be done to you anyway. And if that sort of force is used, true, it won’t come immediately, but it will come, and it’s going to hurt even more when it does (since you won’t have done anything to prepare for it, so you’ll only be deeper in debt).
I get into these sort of arguments all the time. Keeping your job is better than no job. The Hostess rank and file will have to learn this the hard way… after all, they’ve known this was coming for years. This is the future, to them. Consequences have finally arrived.
There’s an excellent article today about burger-making robots.
The boast is that you can make Five Guy’s quality burgers at McD prices or even better burgers at Five Guy’s prices.
Guess again where wages are going.
Automation is the future and that has been a fact since the Industrial Revolution.
There’s an excellent article today about burger-making robots.
Who’s gonna buy those burgers if everyone is making $2/hr?
It sounds to me like “capitalism” has an appointment with its own demise.
They aren’t going to be making $2 an hour. The people running and fixing the machines will be making a bit more than that, but they will be able to do the production that used to require dozens or hundreds of workers.
You still have the same issue of who will buy the burgers, but the problem will be “customers” with no income, not crappy income.
What about the CEO raises, though? It seems like the justification for “borrowing” their $3/hour and lowering their salaries was only to give themselves the money, not to actually help the company. It’s not that I think the pay should be equal at all of CEO’s and the workers, but are you talking about the CEO salaries as well as the workers salaries?
While I agree that having a job is better than no job, that can become an excuse for employers to do whatever they want to you, and the populous will say you should be grateful. I know many companies that commit wage/labor violations, but employees now do not speak out in fear of losing the only job they are likely to get anytime soon.
“It’s a private club and you aren’t a member.”
I don’t think I’d want to be a member…
Then you get to do without.
While I agree that having a job is better than no job, that can become an excuse for employers to do whatever they want to you
I see that you understand the business plan of 99% of companies in the USA.
Wages must be forced down. Either you accept that, or it will be done to you anyway.
That’s fine, will we also get lower prices? I didn’t think so.
So who’s gonna buy the stuff made by cheap labor? No customers means no business. And no middle class means no customers. It’s the inevitable outcome of the race to the bottom. Factories around the world will have no customers once everyone is making $2/hr.
Which mean it isn’t going to happen.
What you described may be the direction of the trend but that doesn’t mean the trend will arrive at the destination.
Sh1t happens.
I agree that we won’t arrive at $2/hr. But if wages fall enough, people will either do without, or buy a lot less frequently.
Cars: A lot more people will be driving them into the ground. End result: fewer new car sales and lower median prices as people opt for smaller, less luxurious and overall cheaper models than in the past.
Houses: need I say anything?
Consumer goods: I’m typing at a 5 year old PC, a clunker that runs Windows Vista. I don’t plan on replacing it anytime soon.
As wages continue to drop, the consumer portion of the economy will continue to contract. And when the government ends its deficit spending … look out below!
Sounds a bit deflationary, no?
Sh1t happens.
Yet the world has never been more productive. We should be awash in real wealth, not poverty. Somehow, its winding up in just a few hands.
I’m sure the Davos crowd thinks they can manage this, grabbing the greatest amount of wealth they can without triggering a global revolt. History however, documents that greed always gets the best of them, and that they always push things too far.
Much of the middle class prespent their future productivity using debt.
Sounds a bit deflationary, no?
Except that other than with houses, it hasn’t happened. Maybe if the FedGov cuts spending (not likely to happen) we might see deflation in other areas. Or not. Lack of demand for new cars hasn’t pushed prices down.
And what this prespent future prosperity created was a false prosperity - a prosperity borrowed from the future and financed by the debt the middle class took on.
When the borrowing stops then the false prosperity - the borrowed prosperity - comes to a halt and then this false prosperity (gasp) begins to reverses itself.
And here we are.
As long as there is a need to drive to the job you have, people will buy cars. Mass transit doesn’t seem to be a direction we are going. In fact, when times are tough mass transit is one of the first items cities cut.
In whatever way it happens, payoff / default / BK, the debt needs to disapear before consumption can continue. And after difficult times people may not consume as much or take on as much debt.
Although the young now start out with education debt. Or parents get loans for their kids educations and end up with little for retirement.
Guess the debt must continue for our economic system to continue.
“In whatever way it happens, payoff / default / BK, the debt needs to dispappear before consumption can continue.”
“payoff” means somebody gets paid what they are owed.
“Default / BK” means they don’t.
If you are on the right side of the payoff debt then you have it made. If you are on the wrong side of the default / BK debt then you are screwed.
This should be a no-brainer but for some reason it isn’t.
Got Treasuries?
“As long as there is a need to drive to the job you have, people will buy cars.”
There are other alternatives - bicycles, motorcycles, mopeds.
Sorry, but the global mean wage is $2/hr.
What’s the global mean wage for CEOs of bakeries that make chemical-laden junk food?
Probably way less than $2.5 million.
It is the CEOs that have to take a pay cut. They can either take less to pay their employees more, so that they will still have customers going forward, or they can pay more in taxes to buy more EBT cards, which won’t give them more customers.
“Consequences have finally arrived.”
Consequences of what?
“The Hostess rank and file will have to learn this the hard way…” 2012, ex CEO of Hostess with 20 million dollars in the bank.
Thanks for posting this. It seems to explain what appears to be the wholly irrational behavior of the 18,000 who lose their jobs.
Krispy Kreme did it!!!
It will hit some jobs in the SF Bay Area as well. Not a great time for unskilled workers to be losing jobs here.
But this was the fundamental problem:
Revenue
US$2.798 billion (2008)
Net income
-US$143.68million (2008)
Total equity
-US$461.71million (2008)
Those last two numbers are negative. And that negative run rate of over five percent of revenue was *after* trying Chapter 11 reorganization from 2004 - 2009. Creative destruction is taking place - you have to kill off uncompetitive entities and use the resources in newer more competitive entities.
One snipet:
“With the merger, Interstate now held two major national bread divisions – Butternut and Wonder Bread. The two divisions operated with different cultures: Butternut was unregimented and each bakery was a self-contained profit center; Wonder Bread was very “procedural and by-the-book.” This caused some problems early on. In both cultures, snack cakes were more profitable due to economy of scale and logistics. When extended-shelf-life enzymes were developed for bread, the hope was to convert the system of many small inefficient bakeries into an efficient network of a relatively few giant bakeries like their snack cakes operation. However, the recipe using the new enzymes caused the bread to have a different taste and texture,[14] and other market forces like a resurrection of the Atkins diet and competitor Krispy Kreme doughnuts affected pricing and sales volume.”
Bottom line Krispy Kreme did it!
Also note this will have reverberations to other firms. Hostess Brands, Inc., was a contributor to Multiemployer Pension Plans. Hostess may be gone but those Multiemployer Pension Plans still exist so other firms like Kraft may need to step up to the plate and fill the void. The devil is in the details.
It is the way of third world countries, and the way of vulture capitalism.
American “capitalism” is eating America alive and in real time.
“American “capitalism” is eating America alive and in real time.”
American’s are eating ***Krispy Kreme*** alive and in real time.
Quick Search of the KRISPY KREME DOUGHNUTS INC 10Q filing on sec.gov Edgar Database:
Revenue:
$403,217,000
Net income
+$166,269,000
Total equity
+$249,126,000
Now that is what a healthy company looks like. 40% net income from revenue and yes those are all positive numbers. That’s better than Apple!
And that is in the middle of the great recession. And that’s just one new competitor for just the donuts.
Imagine all the “whole grain” breads that are being made by competitors that are selling for multiples of the price of a loaf of white sticky Wonder Bread by Hostess!
This is creative destruction. If you don’t innovate someone else will. They are called entrepreneurs. All those sales and jobs didn’t go to money and job heaven. They went to stronger players with better products.
Frankly I think most Americans would rather eat better quality food. I can’t even remember the last time I ate “white bread” like Wonder! The thought of it - is like OoooOh Gross! Any “wonder” why Hostess bit the dust? I “wonder” - do you reach for wonder bread in your supermarket?
I didn’t think so!
Next!
And Krispy is hiring!
You’ll be Rewarded On Our Team
We stake our reputation on the quality of our products and the quality of our people. To get the best people, we offer one of the most competitive packages for full-time employees in the industry, which includes:
Medical Insurance
Dental Insurance
Life Insurance
Disability Insurance
401(k) Savings Plan
Training
Paid Vacation
Advancement Opportunities
Educational Assistance
Holiday Pay
Personal Days
Smoke-free Work Environment
Flexible Spending Account
Relocation Assistance
Adoption Assistance
Wellness Program
Recognition Program
Service Awards
Direct Deposit
Discounted Products
And perhaps most importantly, Krispy Kreme provides a fun and inspiring work environment, and did we mention—lots of delicious doughnuts to eat!
And they got management training *with* the CEO personally.
Assistant managers earn roughly $30,000 a year. Salary options for managers may reach excesses of $60,000 a year.
How hard is it to become a “manager” of a joint like this? A high school kid could do it.
It does say on the Krispy Kreme website that a college degree is preferred.
25K a year plus bennies is a princely sum to the young minimum wage worker trying to move out of Mom’s. And it’s a damd sight better than nothing, which is what Dude can look forward to now. And yes, the CEOs are gonna take it in the wallet over the next generation’s worth of tax reforms, and they’ll be screaming bloody murder, too.
Seriously, people, you bake and distribute Twinkies! This is hardly critical infrastructure we’re talking about. The party is over, the balloons deflate, de quelle bummer. Why can Americans not understand this?
Maker of medical-marijuana dispensing Medbox MDBX shares surged 3,000% this week — from roughly $4 Monday to $215 Thursday –
Why is this relevant? With two states making MJ legal this month and many more making it legal for “medical” use - sales of Donuts and snake foods are going to SURGE!!!!
BOOM!
Krispy Cream is going to be killing it!
Jobs for everyone!
It may not be critical infrastructure, but it should fall into the realm of “affordable luxuries” that people hold on to when they can’t afford nice sneakers or new cars or vacations. You and I may prefer not to touch the stuff, but that doesn’t mean it isn’t what some people want.
I would really like to see the details of the parachute packages the execs got when their incomes when so far up.
That’s true Polly but food and snakes have never been cheaper in U.S. history compared to wages. I think food preferences are just changing. We have demographics shift going on. People coming from Mexico have never seen a Twinke. But Mexican sweets like Churro are experiencing record sales. And younger people in general are looking for low card snacks. It used to be in many towns all you could find was Wonder Bread in smaller stores. Now there is shelves of competing products. I check in with a lot of local business owners I know and Oscar who is in a Mexican wholesale food business just keep adding more square footage every year and his warehouses are packaged full of workers.
I decided years ago that if I was going to get fat, it ought to be on something better than Twinkies and Whoppers.
Natty Ice?
“…food and snakes have never been cheaper in U.S. history…”
It would be awful to have to buy now or be priced out forever.
(lol!!!)
Your comments always make me laugh. I’d take 25k a year to bake Twinkies…
25K a year plus bennies is a princely sum to the young minimum wage worker trying to move out of Mom’s.
Maybe in Topeka, KS. But in most metro areas, it’s a poverty wage.
About those $25K jobz.
My favorite child recently drove cross country to CA (gaa!) to visit friends. Although he went through Parris Island, for some reason he worked and made friends mostly with Marines from California. He said he was going to look around for jobs while he was there. He found a job and an apartment in Long Beach.
Took him five weeks all told. He’s making $25K.
He’s pleased as punch, literally kvelling. He likes the job, which is not a cubicle job. He says he is with good people, from whom he’s learning a lot.
I’m profoundly grateful that he is happy, and that he has the satisfaction of having landed something on the strength of his own effort. So different from the horrid four months of fruitless searching at the front end of the Great Recession, when I could do nothing to help him, and he enlisted in lieu of sinking into depression.
Nevertheless, I’m also in mourning that this kid, who is like the sun after a cold hard winter, is on the other side of the continent.
He’s the one who is both a scientist and an artist. Everybody else always pegged him as a left coast type. I guess I was the only one who was surprised.
Point being that he got a $25K job and he is thrilled. With zero debt, it works out - just.
Ditto my favorite child, Jane. He makes the same 25K doing creative work he absolutely loves and excels at a couple of hours away in SoCal. No debt, 5 figure savings, lives at Dad’s place in exchange for keeping the lightbulbs changed and the refrigerator stocked.
And he’s happy as a clam.
My heart broke when he went back East to school a few years back, but it was a necessary (and fearsomely expensive) break from the admitted non-reality of his upbringing, and he did pick up a wonderfully useless high-end classics/history degree– which actually serves him very well now in his work.
Fortunately our circadian rhythms overlap, so now that he’s back on the left coast, we generally get together online in the wee small hours every night on AIM (instant message) critiquing whatever the other is writing and snarking on the day’s events. It’s not exactly “dinner at Mom’s”, but it’s a surprisingly cool way to stay in touch.
Be there online when he is. You’ll figure out the routine, and meet a whole new kid.
ahansen, thanks sincerely for the insight. I fear the online thing is not going to work much. We’re both anachronisms in this online age - him because he’s a man of action and me because I’ve got my nose buried in problem sets.
Oxide as I have posted many times before the middle class life style of the 1950s & 1960s was a historical / economic anomaly. There is great downward pressure on wages. Sorry for the workers but nobody is entitled to a job making X so they can live a certain way.
Why not, if they are generating the value with their labor? Why should they get the crumbs? This attitude is what gives fuel to real Marxists.
Oxide as I have posted many times before the middle class life style of the 1950s & 1960s was a historical / economic anomaly.
What was not anomaly was each American generation doing better than the prior generation. This has only recently changed.
“2002-2011: Six CEOs come and go. Each time, the company is worse off, but the CEOs leave with huge pay and bonuses.”
I’m curious, how do you think they otherwise would attract someone be the CEO (including all the liability) of a company on the ropes? I’m assuming big guaranteed payments independent of success would be in the mix…
So, overall, it sounds like the company was on its way to failure…any other read on the situation?
Jethro plays anything
http://www.youtube.com/watch?v=ebPsiEBXsHs - 204k -
I’m noticing a noticeable smattering of existing properties adding barns or animal sheds around me. Food security issues accelerating?
Cheaper to raise your own food? Cost of feed has gone up. A single steer may cost more to raise than buying meat at the store. No economy of scale.
Although home raised is much, much better for you.
I don’t think it’s necessarily about eating more cheaply. I think it’s more likely about eating food that won’t make you sick. I know Michael Pollen’s Omnivore’s Dilemma was a big hit around here and I’m pretty sure when he came to speak, it was a sell out crowd.
http://www.amazon.com/s/?ie=UTF8&keywords=omnivore%27s+dilemna&tag=googhydr-20&index=aps&hvadid=4308639017&hvpos=1t1&hvexid=&hvnetw=s&hvrand=1618354822348022629&hvpone=&hvptwo=&hvqmt=b&ref=pd_sl_1sfyyxz03o_b
For anyone that hasn’t read it, it does really make you think about what you’re ingesting, especially if you worry about many of the diseases that appear to have spiked in occurrence today.
snowgirl,
In my experience, adding barns, sheds, coops, etc. is more a sign of relative wealth and optimism than of desperation. At least you know your neighbors are planning to stick it out for a season or two and that their stock will be fed and cared for.
Jethro plays anything
http://www.youtube.com/watch?v=QCQTr8ZYdhg - 218k -
Screech!
“We’re running out of old white men!!!”
“The end of the Republican Party is neigh!”
I see this posted so often here I thought it might be appropriate to post a little history for some of the amnesiac minds. I’ve constructed some data for you all covering the real “blow-out” elections of the last 200 year.
Below I’m posting:
The year, candid A (party A) Electoral votes candid B (party B) Electoral votes
Ratio of states taken by each candidate.
First let’s look at the results of 2012:
2012 Barack Obama (Democratic) – 332 Mitt Romney (Republican) – 206
States: 26+ DC : 24
332 to 206 electoral votes and 26 to 24 states with DC going to Obama.
Does this mean the end is near? Let’s take a look…
How about 1984? Reagan (R) took 49 states and 525 electoral votes versus just *one* state plus DC and 13 electoral votes for Mondale (D). And that was Mondale’s *home* state.
How about 1972? Nixon (R) took 49 states and 520 electoral votes versus just *one* state (MA) plus DC and 17 electoral votes for McGovern (D).
How about 1936? Roosevelt (D) took 38 states and 523 electoral votes versus just ten states and *8* electoral votes for Landon (R).
Here are the rest of the blow-out elections. I think based on these data it may be premature for the Republicans to turn out the lights just yet:
1988 George H. W. Bush (Republican) – 426 Michael Dukakis (Democratic) – 111
40 : 10 + DC States
1984 Ronald Reagan (Republican) – 525 Walter Mondale (Democratic) – 13
49: 1 +DC
1980 Ronald Reagan (Republican) – 489 Jimmy Carter (Democratic) – 49
44: 6+ DC
1972 Richard Nixon (Republican) – 520 George McGovern (Democratic) – 17
49: 1 + DC
1964 Lyndon B. Johnson (Democratic) – 486 Barry Goldwater (Republican) – 52
44 + DC : 6
1936 Franklin D. Roosevelt (Democratic) – 523 Alf Landon (Republican) – 8
38: 10
1872 Ulysses S. Grant (Republican) – 286 Thomas A. Hendricks (Democratic) – 42
31 : 6
Although those 6 states were split because the candidate Horace Greeley (liberal Republican) died and was awarded 3 electoral votes posthumously which were later disallowed.
1864 Abraham Lincoln (National Union) – 212 George B. McClellan (Democratic) – 21
22 : 3
1852 Franklin Pierce (Democratic) – 254 Winfield Scott (Whig) – 42
1832 Andrew Jackson (Democratic) – 219 Henry Clay (National Republican) – 49
1816 James Monroe (Democratic-Republican) – 183 Rufus King (Federalist) – 34
1804 Thomas Jefferson (Democratic-Republican) – 162 Charles Cotesworth Pinckney (Federalist) – 14
I know, I know “We’re running out of old white men!!!”
The moral is political parties adapt over time. They never have been and never will be static. They will evolve over time to capture changes in popular sentiment.
“We’re running out of old white men!!!”
I know.
Not to worry there are still plenty of young white men, but they don`t want to work. We’re running out of old black men too! Not to worry there are still plenty of young black men, but they don`t want to work either. Better keep that border open they want to work.
“We’re running out of old white men!!!”
You are. The Republicans have won the Presidential popular vote only one other time since 1988. 1988!
The Republicans lost the popular vote in 1992, 1996, 2000, 2008 and 2012. Good God.
Republicans better figure out how to gerrymander the electoral college.
Yes, and nearly 50/50 split since then. None of the elections since 1988 compare to the blow-outs I posted above. And the democratic party went through longer streaks sometimes winning as little as one state! And that was after they got a huge landslide with FDR. Public opinion can turn on a dime parties shift platforms to gain votes back. Democrats lost almost everything for decades. And they came back strong. They just had to shift their platform to adapt.
Please somebody fix this problem. How much does it cost to buy some rain? Weather events have sliced a little less than 1% off the US GDP in the last 12 months.
Low Mississippi River water levels may halt barges:
“This could be a major, major impact at crisis level,” said Debra Colbert, senior vice president of the Waterways Council, a public policy organization representing ports and shipping companies. “It is an economic crisis that is going to ripple across the nation at a time when we’re trying to focus on recovery.”
http://www.daily-chronicle.com/2012/11/17/low-mississippi-river-water-levels-may-halt-barges/aob2kgn/
The good news is that as folks run out of money to buy stuff, there will be less demand for shipping it.
I took a walk on the beach of Lake Ontario today. The water is pretty low in the eastern drainage too.
I did enjoy the solitude, until a border patrol agent in a black pickup roared past me. No boundaries.
ahansen, being the Pollyanna around here is my niche, thank you very much.*
*(Sniffs in snippy fashion).
Hostess worker reacts to closure
http://www.usatoday.com/media/cinematic/video/1708899/
That guy is amazing.
He must have a union retirement plan since he doesn’t appear to be too upset; the union bench will likely have another job lined up. His teeth look pretty good too for a 21st century American laborer. I wish him the best of luck.
He said the retirement is gone. He gave a hint that he’s not actually a Twinkster Union member, but was supporting their strike.
I am surprised that the managers got away with giving themselves huge raises before going the BK. The BK judge should have caught that and clawed them back, IMO. Sounds like fraud to me.
Considering jobs today are all going face to face even by Skype…shouldn’t ohbamacare cover some of this, call it the soft skills in job training???
Bad teeth at Starbucks?…..next!
His teeth look pretty good
Now lets see what side Obewanna is on…….or Sharpton, Pelosi Waters……
No you won’t. The Twinksters didn’t have a super pac to stuff his coffers. It’s a non issue.