Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
Post off-topic ideas, links, and Craigslist finds here. And check out Chomp, Chomp, Chomp by a regular poster!
Posted By: Ben Jones @ 12:52 am
So what’s the catch? Even with a $1718/month HOA fee, it’s a lot cheaper than a comparable hotel room with room service.
“Laguna Woods condo selling for $1″
“…The studio on the fourth floor of The Towers complex enjoys western views and is “just the right size.” It has a Murphy bed that pulls down at night and vanishes by day, a kitchenette with a refrigerator and a walk-in closet. “Gourmet” dinners, maid service and utilities are included.
“So what’s the catch?”
The catch is you can’t just walk away.
A comparable hotel with room service offers the option of walking away anytime you feel like it. Not so with this condo.
(Or a marriage.)
The number of people who will turn to food banks for sustenance is expected to double this Christmas, as a new report warns that millions more families face a financial “precipice” due to high personal debts, flatlining wages and future interest rate rises.
With three new food banks opening every week in the UK, the charity that oversees Britain’s 292 emergency outlets, the Trussell Trust, says it expects to feed 15,000 people over the Christmas fortnight alone, almost double the number last Christmas.
At the same time, a study published by the Resolution Foundation, an independent thinktank, says millions of households with low to middle incomes will be pushed close to the edge if they are unable to reduce their debts, including mortgages, before the cost of borrowing returns to more normal levels
Middle income families can’t buy food because of debt…
“Middle income families can’t buy food because of debt…”
+1 The house eats first!
Or maybe I would be trying for a job in India now. More than 1 million jobs coming to India in 2013.
India does not have work visas like the US.
Unlike us, other countries jealously protect their job base. Offshoring and foreigners are not welcome nor cheered.
Other countries actually care about their homegrown citizens. The USA not so much.
“The house eats first.”
Lol. Reminds me of the term “will eat you out of house and home”.
The debt eats first. The debt will eat you out of house and home.
That’s truly inspirational.
The world misses you, Freddie Mercury.
If you pay current inflated asking prices for housing, you’re going to lose a lot of money. a LOT of money.
if you factor in free rent for 3-4 years I think there is an opportunity to make money if you can buy for zero down.
Zero down / zero rent for 3-4 years?
Where do I sign up?
usda rural loan program of course. If prices dont go your way quit paying and gather that free rent fro a few years like everyone else.
USDA will garnish your wages.
What wages? We are going into a barter system. After all, when the FED finishes destroying the value of paper money, as they will eventually, what are you going to use for trade?
Look at the current situation. The FED has to buy treasury bonds or they wouldn’t be able to sell them. That tells you that government paper is worthless, at least against what is the perceived return, which is Zero.
Let me give you $1000 today in return of $1020 ten years from now. Oh, and you need to pay tax on the “earnings”.
Big advantage of barter: NO SALES TAXES.
And the disadvantage: Double-coincidence of wants. But maybe if you are a Mormon or member of another large network, or you use barter.com or similar approach to reduce search costs, this is no matter.
And so will any creditor/lender.
Not only will you be responsible for the difference plus interest, you’ll have nothing to show for it as you will be evicted.
Someone needs to tell Jethro to chill, then. The deadbeats will get theirs, apparently.
With pickles and onions?
I see you post this a lot. You think people “buying” houses means they are ‘paying’ for them.
You have not been paying attention.
IF you buy a house, you are a victim of corporate greed and fraud and you don’t really have to pay for it. You just move in.
Rent free buying is the “new” American dream.
Buy a house, and retire.
The house pays you. how can you LOSE money???
A house of your own is the new American entitlement OPM pays for. Shame on America.
It’s also HUD’s stealthy newfangled “screw the middle class” policy measure, forcing them to federally guarantee low-downpayment subprime loans to future rent-free homeowners.
Republican rifts mean more gridlock, obstacles for Obama
Splits among House Republicans mean more gridlock — and more roadblocks for President Obama’s agenda.
By Paul West and David Lauter, Washington Bureau
December 22, 2012, 3:16 p.m.
WASHINGTON — In the days immediately after President Obama’s reelection victory, White House officials hoped that in a second term he might have better relations with congressional Republicans. The “fever will break,” more than one Obama aide forecast.
The last several days have demonstrated the opposite. Washington remains caught in a partisan stalemate on the budget, seems headed toward another on gun control and perhaps one on immigration policy as well.
That gridlock could inflict significant damage to the Republican Party. But Obama’s ability to manage an ambitious agenda in his new term also hangs in the balance.
Stalemates in Congress “may not affect his popularity all that much, but it will affect his ability to govern, if you define ability to govern as your ability to move your policy agenda forward,” said Bill Galston, a former domestic policy advisor to President Clinton.
For Republicans, the events of the last several days signal how the orthodoxy of the tea party and other conservatives dominates the party, much to the frustration of the few remaining moderates, who want to broaden the GOP’s appeal.
“We’re on the wrong side of fixing the economy and on the wrong side of where the country is going in dealing with gun violence and on comprehensive immigration reform,” said John Weaver, who advised Jon Huntsman Jr.’s campaign for the 2012 Republican presidential nomination and helped oversee 2008 GOP nominee John McCain’s presidential run.
“At this rate, we’re going to be able to put the entire party on a Carnival cruise ship and sail around the Caribbean,” he said.
but it will affect his ability to govern ??
Its their fall back position…”We will Govern from the House”….My Way or No Way…I actually think that some of them want another recession…
From what I understand, Obama has just as hard a time getting the left to go along with entitlement reform as Boehner has in getting the right to go along with tax increases (I gathered this from Woodward’s book). It certainly explains Obama’s plan to “tax now, complete entitlement reform later”.
It certainly isn’t that they need more time to study it…they’ve been studying ways to reform entitlements since the “National Commission on Fiscal Responsibility and Reform” in 2010 (what a joke of a name).
Hitting the train station at 100mph, it is….$20T in debt by 2016.
I Agree RW….I have no lost love for the left…To many people riding in the wagon over there…Until there is pain on both the far left and the far right I just don’t think anything will get done…
So, off the Cliff we should go…That will wake up a few on the far right and the far left with some entitlement cuts and definitely the tax payers across the board…Its not a solution but it may get some attention…
Then, we can run into the wall on the budget ceiling and the potential for whole thing to come un-wound…
Maybe, at that point a more grand plan can be achieved for the future prosperity of this country…
We can hope.
I just hate the BS that I keep hearing…can’t raise revenues by cutting loopholes, etc.
Even though that was exactly what the Simpson/Bowles commission does.
What they really mean to say is that we can’t raise revenues if we are only targeting the top 2% by cutting loopholes alone. Unfortunately, there simply aren’t enough rich folks to tax to solve the problem. Whether it’s $1.6T over 10 years, or $800B over 10 years, we’re talking about 8-15% of the deficit with that tax increase.
We will hit the station at only 90mph, if people think there won’t be pain across the board to solve this mess.
Recessions are good for the 1% for a number of reasons:
1) They reduce labor costs and increase the pool of highly qualified potential hires.
2) They offer the opportunity for wealthy folks to acquire hordes of assets at fire-sale prices while the 99% are at best barely able to keep their heads above water.
3) They create a combination of low asset returns and high present value of future pension liabilities which makes an easy case for cutting back on corporate and civic pension programs.
4) They create the perfect conditions to bust unions.
5) When the economy finally recovers, and the rest of the citizenry starts feeling wealthy enough to resume investing in the stock market, the 1% club will enjoy reaping large capital gains on assets they purchased when everyone else was sidelined.
Where is the downside?
are these recessions created on purpose?
You have to wonder. For instance, if you paid attention in Fall 2008, you probably noticed how George W. Bush, Ben Bernanke and Henry Paulson all warned everyone that a crash was imminent.
If the those “public service announcements” were not meant to cause a recession, then what purpose did they serve?
“Give me control of a nation’s money and I care not who makes it’s laws.”– Mayer Amschel Bauer Rothschild
He clearly foresaw our campaign finance system.
He clearly foresaw our campaign finance federal reserve system.
Rioters may be able to breach the gates of your estate.
The market under Clinton loved gridlock. I hope it’s the same the next four years. I could then retire and start my business in silicon desert (Chandler, AZ).
I hope it’s the same the next four years. I could then retire and start my business in silicon desert ??
Kind of a self-centered position don’t you think Bill ?? Besides, you will never get to your “Dream Land” if the entire country goes down…
“if the entire country goes down…”
Which it may do, but it won’t be because of congressional/administration gridlock. Gridlock is generally healthy for the people, IMO. The less these turds can do, the better.
We can’t borrow our way to prosperity Palmy no matter what Dick Cheney says…
Self-centered is not a vice in an objectivist point of view.
“I could then retire and start my business in silicon desert (Chandler, AZ).”
I want a ride in the “Bill in Chandler” 787 Dreamliner.
I could then retire and start my business in silicon desert (Chandler, AZ).
Yesterday it was Alaska. Are you a fantasist, Bill?
Wait, I know your political and economic views. You are.
Posted on Sunday, 12.23.12
Lieberman fears country may go over `fiscal cliff’
The Associated Press
WASHINGTON — Sen. Joe Lieberman says he feels “it’s more likely than not” that the country will go over the “fiscal cliff” now that House anti-tax rebels rejected Speaker John Boehner’s plan because it would raise rates on million-dollar earners.
Lieberman says going over the cliff “will be the most colossal consequential act of congressional irresponsibility in a long time, maybe ever in American history.”
The Connecticut independent tells CNN’s “State of the Union” that taxes will go up for most everyone, programs will be cut and the country probably will return to recession.
Lieberman says Senate Majority Leader Harry Reid and GOP leader Mitch McConnell “have the ability to put this together again and pass something” although it won’t be the “grand bargain” to solve all issues over the long term.
Hyperbole to the max. Nasty old warmongering blowhard.
Nasty old warmongering blowhard ??
I agree…Glad he is leaving…Wish he would take McCain with him along with a few others…
“….Glad he is leaving…”
Lucky for him he has two passports. ;_)
I want to go over the “fiscal cliff.” I’ve always liked rides, and I want try it out.
The upside is that lots of “smartest guys in the room” who “knew” that the Congress and the Prez would “never” go over the fiscal cliff will lose billions in gambling money. Further, I’m pretty sure there is no political will left to bail out Wall Street’s greatest fools yet again, even if “nobody could have seen it coming.”
Billions depart bonds for stocks
Over $4b leave bonds for equity shares as risk appetite improves
Published: 16:23 December 23, 2012
New York: Investors pulled $4.1 billion (Dh15 billion) out of bond funds in the third week of December, the most in a year and a half, and put more than $5.5 billion into equity funds, nurturing hopes that appetite for risk is returning despite any fears of a looming US fiscal cliff.
Institutional investors have taken hundreds of billions of dollars out of stock market funds since the financial crisis and piled into the safety of fixed income, pushing yields of government and corporate bonds to record lows.
The only equity funds to have seen some inflows in recent months have been vehicles that specialise in stocks that pay high dividends, but they have lost momentum in December, according to EPFR Global, a provider of data on fund flows.
In contrast, US and Europe-focused stock market funds have recently enjoyed a resurgence of investor faith, as the possibility of the US going over the fiscal cliff of automatic tax rises and spending cuts failed to dent optimism engendered by the easing of the Eurozone crisis, or surmount the fact that the buoyant bond returns of the past year are unlikely to be replicated in 2013.
“It’s a sad moment when we bond investors think equities are actually a better long-term bet, but we reached that moment a long time ago,” said Jim Cielinski, head of fixed income at Threadneedle, a London-based asset manager.
Interesting. I have a bet with a colleague at work. I say the S&P 500 index will finish lower at the close on December 31 than on December 1. We made that bet the first Monday this month.
I used past performance in December 1986 before the last capital gain tax increase as my reason. He used the statistical “Santa Claus rally.”
I was expecting a big sell off by now. It’s turned unlike 1986 but either of us could still win.
The wager is a couple dozen Kings Hawaiian pastries.
If I lose my bet it would be good for my own bias toward equities. If I win, I expect a big sell off this week. Think about it: if you were a one percenter and your capital gains taxes will increase 58% in two weeks on gains of stocks you bought in 2009 would you take some big profits and sit on $10s of millions in cash for several years? I would. The thugernment is constitutionally bound to not steal your principle. They can steal your income though. Dividend stocks should sell off the most. Taxes on dividends go up radically in nine days.
‘I used past performance in December 1986 before the last capital gain tax increase as my reason. He used the statistical “Santa Claus rally.”’
Perhaps it is different this time, but conditional probability (e.g. what happened the last time a sizable increase in the capital gain tax occurred) normally trumps unconditional probability (e.g. annual “Santa Claus rally”).
You forgot to factor in high frequency trading.
They are the market.
“If I lose my bet it would be good for my own bias toward equities. If I win, I expect a big sell off this week.”
It seems like the answer to a couple of big questions will drive the outcome one way or the other. Here are more conditions which will heavily affect the probability you will win your bet:
1) Will an eleventh-hour deus ex machina ‘fiscal cliff’ agreement be forged to slam on the brakes before sailing over the edge?
2) In case of no ‘fiscal cliff’ agreement, will the Fed flood the markets with liquidity to forestall a major stock market correction?
If the answers to 1) and 2) are both ‘no,’ I predict you will easily win your bet.
My reading of Fed comments on number 2) is that they will take measures to limit economic damage in case no ‘fiscal cliff’ agreement is forged. I believe the stock market’s resilience last week in the face of failed ‘fiscal cliff’ negotiations reflects confidence that the Bernanke put is alive and well, and ready to invoke if no fiscal solution is achieved. Bluff notwithstanding, the politicians have good cover at the Fed for whatever action or inaction they choose.
If anyone can shed light on what the Fed’s perceived risks of more QE are (as alluded by Bullard), I’d appreciate you sharing your insights.
Fiscal Cliff 2012: What It Means For The Federal Reserve
BY Eleazar David Meléndez | December 21 2012 9:23 AM
After Federal Reserve Chairman Ben Bernanke coined the term “fiscal cliff,” nearly every reference made to the “massive” negative effects such an event would have on the U.S. economy has been followed by an admonition that politicians need to act, since, when push comes to shove, the central bank won’t be able to do much.
“We want to be clear,” the top central banker said on Dec. 12. “We cannot offset the fiscal cliff.”
Now, as gridlock in Washington makes it increasingly more likely the Fed will be put in the tight spot of having to do something to offset the economic hit the national economy faces, the Fed looks poised to be tested.
It’s a position Bernanke and his peers never wanted to be in. The main concern is to the credibility of the central bank and the damage it could do to the American political system. The “fiscal cliff,” being a politically-induced crisis, should be solved by politicians coming together to take reasonable action, goes the Fed thinking. If the central bank steps in to figuratively bail out the politicians from the consequences of their recklessness, no politician in the future will have an incentive not to act recklessly in economic matters.
At the same time, after spending more than four years performing CPR on the foundering U.S. economy, it’s unlikely the central bank will just allow a recession to happen without executing some aggressive maneuvering.
“If there was a sharp slowdown in the U.S., I do think we’d have further scope to take action, we’d be taking on more risk, but we could do it if the situation called for it,” James Bullard, president of the Federal Reserve Bank of St. Louis, said last May.
There is still plenty of time before year-end to reach a ‘fiscal cliff’ agreement. Don’t worry — be happy — and buy stocks so you can enjoy the ‘fiscal cliff’ relief rally after an agreement is reached.
Updated December 23, 2012, 1:03 p.m. ET
Lawmakers Say U.S. Can Avert Fiscal Cliff
By JEFFREY SPARSHOTT
WASHINGTON—U.S. lawmakers said Sunday it isn’t too late to avert the so-called fiscal cliff, though they acknowledged that time has all but run out for a comprehensive bargain on taxes and spending before year-end.
“I think there is unfortunately only going to be a small deal,” Sen. Mark Warner (D., Va.) said on CBS News’ “Face the Nation.”
The quest to avert the fiscal cliff is as uncertain as ever after rival plans were rejected. WSJ reporters break down how the negotiations will play out from this point on.
Time is short to avert the fiscal cliff—the $500 billion in spending cuts and tax increases set to start in January—unless the White House and Congress reach an agreement. The House of Representatives on Thursday went home for Christmas break after Republicans abandoned House Speaker John Boehner’s backup plan, known as Plan B, which would have extended current tax rates for income below $1 million.
Speaking on Sunday news shows, several lawmakers from both parties said they would support a measure to avoid taxes going up for most Americans.
“It is going to be a patch, because in four days we can’t solve everything. But I think we need to stop this fiscal cliff at a reasonable salary level and then start working on the spending cuts,” departing Sen. Kay Bailey Hutchison (R., Texas) said on CBS.
These chowderheads are still talking about this nonsense around the holidays?
8:39 Pacific time, eve of the last trading day, (eve of Christmas eve): Stock futures are down. S&P future at 1418
A few words to think of at 6:30am Monday:
Well I woke up this morning,
saw stock trades raise my fear,
I woke of this morning,
saw stock trades raise my fear,
The future’s uncertain
the cliff is almost here
Let it go let it go
let it go let it go
Let it go
down that cliff
If we were 1%ers, we might. We are not.
Bought dividend-yielding stocks but they generate nothing compared to CDs 3 years ago. War on the elderly.
FU Bernanke et. al. -
Love King’s Hawaiian (based in Gardena, CA IIRC) but it kills our cholesterol. Bad seniors, BAD, BAD!!!
Oh so sweet, oh so good, especially heated with butter -
The U.S. stock market went up throughout 2012 on ever-thinning volume. We’ve seen where this pattern leads in the past…but maybe this time is different?
Dec. 21, 2012, 8:14 a.m. EST
10 money-making investment ideas for 2013
Where to put your money after 2012’s bull run
By Jonathan Burton, MarketWatch
SAN FRANCISCO (MarketWatch) — An old Wall Street adage says that time in the stock market beats timing the market. But in 2012, both of those strategies worked.
Many stock investors believe that 2013 will be their lucky number. They point to a menu of research reports lauding corporate America’s relatively strong financial shape and the prospects for the U.S. economy’s steady, however slow, growth. By this logic, even holders of low-yielding bonds can expect a steady road for non-government debt, as long as the Federal Reserve holds the line on short-term interest rates.
That said, this bull market turns four years old in March — well-past the two-and-a-half year historical average for U.S. bull runs. Accordingly, next year the major market action may be outside of the U.S. Heading into 2013, the euro zone seems to have priced in its economic troubles for now, and Asia appears to be the growth engine of a global economy that is still debt-laden and disturbingly weak.
How odd, insiders of touted companies in that very same article are selling $hitloads of shares. SBUX, AAPL, GOOG, XOM
Here’s more: VLO, AMT, CSCO, WLP, PCLN, MET, WFM, ABT, MA, ORB, NOC, RTN (the latter three are defense companies, oops - sequestration combined with capital gain tax increase).
And these are just December sales! The combined total from the December sales above is $tens of millions of dollars of stock selling.
I am not ready to buy individual stock until after April.
“Insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise”
- Peter Lynch
What’s your opinion of his book, Beating the Street? It was written a while back, but anything still relevant there?
“… anything still relevant there?”
Do your own thinking? Buy stocks in companies that make products you like and others like?
Buy strong brand names. If people will leave a store and will trouble themselves to go down the street to another store to buy a product that the first store did not offer for sale then there, my friend, is a strong brand name.
Cigarettes come to mind (not that I am advocating buying cigarette stocks). People do not ask for a pack of cigarettes; People ask for a pack of a BRAND NAME of cigarettes, as in “Give me a pack of Marlboros. All out? Never mind then, I’ll go somewhere else to buy”.
So much for bootstraps.
“It’s becoming increasingly unlikely that a low-income student, no matter how intrinsically bright, moves up the socioeconomic ladder,” said Sean Reardon, a sociologist at Stanford. “What we’re talking about is a threat to the American dream.”
For Poor, Leap to College Often Ends in a Hard Fall
On answer may lie in when school stops and when it doesn’t.
If school stops when the bell rings then the student loses out on learning for the remainder of the day. But if school continues on after he goes home then he gets to move ahead a bit, and each bit lenthens the gap between himself and the school-ends-at-three-o’clockers.
If the home environment acts as an extension of the school environment then the student will never be out of the learning mode. But if the home environment is totally different than the school environment then the student misses out as soon as the bell rings at three.
But if the home environment is totally different than the school environment then the student misses out as soon as the bell rings at three.
Summer reading loss. Middle class kids read over the summer, poor kids do not.
3 months a year not reading = 2 year reading gap by the time kids reach middle school.
A student can have the best teachers in the world, but their teachers can never make up for what happens (or doesn’t happen) at home.
This has been documented, studied, and peer reviewed over and over. And yet there are folks out there clamoring for merit pay for teachers.
It’s not just during the summer, it’s every waking hour of the day.
If the kids see their parents reading they they will tend to feel that it is natural for them to want to read. Also, if the parents are intersted in, say the sciences, then the kids will pick up on what the parents say about science - they will pick up on the jargon if nothing else. And this picking up on the jargon puts them well ahead of those who have never heard the jargon before and have no idea what it means.
The broader the education the parents have the greater exposure the kids will have to this education.
Is the Realiars’™ grip on the MSM bully pulpit slipping?
Tax policy which funnels subsidies to wealthy homeowners is unfair, regressive and wasteful.
Housing: Polls on homeowners’ deductions are mixed
December 22, 2012 12:00 am • Kenneth Harney Washington Post
WASHINGTON - In the congressional and White House negotiations on tax reform - including the mortgage interest and property tax deductions - who has the crucial political advantage of counting documented public opinion on their side?
Is it the real estate and building lobbies who argue that maintaining long-standing federal tax benefits is essential, given housing’s key role in job creation, household wealth and the fact that real estate is still in a fragile state coming out of the recession and mortgage bust?
Or is the “cut the debt” proponents and economists who see mortgage write-offs as unnecessary, costly and heavily tilted to favor upper-income owners, especially along the East and West Coasts?
In debates on tough issues like these, advocates invariably point to public opinion surveys that show members of Congress where their constituents stand, and implicitly how they should vote. That process is already well under way on Capitol Hill as the tense debt, tax and budget negotiations head toward the Dec. 31 “fiscal cliff” deadline.
But the polls can be confusing. On the one hand, a new survey by National Journal, a publication widely read on Capitol Hill, found larger numbers of Americans willing to limit both the mortgage interest and property tax write-offs than housing proponents suggest.
The poll of 1,001 adults, jointly sponsored by United Technologies Corp. and released Dec. 11, found that 41 percent of respondents favor reducing the deductions for all homeowners, no matter their income, and another 21 percent favor limits on taxpayers earning more than $250,000 a year. Just 31 percent favored retaining the current system, which allows write-offs on up to $1.1 million in mortgage and home equity debt on primary and secondary homes.
The same survey found roughly similar opinions on the property tax deduction: 42 percent of respondents said they favor limiting it for all owners, 19 percent support reducing it for high-income households, and 31 percent favor no change in the system.
How to interpret these results? One way is to conclude that despite the housing industry’s claims to the contrary, there appears to be noteworthy public support for reducing current mortgage interest and property tax benefits, especially for taxpayers with the highest incomes.
It’s beautiful to discover I am not alone in my views.
How many central banks can there be?
would dont they create another bank and buy more treasuries so the party can continue?
“…would dont they create another bank and buy more treasuries so the party can continue?”
It’s unnecessary with status quo QE-unlimited.
them why are we worried about a fiscal cliff?
Does the FED have the power to keep rates at zero for as long as they want?
This whole debt binge is almost looking like a trap.Its like you load someone up with debt and they become dependent on borrowing to pay the old debt off. Hook them with low interest rates. when it comes to time to borrow more to pay down the old debt interest rates go to the moon.
Who is the FED looking out for here?
“Does the FED have the power to keep rates at zero for as long as they want?”
So they insinuate.
December 23, 2012
Fed plans low interest rates through 2015
by Martin Crutsinger - Dec. 13, 2012 12:14 AM
WASHINGTON - The Federal Reserve said Wednesday that it plans to keep interest rates ultra-low even after unemployment falls close to a normal level — which it thinks could take three more years.
For the first time, the Fed made clear to investors and consumers that it will link its actions to specific economic markers. As long as inflation remains tame, the central bank said it could keep key short-term rates near zero, even after unemployment returns to a more typical rate.
Previously, the Fed said it expected to keep interest rates at record lows at least through mid-2015. Now it expects rates to stay low at least until unemployment drops below 6.5 percent — a threshold the bank believes may not be crossed until the end of 2015.
Analysts said the Fed’s new guidance will make it easier for companies, investors and consumers to make financial decisions because they will have a clearer grasp of when borrowing costs will begin to rise.
“This approach is superior” to setting a timetable for a possible rate increase, Chairman Ben Bernanke said at a news conference after the Fed held a two-day policy meeting and issued a statement. “It is more transparent and will allow the markets to respond quickly and promptly to changes” in the Fed’s economic outlook.
How long can a war on savers last?
“Now it expects rates to stay low at least until unemployment drops below 6.5 percent — a threshold the bank believes may not be crossed until the end of 2015.”
And the trend toward automation continues, so Bernanke is fighting an uphill battle, IMHO.
Longer than savers can stay solvent, I’m sure.
Did the anti-progressive troll go on a bender? I don’t see his name showing up in my Joshua tree filter today…
No. I mean the Troll Who Must Not Be Named.
Gosh, I hope I never get on your bad side, lol!
At war’s end, ramping up drone strikes in Afghanistan
By Sanjeev Miglani
December 19, 2012
The United States carried out more drone strikes in Afghanistan this year than it has done in all the years put together in Pakistan since it launched the covert air war there eight years ago. With all the attention and hand wringing focused on the operations in Pakistan, it’s remarkable that such a ramp-up just over the border has gone virtually unnoticed.
The two battlegrounds are not the same, of course. Afghanistan is an open and hot battlefield where U.S. forces are deployed and the drones are part of the air support available to troops. Pakistan is a sovereign nation and the United States is not in a state of war with it and so you wouldn’t expect the same pace of operations, even though U.S. commanders say the Taliban insurgency draws its sustenance from the sanctuaries in the Pakistani northwest.
U.S. Air Force statistics published by Wired’s Danger Room blog showed there were 447 drone strikes in Afghanistan this year, up from 294 the previous year and 279 in 2010. It is far more than an estimated 338 strikes carried out by the CIA in Pakistan since it began hunting down remnants of al Qaeda, the Taliban and other militant groups in the Federally Administered Tribal Areas eight years ago. The number of strikes in Yemen and Somalia together is 46 over the past decade, notwithstanding the high decibel noise over these missions.
It’s a clear sign the United States is changing the way it is fighting the war in Afghanistan. As the troop drawdown gathers pace ahead of withdrawal in 2014, the smaller number of forces left behind on the ground, especially quick reaction teams, are depending more and more on air strikes to fight the insurgents. And these Predator aircraft which can loiter in an area for as long as 20 hours, are a low cost alternative to having F-18s fly all over the country to carry out these strikes, as Joshua Foust, a fellow at the American Security Project, told me.
Unlike the remotely piloted flights in Pakistan run by the CIA, local military commanders order such operations in Afghanistan, usually to help troops under fire. But they are also used by Special Forces for targeted killings as in Pakistan if intelligence points that way or to thwart insurgents trying to plant roadside bombs, still the biggest killer of foreign and local forces.
Would both sides rather to go over the fiscal cliff than not?
Fear, finger-pointing mount over “fiscal cliff”
By Thomas Ferraro and Richard Cowan
WASHINGTON | Sun Dec 23, 2012 5:33pm EST
(Reuters) - Some lawmakers voiced concern on Sunday that the country would go over “the fiscal cliff” in nine days, triggering harsh spending cuts and tax hikes, and some Republicans charged that was President Barack Obama’s goal.
“It’s the first time that I feel it’s more likely that we will go over the cliff than not,” Senator Joe Lieberman, an independent from Connecticut, said on CNN’s “State of the Union.”
“If we allow that to happen it will be the most colossal consequential act of congressional irresponsibility in a long time, maybe ever in American history.”
“It looks like to me that obviously this is going to drag on into next year, which is going to hurt our economy,” Republican Senator Bob Corker of Tennessee said on CBS “Capitol Gains.”
The Democratic president and Republican House of Representatives Speaker John Boehner, the two key negotiators, are not talking and are out of town for the Christmas holidays. Congress is in recess, and will have only a few days next week to act before January 1.
On the Sunday TV talk shows, no one signaled a change of position that could form the basis for a short-term fix, despite a suggestion from Obama on Friday that he would favor one.
The focus was shifting instead to the days following January 1 when the lowered tax rates dating back to President George W. Bush’s administration will have expired, presenting Congress with a redefined and more welcome task that involves only cutting taxes, not raising them.
“I believe we are,” going over the cliff, Republican Senator John Barrasso of Wyoming said on Fox News Sunday. “I think the president is eager to go over the cliff for political purposes. I think he sees a political victory at the bottom of the cliff.”
Some Republicans have said Obama would welcome the fiscal cliff’s tax increases and defense cuts, as well as the chance to blame Republicans for rejecting deal. Obama has rejected that assertion.
Democrats have charged that Boehner has his own self-interested reasons for avoiding a deal before January 3, when the House elected on November 6, is sworn in and casts votes for a new speaker.
The DC politicians certainly haven’t ceased reveling in ‘fiscal cliff’ scare tactics!
Gloomy predictions as Washington approaches the ‘fiscal cliff’
It’s still possible that the ‘fiscal cliff’ with its automatic tax increases and across-the-board spending cuts can be avoided. But the clock is ticking toward Jan.1, and most lawmakers are pessimistic.
By Brad Knickerbocker, Staff writer / December 23, 2012
President Barack Obama speaks about the fiscal cliff in the briefing room of the White House Friday before leaving for Hawaii to spend Christmas with his family.
The New Year may be more than a week off, but realistically Congress and the White House have less than that as the clock ticks toward the “fiscal cliff” with its automatic tax increases and across-the-board spending cuts that could throw an already-weakened economy into a tailspin.
The ‘fiscal cliff’ uncertainty is working wonders for the value of the dollar.
Yen Declines After Abe Says He May Change BOJ Law
By Monami Yui - Dec 23, 2012 6:11 PM PT
The yen declined versus its peers after incoming Japanese prime minister Shinzo Abe said he will consider changing the law on the central bank unless it boosts its inflation target to 2 percent next month.
The currency fell toward a 20-month low against the dollar even after data showed that futures traders trimmed bearish bets on the yen from a five-year high. The greenback remained stronger versus the euro as concern U.S. lawmakers will struggle to agree on a budget deal boosted demand for havens.
“We do expect the yen to weaken over time,” Todd Elmer, head of Group of 10 foreign-exchange strategy for Asia excluding Japan at Citigroup Inc. in Singapore, said in an interview with Bloomberg Television. “In the medium term we should be looking for a move well into the 85 to 90 region if not higher.”
What would hit the 1% harder: Higher taxes due to a ‘fiscal cliff’ compromise, or a stock market crash due to a ‘fiscal cliff’ joy ride.
THE WEEKEND IS OVER: US Futures Are Falling, And The Yen Is Sliding Again
Joe Weisenthal | Dec. 23, 2012, 7:18 PM
Rian Castillo via Flickr
It was a quiet weekend, but in terms of the global economy, there were probably two main stories:
* Continued concern about the Fiscal Cliff fallout from last week.
* Japan’s incoming PM Shinzo Abe reiterating his demand for a 2% inflation target from the Bank of Japan — a mandate that is expected to weaken the yen.
Hence. US futures are falling. Per ForexLive, S&P futures are down over 7 points.
And the yen is weakening once again.
Europe was fairly quiet, although Mario Monti left the door open to serving as PM again if a party wanted to be lead by him.
Mood is grim in south Stockton, CA
A 70% housing collapse and the Central Valley’s highest murder rate.
“Even among Central Valley cities, Stockton stands out for the pummeling it took in the collapse of the housing market. During the boom, new residents flocked to the city from the Bay Area, boosting the population by nearly 20 percent in the decade between 2000 and 2010.”
“When housing prices fell by roughly 70 percent from the 2005 peak, so did the property taxes that supported the city government. Largely as a result, Stockton has battled budget deficits more severe than many other cities, including Sacramento.”
“In June, Stockton became the largest American city to file for Chapter 9 bankruptcy protection. In addition to the housing crash, the insolvency resulted from the city’s spending on its downtown waterfront, including a $68 million arena, and its decision to boost benefits and pensions for government employees during the boom.”
Buy when there’s blood in the streets. There has never been a better time to invest in Stockton real estate!
Funny. And therefore probably true.
Here’s great comment from the article:
About 20 years ago I was inspecting a downtown hotel in Stockton. I told the owner please pick out three of your best rooms for me to look at. In the last room was a Laotian man who was just waking up from his bed. He had five things next to his bed. I was shocked. He had hit a home run. Never was I more proud of someone.
His items were…..
Yep even back in the 80’s I would call Stockton the land that time forgot. Espcially southeast Stockton around Wilson way. When you inspected a hotel you had to have a stick with a nail on it so when you pulled the sheets back you would not potentially get stuck with a needle. Yep Stockton is great take a look (Stocktons old motto). I lived there for only one year and got the heck out of there.
Gold Declines After Worst Week in Six Months on Budget Deadlock
By Phoebe Sedgman - Dec 23, 2012 6:15 PM PT
Gold extended losses from its worst week in six months as U.S. budget talks stalled, boosting concern lawmakers will fail to agree on a deal to avoid tax increases and spending cuts.
Gold for immediate delivery lost as much as 0.3 percent to $1,652.20 an ounce before trading at $1,657.45 by 10:13 a.m. in Singapore. Prices dropped 2.3 percent last week, the biggest loss since the period ended June 22. Bullion for February delivery was little changed at $1,657.90 an ounce on the Comex.
House Republican leaders canceled a vote on Speaker John Boehner’s plan to allow higher tax rates for annual income above $1 million last week, sending the dollar higher versus most of its major peers. Americans face more than $600 billion in tax increases and spending cuts, a so-called fiscal cliff, if a deal isn’t reached by year’s end.
“The market’s wondering which way it’s going to go,” said David Lennox, a resource analyst at Fat Prophets in Sydney. “The market through last week was pricing in that it was going to be resolved, that there would be some form of watered down version of the legislation put into place.”
Holdings in exchange-traded products backed by gold stood at 2,630.89 metric tons on Dec. 21, data tracked by Bloomberg show. Holdings have climbed 12 percent this year, according to the data. The Dollar Index was little changed today after advancing 0.5 percent on Dec. 21.
Gold is up 6 percent this year, set for a 12th straight annual gain, as central banks from the U.S. to China and Europe took action to prop up economies and expanded bullion reserves.
Is everyone ready for a beggar-thy-neighbor currency war in 2013?
Updated December 23, 2012, 8:25 p.m. ET
Global Currency Tensions Rise
Japan’s Abe Calls on Central Bank to Resist Easing Moves by U.S. and Europe
By TATSUO ITO And WILLIAM MALLARD
TOKYO—Japan’s incoming prime minister fired a volley into increasingly tense global currency markets, saying the country must defend itself against attempts by other governments to devalue their currencies by ensuring the yen weakens as well.
Shinzo Abe’s call comes as others including Bank of England Gov. Mervyn King warn that the world’s economic-policy makers risk becoming embroiled in currency spats that could heighten tensions among countries.
Incoming Japanese Premier Shinzo Abe, center, is pressing the central bank to take aggressive steps.
Mr. Abe on Sunday called on Japan’s central bank to resist what he described as moves by the U.S. and Europe to cheapen their currencies and noted that a yen level of around ¥90 to the dollar—it was at ¥84.38 in early Asian trading Monday, down from ¥84.26 late Friday—would support the profit of Japanese exporters.
“Central banks around the world are printing money, supporting their economies and increasing exports. America is the prime example,” said Mr. Abe, referring to the Federal Reserve’s policy of flooding the market with dollars by purchasing massive amounts of Treasury bonds and other assets.
“If it goes on like this, the yen will inevitably strengthen. It’s vital to resist this,” said Mr. Abe, who will become prime minister on Wednesday.
Mr. King, in an interview this month, said, “I do think 2013 could be a challenging year in which we will, in fact, see a number of countries trying to push down their exchange rates. That does lead to concerns.”
We’re being hit by a rain storm right now and evening temps are supposed to drop down to 29°F. Act II, black ice.
Good luck. Where are you?
Eastern Washington’s Columbia Basin.
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