March 3, 2013

Bits Bucket for March 3, 2013

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Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 01:27:06

Looming Sequestration Cuts Will Hit D.C. the Hardest
By Roy Oppenheim
March 1, 2013

With so many federal workers living in and around our nation’s capitol, those federal spending cuts will eventually translate to job cuts and unpaid mortgages.

The dreaded sequestration deadline has arrived, and with it $85 billion in automatic spending cuts that could plunge the nation’s strengthening economy back into the depths of recession.

(For some light reading on the topic, check out the 394-page Office of Management and Budget report.)

But contrary to many media reports, the majority of spending cuts will be felt most acutely in the federal government’s hometown: Washington, D.C., a region that, ironically, suffered the least in the economic downturn.

While most of the rest of the country’s housing market suffered during the recession—with foreclosures becoming the rule instead of the exception—the Beltway has had one of the strongest housing markets in the country.

Having visited the area during the economic crisis, it always struck me as odd how little suffering there seemed to be there compared to the rest of the nation, and in particular Detroit, Arizona, Las Vegas, and of course Florida.

But with so many federal workers living in and around our nation’s capitol, those federal spending cuts will eventually translate to job cuts, unpaid mortgages and … well we all know how that story has gone.

Comment by goon squad
2013-03-03 07:26:03
Comment by eight pieces of chicken
2013-03-03 08:30:50

And in Maryland, where the losses will be infinite.

Comment by In Colorado
2013-03-03 09:34:18

To infinity … and beyond!

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Comment by MacBeth
2013-03-03 09:57:38

Join me, as I hang my head in shame.

My head is forever held in shame, so if you are not free today, swing by tomorrow at 6:00 p.m.

There’ll be taxpayer-funded punch and cookies available to compensate for any impactful loss of energy whilst standing In Shame.

Please note: You are not allowed to bring your own punch and cookies.

 
 
 
Comment by Ryan
2013-03-03 08:35:55

What is the current project loss (nationwide average)?

Are we still at 65%? Or has it risen now that Sequestration is happening?

When will houses be free? I want to plan my budget for rent accordingly so I can create a retirement strategy.

Comment by In Colorado
2013-03-03 09:35:47

When will houses be free?

After the incalculable losses are realized.

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Comment by MacBeth
2013-03-03 10:11:03

Geez, Ryan. Let me fill you in on what is coming…

Only federal workers, who soon will be facing Incalculable Losses Unlike The World Has Ever Seen will have access to free houses.

You will still get to pay for yours, as you are of the Peon class.

 
Comment by Housing Analyst
2013-03-03 14:10:53

“Houses are depreciating assets, always. ALWAYS.

 
 
 
 
Comment by Bill in Los Angeles
2013-03-03 08:24:54

$53.3 billion per year is spent on foreign aid. $25 billion is spent maintaining federal buildings not even used. There’s $78.3 billion per year hat could easily be cut without “disastrous pain” inflicted on federal employees.

http://www.unitedliberty.org/articles/12873-the-sequester-made-easy

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 09:35:01

Your suggestion violates one of the key features of the sequester, which is dumb, across-the-board cuts to a small slice of overall government spending (e.g. entitlements get a pass).

Comment by Bill in Los Angeles
2013-03-03 09:52:48

Forget that across-the-board policy and think about it….how can you enjoy being taxed to pay to someone foreignor? Even one penny is too much. And $25 billion to pay for maintaining unused buildings.

Okay. Back to sequester…if it is to be across-the-board, c’est la vie. But a lance again at the constitution says “provide” for the common defense and “promote” (NOT “provide”) the general welfare. Establish justice. So at most, government is tasked to have a defense of its states and territories ( not be world cop), and have a justice system. I can justify more than 60% cuts in military spending and 100% cuts in all other spending except on a justice system.

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Comment by Ryan
2013-03-03 11:17:12

What about social justice?

 
Comment by Bill in Los Angeles
2013-03-03 11:35:05

Show me the area in the constitution where taxpayers must provide social justice.

 
Comment by Bill in Los Angeles
2013-03-03 11:36:57

There is no such thing as “social justice,” since “social” is made up of individuals. We have equality of law and individual rights. One’s right does not take away from another’s right, or it is not even a right.

 
Comment by RioAmericanInBrasil
2013-03-03 11:49:03

There is no such thing as “social justice,” since “social” is made up of individuals.

Right dude. And there’s no such thing as a baseball team because “teams” are made up of individuals.

And there is no such thing as a country because countries are “made up of individuals”.

And the Constitution was not a social contract.

Yea, that’s the ticket.

 
Comment by MacBeth
2013-03-03 13:26:52

So that’s why you moved to Brazil! (How could I have been so dumb not to figure it out until now? Geesh.)

You wanted a free meal ticket and found the one that best suits your culinary tastes in Brazil.

Problem now is that you’d rather be back in the States, but can’t get the freebies you seek and thus you are stuck in Brazil. And there’s that pesky problem of how to paper over your former declarations of hate for selfish Americans.

Sucks to be you.

 
Comment by Bill in Los Angeles
2013-03-03 13:32:38

+1 MacBeth

 
Comment by Pimp Watch
2013-03-03 17:59:28

+1

 
 
 
 
Comment by Skroodle
2013-03-03 10:33:19

In D.C.’s tight market, home buyers go extra mile to find possible sellers

Soaring demand this year is expected to exacerbate the problem, according to Lisa A. Sturtevant, deputy director of the Center for Regional Analysis at George Mason University. The center projects that 42,000 new jobs will be created in the region this year, up from 36,000 last year.

Many of the new jobs, Sturtevant said, will be filled by people moving into the area who need homes.

Another reason for the lack of homes for sale is too many homeowners owe more than their property is worth. “Those homeowners can’t generate enough profit, especially after they pay the transaction costs of selling, for them to make a down payment on another property,” says John L. Heithaus, chief marketing officer of MRIS. “The only thing that will help these homeowners is for prices to rise faster.”

http://www.washingtonpost.com/realestate/in-dcs-tight-market-home-buyers-go-extra-mile-to-find-possible-sellers/2013/02/28/7d743a32-6f0d-11e2-aa58-243de81040ba_story.html

 
Comment by Carl Morris
2013-03-03 13:27:07

Looming Sequestration Cuts Will Hit D.C. the Hardest

No wonder it’s getting so much coverage.

 
Comment by ecofeco
2013-03-03 14:21:37

“But with so many federal workers living in and around our nation’s capitol, those federal spending cuts will eventually translate to job cuts, unpaid mortgages and … well we all know how that story has gone.”

Welcome to our world!

 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 01:29:42

In Hampton Roads, some people are already feeling the effects …

Real estate market braces for sequester
Updated: Monday, 25 Feb 2013, 11:20 PM EST
Published : Monday, 25 Feb 2013, 10:13 PM EST

NORFOLK, Va. (WAVY) - A realtor told 10 On Your Side homeowners aiming to sell soon should brace for a major impact if a sequester takes place later this week.

For weeks, Americans like Blair Emil have been waiting for a solution to be reached in Congress regarding across-the-board cuts that will be felt throughout the country.

“The Republicans have to give, the Democrats have to give, and it seems that every time it appears they might be, one of the Republicans or one of the Democrats stands up and says, ‘Nope, I changed my mind, I don’t like that,’” Emil said.

Emil is a government contractor being transferred to Florida. His home has been on the market for the past eight months.

“We don’t have a buyer, we don’t have a renter… We’re taking a big chance,” Merry Emil said. “It’s just generally going to be harder and harder to sell because of the tightening of the lending and the less people who can afford to buy.”

Comment by vinceinwaukesha
2013-03-03 14:03:56

” major impact if a sequester takes place later this week.”

So they’ll be an epic fail is something new happens real soon now.

“His home has been on the market for the past eight months.”

Oh I see long since a dead man walkin’ Real estate = anchor around neck.

I used to go around saying things like the ability to multiply and divide is an anti-american revolutionary act because so much of the current charade depends on Americans being unable to tackle advanced math like “division”. Apparently I was aiming too high and simple numerical comparisons are the stealth anti-american torpedo.

Comment by ecofeco
2013-03-03 14:23:44

Americans and math?

Oil and water.

If most Americans could do even basic math, things would have changed a long time ago.

 
 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 01:31:55

Sequester Threatens Housing Market
Updated: Mar 02, 2013 8:39 PM PST
Inside KWQC.com

The deadline for the sequester cut is looming for the Quad Cities and the nation.

Congress has one week to take action, or else the Rock Island Arsenal would be forced to cut $197 Million, 1,008 jobs, and furlough civilian workers.

Ruhl & Ruhl realtor Connie Coster says, “This will have a major impact on the housing market,” especially hers.

As the relocation rep for Ruhl & Ruhl, can receives 20 percent of her business comes from rock island arsenal workers.

Coster says a job loss like this, would be like nothing else.

“Where are 1,000 people going to find jobs right now?”

She goes onto say, “it’s going to be like if you had a really bad infection and at the tail end you quit taking your antibiotics it comes back three fold and it is going to be devastating.”

Comment by azdude
2013-03-03 12:42:10

when does goldman have enough retail investors in the market to absorb all the stock they have bought with bernake bucks?

 
Comment by ecofeco
2013-03-03 14:31:24

““Where are 1,000 people going to find jobs right now?””

From the back of the line. :lol:

Comment by localandlord
2013-03-03 20:32:11

Well someone’s working overtime spinning out the doom and gloom at a record rate.

I thought the sequester meant the workers went to a 4 day week. A little extra time to plant a garden, do house repairs, cook real food, clean out the closets & garage and uncover all the stuff you don’t have to buy ’cause you already own it.

Just might be a bump up in the ole quality of life. They might not want to go back to the 5 day week.

Comment by Pimp Watch
2013-03-03 20:45:43

Nonsense.

Falling housing prices to dramatically lower levels is positive bullishness.

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Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 01:33:34

Sequester to Stunt Recovery Plans for FHA, Cause Delays
February 28th, 2013 | by Jason Oliva Published in FHA, News, Reverse Mortgage

The $1.2 trillion in spending cuts scheduled to kick in March 1, as part of the so-called “sequester,” will trim the budgets of a number of government programs. If Congress and the White House do not reach a deal on how to address these cuts, which looks unlikely as March 1 approaches, the results could mean slower recovery progress for the real estate market, and delays within the Federal Housing Administration more specifically.

In addition to cuts to housing counseling programs outlined by Department of Housing and Urban Development Secretary Shaun Donovan in mid-February, HUD will also experience the cuts all the way down to the employee level.

“Sequestration would directly affect the employees who work for HUD itself, along with their families and communities,” Donovan said in the testimony delivered February 14. “I am privileged to lead just over 9,000 HUD employees around the nation in 81 field offices around the country. Specific plans are still being reviewed and finalized, but we believe that furloughs or other personnel actions may well be required to comply with cuts mandated by sequestration.”

Those furloughs are likely to lead to fewer services available that will impact the public, Donovan said.

“The public will suffer as the agency is simply less able to provide information and services in a wide range of areas, such as FHA mortgage insurance and sale of FHA-owned properties,” he said.

On a larger scale, the sequester is likely to inhibit FHA’s insurance programs, Bloomberg News reported Thursday.

 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 01:35:27

Looming Sequestration Expected to be a Villain to Commercial Real Estate Industry
Posted by Hortense Leon 02/27/13 8:01 AM EST

The $85 billion chunk that will likely be extracted from the US federal budget, and therefore the US economy, during the process of sequestration– slated to begin on March 1–will be a blow to US commercial real estate.

Because the federal government is omnipresent–as an office tenant, as a builder of roads, bridges, military facilities, prisons and even offices–the revenue that the federal government contributes to the commercial real estate economy will be missed. Construction contractors and office leasing brokers are among the ones most likely to be affected.

Government Properties Income Trust, Corporate Office Properties Trust, Piedmont Office Realty Trust, First Potomac Realty Trust, Brandywine Realty Trust and Vornado Realty Trust–all REITs with heavy exposure to Washington, D.C.–ended the day in negative territory on Monday, reported SNL Data Dispatch, an online newsletter put out by SNL Financial LC, referring to stock market trading.

REIT analyst John Guinee with Stifel Nicolaus told the SNL Financial newsletter that the sequestration would damage office fundamentals in Washington, D.C. REITS, such as First Potomac and Vornado, that own a lot of “commodity product,” will cut rents to lure tenants, he said.

According to a February 7, 2013 report by the Associated General Contractors of America, “…the sequestration process would reduce many federal construction investment accounts in FY 2013 with the exception of the Highway Trust Fund, Airport Improvement Program, Department of Veterans Affairs accounts, and General Service Administration accounts. By AGC’s estimates, the cuts to federal construction accounts could exceed $4 billion.”

Sequestration will affect a broad range of construction projects, including drinking water and wastewater facilities, military housing, and affordable housing. Affordable housing will be affected because of cuts to the Department of Housing and Urban Development.

 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 01:37:30

Sequestration Could Cut Lifelines to Hurricane Sandy Victims
By AOL Real Estate Editors | Posted Feb 28th 2013 4:43PM

Some Hurricane Sandy victims still struggling to recover from the devastating storm may find themselves waiting even longer for a lifeline — because of the looming federal budget cuts known as “sequestration.” But other victims are just now finally receiving help from state programs that were promised some time ago. The financial tussle in Congress is pitting a group of people who have already lost nearly everything into two groups: the haves and the have-nots.

Right now, a New York State program to buy up Sandy-ravaged properties and waterfront homes most vulnerable to storms is kicking into gear. The program will offer homeowners the pre-storm market rate for their homes, and then the government will tear them down rather than use disaster relief funds to rebuild homes continually in harm’s way. “I think it’s about time, because we’ve been trying to fight this since 1992 [with Tropical Storm Danielle],” Staten Island resident Sal Importa told New York City TV station PIX 11. “We’ve been waiting a long time for something like this to happen.”

But over in some hard-hit New Jersey towns that are still in the middle of rebuilding, the sequestration’s automatic budget cuts scheduled for March 1 — which could total $85 billion — might stop their efforts in their tracks. U.S. Rep. Bill Pascrell (D-N.J.) said that cuts to Sandy aid could reach $3 billion because of sequestration. That has the potential to halt or severely set back recovery projects for transit, individual homeowners, businesses and government properties, New Jersey’s Star-Ledger newspaper reported.

Comment by aNYCdj
2013-03-03 08:49:03

This makes sense….and it should be stated from now on anyone who builds on flood prone properties are on their own.

Federal flood insurance should have been treated like a pre existing health condition…it should never have been available for newly built homes..

——————–
and then the government will tear them down rather than use disaster relief funds to rebuild homes continually in harm’s way.

Comment by Skroodle
2013-03-03 10:45:23

Makes no sense at all.

Giving homeowners tax payer money for houses that no longer exist??

Didn’t they have home insurance that already paid them?

Comment by aNYCdj
2013-03-03 14:45:11

A lot of houses were not in a recognized flood zone…that’s why NYC had no power for days…Con Ed built a flood wall 1.5 feet higher then any recorded flood in NYC and sandy went almost 2 over that….

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Comment by ecofeco
2013-03-03 14:34:47

Could? Might?

Nothing but spin and fear.

 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 01:39:26

Sequester squeezes housing authorities
Reporter - Elizabeth Fields
Photojournalist - Mason Watkins
Story Created: Wed Feb 27, 2013 8:26 PM
Story Updated: Wed Feb 27, 2013 8:44 PM

PADUCAH, Ky. - There are more than 800 apartments in The Housing Authority of Paducah and they are funded by the federal government. That’s why Executive Director Cal Ross has been working on a budget that assumes Congress will not compromise and he will be forced to cut thousands of dollars because of the sequester.

“We’re going to have to watch our p’s and q’s on every nickel we spend this coming year to stay within the funds the government’s going to give us under the sequester,” he said. HAP will lose $276,000 directly because of the sequester so he was forced to freeze his employees wages.

“My performance was the same,” said Crystal Rothrock, Director of MIS. “I did just as well, but because Congress can’t make a decision the money’s not available for me to have a raise, so therefore, my family is impacted.”

Residents will be impacted, too. Jackie Floyd is the Director of Property and Management and said because unfilled positions will remain empty and not all seasonal positions will get filled, there will be a strain on the maintenance department.

“We just can’t give the response time that we normally would when we don’t have to deal with this,” said Floyd. She means response times for maintenance calls will be slower. They take about 24 hours now, but residents may have to wait more than 2 days in the near future.

“It ends up being frustrating to our residents because they don’t understand all of what’s going on with the sequester,” she said.

Comment by Bigguy
2013-03-03 08:08:59

Doom and gloom, doom and gloom. Everything will get blamed on the sequester whether there is any actual evidence or not.

All those complaining about bloated government, defense contractor largesse, etc. should be praising who,ever is responsible for some cuts FINALLY happening.

All these articles are the exact reason we are in is mess, the moneyed and vested interests don’t want to see an end to the teat. The RE shills definitely don’t ever want anything but more spike in the punch bowl.

Comment by goon squad
2013-03-03 08:16:11

defense contractor largesse

“contractors make up 70 percent of the Pentagon’s costs for delivering services, while federal employees make up just 30 percent”

http://articles.washingtonpost.com/2013-01-14/politics/36343675_1_furloughs-or-other-actions-sequestration-civilian-workforce

 
Comment by aNYCdj
2013-03-03 08:53:57

Big Guy….Dooooomm and Gloooommmm:

http://www.youtube.com/watch?v=rPFGWVKXxm0

Comment by aNYCdj
2013-03-03 14:59:44

What nobody likes Mick Jagger anymore??????

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Comment by MacBeth
2013-03-03 09:13:19

TENET: The larger the federal government becomes, the greater the lies it must tell in order to justify its existence.

Hence, the b.s. about the sequester. It’s all nonsense. The sequester is a “hardship” for those in government. It will spell the end of the world!

In reality, federal workers may have to begin paying for what were freebies at taxpayer expense.

Perhaps federal workers ought to be treated as they treat small businesses.

Let federal workers pay for their own office supplies. Including pencils, pens, paperclips, paper, utlities, etc.

Let them do so while generating a profit for the American citizens.

Let them do so while private, small business organizations supervise their every move. If that’s too costly, add a few hundred thousand drones to fly around inside every federal office simultaneously. That way, a small business owner can watch every move made in a way more convenient to them.

If they fail to report in to said small business organizations, they can pay a fine, go to jail, or both. They can also get ticketed for infractions spotted by the drones. To make paying those fines easy, it can all be done paperless.

If federal workers succeed on all these fronts, great! They can celebrate by handing over their annual “contributions” to small business. If not, they are out of a job.

How much in “contributions”? Oh, let’s say 3.6% of annual income. The same amount that incomes have dropped nationwide, on average, recently.

Let’s say you a middle management supervisor at the EPA. Let’s say you pull in $100,000 annually.

I think that supervisor ought to be told, under threat of legal prosecution, that he or she MUST place $3,600 in cash annually into the hands of, say, Arizona Slim, so that she can buy office supplies, maybe a printer or two, pay for utilities, etc., at the expense of that EPA middle manager.

That’d be fair, don’t you think?

In fact, more than fair, because unlike AZ Slim, the EPA middle manager still makes a great deal more money than Slim.

I think at the very least that AZ Slim ought to be given free passes and plane trips to a half dozen cultural events held every year nationwide. All at that EPA middle manager’s expense.

Comment by Combotechie
2013-03-03 09:47:23

“TENET: The larger the federal government becomes, the greater the lies it must tell in order to justify its existence.”

The larger the federal government becomes the greater the number of people there are who have a stake in its enormous and growing size.

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Comment by MacBeth
2013-03-03 11:27:38

True, combo.

Answer me this, please:

Is it not interesting that in an era of increased reliance upon government, that that same government perceives greatly increased need for surveillance of its own people?

Why is this phenomenom so, exactly?

 
Comment by Pete
2013-03-03 17:06:38

“Why is this phenomenom so, exactly?”

“9-11 changed everything”–Dick Cheney
Seriously, the govt probably doesn’t perceive any increased need, they just see that they can get away with it, so they (we) go for it. I mean to say it’s unrelated to the increased reliance on govt, at least as far as social programs.

But you could call our acceptance of the surveillance an increased reliance on govt. in its own right.

 
 
Comment by Skroodle
2013-03-03 10:47:45

I like the plan. Maybe the Federal employees can find private sponsors to pay their salaries?

For example, BP could sponsor EPA employees.

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Comment by Bigguy
2013-03-03 10:59:35

SEC, brought to you by Goldman Sachs!

 
 
 
Comment by ecofeco
2013-03-03 14:37:23

“Doom and gloom, doom and gloom. Everything will get blamed on the sequester whether there is any actual evidence or not.”

Exactly.

 
 
Comment by vinceinwaukesha
2013-03-03 14:11:43

“There are more than 800 apartments in The Housing Authority of Paducah and they are funded by the federal government.”

Why? And why are the 800+ people helped more important than everyone else including myself?

“HAP will lose $276,000 directly because of the sequester”

Hmm. $276K/800 = $345 per year per apartment? So their loss, just loss alone, is that much? How much are they spending per apartment per year… ?

I would imagine this is probably like those .mil boondoggles where a toilet seat costs $7K or whatever, although instead of being aerospace grade its just home depot special with a bit of .gov price markup.

Comment by Northeastener
2013-03-03 14:55:01

Why? And why are the 800+ people helped more important than everyone else including myself?

From each according to one’s abilities, to each according to one’s needs, Comrade… you obviously don’t need the help else the government would be helping you already.

 
 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 01:41:02

Politics
UPDATED: Maxine Waters: ‘Over 170 million jobs could be lost’ due to sequestration [VIDEO]
3:44 PM 02/28/2013
Jeff Poor

Update, 5:20 p.m.: Harry Gural, a spokesman for Rep. Waters, told The Daily Caller in an email that the congresswoman “obviously misspoke – she meant 170 thousand, not 170 million, jobs.”

In a Thursday press conference, California Democratic Rep. Maxine Waters warned of job losses totaling 170 million if the sequester goes through. Waters’ warning comes at a time when there are estimated to be between 135 and 143 million jobs in the United States.

Comment by Combotechie
2013-03-03 07:31:13

Maxine Waters “obviously mispoke…”.

Yeah, right.

Comment by hazard
2013-03-03 09:44:26

“obviously mispoke…”.

The Truth-O-Meter

“Today, we have two Vietnams, side by side, North and South, exchanging and working.”

Sheila Jackson Lee on Thursday, July 15th, 2010 in a special order speech on the U.S. House floor

“I stand here asking us to do what we did not do in Vietnam, (which) was to recognize the valiant and outstanding service of our men and women, and to understand victory had been achieved,” she said during the special order speech, which House members can give on any topic at the end of a day’s legislative work.

“Today, we have two Vietnams, side by side, North and South, exchanging and working,” she said. “We may not agree with all that North Vietnam is doing, but they are living in peace. I would look for a better human rights record for North Vietnam, but they are living side by side.”

Quick history lesson, compliments of the CIA World Factbook:Under the 1954 Geneva Accords, Vietnam was divided into the Communist North and anti-Communist South. The United States’ military presence in South Vietnam grew during the 1960s in an attempt to bolster that government, but armed forces withdrew in following a cease-fire agreement in 1973. Two years later, North Vietnam conquered the south, reuniting the two countries under Communist rule.

Today, the Socialist Republic of Vietnam is home to Hanoi and Ho Chi Minh City.

Jackson Lee was four decades too late in her reference to two Vietnams.

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 12:28:17

“…the Socialist Republic of Vietnam is home to Hanoi and Ho Chi Minh City.”

Sounds like a promising candidate for a U.S. trading partner…

P.S. I have been to Vietnam, where I witnessed a form of grass-roots self-organized capitalism that would make a hard-core free-market economist drool. There is nothing like it on the streets of America.

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Comment by ecofeco
2013-03-03 14:40:14

Intel (IIRC, or one of the other major chip makers) has built a 4 billion dollar chip plant there.

We’ve been trading with Vietnam for a few decades now.

 
 
 
 
Comment by eight pieces of chicken
2013-03-03 08:44:22

I agree US americans are not good at math.

 
Comment by In Colorado
2013-03-03 09:39:38

While I’m not a fan of the bombastic Rep. Waters, I’m pretty sure that number was a slip of tongue.

Comment by Skroodle
2013-03-03 10:48:59

Wall Street can’t stand her, so I sorta like her just because.

Comment by Carl Morris
2013-03-03 13:34:19

Interesting. Despite her obvious weaknesses, she must not be willing to be bought by them. I’ll have to keep that in mind.

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Comment by Northeastener
2013-03-03 15:02:02

While I’m not a fan of the bombastic Rep. Waters, I’m pretty sure that number was a slip of tongue

A slip of the tongue that was obviously in favor of her argument. Why is it “slips” from politicians in speeches like this are always in favor of creating more support for their argument instead of less?

There is another term for this, called exaggeration… otherwise known as lying. Considering 31% of her constituents are black and latino, I get the impression she was catering to the less educated, statistically speaking.

Comment by In Colorado
2013-03-03 15:09:13

Aw c’mon, that number was so obviously too big who would have believed it? This reminds me of the fury over Obama’s “57 states”

If you don’t like Waters there are plenty of more important and relevant reasons to attack her than that. Especially when a member if her staff issued a correction to her statement.

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Comment by alpha-sloth
2013-03-03 15:11:51

Considering 31% of her constituents are black and latino, I get the impression she was catering to the less educated, statistically speaking.

Kind of like W’s constant garbling of his speeches, and the less educated people, statistically speaking, he was catering to?

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Comment by Northeastener
2013-03-03 19:39:17

W was a terrible public speaker.

 
 
 
 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 01:43:24

California braces for impending cuts from federal sequestration
The combined effects of cuts in defense and other programs are expected to slow the momentum that California’s economy has been building over the last year.
February 25, 2013|By Ricardo Lopez and Richard Simon, Los Angeles Times

California’s defense industry is bracing for a $3.2-billion hit with the federal budget cuts that are expected to take effect Friday.

But myriad other federally funded programs also are threatened, and the combined effect is expected to slow the momentum that California’s economy has been building over the last year.

As the state braces for pain from so-called sequestration, there are warnings of long delays at airport security checkpoints, potential slowdowns in cargo movement at harbors and cutbacks to programs, including meals for seniors and projects to combat neighborhood blight.

Despite the grim scenarios from local and state officials, economists say the cuts’ overall blow to the economy would be modest, felt more acutely in regions such as defense-heavy San Diego and by Californians dependent on federal programs, such as college students who rely on work-study jobs to pay for school.

Comment by azdude
2013-03-03 07:41:19

who doesnt get hurt by the cuts?

Comment by eight pieces of chicken
2013-03-03 09:18:41

banks?

 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 09:38:08

I’m guessing places with strong local economies and little dependence on federal dollars (e.g. oil-rich North Dakota comes to mind)…

Comment by polly
2013-03-03 10:08:27

The states most and least affected by the sequester, in one chart

http://www.washingtonpost.com/blogs/wonkblog/wp/2013/02/25/the-states-most-and-least-affected-by-the-sequester-in-one-chart/

The White House released a state-by-state analysis of the sequester’s impact this weekend. But while the sequester’s cuts are across the board, they don’t affect all states equally, as states rely on federal aid to varying degrees.

The Pew Center on the States has measured each state’s exposure to the sequester by calculating its federal aid subject to the sequester as a percentage of the state’s total GDP. Here are the states that are most and least affected by the sequester by that calculation:

[see link for the chart]

Please note that this seems to apply to aid (direct to state and to population?), so isn’t a real measure because it doesn’t include salaries lost and the salaries for feds and contractors could easily swamp the other numbers.

But given that, the top 5 states on the list are:
South Dakota
Illinois
Georgia
Texas
Tennessee

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Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 12:31:22

Interesting that despite a range of variation, there aren’t any states which are largely independent of the federal money spigot.

 
 
 
 
Comment by hazard
2013-03-03 09:12:59

Just a thought, maybe we could cut the $56 billion in foreign aid and diplomacy or the additional $14 billion we give other countries to train armies and acquire weapons. How much of that $70 billion we give away do we have to borrow first, what $35 billion?

By Associated Press, Feb 26, 2013 10:41 PM EST

AP Published: February 25

“You don’t want to have to choose between, ‘let’s see, do I close funding for the disabled kid, or the poor kid? Do I close this Navy shipyard or some other one?’” Obama said. “You can’t gloss over the pain and the impact it’s going to have on the economy.”

http://www.washingtonpost.com/business/obama-warns-that-uncertainty-over-budget-cuts-already-taking-hold-ahead-of-friday-deadline/2013/02/25/236d1dbe-7fb7-11e2-a671-0307392de8de_story.html -

You Ask, We Answer: How Much Does the U.S. Spend on Foreign Aid

Written by Mattea Kramer on Oct. 22, 2012 in International Affairs .

When asked if they support cutting certain types of federal spending, many Americans say they’d like to see the U.S. reduce the amount of aid we give to foreign countries. So it’s worth knowing: How much does our federal government currently spend on foreign aid?

Very little, as it turns out.

Foreign aid and diplomacy – which includes the State Department budget – together account for around 1 percent of all federal spending, or about $56 billion in President Obama’s fiscal 2013 budget. That doesn’t include foreign military assistance, which is the money we give other countries to train armies and acquire weapons. That type of assistance clocks in at an additional $14 billion.

President Obama’s projection of $56 billion for international affairs represents a $7 billion increase over the amount spent in fiscal 2012. Meanwhile, Governor Romney has said that he hopes to cut all non-military discretionary spending by 5 percent upon entering office, a move that would reduce funding for foreign aid and diplomacy in fiscal 2013 by around $2.4 billion.

http://nationalpriorities.org/blog/2012/10/22/you-ask-we-answer-how-much-does-us-spend-foreign-aid/ - 34k -

Comment by Skroodle
2013-03-03 10:53:35

Foreign aid is buying peace. Well worth the cost. We can’t invade every tiny country in the world.

Comment by Bill in Los Angeles
2013-03-03 11:09:45

You are welcome to write a check to donate to the bribe of foreign nations so that their citizens don’t come over to terrorize us. But why force others to write checks if they do not want to participate in the bribery?

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Comment by ecofeco
2013-03-03 14:42:32

Why? Because that’s how a republic works.

You can always move. Oh wait, most governments are representatives and not pure democracies.

 
Comment by alpha-sloth
2013-03-03 15:21:58

most governments are representatives and not pure democracies.

The majority rules in a ‘pure democracy’ as well as a representative one. You can still be compelled to do or not do something by the will of the majority.

But I think Bill has eschewed democracy in favor of ‘voluntaryism’, or something.

 
 
 
Comment by vinceinwaukesha
2013-03-03 14:22:43

Its interesting to see the political leanings in the various agitprop quotes about this topic. For example the ratio of civilian money spent vs military money spent can’t be higher than 5 to 1 and given how expensive .mil stuff is I’d assume virtually all of the 56B is spend on the “diplomacy” part of “foreign aid and diplomacy”. Also you’ll see a lot of partial quoting of this statement such that we spend 56B on .mil assistance, or careful omission of the whole “diplomacy” cost, etc.

The .mil aid isn’t “spent on the foreign country” its almost all spent on domestic political contributor corporations who make the stuff. We could ship them boxes with rocks in them, as long as big contributor gets $$$ from the fedgov all is well.

However if you guess 1000 embassies, which seems reasonable given the number of countries and of course some might have two, thats about “fifty million” spent per embassy per year. Which is probably a bit extravagant. Looking at a typical embassy (not just Iraq, or whatever) does it seem reasonable they blow thru $50M/year? $5M is probably low, but maybe average, there must be lots of small “do nothing” offices for every giant building?

 
 
Comment by anngogh
2013-03-03 13:22:42

SAN DIEGO (CBS 8) - A celebratory mood was felt along the San Diego waterfront as hundreds celebrate the christening of the Navy’s newest ship.

The mobile landing platform Montford Point was launched at the General Dynamics Nassco shipyard Saturday.

But the mood was tapered by the automatic spending cuts that will hit the Military hard.

As more than a thousand people celebrated the christening of the US Navy’s newest ship, the specter of sequestration on the area’s shipbuilding industry surfaced during the ceremony.

“I had 10 minutes of remarks prepared. But now that I’m under sequestration I have to deduct 10 percent — so I’m only going to give you nine minutes of remarks this morning,” said US Navy Rear Admiral David H. Lewis.

But the effect of these now-mandated federal budget cuts on shipbuilding, one of San Diego’s most significant economic drivers, is no laughing matter.

“This is a severe crisis and must be addressed immediately,” said San Diego Maritime Jobs Coalition’s Robert Godinez.

At a recent rally by the San Diego Ship Repair Association, the impact of sequestration on families who rely on Military contracts to make ends meet were fired up.

But with no deal by Friday’s deadline there is no stopping these across the board spending cuts, at least for the time being.

“Ships will not be repaired, our readiness as a nation will go down, civilians in the defense department will be laid off,” said San Diego Mayor Bob Filner.

If not reversed, sequestration on the shipbuilding industry here in San Diego could mean the loss of 5,000 maritime industry jobs. As well as the loss of 10 ship maintenance projects, saving almost $200,000, and the cancellation of aircraft maintenance at North Island saving $83 million.

Already, Nassco informed 1,040 of its employees in San Diego, as well as in Virginia and Florida that layoff notices would likely be issued early next month — including workers who helped create this latest awe-inspiring addition to the Navy’s fleet.

“I can’t think of a better argument, why we need to protect ourselves from indiscriminate cuts,” said Lewis.

More than 25,000 Department of Defense employees in San Diego will also face mandatory furloughs as a result of the budget cuts.

Comment by ahansen
2013-03-03 21:50:56

Oh Waaaah, waaaah, waaah. Maybe prof will finally be able to buy a house there after all — that is, if he wanted to….

 
 
 
Comment by hazard
2013-03-03 05:40:55

Law-enforcement agencies eager for Web-surveillance tools

Published 5 September 2012

Private technology firms are pitching software capable of analyzing large swaths of the Internet to local law enforcement looking for ways to stop the next mass shooting or domestic terrorist event before it happens.

Facebook, Twitter, and other social networking sites use an automated tool to decide what is important and what is not. Now, technology companies are selling the software to police departments to help them capture online information from terrorists, traffickers, pedophiles, and rioters.

The advancement of technology allows for greater surveillance capabilities, and that has law enforcement agencies eager to acquire their own tools to track people who might be planning or thinking about taking out their frustrations on other citizens.

Any data you send out, no matter how small, can be processed for search sites and locations that reveal “patterns of interest” to law enforcement in real time. Using the TextMiner tool owned by SAS Institute, law enforcement can determine if a word or phrase is being used as a noun, adjective or verb.

With just the name of a suspect, law enforcement can view their followers on Twitter, read Facebook wall posts of the suspect and their friends to determine whether the suspect and the people they are associated with on social network sites are a potential threat.

The company 3i-Mind, based in Switzerland, pitched its product, called OpenMIND, at a law enforcement conference in San Diego last year. OpenMIND “automatically finds suspicious patterns and behaviors” across the Internet. It looks at social networks, but the program also goes through blogs, online forums and chat rooms.

http://www.homelandsecuritynewswire.com/dr20120905-lawenforcement-agencies-eager-for-websurveillance-tools - 64k -

Comment by Skroodle
2013-03-03 10:57:42

Pre-Crime.

What is the penalty for a crime you did not commit?

Comment by hazard
2013-03-03 12:01:48

“and that has law enforcement agencies eager to acquire their own tools to track people who might be planning or thinking about taking out their frustrations on other citizens.”

Track people who might be planning or thinking? That narrows it down to like fuqing everybody. Of course this comes from homelandsecuritynewswire so it wouldn`t be everybody would it.

April 15, 2009
By: Dave Workman

A controversial nine-page “assessment” issued earlier this month by the Department of Homeland Security (DSH) was like gasoline on a fire, as already-angry taxpayers have now been essentially linked at the hip to white supremacists and “violent antigovernment groups.”

The DHS document, titled Rightwing Extremism: Current Economic and Political Climate Fueling Resurgence in Radicalization and Recruitment

This DHS report – which used the term “rightwing extremists” 26 times, as if to pound the term into the vocabulary of everyone who was initially supposed to have read this document – is the kind of fear mongering that the Left has traditionally blamed on people like Rush Limbaugh, Sean Hannity and others with whom it disagrees. It was prepared by the DHS Office of Intelligence and Analysis (I&A), and its existence has people wondering just what kind of agency is being run by Janet Napolitano, former anti-gun Arizona governor who once worked in the Clinton Justice Department.

“Proposed imposition of firearms restrictions and weapons bans likely would attract new members into the ranks of rightwing extremist groups, as well as potentially spur some of them to begin planning and training for violence against the government. The high volume of purchases and stockpiling of weapons and ammunition by rightwing extremists in anticipation of restrictions and bans in some parts of the country continue to be a primary concern to law enforcement.

http://www.examiner.com/article/homeland-security-s-outrageous-insult-to-veterans-conservatives-and-firearms-owners - 103k

Comment by Northeastener
2013-03-03 15:16:28

At what point does the government stop being accountable to the people? I don’t particularly care if the government labels me a right-wing anything because I know many, many people with views just like mine. If Homeland Security thinks I and people like me are a threat to the government, I would respond by saying people like me view the current administration and the left in general as a threat to our liberty and the freedom this country was founded on.

The bottom line is Democrats have been waging war against our liberty for years. If they succeed in pushing their agenda, including reducing the 2A to a by-line in some old, document, there will be repercussions. It’s that simple.

The right of the people to keep and bear arms shall not be infringed.

Molan Labe

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Comment by Pimp Watch
2013-03-03 19:00:16

You’re a partisan douche bag just like the other partisan douche bags.

 
 
 
 
Comment by ecofeco
2013-03-03 14:48:12

“Law-enforcement agencies eager for Web-surveillance tools”

Besides the issue of privacy, this is just stupid.

How hard is it to search Facebook? Seriously?

Translation = BIL deals for the companies named.

Comment by spook
2013-03-03 18:20:17

They are making the haystack bigger in order to spend more time and money searching for needles.

Comment by ahansen
2013-03-03 21:57:04

Bravo.

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Comment by goon squad
2013-03-03 05:53:20

Comment by Ben Jones
2013-03-02 20:43:05

‘the DHS’ purchase of 2 billion bullets’

Since the recent mass shootings and subsequent furor about guns, the citizens have spoken. They purchased millions of firearms and who can say how much ammo. So if the Feds want a war, they’ve got one.

Comment by eight pieces of chicken
2013-03-03 08:49:16

Every man, woman a child gets 6 bullets per person. I think dhs needs more. i don’t trust thier shooting skills.

Comment by ann gogh
2013-03-03 09:07:50

I’d rather die from eating too much and just explode internally.

Comment by inchbyinch
2013-03-03 09:29:46

ann gogh
Yikes, that morning visual was ugly.

On the lighter side:
Forget love.
I rather fall in chocolate.

(I have this sign on my front porch. It makes people laugh.)

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Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 12:33:14

“I rather fall in chocolate.”

My son is involved in a HS production of Willy Wonka and the Chocolate Factory this weekend. One of the characters in the story literally does fall in chocolate…

 
 
 
 
Comment by In Colorado
2013-03-03 09:43:08

So if the Feds want a war, they’ve got one.

Yeah, right. Where were all the self styled patriots when the DHS was formed or when the NDAA was overwhelmingly passed by congress and signed into law?

Nothing but posturing. As soon as the power gets cut and there’s no fuel for the truck and the shelves are bare at Walmart they’ll fold like a house of cards.

Comment by hazard
2013-03-03 09:54:44

“As soon as the power gets cut and there’s no fuel for the truck and the shelves are bare at Walmart they’ll fold like a house of cards.”

Where’d you find the playbook?

“they’ll fold like a house of cards.”

Very telling.

There are no red states or blue states, there is just us and them and as soon as the power gets cut and there’s no fuel for the truck and the shelves are bare at Walmart they’ll fold like a house of cards. FORWARD!

 
Comment by Bill in Los Angeles
2013-03-03 10:02:47

Many of these patriots believed GWB and Democrat Hillary in testifying on the Iraq WMDs. We were fooled. By 2006 I was sorry I voted for GWB in 2004. How many times do we have to apologize? We’ve moved on. I became alienated from my 2001-2004 admiration of the RP. I voted as a registered libertarian in 2012. Voted for Ron Paul (write in) in 2008.

So you are barking up the wrong tree about “patriots”

We want the “Patriot” act repealed. We want to abolish TSA and NDAA. Many of us are so anti-state, we became voluntaryists and are focusing on building up cash, gold, silver, guns, and ammo. We are sickened about post-2000 militarism as opposed to the cold war days of the late 70s and 80s. More and more of us are fearing this stuff will be used on us. Even ex military are on the threat list of DHS. How sick is that?

Comment by Skroodle
2013-03-03 11:01:27

Patriots that’s listen to Hillary Clinton??

What color are the clouds in your world?

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Comment by Bill in Los Angeles
2013-03-03 11:12:37

School marm is such a patriot, in favor of the military thugs as long as the CIC is a democrap. You’d be surprised. DOD has its share of leftist fascists who like the police state.

 
Comment by MacBeth
2013-03-03 11:57:39

There are several people here who enjoy the police state as long as it supports their political view.

A few months back I was told that was a “good”, “reasonable” spokesman for the “loyal opposition”.

That ended abuptly when it was learned that I equate Neocons and Progressives.

Suddenly, I was an unreasoned idiot. How dare I draw obvious parallels between the two.

I guess if you play in the other persons pre-defined playbook, you can be a “reasonable loyal oppositionist”. If you step out of their box, you are a jerk.

Interestingly, that’s a common reaction among NeoCons and Progressives alike. A hankering for a compassionate police state at the extent of individual liberty is yet another thing Progressives and Neocons have in common, apparently.

It’s not surprising that Neocons and Progressives actually like one another. Their 3-decades long interaction at the top has had the net result of making the three Washington DC collar countries the very wealthiest across all the land.

How much you wanna bet that no sequester is about to change that fact anytime soon?

Once you step out of their box or premises, game over.

 
Comment by RioAmericanInBrasil
2013-03-03 12:05:45

That ended abuptly when it was learned that I equate Neocons and Progressives.

What ended abruptly might have been your credibility if what you say resembles what you write.

 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 12:55:33

“Suddenly, I was an unreasoned idiot.”

Who offered that opinion, aside from yourself?

 
Comment by MacBeth
2013-03-03 13:43:28

Cantankerous,

Again, I do not wish to name that individual (a different person this time), but it has been said.

I come here to discuss ideas. Sometimes heatedly. Sometimes not. Sometimes humorously (hopefully).

Sometimes I’m right. Sometimes I’m wrong. That’s how it works.

Thanks.

 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 18:12:13

“Sometimes I’m right. Sometimes I’m wrong. That’s how it works.”

Fair enough, and same here…

 
Comment by ahansen
2013-03-03 22:11:33

Apples and oranges are both fruits.

 
 
Comment by ecofeco
2013-03-03 14:52:50

“We want the “Patriot” act repealed. We want to abolish TSA and NDAA…

…We are sickened about post-2000 militarism as opposed to the cold war days of the late 70s and 80s. More and more of us are fearing this stuff will be used on us. Even ex military are on the threat list of DHS. How sick is that?”

On this I can agree with you 100%.

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Comment by In Colorado
2013-03-03 15:12:47

We want the “Patriot” act repealed. We want to abolish TSA and NDAA.

So where were they with their shiny unregistered gun show rifles when that first happened? They sat on their hands then and they will do the same in the future, while they congratulate each other over their “patriotism”.

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Comment by hazard
2013-03-03 16:18:04

“They sat on their hands then and they will do the same in the future,”

I wouldn’t count on that.

 
 
 
 
 
Comment by goon squad
2013-03-03 06:12:45

DHS built domestic surveillance tech into Predator drones:

“The U.S. Department of Homeland Security has customized its Predator drones, originally built for overseas military operations, to carry out at-home surveillance tasks that have civil libertarians worried: identifying civilians carrying guns and tracking their cell phones, government documents show.

The documents provide more details about the surveillance capabilities of the department’s unmanned Predator B drones, which are primarily used to patrol the United States’ northern and southern borders but have been pressed into service on behalf of a growing number of law enforcement agencies including the FBI, the Secret Service, the Texas Rangers, and local police.

Homeland Security’s specifications for its drones, built by San Diego-based General Atomics Aeronautical Systems, say they “shall be capable of identifying a standing human being at night as likely armed or not,” meaning carrying a shotgun or rifle. They also specify “signals interception” technology that can capture communications in the frequency ranges used by mobile phones, and “direction finding” technology that can identify the locations of mobile devices or two-way radios.

The Electronic Privacy Information Center obtained a partially redacted copy of Homeland Security’s requirements for its drone fleet through the Freedom of Information Act and published it this week. CNET unearthed an unredacted copy of the requirements that provides additional information about the aircraft’s surveillance capabilities.”

http://news.cnet.com/8301-13578_3-57572207-38/dhs-built-domestic-surveillance-tech-into-predator-drones/

Comment by Pimp Watch
2013-03-03 07:21:06

Evil men, doing evil things, in spite of the Constitution and Bill of Rights, as imperfect as those documents are.

Comment by MacBeth
2013-03-03 09:44:49

The Constitution, and all Founding Fathers, are and were evil.

And they have always been and forever shall be. And don’t you ever forget it.

How do I know this to be true?

Neocons and Progressives alike tell me so. Their actions tell me so. They are Compassionate. You, Pimp, are not.

Follow me as I pay ideologic homage to Our Lady Michelle, Neocon-Progressive Princess Extraordinnaire:

…for only now, with a Black Man and Black Woman at 1600 Pennsylvania can we begin to feel any pride for our country. Until now, the United States has accomplished nothing admirable…

Comment by XGs-fixr
2013-03-03 11:05:48

Everybody wants the illegals from Mehico caught, but God forbid anyone from using a flying camera platform to do it…….

Manned aircraft have been pulling surveillance for years, but its dumb drones that get peoples panties in a wad…..

That ship has sailed. In fact, Im thinking the government is dragging out the “drone threat” to distract peoples attention from something else.

This assumes that the government is smart, contrary to all of the other evidence

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Comment by MacBeth
2013-03-03 12:06:40

You could very well be right, X-er.

A drone certainly removes the need for citizens to have guns, doesn’t it? We no longer will need guns to ensure our safety, what with government drones doing that task for us. Right?

 
Comment by Skroodle
2013-03-03 12:36:16

Wait until government agency turns on government agency. A little inter-agency war will be bad.

The whole FBI vs CIA in the Petreaus Afair was the tip of the iceberg.

 
Comment by MacBeth
2013-03-03 14:01:49

Skroodle -

That’s crossed my mind as well and could become a scary proposition, especially if you’re a federal employee or contractor. If I were a federal worker, it is that which would represent my biggest fear.

The liklihood of that scenario playing out, though, I can’t imagine being anything but miniscule. As long as the fat cats are well fed and happy, they won’t turn on each other.

The sequester is nothing. A few might lose their jobs or get a pay cut, but the long-term ramifications won’t be much, at least monetarily (for them). The Washington-area will remain the wealthiest in the country.

The sequester might end up helping those of us in the private sector, as the proportion of money lost in non-productive government endeavors lessens a tad bit in favor of more money being put to work in productive endeavors.

Remember that which government dislikes generally is good for the economy relative to production.

 
 
Comment by RioAmericanInBrasil
2013-03-03 11:38:28

…for only now, with a Black Man and Black Woman at 1600 Pennsylvania can we begin to feel any pride for our country.

Preach it bro! After Obama was elected, Brazilians and tourists from around the world were much nicer to me being an American. The respect level rose.

GWBush really made America look bad in the world’s eyes.

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Comment by MacBeth
2013-03-03 12:29:07

I don’t worry about receiving respect from former slave-holding Brazilians.

I find it amusing that above-the-fray Brazilians cast judgment upon American blacks who are among those currently funding the ongoing development of Brazil’s offshore oil industry.

I don’t think American blacks would be all that pleased to learn that they are picking cotton for the benefit of plantation-owning Brazilians and George Soros.

How does one translate “let them eat cake” into Portuguese?

 
Comment by alpha-sloth
2013-03-03 15:43:36

…for only now, with a Black Man and Black Woman at 1600 Pennsylvania can we begin to feel any pride for our country.

Preach it bro!

+1 MacBeth is doing a great job today of showing why the GOP won’t be winning many national elections in coming years, maybe decades.

 
 
 
 
Comment by hazard
2013-03-03 13:17:16

“Homeland Security’s specifications for its drones, built by San Diego-based General Atomics Aeronautical Systems, say they “shall be capable of identifying a standing human being at night as likely armed or not,” meaning carrying a shotgun or rifle”

Nothing to see here. After all it`s not like they can arm those drones or anything and you have to be given due process if you are an American citizen, right?

Now if you will excuse me I will get back to watching the video of the Jan 25, 2013 local news coverage of diving Blackhawks firing blank rounds of machine gun fire while on strafing runs, troops rappelling from choppers and road blockades in Miami.

Attack Helicopters Let Loose with Machine Gun Fire Over … - Infowars
http://www.infowars.com/attack-helicopters-let-loose-with-machine-gun-fire-over-miami/ - 52k - Cached - Similar pages

Comment by hazard
2013-03-03 17:54:56

Black Hawks Used In Military Training Exercise In Miami « CBS Miami
http://miami.cbslocal.com/2013/01/25/blackhawks-used-in-military-training-exercise-in-miami/ - 126k - Cached - Similar pages
January 25, 2013 8:34 AM

 
 
 
Comment by palmetto
2013-03-03 06:40:19
Comment by In Colorado
2013-03-03 09:45:42

It’s all about keeping wages down.

Comment by ecofeco
2013-03-03 15:07:49

Period.

 
 
Comment by Skroodle
2013-03-03 11:09:24

O-1 visas are used for extraordinary ability in the sciences, education, business, or athletics.

 
Comment by cactus
2013-03-03 20:59:18

As a result of the overwhelming influx, Matloff argues that foreign immigrants became a kind of “indentured servant,” forced to work for lower pay and less legal protections (a concern also expressed by industry unions).”

until they get thier green card. plus if the boss is foriegn he or she well no just he will get more respect from workers from his own hood

like they will stand up when boss comes to the meeting room

 
 
Comment by azdude
2013-03-03 06:53:58

was bank of new york mellon in bed with the tan man?

 
Comment by Combotechie
2013-03-03 07:16:43

I ran across an interesting blogspot:

“Frankenstein Government”

http://thecivillibertarian.blogspot.com/#!/

Comment by inchbyinch
2013-03-03 09:25:14

Combo
That was a great find. Thank You!

What I thought was bs, evidently isn’t. I really liked his comment (in the video on new laws) is that it’s worse that Obama is a Constitutional Lawyer, whereas W is a Moron, pertaining to the stripping of innocent until proven guilty and govt camps. I’ll be following the Supreme Court’s decision (if it gets there).

 
 
Comment by Pimp Watch
2013-03-03 07:17:31

Looming Sequestration Cuts Will Hit D.C. the Hardest
By Roy Oppenheim
March 1, 2013

With so many federal workers living in and around our nation’s capitol, those federal spending cuts will eventually translate to job cuts and unpaid mortgages.

The dreaded sequestration deadline has arrived, and with it $85 billion in automatic spending cuts that could plunge the nation’s strengthening economy back into the depths of recession.

(For some light reading on the topic, check out the 394-page Office of Management and Budget report.)

But contrary to many media reports, the majority of spending cuts will be felt most acutely in the federal government’s hometown: Washington, D.C., a region that, ironically, suffered the least in the economic downturn.

While most of the rest of the country’s housing market suffered during the recession—with foreclosures becoming the rule instead of the exception—the Beltway has had one of the strongest housing markets in the country.

Having visited the area during the economic crisis, it always struck me as odd how little suffering there seemed to be there compared to the rest of the nation, and in particular Detroit, Arizona, Las Vegas, and of course Florida.

But with so many federal workers living in and around our nation’s capitol, those federal spending cuts will eventually translate to job cuts, unpaid mortgages and … well we all know how that story has gone.

In short, there’s some belt tightening on the way for many of those inside the Beltway.

That’s not to say others around the country won’t be impacted. Earlier this month, HUD Secretary Shaun Donovan warned if the cuts go forward, the Federal Housing Administration won’t be able to help those trying to dig their way out of foreclosures, purchase a home, and generally stabilize the housing market.

http://www.usnews.com/news/blogs/home-front/2013/03/01/looming-sequestration-cuts-will-hit-dc-the-hardest

As the next leg down resumes in cities like DC, NYC and Boston, watch for the DebtorDeniers and others who have a stake in the direction of prices come out of the wood work with their elaborate lies.

Comment by MacBeth
2013-03-03 11:17:04

Yes.

It’s all so ironic.

What’s missing from the piece is that the U.S. Government has yet to realize that its source of “income” (i.e., other people’s money) is rapidly running dry.

There should be much more personal worry in Washington. Not about “sequester”. But about what is happening to everyone who is not government. They should worry about incomes dropping nationwide, about 15%+ real unemployment, about massive student debt.

Quite naturally, none of that means anything to them. Until it does.

“Compassionate” is a much-heralded word among government workers. Neocons and progressives love it. They all Feel Your Pain. It allows them to take your money, malinvest it at will, and excuse themselves in the process.

So much malinvested money that now, for example, Government=Housing. Guys, government MUST support housing in all manner possible, even if the greater population suffers greatly over several decades.

You need to understand that you don’t matter.

If the population at large withers to a point of economic depravity, so be it. But Government must not. Hence, all the ongoing and incomprehensible lies and actions taken by government on all things housing. Worthless programs, insufficient enforcement, hidden inventory.

All the while, the counties surrounding D.C. become THE wealthiest counties in the nation. All the while, your incomes continue to drop.

An expanding government must tell more lies to justify itself.

A shrinking government needs to tell fewer lies to justify itself.

Which do you want? Which do you want for your kids?

Comment by Bill in Los Angeles
2013-03-03 13:41:05

All the more important to have been building up a substantial part of your net worth in movable, hidable assets. For combo and cantankerous, stacks of hundred dollar bills. I also approve of “cash under the mattress” but I approve of precious metals more.

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 13:43:41

“All the more important to have been building up a substantial part of your net worth in movable, hidable assets. For combo and cantankerous,…”

We all do, without making any investment moves, in the form of our human capital. If we needed to move somewhere else and start over, there is a good chance we could offer something of value to another economy from the one in which we currently make our livings to gain a foothold on a new life.

Of course, a little extra cash to buffer the effort is also a good idea…

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Comment by Bill in Los Angeles
2013-03-03 19:48:25

My equities stake has grown well. I did not expect this year to do well so far these first two months. At this point my asset allocation in precious metals is below my target percentage. I’ll put it this way: I’m $23,000 (priced at today’s USD) below my comfortable level in gold.

Since my habit is to buy small amounts in equal intervals of time rather than buy all at once (objective allocation, rather than emotional allocation), not sure if I will catch up to my ideal asset allocation within the next twelve months unless the stock market takes a big hit.

 
 
 
Comment by ahansen
2013-03-03 22:23:30

Seriously asking here:

Name one “progressive” in the federal government (besides, maybe Bernie Sanders who is a self-described Socialist.)

 
 
 
Comment by hazard
2013-03-03 08:30:20

And now for our next major breaking U.S. news story.

http://www.youtube.com/watch?v=F-t8PngHgWY - 200k -

Comment by palmetto
2013-03-03 13:53:28

Awesome, jeff. That bought a smile to my face. I love Daffy and Bugs. When I was a pup, I wanted to hang out with them. I was so disappointed when I found out they were cartoon characters, not real beings.

 
 
Comment by AbsoluteBeginner
2013-03-03 08:56:16

Is it fair to say there is a very high correlation between house prices and the Federal Reserve’s interest rate settings? I believe the general market sets long term rates and mortgage rates fall in line with that channel. Spikes in housing prices through periods of time, as well as drops in prices, generally can be attributed to Fed money policy though?

Also, the market is consistently looking for return on an investment dollar IMHO. How has housing become part of that quest?

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 12:50:23

“Is it fair to say there is a very high correlation between house prices and the Federal Reserve’s interest rate settings?”

Ben Bernanke has proclaimed from his bully pulpit that this isn’t the case. I guess he doesn’t believe the predictions of the basic asset pricing model used by every financial economist in the world, which is an inverse relationship between interest rates and equilibrium asset prices.

Low rates raise house prices

Shane Wright Economics Editor, The West Australian
Updated March 2, 2013, 2:00 am

Fresh signs are emerging the housing sector is finally responding to low interest rates, with house prices across the country lifting through February.

RP Data-Rismark reported yesterday house values rose 0.2 per cent last month to be 1.3 per cent higher through the quarter.

In WA, house values edged down 0.7 per cent but still stood 1.4 per cent higher over the past three months. Over the past year they are 3.9 per cent stronger, the second best market in the nation behind Darwin.

The units sector took a bigger hit, with values down 2.1 per cent to be off 2.6 per cent over the quarter. Units have struggled in the face of increased interest in detached houses with prices up 1.5 per cent over the past 12 months.

Rismark’s Ben Skilbeck said there had been a definite turnaround across the housing market.

“In an environment of significantly improved consumer confidence, the housing market is responding positively to almost record low monetary policy settings,” he said. The higher prices are on top of better auction clearance rates plus a fall in the number of vendors being forced to cut their asking prices to swing a sale.

 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 09:43:19

San Diegans needn’t worry about the sequester, as the local fishwrap has offered its assurances that the impact will be minor compared to those of the Great Recession or the early-1990s defense cuts.

I’m always very impressed by economists who have the prescient ability to compare the impacts of events which haven’t yet occurred to those which have.

BUDGET CUTS TO DEFENSE WILL STING, BUT S.D. HAS SEEN WORSE

Experts: Great Recession, aerospace slowdown in ’90s hit harder than sequestration
By Jonathan Horn
12:01 a.m.March 3, 2013
Updated 8:08 p.m. March 2, 2013

San Diego’s defense industry makes it a magnet for federal spending.

But it also makes it especially susceptible to the spending cuts that began Friday under sequestration.

The cuts make up a very small portion of the federal budget, but San Diego will feel them more than other parts of the country because it has received more defense dollars relative to its size. In 2010, the latest year available, $37 billion federal dollars flowed into the county, up from $19 billion in 2000.

Still, the effects of the cuts will pale in comparison to other economic events, such as the Great Recession or the downturn after the decline of the aerospace industry in Southern California in the 1990s, local economists say.

Nationally, $85.4 billion in across-the-board spending cuts kick in through the rest of the fiscal year. The cuts are coming because the federal government is spending more money than it’s taking in, and some are concerned that carrying a large deficit is bad for the country’s economy.

Overall, the country could see $1.2 trillion in planned federal cuts over the next 10 years. That may sound like a lot, but it accounts for 2.6 percent of the federal budget.

“It’s just not that big,” said Marney Cox, chief economist at the San Diego Association of Governments. “You hate to say that when somebody is going to lose their job. It’s big to them. There will be some impact but not a substantial impact — it won’t be like the last recession, when we lost 103,000 jobs.”

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 12:35:51

“In 2010, the latest year available, $37 billion federal dollars flowed into the county, up from $19 billion in 2000.”

With a near-doubling of federal dollars flowing into San Diego County since 2000, it’s no surprise that our real estate market held up much better during the Great Recession than did those in other parts of the country.

 
 
Comment by Michael Viking
2013-03-03 10:01:15

This is just the kind of thing I was recommending last week:

Swiss voters approve tough limits on bosses pay

BERLIN (AP) — Swiss voters voiced their anger at perceived corporate greed Sunday by approving a plan to boost shareholders’ say on executive pay.

Some 67.9 percent of voters backed the “Rip-Off Initiative,” with 32.1 percent against, according to the official count broadcast by Swiss public television station SRF.

I hope this kind of idea takes off. CEOs and their board being in bed with one another and scratching each others’ backs at the expense of the common shareholder and employee is ridiculous.

This was my favorite part of the article: Opponents conceded that their efforts to warn voters of the possible risks to the Swiss economy had failed. I imagine the Swiss stuck out their hands, shook them a little and said “eeewwwww, I’m scared…”

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 12:37:17

So is it safe to assume we will soon see top Swiss bankers applying for jobs in relatively unregulated markets, like Manhattan and London, where they can earn the full market value of their talents?

Comment by vinceinwaukesha
2013-03-03 14:32:55

there’s no labor mobility or free market.

If there was, as one of the highest exec pay countries in the world, you’d assume if ability and intelligence are distributed smoothly, the local execs sex, racial, ethic, religious, etc background would be the same as the world average. Yet oddly enough the local execs are massively over represented by old white men. If, say, our own women don’t have a chance at 51% representation here, I highly suspect some random swiss dude doesn’t stand the slightest chance.

One swiss dude might move. But individual anecdotes are not going to matter. Overall they’ll sit there and take it, just like homeowners or J6P or xian 6 pak or whatever. They’re just slightly richer peasants / bubbas.

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 18:10:15

“…there’s no labor mobility or free market.”

In other words, the international banksters’ claim that regulations will lead to talent flight is just a steaming pile of BS…

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Comment by ahansen
2013-03-03 22:26:13

Commie.

 
 
Comment by Housing Analyst
2013-03-03 12:09:37

“Why buy a house now when prices are falling? Rent for half the monthly cost and buy later, after prices crater, for 65% less.”

Comment by alpha-sloth
2013-03-03 16:04:54

How much later?

 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 12:46:41

Since the Republicans have taken tax increases off the sequestration bargaining table, how about taking another look at wasteful tax breaks for the wealthy?

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 12:51:55

Is the Mortgage Interest Deduction Impeding Home Ownership?
by Jann Swanson
Feb 27 2013, 9:07AM

The Hamilton Project, an economic policy initiative at the Brookings Institution, invited 15 economists of different philosophies to submit proposals for rethinking the Federal Budget. In the eighth of the resulting papers Alan Viard, Resident Scholar, American Enterprise Institute, proposed to replace the mortgage interest deduction with a refundable credit to reduce the artificial incentive for the construction of high-end homes by better targeting the tax breaks for housing.

Viard says current tax policy offers unwarranted subsidies for the purchase of expensive homes by high-income taxpayers, but does little to promote homeownership by those of more modest means. He contends that, in addition to the actual mortgage interest deduction, homeowners receive an additional benefit from the tax code in the form of an exemption from tax on imputed rent.

Imputed rent is value of housing services provided by an owner-occupied home as measured by the cost of obtaining the same services from a rental property. Viard says to maintain neutrality with respect to the current taxation of business capital; the tax system would need to tax homeowners on this return while allowing a deduction for the associated costs, including mortgage interest payments. Instead, under the current tax system the homeowner gets the best of both worlds, paying no taxes on imputed rent but yet still deducting mortgage interest payments.

Taxpayers who itemize deductions rather than taking the standard deduction may deduct the interest paid on up to $1 million of mortgage debt plus up to $100,000 of home equity loans. Mortgage interest on a second home may also be deducted as long as the total remains within the dollar limits. Essentially the same rules apply under the alternative minimum tax, except that home equity loan interest cannot be deducted.

Viard said the mortgage interest deduction would be allowed under a neutral tax system but not the tax exemption for imputed rent. He provides the following example, breaking the tax advantage into two components, one of which is linked to mortgage interest.

“Suppose that a taxpayer who itemizes deductions and is in the top 39.6 percent bracket (rounded to 40 percent for simplicity) owns a home worth $1.5 million with a $1 million mortgage. If the home provides a 5 percent rate of return in terms of housing services and the mortgage rate is also 5 percent, then the taxpayer receives $75,000 of imputed rent and pays $50,000 of mortgage interest. Under a neutral tax system, the homeowner would pay $10,000 of tax on imputed rent minus mortgage interest; under the current tax system, the homeowner actually receives a $20,000 tax saving from deducting the mortgage interest. The $30,000 total tax advantage provided by the current tax system, which is equal to 40 percent of the imputed rent, can be broken down into a $20,000 benefit from the mortgage deduction and a $10,000 benefit from the failure to tax imputed rent minus mortgage interest.”

The Treasury Department classified the mortgage deduction as a $111 billion tax expenditure and the failure to tax imputed rent minus mortgage interest as a $59 billion tax expenditure for fiscal 2014.

 
Comment by Bill in Los Angeles
2013-03-03 13:43:23

I prefer the abolition of the sixteenth amendment and put a fork in the 100 years of “progressivism.”

Comment by alpha-sloth
2013-03-03 16:19:11

put a fork in the 100 years of “progressivism.”

The 100 years that saw us become the wealthiest most powerful country in history? When we faced down evil dictatorships around the world and reformed them into peaceful democracies? When we cleaned our cities’ air of smog and our gasoline of lead and our food chain of DDT? When civil and voting rights were expanded to include the majority of our population? When our standard of living and our life expectancy both increased greatly, and infant mortality rates decreased greatly?

That 100 years of progressivism?

Comment by ahansen
2013-03-03 22:30:50

Relax, alpha. They’re on their new buzz word-of-the-month. At least they’ve retired “statist”.

Coming up: “voluntaryists”.

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Comment by Ben Jones
2013-03-03 23:21:58

‘They’re on their new buzz word-of-the-month. At least they’ve retired “statist’

“They”. Hmmm, that’s interesting. When it comes to terms, you either are or you aren’t.

‘In political science, statism (French: étatisme) is the belief that a government should control either economic or social policy, or both, to some degree…The term statism is sometimes used to refer to market economies with large amounts of government intervention, regulation or influence over a market or mixed-market economy. Economic interventionism asserts that the state has a legitimate or necessary role within the framework of a capitalist economy by intervening in markets, attempting to promote economic growth and trying to enhance employment levels.’

‘Although this intervention may be undertaken in the name of the public interest, in many instances unintended consequences may ensue, to the opposite of those good intentions. For example, in one interpretation, the USA promoted the Federal National Mortgage Administration (FNMA) as a cure for widespread home ownership; however, coercion of banks to lend to multitudes of unqualified buyers, accentuated with unintended trading of the financial derivatives of these mortgages, led to a dramatic collapse of the housing market in the USA in the period 2008 to 2012.’

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

I’ve always found it interesting when people run away from their positions. I mean really, if you are a socialist, just say so. They do in Europe or South America. If you are a marxist just say it. It’s not like you are fooling anybody. And if you subscribe to statism, just admit it, proudly.

 
Comment by ahansen
2013-03-04 00:20:29

Is anyone on this blog really an Anything?

These terms are so vague and so interwoven (and so issue-driven) that they’re simply divisive, (which, I suspect, is “their” point of using them here, and why I sometimes call “them” out for encouraging dis-civility in our discourse.)

While labels may suggest a general ideology, pretty much everyone who posts here is somewhere on a continuum, rendering these terms useful only for stereotyping and baiting.

No one wants “The State” interfering in people’s private affairs, until they do. See, for example, one oft “conservative” poster who’s touting salary limits for CEO’s. Or one libertarian who gleefully works for defense contractors. Or one anarchistic apologist for civil order and social (oh, here comes another buzzword) “compassion”, er pragmatism. ;-)

Although I generally use “They” ironically, on this occasion I did it as a courtesy (to you, mostly) to avoid calling out individuals I didn’t care to rattle this late in the evening. Personally, I enjoy alpha’s posts, and although I don’t necessarily agree with him, he does post thoughtful, fact-based arguments, and I get good information from him. As I do NE, MacBeth, and Rio. And you.

 
 
 
 
Comment by Michael Viking
2013-03-03 16:16:56

Since the Republicans have taken tax increases off the sequestration bargaining table

I think they did this in response to the other team taking spending cuts off the table.

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 18:08:47

“…the other team taking spending cuts off the table.”

Are you lying, or merely misinformed?

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 18:20:53

I have little patience for lying, whether or not it is intentional. The debate is sufficiently muddled without throwing propaganda into the mix, whether due to ignorance or deliberate deception.

Obama renews budget offer to cut social safety nets
By Richard Cowan
WASHINGTON | Sun Mar 3, 2013 6:03pm EST

(Reuters) - President Barack Obama raised anew the issue of cutting entitlements such as Medicare and Social Security as a way out of damaging budget cuts, a White House official said on Sunday, as both sides in Washington tried to limit a fiscal crisis that may soon hit millions of Americans.

Signaling he might be ready to explore a compromise to end automatic spending cuts that began late Friday, Obama mentioned reforming these entitlement programs in calls with lawmakers from both parties on Saturday afternoon.

“He’s reaching out to Democrats who understand we have to make serious progress on long-term entitlement reform and Republicans who realize that if we had that type of entitlement reform, they’d be willing to have tax reform that raises revenues to lower the deficit,” White House senior economic official Gene Sperling said on Sunday on the CNN program “State of the Union.”

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Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 19:03:08

What is it, Michael — are you a liar, or just an ignoramus? (Just a question, no ad hominem attack intended…)

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Comment by Michael Viking
2013-03-03 19:30:10

Just a question, no ad hominem attack intended…

LOL!

Looks like the republican negotiation strategy worked pretty well! I thought you said it was pathetic?

Tell me about what Obama was saying in December around the time of the first “crisis” that postponed some things until this “crisis”…

 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 21:10:16

Dude, just don’t spread lies here. Though I take no pleasure in pointing them out, I intend to continue doing so as along as you keep posting them.

 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 21:11:17

“I thought you said it was pathetic?”

You are averaging just under one lie per post.

 
 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 19:24:33

It looks to me like the Democrats are proposing a mix of spending cuts and revenue increases, and the Republicans are drawing a line in the sand at no revenue increases.

Seeking Compromise, President Reaches Out to the Rank and File

By JONATHAN WEISMAN
Published: March 3, 2013

WASHINGTON — With few avenues left for winning a comprehensive budget deal that can reverse the across-the-board spending cuts that took effect over the weekend, President Obama has begun reaching out to senators in a bid to isolate Republican leaders in Congress and force a compromise.

In conversations last week with Senators Lindsey Graham of South Carolina and John McCain of Arizona, both Republicans, and in a wider outreach to rank-and-file members of Congress that a top White House official said began this weekend, Mr. Obama hopes to build a broad consensus on deficit reduction that includes new revenue, despite the uncompromising stance of Republican leaders in the House and the Senate.

“Our hope is that as more Republicans start to see this pain in their own districts, that they will choose bipartisan compromise over this absolutist position,” Gene Sperling, the director of the president’s National Economic Council, said Sunday on the NBC program “Meet the Press.”

 
 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 13:00:54

At this point, sequestration looks like a lose-lose political stalemate with no resolution in sight.

Financial Times
March 3, 2013 7:27 pm
A taste for mutually assured destruction
By Edward Luce
US sequestration looks likely only to entrench the partisanship it was supposed to circumvent

When Congress and the White House started the sequestration clock in August 2011, people called it the nuclear option, since it would never be allowed to happen. Anything would be better than the indiscriminate spending cuts it would trigger. “It was done to be sort of like, in Dr. Strangelove, the bomb that goes off,” said Ben Bernanke, chairman of the US Federal Reserve. On Friday it went off and the Dow closed 35 points higher. Some nuclear option. What would the stock markets do if Congress agreed?

Alas, the question is hypothetical. The logic of the sequestration was that Republicans would be hit by blind cuts to the Pentagon budget – something it was thought inconceivable they would tolerate. And Democrats would get yet more reductions in their civilian spending priorities. The point was to ensure it was worse than the alternatives. But both sides have concluded it is better. Whoever first proposed this cunning sequestration, partisan loathing has only got worse.

Given the depths of antipathy – not least between President Barack Obama and John Boehner, the Republican House Speaker – perhaps only a real nuclear option would work. Failure to legislate would trigger a simultaneous nuclear launch on San Francisco, cultural capital of the Democrats, and Salt Lake City, a Republican bastion. Should that fail, it would be followed by multiple strikes on red and blue states alike until the public became so angry Washington had to act.

In the event, the $85bn sequestration looks likely only to entrench the partisanship it was supposed to circumvent. Mr Obama’s ultimate goal is to win back control of the House of Representatives in the 2014 midterm elections, which would give him two years to make a dash for history. With Congress back in full Democratic control he could tackle global warming, enact genuine gun control and achieve other currently unreachable goals. In American football terms, Mr Obama is playing for the fourth quarter.

The sequestration offers him a no-lose political proposition. In recent days Republicans toyed with giving the president discretion over how the cuts were administered – a scalpel rather than a meat cleaver. He dismissed such talk. Democrats believe the sequestration sets them up for a rolling public relations coup.

Either the Republicans will cave in and agree to get rid of special tax breaks for the wealthiest Americans, which would cement Mr Obama’s headline tax victory in early January, or they will stick to their guns and prove once and for all that they hate government more than they love their country. The latter looks more likely.

Every delayed flight, every vaccination a child fails to get and every closed public park will reveal Republican callousness. As the cuts deepen – from April onwards, since the law requires 30 days notice to federal employees – the public will further appreciate how much they rely on government. Aircraft may not fall out of the sky but long security queues will raise everyone’s mercury.

The Republicans have drawn the opposite conclusions. Their goal is to ensure Mr Obama’s agenda is stalled for the next four years, which would be greatly assisted if they could regain control of the Senate in 2014. Sequestration will help push their case. Every time Mr Obama points to furloughed meat-factory inspectors or growing gaps in US-Mexico border security, Republicans will accuse him of manipulating the cuts for effect.

History says the president’s party loses midterm elections even when the economy is strong – Republicans retained control of Congress in 1998 during the height of Bill Clinton’s internet boom.

Today’s economy is a pallid imitation of the 1990s. Sequestration will shave roughly half a percentage point off growth in 2013, thus ensuring unemployment will probably still be hovering at about 8 per cent at the start of 2014.

But in practice, Republicans are betting most Americans will wonder what the fuss is about. The sequestration amounts to just 2.4 per cent of the federal budget. If Washington cannot handle a cut this small, it is surely beyond repair. “Despite a relentlessly hysterical campaign from President Obama claiming the sequester would end American civilisation as we know it, the sun still rose this morning,” said Tim Phillips, head of a leading Tea Party group, in an email to supporters on Saturday.

It is hard to see what in the next few weeks will persuade the parties that compromise is a better option.

 
Comment by Cantankerous Intellectual Bomb Thrower™
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 13:14:12

Sequester cuts get real for unemployed Americans
Ianqui Doodle / Creative Commons

The sequester will mean cuts to the unemployment checks people depend on to pay bills.

Interview by Kai Ryssdal
Marketplace for Friday, March 1, 2013

One reason House Republicans might not feel a sense of urgency about budget cuts that start today? They’re kind of abstract. No set timeline. No clear definition of who gets hit.

So you can kind of understand that, right?

Richard Crowe most definitely does not. He’s a steelworker — or, he was, until he was laid off nine months ago. He’s collected unemployment since. And federal unemployment is one of the programs being cut because of the budget cuts.

Crowe isn’t quite sure what will happen come Monday, or in the following weeks. His check is expected to get smaller by about 10 percent. That’s cutting a good $76 out of the $764 he receives from unemployment every two weeks. “It isn’t enough to begin with, and then you’re losing money on top of it. It ain’t good. I struggle to pay bills now.”

His wife works, but doesn’t make a living wage. His Plan B? Crowe continues his job search. He says he’s applied for over 200 at this point, but hasn’t had much luck.

Crowe says he’s not happy with Congressmembers from either party. “I worked my whole life. I don’t want to be on unemployment. But I don’t think the 535 people, any of them care about you.”

Comment by ecofeco
2013-03-03 15:12:59

For my last job, I had sent out 400 resumes/applications.

I can remember when 100 was more than enough to land a job.

Comment by ecofeco
2013-03-03 15:16:05

Sorry, I meant a decent job. i.e., more than min wage.

 
 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 13:38:40

Sequestration cannot stop or even slow down the bull. Buy stocks now, or get priced out forever!

Strong jobs report could lift U.S. stocks to record highs

A strong jobs report could provide the impetus for U.S. stock indexes to reach record highs.

Blue chips are on the edge of record highs, and the push they need may come from closely watched U.S. jobs figures. An indication that more stimulus in the global financial system is on the way also would help.

Comment by azdude
2013-03-03 16:31:19

r the muppets lining up to buy stocks?

 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 13:40:24

March 3, 2013, 3:36 p.m. EST
Republicans insist spending cuts will stay
Conservatives say they won’t raise taxes; Romney criticizes Obama
By Jeffry Bartash, MarketWatch

WASHINGTON (MarketWatch) — Republican leaders on Sunday insisted they won’t relent in their goal to reduce government spending or shut off a so-called sequester that will require tens of billions in cuts over the next six months and beyond.

Under a law passed two years ago, the federal government is required to slice as much as $85 billion in spending in the fiscal year that ends in September. The across-the-board cuts in defense and domestic programs began to kick in on Friday after Democrats and Republicans failed to agree on an alternative.

Democrats wanted to raise taxes again to offset some of the cuts, but Republicans ruled out any more tax increases.

“So far I haven’t heard a single Senate Republican say they would be willing to raise a dime in taxes to turn off the sequester,” said Senate Minority Leader Mitch McConnell, the Kentucky Republican, in an interview Sunday on CNN.

McConnell and House Speaker John Boehner met with Obama in the White House on Friday, but they came to no agreement in what’s become a common ritual in Washington.

Former GOP presidential candidate Mitt Romney, in his first interview since election night in November, said Obama needs to show leadership and be more willing to compromise.

“What we’ve seen is the president out campaigning to the American people, doing rallies around the country, flying around the country and berating Republicans,” Romney said Sunday on Fox News. “That causes the Republicans to retrench and to put up a wall and to fight back.”

 
Comment by Housing Analyst
2013-03-03 14:09:25

“If you bought a house 1998-2012, you’ve lost alot of money. ALOT of money.”

Comment by azdude
2013-03-03 14:19:45

if you bought and sold at the right times during that period u made a lot of money.

Comment by Housing Analyst
2013-03-03 14:57:15

“if you bought and sold at the right times during that period u made a lot of money”…….. which was a very brief time in the entire history of the US.

Comment by azdude
2013-03-03 15:30:53

you had several years of a bull market from 1998 -2012 to sell and make money.

Hogs get slaughtered.

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Comment by Housing Analyst
2013-03-03 15:44:58

….. and two centuries to lose money.

 
 
 
 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 14:15:03

If communists are hoarding gold, then I welcome policies to make its price crash. Why not strengthen the U.S. dollar and hand communists losses at the same time?

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 14:16:28

Why Are Russia And China Hoarding So Much Gold?
February 12th, 2013

Will oil soon be traded in a currency that is thousands of years old? What would a “gold for oil” system mean for the petrodollar and the U.S. economy? Are Russia and China hoarding massive amounts of gold because they plan to kill the petrodollar? Since the 1970s, the U.S. dollar has been the currency that the international community has used to trade oil around the globe. This has created an overwhelming demand for U.S. dollars and U.S. debt. But what happens when the rest of the globe starts rejecting the increasingly unstable U.S. dollar and figures out that gold can be used as a currency in international trade? The truth is that it doesn’t take a lot of imagination to figure that out. Demand for the U.S. dollar and U.S. debt would fall off the map and there would be a rush into gold unlike anything we have ever seen before. So are Russia and China accumulating unprecedented amounts of gold right now because they eventually plan to cut the legs out from under the petrodollar and they want to gobble up huge stockpiles of gold before the cat is out of the bag? Of course they will never admit this publicly, but there are rumblings out there that this is exactly what is happening.

 
 
Comment by Michael Viking
2013-03-03 16:20:42

The government has turned into a “let no crisis go wasted” club. I’m starting to think the sequester will actually cause severe issues. If nothing happens, that hurts their game plan. The government will not want to be seen as crying wolf. We must be punished so that we know they were right and to show how much we need them! Time will tell. Either way, onward to the next crisis.

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 18:07:12

“I’m starting to think the sequester will actually cause severe issues. If nothing happens, that hurts their game plan. The government will not want to be seen as crying wolf.”

Now you are talking.

And it is in Democrats’ interest to make sure the consequences of the sequester are dire. If the sequester proves benign, Republicans can claim victory in cutting the budget with no severe consequences.

 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 18:23:21

It’s a far more prudent strategy for Democrats to support the view that the pain won’t be that bad, only for it to turn out “worse than anyone expected.”

POLITICS
Updated March 3, 2013, 7:59 p.m. ET
Rhetoric Cools on Near-Term Pain of Cuts
By PETER NICHOLAS And DAMIAN PALETTA

After warning that across-the-board spending cuts would have catastrophic effects, White House officials are trying to play down fears that people will suffer hardships right away, instead preparing them for a fight that won’t be quickly resolved.

In an unsuccessful effort to get Republicans to negotiate over a more gradual deficit-reduction deal, the Obama administration spent weeks warning that the $85 billion in cuts, known as a sequester, would produce profound disruption, including teacher layoffs, flight delays, more porous borders and heightened exposure to terrorist attacks.

But it may be weeks or months before people feel the full force of the cuts. If the sequester doesn’t turn out to be as much of a burden as the president advertised, that could weaken a White House that has been portraying the Republicans as an unreasonable partner.

The administration at times has issued warnings about the spending cuts that turned out to be overblown. In a news conference last week, President Barack Obama spoke of janitors and other workers on Capitol Hill getting “a pay cut” because of the sequester. But a Capitol supervisor later told employees their pay and benefits wouldn’t be reduced by the cuts.

On Sunday, during an interview on ABC’s “This Week,” White House economics adviser Gene Sperling noted that the Capitol janitors “will not get as much overtime,” adding that “the real issue is that this is, as the president said, a slow grind.”

Still, some outside observers warned the White House may have hurt itself just as it tries to advance other policy goals and as the next budget deadline—the need to pass a bill extending routine government funding—looms at the end of this month.

“You can only cry wolf once—maybe twice. They are stuck now with over-inflating the effects and now they have a significant credibility problem,” said Lanny Davis, an attorney who specializes in crisis management and a former special counsel to President Bill Clinton.

 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 19:04:46

Crash, baby, crash!!!!

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 19:07:11

March 3, 2013, 8:50 p.m. EST
Property stocks hit Hong Kong, Shanghai markets
By V. Phani Kumar

HONG KONG (MarketWatch) — Mainland Chinese shares skidded sharply early Monday, also dragging on Hong Kong-listed stocks, as property developers took heavy losses after Beijing warned of more curbs on the sector to cool rising prices. The Shanghai Composite (CN:000001 -1.74%) plunged 2.3% to 2,305.92 in early trading, pulling down the Hang Seng China Enterprises Index 1.4% to 11,186.80 in Hong Kong, while the benchmark Hang Seng Index (HK:HSI -0.66%) fell 0.7% to 22,722.71. Shares of Gemdale Corp. (CN:600383 -9.82%) and Poly Real Estate Group Co. (CN:600048 -9.50%) dropped by the day’s 10% limit in Shanghai, after the State Council introduced stricter rules to curb speculative activity ahead of the annual session of the National People’s Congress, China’s parliament. Shares of China Vanke Co. (CN:200002 -5.38%) fell 4.9% in Shenzhen. The moves, seen as a signal Beijing won’t tolerate unaffordable home prices, dragged down shares of Hong Kong-listed developers China Resources Land Ltd. (HK:1109 -5.97%) and China Overseas Land & Investment Ltd. (HK:688 -3.90% CAOVY -2.13%) 5.5% and 3.9%, respectively. Construction-related stocks in the cement and metals sectors were also hit on mainland Chinese bourses as well as in Hong Kong.

 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 19:09:38

March 3, 2013, 8:26 p.m. EST
How shipper China Cosco sailed into rough seas
By Liu Ran and Wu Jing

BEIJING (Caixin Online) — One of the country’s most prominent liner shipping operators, China COSCO Holdings Co. Ltd., is struggling to avoid being kicked out of the Shanghai Stock Exchange five years after its debut.

It lost 6.5 billion yuan ($1.04 billion) in the first three quarters of 2012 after a 10.4 billion yuan loss the previous year. Analysts expect it to post a loss of under 10 billion yuan for all of 2012.

If it is in the red again in 2013, it will be forced to temporarily suspend trading until a profit can be turned. If losses continue for a fourth straight year, it will be delisted.

However, the chances it can turn the tide this year seem to be long. Analysts say management is more incompetent than it cares to admit. Problems have arisen because of strategic miscalculations and bungled investments with hedging tools.

The company blamed weak demand and high fuel prices, but other international shipping carriers have dealt with those challenges and not seen their bottom lines hit as badly.

COSCO Holdings is 52% owned by China Ocean Shipping (Group) Co. (COSCO Group), a state-owned shipping giant whose lines cover over more than 160 countries and regions.

It handles the majority of the parent’s important businesses, including manufacturing and shipping, dry bulk shipping, building terminals and other sea transport logistics.

COSCO Holdings went public in Hong Kong in 2005 and in Shanghai two years later, raising about 7.8 billion yuan and 15.1 billion yuan, respectively. The last year it didn’t lose money was 2010, when it posted a profit of 6.8 billion yuan.

 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 19:11:22

Feb. 27, 2013, 6:31 a.m. EST
Debunking the myth of the 8% return

One of the very basic staples of personal finance is the idea that by starting to save when young, one can become very wealthy watching their investments multiply over time. I surely agree that starting to save young is ideal, but a lot of the personal-finance literature can take things way too far. It is common to see return assumptions of 8% or higher when showing basic examples about the power of compound interest. Surely, if someone can earn 8%, planning for retirement becomes a lot easier. But let’s break this assumption down.

Historical data

The 8% number is apparently derived from U.S. historical data. Using historical averages is pretty popular both for savings and for studying safe withdrawal rates in retirement. One key resource about the historical data is Morningstar and Ibbotson Associates SBBI database. From it, we can learn that the S&P 500 on average since 1926 earned an 11.8% annual return, while intermediate-term government bonds earned 5.5% on average. However, these are not the numbers we should be using.

Comment by rms
2013-03-03 20:30:07

Didn’t the rule of 72 give a ten year doubling time somewhere between 7% and 8%?

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 21:08:28

72/7 = 10.3 years to double
72/8 = 9 years

 
 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 19:12:53

High risk gambling activities can pay very handsome returns right up until the day they blow up.

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 19:17:50

I can’t wait until the day when a black swan guano bomb sinks this high risk gambling operation. People really never do learn anything, do they?

County pension charts path through risky waters

By Mike Freeman and Jeff McDonald
6 a.m.March 2, 2013

In the high-stakes world of high finance, rewards are reaped by having the guts to take on risk.

A whiz who can win gains while narrowing risk would be worth $35 million to $45 million over the next five years, which is what the San Diego County pension system has agreed to pay consultant Lee Partridge of Houston.

After all, Partridge’s investments earned 6.5 percent in the last fiscal year for the pension fund, or about $550 million. Had he used the same investment strategy as Orange County’s pension system did, that number would have been $67 million.

Since many pension funds face a significant gap between the amount in their funds today and what they have promised pensioners in the future, corralling solid returns on investments while avoiding big losses is crucial.

The San Diego County Employees Retirement Association currently has about $79 for every $100 it expects to pay out to pensioners over the years. If SDCERA had earned Orange County’s pension system returns last year, it would have only $74 for every $100 promised.

SDCERA says Partridge earns the fund more than 99 percent of its peers, taking on less risk than 81 percent of them.

But what is risk, how is it measured, and are the available measurements adequate to keep $9 billion of public money safe?

Partridge manages the county employee retirement fund based on an investment strategy called risk parity. It contends that traditional asset allocation used by many pensions concentrates too much risk in stocks.

A standard diversified portfolio that invests 60 percent of its money in stocks and 40 percent in bonds would have more than 90 percent of the risk tethered to the stock holdings, says Partridge, chief investment officer with Salient Partners.

“Risk parity strategies try to balance out risk so they have an equal contribution across different asset classes,” he said in an interview with U-T San Diego.

SDCERA hasn’t adopted a pure risk parity strategy, says Partridge. The fund doesn’t strive to precisely achieve the same risk levels across stocks, bonds, real estate, private equity and other asset classes in the portfolio.

But the fund’s strategy does lean toward risk parity principles.

“The reason we have been considered risk parity is we target risk rather than dollar allocation,” says Partridge. “We tried to reduce the dominance of equities as the main risk factor that impacts the returns of the portfolio. That means we have lower equity allocation and a higher fixed-income allocation because we just need more dollars invested in fixed income to get a risk contribution that is noticeable.”

Comment by cactus
2013-03-03 21:16:01

I wonder if he invests in Junk bonds ? which are more like stocks than bonds anyway

Comment by ahansen
2013-03-03 22:38:13

Bonds guaranteed by…bonds. Same scam, different color; stealing from the pensioners to finance their pensions.

(Comments wont nest below this level)
 
 
 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 19:30:45

Sequester Real Talk: The 3 Dumbest Things About This Truly Dumb Law
By Derek Thompson
Mar 1 2013, 12:56 PM ET

Washington’s addiction to manufactured crises is the result of one party’s stubborn economic ignorance — time for the press to call it out.

The sequester is happening, people. At some point today, President Obama will send an order to cut $85 billion in spending in 2013, and then, slowly, those cuts will take place.

The extremely specific reason why the sequester is happening is that it’s the law and there is no deal on the table to replace it with another law. The bigger picture is that the sequester is the law because the president made a deal with Republicans to avoid hitting the debt ceiling and defaulting on our debt in 2011. That deal included a guillotine to spending if we didn’t cobble together a deficit-reduction plan before 2013. It’s 2013. We haven’t cobbled together a plan. So here comes the guillotine called Sequester.

There are many things to say about the sequester, but I want to focus on how it’s not merely a silly law, but an absurd law that rewards muddled thinking about both our debt and our politics. So here are the three silliest things about this very silly law.

 
Comment by rms
2013-03-03 20:33:47

More newspaper sites are denying access to their politicized propaganda. WTF?

 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 21:12:25

There really are too many fantastic real estate stories to keep up with them all — a sure sign the bubble is alive and well!

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 21:15:15

In case you thought monopoly price fixing was illegal, look no farther than Fannie Mae for evidence to the contrary.

SHORT SALES FALLING APART
Fannie Mae’s overpricing of homes is thwarting sales and pushing some owners toward foreclosure, real estate agents and sellers say
By Lily Leung
12:01 a.m. March 2, 2013
Updated 6:52 p.m. March 1, 2013

Is mortgage titan Fannie Mae overpricing homes throughout California?

Real estate agents and sellers have raised that question in a growing number of deals that have fallen apart with the taxpayer-supported company because of price disputes.

In those deals, sellers who had hoped for a more graceful exit from homeownership are pushed toward foreclosure.

Fannie Mae — which owns or backs about half of the home loans in California along with fellow mortgage-finance giant Freddie Mac — is trying to juggle two goals that appear to be at odds with each other.

The first is to help homeowners avert foreclosure through short sales.

For sellers, short sales — which allow borrowers to sell their homes for less than they’re worth as long as the owners of the mortgages say OK — are considered better than foreclosures because they shave off fewer points from credit scores and are sometimes more cost-effective for banks.

Sellers also benefit because they can rejoin the housing market faster, often cutting the wait time to as little as two years instead of seven for a foreclosure.

However, Fannie Mae also must price properties appropriately so taxpayers, who have floated the company for four years, are getting a good deal.

The result of those competing goals?

Fannie Mae would agree to start the short-sale process but would price those homes 20 percent to 40 percent above neighboring comparable sales, said Don Faught, president of the California Association of Realtors. The association is one of the largest trade groups in the state.

The disagreement in pricing has left homebuyers feeling ripped off, and at times, has caused short sales to fail. When short sales fail, home sellers could get stuck with foreclosure auction dates.

“Obviously this is a problem because the agent has to (re-)market the property with the Fannie Mae property price,” Faught said. “And often, there’s no time to re-market the property before a foreclosure (auction date.)”

The disputed values, which Fannie Mae says are justified, are based on several factors, said Fannie Mae spokesman Andrew Wilson. They include past sales, the opinions of contract real estate brokers, and sometimes appraisals.

Those factors yield a minimum amount for each property being considered for a short sale.

“We’re comfortable in the values we set,” Wilson said.

At times, the requested price is more than the highest comparable home sale and requested at the eleventh hour, say people involved in these deals.

Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 22:16:56

If I were a betting man, I’d bet the following:

1. The Fed is somehow entangled in Fannie Mae’s housing price stabilization scheme.

2. Part of the scheme is handing buyers in high priced markets low-downpayment, low-interest federally-guaranteed loans in amounts north of $700,000, to ensure there are prospective buyers at Fannie Mae’s artificially inflated (above-market-value) price levels.

3. The scheme is ultimately going to blow up, thanks to the piling in of hedge funds and foreign investors trying to make a quick buck on the Fed / Fannie Mae housing price reflation effort. When the quick flip investors cash out, this effort to artificially prop up prices is toast.

Those are just educated guesses…

 
 
 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 21:16:37

Construction spending falls in January
12:10p.m. EST March 1, 2013

* January was biggest one-month drop in 18 months on construction spending
* Dip is viewed as temporary setback in rebounding housing market
* Construction spending on government projects fell to lowest level in more than 6 years

WASHINGTON (AP) — Spending on U.S. construction projects fell in January by the largest amount in 18 months as home construction stalled and spending on government projects fell to the lowest level in more than six years.

The dip was viewed as a temporary setback with construction expected to keep moving higher this year.

Construction spending fell 2.1% in January compared with December, when spending had risen 1.1%. It was the biggest one-month decline since July 2011, the Commerce Department said Friday.

Residential construction, which has been leading the rebound in building, stalled in January with no gain in activity following a 1.7% rise in December.

Non-residential building dropped 5.1% while public construction was down 1%, pushing activity in the government sector to the lowest point since November 2006.

 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 22:09:07

Whose job is it to ensure that global share prices don’t give the appearance of deflation by crashing through the plunge protection floor?

Global Dow Realtime USD

2,076.80 Change -2.15 -0.10%
Volume
1,983.81b
Mar 4, 2013 12:07 a.m.
Previous close
2,078.95

 
Comment by Cantankerous Intellectual Bomb Thrower™
2013-03-03 22:22:56

Given all the financial innovations over the past several decades, I am skeptical there is no better way to structure the U.S. mortgage market than to continue allowing too-big-to-fail government-sponsored oligopolists to dominate the landscape.

They failed completely; now it’s time to try something different.

Planting One of the Many Seeds of the Housing Bubble
By Alex Planes
February 10, 2013

Fannie Mae, one of the two most important organizations to the American mortgage industry, got its start on Feb. 10, 1938. That day, acting on orders of President Franklin D. Roosevelt, the Reconstruction Finance Corporation founded the “National Mortgage Association of Washington,” later the Federal National Mortgage Association, seeding it with paid-in-capital stock worth $10 million and $1 million in surplus, and granting it the authority to borrow up to $211 million, or 20 times its capital.

The result of amendments to the National Housing Act of 1934, Fannie Mae was part of Roosevelt’s push to rehabilitate the devastated Depression-era American economy with stable housing policies. Its original focus, according to The Washington Post, was to “be a demonstration project of the part which such financial institutions can play in reviving a healthy recovery in housing construction, especially on a large-scale basis.” RFC Chairman Jesse H. Jones told the Post what he hoped:

“Builders, material and supply people, and workmen in the building trades will cooperate generally in a building program that will produce homes at the lowest possible cost to prospective homeowners and to those who may desire to build private or multiple dwellings for rent or sale … [A] real building program will increase employment and stimulate business more, perhaps, than any other one thing that can be done.”

Then, as now, Fannie Mae was to focus on acquiring government-insured mortgages from their underwriters to repackage as investable securities, thus freeing lenders to lend more than they otherwise would. In 1970, the government allowed Fannie Mae to purchase mortgages outside its traditional government-backed sphere and created Freddie Mac to provide competition in that market. In 1981, Fannie Mae devised the modern mortgage-backed security, which had existed in various forms since 1968, when the government had split Fannie Mae into its modern form and into Ginnie Mae, which is barred from investing in private mortgages.

Fannie Mae became a focal point of the 2008 financial crisis as a result of these securities. Since the 1990s, Fannie Mae had taken on greater levels of risk, accumulating (with its two government-sponsored enterprise siblings) some $2 trillion in debts. However, the more stringent requirements of the GSEs actually encouraged homebuyers to seek out subprime shysters for their loan needs, as private lenders had less oversight and could stuff their own MBS instruments with piles of junk, sending bad debts sloshing through the financial system before anyone knew what was happening.

The implosion of the housing bubble and its attendant subprime boom nevertheless destroyed housing prices for everyone, and this in turn caused widening losses for the GSEs. The federal government stepped in with a guaranteed backstop of hundreds of billions as it placed Fannie Mae and Freddie Mac into conservatorship during the darkest days of the financial crisis. Four years later, Fannie Mae still owed $117 billion to the government, requiring billions of dollars in repayments per quarter. In spite of its precarious financial situation, Fannie Mae nevertheless provided $3 trillion in liquidity to the mortgage market in those four years, allowing nearly 9 million refinancings and 2.5 million home purchases.

Who says capitalism can’t be art?

 
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