Bits Bucket for April 21, 2013
Post off-topic ideas, links, and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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Whistling as one strolls past the graveyard always offers great reassurance.
ft dot com
Global Insight: Debt threat to China’s financial system
By Jamil Anderlini in Beijing
China’s banking system is more likely to erode slowly than collapse
Thanks partly to a lack of transparency by the Chinese authorities and partly to ignorance from the rest of the world, economic headlines emanating from Beijing tend to cause panic and euphoria in equal measure and rapid succession.
So a slowdown in Chinese growth in the first quarter and the increasing realisation that China has entered a new period of slower economic expansion have shaken global markets in everything from commodities to currencies over the past two days.
In the wake of the first-quarter dip, fears of an imminent financial crash have proliferated. But a cursory examination of how China works should help put those fears to rest for now.
When we think of an archetypal financial crisis we usually think about it in terms of a catastrophic and rapid loss of faith in the soundness of a financial institution or system.
To simplify things, we can divide financial crises into three categories.
In the most recent example in 2008 the crash came with a run on previously rock-solid institutions such as Lehman Brothers by other institutions as they suddenly decided there was nothing really backing the piles of clever financial instruments they had all accumulated.
In 1997, we saw another category of crisis unfold when global investors lost faith in countries and pulled their money out of Asian tigers and dragons such as Thailand and South Korea.
The third category of crisis – a public run on one or more financial institutions – has been around for as long as people have been lending money to each other and was most recently seen in Britain with the run on Northern Rock in 2007.
None of these traditional systemic financial crises can happen in China.
…
What could a Chinese citizen do to ward off the erosion of the banking system, given that this implies the devaluation of the yuan? Or of the Japanese versus the yen? Or of the Americans versus the dollar?
We are told by the gold bears (Jim Rogers is now bearish) that we should have sold our metals in October. But the value of the toilet paper currency still falls.
Here are two versions of movable, hidable assets: toilet paper currency is one. Hard currency is the other.
I happen to think having both cash “under the mattress” and hard currency are smart ideas. But personally I prefer having ten times more hard currency than paper.
How many years is “legal tender” legal? I read from time to time about toilet paper currency being “retired.” could I take a dollar bill printed in 1950 and buy a candy bar with it (in 1966 a PayDay cost me a dime)?
Both toilet paper currency and hard currency are good for safety.
My point is one must accentuate the movable hideable asset that holds value over time. Does a good quality business man’s suit cost $1400 in Manhattan?
China’s day of reckoning is getting closer and closer:
http://www.businessinsider.com/jim-chanos-china-presentation-2013-4#the-country-is-putting-itself-at-risk-by-forcing-growth-2
they suddenly decided there was nothing really backing the piles of clever financial instruments
Decided?
Amidst all the bad news out of Boston last week, I completely missed the news of the China credit ratings downgrades.
China alert to debt risk fears
Updated: 2013-04-20 09:39
( Xinhua)
BEIJING - Three years after a massive stimulus package kept China’s economy moving during the global recession, policymakers and the market are now awakening to risks facing the world’s second-largest economy.
With mounting local debt triggering widespread concerns among domestic investors and foreign rating agencies, the government has listed dissolving financial risks as an important task this year.
In an executive meeting held this week, the State Council, or China’s cabinet, called for effective efforts to guard against risks in local government debt and credit markets while vowing to step up market oversight.
The China Banking Regulatory Commission (CBRC) also sounded an alarm for commercial lenders, warning that they should carefully watch loans extended to local government financing vehicles (LGFVs), which are financial entities set up by local governments to invest in infrastructure and other projects.
US rating firms Moody’s and Fitch both lowered their credit ratings for China last week over concerns about the risks that rapidly surging local government borrowing has posed to the broader economy.
“Progress has been less than anticipated in making local government contingent liabilities more transparent and reining in rapid credit growth,” Moody’s said.
Authorities have tried to slow local government borrowing through LGFVs after reports showed that about 35 percent of debt owed by LGFVs is set to mature between 2012 and 2014, raising concerns that local governments may be unable to handle liquidity pressure amid a slowing economy.
…
Germany’s Credit Rating Cut By Egan Jones
April 18, 2013
By Marie Cabural
Egan Jones, an independent rating agency, downgraded Germany’s sovereign debt rating from A+ to A. The rating agency said that the outlook of the country is negative.
In 2011, Egan Jones was the first agency to lower the credit rating of the United States from AAA to AA+ because of its high level of debt and difficulty in implementing significant spending cuts.
Pertaining to Germany’s downgrade, Egan Jones said, “Angela Merkel continues to resist calls for EU bonds (shared liabs), money printing, and is pushing for fiscal controls, and the seniority of bailout funding. Germany is likely to be outvoted by other ECB Members and therefore will have greater prospective exposure.” The rating agency also said that it will monitor the progress of the European Banking Union closely.
Egan Jones used IMF’s data, which is greater than the Eurostat data, in its decision to downgrade Germany’s sovereign debt rating.
…
Canary in the coal mine ?? If Germany (The biggest & Best in the euro) gets downgraded its a clear warning sign as far as I am concerned…Here is a black swan…Germany leaves the euro…
I don’t think it is a black swan since Soros has been calling for it for some time.
Soros has been calling for it for some time ??
Calling for it and it happening are two dramatically different events…We here in Silicon Valley have been calling the earthquake on the Hayward fault for as long as I can remember…Calling it and it actually happening will have two radically different effects…
But a black swan event is one everyone pretty much agrees can never happen.
Exactly.
everyone pretty much agrees can never happen ??
Exactly ??
Really ??….Thats not how Taleb theorizes it;
the “black swan theory” refers only to unexpected events of large magnitude and consequence and their dominant role in history. Such events, considered extreme outliers, collectively play vastly larger roles than regular occurrences.
Or has never even thought about. Neither an earthquake in CA nor Germany leaving the Euro would be properly classified as a black swan event.
would be properly classified as a black swan event ??
So neither of those are outliers ?? Because, if Germany does not leave the euro then that blows your hypothesis…
They have been talking about a rupture on the Hayward fault around here for my lifetime…60 years….So, if it occurs, I would consider that pretty darn random…
Besides, by your definition, name a black swan event…
“considered extreme outliers”
A earthquake in CA or even a total collapse of the Euro zone does not fit that definition. Certainly, Germany leaving which has been seriously discussed does not meet that definition.
Besides, by your definition, name a black swan event…
CBIT having an original thought. Seriously, a virus, killing the percentage of people killed by the black plague certainly would meet the definition of black swan. Yellowstone having a major eruption within the next few years would meet that definition. But a large volcano having an eruption somewhere in the world is not
So neither of those are outliers ?? Because, if Germany does not leave the euro then that blows your hypothesis
I do not even understand that statement. If I believe that there is a ten percent chance of Germany leaving the Euro it is not an extreme outlier. The fact that it does not happen does not blow my hypothesis. Now, I understand why you keep saying I said Romney would win. I said he had a possibility to win and to you that means he must win or my hypothesis was wrong.
I agree with scdave. Germany leaving the euro, or a major earthquake in Cali, would both be economic black swans. It’s not that no one has predicted them- that’s too high a bar, even if technically no one predicted actual black swans’ existence (but what did their discovery change?). Almost everything has been predicted by someone somewhere. Greece or Cyprus leaving the euro, not at all unexpected, would not be black swans. Germany or France leaving would be.
Likewise, a major earthquake in California, although certainly not unexpected, would be a black swan for the economy, because it would be an unexpected blow, from an unexpected quarter. (A sucker punch from somewhere in the back, as they say.) That, I think, is what most people mean when they say ‘black swan’.
What was the last unimagined/unimaginable thing that has occurred?
In New Zealand black swans are the norm….
alpha, to answer your question, I’d say Barack Obama being elected President of the United States was a black swan event as late as 2006.
If no country has an A+ rating, then an A rating is the new A+.
True and if you read why Germany was devalued it is because they are worried about the rest of the euro zone and its possible impact on Germany. If only we had a real leader like they have. She is much more of a man than Obama.
She is much more of a man than Obama ??
Just like Hilary I suppose…Glad to see you support that kind of woman….
Some guys are not afraid of strong women.
Some guys are not afraid of strong women ??
Good…They will get their chance to prove it in November of 2016….
Hillary is much more of a man than Obama but is she a good man or just one more globalist? I think the latter.
BTW, I would love to vote for a Thatcher.
I would love to vote for a Thatcher ??
Got it….Its only a strong woman if she is a republican…
Thatcher was not a Republican but she opposed globalization. Let us reverse the question Palin is a strong woman and in 2016 she is running against Biden, are you going to vote for her? I thought not. So you only vote for women that are democrats?
Equating Margaret Thatcher with Sarah Palin?
Sarah Palin has no interest in being President.
Joe Biden will be much too old in 2016.
2016 will be a clean slate.
is she a good man or just one more globalist?
Does Merkel oppose globalization? Or globalism, if that’s a different thing.
Hillary? You’re kidding. Can’t see what people see in her. A faux feminist who spent years aiding and abetting a serial sexual predator - often employing the
“nuts and sluts” defense against other women. When she ran for senate she would have been laughed off the face of the earth had she not been the boss’ wife. Being the boss’ wife is how the Yankee, Yale educated woman, became at partner in the “most prestigious” law firm in the good old boys’ town of Little Rock. Had she not been the boss’ wife nobody would have given her the time of day. What are her other attributes? Limousine liberal who while pushing socialized medicine would not even send her own kid to public school. (Same as Obama.) Strong no. Clever enough not to get caught in a series of dubious ethical lapses too long to list.
My only guess as to her popularity is that people vote emotionally. Think studies on both the left and right prove that. And that people like to vote for people with whom they identify. Guess there are a lot of old, fat, frumpy, women, who will be doormats just to stay in a relationship rather than go out and make on their own. But Hillary is darling of the left because she is such a good role model for women and girls.
In 2016, if it’s Hillary against Rand Paul, I might break my vow and vote for Rand. If he is for the continuation of world cop, I will stay home.
Disclaimer. Short of real bad physical abuse if I was riding the gravy train guest of a three or is it four time governor and two time president I might not voluntary leave it.
You two belong to the past.
Your fear of blacks and women in power is all very 1950’s.
Race card and sex card. You ignore the fact these two are extreme statist’s. Ask me about whether I would vote for Wendy McElroy, Walter Williams, or Thomas Sowell. Never mind. You would not want your fantasy statist bubble burst.
The race card is the typical excuse for a statist.
Bill would never have gotten to either the governor’s mansion or the White House without Hillary pulling the strings. And as much as it pains me to say it, the same goes for Mommy Reagan.
Comment by Skroodle
2013-04-21 11:29:49
You two belong to the past.
Your fear of blacks and women in power is all very 1950’s.
Skroodle if my loathing of Hillary is because she’s a woman how do you explain my liking and admiration for Margaret Thatcher? Kay Bailey Hutchison, Elizabeth Dole, Millicent Fenwick, Olympia Snow, etc..?
“The race card is the typical excuse for a statist.”
Does a statist support states’ rights?
No because states as we in the US know them are decentralized and supposed to be competing governments. The federal government is supposed to be a weak government. This is what the founders wanted so that different philosophies could compete.
Let’s say zero federal taxes. Only tariffs funding the government. Now if you are in California you are taxed ten percent total. If you are in Nevada you are taxed zero percent.
Also property taxes are relatively new, appearing in the last 100 years. Same with capital gain, dividend, and corporate taxes.
EXCELLENT, Happy! I’m stealing that one.
Why would central banks buy gold other than to diversify away from paper currencies like the yen and dollar?
I find the news that gold just had its worst month since October 2008 most intriguing.
How did U.S. stocks do in the ensuing months, from October 2008 through March 2009? And is it different this time?
how the gold market was crashed…
http://www.theburningplatform.com/?p=52558
“ALL OF A SUDDEN THE LONDON PHYSICAL PLATFORM THAT BUYS AND SELLS PHYSICAL GOLD GETS LOCKED UP. THE SYSTEM FREEZES.”
Just checked five year chart of GLD vs. S & P 500 index on yahoo finance. Gold dropped quite a bit in 2008 but outperformed stocks since then. Only recently it appears gold is significantly falling relative to stocks.
This is partly why I have been rpexpecting a 50% stock price drop on the broad indices will be followed by a steep gold price drop, then for gold to recover and regain the lead over stocks.
Fundamentally it will mean businesses will use the stock haircut as an excuse to cut hundreds of thousands of jobs. The federal reserve will keep pri ting toilet paper, and gold will be bought as the hedge against inflation. Eventually the chickens come home to roost.
“Gold dropped quite a bit in 2008 but outperformed stocks since then. Only recently it appears gold is significantly falling relative to stocks.”
My thought was that perhaps major gold price declines are a leading indicator of stock market declines. If it worked that way in 2008, will it work similarly this time?
Or is this time different?
Investing
4/17/2013 @ 10:13AM |34,562 views
Gold Will Get The Last Laugh On Central Banks
Stephen Leeb, Contributor
Intense recent selling of gold and other precious metals resulted from a confluence of factors. Gold plunged 10% Monday, ending the session at about $1,350—down nearly 30% (and more than $500) from its highs, to its lowest level in more than two years.
Europe launched the rout by pressuring Cyprus last week to sell the bulk of its gold reserves to help repay €9 billion in European Central Bank emergency aid. Alas, the markets see the Mediterranean island as a model for future bailouts. The ECB’s eagerness to force the sale of gold reserves to cover soaring bail-out costs eliminated its role as a currency—at least for now.
Fact is, gold has acted strangely since the January 2013 release of the proposed Basel 3 liquidity regulations. These outlined assets that banks could count as liquid should world markets experience a repeat of 2008. Gold was conspicuously missing from the Basel 3 liquidity list, despite its stellar 2008 performance. Included in its stead sat such nonstarters as equities and low-rated bonds. Clearly the Bank for International Settlements—aka the bank of all banks—wished to telegraph the message that neither governments nor bankers should consider gold a currency.
When Japan stepped up with quantitative easing roughly three times larger than that of the U.S., and gold held steady. When Nicosia bowed to the EU and literally confiscated money from individual bank accounts—at least for a few days—gold also stayed put.
Finally, however, the dispute between Nicosia and the Central Bank of Cyprus broke gold’s back, as it were. Nicosia won. Cyprus bowed to EU, ECB and IMF instructions to sell gold, albeit only $500 million, a relative pittance, generating an unmistakable tell tale. Thou shall not regard gold as a currency or value store. The markets careened in its face (SIC)
The Federal Reserve also wants to beat up on gold, via its drumbeat, suggesting that liquidity may be drying up and monetary easing might end soon. Never mind that recent economic data, on the whole, appears much weaker than expected, or that any halt to U.S. monetary easing could only follow higher inflation and commodity prices.
In short, the West desperately wants to maintain the dollar and euro as reserve currencies. To keep the status quo, however, Western economies must also ensure that gold remain in the background. Otherwise, the central banks could no longer control commodity prices or virtually anything else in the monetary realm.
I’m not a conspiracy buff, but everything suggests that the West, in ways not necessarily illegal, hopes to kneecap gold. It may work for a while, too but eventually gold will migrate into a reserve currency basket and its price will advance many times from its current level.
…
I’m not a conspiracy buff, but everything suggests that the West, in ways not necessarily illegal, hopes to kneecap gold. It may work for a while, too but eventually gold will migrate into a reserve currency basket and its price will advance many times from its current level.
…
Yes but if you suggest on this blog they are trying to kneecap gold you will be labeled a conspiracy buff by Whac[ed| and Alpha.
Dude — that was my post!
Are you saying I will now proceed to label myself a conspiracy buff?!
http://www.kitco.com/charts/historicalgold.html
This is the best link above that I could find for free that allows you to customize gold price charts, or for other metals. Grab a coffee or an apple and enjoy!
Notice the 2013 year to date breaks a pattern (no shiste Sherlock) and is a clear drop from January 1. The drops typically start in late spring and recover.
But physical buying is going the way guns are leaving the store shelves.
For me, my hard currency assets are way below my comfortable 10% level. Combined with having higher taxes and my automatic stock purchases, I am way overloaded on stocks. I might have to start selling stocks in September to finance more gold purchases.
On EBay you cannot find any silver American Eagle one ounce for under $33, yet its spot price is well under $30.
“Buying opportunity” or not, I stick with my plan. In two weeks gold might be up to $1500 but I will still wait. I was burned on stocks by being too emotional and buying or selling on the news of the day.
Being disciplined is the hardest part about investing. I use to write leaps and then buy them back instead of maximizing my return by letting them either expire worthless or at least just buying them back during their strike month. I was too quick to take profits.
For example with the current events, I had not written any gold options where the stock price was exceeding my strike price but I had a number of platinum and palladium shares which exceeded the strike price of the options. I really wanted to buy the options back to avoid the shares getting away from me. But then the price of metals collapsed and they are below the strike price. Discipline is a wonderful thing and making someone else absorb the loss is priceless.
“Being disciplined is the hardest part about investing.”
Owning your paid-off home and having zero debt is the true investor’s position. If an investment loss means you lose your home or wife or standard of living then the risk is disproportionate to the reward.
Successful investors(meaning wealthy)aren’t interested in owning depreciating assets like houses. Truly wealthy individuals lease their living quarters.
Your home is not a movable or hidable asset. Property tax rates can change drastically. Or your neighborhood might be rezoned by liberals for low income housing.
If an investment loss means you lose your home or wife or standard of living then the risk is disproportionate to the reward.
Can you sell a wife to meet a margin call? I may have to reconsider not being married.
Your neighborhood might also be “rezoned” by conservatives for overcrowded housing for illegal aliens willing to work for a fraction of the wages of citizens.
“Low income housing” is given in exchange for tax breaks.
Is Gold as Precious as it Once Was?
By Danielle Vitali | April 15, 2013 3:47 AM GMT
Gold Alert
Gold has been taking a beating in the New York Mercantile Exchange over the past few months as the price of gold continues to plummet. Gold hit a record low in nearly two years on Friday when gold fell under $1,500 an ounce igniting stop losses worldwide. It’s leading many investors wondering if Gold is as precious as it once was.
It has gotten many investment bankers and money managers losing faith in the once booming business. Recently, investment banking company Goldman Sachs recommended that investors sell their gold causing a stir in the Gold community.
Although it will take a while for Gold to fully recover, the next week is crucial for the millions of investors around the world as it’s determined if Gold will continue to plummet or if Friday’s numbers were merely a fluke.
…
PERSONAL FINANCE
April 21, 2013
No Price Drops at Jewelry Counter
Gold prices may be down more than 20% since 2011, but those looking to wear the precious metal rather than invest in it won’t find a similar decline at the jewelry counter.
Retail jewelry prices are less market-driven. “The price doesn’t necessarily move up and down as quickly as the gold price,” says Jessica Fung, a commodity analyst with BMO Capital Markets. That’s because prices at the counter factor in much more than the market rate for materials: the design and brand, as well as costs for manufacturing and profit for the seller. “The gold has been invested in already and the jewelry has been made,” says David Bonaparte, chief executive of Jewelers of America, a trade group.
…
You cannot print it: http://www.mining.com/web/four-important-facts-to-remember-about-gold/
Similarly, they aren’t making any more land.
Yes. but that is why land never goes to zero. It does not mean that land can never go down but as long as the population is going up over the long run it will go up in price. In a similar manner as long as we keep increasing the money supply faster than gold is mined, it will go up priced in the fiat currency. Simple concepts that seem to elude you.
Ever heard of the black plague? The human population will be going down some day in the future.
Somehow if something like the black plague hits, I don’t think that the thing I am worrying about most will be whether my house will fall in price. Moreover, if it does hit I think that stock prices will drop even more and a lot of companies will go bankrupt and the land will still have some value.
“land never goes to zero”
Well there are always exceptions to the rule. What do you think the land around the Fukushima nuclear plant is worth?
Is a digital dollar on the FED’s balance sheet worth exactly the same as the paper dollar in my pocket? I suspect that digital dollars have very limited uses, mainly the purchase of financial instruments and that’s why the government’s inflation numbers (that measure the costs of goods and services) have stayed so low.
Read my post above for most of my reply. However, the land around the plant still will not be zero particularly since I will have a cause of action against the nuke plant and will receive compensation since I live within the radius. I sure we can spend all day coming up with some weird exception to the rule but for practical purposes land always retains some value and in a world with a growing population will increase in value. Now while a liked the movie Twelve Monkeys and actually have it on my DVR, it really does not impact my investment decisions. If the PTB or an insane environmentalist want to kill off 95% of the population, there is little I can do except if a survive eat the spam I have put aside for just such a contingency.
Dan,
You’ll have to explain why land prices are falling across the northeast.
Land actually fell below zero just after the crash (price less than improvement costs).
And everytime a condo map is approved where they sell air space? Viola…land created.
First I do not have the facts before me that it is falling across all of the NE. However, in places such as upstate NY it is falling but so is the population. It does not negate my statement. If people start to move into upstate NY, guess what land will start to move up in price.
“It does not mean that land can never go down but as long as the population is going up over the long run it will go up in price.”
How long is your run? And does your growth trend (population / economic / etc) always go up over the time horizon you have in mind?
April 19, 2013
Is Economic Implosion Inevitable?
By Leonid Chuzhoy
The last three centuries have been a period of unprecedented economic growth. The world’s GDP doubled in the 18th century, increased six times in the 19th and then shot up 40 times in the 20th. Understandably, the public now considers growth to be the natural state of economy, while periods of recession are viewed as temporary aberrations.
Unfortunately, the recent recession is qualitatively different. Consider the basic economic equation:
The economic expansion in recent centuries was due to two factors: a) exponential population growth that followed advances in public sanitation and medical science; b) technological revolutions in industry and agriculture which have drastically increased individual productivity. Occasionally, one-time events, such as a burst of speculative bubble or rising commodity prices, could produce a sudden drop in the employment rate and plunge economy into recession. However, all past recessions were bound to be temporary thanks to the long-term demographic and technological trends.
These trends have now been reversed:
1) Fertility rate fell below replacement level in nearly all developed countries. As a result, the labor force stopped growing, while the dependent elderly population is still increasing. In addition, natural growth is lowest in the most productive social groups and highest among groups that receive public assistance.
…
“If people start to move into upstate NY, guess what land will start to move up in price.”
Upstate NY has nothing to do with it.
Actually Whac…they are….. Battery park city was created by all the dirt and rocks they took out of the ground to create the 1st world trade center…..
Thats the biggest Lie in real estate….landfills are all over…
I remember making gold nuggets when I was 12 years old.
It was a technique I learned form some hard core gold miners.
Mercury and the retorter did wonders for me.
Gold Meltdown Creates Bargains For Physical Buyers
By TRANG HO, INVESTOR’S BUSINESS DAILY
Posted 04/19/2013 02:51 PM ET
The gold market appears to have stabilized after the yellow metal crashed to a two-year low this week. Gold coin and bullion buyers went on a shopping spree, contending that the sell-off in the futures and ETF market offers a chance to buy at bargain prices.
Spot gold prices fell to as low as $1,320 on Monday but rallied to $1,400 by Friday, down 5% for the week.
SPDR Gold Shares (GLD), tracking a 10th of an ounce of bullion, rallied to 135.37 on the stock market today. It was down 6% for the week — the fourth losing week in a row. Down 12% so far this month, it’s on track to book its largest one-month decline since October 2008.
The World Gold Council, an industry group for the metal, released a statement Thursday saying this week’s sell-off has sparked an onslaught of physical buying. It saw shortages of gold bars and coins in Dubai and people paying premiums to spot prices in Mumbai and Shanghai.
“There is a current disconnect between the paper markets and the physical market,” Scott Carter, CEO of Lear Capital, a Los Angeles-based precious metals dealer, said in an email. “Japan has devalued the yen and many are buying physical gold to hedge against inflation. However, the paper market on Comex is much larger than the physical market. So even though the price can drop dramatically, more investors are buying gold.”
“Central banks bought 55 tons of physical gold on Monday the day gold dropped $150,” Carter added. “Why would central banks buy gold other than to diversify away from paper currencies like the yen and dollar?”
…
Sacramento Home Builders;
http://cl.exct.net/?ju=fe4a13797d6d027f761d&ls=fe1b1d777d6c017e741275&m=fefc1172766306&l=fed1157376640678&s=fe35157277640d7d711074&jb=ffcf14&t=
As we have discussed in the past, they make on the way up and make on the way down…Thats what real wealth does…
From the article;
Conrad normally doesn’t invest in residential land. But he bought 1,100 lots from Ryland Homes when the home-building giant exited Sacramento in the downturn. Conrad said he paid about $5 million for the lots in which Ryland had invested $70 million.
He said big publicly traded home builders dumped their lots to get rid of the debt that was weighing down their balance sheets, and also to take advantage of tax write-offs that minimized their losses.
Today, the lots he bought from Ryland are probably worth about $20 million, four times what he paid, Conrad said.
Better sell them soon before prices begin their next freefall. Land is still grotesquely overpriced, and there are way too many houses already built.
http://www.foxbusiness.com/personal-finance/2013/04/07/is-there-home-sale-tax-to-pay-for-obamacare/?intcmp=obnetwork
The tax will likely hit less than 1% of home sellers because of the capital gains exclusion…But this is what every home seller needs to watch out for….IF, through tax reform and simplification they eliminate the exclusion, you are talking “real” money for every home seller…The revenue generated would be massive…And, maybe thats part of the big picture plan in DC….
Do you need to eliminate the exclusion or just let rapid inflation reduce the value of it? The one thing that Reagan did that most angered the spend and tax crowd was index the brackets in income tax tables to adjust for inflation so this hidden way to increase taxes did not occur. I do not know for sure, but I expect Obama does not index the exclusion.
just let rapid inflation reduce the value of it ??
I doubt we will experience rapid inflation…Probably just a slow grind over a long period of time…On the other hand, tax reform (Simpson/Boles etc.) is high on the to-do list…Something is going to happen in the near term…Maybe 1-3 years…If that reform also includes elimination of the exemption, which I believe it may because it will be justified due to lower overall tax rates then there will be a boat-load of people that will get hit with the 3% tax…Just think of the revenue generated…3% on every profitable home sale transaction throughout the country…
Many of these guys in DC are corrupt to the core but they are not stupid…They will find ways to raise taxes in ways we cannot avoid…
raise taxes = raise revenue….
“I do not know for sure, but I expect Obama does not index the exclusion.”
The §121 exclusion was passed in 94 / 95 ish and has never been indexed. And the president doesn’t pass legislation, Congress does.
Like SCDave said, this tax will affect very few people.
O say Reagan should not get any blame for the 1986 immigration bill?
BTW, It was a democratic congress in 1986 so I expect to hear that it was the democrats that granted amnesty in 1986 not Ronald Reagan.
If you are talking about the Simpson-Mazzoli Act of 1986, Simpson was a Republican and Mazzoli a Democrat.
My point is this blog considers the amnesty to be all Reagan’s fault but with Obama care the tax increase should be laid on Congress, despite it also being a Democratic Congress, just looking for a little consistency even if it goes against a MSNBC rant.
Except the Ronnie was a very vocal advocate for amnesty from the time he was running for governor of CA — when he realized that a deal with Cesar Chavez’s farm workers union could help him overcome the Brown juggarnaut.
Q. Has anything changed since the HBB started circa 2005?
A. Yes. The term Housing Bubble has gained widespread acceptance.
real estate is the path to riches like you have never imagined.
A. Yes. Corrupt liars/NAR/MBA PR presence in media has grown.
An interesting glimpse into the public’s psychology has also become evident. Many more than I would have believed are willing to adopt whatever position they need politically/psychologically/emotionally to make sure that the price of their house doesn’t fall (or isn’t acknowledged as having fallen).
It’s a hot button issue almost akin to race or abortion.
I agree and I came to that conclusion shortly after Obama was reelected. One thing that his policies did, which include the printing of money, was to arrest in nominal terms the fall in housing prices. The large deficits or the inflationary impact of the policies did not matter as much as the housing prices.
Funny was thinking the other day that this blog has been active for ~ 7 years? Amazing. Pretty sure I began found it right before selling my house in May 2005.
I don’t recall if it started in 2004 or 2005 (I found it in 2005), but I am pretty sure it has been around for at least eight years (2013 - 2005 = 8).
“If you buy a house today at these massively inflated prices, you will be underwater instantly and you will never recover financially. Beware.”
Economic View
Before Housing Bubbles, There Was Land Fever
Minh Uong/The New York Times
By ROBERT J. SHILLER
Published: April 20, 2013
SINCE 1997, we have lived through the biggest real estate bubble in United States history — followed by the most calamitous decline in housing prices that the country has ever seen.
Fundamental factors like inflation and construction costs affect home prices, of course. But the radical shifts in housing prices in recent years were caused mainly by investor-induced speculation.
Anyone contemplating the purchase of a home wants an idea of where prices will be when it is eventually time to sell, perhaps many years later. For that kind of long-term forecasting, we need to understand the reasons for the recent, violent price cycle, and whether it is likely to repeat itself.
History has much to teach us about real estate bubbles, and some of it is reassuring. The land booms of New York State in the 1790s, Kansas in the 1850s, California in the 1880s and Florida in the 1920s all appear to have been relatively isolated events. And the cycle was not repeated in short order.
But those events were fundamentally different from the recent housing bubble. As relatively local phenomena, involving a fairly small number of adventurers, they did not consume most people’s attention. And a major cause can be easily identified: they developed from the promotion of supposedly valuable lots of land.
In fact, outside of New York City and a few urban centers, most speculators in past decades didn’t focus much on home prices. The term “housing bubble” was not even in their vocabulary. Land, not houses, was the object of their desires. They had “land mania” or “land fever.”
…
The housing bubble was really a land bubble. It wasn’t the price of materials or building, but raw land which skyrocketed.
Which is strange since lots and land can be had for a few hundred dollars an acre in all 48 states.
So where’s the money? “it’s in the land!” doesn’t work. “Materials prices are up!” is false….. we’re down to labor…. and you know what the score is with that.
The reality?
Tens of millions of suckers overpaid for what is always a depreciating asset.
So where’s the money? “it’s in the land!” doesn’t work.
How about “it’s in the location!”
Land prices are driven by home prices…not the other way around.
Wrong.
Both land and home prices are driven skyward by cheap credit.
Land is worthless unless you can do something with it…the two most popular being farming, or housing. Without value from farming or housing, there is no land value.
“Land is worthless unless you can do something with it…”
Such as selling it to a greater fool armed with a bucket of money and a box of stupid, thanks in part to cheap credit…
Buyers of Volusia County swampland hope to get money back
Real-estate pitchman pleaded no contest to organized fraud
December 16, 2011|By Ludmilla Lelis, Orlando Sentinel
The real-estate pitch by James Kelly and his company promised a good investment for land in Volusia County near DeLand. Instead, prosecutors said, it was the decades-old scam of selling unbuildable Florida swamp.
On Friday, some of the unsuspecting buyers, all of them South Florida residents originally from Haiti, appeared before a circuit judge in DeLand in the hope of getting their money back. But there were no clear answers about when they would be repaid.
…
Have you tried to borrow money with land as collateral recently? It isn’t cheap, and it isn’t plentiful.
Maybe up to 50% of cost, maybe you can get away with 8% interest rate (but likely more, including points in, points out), and good luck borrowing without signing a personal guarantee to repay the loan.
Cheap credit isn’t driving land values. The allure of building and selling ever-more expensive homes (which is driven by sentiment and cheap credit) on that land is driving land values.
BTW Whac, you just proved my point with the article you sent.
unbuildable=can’t put houses on it=worthless
If you can build houses on it, it becomes valuable.
If you are close enough to high paying jobs, and can build expensive houses on it, it becomes very valuable.
“…it was the decades-old scam of selling unbuildable Florida swamp.”
Florida, a sunny place for shady people.
ike Whitney nails it yet again. The money quote:
“Everything about the US housing market is fake”
http://www.counterpunch.org/2013/02/11/housing-hijinx/
From the article;
“There remain over 10 million vacant housing units” and that does not include the “shadow supply”.
Again….. if you bought a house 1998-2013, you’re going to lose a lot of money. ALOT of money.
Ike “Mike” Whitney?
More Mike Whitney:
http://www.counterpunch.org/2013/04/16/housings-breakout-year/
http://www.counterpunch.org/2013/02/19/theres-still-a-foreclosure-crisis/
http://www.counterpunch.org/2012/12/31/all-you-wanted-to-know-about-housing-in-three-minutes/
http://www.counterpunch.org/2012/12/18/the-mysterious-new-housing-bubble/
Glad to see you weren’t at Loveland yesterday.
The initial reports are that the avalanche happened in the backcountry near Loveland Pass, which is not to be confused with Loveland Valley/Basin Ski Area. Five dead in a single incident is the deadliest in CO since 1962.
Economic View
Why Home Prices Change (or Don’t)
By ROBERT J. SHILLER
Published: April 13, 2013
WHAT prices will today’s home buyers get if they sell a decade from now?
Most people live in their home for many years. They don’t need to view it as an investment at all, but if they do, they surely need a long forecasting horizon.
The problem is that modern economics has a poor understanding of past movements in home prices. And that makes the task of predicting the state of the market in 2023 challenging, at the very least. Still, we can learn something by analyzing the factors that affect home prices in general.
There has been some good news lately: home prices have risen over the last year, and with those gains there has been a renewed sense of optimism. But do these price increases mean that homes are now good investments for the long haul?
Unfortunately, no. We do know one thing from economic research: one-year home price increases, after correcting for inflation, have had almost no statistical relationship to increases 10 years down the road. Thus, the upturn last year is irrelevant to long-run forecasting. Booms are typically followed by busts, usually in far less than 10 years. In a decade, an entire housing boom, if there is one in inflation-corrected terms, is likely to have been reversed and completely washed away.
…
Correct: What we’re experiencing is a dead cat bounce just as the article states and the data shows.
“The problem is that modern economics has a poor understanding of past movements in home prices.”
The real problem is that we have a centrally controlled economy that manipulates available inventory and non-preforming debt levels with created money.
Inflation corrected.
There is no “inflation”.
Then why does Professor Shiller bother correcting for it?
If the current MSM-reported rate of appreciation* continues for the next nine months, California home prices will double by January 2014.
There is no bubble here, folks! Honest!!
* Prices reportedly increased 8% last month. The multiplier for home prices after nine months of appreciation at an 8% monthly rate is
(1.08)^9 = 1.999.
California home prices soar 8 percent in 1 month
By The Associated Press
5:11 p.m. April 18, 2013
LOS ANGELES — California’s median home sales price soared more than 8 percent from February to March - the latest evidence of the fast-paced recovery in the state’s housing market as buyers compete for thin supplies, a research firm said Thursday.
The median price for new and existing houses and condominiums surged by $24,000 in March to $313,000, up 24.7 percent from the same period last year, DataQuick said. It was the 13th straight annual gain in statewide home prices.
There were 37,764 homes sold in the state, up 0.8 percent from last year.
Lack of inventory has hampered sales. The California Association of Realtors reported Monday that its index of unsold inventory for single-family homes was 2.9 months in March, compared to 4.2 months a year earlier.
The figure represents how long it would take to sell all homes at the current sales clip. Supply in a normal market is considered to be five to seven months.
Homes were on the market for a median of 29.4 days in March, down sharply from 52.2 days a year earlier, according to the Realtors group.
DataQuick said the median sales price in the San Francisco Bay area reached $436,000 in March, up 21.8 percent from a year earlier. The median jumped by $31,000, or 7.7 percent, during March alone.
“There’s been a shift in psychology, where more people worry prices will rise and fewer fear a decline,” said John Walsh, DataQuick president.
…
Interesting.
The official transaction data shows prices falling in CA MoM and QoQ.
http://picpaste.com/pics/99598d907cd6300ec2d61601a5979ed3.1366555437.png
Our friendly California realtards are lying to the public again? You don’t say!
prices are rising in the lower end of the market.
Housing prices are falling. And for good reason.
This is the February to March data…not yet showing up on your graph. And since February is the annual low, why are you surprised?
What the numbers fail to explain is that there is a dearth of inventory on the low end, so median prices are rising due to the lack of sales in the lower price points.
Absolutely spot on!
And as usual, the lazy, lame, REIC-funded MSM completely misses the story.
The lack of inventory at the low end doesn’t help (COULD be a byproduct of less distress generally moving through the market…total distressed sales in February 2013 were at 33%, down from 53% the year earlier…don’t know if it went down from Feb to March).
However, seasonality is the big culprit. February is usually the annual low in median, so an increase in March is expected.
In fact, here’s some news you can use from analyzing the data from Zillow.
From 1997 to 2012 (16 full years of data that they share), the increase in median from February to March was:
The highest monthly increase 4 of 16 years;
2nd highest monthly increase 7 of 16 years;
3rd highest monthly increase 3 of 16 years;
That would be 14 of 16 years where the February to March change in median was either the highest, second highest, or third highest such monthly change for the year.
The worst showing for March was 6th highest.
And where do we go from here? All indications would point to a strong showing for April too.
April had:
The highest MoM median change in 8 of 16 years;
The 2nd highest in 2 of 16;
The 3rd highest in 2 of 16;
The 4th highest in 4 of 16;
May becomes less predictable, but usually still pretty strong…with 10 of 16 years in the top 4 monthly median changes.
If you measure a rolling 3 month change, you find that March-May is the strongest three month period in terms of changing median prices in 10 of 16 years, and second highest in 5 of 16 years.
In fact, the seasonality in median is so strong for these three months that is masked the collapse in home prices in 2008, where the median only fell by 0.1% during these three months that year.
Every other year (including 2009 and 2010), the median increased the three months ending May.
Yes, the change in median from March to May will look strong.
It does NOT mean that these three months are an indicator of what happens to the median for the whole year.
“There’s been a shift in psychology, where more people worry prices will rise and fewer fear a decline,” said John Walsh, DataQuick president.
i.e. The wool is getting long again.
I’ll repost something I said elsewhere:
This is the MEDIAN, and typically, the median rises off the February low each year, and goes up through the summer before the increases either slow, or the median actually falls going to the next February.
Look to year on year data for the truth of what is happening, not one of the 12 months where the median is expected to rise, and extrapolate that one month over the entire year.
8% monthly increase in price simply isn’t sustainable…even during the inflation of a bubble.
everyone wants to get some free equity instead of punchn a time clock.
Do you blame them?
I do. They are stupid and lazy.
While the banksters are all smart and hard working.
Some years ago I remarked here that I believed that so many people jumped onto the house flipping and HELOC bandwagons because they became acutely aware that not only were they not getting ahead at the day job, they were quickly losing ground.
Banking used to be a low paying profession. Like government employment it was considered safe ( guess not during the depression) hence lower income. Guess it’s still the same for most bank employees. It’s really upper management who does well so no different from any industry in regards to compensation. If you want to discuss government support that’s another thing….
“everyone wants to get some free equity instead of punchn a time clock.”
+1 Free and All you can eat.
How many true believers in gold who read or post here knew that George Soros cashed out of his gold investments last year after speculating in it, despite labeling gold as the Ultimate Bubble?
ft dot com
April 19, 2013 7:41 pm
Gold: Losing its charm?
By Jack Farchy
After a decade-long bull run, prices have had their sharpest fall since the 1980s. But many are keeping the faith
When David Gornall started trading precious metals as a 21-year-old in 1981, weekends were a thing to be feared. Only a few brave souls, he remembers, were prepared to trade on Friday afternoon: prices were liable to have collapsed by Monday.
This week brought back memories. On Monday gold suffered an 8.5 per cent rout – the steepest fall since 1983, when the last bull market was in its death throes and daily price swings of 10 per cent or more were common.
“It feels like we’ve gone back to those old days,” says Mr Gornall, who as chairman of the London Bullion Market Association is now one of the world’s most senior gold traders.
The collapse in the gold price has sent a ripple of alarm through the investment world. After 10 years of rising prices, gold investing is no longer the preserve of a few specialists and coin collectors, but a mainstream interest of investors from pension funds and university endowments to savers and retirees from Salt Lake City to Shanghai.
But optimism about ever-rising prices evaporated this week as gold fell $243 from Friday morning to Monday night – the largest move on record in dollar terms, and the third-largest in percentage terms.
Bankers say that their phones have been ringing off the hook with panicked calls from rich clients who have been persuaded to hold 2-10 per cent of their wealth in gold.
“You had a year’s move in 48 hours,” says Paul Crone, founder and chief investment officer of Citrine Capital Management, a metals-focused hedge fund. “A lot of people are in shock.”
Gold investors may be in shock but they cannot claim they were not warned. They have enjoyed a stellar decade-long run, with prices rallying more than 600 per cent to a peak of $1,920 a troy ounce in September, 2011, as fear swept the financial system and drove ever more investors to seek harbour in the metal.
But for every new price high there has been a naysayer decrying gold as an irrational investment. George Soros described it as “the ultimate asset bubble” – although he carried on investing in it until late last year, when he sold almost all his holdings. Warren Buffett mocked gold investors for digging it out of the ground only to “bury it again and pay people to stand around guarding it”.
…
So Warren Buffet thinks he is better than hundreds of generations of humanity who preferred precious metals as a medium of exchange over conch shells, tulips, rocks, and toilet paper?
To Warren Buffet’s credit, stocks in the long run have done well over a lot of crises. But what if the crisis is the second American revolution? Then I would wish I was 100 percent in precious metals and living on ten acres in New Hampshire.
Why New Hampshire? It has a pretty short growing season.
The Free State Project is there.
So you think New Hampshire will be successful in seceding from the Union? Or do you expect the 2nd American revolution to be non-violent? Just what does this crisis look like?
I’m Hoping the second American revolution will be non-violent. But if the government wants to initiate force, “The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants.”
The liberty tree:
http://en.wikipedia.org/wiki/Liberty_Tree
Two other goldbugs, Jim Grant and Kyle Bass are somewhat surprised why gold is so low.
I’m willing to bet that Buffett has done better by holding securities in strong companies long term than anyone has done by holding gold long-term.
Gold is a volatile store of wealth, not a creator of it.
I believe his comments were based on recent absurd valuations of gold relative to productive assets. I can’t recall him ever suggesting that gold would go away as a medium of exchange, or was equally valuable to toilet paper.
The dollar lost 97% of its value since 1913. For gold to do the same, it would have to be priced at $42. They’d have to lasso an asteroid that has a hundred thousand tons of gold to bring the price low. Possible, but not in the next 40 years. There is an additional premium on gold that we buyers rarely discuss. I will just say that one can buy hundreds of ounces over a few decades with cash and no paper trail. And can sell in exchange for cash and no paper trail. Part and parcel of being a movable and hidable asset.
I have found a hiding place for my gold and ammo that make me sleep more soundly. It’s not in California.
“For gold to do the same, it would have to be priced at $42.”
That’s clearly not gonna happen, so why even go there?
I did so I knew Obama was going to help manipulate a correction. It pays to have inside information.
Housing isn’t the only re-inflated bubble these days
Bitcoin bubble re-inflates
By Aaron Smith @CNNMoneyInvest
April 19, 2013: 12:08 PM ET
Bitcoin prices continue their roller coaster ride.
NEW YORK (CNNMoney)
Bitcoin prices are back in rally mode, just one week after it looked like the bubble had started to burst.
Early Friday, Bitcoin prices traded as high as $136.43 before pulling back to $119.36. That’s more than double this week’s low of $50.
Trading volume doubled in just two hours.
The price of the virtual currency, which was created by an anonymous hacker just four years ago, has increased almost 20-fold this year. It gained particular attention in the wake of a mini-bank run in Cyprus, which had raised concerns about the health of government-backed paper currencies like the euro and the U.S. dollar.
As traders and investors jumped on the bandwagon, prices spiked to $266.
The rush of activity led Mt. Gox, a Japan-based exchange that claims to handle 80% of Bitcoin trade worldwide, to halt trading.
Prices came down sharply when trading resumed, leading to speculation about whether the Bitcoin bubble had finally burst.
Societe Generale currency analyst Sebastien Galy said the limited supply of Bitcoins is largely responsible for its wild price swings, which he says are subject to the whims of demand.
“It’s a bubble which unfortunately pops and pops and pops until one day it either loses credibility or the supply reaches the total maximum they predicted, which is 21 million,” he said.
It’s a bubble which unfortunately pops and pops and pops until one day it either loses credibility or the supply reaches the total maximum they predicted, which is 21 million,” he said.
Like fart bubbles in the bathtub?
Housing Demand in Sacramento Collapsing To New Low
http://picpaste.com/pics/1f25fb38fb53cdf6936597d14cdb4bf6.1366553959.png
This is what happens when prices are grossly inflated… and falling.
If you’re paying more than $55 per square foot for a resale house, you’re paying far too much.
ALWAYS perform a per square foot estimate of the value of a house and NEVER entrust anyone else to do it for you. The Real Estate Machine will do and say anything to keep you from performing this analysis.
Actually, I’ve heard that $57.50 is ok too.
Just sayin’…
OT,
Has anyone found any information regarding the fire arms the 2 Chechan bros are allenged to have used in their gun battles with law enforcement?
I can find nothing?
Just wondering.
Nope. I am curios about that, too.
One report said the brothers took the gun away from MIT cop.
Another report said that they were throwing homemade grenades. FWIW
Comment by usury camp resident
2013-04-21 07:48:15
One report said the brothers took the gun away from MIT cop.
—————————————————————————–
are you saying they disarmed and armed police officer without they use of a gun of their own?
and then shot the officer with his own gun?
Don’t know but the report I read implied that. Hopefully we will get a better explanation soon…..
Well, 10,000 cops couldn’t follow a bloody trail to find a complete amateur.
I don’t know but am speculating handguns. I think they shot the police within close enough distance to be accurate. A rifle is more accurate.
Which brings to mine that Boston is no “gun friendly” city. Doubtful the CCP is easy enough to get. So the leftist gun laws certainly were not impressive to the two brothers to decide “oh shucks, we cannot get guns and may as well use our fists!” when guns are outlaws, only outlaws have guns.
Twaddle! The Magic Power of Government can simply waft all those dangerous weapons away on a vagrant spring breeze.
Then they can move on to safetifying The Children from pressure cookers, ball bearings, and people with funny names.
It’s a bright, safe future ahead, citizens!
Does this mean its GO TIME?
I say that it’s “Go Diamondbacks!”
Does this mean its GO TIME?
http://westernrifleshooters.files.wordpress.com/2013/04/policeconvergemass4.jpg
If I post that on Facebook, my Republican sister and her Republican offspring, who are bible thumping, cop-can-do-no-wrong conservatives will have a fit.
That same type of Republican in Arizona kept voting in McSame.
“Get used to it, America.”
At least now everybody realizes that Martial Law and house to house searches by heavily armed police is for the common good.
It’s got traditional republicans a warm fuzzy feeling to see heavily armed men seven at a time knocking on a house and demanding entry. Which constitutional amendment does this violate? Illegal search. Their warrant is their rifle. I am not so impressed. A private homeowner violated lockdown to see what’s up with his boat. He discovered the younger thug. Not the cops. Lockdown did no good but give swastica-laden liberals boners.
“It’s got traditional republicans a warm fuzzy feeling to see heavily armed men seven at a time knocking on a house and demanding entry.”
Did any of them have shovels?
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A private homeowner violated lockdown to see what’s up with his boat. He discovered the younger thug. Not the cops.
Nope. More misinformation. When the lockdown was proclaimed to be ended, a private homeowner then went out into his yard to check things out. He noticed a loose tarp / weather cover on the boat, which was parked in his back yard. He walked up to it & saw blood spots near the opening. He at first thought a wild animal had clawed its way into his boat. He looked inside & saw a bloody body. I don’t recall if the body showed signs of life or not. He immediately notified police, who were still in the area. Police were able to immediately surround & secure the area.
This site was just outside of the boundary of the house-to-house search conducted most of the day on Friday.
I expect there will continue to be a similar flood of misinformation / BS like this which will be endlessly propagated to suit whatever political end the propagator is seeking. This will go on for many years. Just like what happened after 9/11, come to think of it.
The following is from the Boston Globe, which dropped their paywall for a few days to cover this event. The paywall will resume in a few hours.
This quote is from an AP piece dated 4/15, the day of the bombing:
“Across the U.S., from Washington to Los Angeles, police stepped up security, monitoring landmarks, government buildings, transit hubs and sporting events. Security was especially tight in Boston, with bomb-sniffing dogs checking Amtrak passengers’ luggage at South Station and transit police patrolling with rifles.
“They can give me a cavity search right now and I’d be perfectly happy,” said Daniel Wood, a video producer from New York City who was waiting for a train.”
Perfectly happy? This is exactly the kind of conditioning the statists want. Why would the AP include a quote this explicit in an article just hours after the bombing? Does Daniel Wood even exist?
This is sickening, and Americans are so stupid and emotionally volatile they don’t just deserve what they get now, they deserve even worse. Chanting “USA USA” after the younger brother was captured is just revolting.
http://abcnews.go.com/Sports/wireStory/explosions-boston-marathon-finish-line-18960342
“Lockdown did no good but give swastica-laden liberals boners.”
You live in a bizarre world. I have never seen a liberal with a swastika. I thought that was reserved for far right white supremacists.
End italics
” A private homeowner violated lockdown to see what’s up with his boat.”
The story I read said he went outside after the lockdown was lifted.
According to the news, there was a “firefight” after the cops surrounded the boat. This doesn’t seem to square with the above report of a motionless bleeding body. Was the “spectacular firefight” a bunch of trigger happy, testosterone laden cops shooting up a boat with an unconscious kid in it?
Stay away from the drills and training exercises.
“At the starting line this morning, they had bomb sniffing dogs and the bomb squad out there,” he said. “They kept announcing to runners not to be alarmed, that they were running a training exercise,” Stevenson told AL.com.
“They kept making announcements saying to the participants ‘do not worry, this is just a training exercise’” said Stevenson, who is the University of Mobile’s Cross Country Coach. …
Local news video with Stevenson.
informationliberation - Archive [ 4/16/2013 ]
http://www.informationliberation.com/archives.php?d=16&m=4&y=2013 - - Cached - Similar pages
5 days ago …
Liberalism = Fascism. Explained here.
http://www.peikoff.com/lr/home.htm
“Liberalism = Fascism. Explained here.”
It was the only link I could find with the local news spot that had the University of Mobile’s Cross Country Coach, go figure.
One of the fundamental tenets of Nazism was the idea of the purity of the master race. How do you square that with the diversity is good meme present in liberal thought?
One of the other fundamental characteristics of Nazism was militarism. That strikes me as more neo-con than liberal.
The introduction is a bit of a kitchen sink.
“A pervasive atmosphere of decadence, moral bankruptcy, and nihilist art accompanied by the rise of escapist mystic cults of every kind — astrology, “alternative medicine,” Orientalists, extrasensory perception, etc.”
Escapist mystic cults have been around for a long time. Spiritualism was prominent in the 1870s, long before the rise of Nazism.
Nihilist art - is he referring to Dada? Or Andy Warhol?
He is an Ayn Rand disciple, so it doesn’t surprise me that he would have jumbled ideas. I suspect he would have preferred no government. A power vacuum is a short-lived state. The most ruthless will fill it.
Did I mention “Nazism?”
I mentioned “Fascism” instead. Fascism does not require a master race or racism. It is an economic system. Do a little research in “The Ominous Parallels.” Bismarck was the first to institute social security. All these progressive and Democrat ideals are part of Mein Kampf.
“Did I mention “Nazism?””
“Lockdown did no good but give swastica-laden liberals boners.”
You were the one who linked liberals and swastikas.
Washington, DC Rental Rates Falling YoY, QoQ and MoM
http://picpaste.com/pics/49d0e4a69ba16592aa9a78878a3d0291.1366555662.png
Why pay massively inflated prices for DC housing when you can rent for half the cost of buying?
“Md. Realtor Charged With Burglary of Virginia Home”
http://washington.cbslocal.com/2013/03/04/md-realtor-charged-with-burglary-of-virginia-home/
Realtor…. forever finding new ways to rob you blind.
A quick look at listing prices in any market would lead one to believe it is 2006.
As would a quick look at the recent MSM-reported 8% monthly rate of appreciation for California home prices that pencils out to an annualized rate of (1.08^12-1)*100% = 152%.
That 8% was a median price…has to include a change in mix.
As RAL has so frequently shared through his constant mis-analyzing the data, February of each year is the seasonal low in median price. In March, the median price generally goes up (and has every year from 1997, except 3/2008 and 3/2009).
The median rises usually until the end of summer or so, and then flattens or even goes down.
Seasonality at play here–extrapolating to 152% increase based on this one month is silliness.
Another vestige of 2006:
Troll attacks reminiscent of scenes from the Alfred Hitchcock movie, The Birds…
Sunday 21 April 2013
Financial crisis caused by too many bankers taking cocaine, says former drugs tsar
By Nick Britten
3:10PM BST 14 Apr 2013
Prof Nutt said that too many bankers who took the drug were “overconfident” and so “took more risks” and said that not only did it lead to the current crisis in this country, but also the 1995 collapse of Barings bank.
He said cocaine was perfect for their “culture of excitement and drive and more and more and more”, adding: “Bankers use cocaine and got us into this terrible mess. It is a ‘more’ drug.”
…
The article I read said Ritalin and Adderal were more common than cocaine. As legally prescribed drugs, they could be kept in plain sight.
If true, that would undermine a former drug czar’s justification for the war on drugs.
Danes Rethink a Welfare State Ample to a Fault -NYT, 21 April
Seem free government cheese is a disincentive to work. Who would have thought?
http://www.nytimes.com/2013/04/21/world/europe/danes-rethink-a-welfare-state-ample-to-a-fault.html?ref=world
Data points in millions:
(1.) “Need two million new housing units a year”
(2.) “Current production just past one million annually”
(3.) Total housing units 132 (2011) for a 309 (2010) population
(4.) Current vacant properties 17 million
(5.) Owner occupied (2011) 74 and rented 41
(6.) “housing prices will hit 1990 to 1999 levels”
(7.) Of 115 occupied units 94 million purchased since 1990
(8.) 21 purchased prior to 1990 of which 14 million mtge free
(9.) Wear out rate of vacant/under rented units estimate 1 a year
Data suggests more people (82%) underwater than we think; Housing replacement may not even be happening (wear/new equal);
Type of use migration heavier than suspected;
About 60% mortgage free homeowners have increased equity (14) - only 10% of homeowners;
Assuming USA same as Canada - 70% of seniors w/ home equity loans;
Can anyone see any housing strength in this data ?
Rah rah economics or msm bull cannot in itself create demand when you need funding abilities that come only from stable wealth creation ie adequate employment.
Increasing the price of 30 Dow stocks while watching the banks slow the M1 which required Bernake to push the M2 - while the banks try to lower their leverage to 18 (vs 30) - will it work ?
Partial source:
http://factfinder2.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ACS_11_1YR_DP04&prodType=table
Has Seaworld Entertainment been financially gutted and set on course for a future debt default?
AL’S EMPORIUM
April 21, 2013
Squid Sells SeaWorld
By AL LEWIS
SeaWorld Entertainment launched its initial public stock offering on Friday, and among the lead underwriters was Goldman Sachs, GS the great vampire squid.
With SeaWorld firmly in its tentacles, Goldman is sucking up millions in investment-banking fees. It’s also redeeming some of the $300 million in senior subordinated debt instruments it holds on the big corporate fish tank.
Orlando-based SeaWorld runs 11 theme parks, including Busch Gardens in Tampa and SeaWorlds in Orlando, San Diego, and San Antonio. None of the more than $700 million raised in its IPO will go to Shamu the whale, Puck the penguin or anything else that swims in the parks. The money is going to retire debt and pay some enormous fees.
Buyout firm Blackstone Group BX +0.30% flooded SeaWorld with debt when it purchased it from Anheuser-Busch for $2.3 billion in December 2009. Blackstone put down $1 billion in cash and financed the rest.
Friday’s opening IPO price of $27 a share valued SeaWorld at about $2.5 billion. The company has more than $1.8 billion in long-term debt. Or as it warned in its IPO registration statement, “We are highly leveraged.” Nevertheless, the IPO did very well, rising more than 25% to nearly $34 a share on its first day of trading.
…
it will end up like facebook. nice that they used the money to payoff debts.
Anyone want to bet how much of that debt was issued at confiscatory rates/fees to the vampire squid?
It’s exactly like Mitt would have done.
Perhaps…but apparently there were enough people to believe in the business to invest a lot of equity behind all that debt…
No matter how good a business is, if you pile on an unsustainable debt load, it is possible to sink it.
And those who pile on the debt get to enjoy the spoils of the financial restructuring.
Of course. My point was quite simply that the business and debt were disclosed, and known, and people STILL invested their money behind that debt. It’s what makes a market…how much debt is “unsustainable” is often in the eye of the beholder.
how much debt is “unsustainable” is often in the eye of the beholder.
I disagree, RW; how much debt is sustainable depends on the consistency of a company’s cash-flows. Bond payments are binary things—they are either made on time, or they are not.
Go figure…
Netherlands on Edge of Economic Crisis; Unemployment Surges as Home Prices Collapse
Netherlands is underwater in more ways than one. Der Spiegel reports Underwater: The Netherlands Falls Prey to Economic Crisis
More than a decade ago, the Dutch central bank recognized the dangers of [the housing] euphoria, but its warnings went unheeded. Only last year did the new government, under conservative-liberal Prime Minister Mark Rutte, amend the generous tax loopholes, which gradually began to expire in January. But now it’s almost too late. No nation in the euro zone is as deeply in debt as the Netherlands, where banks have a total of about €650 billion in mortgage loans on their books….
By Victoria Cavaliere / NEW YORK DAILY NEWS
Thursday, December 27, 2012, 3:09 PM
Big names join the Mayors Against Gun Violence “demand a plan” campaign by taking a stand against assault rifles.
A long list of celebrities joined Mayor Bloomberg’s efforts to pressure Washington to pass gun control legislation that could prevent tragedies on the scale of the Sandy Hook Elementary School massacre.
Beyonce, Jon Hamm, Julia Louis-Dreyfus, Reese Witherspoon and Will Ferrell are among the celebrities who recorded a public service announcement sponsored by the group Mayors Against Illegal Guns.
CLICK HERE TO SIGN THE DAILY NEWS ONLINE PETITION TO BAN ASSAULT WEAPONS
http://www.nydailynews.com/new-york/beyonce-jon-hamm-stars-backing-gun-control-article-1.1228314 - -
———————————————————————————Posted: 9:36 p.m. Sunday, April 21, 2013
Reese Witherspoon charged with disorderly conduct
By JONATHAN DREW
The Associated Press
ATLANTA —
Oscar-winning actress Reese Witherspoon was arrested on a disorderly conduct charge after a state trooper said she wouldn’t stay in the car while her husband was given a field sobriety test in Atlanta.
Witherspoon was released from jail after the Friday morning arrest and was in New York Sunday night for the premiere of her new film “Mud.” She posed for cameras on the red carpet but did not stop to talk to reporters.
The trooper noticed the car driven by her husband wasn’t staying in its lane early Friday morning, so a traffic stop was initiated. Her husband, James Toth, had droopy eyelids, watery, bloodshot eyes, and his breath smelled strongly of alcohol, according to the report.
Toth told the trooper he’d had a drink, which Witherspoon said was consumed at a restaurant two hours before the traffic stop, the trooper writes.
Before the field sobriety test began, the 37-year-old Witherspoon got out of the car, was told to get back in and obeyed, the report said. After the “Walk the Line” star got out a second time, the trooper said he warned her that she would be arrested if she left the car again.
As the test continued, “Mrs. Witherspoon began to hang out the window and say that she did not believe that I was a real police officer. I told Mrs. Witherspoon to sit on her butt and be quiet,” Trooper First Class J. Pyland writes.
Toth, 42, was then placed under arrest. He was charged with driving under the influence and failure to maintain the lane.
At that point, the report says, Witherspoon got out and asked the trooper what was going on. After being told to return to the car, she “stated that she was a ‘US Citizen’ and that she was allowed to ’stand on American ground,’” the report states.
The trooper then began to arrest Witherspoon. The report says Witherspoon was resistant at first but was calmed down by her husband.
“Do you know my name?” Witherspoon is quoted as asking the trooper. She also said: “You’re about to find out who I am” and “You’re about to be on national news,” according to the report.
Toth and Witherspoon were then taken to jail.
A message left at the office of Witherspoon’s publicist, Meredith O’Sullivan Wasson, wasn’t immediately returned Sunday.
News of the arrest broke shortly before Witherspoon arrived on the “Mud” red carpet.
———————————————————————————-
In 2011, MADD served more than 63,000 victims and survivors of drunk and drugged driving crashes.
Internal MADD tracking data, 2002-2010.
In 2011, 9,878 people died in drunk driving crashes - one every 53 minutes
National Highway Traffic Safety Administration FARS data, 2012.
Almost every 90 seconds, a person is injured in a drunk driving crash.
Blincoe, Lawrence, et al. “The Economic Impact of Motor Vehicle Crashes 2000.” Washington, DC: National Highway Traffic Safety Administration, 2002. NHTSA FARS data, 2011.
MADD - Statistics - Mothers Against Drunk Driving
http://www.madd.org/statistics/ - 44k -
Good Question: How Many People Are Killed By Assault Rifles?
February 12, 2013 11:04 PM
The same story plays out across the nation. Of the 12,664 murders in 2011 reported to the FBI’s Uniform Crime Report, 6,220 were committed with handguns — about 49 percent of the total report.
By comparison, killers used a rifle on 323 people, 2.5 percent of all murders. Assault rifle murders aren’t split out, but it’s safe to assume it’s less than the 323.
Most put the number of assault weapon murders as between 1 and 2 percent of all murders.
In 2011, knives were used in 1,694 murders. Fists and feet were used in 728 murders, and blunt objects –like clubs, bats and hammers – were used in 496 murders.
http://minnesota.cbslocal.com/2013/02/12/good-question-how-many-people-are-killed-by-assault-rifles/ - 112k -
So, Reese Witherspoon and other big name stars along with Mayors Against Gun Violence “demand a plan” and are taking a stand against assault rifles which kill less than 323 people a year while she takes part in an activity that kills 9,878 people a year and injures 1 every 90 seconds.
One of the more interesting stats from “Freakonomics” is comparing the dangers of pools and guns.
If your kid goes to a house with a pool, they are something like 100x more likely to die from drowning than if they go to a house with a gun (and die from the gun).
Drowning is a nice quiet death, dying from a gun is loud and bloody. Consequently, MAP (mothers against pools) doesn’t exist.
http://www.kitco.com/ind/Hug/20130419.html
At this time gold is at $1422 (8:52 pm PST) Peter Hug’s column below. My emphasis in the text
Will leave the technical picture to the experts, but I suspect a close over$1,420 will be needed to scare the “computers” that are short. The demand for physical product, that we identified on Wednesday, has pushed gold over the $1,400 level. The demand from the retail investor, which in turn creates dealer buying to cover the positions, overwhelmed the bid side in Asia and then in turn when Europe opened. Based on the action, some pundits have suggested that this was demand from investors that missed the move when the metals were at these levels in 2011. Generally, retail investors do not buy when the price is inexpensive. They tend to buy when the hype is highest and sell when the capitulation ends. This buying indicates to me that there still exists substantial fear in the markets and the “better” picture that is being painted is not a simple landscape but rather a Picasso, open to interpretation. No-man’s land here for a trade after going long on Tuesday at $1,327. Sell stop at $1,388.
By Peter Hug
Global Trading Director
Kitco Metals Inc.
I may have to post this again tomorrow. It is a fascinating map of Where’s George data.
http://www.radiolab.org/blogs/radiolab-blogland/2013/apr/17/whom-do-you-hang-map-america/?utm_source=local&utm_media=treatment&utm_campaign=daMost&utm_content=damostviewed
Very cool project. Thanks for the link, Happy.
Furloughs to hit families with 2 government jobs hard
April 22, 2013
The federal government’s effort at cutting spending across the board is hurting a population once considered among the most financially stable — dual-income families where both partners are government employees.
Starting Monday, employees at agencies such as the Federal Aviation Administration and the Office of Management and Budget will be required to take unpaid days off, a consequence of the government’s sequestration budget cuts. The furloughs come on top of the first round of cuts that began March 1, and they will reduce the pay of some workers as much as 12 percent a month.
The FAA will furlough almost all of its 47,000 civilian employees for a day per pay period to meet $637 million in budget cuts.
The Department of Defense said it will furlough almost all of its 780,000 civilian workers to reduce its budget by $41 billion. Those furloughs will likely start in mid- to late June, and will require employees to take 14 days unpaid leave between the start date and Sept. 30, according to the department’s website.