Bits Bucket for June 5, 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
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Bloomberg
Yen Climbs as Stocks Slump After Abe Speech; Aussie Declines
By Emma Charlton & Mariko Ishikawa - Jun 5, 2013 1:03 AM PT
The yen strengthened versus the dollar and euro as Japanese stocks slumped after Prime Minister Shinzo Abe failed to provide additional detail on stimulus measures, boosting demand for safer assets.
Japan’s currency gained against 14 of its 16 major counterparts after the Topix index of shares dropped more than 3 percent. A volatility measure of Group-of-Seven currencies approached the highest since February. Australia’s dollar fell after the nation’s gross domestic product grew at the slowest pace in almost two years. Sweden’s krona weakened after the nation’s services sector contracted more than economists forecast last month.
“There’s general disappointment that Abe didn’t announce anything that was surprising or new,” said Jeremy Stretch, head of currency strategy at Canadian Imperial Bank of Commerce in London. “There’s some disappointment in Japanese stocks and that’s pushing the yen up. The Aussie is likely to remain pressured after the GDP (AUNAGDPC) data.”
…
The race to the bottom is a bitch!
I’ve been buying and selling Vale. It’s the biggest iron producer in the world but it’s based in Brazil. I bought at 14.40 and sold yesterday at 15.00, and picked up more today at 14.60. Gotta love that churn. Vale seems to me a good indicator that China’s building boom is over. So what’s going to be the next bubble that gets the funny money flowing around the world?
Vale seems to me a good indicator that China’s building boom is over ?
Seems like Germany & USA are the only ones left to roll over….
European Stocks Pare Drop as Investors Weigh Fed Stimulus
By Sarah Jones - Jun 5, 2013 1:47 AM PT
European stocks pared their decline as investors weighed comments by Federal Reserve policy makers on when to scale back the central bank’s bond-buying program. U.S. index futures and Asian shares slipped.
Tesco Plc declined 3.2 percent after the U.K.’s largest retailer reported same-store sales that fell short of analysts’ estimates. Man Group Plc (EMG) slumped 12 percent after the hedge-fund manager posted a decline in assets for its flagship fund.
The Stoxx Europe 600 Index decreased 0.1 percent to 299.28 at 9:45 a.m. in London amid concern that the Fed may soon scale back its quantitative-easing program. The equity benchmark earlier fell as much as 0.6 percent. Standard & Poor’s 500 Index futures retreated 0.1 percent, while the MSCI Asia Pacific Index tumbled 1.9 percent as Japan’s Nikkei 225 Stock Average slumped 3.8 percent.
“It’s very much sentiment about quantitative easing because that is going to be the key thing that will impact the markets,” Daniel Morris, market strategist at JPMorgan Asset Management told Mark Barton on Bloomberg Television in London. “If we do think, because of stronger payrolls numbers, that QE is going to slow down sooner than expected, you will see a bit of short-term weakness in the market because of losing that liquidity. Ultimately it’s a bullish signal.”
…
June 5, 2013, 5:10 a.m. EDT
Japan stocks sink on Abe speech, lead Asia losses
By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) — Japanese stocks swooned in volatile trading action Wednesday after Prime Minister Shinzo Abe’s blueprint to spur long-term economic growth fell short of expectations.
Most other regional markets declined after a weak lead from Wall Street overnight that kept alive concerns the Federal Reserve may taper its bond purchases, with Australian stocks sliding after the nation’s first-quarter growth came in below estimates.
In Japan, the Nikkei Stock Average (JP:NIK -3.26%) rose more than 1% as Abe began his much-anticipated speech, but staged a swift reversal within minutes before ending the session 518.89 points, or 3.8%, lower at 13,014.87. The decline was the fifth time in the last two weeks when the Nikkei fell more than 3% in a single day.
The dollar (USDJPY -0.25%) also charted a similarly volatile course, rising as high as ¥100.45 before sliding back to ¥99.57 by the time the stock market closed.
The sell-off came as Abe’s blueprint revealed plans to attract foreign funds, boost investment and wages, and revamp the structure of agricultural land. He also announced a proposal to allow the nation’s massive pension funds to increase their equity allocation.
“The market will be looking to hear more about his comments urging Japan’s public pension funds to increase their investments in equities and overseas assets,” said Stan Shamu, a strategist at IG Markets.
“The comments made by Abe today were not really a game-changer and disappointed a market which seems to have been positioned for a USD/JPY and Nikkei rally,” he added.
…
Japan stocks sink on Abe speech,
Good ol’ honest Abe….The buck stops there.
“He also announced a proposal to allow the nation’s massive pension funds to increase their equity allocation.”
Isn’t this what Wall St. was pushing back in 2005-2006? I think it was one of the main problems people had with the idea of putting SS funds into the stock market and it killed the Bush SS reform he was pushing after the 2006 election.
If Japan can pull this off I think we will see it here next.
Bill Gross and the ‘wounded heart’ of financial markets: a grim diagnosis
June 4, 2013, 7:45 AM
“Wounded Heart.”
That’s the gripping title of the latest investment outlook from Pimco’s Bill Gross, and it looks like he pulled out the medical books to diagnose the effect of all that easy money swashing around the global economy.
What exactly is the “heart” he’s referring to? The global financial system, which he says is ”beginning to resemble a leukemia patient with New Age chemotherapy, desperately attempting to cure an economy that requires structural as opposed to monetary solutions.”
…
So what are Gross’s structural solutions?
One solution that I can think of is either more jobs or a smaller labor pool. In those “good old days” of the 1950’s, what would the unemployment figure have been if all those housewives were actively seeking work?
i think folks who are receiving some sort of government assistance should be included in the labor pool.
what types of government assistance is debatable…i am not even sure of all the types. unemployment…most certainly…social security…maybe not.
i think folks who are receiving some sort of government assistance should be included in the labor pool.
A lot of them do have jobs. But yeah, those that don’t work at all should be included. If they were, we would probably be seeing official UE numbers more in line with those published by Shadow Stats and comparable with those of the Great Depression.
In those “good old days” of the 1950’s, what would the unemployment figure have been if all those housewives were actively seeking work?
They had no reason to work. One income was enough to support a family. What about not propping up the pricess artificially? What about letting your dollar is worth the same year after year?
There are 2 entities (government and fed) stopping economy from finiding its natuaral equilibrium. All we are is a casino econmy and most of you will lose if you play. The worst thing is you will also lose even if you don’t play. F U Bernanke!
Liberals:
We should go back to the good old days of the 1950s
Conservatives:
We should go back to the good old days of the 1950s.
Liberals Reply: RACISTS!!!!!
Can’t have it both ways kids. The 1950s were either a horrible time when only evil white men prospered and women were treated worse than under the Taliban…. **OR** the 1950s were totally awesome ‘n stuff since everyone had jobs and gas was 10 cents a gallon.
It’s either OR. It can’t be both.
It’s either OR. It can’t be both.
Really? I think it can be a little of both. But mostly it’s just a time that’s easy to look back on fondly for most people because of our position in the world at the time as the only country with a fully functional first world economy and a pretty good system for taking advantage of it.
The only people who look back on the 1950’s with fondness are senile.
They live in your skull rent-free.
It’s either OR. It can’t be both.
LOL, There is your problem. Open your mind grasshopper. Breath in…..(and then out). Relax and see the world in color or at least shades of gray.
Conservatives: We should go back to the good old days of the 1950s. Liberals Reply: RACISTS!!!!!
Same ol’ sh!t, different day.
Rio wants to go back to this? THE HORROR!!!!
http://www.huffingtonpost.com/chris-zepedamillan/romney-ryan-take-latinos-to-the-50s_b_1822218.html
“Given the GOP’s raging “War on Women,” it is not surprising that critics have argued that a President Mitt Romney would take us “back to the 1950s” on issues related to gender. But what would a conservative 1950s social agenda look like for Latinos today? Do the Republican Party’s policy positions from over half a century ago have anything to do with their contemporary legislative goals? Before we attempt to answer these questions, we should remember what life was like for most minority groups during this time in history.
The 1950s are often remembered as “Happy Days” for the country because the economy and family values were supposedly at their peaks. Pop worked hard and was able to provide a home, car, and annual family vacation–all on one income (!)–while Mom kept house by cooking, cleaning and making sure that Wally and little Susie were raised properly. This is the era that many conservatives are constantly saying they want to “take the country back to.” This is also a time that most minority groups recall with horror. “
No one thought fondly of the 50’s until the 1970’s.
“Pop worked hard and was able to provide a home, car, and annual family vacation–all on one income ”
good thing
“This is also a time that most minority groups recall with horror.”
bad thing
i swear…this “all or nothing/black or white/left or right/red or blue” mindset that political idolatry instills in folks is redonkulous.
No one thought fondly of the 50’s until the 1970’s.
Makes sense. But was it just boomer nostalgia or did something start to suck that used to be good?
“It’s either OR. It can’t be both.”
This is the sort of brain-wasting thought process which led the country to where it is right now.
Disagree.
The “natural equilibrium” is for the price of Needs to rise to what the market will bear. One need is housing. As more and more woman entered the workforce, the price of housing, especially in good school districts, rose. Two-income families paid the higher prices because they could, establishing those prices as the new normal. Now everybody has to do it. It started around the late 1970’s, long before the bubble or the propping. Elizabeth Warren documented it when she wrote The Two Income Trap in 2003 or so. Pre-bubble, pre-prop.
In fact, the true natural equilibrium of market forces is toward bimodal feudalism. The more wealth, or market share, or economies of scale, you have, the easier it is to acquire more of it, as a parabola. Thus corporations merge to monopoly, the rich can buy up the house and rent to the 99%, rent rises to where you need one, then two, then three incomes to afford it, to where the moneyed don’t have enough money to buy the game instead of merely playing it.
Do you seriously think that the Era of the Middle Class was a natural equilibriuam that happened by itself? It was achieved largely by massive government intervention, from Sherman Anti-Trust to Glass-Steagal to the Federal Highway system to agricultural subsidies to establishing the 30-year mortgage to oil tax breaks to social security to wiping out the factories in Europe. Remove the interventions, and you trend back toward feudalism. This is where we are now.
+1
In fact, the true natural equilibrium of market forces is toward bimodal feudalism.
We’d get our total feudalism if the government would “just get out of the way.”
(The middle-class) was achieved largely by massive government intervention, from Sherman Anti-Trust….
Yes. Also by massive wealth redistribution through highly progressive taxes whose funds were then invested in the American people and public projects.
Now for 30 years we’ve had massive wealth redistribution from the people to the very rich. Trickle-down and not trickled down. Trickle down has flooded up. It has flooded money from the 90% up to the .05%. (people can plug in your own %’s there but that’s close)
Do you seriously think that the Era of the Middle Class was a natural equilibriuam that happened by itself?
A very good point. History shows that when we had unfettered, unregulated capitalism that we had Robber Barons and grinding poverty.
“Yes. Also by massive wealth redistribution through highly progressive taxes”
stautory rate and effective tax rates are not the same. see the chart below:
http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=456
the average individual effective tax return for the top 1% from 1979 - 2009 is about the same.
i think the highest progressive income tax rate in 1979 was around 70%.
The “natural equilibrium” is for the price of Needs to rise to what the market will bear. One need is housing.
Wrong. The price needs to drop to what the market can support.
Do you seriously think that the Era of the Middle Class was a natural equilibriuam that happened by itself?
No it wasn’t. We are living the consequences of these forced “solutions.”
They had no reason to work. One income was enough to support a family.
But people always can spend more. From what I’ve heard they weren’t welcome in most jobs once the GIs came home and there was a lot of social pressure to stay home even if they wanted to work.
Please remember that women held the civilian jobs during the 1940’s while men were off fighting WW2. They took five to ten years off to raise children, but many of them worked sporadically throughout the fifties and certainly the sixties to supplement the family income — as did many of their kids.
By the time the Boomers reached working age, the competition engendered in their sheer numbers had bumped prices for housing and necessities so high that two (or more incomes) per household were a necessity.
Allena, did the women in the 50’s think of it as “taking time off” to raise the kids; that is, did they assume they would work when the kids entered school? I didn’t see all the episodes of Leave it to Beaver, but I didn’t pick up that June Cleaver was trying to keep a skill current, or was going to look for work when the Beav got older.
Another question: You’re implying that these Rosie the Riveters did the homemaker thing, tried to go back to work, and were denied. But were these homemakers the exact same women as the Rosie the Riveters? We hear that the women of the ~1955 were getting married during college, when they were 20-22 years old. If they were the same batch of women, then either they had been young teenagers during the war years, or they were married and having kids when they were 35-36. There’s a half-generation discrepancy somewhere.
By the time the Boomers reached working age, the competition engendered in their sheer numbers had bumped prices for housing and necessities so high that two (or more incomes) per household were a necessity.
Part of what bumped up those prices were the oil crises of the 1970s which increased the price of nearly everything.
My mother and all her college-educated friends worked throughout my fifties-sixties childhood, albeit part time or sporadically in between gestating babies and nursing them. (Most had four or five children.)
They were nurses, social workers, teachers, pharmacists, or front and back-office staff in their husband’s businesses and medical practices, so were able to have flexible schedules, but for at least the first fifteen-twenty years of their marriages, they worked to supplement the family income during school hours, and expected us, their kids, to do so after school as well.
The oldest child in the family (me) was expected to act as surrogate mom and buzz-kill for those hours of overlap between their out-of-the-house job and mom-hood.
I got my first SSN-required job at 14.5, as did all four of my younger siblings. (Ten year age span from oldest to youngest, which could account for your missing decade?)
My oldest sister was surrogate mom my two other sisters and I. She still resents it. We all worked, just as you did. I got my first job when I was 13 at a craft company, making samples. I cleaned house, too, and then at 16 got my first ‘real’ job at Burger King!
read an article once correlating the devaluation of the dollar with social movements.
women entering the workforce for example.
Michael,
Correlation is not necessarily causal. In the case of women entering the workforce en masse in the 1970’s, it’s definitely a response to:
1. Young women (we had the pill, remember?) finally being admitted to previously all-male elite universities and employment institutions
2. Graduating from them into an increasingly competitive social environment due to the near-exponential demographic growth of young people in the 1950’s-60’s.
It was not possible then for the typical single 20-something to afford an apartment, let alone a household, be they male OR female.
Recall the popularity of communes. Hint: They weren’t so much a matter of personal choice, as of economic necessity.
I’m feeling very conspiratorial today.
Women’s Liberation Movement Rockefeller Funded
http://www.youtube.com/watch?v=sBSiAALhjzE
Russo is talking about a conversation with Nicholas Rockefeller in regard to funding the women’s movement.
what would the unemployment figure have been if all those housewives were actively seeking work ??
The real question in my mind is why is it near impossible to have stay at home mom’s anymore…??
And here is the answer from the Lady;
the competition engendered in their sheer numbers had bumped prices for housing and necessities so high that two (or more incomes) per household were a necessity
dave ’cause the house is TOO BIG….eg too expensive….so put 5 people in 1200 sqft or less then compare…..we were outside a lot!!!
There is no global financial system. There has only ever been a cabal of international banksters and would-be Evil World Rulers. Unsurprisingly, they can’t seem to figure out how to actually pull it off.
This is encouraging.
http://armstrongeconomics.com/2013/06/02/new-world-order/
Are you financially prepared for a massive shipboard fire of inflation?
June 4, 2013, 8:01 p.m. EDT
Fed’s Fisher sharpens attack on QE
Central bank may be ‘pushing on a string’
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) — Continuing the Federal Reserve’s asset purchase program risks the “debasement” of the dollar, high inflation and “the ruination of our economy and lifestyle,” a central bank official said Tuesday.
Richard Fisher, president of the Dallas Fed, has been no fan of the Fed’s easy policy stance, but his warnings about the possible “tragic” consequences of quantitative easing, to a research firm in Toronto, were more strident than ever.
The first order of business in Washington is for lawmakers to get control of “rudderless” fiscal policy, Fisher said.
Without a budget deal, the cheap money the Fed has made available will not be put to use, he said.
“Until then, I argue that the Fed is, at best, pushing on a string and, at worst, building up kindling for speculation and eventually, a massive shipboard fire of inflation,” Fisher said.
…
Continuing the Federal Reserve’s asset purchase program risks the “debasement” of the dollar, high inflation and “the ruination of our economy and lifestyle,”
Debasement of the dollar compared to what? The Yen? The Real? The Pound? Gold? Houses?
“the ruination of our economy and lifestyle,”
The ruination of our economy and lifestyle where half the workers make less than $500 a week and where just 6 of the WalMart family have more wealth than 100 million Americans combined? That lifestyle and economy? We can’t ruin that.
and where just 6 of the WalMart family have more wealth than 100 million Americans combined?
Robber Barons are an American value.
Robber Barons are an American value.
I don’t like Walmart but I still think thay the Walton families earned their money more honestly than Buffett, Romney, Clinton and Gore combined together.
“We can’t ruin that.”
you don’t think it can get any worse?
No, I am not. I have been preparing for deflation and a collapse in house prices.
Did I get it wrong?
Wait for it…
Original 2006 gangsta here. I’m waitin’…
I’m unsure which way it will go, deflation or ’shipboard fire’ level inflation. Diversified so I’ll survive either case, but won’t hit the jackpot.
I’m sure there will be some that play the situation right and will bask in the glory of their wisdom and riches, and others that will get wiped out. I’d rather go the boring safe route of diversification.
I’m inflation hedging with a mortgage.
I’m deflation hedging with a little cash in the 401K waiting to pounce on a real crash.
LOLOLOL
You go Junkie!
I’m inflation hedging with a mortgage.
your mortgage won’t protect you. in fact, it might bury you.
do you know what protected mortgages in the past? it was a prospering economy that permitted wage inflation. but that isn’t happening now. the economy is deteriorating. in many cases wages are actually declining, even as the dollar declines. mortgages may become death traps instead of saviors.
Buying a home is a hedge against classical inflation. With classical inflation, wages inflate with prices.
But the definition of inflation doesn’t matter. The whole bloody point of a mortgage is that your PI never goes up. You don’t NEED wage inflation to stay in the house. You’re still okay if you don’t get a raise. If you’re reasonably below your means, you’re still okay even if your wages decline a little bit. If you put money down and stay in the house for a few years, you’re still okay even the wage decline outpaces the mortgage (unlikely) and if you have to sell the house for a little less than what you paid for it.
The chances of a mortgage being a deflationary deathtrap is less than it serving as an inflationary hedge.
The whole bloody point of a mortgage is that your PI never goes up. You don’t NEED wage inflation to stay in the house.
what happens if food and energy prices constantly increase and your income doesn’t? it means you have less money to pay your mortgage with. if the trend continues long enough, you won’t be able to pay your mortgage.
If you’re reasonably below your means, you’re still okay even if your wages decline a little bit.
not if the price of everything else continues to rise.
If you put money down and stay in the house for a few years, you’re still okay even the wage decline outpaces the mortgage (unlikely) and if you have to sell the house for a little less than what you paid for it.
in this scenario, how has your mortgage protected you?
The chances of a mortgage being a deflationary deathtrap is less than it serving as an inflationary hedge.
it doesn’t have to be a deflationary death trap. my point was it can be a death trap in price inflation.
what happens if food and energy prices constantly increase and your income doesn’t?
The same thing that happens when you rent? Assuming of course that rents won’t increase.
The same thing that happens when you rent? Assuming of course that rents won’t increase.
oxide’s point was that a mortgage protects from inflation.
my point is that it won’t protect in a declining economy like we have now.
You can adapt on the fly by renting something cheaper. Not enjoyable, but preferable to financial implosion.
Oh.my.god…….
She is stoopid
“oxide’s point was that a mortgage protects from inflation.”
As I understood it, she said classical inflation, meaning wages and prices both rising. In this situation, rents increase and nominal home prices increase. This was the situation through much of the 70s and 80s. My folks’ 30 year mortgage on a 3 BR house was less than my apartment rent by the end of that time.
In a Detroit style deflation, a mortgage does not protect you and can become an albatross. In a Pittsburgh style steady state economy with small inflationary or deflationary wobbles, a mortgage is no worse than renting.
If you stay in one place, buying is a winning strategy more often than renting.
Nonsense.
And go learn what inflation is.
As I understood it, she said classical inflation, meaning wages and prices both rising.
she said ‘classical’ inflation to qualify her answer. what she meant was ‘price’ inflation. there are many types of inflation. tire inflation? universe inflation? monetary inflation? price inflation? one type has nothing to do with the other. from her context i knew she meant price inflation. price inflation can’t be qualified by wage inflation, because wage inflation doesn’t always happen. it can’t be qualified by monetary inflation either for the same reason (and others).
Buying was a winning strategy for my folks. For my sister, it was a losing strategy in one market (smaller) and a winning strategy in another (larger). Both of them live in SFH and their housing costs (including maintenance and taxes) are about half of what mine are (SFH rental). My folks have been living in the same house since the mid 1950s. They have had no mortgage since the mid-1980s. My sister has been living in the same house since the early 1990s. Their timing was good.
In most places, the market is too uncertain now for me to believe that buying is a good strategy. There are exceptions where it may make sense, but it is risky.
There have been and may still be places where rentals are unavailable. I met someone in the 1980s who bought and lost money in small towns in the Midwest because there were no rentals available. I was surprised. I had never lived anywhere that you could not find a place to rent.
Don’t tell me what I “meant.” Whac-bear seems to talk in classical economics, so I answered with application to classical inflation. I qualified later when I realized that you had failed to make that connection.
The mortgage protects me in that my PITI will not rise, while rent will rise. My PITI eats the same share of income ever year. Rising rent will eat an increasing share of income every year. And that’s if other prices don’t rise at all. If other prices rise, a renter will run out of money faster.
Fact:
Over 30 years, a fixed mortgage payment stays the same.
Fact:
Over 30 years, rents will increase. Might not increase every year but no reasonable person can say that rents on average in 2043 will be the same as rents in 2013.
So if you want an inflation hedge, a fixed 30 year mortgage is the way to go.
Don’t tell me what I “meant.”
fine. then you meant you’ll only be protected from price inflation when accompanied by wage inflation, which means you won’t have much protection in this economy.
a weakening economy means a weakening dollar. that doesn’t mean that your wages will increase along with the falling dollar. in most cases it means just the opposite. on top of lower wage jobs, there will be fewer of them. none of that will stop rising prices. it just means that more business will have to close their doors.
your mortgage is little protection now, and you’ll find that out.
Fact:
Over 30 years, a fixed mortgage payment stays the same.
truth: this isn’t 30 years ago.
Fact:
Over 30 years, rents will increase. Might not increase every year but no reasonable person can say that rents on average in 2043 will be the same as rents in 2013.
truth: what you just stated isn’t a fact. whether it’s truth or not remains to be seen.
anything in the future can’t be a fact. a fact is something done.. finished.
So if you want an inflation hedge, a fixed 30 year mortgage is the way to go.
you’ll find out if the economy continues to weaken (which is a near certainty) that a mortgage won’t protect you against price inflation. it will damage you in the sense that dollars will be harder to come by even though they’re worth less..
Fact:
Over 30 years, a fixed mortgage payment stays the same.
True. Taxes and maintenance will generally increase. Mortgage is not the only component of housing costs for buyers. Whereas for renters, taxes and maintenance are included. So some of rental increase is due to increased taxes and maintenance.
People who bought before 1985 (in most markets) had/have lower housing costs than those who rented from 1985 to present. I am not certain that the same will be true going forward. Demographics partly drove the increase in the earlier timeframe as boomers matured into house buyers. Demographics are a headwind now.
Fact: Locking into a mortgage at current massively inflated prices of resale housing is locking yourself into losses from which you’ll never recover.
You silly liars seem to run from the price issue.
In an inflationary environment, my house value will go up and I will have equity to sell if I have to. Renters don’t have equity.
If my house value goes down, then at least my taxes will go down too.
The wild card is maintenance. But remember this: rental housing will deteriorate just as SFH do. Rents will increase to upkeep those old rentals. The stuff that might not deteriorate is the new luxury Class A high-rises. And few can afford those anyway.
And renters monthly costs are half yours.
In an inflationary environment, my house value will go up and I will have equity to sell if I have to.
even if your home’s price goes up in a rising market, its value still goes down. and if a deteriorating economy forces you to sell, it will force many others to sell also, and you will have lost most if not all of your equity to falling prices. either that or nominal dollars will be worth much less and the equity you get out won’t buy near what it would before.
Renters don’t have equity.
they also don’t have taxes, maintenance and interest to pay.
If my house value goes down, then at least my taxes will go down too.
don’t count on it. desperate bureaucrats can just raise the mill rate. they did it to me even after they promised they wouldn’t.
The wild card is maintenance. But remember this: rental housing will deteriorate just as SFH do.
deterioration is not the renter’s problem, it’s the owner’s problem.
Rents will increase to upkeep those old rentals.
rents can’t rise above what the majority can pay. and in a bad economy more and more people can afford to pay less and less.
The stuff that might not deteriorate is the new luxury Class A high-rises.
things deteriorate at different rates, but EVERYTHING deteriorates.
And few can afford those anyway.
if too few can afford them, the prices will come down.
We have seen this type of migration before…Is it about jobs ?? Lifestyle ?? Time management ?? All the above ??
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=5&cad=rja&ved=0CEMQFjAE&url=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2Fe213f016-c9d7-11e2-af47-00144feab7de.html&ei=rTyvUZz2Ku_EiwKfzoCQBA&usg=AFQjCNG1yLrsFz7tBIud0_3Qm40kKKPtog&sig2=4WgbpA2BlXnt3hHUnfHO6Q
Financial Times link no workie. Could you summarize the article please?
It worked for me Goon…You need to answer some stupid little question to get the entire article…
June 4, 2013, 5:35 p.m. EDT
FHA could lose $115B in severe case, test finds
By Ruth Mantell
WASHINGTON (MarketWatch) — A stress test found that a federal mortgage insurer could face losses of up to $115 billion over 30 years under “severe economic circumstances,” far higher than an estimate included in the agency’s annual report, according to recent letters from an oversight panel of U.S. lawmakers. As reported earlier in The Wall Street Journal, the letters indicate that independent actuaries working for the Federal Housing Administration projected a $115 billion loss based on a model in accordance with the Federal Reserve’s stress test for financial institutions. That result was far wider than a projected loss of $13.5 billion over 30 years that FHA presented last year in its fiscal 2012 report, an estimate that was recently narrowed. In a May 29 letter to FHA Commissioner Carol Galante, U.S. Rep. Darrell Issa, a Republican of California and chairman of the Oversight and Government Reform Committee, wrote that FHA was “determined to avoid disclosing the magnitude” of the projected losses, and that Galante may have personally directed the removal of the results. “Although the…results were included in several early drafts of the actuarial report…it appears that FHA directed the results to be removed from the final report presented to Congress,” Issa wrote. The oversight panel is investigating FHA’s fiscal health and gave the agency a June 12 deadline to produce documents about the preparation of the fiscal 2012 actuarial review.
Yes, the market is corrupted and we all know it
June 4, 2013, 4:13 PM
By Cody Willard
I have to say, despite knowing how “out there” by conventional standards much of Marketwatch’s and my own readership is, I am shocked at the results of our poll yesterday in which we asked, “Is the entire stock market (and the system it supports) completely corrupted?”.
I take offense to the idea that any of us have “radical viewpoints” on the political system status quo when the political system status quo is in the strange state it is today, where it’s neither a democracy nor a republic nor an economy built on socialism, nor communism, nor capitalism as currently defined. Bombings and 60,000 page health-care legislation written by lobbyists and drones and wars and energy subsidies and bailouts and secrecy and whistle-blower-persecution and Too-Big-To-Prosecute, all of which are seemingly “normal” today could be considered “radical” by both liberal and conservatives if you think about it.
At any rate, here are the results from the poll. More than 1,300 of you answered and most of you, almost 9 out of 10 of respondents, agree that there’s no saving the system.
Is the entire stock market (and the system it supports) completely corrupted?
Yes, it’s legalized theft. (76%, 1,035 Votes)
No, but it will be soon. (9%, 116 Votes)
No, and the system can still be saved. (8%, 111 Votes)
The system and the market are fine! (5%, 72 Votes)
No, and Democrats can still save it. (1%, 13 Votes)
No, and Republicans can still save it. (1%, 9 Votes)
Total Voters: 1,356
…
pretty much confirms what I have been sayn. It is the folks with the inside information that are making the money. They will leave you high and dry.
azdude
Absolutely.
‘They will leave you high and dry.’
The fine print allows them to do that and I don’t doubt for a second they will not become altruistic. Why should they?
Is 1356 a statistically significant sampling size? I don’t believe so.
The blogosphere has definitely turned dark in attitude. But the average person out there is still clinging to a Disney ending and hopes of deux ex machina. Can’t believe the idiots out there still clinging to the market numbers as evidence the worst is behind us.
That’s the same sample size as most election polls, and those get pretty close.
I would question whether the poll is significantly random. It appears to be a voluntary poll of readers.
He’s an optimist.
CONVERSATION AIR DATE: June 4, 2013
Former Reagan Budget Director Argues Against Bailouts, for Financial Discipline
SUMMARY
In “The Great Deformation,” David Stockman, former budget director under President Reagan, makes an argument against government economic intervention. Economics correspondent Paul Solman interviews Stockman on why he believes the U.S. bailout of banks after the 2008 financial meltdown perpetuates an unfair economic system.
JEFFREY BROWN: Next: another economic meltdown. That’s the dire prediction of a former White House budget director, who argues in a recent book that Wall Street and Washington are broken.
NewsHour economics correspondent Paul Solman has the first of two takes on the government’s role in the economic recovery, part of his regular reporting: Making Sen$e of financial news.
IN-DEPTH COVERAGE
PAUL SOLMAN: Libertarian David Stockman has been a controversial figure since he quit the Reagan administration as budget chief in 1985, blaming it for failing to take deficits seriously. He became rich and legally embroiled as a leveraged buyout financier. He faced accounting fraud charges that were later dropped.
Now he’s become visible again as author of “The Great Deformation,” a hefty screed that attacks the left and right alike. But, mainly, it attacks government economic intervention. It begins with the crash of ‘08.
Stockman thinks it was long overdue.
DAVID STOCKMAN, Former Reagan Administration Budget Director: That was Mr. Market bringing discipline, bringing resolution to very reckless financial behavior. We should have let it continue. Goldman would have gone down. Morgan Stanley would have gone down. It would have burned out there. It wouldn’t have spread to Main Street. The Main Street banks were in good shape. We basically made a mockery out of free markets and financial discipline, and we will never come back.
PAUL SOLMAN: But the theory of the time was that, because large financial institutions were so interconnected with one another, that if one went down, like Goldman, and owed lots of money to lots of others …
DAVID STOCKMAN: Right.
PAUL SOLMAN: … those others would go down, and dominoes.
DAVID STOCKMAN: Right. Well, that was the common theory, the contagion effect. There is no economic basis in history for the idea of contagion.
PAUL SOLMAN: Economic historians point to the onset of the worldwide Great Depression of the 1930s as evidence of contagion, but Stockman thinks they’re flat-out wrong about that, and wrong about the danger, five years ago, of contagion leading to a financial collapse.
Moreover, government, as the lender of last resort, he says, just makes matters worse; we shouldn’t have bailed out the banks or AIG.
And you think we shouldn’t have bailed out the auto industry either?
DAVID STOCKMAN: No, absolutely not. When we bailed out GM, the only thing we did was move 40,000 jobs from below the Mason-Dixon Line, where they would have been produced in Hyundai plants, or Honda plants, or Toyota plants, or BMW plants, to north of the Mason-Dixon Line. It was all about the Electoral College; it was not about jobs.
PAUL SOLMAN: But it would have been traumatic to Detroit and everybody who had an auto job.
DAVID STOCKMAN: Well, of course. But if we’re going to say that Washington will rescue anybody who is big and noisy and threatens a trauma, then we’re going to have total socialism, we’re going to have an ossified economy, and we’re going to have crony capitalism like you have never seen. Money will dominate everything, and we crossed that Rubicon when we bailed out Detroit in 2008.
PAUL SOLMAN: What do you mean exactly by “crony capitalism,” particularly if you’re including the United Auto Workers among the cronies?
DAVID STOCKMAN: Crony capitalism tries to get a different outcome than would occur on the market by using the tools and machinery of government.
As long as you want the government intervening at will any time there’s an emergency, a crisis, a threat of something going wrong, then money will win, because they will hire the lobbyists, they will hire the lawyers and the accountants, and all the rest of them, and you will get stupid things like Washington bailing out Goldman Sachs, and having Goldman come back within one year with $28 billion of surplus.
PAUL SOLMAN: So, you think our economy, perhaps our society as a whole, is on the one hand wussified — we can’t take any pain — and, on the other hand, controlled by a group of people in whose interests it is to preserve things as they are?
DAVID STOCKMAN: Sure. It’s two sides of the same coin.
The purpose of Washington is to prop up the powerful. If you’re running a small business in Indiana, they’re not going to bail you out. You have to have size. You have to have clout. Essentially, we have a very unfair system today where the bus drivers are paying taxes, so that we can give Social Security to old people that are rich, and we can bail out companies like G.E. Capital and Goldman Sachs and AIG and all the rest of them that never should have been near the taxpayers’ dollar.
So we would have had a serious recession, but no Great Depression, no black hole.
PAUL SOLMAN: But if you were in government then, you would have been willing to roll the dice on it?
DAVID STOCKMAN: Absolutely, because we’re in serial bubbles.
…
READ: Paul Krugman on Debt, but Are Soaring Interest Rates Running Against Him?
It all comes back to not Bailing out the speculators of AIG but should have bailed out CIT which provided loans to small businesses and advanced payments on receivable to ease cash flow problems.
It was small business that were collapsing…shipping companies could not guarantee letters of credit…so companies like Dry Ships went from over 100 to 3
There should not have been any bailouts. Your reasoning is not better than the reasoning used at the time, you just favored a different bailoutee.
“There should not have been any bailouts.”
+1 There should have been arrests at all levels from appraisers and realtors and mortgage brokers all the way up the food chain to the investment bankers and financial ratings agents. Fraud and racketeering.
Hi Z i stick by my CIT claim…they did nothing wrong but got caught up in the tidal wave, and it was small business that got hurt the most
So I agree no bailout to the criminals that caused this..
But the collateral damage to CIT and the shipping companies was astronomical.
Your kid asks you for a hundred bucks for a date, so you say “Get a part-time job, kid. I ain’t paying for your date!” Then the kid gives you the sad-dog look and says “pllleeeeeeeze”. So you give him a hundred bucks, and a week later, he asks for another hundred bucks.
What do you do?
Global Economy
Japan Fires ‘Third Arrow,’ but Will It Work?
Published: Wednesday, 5 Jun 2013 | 2:03 AM ET
By: Dhara Ranasinghe | Senior Writer
Japan’s Prime Minister Shinzo Abe on Wednesday unveiled a long-term plan to revive a weak economy, with economists saying more detail and implementation are now essential to prevent the strategy from failing as so many efforts to rejuvenate growth have done in the past.
Abe pledged to raise incomes by 3 percent annually over the next decade and set up special economic zones to attract foreign investment. He said the retail electricity market would be fully liberalized and he would aim to boost power related investment to 30 trillion yen ($300 billion) over the next 10 years.
Most of the measures had been flagged by the local media and there was some disappointment in markets that Abe did not announce bolder reforms in areas such as the labor market. The Nikkei stock index closed down 3.8 percent and the yen, which has weakened sharply this year on aggressive monetary easing in Japan, firmed.
(Read More: UBS Warns of ‘Abegeddon’ Risk in Japan)
“Every prime minister in the last 20 years has had an economic growth plan, the key is implementation,” Bank of Singapore’s chief economist, Richard Jerram, told CNBC Asia’s “Cash Flow”.
…
If you buy a house now, you will be competing with the biggest sharks on Wall Street. These folks will happily take the money and run in a heartbeat, leaving you holding the bag on a 30-year mortgage to pay off a depreciating asset.
Private Equity
June 3, 2013, 7:23 pm
Behind the Rise in House Prices, Wall Street Buyers
By NATHANIEL POPPER
The last time the housing market was this hot in Phoenix and Las Vegas, the buyers pushing up prices were mostly small time. Nowadays, they are big time — Wall Street big.
Large investment firms have spent billions of dollars over the last year buying homes in some of the nation’s most depressed markets. The influx has been so great, and the resulting price gains so big, that ordinary buyers are feeling squeezed out. Some are already wondering if prices will slump anew if the big money stops flowing.
“The growth is being propelled by institutional money,” said Suzanne Mistretta, an analyst at Fitch Ratings. “The question is how much the change in prices really reflects market demand, rather than one-off market shifts that may not be around in a couple years.”
Wall Street played a central role in the last housing boom by supplying easy — and, in retrospect, risky — mortgage financing. Now, investment companies like the Blackstone Group have swooped in, buying thousands of houses in the same areas where the financial crisis hit hardest.
Blackstone, which helped define a period of Wall Street hyperwealth, has bought some 26,000 homes in nine states. Colony Capital, a Los Angeles-based investment firm, is spending $250 million each month and already owns 10,000 properties. With little fanfare, these and other financial companies have become significant landlords on Main Street. Most of the firms are renting out the homes, with the possibility of unloading them at a profit when prices rise far enough.
While these investors have not touched many healthy real estate markets, they are among the biggest buyers in struggling areas of the country where housing prices have been increasing the fastest. Those gains, in turn, have been at the leading edge of rising home prices nationwide.
Some see the emergence of Wall Street buyers as a market-driven answer to the nation’s housing ills. Investment companies are buying up rundown homes at a time when ordinary people can’t or won’t.
Nationwide, 68 percent of the damaged homes sold in April went to investors, and only 19 percent to first-time home buyers, according to Campbell HousingPulse. That is helping to shore up prices and create confidence in the broader markets.
“When people write the story of this housing recovery, these investors will be seen to have helped put the floor under the housing market,” said David Bragg, an analyst at Green Street Advisors. “In some of the key markets, that contributed to the recovery.”
…
This was an accurate statement 10 months ago, but now it looks like ‘Elvis has left the building’. Since the ‘Big Guys’ usually have friends on the inside who tip them off in advance, I wonder what they have already been told that we don’t know yet? Whatever is coming, it appears that the ‘Big Guys’ are getting the hell out of housing- and fast. You know how, right before a tsunami hits, the ocean quietly recedes waaaaay back from the beach?
http://www.zerohedge.com/news/2013-06-04/housing-bubble-pop-alert-colony-pulls-ipo-market-conditions-blue-mountain-rushes-cas
“…One can make the argument that some have already felt the early tremors: late last year it was Och-Ziff, one of the original entrants in the REO-to-Rent business who called it quits as the returns it was generating from rental income were “less than expected.” Then just last week we wrote about Carrington, an early landlord investor backed by OakTree, which too decided to quietly slip out the back exit. Carrington’s memorable quote still haunts us: “There’s a lot of — bluntly — stupid money that jumped into the trade.”
Yes there is.
Which brings us to tonight’s news…”
The Big Boyz were playing bottom feeder to maximize ROI, simple as that. AZ NV FL had max ROI, so they started there. As time went on, the prices rise asymptotically rose to some natural maximum governed by FHA and J6P, and ROI dwindled. The Boyz probably watched prices and ROI closely. When ROI dwindled below optimum, the Big Boyz said, time to sell.
The Boyz are leading, and the general public and the media
are following about 120° out of phase. The Boyz are selling into the last 60°of upswing.
The end of the price rise is near. The cash has stopped fueling it, and there is no secondary mortgage market to fuel it. Question is: will prices crash or simply plateau? My guess says plateau. The last crash was because of NINJA-have-to-sell. We don’t have that now.
Anything……. anything to avoid reality…..
The denial of obvious reality is one of the hallmarks of a true mania. Its the ‘crazy’ that makes it good!
No, no NINJA this time. Now we will have f@cked flippers and huge profit-oriented entities holding empty, deteriorating assets with significant carrying costs and no buyers/renters at their desired price. Both groups will want to liquidate these non-performing assets, recover all that they can and put that money ‘to work’ at some other table in the casino. They will be natural competitors. The REIC and .gov will want them all to act in lockstep as a bloc, continuing trickle them out and keeping prices inflated. But its not Fannie and Freddie any more. Its a bunch of individual, cash, private investors who will all act in their own best interests. And they all know that, “He who sells first, gets most”. Stand by…
BINGO.
The first to head for the exit wins. And that is key to this entire “housing recovery” fraud foisted on the public.
Yeah, buddy! The Bernank found his ‘Greater Fool’- the hedgies. It took a lot of hype, market pumping and money to whip the feeble-minded back into a froth, but they got the village idiots gibbering again. Then once the ‘buzz’ was in the air, came the ’special deal’; buying in large blocks direct from the GSEs, double-secret-probation-pricing, riches beyond your wildest dreams… but you gotta’ pay me in cash. Yes, the cheese in the mousetrap is always free.
But the question is, will we bail out the big investors at taxpayer expense?
But the question is, will we bail out the big investors at taxpayer expense?
Don’t we always do that?
So far.
But the question is, will we bail out the big investors at taxpayer expense?
Yes, yes and YES!
Will they bail them out? I’m not so sure. The bail outs were about leveraged credit and knock-on effects if the creditors (banks) had to absorb losses. Now its just a pool of cash from poor-sap rich guys. The government has no “moral obligation” or mandate to bail out hedge fund fat-cats. See? They found their patsy. Their “Greater Fool”.
Not so sure…that’s their base, isn’t it?
Hedge funds are very poorly placed in Washington to get an actual bailout. Their method is to get a subsidy on the front end (special tax treatment, incentives to purchase assets, etc.). When the people who provide the subsidies you already have, spend 50% of their time screaming about bailouts and the other 50% talking about cutting government spending….well….you get the picture.
Not that it couldn’t happen. I don’t put anything beyond their lobbyists (they pay for the best), but it would be a hard, uphill climb, probably led by the organizations that hold the largest volumes of interests in the hedge funds - colleges, private foundations and pension funds.
I thought the bail outs were for the benefits of the pass throughs. (did I use the right term….3rd party recipients mostly in Europe/Asia?) IE, who would have gone down if AIG wasn’t rescued?
“who would have gone down if AIG wasn’t rescued?”
Goldman. Maybe not all the way down and out, but it would have been a disaster for them.
I thought the bailouts were issued because the banks had their claws into Main Street. Kill the kidnapper and the hostage dies. Or at least that’s how they sold it to the public.
Now, as the cigar guy says, the bagholders are just guys who now have $8 billion in cash instead of $12 billion. Sure, it’s a “financial bath,” but it cuts into savings, not into the food budget like it did in 2008. No loans or foreclosures or debt or have-to-sell. They simply eat the loss the same way that I eat the loss on a pair of shoes that I buy the week before it goes on sale.
Look in the mirror and you’ll see the bagholder.
So Donkey……
Seeing as you got suckered into paying a massively inflated price for a what is always a depreciating asset, when are going to come clean and get honest about what you paid?
What are you so afraid of Donkey?
Keep in mind, too, that Dick Cheney and Bandar Bush received 5.6 Billion USD from AIG on failed bonds for their headquarters in Dubai. Perhaps that may have influenced the decision to bail AIG out?
Interesting comment Oxide. I would tend to think that rather than the NINJA impetus, the Boyz have a need to turn a profit for their shareholders, and like most/all of corporate America they’re not looking much farther than the current quarter.
The houses can often be a money loser due to maintenance costs etc, so I can see the Boyz cutting their losses just as fast.
Maybe, Richardvs, But if they all decide to cut their losses at once, and prices drop, they will immediately pull those houses from the market and simply sit on them, because it’s less of a loss than selling. They can probably recoup the maintenance cost by renting the place out. It’s easy to cash flow on a rental if you own the place outright.
Oxide:
Your guess is that the price of your house will not go down. If “Da Boyz” just created their own bubble, and now they are selling into it, then prices must go down. I just don’t know how much drag there will be on it.
Different this time. Will the outcome be different also ?
“The last time the housing market was this hot in Phoenix and Las Vegas, the buyers pushing up prices were mostly small time. Nowadays, they are big time — Wall Street big.”
The economy is set-up for growth. Growth comes from having alot of kids not happening.
They must know this and therefore all the pushing on the string money creation won’t work.
How do you know they won’t go the nuclear option and allow millions to emigrate to the US ? In Costal CA many of the homes are being bought by foriegners, will this trend spread ?
Wall street outsourced US jobs why would they hesitate to insource buyers of all the homes they now own ? They can get laws changed if it works to there advantage.
Random thoughts from the crowded coast where HB2 is well under way.
The economy is set-up for growth. Growth comes from having alot of kids not happening.
Very true. We’re almost a decade into a birth rate crash.
No problem, we can always import “consumers”.
Immigration is flat to slightly negative and population growth is at the lowest point in US history. Combined with massive excess housing inventory and demand at 17 year lows, housing price declines are on the menu for decades to come.
Immigration is flat to slightly negative
According to wikipedia we’re admitting 1 million legal immigrants per year. I’ll bet that if we made it easier to get a green card that the number would grow quite a bit.
But for now……flat. to neg.
I’ve read that illegal immigration is flat to neg, but not legal immigration. It’s still going strong. Then again it’s only a matter of time before the Mexodus restarts.
And the waiting lists for green cards are still years long. By that I mean those who are sponsored by a relative. If they relaxed that there would be a deluge of new immigrants.
As of June last year the waiting list was 5 million long.
“Baby boomers are killing themselves at an alarming rate, raising question: Why?”
http://www.washingtonpost.com/local/baby-boomers-are-killing-themselves-at-an-alarming-rate-begging-question-why/2013/06/03/d98acc7a-c41f-11e2-8c3b-0b5e9247e8ca_story.html
Because getting laid off from a white collar job after age 50 is a financial death sentence for most people?
This is what “the future belongs to Lucky Ducky” means.
Layoffs, divorce, foreclosure, addiction, health problems, bankruptcy. After going through some or all of those, suicide is the solution.
The future = there is no future.
Re: yesterday’s discussion of the “broken social contract” being responsible for increased rates of suicide/unemployment today.
As early as the late 1960’s it was being pointed out that in the then “near future” the number of available jobs in America would be far exceeded by the number of people seeking one. I cannot recall the name of the professor, (Chomsky? Piaget? Does anyone here remember?) but he created quite a stir in the press by suggesting that it would be cheaper in the long run if We the People began paying our citizens a living wage NOT to have jobs until the demographic bulge caused by the Baby Boom was past. (Keep in mind that this was long before the “Trickle Down” deregulation of the 1980’s.)
He also suggested that instead of paying the $30K/year (1970’s dollars) we were then spending to keep non-violent offenders in prison, we simply give them half that amount to support themselves, with the proviso that they keep themselves out of jail with it.
In retrospect, I wonder if anyone today has run the numbers to see if he was right….
but he created quite a stir in the press by suggesting that it would be cheaper in the long run if We the People began paying our citizens a living wage NOT to have jobs
Isn’t that what SNAP and Section 8 are?
SNAP and Section 8 are not a living wage, and the majority of those of working age receiving benefits are employed.
“… In 1989, 42 percent of all SNAP households received cash welfare benefits and only 20 percent had earned income. By 2010, over three times as many SNAP households worked as relied solely on welfare benefits for their income….”
Consider also:
“…Most SNAP participants were children or elderly. Nearly half (47 percent) were under age 18 and another 8 percent were age 60 or older. Working-age women represented 28 percent of the caseload, while working-age men represented 17 percent. [USDA.gov, September 2011, ]…”
SNAP and Section 8 are not a living wage, and the majority of those of working age receiving benefits are employed.
Agreed, I was being snarky. But these programs exist because of the piss poor job market.
What’s this running numbers of which you speak? That would require some sort of “math”, wouldn’t it? As someone on here posted the other day, “Math is hard”.
Layoffs, divorce, foreclosure, addiction, health problems, bankruptcy
Dang but too often true. I’m think I’m going to the beach while my knees still don’t hurt (not so shoulder) and I’ll finish my work later.
Cheers mates!
It’s the economy, stupid. And ISTR reading that the American suicide rate went way up during the Great Depression.
Chemical dependency…the prescribed kind.
Dear Suicidal Baby Boomers,
If you are going to kill yourself anyway, why don’t you do us all a favor and take someone with you, (or at least try).
Here’s my working list:
1. Jamie Dimon
Feel free to add on.
Sincerely,
Wittbelle
It’s becoming clearer and clearer why they want to ban the guns.
Does a corporation count as people, my friends?
1. Monsanto
Feel free to add on…
One or both of the Koch Brothers
Living rent-free.
EU puts huge tariffs on Chinese solar panels.
China puts tariff on EU wine.
Let the trade wars begin.
Who wins the battle the country importing the most or the one exporting the most?
The ultimate winner will be the country with the most fresh water.
Runner up will be the country with the most fossil fuels.
Last country standing: Canada. Even global warming will help them.
That’s assuming the wars don’t scorch the people and earth to where it’s a moot point.
You mean exploiting natural resources helps a country? Bbbbbbbut what about the caribou and moose that might get in the way?
And lives in your skull rent-free.
Uh oh. It looks like a race to the top. AAAAAAAHhhhhhhhh!
“Get what you can get for your ever depreciating house now because it’s going to be much less later for many years to come.”
If you take on mortgage debt at current massively inflated housing prices, you’ll enslave yourself for the rest of your life.
“Debt is bondage.”~ Suze Orman, May 11, 2013
I figure dying is a lot like throwing-up. You put it off as long as you possibly can and then after you finally let it happen, you feel a lot better.
So would that make ingesting oil of ipecac analogous to suicide?
non-conformist
I hope us decent people feel
a lot better and the a-holes
and evil pos get their comeuppance.
From yesterday:
Comment by Whac-A-Bubble™
2013-06-04 17:51:25
For starters, [Case Shiller] is a repeat sales index — i.e. it averages changes in the prices of homes which sold more than once — and hence excludes new homes by definition.
My guess is that it also systematically excludes “distress sales” (e.g. short sales and REO) on the presumption these are “unrepresentative.” I’m fairly unconvinced that if these represent a significant portion of current market transactions, that they can be excluded without introducing serious bias.
This is a good question, whac-bear. But I can see two reasons to exclude distressed sales from the Shiller index:
1: Are short sales and foreclosures all open to public bidding? That’s a valid reason to exclude them. But then hopefully Shiller would label his charts as a prices-for-the-public index, while the connected boyz would be privy to some other index.
2: Deterioration factor. I’ve heard the figure to rehab a forecosure is $30K-$40K at least, just to be fit for human habitation. In DC, that’s a 10% price drop that’s NOT driven by market forces. In other locations, that $30K could be a 30% price drop. One should not include a condition driver in an index which is used as a metric for market forces.
whac-bear.
Huh huh…whack-a-bear-workshop.
oxide:
Yes, any home for sale is open for public bidding. A foreclosure is not any more likely to be a pocket listing than any other house. The deterioration factor is also not as much as you might think, since the banks often have the houses quicky rehabbed before selling them (but not always).
Among other things, the decision on whether house prices will rise, fall or flatten this year will be made this week.
The week ahead: Bilderberg 2013 comes to … the Grove hotel, Watford
Charlie Skelton
The Guardian, Sunday 2 June 2013 12.03 EDT
When you’re picking a spot to hold the world’s most powerful policy summit, there’s really only one place that will do: Watford. I guess the Seychelles must have been booked up.
On Thursday afternoon, a heady mix of politicians, bank bosses, billionaires, chief executives and European royalty will swoop up the elegant drive of the Grove hotel, north of Watford, to begin the annual Bilderberg conference.
It’s a remarkable spectacle – one of nature’s wonders – and the most exciting thing to happen to Watford since that roundabout on the A412 got traffic lights. The area round the hotel is in lockdown: locals are having to show their passports to get to their homes. It’s exciting too for the delegates. The CEO of Royal Dutch Shell will hop from his limo, delighted to be spending three solid days in policy talks with the head of HSBC, the president of Dow Chemical, his favourite European finance ministers and US intelligence chiefs. The conference is the highlight of every plutocrat’s year and has been since 1954. The only time Bilderberg skipped a year was 1976, after the group’s founding chairman, Prince Bernhard of the Netherlands, was caught taking bribes from Lockheed Martin.
It may seem odd, as our own lobbying scandal unfolds, amid calls for a statutory register of lobbyists, that a bunch of our senior politicians will be holed up for three days in luxurious privacy with the chairmen and CEOs of hedge funds, tech corporations and vast multinational holding companies, with zero press oversight. “It runs contrary to [George] Osborne’s public commitment in 2010 to ‘the most radical transparency agenda the country has ever seen’,” says Michael Meacher MP. Meacher describes the conference as “an anti-democratic cabal of the leaders of western market capitalism meeting in private to maintain their own power and influence outside the reach of public scrutiny”.
But, to be fair, is “public scrutiny” really necessary when our politicians are tucked safely away with so many responsible members of JP Morgan’s international advisory board? There’s always the group chief executive of BP on hand to make sure they do not get unduly lobbied. And if he is not in the room, keeping an eye out, then at least one of the chairmen of Novartis, Zurich Insurance, Fiat or Goldman Sachs International will be around.
http://www.guardian.co.uk/world/2013/jun/02/week-ahead-bilderberg-2013-watford - 162k -
The week ahead: Bilderberg 2013 comes to … the Grove hotel, Watford
Charlie Skelton
The Guardian, Sunday 2 June 2013 12.03 EDT
This year, there will be a great deal more “public scrutiny” of Bilderberg. Pressure from journalists and activists has won concessions from the venue: for the first time in 59 years there will be an unofficial press office, staffed by volunteers, on the grounds. Several thousand activists and bloggers are expected, along with photographers and journalists from around the world.
Back in 2009 there were barely a dozen witnesses – harassed and arrested by heavy-handed Greek police. This year there is a press zone, police liaison, portable toilets, a snack van, a speakers’ corner – all the ingredients for a different Bilderberg. A “festival feel” has been promised. If you are concerned about transparency or lobbying, Watford is the place to be next weekend. Whether the delegates reach out to the press and public remains to be seen. Don’t forget, they’ve got their hands full carrying out the good works of Bilderberg. The conference is, after all, run as a charity.
If you’ve been wondering who picks up the tab for this gigantic conference and security operation, the answer arrived last week, on a pdf file sent round by Anonymous. It showed that the Bilderberg conference is paid for, in the UK, by an officially registered charity: the Bilderberg Association (charity number 272706).
According to its Charity Commission accounts, the association meets the “considerable costs” of the conference when it is held in the UK, which include hospitality costs and the travel costs of some delegates. Presumably the charity is also covering the massive G4S security contract. Fortunately, the charity receives regular five-figure sums from two kindly supporters of its benevolent aims: Goldman Sachs and BP. The most recent documentary proof of this is from 2008 (pdf), since when the charity has omitted its donors’ names (pdf) from its accounts.
The charity’s goal is “public education”. And how does it go about educating the public? “In furtherance of these objectives the International Steering Committee organises conferences and meetings in the UK and elsewhere and disseminates the results thereof by preparing and publishing reports of such conferences and meetings and by other means.” Cleverly, it disseminates the results by resolutely keeping them away from the public and press.
The charity is overseen by its three trustees (pdf): Bilderberg steering committee member and serving minister Kenneth Clarke MP; Lord Kerr of Kinlochard; and Marcus Agius, the former chairman of Barclays who resigned over the Libor scandal.
When you’re picking a spot to hold the world’s most powerful policy summit
Can’t they just do Go To Meeting like us mere mortals?
It’s getting tough to rule the world.
Bilderberg 2012 Attendees Compilation - YouTube
http://www.youtube.com/watch?v=-PU1C3hJL5s - 168k - Cached - Similar pages
Jun 4, 2012 … Attendees coming and going from Bilderberg 2012, complete with … Henry Kissinger Arrives At Bilderberg 2012by
Welcome to Bilderberg, Scumbags! Greeting the … - YouTube
http://www.youtube.com/watch?v=jQA8q6LhABY - 228k - Cached - Similar pages
Jun 6, 2012 … The Bilderberger’s arrive for the 2012 meeting in Chantilly, VA. Mark Dice is a media analyst,
“We are grateful to the Washington Post, the New York Times, Time Magazine and other great publications whose directors have attended our meetings and respected their promises of discretion for almost 40 years……It would have been impossible for us to develop our plan for the world if we had been subjected to the lights of publicity during those years. But, the world is more sophisticated and prepared to march towards a world government. The supernational sovereignty of an intellectual elite and world bankers is surely preferable to the national autodetermination practiced in past centuries.”
― David Rockefeller
yikes!
On one hand the family practices
philanthropy (Drs w/o Borders for one)
and then I read that and my eyes pop out.
Oy.
Everyone has always hated the Rockefellers, but I’m sure that quote was made up.
In his book Memoirs, published in 2002, David Rockefeller, Sr. made the following remarks, startling in their very frankness: “For more than a century ideological extremists at either end of the political spectrum have seized upon well-publicized incidents such as my encounter with Castro to attack the Rockefeller family for the inordinate influence they claim we wield over American political and economic institutions. Some even believe we are part of a secret cabal working against the best interests of the United States, characterizing my family and me as ‘internationalists’ and of conspiring with others around the world to build a more integrated global political and economic structure — one world, if you will. If that’s the charge, I stand guilty, and I am proud of it.”
Esenbel: The Europeans should find ways to meet quick needs; for example, the Air Force needs spare parts. For other items that they can’t find in the stocks, maybe you could make a deal with the Dutch or others to send it here.
Macomber: That is illegal.
Kissinger: Before the Freedom of Information Act, I used to say at meetings, “The illegal we do immediately; the unconstitutional takes a little longer.” [laughter] But since the Freedom of Information Act, I’m afraid to say things like that.
http://wikileaks.org/plusd/cables/P860114-1573_MC_b.html - 97k -
Can’t they just do Go To Meeting like us mere mortals?
Even us office folks have to take a walk outside to talk about the really sensitive stuff.
Obama is only going because he wants to sucker punch that one guy from JP Morgan. It’s gonna be smacktastic!
Polly should like this one:
Why Didn’t the SEC Catch Madoff? It Might Have Been Policy Not To
http://www.rollingstone.com/politics/blogs/taibblog/why-didnt-the-sec-catch-madoff-it-might-have-been-policy-not-to-20130531
Very enlightening article, dj. Thanks for posting. All this is happening basically because of the goobermint, which doesn’t seem to believe in enforcing the law and actually degrades and punishes decent folks who try to do their job.
May these depraved fools receive medical and automotive care in the same manner of their own modus operandi. May they live in a hell far worse than what they have made for others.
Who would have ever dreamed that we would have to source the Rolling Stone for real news. Taibbi deserves a Pulitzer.
Taibbi deserves a Pulitzer.
If justice is ever done he’ll get a lot of awards.
It’s been that way for a long time. The Rolling Stone is one of the few real news sources around.
Crain’s is doing a good job here in Chicago of covering the speculation- at least in the new condo market. All inventory, new and existing, is at multi-year lows.
But the cheerleaders are out in full force. From Crain’s:
“We really did flip a switch at the beginning of the year,” said David Wolf, president of Related Realty, which has sold about 150 South Loop condos after relaunching three failed towers there this year.
The nascent condo recovery reminds Mr. Wolf of the years leading up to the market’s peak in 2006, when planned condo projects would sell out prior to construction amid rising prices and a speculative frenzy. Yet high-rise development has yet to return, with developers focusing on smaller, less risky low-rise projects.
Many observers expect developers to start converting apartments to condos next, though high-rise construction might not be so far off.
“Developers are starting to look around and look for locations again,” said Ms. Young of the Park Monroe sales office. “I see the market picking up.”
http://www.chicagorealestatedaily.com/article/20130604/CRED0701/130609967/condo-market-comeback-boosts-sales-at-tower-near-millennium-park
“Sabrina” huh?
Chicago…… base of NARscum………. and “Sabrina”
Sabrina….Is that a stripper name or a realtor name?
When ya can’t sucker someone into an inflated price for a depreciating house, you do the only other thing you know how….. take your clothes off.
Who says they’re two different people?
Thats a stripper name. Desiree is my realtor’s name. Desiree Lovesalot. Drives a BMW, wears a little too much makeup. Good kid, but has a terrible memory. She is always calling me, “Mark”.
“…..always calling me, Mark”
Hahahahaha now that’s funny.
“A new ranking of the 50 healthiest U.S. cities weighs “community indicators” that include everything from obesity rates and percentage of smokers to the number of baseball diamonds and tennis courts.
Despite its bone-chilling winters, Minneapolis-St. Paul topped the list for the third year in a row. High obesity and smoking rates placed Oklahoma City at the bottom.
More than 76 percent of Minneapolis-St. Paul residents reported exercising in the past 30 days.
Washington D.C., Portland, Oregon; San Francisco and Denver scored well in the fitness stakes, while Memphis, Tennessee; Louisville, Kentucky; San Antonio, Detroit and Oklahoma City were the least healthy.”
http://www.denverpost.com/lifestyles/ci_23379015/fittest-cities-take-exercise-publicly-and-personally
“More than 76 percent of Minneapolis-St. Paul residents reported exercising in the past 30 days.”
Talk about setting the bar low. 30 days? 100% should have exercised in the last 30 days, and 76% should have exercised in the last 3 days.
I live in one of the fittest cities on that list and there are certainly people here who NEVER exercise. They will take the elevator to go down one floor rather than navigate the stairs. The majority of their waking time is spent sitting, sitting at a desk at work, sitting in a car driving, sitting on the couch watching tv.
You dont see many obese people on NYC subways or even the buses, and i cant think of any time they had to cut out a window and use a crane to get some 700 lb whale out of a apartment because they live in a 6th floor walk up.
But then again they all maybe hidden due to a very good system of private handicapped transportation..access a ride
I think focusing on “exercise” is a dumb measure. Continous movement all day is the most preferable form of exercise.
Retail workers are on their feet most of the day, and I see some real porkers there.
Eating habits? Just because you move all day or “exercise” hard for 5 hrs a week doesn’t mean you can stuff anything you want.
In Colo
Just saying that being on your feet all day alone won’t cut it.
Just saying that being on your feet all day alone won’t cut it.
Everything being equal, science is coming out in favor of light movement all day vs hard training for an hour then prolong sitting.
From what I understand you should get your heart rate up a few times a week. Continuous movement doesn’t accomplish that, and many lifestlyes (ie jobs) don’t allow for it. But it raises the question, would construction workers who actually perform labour have responded that they didn’t exercise?
Interesting, notice that all the fitness crazed places are relatively well educated and attract young people? (Washington D.C., Portland, Oregon; San Francisco and Denver)
The two places I’ve lived as an adult (post school) tend to have very wide splits in fitness level. In NYC and also in Baltimore, the white people in nice neighborhoods are overwhelmingly thin/healthy looking. But if you venture out a little, you start to see other patterns. I drive through ghetto neighborhoods sometimes in Baltimore because you can avoid all the traffic near the waterfront… there is a fried chicken or “lake trout” place on every other corner, interspersed with places that sell “snowballs”. Where I work in DC is downtown and if you see someone fat they are usually a tourist from a flyover state, usually with a couple kids in tow, which is another way to tell the people aren’t DC area natives.
What’s interesting about metro Denver is that the transplants seem to exercise more than the natives. And the natives definitely don’t go the mountains as often, but maybe they’re just burnt out on dealing with I-70 traffic from all the transplants coming here.
BTW, was in Aspen last weekend and couldn’t find a $5,000 lot for RAL to build on, may have to up my budget to $6,000 or look a bit down the valley near Woody Creek or Snowmass.
If you find any $5k lots, let me know, I’m a good neighbor other than the harpsichord playing in the middle of the night.
I did find some lakefront lots here listed for $5,750, but the seller wouldn’t negotiate so I passed on the deal.
http://www.picpaste.com/IMG_20130601_140932_391-1gVLGrml.jpg
I think in the Rocky Mountains anywhere near the cities the natives feel depressed and outnumbered. Things are a lot different now than back when everything but Boulder was hard core farm/ranch/oil/gas/coal red state.
They should look at sales data for grocery stores. That will tell you more than ANY other metric.
[I was going to say look at the school lunches, but sadly, what they put on the lunch tray is not necessarily what the kids actually eat. Chef Jamie Oliver tried to reform the school lunch in West Virginia, only to watch kids throw his beautifully prepared vegetables into the trash and sneak junk food after school.]
Chef Jamie Oliver tried to reform the school lunch in West Virginia, only to watch kids throw his beautifully prepared vegetables into the trash and sneak junk food after school
It starts at home. If the parents feed them junk food, that is what they will learn to like.
+1. My nephew asks for broccoli, carrots, and other vegetables all the time as that’s what my sister gave him from day one. Not really into the junkie stuff.
“[I was going to say look at the school lunches, but sadly, what they put on the lunch tray is not necessarily what the kids actually eat. Chef Jamie Oliver tried to reform the school lunch in West Virginia, only to watch kids throw his beautifully prepared vegetables into the trash and sneak junk food after school.]”
I watched that show. The part I remember clearly is Jamie telling kids how chicken nuggets are made. Then showing them the ingredients, then mixing up the ingredients into a nasty sludge.
It was supposed to be an “EEEEWWWW I’m never eating that stuff again” moment for the kids. Funnily enough, he then asked who wants chicken nuggets? And all the kids’ hands went up enthusiastically. The look on poor Jamie’s face was priceless.
Weight maintenance is all about eating right not how many times you run on a treadmill a week. I can’t remember the last time I was in a gym, must be at least 10 years. Yet I weigh within 10% of what I weighed in high school when I was on several varsity teams. The secret is eat well. Well it’s not so much a secret as common sense, something the vast majority of this country lacks.
The secret is eat well. Well it’s not so much a secret as common sense, something the vast majority of this country lacks.
Plus the income required to buy healthy food. A bag of junk food is much cheaper than a bag of veggies. Fresh asparagus is $3/lb. It’s much cheaper to eat hot dogs, bologna with mac-n-cheese, and wash it down with some store brand soda pop.
In colorado, it would be an interesting study to run. Which is more expensive: eating well a la Paleo low carb, or eating junk?
I’d like to say the junk is cheaper, but that’s only if you track the real grocery store. What if you count all the furtive eat-on-the fly stuff like $1.49 bottle of Coke or the small potato chip bags, a $6 value menu, candy bars, and all the Red Bull you can slop down. it adds up.
Compare that to a well-planned Paleo diet of, ground beef, whole chickens, and frozen vegetables, bought in bulk and on sale. Round out with a little in-season fruit and cheap coffee or black tea. No, it’s not all organic and grass fed, but it’s still low-carb. And might be cheaper than junk from 7-11.
“All courses of action are risky, so prudence is not in avoiding danger, it’s impossible, but calculating risk and acting decisively. Make mistakes of ambition and not mistakes of sloth. Develop the strength to do bold things, not the strength to suffer.”
-Machiavelli
Hey Lib.
Did you miss me on the long weekend? Seems like I’m living rent-free in your skull these days. My how the times have changed.
You sound angry today Lib.
He’s been depressed about not getting in to the Lindsey Graham VIP room at Paddles last weekend.
Not Lindsay Graham-related but did anyone notice that John McCain’s son (from his 2nd marriage, to Cindy) married a black woman last weekend? Very interesting. She’s an awesome woman but it shocked me and I wonder what John *really* thinks about it.
You played at the wedding?! Get out!
Did you set up the candelabra too?
Is that a Liberace reference? Highbrow.
Yes Lib can be on the snobbish side.
I don’t remember “Housing Analyst” being a troll. Was his/her name highjacked?
Or fell off the wagon?
Wittbelle, Housing Analyist is Exeter, Housing Pimp, Realtors Are Liars, and other variations of those names. He’s always been a bit out-there, but about a year ago he lost it entirely.
Awww how cute…. a debt-jukie admiration society.
Or can’t afford meds? (They make a good generic that’s a fraction of the price of Lexapro…)
You’re so cute Witless…… and not very cunning.
Dude, John McCain’s son married a black lady? No way! He must have done it just to pisce daddy off.
” Seems like I’m living rent-free in your skull these days.”
If you could only imagine the things he does to you at night in his skull, you might rethink the whole “rent-free” part of living there.
“Cities were suburban poverty is skyrocketing”
http://homes.yahoo.com/news/cities-where-suburban-poverty-is-skyrocketing-213342422.html
Interesting. The census also showed that in Maryland all the poors are moving to the ‘burbs, the poverty rate in Baltimore County exploded in the last decade, while remaining flat in the city.
The poorest areas in the US are rural, though. Basically all the capable young people have left rural America and what’s left isn’t pretty. Drudge had a link to a story about this on his site but I’ll wait for 2Ban to post it, I don’t want to give Drudge any more business than he already gets from knuckle draggers
The poorest areas in the US are rural, though. Basically all the capable young people have left rural America and what’s left isn’t pretty.
I saw this when I was bicycling around the country during the 1980s and 1990s. It seemed as if the varsity team had moved to the cities, and the rural areas were left with the JV.
Hasn’t the upswing in suburban poverty been shown to have been caused by/correlated with the end of housing projects and the Section 8 program allowing poors to move wherever a landlord will take the voucher?
While the suburbs have no doubt become poorer (as has pretty much everyone else in the last 10 years), I’d think the influx of Section 8′ers has skewed the stats.
I wonder how many of the section 8′ers are newly minted.
I think it’s a mix of “left behind” whites who can’t find jobs in the modern economy plus inner-city section 8/projects refugees who can now afford to live in certain suburban areas because the bad fortunes of the afformentioned “left behind” whites has brought prices/rents down.
Also the suburban areas have realized that you can get more property tax money from a 10 acre development of more than a hundred 200k townhouses than you can from a 10 acre development with maybe 20 McMansions on it.
Good examples of this in Maryland are Middle River/Essex areas. You even see some of it in White Marsh now (BiLA’s former residence). White Marsh is quickly becoming a hell hole, anything within 2 miles of the mall is overdeveloped and the traffic is unbelievable. Miles-long backups at the rush hours are typical.
I think it’s a mix of “left behind” whites who can’t find jobs in the modern economy
Who hate “welfare queens” while using their SNAP cards at the grocery store.
The Drudge has been running pretty thick lately.
Poverty today is defined as only having an iphone 4G instead of the iphone 5. Nobody in America lives in poverty. You want poverty? Visit a slum in India. What we call poverty in America is luxury for most of the world.
Living in your skull rent-free.
Poverty today is defined as only having an iphone 4G instead of the iphone 5
You really need to get out more from your little cocoon. Go to a homeless shelter and see what poverty really is. Go to a Walmart parking lot at night and see how many people live in their clunky cars. I’m sure they all have iPhones.
Most of the poverty and homelessness in USA is not due to economics…not yet anyway. There’s still tremendous level of support available to people who want to help themselves. Chemical dependency…..that’s a b1tch!
The help is mostly for those who have kids. If you are childless you’ll get SNAP but that’s about it.
As for Section 8, most jurisdictions have LONG waiting lists, in some cases years long. And if you don’t have kids, you can pretty much forget about it.
Not everyone who is homeless is a drunk or a junkie.
As for food, they’re eating well, gaining weight even.
Daniel CanadaThere’s no such thing as a hungry homeless person.
Gregory DeloatchIn this city?
Daniel CanadaYou can’t be hungry.
Gregory DeloatchThat’s a joke.
Daniel CanadaToo many places to eat.
Gregory DeloatchAnyone that has a sign that says, I’m hungry and haven’t eaten in three days–
Daniel CanadaThat’s a joke.
Gregory Deloatch–is lying.
Daniel CanadaIt’s a scam.
Gregory DeloatchIt’s a scam.
Daniel CanadaThe city is littered with soup kitchens, littered. And the quality of the food is good. They have good quality food, fresh vegetables. Incredible. It’s the churches. Most of them are the churches. If it wasn’t for the churches, the homeless people would starve to death.
Gregory DeloatchFederal programs suck.
Daniel CanadaSuck. Even the quality of the food sucks at the federal program. And they give you so little bit of it. The churches, however, on the other hand, the people go out of their way to cook good food for you, serve you.
Gregory DeloatchThey want you there. They treat you differently.
Daniel CanadaThey perform music for you.
Gregory DeloatchBreakfast there is wonderful. It’s always something great.
Daniel CanadaCorn beef hash, beef stew.
Gregory DeloatchChicken, fish, salmon, fresh salmon, fresh whitefish. Oh man, lamb, steak, beef.
Daniel CanadaThey let you go around and get more.
Gregory DeloatchGo around as many times as you want. Knock yourself out.
Daniel CanadaThey give you a bag of food on the way out.
Lu OlkowskiAre you the person this food is meant for? You could have made a living, you’re competent.
Gregory DeloatchIs it meant for us? I mean, do all homeless people have to be disabled? Do all homeless people have to be crazy?
Daniel CanadaIt’s for the hungry. There are people who have jobs that eat there too.
Lu OlkowskiBut do you think people would want to be donating to you?
Gregory DeloatchWe’re donating to these guys’ experiment? Would they donate if they knew it was coming to us? No, no.
As for food, they’re eating well, gaining weight even.
Consuming a lot of HFCS empty calories isn’t “eating well”.
Most of the poverty and homelessness in USA is not due to economics
Yeah, half the workforce making less than $500 a week couldn’t possibly be a factor.
Clearly, half the population is on drugs, right?
in his eddietard mind, the lines at applebee’s stretch to infinity.
That’s not what Rush says, and Rush defines his reality… a reality where poor Smithers is oppressed by welfare queens and liberal pantywaists.
You forgot the Union Goons!
You forgot to mention the evil Koch Brothers and Faus Noise. Tsk tsk tsk.
Now back to the topic at hand….
Nobody in America lives in poverty. Section 8 is not poverty. Section 8 means indoor plumbing, electricity, working kitchens. That is not poverty.
Poverty is this.
http://www.google.com/imgres?imgurl=http://fotservis.typepad.com/photos/mother_india_calcutta_var/slums.jpg&imgrefurl=http://fotservis.typepad.com/photos/mother_india_calcutta_var/slums.html&h=319&w=500&sz=62&tbnid=iXz8TciE9xNLpM:&tbnh=90&tbnw=141&zoom=1&usg=__46lEF6rFSTSt1ayby0eXYRsnfWI=&docid=UABH5b8Xag_D_M&sa=X&ei=B4-vUc-GJ-iLjAKytIDIBg&ved=0CDMQ9QEwAA&dur=166
Your soundbite regurgitation isn’t insight, either. It must be awful to have your entire consciousness composed of cable news talking points.
There is still grinding intergenerational poverty in the US. As said, rural America has the highest rate. But in cities, if you go about a mile from the “best” areas, you can usually find grinding poverty. In Baltimore, just move up Broadway from Thames Street for about 1 mile, after you cross Lombard Street it’s all poverty to the north for the next mile or so. Then nice again for a while, etc.
America also has an incredible jailed population. #1 in the world, baby! Most of it because of a failed and useless “war on drugs”.
Slithers:
Have you ever been to Stockton or Compton? Then sush it.
Libby Slithers
Listing #13006170
$445,000 (LP)
Price/SqFt: 265.20
4703 Penrose Ave, Moorpark, CA 93021 Pending
Beds: 4* Baths: 2 (2 0 0 0) (FTHQ) Sq Ft: 1678* Lot Sz: 6098sqft*
Area: SMP Yr: 1984
What’s the neighborhood like? Are the streets paved with rare earths?
I’ve talked about this house before. It’s four blocks away, and I think that its owners thought that it would be a nice reno, followed by a quick flip.
It’s not working out that way. Place is just sitting there, with the “for sale” sign creaking in the Tucson summer winds.
Well, look at me. I’m a day late and a dollar short. The above link, which shows the house in its very run down, pre-renovation state, includes this bit of news:
06/04/2013
Listing removed
$199,999
$151/square foot
Listing agency: Tierra Antigua Realty, which is one of Tucson’s biggest
Personally, I think that the people who bought this place to fix -n- flip paid too much. I mean, come on. Look at this:
Sold on 11/1/12: $60,100
I would have been hard-pressed to pay very far into the five figures for this dump, but that’s just me.
I’m not sure I’m following you. So they flippers paid 60k and were able to sell for 199k? Or am I missing something?
I think that reno looks nice but you’ve said it’s close to UofA and the neighborhood isn’t the greatest.
These flippers paid $60k for a real dump of a place that had been abandoned for, oh, about a decade. Place needed a lot of work. If I was faced with a similar purchase, I would have tried very hard to get the price down closer to $20k. Or lower.
And I don’t think they sold for $199k. Why not? Because Tierra Antigua would have added a “SOLD” rider to their sign. I never saw one. Nor did I see a “Sale Pending” rider.
Methinks these flippers are going to try renting the place. I’m seeing quite a bit of that around here. House doesn’t sell, so into the rental pool it goes.
Sometimes, there’s a “for rent” and a “for sale” sign out front. I call this the “We’ll take the money any way we can get it!” strategy.
I’m sure the prospect of getting booted out at any time makes it attractive to renters.
The house (built in 1948) would not be worth $200k if they tore it down and built a new one.
Given the plethora of helpful advice from the Marketwatch peops on how to survive a stock market crash, you’d think they anticipate one, at a minimum, or perhaps even intend to precipitate one.
June 5, 2013, 11:37 a.m. EDT
How to survive a stock market crash
Commentary: Be careful, not fearful, and know what you own and why
By Michael Sincere
MIAMI (MarketWatch) — Investors who are deeply afraid of a stock market crash suffer from a condition I call “crashitis.” Symptoms include anxiety, insomnia, anger, and negative thoughts about the market. People in this condition often move all their money to cash even in bull markets. In extreme cases, investors may avoid the market for a lifetime.
After getting burned in the market twice in the last 10 years, it’s not surprising that many investors are suspicious of this market. It’s been said this is the most hated bull market in history.
Unfortunately, the fear of a market crash — crashitis — is worse than a crash itself. In truth, and based on probabilities and history, there are usually warnings before a correction or crash.
The boy who cried ‘crash’
The worst part of being afraid is the lost financial opportunity. Listening to doomsayers who constantly cry “crash” hurts your portfolio. Just like Chicken Little who thought the sky was falling when an acorn hit her on the head, a market correction will bring forth a wave of new crash predictions.
If there is a correction, don’t be surprised if the market disappoints everyone. Consider: The market bounces back after a pullback or sharp correction. Those expecting a huge crash (so they can buy at lower prices) won’t get it. Those thinking the bull market will continue indefinitely will lose money.
…
This is an extremely moronic article. The author must have “moronitis”.
A broken rubber band has no snap.
June 4, 2013, 8:02 a.m. EDT
Why is this recovery unlike the others?
Commentary: Rubber-band theory falls short this time
By Irwin Kellner, MarketWatch
PORT WASHINGTON, N.Y. (MarketWatch) — The rubber-band theory did not work this time.
Usually, a deep recession is followed by a steep recovery. It’s like pulling on a rubber band: The more you pull, the more it snaps back.
Translated to the economy, a deep recession leaves in its wake a host of pent-up demands.
For example, the long bout of high unemployment that accompanies a deep recession means that consumers must forego a number of purchases, such as a new car, the latest smartphone, a more modern refrigerator, and so on. Once the economic climate improves, shoppers are off and running in order to make up for lost time.
The same can be said for business. When faced with a prolonged bout of weak earnings, the first thing companies do is cut expenses. Buying the latest computer or other technological innovation goes on the back burner until profits pick up.
On the other hand, a mild recession, either short in duration or shallow in depth, means that both employment and profits are only slightly dented. Thus, spending patterns don’t change all that much. Of course, you could argue, that’s what makes the recession mild in the first place.
Whatever the case, if you go by the past recession, the economy should be zooming ahead by now. After all, they don’t get much deeper or much longer than the 2007-09 downturn.
As a matter of fact you have to go back to the first leg downward of the Great Depression, the 1929-1933 plunge, to exceed the 18 months that the past recession spanned.
All that said, the current recovery is, alas, feeble. It is not living up to expectations because things are different this time.
…
Because the changes are structural, not cyclical.
There’s no way these reporter don’t understand this, right? Right?
Or do they just parrot what their sources in the finance industry feed them?
“It’s not a recovery” says UCLA Anderson Forecast
The country’s tepid growth in its gross domestic product isn’t creating enough good jobs to build a strong middle class, according to a UCLA report released Wednesday.
“Growth in GDP has been positive, but not exceptional,” UCLA economists wrote in their quarterly Anderson Forecast. “Jobs are growing, but not rapidly enough to create good jobs for all.”
The report, which analyzed long-term trends of past recoveries, found that the long-anticipated “Great Recovery” has not yet materialized.
The country’s education system isn’t adequately developing the workforce of the future, said the forecast director.
Future workers will need
to pull paid employment out of their rear ends with Joshua Tree branchescreative and analytical thinking skills for 21st century jobs, he said.Future workers will need to live in third-world countries, where they will labor for a bowl of rice a day, all to benefit the wealthy elite.
Even Buffalo’s Real Estate market is improving. Buffalo!!
“Higher prices, more new listings and less time to make a sale. That summed up the Buffalo Niagara housing sector in April. Median prices jumped 8.1 percent in the year-over-year period to $116,800 from $108,000.
The time frame a property remained for sale dropped 4.7 percent to 82 days from 86 days. The percent of the listed price received edged up 0.5 percent to 94.6 from 94.1 percent. The overall supply of available homes was down 18.8 percent to 4,581 from 5,645″
Now EddieTard Slithers….. you just can’t resist misrepresenting housing can you….
The truth?
Housing demand in Buffalo is down a whopping 44% YoY.
http://www.zillow.com/local-info/NY-Buffalo-home-value/r_17222/#metric=mt%3D30%26dt%3D1%26tp%3D5%26rt%3D8%26r%3D17222%252C270899%252C270840%252C275206%26el%3D0
Posted without a commentary.
Again Cramer asked himself whether the asset class had gotten too expensive.
In this case Cramer thinks the answer is a resounding no. “On average a home is worth less than it was in 2006. Therefore, I don’t think housing is overheating, nationwide,” Cramer said. “I believe the renaissance in housing remains an investable thesis for the long-term.”
Cramer said. “I believe the renaissance in housing remains an investable thesis for the long-term.”
he should change his name to “cosmo kramer”.
baghdad jim-bob Cramer
“I believe the renaissance in housing remains an investable thesis for the long-term.”
Crash must be really close.
Cramer said. “I believe the renaissance in housing remains an investable thesis for the long-term.”
-1 This isn’t strong Kool-Aid talking; think psychopath pronouncement.
Bangladesh and its lack of enforcement of building codes
CENTER CITY - June 5, 2013 (WPVI) — A building collapsed at the corner of 22nd and Market streets in Center City Philadelphia, trapping a number of a people under the rubble.
Race to the bottom.
damn philly union goons!
Walked right by that place when I was visiting PA over Xmas. The owner had a bit of an, ahem, reputation for his ownership of, cough-cough, risque businesses.
The Entire US Housing Market In One Chart
http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2013/06/Housing%20Market.jpg
I see some unexploited areas that could use their attention. There’s nearly 68 million homes with some sort of untapped equity. How annoying must THAT be?
Pity that poor equity. It’s yearning to breath free.
Oops. It’s yearning to BREATHE free.
So, uh… what if increased homeownership rates actually do lead to higher unemployment?
Dear stock market:
HURRY UP AND CRASH ALREADY!
They are blaming Japan for the slide. The irony is they never thanked Japan for the run up.
What goes up, it must come down.
Dow loses 200 points…
Next bubble to pop is right here “state and local government spending 25.3% of California’s GDP”
Specifically, Whitney says “central corridor” states Texas, Oklahoma, Indiana, Colorado, Utah, North Dakota and Montana are best positioned for fast economic growth and population migration.
What these states have in common are low taxes, pro-business policies, low population density (meaning lower housing costs, shorter commutes and better quality of life) as well as strong and stable balance sheets, especially relative to other states.
“Regardless of whether the fiscal prudence of central corridor states was the result of serendipity of good planning, the reality is these states don’t have the financial burdens now crushing the housing-boom states,” she writes.
As a result, these “central corridor” states are in a position to keep taxes low while also spending on infrastructure and education, all of which will make them more attractive to both U.S. and foreign corporations looking to relocate.
On the other hand, Whitney is very skeptical on prospects for states that overspent during the boom and now face huge budget shortfalls plus falling tax revenues after the housing bust.
‘Negative Feedback Loop from Hell’
“Illinois and New Jersey are the worst because they’ve been doing it the longest,” Whitney says, adding Michigan and California to her list of bad state actors. “They spent as if the good times would never end and made big promises to state and local government employees based on the deliberate bet that they wouldn’t.”
In 2009, for example, state and local government spending was 25.3% of California’s GDP and 25% in New York, which compares unfavorably to just 9.7% in Texas.
And now, these states are being sucked into what Whitney calls “the negative feedback loop from hell.”
Faced with massive deficits and huge pension fund liabilities, these states need to raise taxes even as they’re “running out of money needed to pay for libraries, safe streets, clean drinking water and, yes, schools,” she laments.
Faced with declining services, high taxes and sluggish growth, Whitney predicts the “smart money” – businesses and wealthy individuals alike – will begin relocating from the coasts (and Illinois) to the central corridor.
“One thing really threatening certain states is the power of the 1%…[this group] is being tempted into more tax favorable, more biz friendly states…with higher social services and better infrastructure,” she says.
To be clear, Whitney’s point is the central corridor states have an opportunity to continue to grow faster than the rest and enjoy long-term demographic shifts similar to the 1970s, ’80s and ’90s when Americans fled the ‘Rust Belt’ for the ‘Sun Belt’.
But success is not guaranteed. These states must execute on the strategy; Texas, for example, faces a major challenge of high school dropouts and must continue to spend on and improve its education system in order to remain an attractive destination for businesses, she says.”
I wonder how Nevada compares ?
Specifically, Whitney says “central corridor” states Texas, Oklahoma, Indiana, Colorado, Utah, North Dakota and Montana are best positioned for fast economic growth and population migration.
What these states have in common are low taxes, pro-business policies, low population density (meaning lower housing costs, shorter commutes and better quality of life) as well as strong and stable balance sheets, especially relative to other states.
FWIW Colorado housing costs aren’t all that low. Low population density? Maybe out in the plains, where no one wants to live. Plus we have a Dem controlled gov’t. And our right wingers love to scream that taxes are too high and that the state isn’t business friendly.
” Plus we have a Dem controlled gov’t. And our right wingers love to scream that taxes are too high and that the state isn’t business friendly.”
And for good reason too.
What do 8 of the top 10 states have? A Republican governor
What do 8 of the top 10 states have? No state income tax.
What do 8/10 of the BOTTOM states have? A Democrat governor
What do 10/10 BOTTOM states have? A ridiculously high state income tax.
But yeah, the road to prosperity is elect more Democrats and raise taxes. You can’t lose Colorado!!
http://www.forbes.com/sites/mikepatton/2013/03/31/the-most-and-least-business-friendly-states/
But success is not guaranteed. These states must execute on the strategy; Texas, for example, faces a major challenge of high school dropouts and must continue to spend on and improve its education system in order to remain an attractive destination for businesses, she says.
Wouldn’t that cut into the football budget?
Hmmm. I wonder what % of those high school dropouts are either illegals or children of illegals? Ooops. Did I ask an uncomfortable question?
“The survey also assessed the small business climates of 57 metropolitan areas. The Austin, Texas, area topped the overall rankings, earning high marks for ease of starting a small business, training and networking programs. Four of the top 10 areas netting the highest scores were from the Lone Star state.”
http://www.governing.com/blogs/by-the-numbers/small-business-friendly-states-cities-rankings.html
That’s odd. I was told by my liberal betters on HBB that Texas is nothing but toothless rednecks with guns. I guess they’re redneck toothless rednecks who know how to start businesses too.
As in the Forbes ranking, 9 of the top 10 had Republican governors
Utah
Alabama
New Hampshire
Idaho
Texas
Virginia
Kansas
Colorado
South Carolina
Georgia
It’s so weird how CA, NJ, NY, DE, OR and all the other liberal meccas fail to make any of these lists.
It’s been an interesting day here on the HBB. Given enough rope, the attorneys and PR hacks posting here hang themselves right out in public.
Frankly I wouldn’t pay them to wash my car but that’s just me.
Ultra-lib Democrat NY Governor, and front runner for 2016 is looking for ways to spur growth in upstate NY.
“By tax-free, I mean really, really tax-free,” Mr Cuomo said last week as he toured the state to promote the plan. The plan comprises 120m square feet of space on and around dozens of State University of New York campuses and a number of private colleges, all outside Manhattan.
It is Mr Cuomo’s latest attempt to jump-start the sluggish upstate economy by encouraging growth in the tech sector and changing New York’s reputation as a high-tax environment. “If you just reduced the loss of jobs, that would be a home run. We create start-up businesses. Right now we just can’t keep them,” Mr Cuomo told the Financial Times. “They get their legs under them, so to speak, then they leave for a lower-tax environment.”
WAIT WHAT? Low/No taxes leads to economic growth? This is crazy talk and obviously Mr. Cuomo is nothing but an evil Koch Brothers backed right wing lunatic who hates children and wants to kill grandmothers. My liberal betters here at HBB have assured me that only higher taxes and more regulation leads to economic growth.
You are making Rio weep. Polly too.
Paging Az Slim
Need a one unit small chain and lock to
secure solar lantern to my shepherd hood
w/ bird top. (holes in bird footing to wrap thru)
Got any bike lock ideas?
Would this info be helpful? (I’ve heard good things about the St. Pierre chains mentioned in the linked article.)
So when QE stops the artificial support for stocks goes away. Stocks will revert to the mean. What will investors put their money into next?
Not houses.
Cash?
Gold?
Raising interest rates if unemployment drops by 1 tenth of a percent is foolish while wages stay depressed. Raising interest rates in response to a speculator-driven housing boomlet (a false bubble) is foolish. They are taking the medicine against the Bernanke deflation away, seems we will get deflation, then they will apply inflationist policies big time - hyper inflation.
Gold, silver, and platinum.
“So when QE stops the artificial support for
stocksgold goes away.”Riiiiiiiiight.
As you witness global stock markets crash and burn yet again, console yourself with a reassuring thought:
THE STOCK MARKET ALWAYS GOES UP.
June 5, 2013, 11:27 p.m. EDT
Asian stocks fall; Japan slips toward bear market
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By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) — Asian markets fell Thursday after a big drop on Wall Street in the wake of a weak U.S. private-sector jobs report, raising concerns about Friday’s crucial nonfarm payrolls data.
Japanese equities were tormented by more volatility that also affected the yen and bond yields, dragging stocks closer toward a so-called bear market.
Japan’s Nikkei Stock Average (JP:NIK -0.85%) shook off a weak opening to rebound earlier Thursday, but then retreated again to drop 0.5% by the midday break. The broader (Topix JP:I0000 -1.37%) fell 1%.
Both benchmarks had dropped more than 3% in the previous session, after Prime Minister Shinzo Abe’s blueprint for the nation’s long-term economic recovery fell short of some expectations.
The Nikkei Average, in particular, is off nearly 19% from the 52-week high it reached on May 23. A drop of 20% from that high would take the 225-stock benchmark into a technical bear market. The Topix is off more than 16% from its own 52-week high.
…
Always goes up if you 1) invest X at year Y into a broad stock index fund, get into a coma, wake up 24 years later, discover your investments are up, 2) get into a coma (again) , wake up 24 years later, discover your investments are up…and so on
props to Jeremy Siegel