June 9, 2013

Bits Bucket for June 9, 2013

Post off-topic ideas, links, and Craigslist finds here.

RSS feed


Comment by Ol'Bubba
2013-06-09 04:15:37

It’s time to make the coffee…

Comment by Resistor
2013-06-09 05:15:06

We’re off to the local diner for some cheap, short-order eats.

Comment by non-conformist
2013-06-09 05:25:41

“We’re off to the local diner for some cheap, short-order eats.”

My Cousin Vinny - YouTube
http://www.youtube.com/watch?v=uYoYPJ5uwFg - 184k - Cached - Similar pages
Aug 6, 2007 … Clip from My Cousin Vinny. …”Excuse me- you guys hear about the ongoing cholestrol problem in the country?”

Comment by snowgirl
2013-06-09 05:30:40

So much comfort in that one brief statement. Have a nice day Ol’Bubba.

Comment by Ol'Bubba
2013-06-09 06:27:41

Thank you. Back at ya.

Comment by Bill in Los Angeles
2013-06-09 10:07:59

Instant coffee day. Via.

Working on the other type of java this weekend (programming language).

Comment by non-conformist
2013-06-09 04:32:30

Comment by Housing Analyst
2013-06-08 17:18:58
“Best Explanation on the Fake Housing Market Recovery I’ve Seen”


From “Best Explanation on the Fake Housing Market Recovery I’ve Seen”

“Major financial institutions like The Blackstone Group L.P. (NYSE/BX) have become major buyers in the U.S. housing market. Blackstone has spent more than $4.0 billion for 24,000 homes in the U.S. housing market that it plans to rent out.”

Blackstone also ventured into other businesses, most notably investment management. In 1987 Blackstone entered into a 50–50 partnership with the founders of BlackRock, Larry Fink and Ralph Schlosstein. The two founders, who had previously run the mortgage-backed securities divisions at First Boston and Lehman Brothers Kuhn Loeb, respectively, initially joined Blackstone to manage an investment fund and provide advice to financial institutions. They also planned to use a Blackstone fund to invest in financial institutions and help build an asset management business specializing in fixed income investments.[3][38]

http://en.wikipedia.org/wiki/Blackstone_Group - 199k -
BlackRock was founded as BlackStone Financial Management within the private equity firm Blackstone Group in 1988. Larry Fink, BlackRock’s founder and CEO, had joined Blackstone in 1988 as a partner, along with Ralph Schlosstein, former White House aide under the Carter administration, and Robert Kapito and Sue Wagner. Before joining Blackstone, Fink was a managing director at First Boston, where he pioneered the mortgage-backed securities market in the United States. In 1992 Fink, Schlosstein and Co separated from the Blackstone Group under the name BlackRock and aggressively re-invented it as an independent asset-management company. In 1995, PNC Financial Services Group purchased BlackRock and in 1999, assets under management had grown to $165 billion and the firm decided to go public.1

Role in 2008-2009 Bailout, Management of Maiden Lane Portfolios
BlackRock Financial Management Inc. was retained by the New York Fed to manage and eventually liquidate the assets held in newly formed Delaware limited liability companys (LLC) to fund the purchase of residential mortgage-backed securities (RMBS) from the securities lending portfolio of several regulated U.S. insurance subsidiaries of AIG, as well as Bear Stearns. These companies were formed in late 2008 under the names Maiden Lane LLC (which was incorporated with the purpose of facilitating “the merger of the Bear Stearns Companies, Inc. and JPMorgan Chase & Co.”), Maiden Lane II LLC and Maiden Lane III LLC (which were formed to fund the purchase of certain multi-sector collateralized debt obligations (CDOs) from certain counterparties of AIG Financial Products Corporation). In early 2009, the collective worth of these companies was more than $200 billion. According to Bloomberg, as of July 2009, BlackRock received at least $71 million in the first year of contracts to oversee assets previously owned by Bear Stearns Cos. and American International Group Inc. BlackRock is received $45.3 million that year for running the Maiden Lane holdings that the Federal Reserve took over from Bear Stearns, based on contract terms released by the New York Fed. The company earned another $25.5 million to manage the Maiden Lane II and Maiden Lane III investments that the Fed purchased from AIG.4

In the initial stages of the U.S. government’s bailout of the financial system, Maiden Lane III paid large sums of money to a number of other European banks, including some U.S. institutions already receiving money from the government. Though these transactions were ostensibly designed to pay debts on credit default swaps held by AIG Financial Products, Maiden Lane III ultimately served as a conduit to funnel large sums of taxpayer money to pay off private debts owed to foreign corporations. These “counterparties” to so-called “toxic assets” held by AIG were paid more than $27.1 billion through Maiden Lane III, including Deutsche Bank, Landesbank Baden-Wuerttemberg, Deutsche Zentral-Genossenschaftsbank, Dresdner Bank AG, Goldman Sachs, Société Générale, The Royal Bank of Scotland, Barclays, the Bank of Montreal, Rabobank, Calyon, Wachovia, and UBS, among others. These payments occurred from September 16-December 31, 2009.

http://publicintelligence.net/blackrock-inc/ - 104k

Comment by Housing Analyst
2013-06-09 05:06:52

June 7, 2013: “Best Explanation on the Fake Housing Market Recovery I’ve Seen”


First the HBB, then Mark Hanson, then Ritholtz…… now it’s gone mainstream.

Comment by alpha-sloth
2013-06-09 13:26:08

If first-time home buyers aren’t participating, and the rise in home prices is because of institutional investors buying- as the article says- well, isn’t that a Good Thing? Wasn’t there just a study that showed more people buying houses was bad for the economy? Sounds like we’re having fewer buyers and more renters. Happy days are here again!

Comment by Housing Analyst
2013-06-09 17:45:07

Inflated prices are a good thing?

What kind of LIEberal are you Alwog?

Comment by jose canusi
2013-06-09 05:35:06

You mean to tell me the Santa Monica shooter wasn’t some crazed white supremacist Tea Party member? No? I’m SHOCKED, I tell you, SHOCKED. No wonder it took the MSM so long to reveal the identity (when the police already knew it). They must have been having a serious case of flop sweat and huffing the smelling salts.

Tsk-tsk. Please, no BACKLASH, now. We musn’t have BACKLASH. Oh, no, BACKLASH just won’t do.

Comment by non-conformist
2013-06-09 06:11:44

Santa Monica shooter? Stay away from the drills!

LAPD to conduct counterterrorism drill in conjunction with homeland …
http://www.foxnews.com/us/2013/06/06/lapd-to-conduct-counterterrorism-drill-in-conjunction-with-homeland-security/ - 57k - Cached - Similar pages
2 days ago … Authorities say the drill is part of the National Homeland Security … 5 dead, including gunman, in shooting rampage near Santa Monica College …
Massive Police Drill in Los Angeles Alex Jones’ Infowars: There’s a …
http://www.infowars.com/massive-police-drill-in-los-angeles/ - 81k - Cached - Similar pages
1 day ago … The drill involved LAPD officers repelling from police helicopters onto city streets, … I had heard about the Santa Monica shooting yesterday, and thought to … for the attendees of the homeland security conference at that hotel.

Comment by jose canusi
2013-06-09 06:34:59

Jeebus, man, they’re talking about live demos here.

Comment by donzerly lite
2013-06-09 10:36:25

Point of order:

While the police may have also been “repelling” from their helos, most likely they were “rappelling” into the crowds.

Comment by alpha-sloth
2013-06-09 13:28:35

Here, here!

(Comments wont nest below this level)
Comment by Ol'Bubba
2013-06-09 06:28:41

is that you, Palmetto?

Comment by jose canusi
2013-06-09 06:32:22

Yes, of course it’s me, Palmetto. I’ll be back to my regularly scheduled moniker if and when the shamnasty surge fails.

Comment by jose canusi
2013-06-09 06:40:26

In the meantime, think about this:

“importing workers to pit against the native populace”

THAT, my friends, is why the shamnasty.

(Comments wont nest below this level)
Comment by nickpapageorgio
2013-06-09 12:14:33

Crushed…right out of the park!

Comment by azdude
2013-06-09 05:48:07

buy a house today and let the cash start rolling in tomorrow?

Comment by Housing Analyst
2013-06-09 05:51:13

Dump it today while you still can.

Comment by azdude
2013-06-09 06:07:11

leverage it first then dump it. Get a new chevy and save the economy.

Comment by jose canusi
2013-06-09 05:56:08

The revolution will not be televised…

“Modern governments are good at pacifying their citizens. The present system uses plenty of old-fashioned Soviet-style repression, jailing large fractions of the populace pour encourager les autres, depriving thought criminals of their livelihood, and overtly controlling the sparse mass media that remains. They also use the old British imperial techniques of pacifying restive populations with pornography, social atomization, importing workers to pit against the native populace, psychoactive drugs, and cheap entertainment. While the people are obviously not content, they are pacified, and for the system to continue on its present trajectory, that is enough. The Ottoman Empire wasn’t terribly popular, either, and it lasted 400 years.”


Comment by non-conformist
2013-06-09 07:01:26

I think Boston was my favorite drill so far. Ooops I forgot…

Obama: If you can’t trust us, we’re going to have some problems http://www.youtube.com/watch?v=Ibc6QSV5ftw - -

“A revolution against the government is the sheerest fantasy, no matter how well-armed the citizenry is. Since the most trusted institution in America at present is the military, if nuts such as Kokesh, OWS, or the glory-hole patrol began causing real problems, the most likely outcome will be martial law such as we recently saw in Boston.”

Comment by In Colorado
2013-06-09 08:40:13

the most likely outcome will be martial law such as we recently saw in Boston

While “patriots” chant “USA, USA!”

Comment by non-conformist
2013-06-09 09:35:38

“While “patriots” chant “USA, USA!”?

The martial law election map looks blue to me. I think those “Betters” like martial law.

President - 2012 Massachusetts Election Results - Boston.com
http://www.boston.com/news/special/politics/2012/general/mass-us-president-election-results-2012.html - 82k -

(Comments wont nest below this level)
Comment by ahansen
2013-06-09 11:10:31

“I think Boston was my favorite drill so far. Ooops I forgot…”

With all due respect, NE, I think the Boston Police Department and DSH probably did a better job of preventing additional carnage in that scenario than your citizen Go-timers would have. Please recall the “stay-indoors” order was a recommendation, not a mandate, and people seemed pretty eager to comply on their own. I certainly would have!

How would YOU propose we handle the next attack of this nature? More to the point, how do you propose we try to prevent it from happening on a larger scale?

Seriously asking here.

Comment by non-conformist
2013-06-09 12:03:05

“how do you propose we try to prevent it from happening on a larger scale?”

A larger smoke bomb?

Boston Marathon Bombing …
http://educate-yourself.org/cn/bostonbombingdidyouthink20apr13.shtml - 83k -

http://www.youtube.com/watch?v=qNsnCVuE2C4 - 211k -

CAUGHT! CNN’c CIA Crisis Actor At Boston Marathon _ Suspect …
http://www.youtube.com/watch?v=ibJvX-pnHrA - 149k

(Comments wont nest below this level)
Comment by alpha-sloth
2013-06-09 14:25:49

Those are actors, allena. The whole Boston bombing thing was fake, like the moon landings, and World War 2.

Comment by ahansen
2013-06-09 15:20:23

You’re telling me that, that GOT…is all…(gulp) PRETEND?!!!


Comment by non-conformist
2013-06-09 15:35:01

http://educate-yourself.org/cn/bostonbombingdidyouthink20apr13.shtml - 83k -

In this one I really like the black girl with the red shirt who sits in front of the amputee while with no blood on her and then ends up on a stretcher covered in blood while they leave the poor legless dude on the ground waiting for the cowboy to get him a wheel chair?

Comment by non-conformist
2013-06-09 17:12:39


Washington Post? They’re just like CNN who got busted using the same actor as a witness at the “bombing and the shooting.

CAUGHT! CNN’c CIA Crisis Actor At Boston Marathon _ Suspect …
http://www.youtube.com/watch?v=ibJvX-pnHrA - 149k

Comment by non-conformist
2013-06-09 17:19:18

“Those are actors, allena. The whole Boston bombing thing was fake, like the moon landings, and World War 2.”

World War 2 and the moon landings didn’t take place during the Odrama administration.

And quite honestly for what we are paying for these False Flags I would think we could get better actors. I mean at least they could find some actors that could cry real tears.

Comment by alpha-sloth
2013-06-09 17:56:55

World War 2 and the moon landings didn’t take place during the Odrama administration.

Or so they would have you believe.

Comment by non-conformist
2013-06-09 18:37:45

“Or so they would have you believe.”

Better watch that alpha cause If you can’t trust them, we’re going to have some problems.

Obama: If you can’t trust us, we’re going to have some problems …
http://www.youtube.com/watch?v=Ibc6QSV5ftw - - Cached - Similar pages

Comment by ahansen
2013-06-09 23:47:38

You know what? I already posted a link to the guy who got his legs blown off telling everyone that your website is utter bs, along with affidavits from the hospital staff who treated him. Look it up for yourself and stop being a dick. It detracts completely from the good commentary you DO make.

Shock does amazing things to the human body. It’s how some people survive the unsurvivable.

Comment by Prime_Is_Contained
2013-06-11 22:59:35

Shock does amazing things to the human body. It’s how some people survive the unsurvivable.

+1, Allena. The fact that the body restricts blood flow to traumatized areas is an amazing survival trait.

For a barely-injured person, it may be inconvenient (light-headed or passing out); for a seriously-injured person, it can be life-saving.

Comment by rms
2013-06-09 08:01:39

+1 But where is my loaf of bread and the circus?

Comment by Bluestar
2013-06-09 12:43:25

“We” are the circus. The emperor, lords and royalty are the audience.

Comment by jose canusi
2013-06-09 14:11:05

Today’s “loaf of bread” is food stamps.

Today’s circuses are Facebook, Twitter and other social media, American Idol, The Voice, America’s got Talent, Big Sports, etc.

Comment by alpha-sloth
2013-06-09 14:29:18

Speaking of The Voice, is Usher not a very good coach, or what?

(Comments wont nest below this level)
Comment by Ben Jones
2013-06-09 20:33:44

‘ Go peddle that tripe to this guy’

Speaking of peddling tripe”

‘Dear Senator Feinstein:

On Thursday, when you responded to news about massive ongoing surveillance of phone records of people in the United States, you slipped past the meaning of the Fourth Amendment. As the chair of the Senate Intelligence Committee, you seem to be in the habit of treating the Bill of Rights as merely advisory.

The Constitution doesn’t get any better than this: “The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.”

The greatness of the Fourth Amendment explains why so many Americans took it to heart in civics class and why so many of us treasure it today. But, along with other high-ranking members of Congress and the president of the United States, you have continued to chip away at this sacred bedrock of civil liberties.

As The Guardian reported the night before your sudden news conference, the leaked secret court order “shows for the first time that under the Obama administration the communication records of millions of U.S. citizens are being collected indiscriminately and in bulk — regardless of whether they are suspected of any wrongdoing.”

One of the most chilling parts of that just-revealed Surveillance Court order can be found at the bottom of the first page, where it says “Declassify on: 12 April 2038.”

Apparently you thought — or at least hoped — that we, the people of the United States, wouldn’t find out for 25 years. And the fact that we learned about this extreme violation of our rights in 2013 instead of 2038 seems to bother you a lot.

Rather than call for protection of the Fourth Amendment, you want authorities to catch and punish whoever leaked this secret order. You seem to fear that people can actually discover what their own government is doing to them with vast surveillance.

Meanwhile, the executive branch is being run by kindred spirits, as hostile to the First Amendment as to the Fourth. On Thursday night, Director of National Intelligence James Clapper issued a statement saying the “unauthorized disclosure of a top secret U.S. court document threatens potentially long-lasting and irreversible harm to our ability to identify and respond to the many threats facing our nation.”

That statement from Clapper is utter and complete hogwash. Whoever leaked the four-page Surveillance Court document to Glenn Greenwald at The Guardian deserves a medal and an honorary parade down Pennsylvania Avenue in the Nation’s capital. The only “threats” assisted by disclosure of that document are the possibilities of meaningful public discourse and informed consent of the governed.

Let’s be candid about the most clear and present danger to our country’s democratic values. The poisonous danger is spewing from arrogance of power in the highest places. The antidotes depend on transparency of sunlight that only whistleblowers, a free press, and an engaged citizenry can bring.

As Greenwald tweeted after your news conference: “The reason there are leakers is precisely because the government is filled with people like Dianne Feinstein who do horrendous things in secret.” And, he pointed out, “The real story isn’t just the spying itself: it’s that we have this massive, ubiquitous Surveillance State, operating in total secrecy.”

Obviously, you like it that way, and so do most other members of the Senate and House. And so does the president. You’re all playing abhorrent roles, maintaining a destructive siege of precious civil liberties. While building a surveillance state, you are patting citizens on the head and telling them not to worry.

Perhaps you should have a conversation with Al Gore and ask about his statement: “Is it just me, or is secret blanket surveillance obscenely outrageous?” Actually, many millions of Americans understand that the blanket surveillance is obscenely outrageous.

As a constituent, I would like to offer an invitation. A short drive from your mansion overlooking San Francisco Bay, hundreds of us will be meeting June 11 at a public forum on “Disappearing Civil Liberties in the United States.” (You’d be welcome to my time on the panel.) One of the speakers, Pentagon Papers whistleblower Daniel Ellsberg, could explain to you how the assaults on civil liberties and the wars you keep supporting go hand in hand, undermining the Constitution and causing untold misery.

Senator Feinstein, your energetic contempt for the Bill of Rights is serving a bipartisan power structure that threatens to crush our democratic possibilities.

A huge number of people in California and around the country will oppose your efforts for the surveillance state at every turn.


Norman Solomon’


I’m thinking we’ve got some menudo sellers on this blog.

Comment by Wit belle
2013-06-09 23:29:22

Ellsberg’s showing up? Man what a thrill. I would love to hear his thoughts.

Comment by ahansen
2013-06-10 00:18:42

Oh please. You’re accusing ME of supporting this nonsense?

Feinstein is a scary old broad who thinks that keeping the country safe from crazy people means she and her committee get to subvert the Constitution, but I find it curious that suddenly everyone is so up in arms about something which up until the last week, they supported wholeheartedly. (I’m looking at YOU, everyone who wasn’t screaming bloody murder when they passed the PATRIOT act.)

Anyone who reads knows that communications have been sieved since the advent of the internet, and most of us have always known that the government can (and does) monitor whatever it wants for whatever reason it wants whenever it wants to — and deal with it accordingly.

Bradley Manning rots in jail, but all the sheeple can think about is someone finding out what they might have said about that guy that time when…well, you know. But at least it’s a start.

Comment by jose canusi
2013-06-09 06:14:41

Ah-HAH! The long knives are out.


Yep, there comes a point, no matter how “liberal” you want to be, that you just have to say when someone sucks at their job. Holder has been given so much rope it looks like he’s finally hanging himself.

You know it’s bad when the main MSM lapdog for the administration starts calling for the AG to move on.

Comment by In Colorado
2013-06-09 06:59:56

Lots of liberals are fed up:


Comment by Whac-A-Bubble™
2013-06-09 07:10:19

Is there really more surveillance going on in the Obama administration than in previous ones, or just more awareness thereof, aided and abetted by political enemies?

I only raise this issue because of the long, gradual paradigm shift I have undergone in my life about Richard Millhouse Nixon. When I was young and naive, I bought into all the MSM hype about how he was a criminal worthy of impeachment. Now that I am older and wiser, I fully appreciate my inability to discern whether the allegedly heinous acts on his watch truly represented something new and different he personally instituted, or were simply business as usual for the WH.

Comment by scdave
2013-06-09 07:21:51

Your privacy went out the technological door long ago and just continues to get worse…It really does not matter if the government is doing it..Someone in the private sector can & will…Don’t we have some billionaire & millionaire vigilante’s in our midst ?? Bet we do…Likely lots of them…

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2013-06-09 07:31:08

I believe it is illegal for the private sector to do it, unless you willingly give them access to your personal information, e.g. by posting on Facebook or using Google or Yahoo.


Comment by Whac-A-Bubble™
2013-06-09 08:28:44

“Don’t we have some billionaire & millionaire vigilante’s in our midst ?? Bet we do…Likely lots of them…”

Until the First Amendment to the U.S. Constitution is rescinded, they can go f- themselves.

Comment by scdave
2013-06-09 08:40:05

they can go f- themselves ??

They don’t get f- until they get caught and prosecuted…In the mean time ??

Comment by ahansen
2013-06-09 11:00:30

Nixon’s sins weren’t so much of surveillance (although there was much of that) so much as his domestic spying was done EXTRA-ILLEGALLY and for PERSONAL VENDETTA, and not within the context of established law. Nixon then, in cahoots with FBI Director Jedgar Hoover, (whose personal power was Cheney-esque in scope and and RoyCohnly corrupt) PERSONALLY presided over a massive and multi-year coverup, and a smear campaign that made Fox news commentators look like pikers.

Americans were literally shot on our streets by the National Guard under Nixon’s orders, thrown into prison SOLEY for their political views, and dragged off campuses at gunpoint to go off and blow up peasants in pajamas on behalf of Dow Chemical and Union Carbide.

The Nixon administration’s heavy-handed enforcement of his agenda nearly brought our country to civil war — not “go-time” civil war, ACTUAL civil war.

I lived through all that as a young, politically astute adult and believe me, this administration can’t hold a candle to Nixon’s excesses.

Comment by aNYCdj
2013-06-09 11:59:08

I have been really getting into Abby Martin from Russian TV:


Comment by Mr. Smithers
2013-06-09 12:12:20

“Americans were literally shot on our streets by the National Guard under Nixon’s orders, thrown into prison SOLEY for their political views, and dragged off campuses at gunpoint to go off and blow up peasants in pajamas on behalf of Dow Chemical and Union Carbide. ”

1. Dragged off campus? Interesting this was happening since going to college meant you didn’t get drafted.


2. Nixon started this? Nobody was forced to go to Vietnam pre Jan 20, 1969 when Nixon took office?

“I lived through all that as a young, politically astute adult and believe me, this administration can’t hold a candle to Nixon’s excesses”

IRS targeting of political opponents. Using the NSA to record every phone call. Yeah you’re right. That’s nothing compared to breaking into DNC headquarters. What will it take for Obama lackeys to admit he’s done wrong? Eat a puppy on live TV? Even then he’d be defended as doing his part to control the dog population by his acolytes.

Comment by Hi-Z
2013-06-09 12:33:48

I lived through the same era. You obviously viewed it from the left side of the street.

Comment by nickpapageorgio
2013-06-09 12:53:53

“and dragged off campuses at gunpoint to go off and blow up peasants in pajamas on behalf of Dow Chemical and Union Carbide. ”

Kennedy? Johnson?

Comment by nickpapageorgio
2013-06-09 13:05:24

“this administration can’t hold a candle to Nixon’s excesses.”

Nixon was paranoid and a piker by comparison, Obama’s team of global progressives is diabolical and driven by the desire to not only defeat non progressives but to eliminate them all together.

Moral equivalency will not get the obama team out of this mess.

Comment by ahansen
2013-06-09 13:57:06

More nonsense from the tard — who wasn’t there and who can’t even bother to read his own links.

College deferments were (highly) selectively granted and enforced by locality (and Daddy’s money), with GPAs, enrollment status, and field of study being secondary but important determinants. Moreover, those who resisted were considered top-priority draftees by local draft boards.

In 1969 a lottery system was adopted which removed college deferment from the equation altogether.

And yes, I saw draft resistors arrested in a lecture hall and marched off under armed guard while I was at UCLA. They were subsequently inducted and immediately thrown into military prison. In response, the student body declared a general strike culminating with Angela Davis’s rousing jeremiad and Frank Zappa’s memorable call and response.

Comment by Whac-A-Bubble™
2013-06-09 14:53:46

ahansen — I’m sincerely grateful (and relieved) for your perspective. (I was too young to have a clue when Tricky Dick was in power.)

Comment by Whac-A-Bubble™
2013-06-09 14:55:37


Oops…looks like ahansen’s post woke up the sleeping McCarthy-era troll…

Comment by Neuromance
2013-06-09 15:53:33

“When I was a young man, they told me if I voted for Goldwater, I’d get sent to Vietnam. I voted for Goldwater anyway and sure enough, I got sent to Vietnam!” — anon :)

Comment by Ben Jones
2013-06-09 07:46:27

‘aided and abetted by political enemies’

Everything is always about the Democrats and Republicans, isn’t it?

The question before us is, do we want to live in a police state? That’s where we are headed. We will decide that question. Not the blue team or the red team. This idea that technology is beyond control is ridiculous. We’ve been told all along that it was under control. If anything, we need even stronger rights amidst this new technology! Here’s a tip for all the silicon valley scum in on all this; people will reject your products if spying is part of the deal. No more IPO’s. No more private jets.

This police state, if we allow it, is being run by a two party dictatorship. They’ll pretend to fight like cats and dogs, but they get along just fine when it comes to passing stuff like the NDAA at midnight on new years eve. What’s behind this is the idea of perpetual war. Any country at any point in history will become a police state if it is perpetually at war.

(Comments wont nest below this level)
Comment by scdave
2013-06-09 07:56:27

do we want to live in a police state ??

We already do…The question we are discussing is it going to continue to get worse…With the “Boogie-Man” war on Terror being unleashed, And I suspect it will get worse short of another civil war…

Is State independence an answer ??

Comment by jose canusi
2013-06-09 08:02:36

“We already do”

Well, clearly you are having a discussion different than some are having. We may be living in a police state, the question is, DO WE WANT TO? Get it?

Ah, screw it. Go fiddle with some Ds and Rs.

Comment by non-conformist
2013-06-09 08:12:27

“The question before us is, do we want to live in a police state?”

No, but thanks for asking.

Massive Police Drill in Los Angeles: http://www.infowars.com/massive-police-drill-in-los-angeles/ - 81k - Cached - Similar pages
1 day ago

Comment by scdave
2013-06-09 08:25:45

the question is, DO WE WANT TO? Get it ??

Oh I get it alright…I suppose you capitalized for emphasis ??

Were you pounding the keys with a hammer ??

Get a grip Palmy…We live in a police state the only question is to degree..

Comment by Whac-A-Bubble™
2013-06-09 08:25:51

“Here’s a tip for all the silicon valley scum in on all this; people will reject your products if spying is part of the deal. No more IPO’s. No more private jets.”

I don’t do Facebook. Never have, never will.

And I still suspect their ticker symbol, FB, actually is a secret mocking reference to F-d Buyer.

Comment by CharlieTango
2013-06-09 08:28:11

I do not want to live in a police state. Secret info is already being abused, it is the nature of govt bureaucracies, if they possess it they will abuse it.

The left is mostly defending the police state because they currently have the power to abuse. With the opposition silenced maybe the left will never see the other side of this coin?

Comment by CharlieTango
2013-06-09 08:30:43

This surveillance was forced upon us in secret and now that we know about it we have to accept it because it already exists?

That’s pretty convenient logic.

Comment by jose canusi
2013-06-09 08:40:14

“Get a grip Palmy”

Well, don’t YOU sound JUST LIKE bin Stalin and Feinstein and Clapp-out Clapper and all the rest.

Get used to it, right? You’ll do well in the brave new world.

“Get a grip”.

Listen to the cackling of the depraved, but “reasonable” elites.

Comment by scdave
2013-06-09 08:43:47

I do not want to live in a police state ??

Who the hell does other than the institutions that profit by it ??

Comment by In Colorado
2013-06-09 08:44:29

Here’s a tip for all the silicon valley scum in on all this; people will reject your products if spying is part of the deal

Given the the way the proles will rush out and buy the latest iPhone or Android device, I’m not sure they give a rat’s patootie.

Comment by jose canusi
2013-06-09 09:07:38

“silicon valley scum”

Which gives rise to a new meme: Siliscum Valley.

Look at their laughable profit model: algorithm generated ads. Like the ads for flipper gurus at the top of this blog, what a joke. Yeah, Sheryl Sandberg, lean right into the poop. The only remarkable thing about Sheryl is that she’s a top drawer con artist and did one helluva job convincing businesses that google was delivering value for their advertising dollar. For that I’ll give her props. Also for jumping ship to facebook before people starting whispering that the empress has no clothes.

Speaking of which, if people had any stones, there’d be a mass exodus from FB, now THAT would be a popular rebellion.

But I was speaking to a relative the other day who is firmly convinced that his company needs it for advertising. Says he gets a lot of business from it. Personally I think he’s full of it, but there you have it.

Comment by Housing Analyst
2013-06-09 09:31:13

“Everything is always about the Democrats and Republicans, isn’t it?”

It’s specific to this blog due to the fundamental subject. Change the name to “The Housing Architectural Design Blog” and 95% of the moronic posts disappear.

There is a powerful element that does not want this blog in operation and will do anything to change the subject.

Comment by Whac-A-Bubble™
2013-06-09 09:43:01

I was always partial to Sillycon Valley…and even more so now that I know their real business is spying on almost everybody.

Comment by sad panda
2013-06-09 09:47:30

Given the the way the proles will rush out and buy the latest iPhone or Android device, I’m not sure they give a rat’s patootie.

I think that’s the key. People like us who care about privacy and don’t have FB or google accounts are very small minority. My guess is government will eventually force us to have a FB or google accounts or worse a national digital id in near future. Your privacy is gone for ever. Voyeurs of silli valley in conjunction with voyeurs of DC will rule the world. That’s the future.

Comment by sad panda
2013-06-09 09:55:59

I was always partial to Sillycon Valley…and even more so now that I know their real business is spying on almost everybody.

Social media is all that.

Comment by Mr. Smithers
2013-06-09 10:15:25

Silicon Valley tilts very Democrat/Liberal. Anyone shocked that these people gleefully aided and abetted Obama’s NSA is naive and gullible. And if you think that they will stop, you’re also fooling yourself.

Comment by Mr. Smithers
2013-06-09 10:18:13

“My guess is government will eventually force us to have a FB or google accounts or worse a national digital id in near future”

In WA state you can register to vote via Facebook. How long before you can actually vote via Facebook? By 2020 I think that’s how voting will be done. Facebook, Twitter, Tumblr, whatever.

Or even simpler Text “D” to vote Democrat. Text “R” to vote Republican.

Comment by jose canusi
2013-06-09 10:30:18

” don’t do Facebook. Never have, never will.

And I still suspect their ticker symbol, FB, actually is a secret mocking reference to F-d Buyer.”

I’ve never done it either, it was not one of my ambitions in life to be an asset of Thuggerberg’s. But that’s what all the FB members are, unpaid assets of Thuggerberg’s. He really hasn’t figured out how to make it pay off yet, either, despite the advertising push. Well, not as a service. As a Wall Street IPO, maybe. So what does he care? I’m just glad I didn’t contribute to it.

I like the FB thing, it really fits. Should be FU, though, for F–d User.

Comment by ahansen
2013-06-09 11:20:45

“Everything is always about the Democrats and Republicans, isn’t it?”

“There is a powerful element that does not want this blog in operation and will do anything to change the subject.”

Boffo analysis, Analysis. HB Bubblers, take note.

Comment by Carl Morris
2013-06-09 12:04:51

Or even simpler Text “D” to vote Democrat. Text “R” to vote Republican.

For any other choice send a hand written request in triplicate to the address below no later than 90 days before the election in question and a paper ballot will be provided. Instructions will be available at your local post office. Best of luck.

Comment by Housing Analyst
2013-06-09 13:07:16

“Boffo analysis”


Comment by rms
2013-06-09 13:28:03

“In WA state you can register to vote via Facebook. How long before you can actually vote via Facebook? By 2020 I think that’s how voting will be done. Facebook, Twitter, Tumblr, whatever.”

Why not vote along with filing your taxes? One side is for the taxes and voting on the reverse while your tax hit is fresh in your mind. Don’t pay taxes? You don’t vote. Simple.

Comment by ahansen
2013-06-09 13:59:49

“Boffo”, as in “Smashing” “Brilliant” “Nicely done” “Bravo” “Well -stated” “nailed it”.


Comment by Whac-A-Bubble™
2013-06-09 14:10:56

“I’ve never done it either, it was not one of my ambitions in life to be an asset of Thuggerberg’s.”

Bearing in mind that FB started out as a web site to rate Harvard chicks’ @%%es ought to be enough to remind you never to post there.

Comment by alpha-sloth
2013-06-09 14:45:14

Is State independence an answer ??

Because a state would never spy on us?

Comment by alpha-sloth
2013-06-09 14:47:41

started out as a web site to rate Harvard chicks’ @%%es

Facebook was originally A$$book? That’s awesome! Are there archives?

Comment by Whac-A-Bubble™
2013-06-09 15:02:26

“That’s awesome! Are there archives?”

You’ve gotta get out more (or rent more movies).

The Social Network #6 Movie CLIP - Erica Albright (2010) HD

Comment by Whac-A-Bubble™
2013-06-09 15:10:38
Comment by Mr. Smithers
2013-06-09 15:13:27

“Why not vote along with filing your taxes? ”

Well for starters, WA doesn’t have an income tax, nothing to file.

Comment by ecofeco
2013-06-09 15:35:02

Try Internet Archives


Comment by alpha-sloth
2013-06-09 16:59:27

Try Internet Archives

It’s no use, I can’t find the A$$book period. It’s gone with the wind, my friends, gone with the wind.

Comment by ahansen
2013-06-10 00:43:36

You could only get on it with an @harvard.edu account. It wasn’t for external consumption. It also got MZ put on disciplinary suspension.

Comment by Whac-A-Bubble™
2013-06-09 07:13:37

I realize this may sound like somewhat of a leading question, but Are you worried that housing is headed for another bubble — a steep rise, then a crash?

Comment by azdude
2013-06-09 07:18:27

I’m not worried. Its guaranteed to happen. the bubble economy in assets can make u a fortune if you know how to handle it.

Comment by Whac-A-Bubble™
2013-06-09 07:19:33

By Roger Showley
12:01 a.m. June 9, 2013 Updated
7:01 p.m. June 7, 2013

No: Perhaps the most important reason why a second housing bubble won’t occur anytime soon is because the last one occurred. Last time, the groupthink was that housing prices would not decline on a massive national scale — they never had. That bubble has burst. Currently, housing prices are increasing in response to low inventories, but half of the home sales are cash purchases and distressed sales. As house prices rise, the cash and distressed sales will decline (falling demand) and more for-sale units will come onto the market (increasing supply) and the pressure behind the rise in prices will ease to a sustainable level.

Yes: With the ratio of the region’s housing price to household income spiking, San Diego’s housing market seems headed into bubble territory again. Continuing as one of the nation’s least-affordable housing markets because of this ratio, San Diego home prices are not so much driven by organic consumer demand but by investors speculating on prices further rising. At the same time the inventory of available housing diminishes, with relatively little new construction in the pipeline adding to supply. Pressures are mounting to drive prices further upward to where workers will be unable to purchase or even afford to rent homes.

Comment by non-conformist
2013-06-09 07:23:41

Ask major financial institutions like The Blackstone Group L.P.

“Major financial institutions like The Blackstone Group L.P. (NYSE/BX) have become major buyers in the U.S. housing market. Blackstone has spent more than $4.0 billion for 24,000 homes in the U.S. housing market that it plans to rent out.”

BlackRock was founded as BlackStone Financial Management within the private equity firm Blackstone Group in 1988. Larry Fink, BlackRock’s founder and CEO, had joined Blackstone in 1988 as a partner, along with Ralph Schlosstein, former White House aide under the Carter administration, and Robert Kapito and Sue Wagner. Before joining Blackstone, Fink was a managing director at First Boston, where he pioneered the mortgage-backed securities market in the United States.

Comment by ecofeco
2013-06-09 15:36:53

“…where he pioneered the mortgage-backed securities market in the United States.”

Tells you all you need to know right there.

Comment by Whac-A-Bubble™
2013-06-09 07:28:50

Are we headed for another housing bubble?
6:12 AM, May 29, 2013
Home recently sold (Photo: Getty Images)
USA Today

The rapid run-up in housing prices the past year has ignited talk of another housing “bubble,” but only a few markets are at risk - so far, experts say.

U.S. home prices rose 10.9% in the 12 months ending in March for their largest annual gain in seven years, according to the latest Standard & Poor’s Case-Shiller index released Tuesday.

Even with that rise, home prices are about 28% off their 2006 peaks, Case-Shiller says.

There’s zero case to be made that we’re in a housing bubble,” says John Burns, CEO of Burns Real Estate Consulting.

Comment by Whac-A-Bubble™
2013-06-09 07:34:01

The entire discussion of the myriad pieces of evidence on whether we are seeing the return of the housing bubble or the birth of a new one can be boiled down to a single burning question:

Is this a good time to buy?

Comment by Whac-A-Bubble™
2013-06-09 07:35:02

6:03 pm - May 22, 2013 — Updated: 5:03 pm - May 29, 2013
Pop goes the market: Are we headed toward another housing bubble?

“Las Vegas seen as most undervalued home market in U.S.”

“Survey: Nevada leads U.S. in home price gains”

“Report: Las Vegas posts biggest monthly home price rise”

“Southern Nevada homeowners starving for state, federal aid”

“Las Vegas new-home sales surge 94 percent in 2013”

“Deciding whether to rent or buy a home getting more complicated”

“Report: Las Vegas among top spots to ‘flip’ homes”

“New home sales up, but market remains fragile, analyst says”

Seven years ago, the fuse was lit, here in Las Vegas, on a fiscal bomb that eventually would destroy the economy and usher in the Great Recession.

Easy-credit mortgages were handed out like cheap Halloween candy to people with no proof of income. Or literally no income at all. The effect of all that borrowed money was to rapidly push up the price of housing, and here in Southern Nevada, the hyperinflation of housing prices led the country, quarter after quarter. The savage increases would have chased buyers away, but because the banks were lending money to anyone, anyone could get a mortgage.

And as long as housing prices escalated, everyone was happy. But a slight downward tick of the economy in 2006, which any other time might have been shrugged off, led to casinos tightening their belts with layoffs.

The laid-off employees suddenly couldn’t pay their mortgages, especially the exotic balloon payments that lenders promised could be refinanced. Only now there was no credit available for refinancing. Seemingly overnight, Las Vegas led the nation in mortgage defaults. It turned out that those loans and similar loans handed out in other rapidly developing parts of the Sunbelt — Florida and Arizona — had been sold and resold so many times that they had become an industry on their own. Thousands of families lost (and are still losing) their homes here, but the default crisis was suddenly a lot bigger than Southern Nevada.

It was a global catastrophe. International banks, insurers and financial giants collapsed. The economy went into a tailspin. The bubble that was Las Vegas growth turned into a bomb that took with it more than a decade of investment and trillions out of the economy.

So Las Vegas homeowners, would-be buyers and sellers might be excused for being very, very nervous about speculative real-estate bubbles. And they might be thoroughly confused by today’s newspaper headlines.

Is this a good time to buy?

Comment by Tarara Boomdea
2013-06-09 09:32:36

About Vegas: I was listening to a local Vegas radio show yesterday hosted by a RE agent “short sale specialist” and his mortgage broker co-host.

I think the RE agent has gotten religion. Throughout the show he was screaming SELL, making his broker co-host break out in an audible sweat. The agent has already sold his home and investment properties. Since his biz is short sales, he has a lot of contact with the banks (who he says are processing foreclosures as fast as they can) and groups that are buying properties here (two of the five groups have told him they are no longer interested.)

He says he only has five regular buyers on tap for all his listed properties. He wants to get out of the business (probably has made a ton) and that he can’t believe this is happening to Las Vegas again. His time estimate for things to completely normalize - five years.

The mortgage broker was weakly protesting that it’s a good time to buy and said that he couldn’t believe how much in commissions the RE agent just lost by making that statement (actually, he’s been yelling “sell” for months not just yesterday.)

A friend of mine here keeps pressuring me to buy. I’m sick of renting (high rents here), but I just can’t bring myself to do it.

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2013-06-09 09:44:38

“Throughout the show he was screaming SELL, making his broker co-host break out in an audible sweat.”

By all means, please post a link to the audio file if you have one…

Comment by Tarara Boomdea
2013-06-09 10:07:28

I’ve looked for podcasts - none. They’re on again today, KXNT, 100.5 FM, 3 to 5 PM.

I think a repeat of (maybe yesterday’s? show) is on KDWN, 720 AM, 4 to 6 PM today.

Comment by Tarara Boomdea
2013-06-09 15:09:25

The show that is on KXNT 100.5 FM right now is a repeat of yesterday’s show.

Comment by scdave
2013-06-09 07:35:07

Are you worried that housing is headed for another bubble ??

Headed ?? We are in the middle of a full blown one around here…Its insane…

a steep rise ??

We have already seen the steep rise…Will it continue I just don’t know but the demand/supply equation is way out-a-whack….Add to that the interest rates and a much improved economic picture around here and this is what you get…

Then a Crash ??

Just don’t know…Change the equation I describe above and we will definitely go flatline as a minimum…Change it in significant ways we could easily see a 10-20% pull back…

With that said, there is another thing that I have thought much about and that is the 3% loans that are all in place around here…I have a new neighbor…30 somethings with two kids…I don’t think they will care if the price goes up or down…Their not sellers…They are in for the long term…Just wondering how systemic that may be around here…

Comment by Whac-A-Bubble™
2013-06-09 07:37:18

Is This Another Bubble? We Can’t Know Without Better Data
By the Editors May 16, 2013 3:00 PM PT

Are the easy-money policies of the world’s central banks setting financial markets up for a crash? We would have a much better idea if we measured how much of the buying is being done with borrowed money.

In recent months, soaring prices of stocks and bonds have left many investors wondering whether the potential returns are worth the risk. The Standard & Poor’s 500 Index (SPX) is in record territory despite a weak economic recovery. Junk bonds included in a BofA Merrill Lynch index are yielding only 4.4 percentage points more than U.S. Treasuries, close to the narrowest spread since late 2007.

So is it a bubble? To get a sense, it is helpful to know what is driving prices higher. If investors are putting in very little of their own money and using a lot of borrowed money, also known as leverage, that can be a troubling signal.

When, for example, lenders allow people to buy a $100,000 house with a down payment of only $1,000, they give speculators immense power to bid up prices beyond the reach of those who want houses to live in. Similarly, if someone with only $1 million can borrow enough to buy $100 million in risky bonds, traders looking for quick gains can push prices up to levels that make little sense for people who want bonds as a source of fixed income.

Disastrous Dynamic

Leverage makes the whole financial system more fragile. Investors who use only their own money can lose no more than 100 percent of what they put in. By contrast, an investor who uses $1 million of his own money and $99 million of borrowed money to buy $100 million in securities can be wiped out by a price drop of only 1 percent: The new value of the investment, at $99 million, is just enough to pay off the debt. Larger declines can force investors to sell other assets to pay their creditors — a dynamic that can turn seemingly isolated losses into widespread disasters.

Comment by Whac-A-Bubble™
2013-06-09 07:39:40

Housing ‘Double Bubble’ May Be on Rise in Calif.
June 4, 2013
Bethany Clough

Quickly rising home prices have some people wondering if California real estate is experiencing another bubble — and is soon headed for another crash.

It’s not, says Don Faught, the president of the California Association of Realtors, who was in Fresno on Friday. Too many factors are different this time around, he said at a meeting at the San Joaquin Country Club.

Talk of such a “double bubble” stems from rising home prices. The median home price in Fresno rose 19% over the last two years, the Fresno Association of Realtors reported at a a recent real estate forecast. Prices have risen at a similarly speedy rate statewide.

The median price of an existing home in Fresno County was $170,000 in April — up $30,000 from the same month last year, according to the most recent report by real estate research company DataQuick. (A median is the midpoint on a scale and is different from an average).

Comment by Whac-A-Bubble™
2013-06-09 07:51:17

California ‘Double Bubble’ Forming?
The Fresno Bee | By Bethany Clough Posted: 06/01/2013 1:21 pm EDT

Quickly rising home prices have some people wondering if California real estate is experiencing another bubble — and is soon headed for another crash.

It’s not, says Don Faught, the president of the California Association of Realtors, who was in Fresno on Friday. Too many factors are different this time around, he said at a meeting at the San Joaquin Country Club.

Comment by Whac-A-Bubble™
2013-06-09 07:53:14

Housing outlook is bubble free for now, economists say
Real estate conference
Economists Lawrence Yun, left, Jed Kolko and Mark Fleming discuss the outlook for housing at the National Assn. of Real Estate Editors conference in Atlanta. (Lauren Beale / Los Angeles Times / June 7, 2013)
By Lauren Beale
June 7, 2013, 9:25 a.m.

ATLANTA — Despite double-digit price gains in many markets, the housing outlook is bubble free for now as the sector recovers over the next several years, experts say.

Kicking off a panel of economists addressing a gathering of journalists, Lawrence Yun of the National Assn. of Realtors said he expected a multiyear recovery as home price growth lifts more owners out of underwater situations and helps the economy.

Housing wealth is easily offsetting the negative effect of sequestration,” Yun told the National Assn. of Real Estate Editors. But the normally housing bullish economist tempered his optimism because double-digit increases in home prices are outpacing income growth. “Any time that happens over a sustained period it is an unhealthy state for the country.”

Four of the next five years should see continued price growth, Yun said. “We will still be shy of pre-bubble years.”

Comment by Whac-A-Bubble™
2013-06-09 07:55:10

Housing bubble? Top economists weigh in on recovery
Friday, June 7, 2013

ATLANTA — Overall, their message was positive: sales will continue to grow, more homes will come on the market and prices shouldn’t fall. But three of the country’s top thinkers in real estate communicated their concerns to the National Association of Real Estate Editors here Friday morning.

Lawrence Yun of the National Association of Realtors warned of double-digit home price growth.

Combined with rising mortgage rates, he said, prices are “outpacing people’s income growth,” which creates “have and have-nots.”

Homebuilding needs to ramp up in order for price gains to moderate.

After a period of overbuilding during the housing bubble, followed by underproducing in recent years, new housing inventory is at a 50-year low, Yun said.

There just aren’t as many builders in the market.

During the boom, development was supplemented by small, local builders who are now shut out of the market because they can’t get construction loans.

The lending market for consumers also remains tight.

Based on loan approvals, Yuan said about 15 to 20 percent of the population can’t get mortgages.

Mark Fleming of CoreLogic said there have been few periods of time in the last 30 to 40 years where housing has been a good investment from a financial perspective.

“If prices grow faster than the interest rate, it’s positive and slower it’s negative,” he said.

And Jed Kolko, Trulia’s chief economist, said the national housing market has recovered by only about 50 percent.

But even though prices are rising quickly, Kolko said, “we are not in bubble trouble.”

Comment by Whac-A-Bubble™
2013-06-09 07:58:24

June 6, 2013
What housing bubble?
Posted by Ryan W. McMaken on June 6, 2013 11:57 AM

According to Trulia, home prices in May in Los Angeles were up, year over year, by 17 percent. No problem! This is no doubt a long term trend. Home prices always go up.

Atlanta prices were up 13 percent, and Dallas prices were up 11.1 percent over the same period.

Do you think wages and income for the average family have increased 10 percent or more over the past year? It seems not.
June 7, 2013
Re: What housing bubble?
Posted by Karen De Coster on June 7, 2013 04:57 AM

Ryan, even more interesting are the ‘economists in the street’ (regular folks) who like to make comments such as, “it’s about time [home prices went back up].” These are Average Joes who hope that housing prices move upward so their houses are “worth more” on paper, and yet the reality is that they pay more for property while they are being deceived about their real asset wealth.

Tyler Durden just wrote about the bubble on Zero Hedge in his article about the “Housing Bubble 2.0.” For a good laugh, read Karl Smith’s assessment (on Forbes) of why a new housing bubble is likely. The best comment I can muster about this piece is … incredibly flawed.

Comment by Whac-A-Bubble™
2013-06-09 08:04:36

Lots of the confusion about whether or not this is a new bubble stems from definitional issues. I suggest basing the definition on price dynamics; e.g., a market where an unsustainably high and accelerating rate of price appreciation leads to speculators piling in and tail-chasing the market upwards to a crash. Like happened in 2007.

Jobs in home construction, real estate sales, home furnishings, etc do not have to increase one iota for prices to bubble and crash.

If the US is in a new housing bubble, where are all the home-building jobs?

By Tim Fernholz @timfernholz
June 7, 2013

With US home prices rising and more new homes being built, people are fretting about the possibility of a new housing bubble. But as we’ve argued, average home prices suggest it’s still early to be talking about one. And here’s another indicator: if there’s a bubble, where are all the construction jobs?

As you can see in the chart above from today’s jobs report, there aren’t nearly as many people, either construction workers or residential specialty contractors, at work today as there were just five years ago. It’s no surprise that we’re not back at the levels of the housing bubble, when the number of new homes under construction and the people working on them exceeded demand. Fannie Mae, the US housing finance corporation, estimates that only 412,000 new home construction jobs will be added between 2012 and 2016, but even then, it expects one million fewer builders than the 2006 peak, when 3.5 million were hard at work.

Comment by Whac-A-Bubble™
2013-06-09 08:06:57

Skyrocketing home prices cause some economists to fret
As more homes come to market and mortgage costs move higher, it should keep the market from getting out of hand, top industry economists say.
Real Estate Editor
Published: 07 June 2013 08:31 PM
Updated: 08 June 2013 02:50 PM

ATLANTA — Soaring home prices across the country are causing concerns that the housing market may be overheating again.

But top industry analysts say that rising mortgage rates and more inventory hitting the market should cool things before another bubble forms.

We hope that it begins to moderate. These double-digit price gains are not healthy,” said Lawrence Yun, chief economist with the National Association of Realtors.

Comment by In Colorado
2013-06-09 08:48:28

Soaring home prices across the country

I think that there are many places that aren’t seeing soaring prices. They are mostly in flyover and therefore are ignored.

Comment by Mr. Smithers
2013-06-09 10:44:53

Wait, you mean a family of 4 doesn’t want to live in a 1 bedroom apartment after all? And parents want their kids to have a room of their own and a yard? I am shocked. I truly am. I was told repeatedly that the days of big houses were over and McMansions would all be bulldozed in favor of 700 sq ft apartments in the inner city. This is all so very confusing.

NEW YORK (CNNMoney) —As the economy recovers, America’s love affair with the oversized McMansion has been reignited.
During the past three years, the average size of new homes has grown significantly, according to a Census Bureau report released Monday. In 2012, the median home in the U.S. hit an all-time record of 2,306 square feet, up 8 percent from 2009.

During the recession, Americans downsized and the average new home shrunk in size by 6 percent over two years to 2,135 square feet. At the time, many industry experts said the days of the McMansion were over. The shrinkage was supposed to indicate that a new era had begun, with young buyers seeking to live closer to urban cores and settling for smaller places and baby boomers downsizing after their kids had flown the nest.

But it wasn’t that consumers wanted less space, many just couldn’t afford more, said Jeffry Roos, a regional president for home builder Lennar. And now that the economy is improving, they’re demanding bigger homes again, he said.”

(Comments wont nest below this level)
Comment by Housing Analyst
2013-06-09 13:12:07

Yes Slithers…. you’re confused. And your employers aren’t getting their moneys worth because you really suck at this messaging thing.

Comment by Whac-A-Bubble™
2013-06-09 14:08:08

I have to suspect that paid prostitutes just don’t have their hearts in their work the way people who post here for fun do.

Comment by Mr. Smithers
2013-06-09 15:19:53

Got it. Anyone who doesn’t believe houses can be built for $50/sq ft (including land) is a prostitute for the (cue evil music) POWERS-THAT-BE.

This is the cousin of Godwin.

Comment by Whac-A-Bubble™
2013-06-09 15:47:14

“Anyone who doesn’t believe houses can be built for $50/sq ft…”

You yourself publicized here that you work for the Evil Megabanks. I just so happen to have a reasonably good memory.

Comment by Housing Analyst
2013-06-09 17:46:53

Well Slithers we build for $50/sq all week long. And we’re profitable at $55/sq.

Have you ever built anything Mr. Slithers?

Comment by Whac-A-Bubble™
2013-06-09 08:09:13

Updated June 8, 2013, 8:24 p.m. ET
Corporate Buyers Boosting Prices in House-Sales Boom

Double-digit home-price gains from San Francisco to Detroit to Miami have some aspiring home buyers racing back into the market.

But buyers, beware.

The housing market may not be as strong as you think.

Sure it’s tempting to want to lock in a low interest rate and take advantage of lower home prices before they rise further.

But it may make sense to take a breather before you buy a home and wait for prices to drop, as institutional investors might be inflating home prices.

Namely, Wall Street investors are scooping up homes in bulk, and there’s considerable concern this is inflating prices in certain areas of the country—and pricing individuals out of the market in general.

These institutional investors have been spending billions of dollars buying up single-family homes en masse. In 2012, institutional buyers purchased about 138,540 of both distressed and non-distressed homes in the U.S., or about 3% of all sales, according to RealtyTrac. It estimates institutional buyers purchased 32,355 homes in the U.S. in the first quarter of this year, or about 3.5% of home sales.

That may sound like a small amount of purchases, but in certain markets institutional investors are taking a larger stake. For example, institutional buyers accounted for 5% and 8% of sales in Arizona and Nevada, respectively, so far this year.

And some of the hottest markets for big corporate buyers from 2010-2012 are seeing some of the biggest price jumps this year—Phoenix, Las Vegas, the San Franciso Bay Area, portions of Florida and elsewhere.

Comment by Whac-A-Bubble™
2013-06-09 08:16:04

Dallas Fed’s Richard Fisher sees no U.S. housing bubble yet
By Sheryl Jean
5:00 pm on June 7, 2013

The rapidly recovering U.S. housing market is not in a bubble — not yet, Richard Fisher, president of the Federal Reserve Bank of Dallas, said earlier this week.

“We have a booming housing market,” Fisher said in an interview with Canada’s BNN television. “I don’t think it’s a bubble yet, but it has corrected enormously, so my personal view would be to slow the rate of acceleration.”

Last month, Fisher suggested that the Federal Reserve start paring down its $85-billion-a-month bond-buying program starting by reducing its purchases of mortgage backed securities. The central bank is buying more than $40 billion a month in mortgage-backed securities, he said.

BNN separated Fisher’s interview into two video segments. His housing comments are in the first video clip. The second video clip is more about investors, bonds and inflation.

Comment by Whac-A-Bubble™
2013-06-09 08:20:45

After reading (or at least skimming) one recently-issued expert assurance after another that we definitely are not in another housing bubble, I feel so much better now. I’m headed back to bed for another half hour of Sunday morning shuteye, to be followed with the morning pot of coffee.

And may the odds be ever in your favor.

Comment by Whac-A-Bubble™
2013-06-09 08:37:14

I couldn’t resist adding one more expert opinion, from a longtime HBB favorite commentator:

Home prices soaring back, economists say, but don’t cry bubble yet
Drew Harwell, Times Staff Writer
Saturday, June 8, 2013 4:30am

Home sales are hot. Prices are climbing. Supplies are increasingly tight.

All these positive signs for the housing market are nice, but many wonder the same thing: Is this a new bubble, or what?

It’s easy to see how today’s housing market could trigger flashbacks to the frothy mid 2000s boom. Bidding wars are rampant, deals are quick, and investors and flippers abound.

But economists say there are plenty of reasons to be skeptical that the market is blowing bubbles. Homes are still undervalued. Banks are tightfisted with loans. And prices will likely cool before they burst.

There are still some strange signs afoot. But economists argue this is what an awakening market looks like, with the first signs of recovery at work.

It’s all part of this metamorphosis from the downtrodden housing market to something that resembles normalcy again,” University of Central Florida economist Sean Snaith said.

It looks like, as we’re coming out of the depths, that there’s a bubble forming, when really we’re still trying to get back to the surface.”

Comment by Whac-A-Bubble™
2013-06-09 13:50:35

Analysts say recession looms
Study points to increasingly slow housing market
By Bruce Spence
Record Staff Writer
June 20, 2007 12:00 AM

A slowdown in the housing market has stalled the U.S. economy nearly enough to push the country into a recession, but growth rates are expected to increase, according to the latest prediction from the UCLA Anderson Forecast.

Last fall, the Forecast saw the national economy heading for a soft landing, although one with much turbulence because of rapid deterioration in the housing market.

National economic growth in the first quarter of this year came in at an anemic 0.6 percent, senior Forecast economist David Shulman said. That is a dramatic drop from well more than 2 percent in the fourth quarter of 2006, and the lowest growth rate since the fourth quarter of 2002.

A further decline is not expected, but Shulman predicted economic growth in the second and third quarter will come in at less than 2 percent, climbing to barely more than 2 percent in the fourth quarter.

“This is not a recession, but it is certainly close,” he said.

The report said the implosion of the subprime mortgage market in the first quarter triggered a second slowdown in housing activity. Housing starts are expected to slow down even further, Shulman said, with only a modest recovery next year.

“Moreover, housing prices will likely head inexorably lower with a national peak to trough price decline on the order of 10 percent that will likely extend into 2009,” he wrote in the report to be released today.

Retail sales stalled in April and auto sales have weakened, leading to the suspicion that weakness in the housing market and high gasoline prices are hurting consumer spending, Shulman said.

Any economic strength is coming from a booming global economy, which is powering the U.S. stock market to new highs, he said, but even there, the United States is lagging behind Europe and Japan.

Shulman concluded that with an expected lower rate of core inflation and a 5 percent unemployment rate by the fourth quarter, the Fed is expected to cut interest rates by 75 basis points starting in the fourth quarter.

By mid-2008, the economy is expected to have moved beyond the housing decline, the trade deficit will have improved, and moderately strong business investment will put the economy back on a 3 percent-plus growth path.

In the forecast for California, Forecast economist Ryan Ratcliff said falling house sales, weak prices and rising foreclosures continue to rule the housing market.

“But in spite of all this bad news from real estate, the wider California economy is mostly unfazed: Job growth has slowed only slightly and we’ve seen only a minor uptick in unemployment,” he said.

Ratcliff said he doesn’t see any calamitous implosion of home prices in the near future. Home prices are expected to continue flat or falling slightly for some time to come, he said.

Sean Snaith, director of University of Central Florida’s Institute for Economic Competitiveness and consultant to University of the Pacific’s Business Forecasting Center, said there’s no doubt that the weight of the “housing adjustment” is bearing down on the national and California economies.

But Snaith still stands behind his well-known description of the housing market as a soufflé that deflates but doesn’t collapse. The collapse of the subprime market hit the housing market hard, pulling the economies down more than expected, he said.

“I think the housing hangover is going to last a little longer than we thought,” he said.

Still, while Anderson economists more than a year ago were warning of the dangers of a recession from the housing downturn, he predicted his housing soufflé would continue to prove accurate with no related plunge into recession - and that appears to be turning out to be correct, he said.

He sees economic growth as rising to more than 2 percent for the remaining quarters of this year and the housing market beginning to return to normalcy by mid-2008.

Comment by Rental Watch
2013-06-09 17:25:33

Short answer: Yes.

Longer answer: I think that some places are already in bubble territory both in prices and attitudes. I think that other places are not even close to bubble territory on prices, but the attitude is already bubbly (which will get prices to rise faster). My real fear is that the PTB gives debt to anyone with a pulse again which will be the fuel for the rapid run up in prices in most places to be followed by a crash. However, absent debt markets getting “2004-2006 Stupid” (which was pretty damn stupid), I don’t think the next bubble OVERALL will be as severe as the last one.

Comment by Housing Analyst
2013-06-09 18:01:49

Rental Watch,

You’re untrustworthy. You don’t know the truthful answer to anything. Why? Because you continually exaggerate and misrepresent housing in spite of the fact you have a stake in the direction of prices.

What did you pay for the house you bought in 2011?

Comment by Whac-A-Bubble™
2013-06-09 07:22:12

Turns out the really rich guys who own stocks don’t care whether CEOs get paid gobzillions of dollars while the poor slobs take home a mere pittance, provided the stock prices keep going up.

Who’d've thunk?

Comment by Whac-A-Bubble™
2013-06-09 07:25:56

Stocks keep highest-paid CEOs on top
By Mike Freeman
4 p.m.June 8, 2013

Average pay of local corporate chieftains rose last year; shareholders seem more interested in own returns than in curbing executive compensation

Comment by jose canusi
2013-06-09 07:51:18

On another note, would anyone be able to give some input on the 1099 phenomenon? I’ve been doing some reading on line and it looks as if the W-2 is going the way of the dodo.

But here’s what I don’t get: my understanding is that under 1099 subcontractor, the contractor may not dictate the hours and place of work, nor may they direct the work, because that would constitute an employer/employee relationship.

However, it seems as if some, maybe many companies are trying to
assert an employer/employe relationship, while paying on a subcontract basis. Is this maybe just a Florida thing? I ask because I’ve run into this twice in as many weeks. I actually don’t mind the subcontract thing, I in fact perfer to do short term gigs here and there without some dick on my back constantly, but in both cases all of a sudden I ran into this “the hours are from x to y, with a break for lunch”, wait, WAIT, WTF? (One guy did look sort of sheepish and said “Well, ahem, we really can’t tell you when to work, but the best hours are…”) And then these non-compete and non-disclosure agreements, which I laugh at anyway.

And it’s not just me, two friends of mine have run into the same thing.

Comment by CharlieTango
2013-06-09 08:35:11

Its just not Florida, these trade offs exist everywhere. In a cooperative environment it works out but as soon a meaningful dispute arises the employer is at risk.

Comment by jose canusi
2013-06-09 08:49:20

Charlie, another thing, also the son of one of my buddies is going to school and looking for a part time gig. He’s smart as a whip and a great kid. Problem is, he’s looking for like 20 hours max and he’s responding to ads for “part-time” jobs that turn out to be 32 hours a week, with a unpaid hour lunch. Which is basically full time. That tells me that companies are in fact looking for full timers, but gaming the system. They don’t even want to speak to him unless he’ll commit to “part time” 32 hours a week.

Comment by In Colorado
2013-06-09 08:55:20

I’ve never heard of hourly people getting paid for their lunch break.

(Comments wont nest below this level)
Comment by jose canusi
2013-06-09 09:12:06

That wasn’t my point. My point was advertising a “part time” job but making it effectively full time, where you pretty much have to be on site for 8 hours. I mean, where you gonna go for that unpaid lunch?

32 hours a week with an hour unpaid lunch added equals pretty much full time.

Comment by Combotechie
2013-06-09 09:30:45

“I’ve never heard of hourly people being paid for their lunch break.”

It depends on the type of job one has. The company I work for pays for lunch breaks on the off shift but not for the regular shift. The regular shift is mostly geared up for scheduled work and has enough employees available during the regular shift for overlaps. Not so the off shift; The off shift is mostly set up for non-scheduled work, work that requires an employee to be on hand in case of an immediate need.

An employee is expected to be on hand and to work through his lunch period and thus the policy is to pay him for these lunch periods.

Comment by Combotechie
2013-06-09 09:34:31

An extreme example of this would be the fire department. There are no unpaid luch breaks in the fire departments because it would be unreasonable to have firefighters to shut down fire fighting operations in the middle of a fire so as to go to lunch.

Comment by In Colorado
2013-06-09 15:32:53

32 hours a week with an hour unpaid lunch added equals pretty much full time.

Uh, no … it’s 32 hours, because you don’t work during your unpaid lunch break. You can go to Burger King or brown bag it in the lunch room.

Comment by CharlieTango
2013-06-09 09:05:04

If all of the ads are misleading then another source of potential employers is called for. “Beating the pavement” perhaps?

I recently hired a young guy from Florida because he kept coming buy in the mornings asking for work. He’s now moving up the latter

(Comments wont nest below this level)
Comment by In Colorado
2013-06-09 08:52:37

I’m waiting for the day when they try to squeeze 8+ hours a day with only 8 hours of pay out of contractors. You know, like they do now with employees.

Comment by scdave
2013-06-09 08:57:22

8+ hours a day with only 8 hours of pay out of contractors ??

They have done that for ever…Piece work…It even happens with union guys although more difficult to accomplish…

Comment by CharlieTango
2013-06-09 09:11:02

When I was young I did piece work while in the carpenter’s union. I used to go home before 1:00 with 9-11 hours pay.

The way you get away with it as an employer is, in the event of a dispute you pay the hours and then fail to find more work for the employee.

(Comments wont nest below this level)
Comment by scdave
2013-06-09 09:40:56

pay the hours and then fail to find more work for the employee ?

Exactly Tango….Called the “Silent Hammer” in the construction industry…And, everyone knows it…

Comment by rms
2013-06-09 09:13:36

As a subcontractor I can assure you that there are frequently 10-hrs worked stuffed in an 8-hr payday; happens all the time. I never cut corners, and I stay until the job is finished.

Comment by scdave
2013-06-09 09:45:21

I can assure you that there are frequently 10-hrs worked stuffed in an 8-hr payday ??

I don’t think Tango would disagree…I think he was just trying to demonstrate that piece work can also work in your favor if you are really good & fast at what you do…But, mistakes can happen…Delays are common and a pice worker can also get his a$$ handed to him as far as wage per hour of work…

(Comments wont nest below this level)
Comment by CharlieTango
2013-06-09 12:09:00

I always treated piece work rates as a minimum amount of pay I would accept. Because I could beat the rates generally if I couldn’t make my wages the problem was with the bid rate not me.

A good way to dispute this is to hand your tools over to the boss or estimator and have them demonstrate that the rate is make able.

You will only be forced to accept a rate where you can’t make your hours if you have a weak position or if work is in short supply.

Comment by Mr. Smithers
2013-06-09 10:12:59

“I’m waiting for the day when they try to squeeze 8+ hours a day with only 8 hours of pay out of contractors. You know, like they do now with employees.”

The whole point of contracting is to get paid by the hour. If you work 8+ hours and only get paid 8 hours, you might as well be a W2 employee cube dweller.

Comment by Bill in Los Angeles
2013-06-09 13:58:13

Exactly. But in reality with this recession there are clients out there who will tell consultants they do not pay overtime. The consultants who work only 40 hour weeks are more likely to be let go than the consultants who work the most “free” overtime. I’ve seen this happen at the current site. It’s why I am still consulting there. It is one of the things that bugs me, so I have to retrain myself in other areas that are in demand so that when they do push me out I have the expertise to hit the ground running at a new client site where they DO have you work overtime. It happened before and it will happen again. I had one situation where the manager made us all attend a meeting. We were supposed to work 60 your weeks and we had to each tell her which days we will be working. For me it was 7 days a week, nine hours per day. Paid every hour.

(Comments wont nest below this level)
Comment by ibbots
2013-06-09 09:33:40

There is a 20 factor test that was enumerated in the Microsoft case. The primary factor is - who controls the means of production? If an ‘employer’ dictates hours, you use their equipment, etc., you look alot more like an employee.

If on the other hand they provide an assignment and a deadline and you are left to your own devices, and you do work for more than one company, you look more like a traditional contractor.

If you want the IRS to make a determination, you can submit an SS-8 form to them and they will collect info and let you know. A determination that an employment relation exists usually results in a liability to the employer and relief from self employment tax to the worker. The IRS shares this info with state taxing authorities as well.

It should be noted that if you earn more than ~$60k of self employment income, it may be worthwhile to form a separate entity, have the ‘employer’ pay the entity, and the entity can pay a salary to you. Of course, you don’t pay 100% of the entity’s earnings as salary. Only a portion, and take the rest as an owner distribution free from employment tax.

YRMV but for there are real savings in this method.

Comment by jose canusi
2013-06-09 10:24:51

Thanks, ibbots. Good info. We did that when we had a rep firm back in the day.

Comment by Happy2bHeard
2013-06-09 10:44:44

That 20 factor test has been around for a long time. Tech people were exempt until the tax reforms passed in 1986.

From Wikipedia: http://en.wikipedia.org/wiki/Tax_Reform_Act_of_1986

Tax treatment of technical service firms employing certain professionals [edit]

The Internal Revenue Code does not contain any definition or rules dealing with the issue of when a worker should be characterized for tax purposes as an employee, rather than as an independent contractor. The tax treatment depends on the application of (20) factors provided by common law, which varies by state.

Introduced by Senator Daniel Patrick Moynihan, Section 1706 added a subsection(d) to Section 530 of the Revenue Act of 1978, which removed “safe harbor” exception for independent contractor classification (which at the time avoided payroll taxes) for workers such as engineers, designers, drafters, computer professionals, and “similarly skilled” workers.

If the IRS determines that a third-party intermediary firm’s worker previously treated as self-employed should have been classified as an employee, the IRS assesses substantial back taxes, penalties and interest on that third-party intermediary company, though not directly against the worker or the end client.[8] It does not apply to individuals directly contracted to clients.[9]

The change in the tax code was expected to offset tax revenue losses of other legislation Moynihan proposed that changed the law on foreign taxes of Americans working abroad.[10] At least one firm simply adapted its business model to the new regulations.[11] A 1991 Treasury Department study found that tax compliance for technology professionals was among the highest of all self-employed workers and that Section 1706 would raise no additional tax revenue and could possibly result in losses as self-employed workers did not receive as many tax-free benefits as employees.[12]

In one report in 2010, Moynihan’s initiative was labeled “a favor to IBM.”[13] A suicide note by software professional Joseph Stack, who flew his airplane into a building housing IRS offices in February 2010, blamed his problems on many factors, including the Section 1706 change in the Internal Revenue Code, though no intermediary firm is mentioned, and failure to file a return was admitted.[14]

Comment by Whac-A-Bubble™
2013-06-09 08:42:46

McKinsey: Nation’s nest eggs stuck in ’09
June 6, 2013, 3:43 PM
By Matthew Heimer

By most measures, the economy is doing much better today than it was in 2009, and stock markets are certainly in better shape. But average Americans are no better prepared for retirement than they were in those relatively dark days – or so says a study released this week by the financial-services practice group at the consulting giant McKinsey & Co.

The firm maintains a “Retirement Readiness Index” (RRI) that takes into account Social Security, pension and defined-contribution plans, real estate and other savings and measures those assets against people’s projected retirement-income needs. On a scale of 1 to 100, where 100 means a household could sustain its pre-retirement standard of living, the national average score on the index stands at 64, up only slightly from 63 in 2009. At that level, McKinsey says, a person can afford to retire only by “cutting spending on essential needs such as housing, food and healthcare.” Put another way, the firm says that a present-day middle class family would need about $61,000 a year in income to sustain its current lifestyle, and would fall short of that mark by about $20,000.

Comment by sad panda
2013-06-09 09:53:35

And McKinsey and its highly paid consultants were right there advising firms on how to “maximize” profits.

Comment by Mr. Smithers
2013-06-09 12:16:42

“And McKinsey and its highly paid consultants were right there advising firms on how to “maximize” profits.”

Would you prefer firms minimize profits instead? That’s the reason - the ONLY reason - a corporation exists. To maximize profits. That’s all. Any corporation that doesn’t seek to maximize profits will not last long,

Comment by Whac-A-Bubble™
2013-06-09 14:15:40

“That’s the reason - the ONLY reason - a corporation exists. To maximize profits. That’s all.”

Eddie sez…

(Comments wont nest below this level)
Comment by non-conformist
2013-06-09 18:55:26

“That’s the reason - the ONLY reason - a corporation exists. To maximize profits. That’s all.”

It offers protection from personal liability.

Comment by non-conformist
2013-06-09 19:20:20

“It offers protection from personal liability.”

Among some other perks that I would rather not mention with you know who doing you know what to people that don’t think like you know who.

Comment by In Colorado
2013-06-09 15:28:32

I hate to say this Smithers, but not even biz school text books say that.

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2013-06-09 15:43:09

He makes sh!t up and posts it here all the time. Get over it.

Comment by In Colorado
2013-06-09 16:27:04

He makes sh!t up and posts it here all the time.

I know, and so does bananaboy, but it’s fun to contradict them. I have been considering adding Smithers to my Joshua tree list, though.

Comment by Whac-A-Bubble™
2013-06-09 09:49:47

There has never been a better time to dump your bonds and buy stocks!

June 7, 2013, 5:30 a.m. EDT
Where to put your money when bond yields rise
Commentary: The best defense is a good stock-driven offense
By Jonathan Burton, MarketWatch

SAN FRANCISCO (MarketWatch) — The investing paradigms, they are a-changin’ — and it’s time to get your stock portfolio in synch.

Bond yields have been rising as the U.S. economy improves, and so has market volatility. The defensive, income-rich stock and bond strategies that have rewarded investors for years won’t lead the markets when the economy is less distressed.

In such an unfamiliar situation, what sort of stocks do you add to your portfolio, and what do you trim?

First, it helps to understand where we are. U.S. stocks in coming months will tell a tale of the taper. Investors are concerned that the Federal Reserve will unwind its quantitative easing program — the massive bond purchases that have suppressed yields and succored stock buyers.

The mere thought of “QE-lite,” floated in several Fed-launched trial balloons, has sent investors into withdrawal. Buyers have shown displeasure by punishing Treasurys, dividend-paying stocks and other interest-rate sensitive assets.

The spike in the 10-year Treasury yield is alarming but shouldn’t be surprising. Investors know the day will come when the economy will have recovered enough for the Fed to normalize its policies. Yields in that environment will go higher and bond prices will drop, which will be more than a bit disturbing for income-focused investors.

The reckoning isn’t here yet, but bond funds’ losses and dividend-stock funds’ underperformance in May offered a grim glimpse of what could be. The largest bond fund, Bill Gross’s Pimco Total Return (PTTAX -0.45%), shed 2.2% in May — its worst month since 2008.

Comment by Bill in Los Angeles
2013-06-09 13:43:07

Treasuries and precious metals bullion, 50/50 split. Keep an eye on Series I bond fixed rates. fixed is 0% now, so not worth investing. Start buying them if they are above 1%.

Comment by Whac-A-Bubble™
2013-06-09 14:06:00

Are you going for long-term Treasurys?

Buy when everyone else is selling and hold until everyone else is buying. That’s not just a catchy slogan. It’s the very essence of successful investing.

– J. Paul Getty –

Comment by Bill in Los Angeles
2013-06-09 16:07:13

oops no! T-bills only for now. 2 year notes? Maybe if yields get to 2%.

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2013-06-09 20:18:16

Are y’all ready for a three-decades-long bear market in long-term bonds and investment-grade real estate?

Comment by Whac-A-Bubble™
2013-06-09 20:19:30

Bonds look like sure losers right now
By Barrack Yard Advisors
Published June 09, 2013

The biggest factor affecting future rates-of-return on any investment is the price you pay for it. Buy good assets at a reasonable price or cheaper and you’re bound to do well if you hold them long enough - so long as a paradigm-shift, a change in the way the world works, doesn’t destroy the asset’s value. This can include expropriation of private property by a previously business-friendly government or the failure to adapt to change by individual companies or industries.

In such a case, the ability of the asset to generate cash for the owner is forever impaired and losses can become permanent. In the US stock market, think buggy whip manufacturers in the 1890s, newspaper publishers a century later, or more recently, highly levered investment banks.

So long as you avoid getting killed by a paradigm-shift, and don’t grossly overpay, you’ll be alright as an investor if you’re patient. Overpaying for an asset, even a quality one, is an entirely different situation and can result in a very long wait indeed before you’re OK.

In the case of stocks, you might wait a market cycle or longer. Most quality tech stocks remain below their highs from the last great bull market. Wonderful companies like Cisco Systems, EMC, Intel, and Microsoft are today lower than they were in February 2000, by some 40-70%. It’s a lesson in what happens if you buy a scary expensive asset: though many of these companies have grown their businesses at an impressive double-digit clip during the last 13 years, the growth wasn’t fast enough to compensate for a P/E ratio contraction from 50 times earnings to 10-12x.

In the case of other asset classes, it could take even longer to get your money back if markets move against you. Bond trends, for example, are generational because the debt cycle is so long. The current bull market in bonds is over 30-years old and the previous bear market in bonds also lasted some three decades. In the case of investment grade real estate, illiquidity adds a further painful possibility.

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2013-06-09 09:52:09

June 9, 2013, 7:46 a.m. EDT
10 things economists won’t tell you
Why the future of the economy is as tough to predict as the weather
By Quentin Fottrell

1. “We can’t predict the next crisis…”

As political gridlock in Washington threatens to stall a U.S. economic recovery, investors are once again turning to economists for guidance on what the future holds. But a Ouija board may serve them just as well. From Federal Reserve chairman Ben Bernanke on down, most economists failed to predict the 2008 financial crash. In his 2011 paper, “An Award for Calling the Crash,” Mason Gaffney, a professor of economics at the University of California, Riverside, offers this postmortem: “The crash of 2008 surprised most of us. The episode has led many to ask how economists could have been so in the dark.”

And this wasn’t an isolated event. The majority of economists have been surprised by everything from the Great Depression and the spike in oil prices during the 1970s to the bursting of the dotcom bubble in 2000 and 2001, says Laurence Ball, a professor of economics at Johns Hopkins University. What made it difficult to predict the mortgage crisis was that “subprime mortgages did not really exist 15 years ago,” he says. Economists look at past events to figure out what’s coming next, but some events are without precedent. “The world changes quickly,” Ball says.

Such explanations provide little solace for regular investors, many of whom look to economists as bellwethers. “You can’t create a model for the world. Even in projecting interest rates, income and inflation, too much can go wrong,” says Robert Schmansky, founder of Clear Financial Advisors in Bloomfield Hills, Mich. And when economists don’t forewarn others, he says, investors suffer. In late 2008 as stocks were free-falling, Schmansky says, many of his clients were scrambling to liquidate their stock portfolios because they too were caught by surprise.

Comment by Bill in Los Angeles
2013-06-09 13:35:41

“Why the future of the economy is as tough to predict as the weather”

B-B-B Most HBBers know how to time the market. They snicker at Dollar Cost Averaging into stocks. So what’s going on here?

Comment by Whac-A-Bubble™
2013-06-09 13:53:34

The MSM-annointed real estate ‘experts’ completely missed the first leg down in the housing bubble collapse, and I expect them to completely miss the next one as well. Moreover, I don’t expect them to own up to their ineptitude when the rear-view mirror of economic history shows their housing market recovery predictions to be abject failures.

Comment by Combotechie
2013-06-09 14:25:29

“… time the market ….”

Not time, price.

Bargains are a function of the price, not the clock.

Comment by Mr. Smithers
2013-06-09 15:21:34

“B-B-B Most HBBers know how to time the market. They snicker at Dollar Cost Averaging into stocks. So what’s going on here?”

When you scream CRASH IS COMING, CRASH IS COMING every day for years, you’re bound to be right sometime.

Comment by Whac-A-Bubble™
2013-06-09 15:39:31

Strawman troll alert

(Comments wont nest below this level)
Comment by Housing Analyst
2013-06-09 17:51:53

Slithers….. your messaging is off……. Do your employers have any idea of your ineffectiveness here?

Comment by Whac-A-Bubble™
2013-06-09 14:03:40

Lessons learned from the Fall 2008 economic collapse and its aftermath:

1) It doesn’t matter if an economist’s prediction is way off the mark, provided it is no worse than those of his peers.

2) Almost all the economists who pretend to be able to predict the future are male.

3) Other than helping those who were misled on the way to the poor house, no serious harm is done by completely mistaken economic forecasts; for instance, nobody dies, except for the guys who lose everything and jump off bridges or tall buildings, or gun down their immediate families before turning their weapon on themselves.

4) So long as “nobody could have seen it coming,” you won’t be held accountable for your failure to anticipate a financial panic. This even goes for missing panics that are already in progress, such as the one that started in August 2007 and kept on going through March 2009 and perhaps longer if you count the lingering damage to the labor market.

5) I have to assume weather forecasting is different. For instance, I’m guessing if a weather forecaster predicted “sunny” while a tornado was clearly visible through the window of the office where he sits, he would be relieved of his forecasting duties. By contrast, whether or not accurate, their forecasting services are likely to remain in demand so long as economists are willing to make lame remarks to the press.

Comment by Whac-A-Bubble™
2013-06-09 14:25:42

Is this what happens in a typical economic recovery?

More Americans committing suicide than during the Great Depression
Sat May 18, 2013 12:27PM

A new report issued today by the Centers for Disease Control and Prevention finds that the overall suicide rate rises and falls with the state of the economy - dating all the way back to the Great Depression.

The report, published in the American Journal of Public Health, found that suicide rates increased in times of economic crisis: the Great Depression (1929-1933), the end of the New Deal (1937-1938), the Oil Crisis (1973-1975), and the Double-Dip Recession (1980-1982). Those rates tended to fall during strong economic times - with fast growth and low unemployment - like right after World War II and during the 1990s.

During the depths of the Great Depression, suicide rates in America significantly increased. As the Globe notes:

The largest increase in the U.S. suicide rate occurred during the Great Depression surging from 18 in 100,000 up to 22 in 100,000 …

We’ve previously pointed out that suicide rates have skyrocketed recently:

The number of deaths by suicide has also surpassed car crashes, and many connect the increase in suicides to the downturn in the economy. Around 35,000 Americans kill themselves each year (and more American soldiers die by suicide than combat; the number of veterans committing suicide is astronomical and under-reported). So you’re 2,059 times more likely to kill yourself than die at the hand of a terrorist.

Comment by Prime_Is_Contained
2013-06-09 15:03:58

More Americans committing suicide than during the Great Depression

I remember a conversation on the HBB back in ‘05/’06, predicting this very thing…

So, no, not what you would expect in your “typical” recovery…

Comment by rms
2013-06-09 20:50:13

“More Americans committing suicide than during the Great Depression”

Isn’t committing suicide against the law?

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2013-06-09 21:09:59

Yeahbut kinda difficult to enforce…

Comment by non-conformist
2013-06-09 10:21:29

How dare they question their betters like this!

Watch Becky Gerritson’s entire testimony on her treatment by the IRS

2:51 PM 06/04/2013

Vince Coglianese has the highlights of Wetumpka [Alabama] Tea Party President Becky Gerritson’s testimony before the House Ways and Means Committee here.

Here we have a woman who most of our moral, ethical, and intellectual betters in the media and the Democratic Party (PTR) would consider “ordinary.” But she just did something extraordinary. She explained — eloquently, in great detail, and with an entirely suitable sense of outrage and sadness — her mistreatment at the hands of the United States government. A government that is not only irrevocably bloated and inefficient, but has now been proven to be actively hostile to dissenters against the current administration.

And more importantly, she looked the representatives of that government straight in the eye and reminded them of a simple fact that continues to elude them: They work for us.

Thank you, Mrs. Gerritson. Now get ready for the left to try to intimidate you into silence.


http://dailycaller.com/2013/06/04/watch-becky-gerritsons-entire-testimony-on-her-treatment-by-the-irs/ - 82k -

“the campaign of shame is taking place across the media spectrum,” further commenting that the “mass media” seek to “hold themselves up as our betters” and “wanted to make a point that this is what happens in Bumpkinville.” From the May 6 edition of Cam & Company:

G&A: Fellow talk show host Piers Morgan has been on an anti-semi auto crusade lately. What are your thoughts on this?

CE: I think Piers is the perfect embodiment of the authoritarian mindset that we’re seeing more of lately. It’s not that Piers thinks banning these guns will actually accomplish anything, from what I understand. He seems to be stuck on the question of, “Why would anyone own one of these things?” Since he can’t justify it, it’s therefore fine to get rid of on principle, even if we’re not actually safer. Why his opinion matters more than, say mine, for instance, is something I have yet to hear him explain. It’s an incredibly elitist attitude. We’re the bumpkins, so of course we need our betters to tell us what we can and cannot do.

Comment by jose canusi
2013-06-09 12:06:35

Check out the goo-goo news aggregator page. They’re gonna go after the “leakers” in the media, oh boy, are they EVER.

Two thoughts about this: I believe in a free press, so I don’t like to see it. What does this even mean, a leaker in the media??? Isn’t that what the media does, investigate and then publish? How is that “leaking”?

OTOH, you can’t say the media doesn’t have it coming, given their penchant to act like PRAVDA on behalf of the goobermint and whatever the party line is. Can’t have it both ways, hard lesson learned.

They’ll find some poor SOB down the food chain and give him the Bradley Manning treatment.

Comment by jose canusi
2013-06-09 12:24:10

LOL, right on cue, here comes the poor slob down the food chain to take the hit for “leaking”.


Comment by jose canusi
2013-06-09 13:01:26

If this dude is the real deal, I honor him. But I wouldn’t be so quick to say I’m not afraid because I haven’t done anything wrong. People do the right thing all the time and get savaged.

Comment by ahansen
2013-06-09 14:01:18

Just look at Bradley Manning.

(Comments wont nest below this level)
Comment by jose canusi
2013-06-09 12:27:41

“Dude, you’re getting a Dell!” (Oh, gawd, I can’t stop laughing, must. wipe. tears. from. eyes)

My other posts haven’t shown up yet, so this will make no sense until they do, but trust me, it’s all good. (snort, snarfle, giggle, chortle, belch.)

Comment by Housing Analyst
2013-06-09 13:09:01

Never trust a single word from a realtor. EVER.

Comment by non-conformist
2013-06-09 14:23:11

Why did the Realtor cross the road?

To lie to the person across the street.

Comment by Housing Analyst
2013-06-09 17:43:52


Comment by ecofeco
2013-06-09 20:27:46


Comment by rms
2013-06-09 20:52:51

+1 Bear, someday I gotta buy ‘ya a drink. LOL!

Comment by Whac-A-Bubble™
2013-06-09 14:14:24


This may be the best tornado video I have ever come across. It even features a happy ending with birds audibly chirping!

Comment by non-conformist
2013-06-09 17:31:15


Jamie the Junkie Pt. 1–A Candid Conversation With A Seattle Heroin Addict

http://www.youtube.com/watch?v=CAuYqVJSJRI - 202k -

Comment by Whac-A-Bubble™
2013-06-09 20:23:40

Heh heh heh…


True Economics Applied in the Real World

We are a team of dedicated Bitcoin mining professionals and long time supporters of the crypto-currency movement with a strong passion for the Bitcoin community and big ideas for the Bitcoin market place.

We are looking to expand existing mining operations. We have been mining for nearly 2 years and have a significantly large “Private / Dedicated” server room infrastructure, with controlled personnel only access, equipped with dedicated power generators capable of handling massive power loads, UPS power backups for maximum equipment uptime and protection from power surges, a 4 Ton cooling unit to support a large scale mining operation.

Comment by Whac-A-Bubble™
2013-06-09 14:43:18

Can’t speak for all middle-class Americans, but austerity is definitely starting to catch up with our household consumption expenditures.

June 9, 2013, 8:00 a.m. EDT
The sequester may start to show in data
Retail sales, industrial production data to be in focus
By Greg Robb, MarketWatch

WASHINGTON (MarketWatch) — So far, signs that sequestration and higher tax rates have damaged the economy have been few and far between.

The White House press corps has begun to regularly pepper Obama spokesman Jay Carney with questions about whether the administration cried wolf when it warned about damage from federal government cutbacks that went into effect on March 1.

The sequester looks to me like it is more a May story than an April story,” said Ethan Harris, co-head of global economics research at Bank of America Merrill Lynch.

Comment by Whac-A-Bubble™
2013-06-09 14:47:24

Poll: Do Americans have more to fear from China’s hired hackers or the U.S. government?

China’s hackers 8(7%)
U.S. government 104(91%)
Undecided 2(1%)
Other 0(0%)

Comment by In Colorado
2013-06-09 15:22:53

Well, it was a Washington Times Poll. That would be like a Mother Jones poll showing Americans fear corporations the most.

Comment by non-conformist
2013-06-09 15:14:49

HARP Lifts Us Up Where We Belong - YouTube
http://www.youtube.com/watch?v=zje20q1eRCY - 210k -

Who knows what tomorrow brings
In a world, few loans survive
All I know is the way i feel
When it’s real, I keep it alive

The loan is long, there are payments in our way
But we climb a step every day

HARP lifts us up where we belong, where the renters cry
On a mountain high
HARP lifts us up where we belong, far from the world
We know, where bill collectors don’t go

Some hang on to used to be
Live their lives, loking behind

All we have is here and now
Our bailout, out there to find

The loan is long, there are payments in our way,
But we climb them a step ev’ry day

HARP lifts us up where we belong, where the renters cry
On a mountain high
HARP lifts us up where we belong, far from the world
We know, where late payments don’t grow

HARP Re-Upped Until 2015

(Dec. 31, 2015 not like it’s 2016 or anything)

by Broderick Perkins
May 1, 2013

Apparently, a federal refinance program with the staying power to help 2.2 million homeowners ascend from underwater mortgages is buoyant enough to float for another two years.

The Federal Housing Finance Agency (FHFA) recently directed Fannie Mae and Freddie Mac to extend the Home Affordable Refinance Program (HARP) until Dec. 31, 2015.

The Obama Administration’s Making Home Affordable refinance
relief program was set to expire Dec. 31, 2013.

Apparently HARP’s successes have been sufficient even without hardier upgrades.

Many HARP critics said the program should also include Federal Housing Administration (FHA) mortgages and other loans.

However, the program has also played a part in the housing recovery by giving struggling homeowners time to hold out until values returned.

Along with the extension, FHFA plans to launch a public outreach program to inform homeowners about the program.

HARP Re-Upped Until 2015 - Realty Times
http://realtytimes.com/rtpages/20130501_harpextended.htm - 52k -

Comment by Mr. Smithers
2013-06-09 15:24:52

Nothing like a good old fashioned vote buying scheme. Since HBB voted for this guy practically unanimously, enjoy your tax dollars being spent on other people’s mortgages. Schadenfreude is delicious in the morning.

Comment by Whac-A-Bubble™
2013-06-09 21:08:59

“Since HBB voted for this guy practically unanimously,…”

Lies, damned lies and Eddietard posts…

Comment by Whac-A-Bubble™
2013-06-09 15:49:52

Stock investors, start your engines, as more monetary stimulus to offset recent signs of weakness is in the bag.

Comment by Whac-A-Bubble™
2013-06-09 15:51:24

June 9, 2013, 2:43 p.m. EDT
China data shows slowing of growth
By Wallace Witkowski, MarketWatch

SAN FRANCISCO (MarketWatch) — Economic growth in China slowed in May according to government reports released over the weekend.

China’s producer price index fell 2.9% in May, a pick-up in speed from the 2.6% on-year decline reported in April. Economists expected an average 2.5% decline.

Also, curbs on lending, with total social financing dropping about a third to 1.19 trillion yuan ($194 billion) in May from April risks slowing China’s economic growth even further.

Total property investment rose by 20.6% for the first five months of the year, compared with a 21.1% rise year-to-date in April.

Fixed-asset investments in non-rural areas for the year increased 20.4%, compared to an expected 20.5% rise.

Industrial production slowed slightly in May with a 9.2% increase for the year, compared with a 9.3% year-to-date rise in April.

Inflation also grew at a slower-than-expected pace with the China consumer price index up 2.1% in May from the year-ago period. Economists surveyed by Dow Jones expected a 2.5% increase on average.

One pickup in the data was in May retail sales. May data showed China retail sales rose 12.9% for the year, compared with a 12.8% year-to-date rise in April.

The data comes after China’s export growth slumped unexpectedly even thought (SIC) its trade surplus widened in May.

Comment by Whac-A-Bubble™
2013-06-09 18:03:45

It sure must be fantastic to live and work in a country whose economy only experiences the occasional slowdown, without ever experiencing a full-blown recession.

June 9, 2013, 8:21 p.m. EDT
China’s economy slowing; government may not care
By Michael Kitchen, MarketWatch

LOS ANGELES (MarketWatch) — Economists seem to agree that China’s economy is slowing, but the real question seems to be whether the government is worried enough to offer some sort of policy response.

A slate of Chinese data out over the weekend suggested a further slowdown in growth, with industrial production and property investment easing their expansion in May, and exports rising by far less than expected.

Only retail sales rose at a faster rate, up 12.9% last month from the year-earlier period, compared to 12.8% growth in April.

While many of the metrics held to double-digit expansion, the downward trend and doubt over the accuracy of some of the data had many economists describing the results as “weak.”

“The May economic indicators suggest that the Chinese economy is on the path of a weak recovery, but domestic demand remains on the soft side,” wrote analysts at J.P. Morgan.

“The big challenge for the economy remains the continuous softening in manufacturing investment, which is related to overcapacity and declining rate of return on investment,” they wrote.

Likewise, Société Générale economist Yao Wei was quoted by Dow Jones Newswires as saying: “There is no sign of full recovery in the Chinese economy, and a strong rebound this year is unlikely.”

Comment by Bill in Los Angeles
2013-06-09 16:10:47

Roubini on December 14 2009, for one of his reasons why that day he said Gold will tank:

“central banks will eventually need to exit quantitative easing and effectively zero policy rates, which will put downward pressure on risky assets including commodities.”

We’re waiting Mr. Roubini, we’re waiting.

And since December 14, 2009 (that day the gold price was $1150 per ounce) gold went up to $1900 per ounce nearly two years later.

Comment by Whac-A-Bubble™
2013-06-09 18:00:02

“We’re waiting Mr. Roubini, we’re waiting.”

Stopped-clock fallacy: What has thus far never come to pass will never come to pass.

Comment by Whac-A-Bubble™
2013-06-09 19:59:48

Is there some kind of magical significance to a gold price of $1150/oz?

Comment by Whac-A-Bubble™
2013-06-09 20:01:04

Gold Seen Falling to as Low as $1,150/Ounce: Technical Analysis
By Marina Sysoyeva - Apr 26, 2013 12:47 AM PT

Gold may resume declines as soon as next week, triggering a drop to about $1,150 an ounce, according to technical analysis by Auerbach Grayson & Co.

The attached chart shows that gold has broken below its trend line from the 2008 low and its 50-week moving average, and went beneath the 200-week moving average for the first time in 11 years. A price rebound that saw it climb 12 percent since it dropped to a two-year low of $1,321.95 in London on April 16 will probably end in a few days or weeks and selling should resume, according to Richard Ross, global technical strategist at the New York-based brokerage firm.

Ultimately we see a decline down to $1,150,” Ross said yesterday by e-mail. The target is near a 61.8 percent retracement of the metal’s rise from the Sept. 12, 2008 close to the Nov. 11, 2011 close, one of the levels singled out in so- called Fibonacci analysis, he said. “Importantly, we must consider further selling down to the magical round number at $1,000.”

(Comments wont nest below this level)
Comment by Whac-A-Bubble™
2013-06-09 20:06:54

At least the Eurozone economic crisis is over.

Comment by Whac-A-Bubble™
2013-06-09 20:07:58

ECB says it has no set limit to bond-buying
Monday, 10 June, 2013 [Updated: 5:19AM]
France’s President Francois Hollande. Photo: AFP

There is no limit to the European Central Bank’s bond-buying programme, the bank said yesterday, a day after France’s President Francois Hollande announced Europe’s debt crisis was over.

The German newspaper Frankfurter Allgemeine Sonntagszeitung yesterday quoted central bank sources as saying the bank had set a limit of €524 billion (HK$5.38 trillion) on the Outright Monetary Transactions scheme.

The bank had also informed Germany’s constitutional court, which will weigh the scheme’s legality on Tuesday and Wednesday, of that limit, it said.

However, the ECB said: “The report is incorrect. As indicated on various occasions, there are no ex-ante limits on the amount of Outright Monetary Transactions. Their size would be adequate to meet their objectives.”

Meanwhile, Hollande told an audience in Japan during a state visit: “You must understand that the crisis in the euro zone is over.”

Hollande’s comments came a week after thousands of people took to the streets of European cities to vent their anger at the “troika” of international powers whose insistence on austerity is blamed for worsening their economic hardship.

There were angry scenes in Frankfurt near the European Central Bank, and in Spain and Portugal, two of the countries that have received bailouts to help them plug financial holes.

The troika of international lenders, the International Monetary Fund, the European Union and the European Central Bank, have imposed strict conditions on countries such as Greece and Portugal in exchange for bailout funds. In Greece and Spain, the unemployment rate has reached 27 per cent, while Portugal’s is forecast to climb to a record 18.2 per cent this year.

Comment by Whac-A-Bubble™
2013-06-09 20:09:59

United Daily News: Taiwan becoming an economic laggard
2013/06/09 18:16:31

In its annual white paper released last week, the American Chamber of Commerce in Taipei issued a dire warning about Taiwan’s possible marginalization while criticizing the Taiwan government’s restrictive rules and regulations.

Because of the unfavorable environment created by these constraints, it said, Taiwan ranks second to last among 17 Asian countries — behind Sri Lanka and ahead of only Pakistan — in attracting private equity fund investment.

In earlier years, people in Taiwan used to ask: “If Japan can do it, why can’t we?” The question implied an intention to do even better. In the last decade or more, however, Taiwan’s performance in the economic field has been lackluster, gradually falling behind the other Asian Tigers (Hong Kong, Singapore and South Korea).

Taiwan’s economy has fared particularly poorly in the past few years, with difficulties resulting from a worsening brain drain and rising public debt. People are sometimes so pessimistic that they are starting to ask a different set of questions: “Are we becoming like the Philippines?” and “Are we going down the road that Greece has taken?”

Comment by Bill in Los Angeles
2013-06-09 16:02:35

Roubini: Here’s Five Reasons the “Barbarous Relic” Gold is going to Tank



Gold was $1150 per ounce around the date of the article. Went as high as $1900 in October 2011. A stopped watch is correct twice a day?

Roubini does not understand gold - James Rickards

Comment by Whac-A-Bubble™
2013-06-09 18:01:24

If Rickards sez it, then it must be so.

Just like when Eddie sez it.

Comment by Whac-A-Bubble™
2013-06-09 21:18:26

Is anyone who reads and posts here buying long-term bonds now?

If so, why?!

Note the article below focuses on the smallish May losses on the 10-yr, while ignoring the truly ginormous carnage on 30-yr Treasurys.

Bond rout: Just a blip or sign of bleak future?
By Andrew Osterland
Jun 9, 2013 @ 12:01 am (Updated 8:50 am) EST

Investors are getting a taste of what rising interest rates can do to their fixed-income portfolios, but bond experts don’t think that the sharp rise in rates last month signals a coming rout in the market.

The yield on the 10-year Treasury bond was up 46 basis points in May, resulting in a loss of 3.7% for the month.

The benchmark Barclays U.S. Aggregate Bond Index, which tracks the broader bond market, was down 1.92%, and every bond fund category except for bank loans had a negative return, according to Morningstar Inc.

“May was one of the worst 20 months for the 10-year bond since 1950,” said Chris Orndorff, senior portfolio manager at Western Asset Management Co. “When market rates are 7% or 8%, a 50-basis-point move isn’t a big deal, but when rates are this low, it is.”

The burning question for financial advisers and their clients is whether the rate spike last month was merely a reaction to the rally in March and April or the beginning of a sustained rise from historically low interest rate levels that could wreak havoc on investment portfolios for years to come.

“This last run was pretty abrupt, and we may see some bounce-back, but interest rates were going to go up, and it’s as good a time as any for that,” said Jim Heitman, an adviser with Compass Financial Planning.

He admittedly has been wrong about rates for the past two years but still thinks the only direction they can go from here is up.

“I’ve been wrong for a while, but I may be right this time. This could be the beginning of the process,” Mr. Heitman said.

Comment by Whac-A-Bubble™
2013-06-09 23:34:30

Talking about all the reasons why this is not a housing bubble = WHISTLING AS YOU STROLL PAST THE GRAVEYARD.

Guess what, folks? It doesn’t work. The zombies are watching you , and will attack, whether you whistle loudly, softly or not at all.

Comment by Whac-A-Bubble™
2013-06-09 23:37:20

Looks like the BOJ just executed a massive liquidity dump!

Name (required)
E-mail (required - never shown publicly)
Your Comment (smaller size | larger size)
You may use <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong> in your comment.

Trackback responses to this post