Bits Bucket for June 27, 2013
Post off-topic ideas, links, and Craigslist finds here.
The Housing Bubble
Examining the home price boom and its effect on owners, lenders, regulators, realtors and the economy as a whole.
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Name:Ben Jones
Location:Northern Arizona, United States
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OSU professor receives nearly $1 million to study vacant lots in Cleveland
Wasn’t the state of Ohio paying him already?
Is there some mystery as to why the lots are vacant??
But don’t you dare suggests government workers are overpaid.
Realtors® are LIARS
“Even in the absence of the excess empty housing inventory estimated in the tens of millions, historically housing prices fall. Why? Because houses depreciate. ALWAYS.”
Snap ‘em up, to the tipping point!
Until mortgage rates hit 10.5%, buying will still be cheaper than renting
Forbes
The recent rise in mortgage rates has made buying a house a little more expensive: the increase in the 30-year fixed rate over the past month from 3.4% to 3.9% (Freddie Mac) raised the monthly payment on a $200,000 mortgage by $56, or 6%. However, because mortgage rates are still near long-term lows, and because prices fell so much after the housing bubble burst and remain low relative to rents even after recent price increases, buying is still much cheaper than renting. That means that the recent jump in rates doesn’t change the rent-versus-buy math much.
Each local market, of course, has its own mortgage rate “tipping point” when renting becomes cheaper than buying a home. At 3.9%, buying is cheaper than renting in all of the 100 largest metros, which means the tipping point is above 3.9% everywhere. The tipping point is lowest in San Jose, which would tip in favor of renting if rates reach 5.2%. It’s between 5% and 6% in San Francisco and Honolulu, and between 6% and 7% in New York and Orange County, CA.
But for 78 of the 100 largest metros, the tipping point is 10% or higher. In fact the tipping point is above 20% in Cleveland, Memphis, Detroit, and several other metros in the Midwest and South.
http://homes.yahoo.com/news/until-mortgage-rates-hit-10-5—buying-will-still-be-cheaper-than-renting-225920815.html
“Until mortgage rates hit 10.5%, buying will still be cheaper than renting”
I’m pretty sure the study is flawed, as the massive capital losses which those who buy now are destined to incur are doubtless assumed away.
It’s a common error, ignoring the inverse relationship between interest rates and house prices. It’s the basis for every article decrying ‘Buy now before interest rates rise and make home ownership more expensive.’ It should read ‘Interest rates are rising, be patient while home values slide.’
Exactly. When you make 50k, there’s only so much monthly payment you can make. Unless 40 yr or 50 yr mortgages become the norms.
Or maybe American houses will henceforth no longer be lived in by families, but bought and sold vacant like Beanie Babies by all-cash Chinese, Canadian, investment bank and hedge fund investors.
I’m sure very few actually planted their tulip bulbs once the bubble was in full swing.
And sadly, Forbes didn’t include carrying costs. The comparison was mortgage versus rental rates.
The truth?
When all carrying costs are included, rental rates are a mere fraction of the cost of buying at current massively inflated asking prices of resale housing.
And sadly, Forbes didn’t include carrying costs
There is no comparable to my rental in San Mateo . I have a sixth floor apartment near downtown across from the library that I pay $1464 (soon to be $1680) for. It’s only 700 square feet but fine for my needs. If I wanted to buy a condo on the sixth floor near downtown - first - there’s only one building that offers that and that would be 2 million dollars. Yes the square footage and amenities are much better but the location is key. If I were fine with a second or third story - I’m still looking at $700,000 but then no fantastic view.
It’s the same if I wanted to rent a duplex or cottage - many available for rent but none that I could buy - would have to spend double or triple or quadruple for a regular sized house.
If I were looking at other condos for rent, the ones I could afford to rent are in better locations than the ones I could buy. Plus if I bought a condo I’d possibly be stuck later if too many of the condos were rentals because a potential buyer couldn’t get a loan from the bank. Or unforseen repairs might be needed to be made to the complex and I might be screwed.
That’s not going to happen in a rented apartment.And my money is not tied up in an “investment” It’s sitting in the bank making real money.
I agree with everything you posted right up to the last sentence…Nobody is making any “real” money in a bank these days…
+1
That’s our situation too, athough in a metro with lower rents.
That’s the second paragraph.
WRONG AlWog.
Forbes didn’t do any of that. The article was written by Trulia….. A National Assocation of Realtors company.
http://trends.truliablog.com/2013/03/rent-vs-buy-winter-2013/
I don’t have time to read this now but did they include all costs of owning? Or only the PI part of PITI? And did they just completely forget about maintenance? Rent (unless the landlord is stupid) also covers preventative maintenance, updating, upgrading, and replacing things.
Last thought - I thought Forbes was a more highbrow publication at some point in the past. In the last 2-3 yrs, everything I read there is basically junk.
Spending weekends at Blowe’s or Loan Depot is for loosers.
Cleveland, Memphis, Detroit
Ooh, is that meant to be red meat thrown out there to lure 2Ban?
But higher interest rates lead to lower house prices.
Housing Prices Crater 11% In Exclusive Los Angeles Neighborhoods
http://picpaste.com/pics/15b0288c9a4ed6710dfd98adbfae729c.1372250662.png
Housing Prices Tumble 5.7% In Trendy Bay Area Enclaves
http://picpaste.com/pics/b9d42ef12b4520b212c5bec1975d701c.1372251016.png
If you take on mortgage debt at current massively inflated housing prices, you’ll enslave yourself for the rest of your life.
“Debt is bondage.”~ Suze Orman, May 11, 2013
Don’t Be A Debt Donkey®
“purchase the least amount of home that meets your needs”
“bear in mind, too, that bidding wars have returned… if your budget is $300,000… you should be shopping for homes listed at $270,000″
- Suze Orman , O magazine July 2013 p 43
And how’s that working out considering $300k is 225% higher than long term affordability trend?
Let me help you out with that question………
Answer: Not so well Mr. Housing Analyst. Housing demand is at 17 year lows because prices are grossly inflated.
another re-run of the same posts today?
And you’ll never recover financially.
spending all this equity is real tough.
Spoken like a true 30K millionaire.
http://www.urbandictionary.com/define.php?term=30k%20millionaire
“Liberating the equity in your home” is marketing-speak for “taking out a loan and putting your house up as collateral.”
“Liberating the equity in your home” is marketing-speak for “taking out a loan and putting your house up as collateral.”
Yes. Notice he keeps saying “equity” and not “profits.”
“Spending equity” is exactly what a “30k millionaire” does because he/she doesn’t really have a pot to piss in. People who are spending their equity away are amongst the least financially savvy people in the world. They seldom even consider they have to pay it back.
Song about 30K millionaires in AZ.
http://www.youtube.com/watch?v=oKwA8pFJvJc
“Comment by azdude
2013-06-27 05:34:13
another re-run of the same posts today?”
How much RE do you own, mogul?
Apparently, he doesn’t “own” much of anything since yesterday he said he was pulling some equity to buy a new car. Because nothing says smart investing like paying interest for 30 years to finance a vehicle that depreciates 40% the minute you drive it off the dealer lot.
Livin the dream, with a variable rate HELOC.
life is good my friends. lobster and fine wine tonight while you have your big macs.
“Comment by azdude
2013-06-27 05:58:06
life is good my friends. lobster and fine wine tonight while you have your big macs.”
Again, Dingleberry, just how much RE do you own? Show me how rich and powerful you are. Confound me with your amassed wealth. Show me some of your properties and how much they have appreciated. I am on the fence. Convince me to buy now. Show me that you are more than just another f@cked buyer, wallowing in your misery and longing for company so that you won’t feel quite as hopeless and bitter as you sound.
party time bro!! Off to pick up another case of wine thx to bernake.I love free equity!!
“Comment by azdude
2013-06-27 06:22:45
party time bro!! Off to pick up another case of wine thx to bernake.I love free equity!!”
Exactly as suspected, no substance whatsoever. Just another windbag poser who bought too high, lost their @ss in RE and now wants some company in housing purgatory. Anustart.
A FOX, caught in a trap, escaped with the loss of his “brush”. Henceforth, feeling his life a burden from the shame and ridicule to which he was exposed, he schemed to bring all the other Foxes into a like condition with himself.
He publicly advised them to cut off their tails, saying “that they would not only look much better without them, but that they would get rid of the weight of the brush.” One of them said: “If you had not yourself lost your tail, my friend, you would not thus counsel us.”
A Mouse, imagining himself a FOX, caught in a trap….
I’m going to bet a fin that azdude is that little kid in florida living in his mom’s basement making a living selling crap on ebay and dreaming of owning a house in the cheapest place in the country. Byefl.
Byefl.
Mr. Oil City himself? In the house?
“life is good my friends. lobster and fine wine tonight while you have your big macs.”
Pride goeth before destruction, and an haughty spirit before a fall.
life is good my friends. lobster and fine wine tonight while you have your big macs.
That’s awesome. Casey, is that you?
True to form, this poser is spending away the home equity on things he cannot afford, like cars and fine dining. Pathetic.
I’m guessing he’s entering trolling mode. Getting a little over the top to be believable.
“Apparently, he doesn’t “own” much of anything since yesterday he said he was pulling some equity to buy a new car.”
I assumed his posts were meant as jokes, though it would be fascinating if he’s serious.
I’m going to bet a fin that azdude is that little kid in florida living in his mom’s basement making a living selling crap on ebay and dreaming of owning a house in the cheapest place in the country. Byefl.
How I picture Azdude (or Smithers)
Funny that’s how I picture the entire HBB….and you guys **SAY** your dream is to own a cheap house.
Projection much? Good lord.
How I picture Azdude (or Smithers)
Was that Bill Gates in 80’s? If not, he must be some another Sillicon Valley Tycoon.
ehh…. yeah…. I’d wager thats about Slithers speed.
Have to say that az was annoying the snot out of me until I realized (s)he’s just the anti-Housing Analyst come to amuse us with dueling memes. (Or better yet, maybe it’s another of RAL’s multiple “personas”…?)
In either case, you gotta love the dueling platitudes.
I “own” a single SFH on a decent size lot. With a lawn in serious need of rehab and poison ivy in one corner (oops).
And yet, my lack of RE mogulhood doesn’t change the fact that HA/RAL/Pimp IS rerunning the same posts today.
But is life in metro DC really worth it?
Our current top Oil City candidates: Buena Vista, Salida, Gunnison.
The thing is Oxy, we believe your situation is real, unlike the dude pretender’s.
LOL, you don’t “own” a house, you are paying for an option to buy, which you might be able to do some decades into the future.
If I don’t want to imply that I owned outright, but also want to distinguish that I don’t rent either, then I would have encased the word Own in quotation marks.
Based on the massively inflated amount you borrowed for that depreciating shack, It owns you for the rest of your life.
It is not easy speaking clearly in three letter words with the vocabulary of debt. “My House” probably comes pretty close, because it does not really imply ownership, like My Master or My Cat.
change the fact that HA/RAL/Pimp IS rerunning the same posts today ??
Just ignore him…Don’t respond to any of his posts…Thats what feeds him… Ignore him…Maybe he will go away…
Take his advice. It’s not for you anyways.
change the fact that HA/RAL/Pimp IS rerunning the same posts today ??
Just ignore him…Don’t respond to any of his posts…Thats what feeds him… Ignore him…Maybe he will go away…
Maybe he will go away? To what? To where?
This is his life. He’s not going anywhere.
To answer the squad: is life in DC worth it?
Career-wise, I’ve left the DC area a few times, and each time it didn’t go so well. So, yeah, I suppose it’s worth living in DC, for the career.
That said, Oil City is still a viable option. And it wouldn’t surprise me — AT ALL — if we see mass movement to Oil City-like places as a result of Obamacare.
Why move to Oil City? Let Oil City come to your town. I watched this happen to Buffalo half a century ago. Detroit?
Perhaps we need a word to distinguish someone who doesn’t own a house or rent one, perhaps mortgee, buyee, feckedee.
I think I would rather be dead than have to live in DC. The thought is just awful.
Yes. How terrible to live in a place with good public transportation, lots of walkable neighborhoods, intelligent neighbors and cultural and entertainment resources so vast you couldn’t take advantage of all of them if you tried. Plus retaurants and bars and clubs if that is what floats your boat. How terrible to call home a place that lots of people consider a destination worthy of their “big” vacation for the year several times in their lives. I admit, the weather in July is a little nasty, but the people keep coming.
“How terrible to call home a place that lots of people consider a destination worthy of their “big” vacation for the year several times in their lives. I admit, the weather in July is a little nasty, but the people keep coming.”
This could describe about 10 cities in Florida as well.
But the great public transportation, walkable neighborhoods and vast cultural resources are lacking.
“But the great public transportation, walkable neighborhoods and vast cultural resources are lacking.”
Meh. Cities that have “great” public transportation are cities where it costs an arm and a leg to own a car due to parking costs making car ownership prohibitive for the masses. So yeah you don’t own a car, you walk or take the bus places. That’s not exactly a selling point.
Vast cultural resources….yeah OK. But really how many times do you go to the opera or symphony or a museum? A couple of times a month on average, maybe? Less so if you have kids. Your typical 2 kid family does the same thing in DC as they do in St Louis as they do in Denver. It’s just that they pay 4X as much to do it in DC.
I did not mean to sound so harsh. I know it offers all that, Polly. It’s just not for me. I don’t like crowds, traffic, crime, and all that comes with it. I do like to visit, though. I understand how many people find it attractive. It’s just that I personally enjoy acreage with a nice, large garden and nothing but the sound of birds and wildlife. To each their own.
Your typical 2 kid family does the same thing in DC as they do in St Louis as they do in Denver. It’s just that they pay 4X as much to do it in DC.
And in Denver you get to do it without the humidity.
It seems like the same thing day after day but there are changes over time. Six months ago every day started with “Why buy now when you can buy later for 65% off?” These days we rarely hear the 65% figure but are instead treated to the Suze Orman quote. Although the repetition is nuts, think about this: if he convinces someone to put off buying a house during this bubble or even if he merely convinces someone to more aggressive on price or scale back the size of their house, he’s saved them potentially six figures of money.
It’s the same drivel day after day, constituting maybe 10% of the posts on a daily basis.
A real waste of bandwidth if you ask me.
Agreed. And the realtor driven mantra is everywhere in the media. “Housing is an investment” blah blah blah.
The truth?
“Housing is a depreciating item and a loss always.
We also have to wade through the daily drone of the “My debt will make me rich” crowd.
This board used to have much less personal attacks and more data driven discussions. HA’s repetitive attacks on posters whose opinions differ from his own has driven the overall quality of posts downward.
His posts lack substance.
Ignore them if you don’t like reading them. But make no mistake about this….. we post data. You post realtor driven misrepresentations.
Someone post the joshua tree link for ibbots to show him how to ignore me and relieve his pain.
And here’s a bulletin for you “ibbots”. I encourage you to install the joshua tree extension so as to easily ignore my posts. But I won’t be ignoring yours.
This board used to have much less personal attacks and more data driven discussions ??
Absolutely…&…Unfortunately…
This board used to have way fewer true believers in the perpetual credit expansion and the unstoppable rise in the value of debt riddled housing. I have no clue why.
The oldtimers have moved on and been replaced by blubbering idiots.
The oldtimers have moved on ??
This old timer has not (yet) in spite of posters like RAL…
Eddie was bad sometimes but he shared opinions on a number of different issues and called the 12,000 DOW right on the money when many (including me) were disagreeing…
been replaced by blubbering idiots ??
Just ignore him…
I remember when the only poster on this blog was me. And then other people came and immediately some started whining about something or other.
some started whining about something or other.
We used to get free beer. What happened to the free beer?
Six months ago every day started with
I long for the simpler days of yore when every morning one could expect to be greeted with “Realtors are LIARS” as the first post in the bucket.
But every artist must evolve I s’pose. Of course, most artists explore and then come back to their roots and first love… I mean, look at U2. They went all “Achtung Baby” but have come back in recent years to their original form.
Why does everyone dump on Achtung Baby? It was a good album.
I actually spent many hours listening to it, and enjoying it, myself. But it marked quite a shift in style for them, which was more my point.
Ahh OK. I misunderstood your intent.
If you’re looking for out-of-character albums to dump on, may I suggest Mr. Roboto (or Kilroy was Here, or whatever it was).
No accounting for taste. Every time I hear Bono’s voice my first thought is that this poor guy must be terribly constipated.
Biggvs Richardvs
LOL very funny
And when I think about the bands I liked in the 70’s…
(excluding Chicago, Moody Blues, Yes -who had a member that went on to film scores, Trevor Rabin.)
“even if he merely convinces someone to more aggressive on price or scale back the size of their house, he’s saved them potentially six figures of money.”
The sheer volume of his repetitive posts guarantees a few responses, *some* of which evolve into constructive conversation, so maybe there’s a net positive. It’s beyond me why he has Ben’s blessing to fling crass insults so freely, but there we are.
Someone asked me the other day to post job openings at my company. I’m not comfortable with putting my company name out there, but, I figured I post a few similar positions (the mythical 100K+ IT jobs) at some other companies.
http://jobs.vmware.com/job/San-Francisco-Staff-Systems-Engineer-%28Strategic-Account-Pre-sales%29-Bay-Area-Job-CA-94101/2674159/?feedId=4&utm_source=Indeed
http://www.publicisgroupe.com/#/en/career/talent/offer/filterLang/EN/id/RS00010
Here are 2 similar to our job postings. These jobs are probably “low 100’s”, maybe topping in the 120K range or so. The jobs my company posts typically requires more network certification; but we pay quite a bit more than most other employers as well.
The other guaranteed 100K job for someone in tech is to become an SE for a major manufacturer. NTAP/Cisco/VMware/EMC/etc. All of these positions are going to be “mid-100s” to “low-200s” depending on sales targets/goals and, of course, your personal success. BTW, SEs are NOT direct sales, they are engineers that work with a sales guy. No cold calling, no client management, and a much higher base (but, of course, much lower commission structure) than a sales employee.
All of these jobs, BTW, are going to involve pretty significant travel. You may be able to work up to a point where you don’t have to travel as much, but, in the beginning, you’ll probably be on the road 50%+ of the time. Also, those without people skills aren’t going to do well (or even be offered) these jobs. The “value” in these roles is that the engineers can become a trusted adviser to the customer and help shape their buying decisions to purchase one company’s “stuff” over another. If your a non-native speaker, you likely don’t have much chance at these positions except in specific markets.
Actually the one fellow from Goldman Sachs who has gone to jail is Sergey Aleynikov, the programmer who supposedly “stole code” from Goldman:
“Aleynikov held the title of Vice President in Goldman’s Equities Division for two years. He was a member of a team of computer programmers who were responsible for developing and improving portions of the code for Goldman’s high frequency trading platform. Teza approached Aleynikov and offered him the position of Executive Vice President, Platform Engineering at triple his $400,000 salary in order to develop its own high frequency trading business.”
http://tsi.brooklaw.edu/cases/united-states-v-aleynikov/reports/case-report-united-states-v-aleynikov
But, a casual perusal of of the various salary websites shows this is rather unusual. But, it can happen.
Jobs at my company will definitely pay over 100k.
We’ve been hiring like mad and continue to, and little or no travel is required (software programming, C++/Java/C#/web). As far as I can tell, the tech market here is quite tight, with the larger companies and lots of startups trying to entice folks out of their existing jobs.
My cousin makes around $200k at his IT job in Seattle. He’s been there close to 20 years. He will lose his job to H1B’s one day, though.
Not lose, his salary will come down to earth for sure.
$200K in Seattle = $85K 100 miles away from an ocean.
$200K sounds impressive but it’s really not in Seattle, SFO, NYC, DC. I mean it’s not starving by any means but it’s barely above middle class.
The trick is to make $200K but live 100 plus miles from an ocean. And a lot of people have found a way to do that given that, especially in tech, it doesn’t matter where you live. You might have to do some travel to do so, but I think overall it’s a fair trade-off and financially rewarding.
“The trick is to make $200K but live 100 plus miles from an ocean.”
Yup. Or, even better, live right next the ocean in FL for a price that’s similar to a house in flyover.
Yes, you fly a lot. But, because housing costs are so much lower, your lifestyle is dramatically better than it would be if you lived in the high cost cities.
My boss lives in San Fran in a nice (2000 sq/ft) condo. He and his wife share a Honda. They never take big vacations. They have a child and send him to a private school. They are always strapped for cash. Because their house cost 4X what mine did!
My lifestyle is dramatically better than his (if measured from the standpoint of material things), even though I probably earn 100K less than he does. 2 very overpriced cars. Far more SQ/ft and right on the intercostal waterway. 2 vacations a year..
The difference? No child. Housing costs. Pretty much that’s it; but if you looked at our lifestyles, you’d certainly think I was his boss, not the other way around.
Of course, he does get to live in San Fran.
“$200K in Seattle = $85K 100 miles away from an ocean.”
I don’t know what fantasy world you are living in, but you couldn’t be more wrong. There are many exceptionally nice rentals in Seattle available for less than $2k per month. Let’s assume $24k per year rent. Let’s assume that’s $18k per year above the “100 miles away” location, which is actually more than generous. That leaves $176k vs $79k for all other expenses (we will assume this is after tax earnings for argument’s sake). I fail to see your logic.
My lifestyle is dramatically better than his (if measured from the standpoint of material things),
I see your truuuuue colors, shining through…
“There are many exceptionally nice rentals in Seattle available for less than $2k per month”
700 sq ft 1 bedroom apartment for $2000/month
http://seattle.craigslist.org/see/apa/3895575264.html
This “exceptional” rental is $700 in 80% of the country.
Overtaxed,
I had the same WHOA experience a few years ago. I was working for a guy who lived in SF. I went there every few weeks and one time I stayed over the weekend. The “boss” had a BBQ that weekend and he invited me over. This dude was a SR Vp of something or other at a pretty big, well known company. I was expecting a mansion. He lived in a shack. A shack worth close to $1M but nonetheless, a shack. I made 1/2 what he made and like you, lived a better lifestyle (materially speaking at least) than he did.
As for “well he gets to live in SF”, great. I get to live somewhere else and see SF and Seattle and NY and LA and San Diego every few weeks on someone else’s dime.
I went to a friends house in Mountain View around 5 years back (at the height of the bubble, or near it). He was a Google employee, making big bucks (I would imagine). Anyway, his house.. Was beyond modest. Probably 1200 sq/ft (maybe 1500, I can’t remember his address to look it up). 50 years old or so. No pool. One car garage.
I looked it up on Zillow at the time, he paid something like 1.7M for it. It was walkable to downtown (whatever that’s worth). Other than that, it was a total s**tshack. Something like that, even at the time in FL, would have been <500K. Today you could pick up that house in my area for 150-200K.
Right then I realized that, no matter how bad it was in FL, it was FAR WORSE in other areas of the country.
I wish I could remember the address. I’m sure it’s down huge; but, I’m wondering if it’s still over 1M bucks. That house might fit in my neighbors garage.
No waterfront. No property. No pool. Ugh… Not trying to be a snob, but if you pay that kind of money for a house, it should be “special”.
Crazy. Just crazy.
Funny you mention Mountain View. Friend of my wife and her husband bought a house there a while back. It’s a nice house, old but renovated. And it does have a pool. I saw pictures and thought nice house and told my wife that’s at least $1.3M. She said no way you’re crazy, there’s no way THAT house is $1.3M. Impossible. She was right. It was $1.8M.
How did the couple afford it? Easy. Her family is wealthy. His family makes her family look like bums. The word on the street was their wedding cost $200K. And given where it was and home many people were there and the qualify of drinks provided, I’d say that’s probably a low estimate. I probably drank $250 worth of the good stuff myself
So affordability is obviously not an issue. I doubt they even have a mortgage on it. Man I wish I had parents that generous.
“700 sq ft 1 bedroom apartment for $2000/month”
Slithers, the cherry pickin’ daddy, is at it again.
Mr. Smithers
We have friends that get new cars all the time paid by his mother in cash. Must be nice, but trust me, the crap they have to take being on her “leash” sucks.
No thanks, those kind of favors usually have high interest rates, so to speak.
I’d take all sorts of crap from my parents in exchange for a $1.8M house free and clear.
Yes RAL/HA…my bad. I was only cherry picking. Seattle rents are actually free. Well except when it’s $4K for an apartment.
1 Bed with “spectacular view” of the building next door $2151
http://seattle.craigslist.org/see/apa/3899260793.html
1 Bed $2356
http://seattle.craigslist.org/see/apa/3899307382.html
2 Bed $3595
http://seattle.craigslist.org/see/apa/3899262335.html
2 Bedroom $2441
http://seattle.craigslist.org/est/apa/3899439690.html
2 bedrooms $2950
http://seattle.craigslist.org/see/apa/3899355516.html
2 bedrooms $4500
http://seattle.craigslist.org/see/apa/3899323753.html
Hayzoo Cristo, that’s expensive!
Better rent now before all those new Paul Allen condos come on the market in South Lake Union!
Slithers has absolutely no concept of median price.
Slithers is long known for cherry picking outliers and misrepresenting them as truth.
Why Slithers Why?
I be surprised if that turned out to be strictly true. I know a TON of people in IT in seattle and nobody’s making 200k for striaght IT work. Do you quick search on Indeed or craigslist and you’ll find out most IT jobs top out at around 70K here and many are quite a bit less.
Remember, median household income in Seattle is only 70K. That’s with many/most households being 2 earners.
If you’re friend is making 200K he’d have to be in management, and after 20 years in the same job I would certainly hope so.
The other possibility is that he works for the government and has just been getting steady salary increases / overtime. sadly, lots of leeches like that around here, especially in Olympia. this includes Boeing - they’re almost entirely taxpayer funded.
“Remember, median household income in Seattle is only 70K. That’s with many/most households being 2 earners.”
That’s kind of irrelevant to the topic at hand. Median income for high end IT workers is going to be significantly higher than median income for the population as a whole. It’s like saying median income is only $X so a doctor can’t possibly earn $500K in this area. And no obviously I’m not saying IT workers make doctor money. I’m saying some professions pay a lot even in areas where most other people don’t make much.
And yes median income may be $70K for “Seattle”. That’s a little misleading. Median income is $123K in Mercer Island, $92K for Redmond (home of MSFT), 87K in Isaaquah, $96K in Bainbridge Island. Those are the cities where $200K a year workers live, not in Seattle proper.
And one more thing…if you’re looking for an IT job on craigslist….you need some seriously better job finding skills.
What’s wrong with Craigslist? I’ve found numerous high paying gigs off there.
You’d be surprised at how many IT jobs are ONLY advertised on Craigslist. See in Seattle, we’re smart enough to have figured out that it’s just a medium, so you might as well go with the lowest cost one.
“Remember, median household income in Seattle is only 70K. That’s with many/most households being 2 earners.”
That’s kind of irrelevant to the topic at hand.
It’s entirely relevant. With 70k being the median household income, most people in Seattle aren’t paying $4K a month rent.
I pay $950 for a two bedroom 2 bath with a creek, W&D, and fireplace. Ground floor, no upstairs neighbors (2 story townhouse). I’m about 12 miles from downtown Seattle with multiple public transpo options to get to work at my Craigslist job(s).
I get emails/calls all the time from recruiters, and one reason I like Craigslist as both an employee and a hiring manager is that it lets you screen for direct hire vs. 3rd party (body shops, etc).
“I know a TON of people in IT in seattle and nobody’s making 200k for striaght IT work.”
Do you know any Cisco SEs? If so, you know people in Seattle making 200K (or very close). They might lie about it, but, they are almost certainly in that range.
200K is starting to top out for engineering talent; but, as you mentioned, once you get into management (which typically comes from the engineering ranks) you can continue to go higher.
Working directly for an employer, yes, 200K jobs are far inbetween. But, once you get into the sales side (even if you’re not direct selling, just facilitating and acting as the SME), 200K isn’t all that uncommon.
Ya, I’ve known plenty of Cisco SEs.
According to salary.com, the median salary for Sales Engineer II (Intermediate sales engineer) is only $70k and Sales Engineer I is less than $57K.
After being an SE for a couple of years, I can tell you that if Cisco is paying 200K it is by far the exception and not the rule. I base this not just on the numbers but also my own observations of the lifestyles led by your average Seattle SE(I’ve known many).
The other thing about being an SE is that it can be very unstable. All it takes is one down quarter, or get paired up with a bad sales person, and you’re on the chopping block. There was a massively high turnover rate back when I was in the SE game.
I saw some of the medium sized channel partners that went through 2-3 SEs a year in one office.
Anyone in Seattle making 200K is making 3 times median gross household and is not “just barely” above middle class.
According to salary.com, the median salary for Sales Engineer II (Intermediate sales engineer) is only $70k and Sales Engineer I is less than $57K.
LOL!!
That’s LOL for 2 things…
1. Thinking salary.com is a reliable source of information
2. Thinking an SE makes $57-70K a year. Way back in the day I worked for a software vendor. I was in professional services. I started out at $75K base, made around $100K with bonuses. I was offered moving into an SE role and while base would have been around the same, adding commission to the mix would have bumped it up another $30-50K on top of my total compensation. And this was 15 years ago. If you think 15 years later an SE is making $57-70K, you are out of your mind. On day 1 out of college an SE is making more than that. Someone with 10 years under their belt is in the $200K ballpark. I swear to god, some of you people live in an alternate universe.
I didn’t end up going to the SE role because I didn’t like the idea of lying, errr I mean selling for living.
The median salary NATIONALLY for IT managers is $120,000. That’s nationally which means for Seattle it’s $150-160K. And that’s median which means there are plenty above $200K.
http://www.bls.gov/oes/current/oes113021.htm
Mr. Smithers:
It managers are in management, not IT.
“thinking an SE makes $57-70K a year”
ROFL at this with you Smithers. I made more than that working for the government as a system admin almost 10 years ago. And, no, I didn’t have to “work my way up” to that salary; an IT job that pays <50K out of college is very rare (and, if there at all, something that you do for 3 months to get your foot in the door).
There’s no SE that I’ve ever met and discussed salary with who makes <100K. It’s a demanding job; requiring people skills and technical skills, and, it’s also (as pointed out above) somewhat unstable. A lot of your success depends on the sales team that you wind up on.
IT managers, I can believe that salary. That’s a wildly variable field, you have people managing a IT sales team making 300K. You have a guy with the title “IT manager” at a employer with 20 desktops making 50K.
“I didn’t end up going to the SE role because I didn’t like the idea of lying, errr I mean selling for living.”
Neither did I.
Engineer with good people skills? They don’t ask for much, do they?
Engineers without people skills are being outsourced to India. If you just need someone who can code, you can get them for 10/hr. If you need someone who can sit in front of a room of executives, sell a project/program/etc for millions of dollars and then make sure it’s implemented correctly/on time; that’s going to cost you a lot more.
Those aren’t engineers. Those are program managers that happen to be engineers. This is true in general. If your skill set is sitting in a cube for 8 hours a day in front of a computer, someone in China or India can do the same job for a fraction of your pay. If your job is to interact with people in some capacity, the Indian or Chinese version of you can’t compete.
And THAT….. is why I still have a good job in Seattle.
LOL…Good One lfc….
I assume by “SE” you mean Sales Engineer?
Also, the first asks for “12+” years of experience. What could one just starting out in that area expect to make?
Most of these companies won’t hire right out of college for these types of roles. You’ll need to get a regular data center job for 5 years or so to get the experience to draw upon when consulting.
If you had a few years of experience and a college degree, you could probably expect 80-100K as a starting salary at one of the big boy hardware shops (NTAP/EMC/Cisco/etc).
In that first job, get all the certs you can. CCNA, VCP, storage cert, etc. PMP is helpful too. A BS/BA in comp sci or information systems is probably the most helpful undergrad degree.
Yesterday we wondered — aye we wondered — if the banks would be bailout out again, despite the new provisions under Dodd-Frank. I guess I wasn’t the only one wondering:
Why Big Banks Are Insisting They Can Fail (Viewpoint)
By the Editors Jun 26, 2013 6:00 PM ET (bloomibergi)
“Over the past few decades, the U.S. government has allowed the failure of only one large, systemically important financial institution, Lehman Brothers Holdings Inc….
Regulators say times have changed. Their primary argument centers on a piece of the Dodd-Frank Act known as the orderly liquidation authority. The authority is supposed to give the Federal Deposit Insurance Corp. the tools it needs to wind down any financial institution with minimal collateral damage.
Problem is, there’s no way to be sure the liquidation authority would work. Some prominent policy makers go so far as to say that it perpetuates taxpayer-funded bailouts, because it authorizes the FDIC to use government funds to keep distressed institutions afloat during the liquidation process. “This looks, sounds and tastes like a taxpayer bailout, just hidden behind different language,” Dallas Federal Reserve President Richard Fisher said in congressional testimony June 26.”
—–
Interesting. So the devil is in the details. The Editors at Bloomibergi think that breaking the bank could cost as money and cause as much damage as bailing out the bank, and therefore the gov will eventually choose the bailout route anyway. And it appears that the banks are banking on that — quite literally. They’ve gone back to their low-interest derivative swapping trading ways.
Many at HBB think that the economy went to hell when the value of dollars was decoupled from gold. Maybe it’s when the value of dollars was decoupled from labor. When a UPS driver labors for a year just to bring home $50K, and a trader at a computer can lose $50K in a couple seconds with no thought that he just destroyed a UPS driver’s family, something is very wrong.
Of the 0.1%, by the 0.1%, for the 0.1%.
When the Occupy movement started in 2011, their primary “platform” of demands (before it got bogged down with a laundry list of libtard nonsense) included a transaction tax on all financial trades.
That would be totally unacceptable to the Masters Of The Universe, and therefore Occupy was crushed through a coordinated effort of mayors and Obama’s terrorist thug DHS.
I give you +1 for “libtard nonsense.”
Because it WAS libtard nonsense.
Occupy should have assembled in Zucotti Park at 8 am and left at 6 pm (with a 12-1 lunch break), Monday through Friday. Wearing suits and carrying simple signs that said “The profit motive is the cause of the loss of the middle class jobs” and “Money should be based on labor, not created by computer algorithms.” I’m not sure there would be any way to stop them.
Yup…easier AND more effective. Win/Win. The drum-circle Castro-wannabe-beard types have a pretty big blind spot regarding what will win J6P to their cause, though. It’s like they’d rather lose than appeal to the center. Kinda like the crazy right.
wannabe-beard types
Beardos.
It shouldn’t be “based” on labor, but perhaps on value created or something else.
I might spend 15 years and 10,000 man hours amassing a 30 foot ball of belly button lint. It might be a marvel of engineering and human persistence. But, it’s worth what someone is willing to pay for it, and not dependent on the time and effort I invested.
But that’s its worth to someone else. To me, it might be priceless. NTTAWT.
OTOH, you might invest 15 years and 10,000 man hours and pull 5 tons of gold out of a creek bed, but only make $500, because the 2-3 guys controlling the market got together and decided that your time was only “worth” $500.
It should be based on production.
This was the point I was making about student loans. The “rebellion”, if it comes, won’t be middle class college educated young people in the street, it will be loans going bad and more banks going bad. But will Wall Street truly get hurt? No, just the rest of the country. There is no way to be sure that any “liquidation plan” would work once the value of a whole class of assets drops precipitously. Does anyone have confidence that the lawyers writing the liquidation plans are considering the student loan bubble? Doubtful. They’re focusing on legal obligations and laws without considering that these would likely be suspended (again) if a mess really needed to be contained.
just as if i were an illegal immigrant at the starting blocks of the u.s. / mexican border assuming amnesty when i arrive; i am a recent high schoold graduate beginning my studies in basket weaving with mountains of debt that i expect i will not have to repay.
moral hazard is a bitch…in all respects.
Some form of student loan forgiveness or assistance is baked in the cake…just like HARP, HAMP, HAFA etc.
The real problem was the middlemen ripping off BOTH the government and the students. They knew exactly what they were doing, they are continuing to do it, it will end badly, and the government and the public will end up worse off for it. Bankers will never lose in this context.
I find it quite a coincidence that politicians are frequently oblivious to policies and people who won’t line their pockets.
If you want a case study in surreptitious corruption, I have to point out, with some regret, the story of Bob McDonnell, the Virginia governor. The link below lists how his family received big money from a company. It was recently revealed that he was given a 6500 dollar Rolex by another businessman.
http://maddowblog.msnbc.com/_news/2013/06/25/19132629-troubles-worsen-for-virginias-bob-mcdonnell
But… that’s how the system works. Give to a PAC, give to family members, or some other shell entity which benefits the politician, and it’s all legal. And the politicians created this system.
“Government of the highest bidder, by the highest bidder, for the highest bidder.”
It’s a good thing no Democrats ever do this. They’re as pure as the driven snow.
The news just announced Syracuse has been designated a drone testing area. The drones will be tested for commercial uses more than military uses, read the newscaster.
Is it getting hot in here? Ribbit.
Commercial drones? They hover in front of you and play witty ads?
They deliver your pizza.
Wall Street Journal headline: CIA to Arm Syrian Rebels Within a Month
Expect nothing less from the Nobel Peace Prize President
Hope and Change
“I continue to be concerned about the other documents he may have,” Mr. Obama said … “He has those documents. He’s released some of them but not all of them have been released.”
What else could the “most transparent administration in history” have to hide?
Forward
http://www.cbsnews.com/8301-202_162-57591281/obama-concerned-edward-snowden-could-leak-more/
Second Nobel peace prize guaranteed.
you’re thinking only about the lives that will be taken…not saved.
it’s a common since approach…you know…just to make sure everyone gets a fair shot…pun intended.
Ya gotta wonder at this point about the decision to outsource high security national intelligence to an army of highly-paid contractors, many of whom never even completed college, instead of keeping it within the ranks of the full-time federal work force.
Definitely, the contractors are too highly-paid, but the feds are union goons who collect $250K pensions at age 52 and contribute to the nations CURSHING DEBT.
Let’s outsource the whole shebang to Mumbai. Or at the very least, move the operations to a right-to-work state.
Is the flight-from-quality panic over by now?
Has Gold Entered a Long Term Bear Market?
Published: Wednesday, 26 Jun 2013 | 11:12 PM ET
By: Ansuya Harjani | Writer, CNBC Asia
Gold, which is trading at its lowest level in nearly 3 years, is in the midst of a long term bear market, and investors should look for an opportunity to exit positions in the precious metal, experts told CNBC.
“It’s a long term bear market. If you bought into it today, don’t expect it’s going to do much. And if you own some and get a rally, get rid of it,” said Dennis Gartman, editor of The Gartman Letter, a daily commentary on financial markets.
The precious metal plunged 4 percent late Wednesday, trading as low as $1,221.80 an ounce, as the rally in U.S. equities dampened demand for bullion as protection against economic uncertainty. Gold has fallen 23 percent in the second quarter and is currently on track for a record quarterly loss.
(Read More: Gartman: Three Reasons Why Gold Is Going Lower)
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trading as low as $1,221.80 an ounce,
Wow, I’m finally feeling a bit better about selling all of my gold when it hit $1250 three years back; seemed a bit frothy at the time.
Yeah, I do seem to be a bit early at exiting these bubbles…
Didn’t it hit $1900 or so before the onset of the crash? I’d say you were cautious but quite early. And it’s to your credit that you are not underwater on your purchases now, like most who bought after the point when you sold are currently.
This gets to one of the key aspects of bubbles, which is that once most of the better-informed players realize we are in one, nobody can begin to guess how much prices will go before the crash finally hits.
I bought at $600 and sold at $900. I missed the entire huge run-up. But I am still happy about making any profit.
The best advice I give about investing (in anything) is don’t feel pressured to buy for fear of missing out. And don’t look back at any investment you didn’t make and feel bad about it. Because there is always another opportunity coming along. You may have missed the last bus, but you’ll catch the next one.
Gold explorer says metal is still precious
AAP June 27, 2013, 4:12 pm
The price of gold is at three-year lows, but a Joseph Gutnick-backed gold exploration company insists the commodity hasn’t lost its lustre.
Mr Gutnick’s private company Great Central Gold signed a $13 million funding agreement with West Australian gold explorer Blackham Resources in February, resulting in the Melbourne-based entrepreneur taking on the role of chairman.
Four months after the deal, the precious metal continues to be punished on global markets.
While Blackham shares have halved in price in recent months to hit four-year lows, managing director Bryan Dixon has urged investors not to panic.
“Gold has not lost its lustre, markets are now in fear mode,” Mr Dixon told a mining lunch in Perth.
“There has been almost a capitulation in the gold market.”
Gold’s properties were still the same and the commodity was still very valuable at today’s gold price, he said.
The spot price of gold in local trade was $US1,239.43 on Thursday.
“If you’ve got a good gold deposit you’ll make money at that price,” Mr Dixon said.
…
I havent seen any panic yet. Is the DOW supposed to go straight up now?
Don’t Panic as Bond Market Ship Not Sinking, Pimco’s Gross Says
By Grant Clark & Rocky Swift - Jun 26, 2013 8:04 PM PT
Bond yields and risk spreads were too low two months ago and global markets that were too leveraged are now reducing risk, according to Bill Gross, manager of the world’s largest mutual fund at Pacific Investment Management Co.
Gross’s $285 billion Pimco Total Return Fund (PTTRX) led declines among the most-popular bond mutual funds earlier this month after the Federal Reserve sparked a global selloff in bonds by indicating it may start reducing asset purchases known as quantitative easing, or QE.
“In trying to be specific about which conditions would prompt a tapering of QE, the Fed tilted overrisked investors to one side of an overloaded and overlevered boat,” Gross said in his July commentary titled “The Tipping Point”, posted on Newport Beach, California-based Pimco’s website. “Don’t panic,” he wrote.
…
Yes, just like RE. How much RE do you owe(n)? An interest rate can always be refinanced throughout the life of the loan, but a shitty price is forever. Prove me wrong. Show me how rich and powerful you are. Confound me with your amassed wealth. Show me some of your properties and how much they have appreciated. I am on the fence. Convince me to buy now. Show me that you are more than just another f@cked buyer, wallowing in your misery and longing for company so that you won’t feel quite as hopeless and bitter as you sound.
Magic iPhone Live Quote says…. “Yes.”
POMO day today.
How to Handle the Bond-Market Collapse
by Dan Caplinger Jun 27th 2013 5:00AM
Most investors believe that the major source of risk in their investment portfolio comes from stocks. But as millions of people are about to find out as they open their quarterly statements early next month, the usually sleepy world of bonds has been a lot riskier recently.
Worried investors increasingly want to know what they should do about the surprising losses from the supposedly “safe” portion of their portfolios.
Traditionally, investors allocate their money between stocks and bonds. Stocks have more growth potential, as their value is tied to the fundamental prospects of a company’s business. As earnings grow, so too do share prices, at least over long periods of time.
By contrast, bonds represent IOUs from companies to investors, with bondholders entitled only to repayment of their principal when the bond matures. That puts an upper limit on the amount of price appreciation bonds can enjoy.
Why Are Bonds Falling?
Bond prices are tied to interest rates, with rising rates causing the value of existing bonds to fall. In a rising interest rate market, investors can purchase new bonds that offer more income, so buyers aren’t willing to pay as much as they did when prevailing market rates were lower. Falling prices in turn make a bond’s yield rise, bringing it in line with interest rates in the market.
For example: if a one-year bond paying 2 percent sees its price fall from $1,000 to $990, then its yield rises to about 3 percent — the 2 percent from the income the bond pays, plus the 1 percent difference between its current price of $990 and the $1,000 that the bondholder will get at maturity.
Interest rates spiked recently because the Federal Reserve suggested that it would slow down its bond-buying program. With the Fed having bought bonds at a pace of more than $1 trillion per year, supply and demand kept bond prices high and interest rates low. Investors are afraid that a slowdown in Fed buying will reverse that trend, and so they’ve sold off their bonds, helping send prices lower.
To understand just how hard the bond market has been hit, the same 30-year bond that the U.S. Treasury auctioned off back in February for just under $990 has seen its value drop to less than $923, an almost 7 percent drop. Even worse, an inflation-adjusted Treasury bond that sold for $995 at auction four months ago is now available for less than $810, a decrease of about 19 percent. Losses of that magnitude are unusual even for the stock market, let alone bonds.
…
The myth that holding individual bonds is somehow vastly different (and superior) to owning shares of a bond mutual fund seems to show up in print often these days. Call me skeptical if you want, but I don’t see who wrapping up the same type of investment into a portfolio and selling it off to individuals can drastically change the performance of said portfolio.
Mike Patton, Contributor
6/26/2013 @ 1:55PM
How Will Bonds Fare As Interest Rates Rise?
When panic struck in 2008 investors sold stocks and rushed into bonds with great exuberance. Over the past five years this extreme cash influx has pushed bond prices higher and yields lower. However, when investors began to sell stocks recently, if the proceeds would have flowed into bonds, then one might have expected bond prices would have risen and yields would have fallen, or at least remained low. In reality, this has not been the case as we have witnessed one of the sharpest and quickest increases in bond yields in decades. Therefore, if you are invested in bonds your concern should be the degree to which bond values will fall if interest rates continue their ascent. In this article, we will address this very important point.
Over the past 30 years bonds have been in a bull market. This is partly because in October 1981 the U.S. 10 Year Treasury peaked at over 15% and has been on a steady decline since then. To explain, let’s assume you invested $10,000 in a 15%, 30 year bond back then. By midyear 1995 rates had fallen to around 6%. Because bonds have a market value like other investments investors interested in buying your bond would have paid a higher price because it offered a superior yield. Hence, if interest rates decline after you purchase a bond, generally speaking, the value of your “higher yielding” bond would rise. Of course, the reverse is also true.
There is a significant difference between an individual bond and a bond mutual fund. A difference that in a period of sharply rising interest rates can cost you plenty. Now let’s turn our attention to bond mutual funds.
Bond Mutual Funds
A bond mutual fund is a packaged product which holds multiple individual bonds. Each of these bonds has a coupon payment which determines the amount of interest paid and is a percentage of the face value of the bond. Each bond also has a market value based on the specific issue and the prevailing interest rate environment. There are other factors which affect its value, but to keep things simple, we’ll leave it at that. Mutual fund managers have had the luxury of investing in relatively high yielding bonds at least until 2008. However, because interest rates have been so low for so long, as the higher yielding bonds mature, managers must reinvest the proceeds in today’s lower yielding issues. Eventually, as more and more higher yielding bonds mature, and are replaced by lower yielding issues, the prospects of attractive future bond returns is low. To compound the problem, as investors exit bond mutual funds, managers must have enough cash on hand to meet these redemption requests. In short, future bond fund returns will be much lower than in the past.
There is another important issue worth mentioning and that’s the maturity of bonds. The longer the bonds maturity, the more pain investors will feel as interest rates rise. Therefore, to minimize this pain, investors can buy shorter term issues. However, with the Fed holding down the short end of the interest rate curve, there’s very little yield to be found there. Basically, bonds are quickly losing their appeal. But there’s a slightly different story to tell when it comes to individual issues.
Individual Bonds
Investors who buy individual bonds have less to worry about in many respects than those in bond mutual funds.
…
A couple of points about the recent turmoil in the bonds and precious metals markets are worth bearing in mind:
1) The spike in long-term interest rates since May 2nd which has led to selloffs in gold and dollar-denominated long-term bonds is expected to have a similar effect on U.S. residential real estate prices.
2) Unlike bonds and gold, which are traded on centralized exchanges with prices posted every few minutes, home sales are decentralized transactions, whose sale prices don’t show up in price indexes such as Case-Shiller/S&P until several months after sale.
In short, the housing price statistics several months down the road from now could get very interesting!
I guess all those gold bugs kind of got hosed didnt they? Too many peter schiff kool aid drinks?
It would only appear so to a debt donkey. The Big Hosing is for those who think the value of their debt laden house is going to go up while the dollar is going up and interest rates are going up.
The spike in long-term interest rates since May 2nd ??
Its still 4% money…Still at historic lows….
And housing prices are still massively inflated at historic bubble era highs.
That’s right. All we have seen so far is the warmup act. The real panic won’t ensue until the Fed starts to actually exit from QE3 late next year.
Yep…Thats when the real action will begin….
Sincere question: would this drop house prices/bond only to the level they were just before the QE began? Or are you looking for a Depression-style bottom with some permanence?
Fed starts to actually exit from QE3 late next year.
I don’t think they will ever exit. Taper yes, exit no.
Sincere question: would this drop house prices/bond only to the level they were just before the QE began? Or are you looking for a Depression-style bottom with some permanence?
Nothing is permanent. But what I’m looking for is the same as what would have happened if there had been no FASB 157 and no QE. Or even worse with all the horrible decisions that have been made since then. I suspect you would call it a Depression. But I understand we will put it off as long as possible, or at least until the cost has been completely transferred away from the right people. So perhaps there will be more iterations of what we’ve seen for the last 4 years before it totally implodes.
would this drop house prices/bond only to the level they were just before the QE began? Or are you looking for a Depression-style bottom with some permanence ??
I think TAX reform will have as much or more negative impact then somewhat higher interest rates…And, tax reform is coming at us like a freight train IMO…
Now, you couple tax reform and significantly higher interest rates and its a complete “Game-Changer”…
“Or are you looking for a Depression-style bottom with some permanence?”
I’m hoping we won’t see anything depression-style, but it seems like it’s baked in. Massive expansion of credit for speculation, bad debts everywhere you look, massive government and household debt levels. I just don’t see what besides a deflationary spiral can flush away all this shtuff. As always, timing is hard to predict.
House prices will end up pretty low for awhile, but most people won’t care.
“Or are you looking for a Depression-style bottom with some permanence?”
No way. We have already seen the government step in to backstop housing prices, and it is clear that the Fed has a bottomless printing press technology to facilitate the backstopping as needed with QE4, QE5, QE6, … .
Zimbabwe had a bottomless printing press too…..
Its still 4% money…Still at historic lows….
+1. It’s quite entertaining listening to them screaming bloody murder that rates have gone from ~3.75% to 4.46%.
“+1. It’s quite entertaining listening to them screaming bloody murder that rates have gone from ~3.75% to 4.46%.”
And forget the fact that 5 years ago it was 5%.
5 years ago? My rate in May 2011 was over 5% (jumbo, but still only a shade over 5%).
It appears gold will go to the bottom. I don’t know why the Fed (one of the largest gold holders) just doesn’t sell its gold and cash in while they can?
The Fed makes its living loaning $, which it makes up out of thin air. They would sell physical for what purpose?
Well the Bank of England did under Blair/Brown.
Yes, but did it change the situation in Britian in any practical way?
“They would sell physical for what purpose?”
To discourage the perception of physical gold as a viable alternative currency?
Mortgage rates soar to 4.46% - biggest jump in 26 years
By Les Christie @CNNMoney June 27, 2013: 11:21 AM ET
NEW YORK (CNNMoney)
Rising interest rates have hit mortgages big time.
Rates on 30-year, fixed-rate home loans spiked 0.53 percentage points to an average of 4.46% this week — the largest weekly increase in more than 26 years, mortgage giant Freddie Mac said Thursday.
The 30-year loan, which stood at 3.35% as recently as early May, is at its highest level since July 2011.
Rates for 15-year loans, popular with homeowners refinancing their mortgages, jumped 0.46 percentage points to 3.5%.
An extra percentage point will cost homebuyers with 30-year, fixed-rate mortgages $56 more a month for every $100,000 they borrow.
“If sustained, the rate increase will take some of the steam out of the housing market,” said Mark Zandi, chief economist at Moody’s Analytics.
The sudden jump in rates is driven by uncertainty over whether the Federal Reserve’s economic stimulus program, called quantitative easing, will continue, according to Keith Gumbinger of HSH.com, a mortgage information provider.
“The aftermath of the Fed meeting and Mr. Bernanke’s remarks … about the future of QE continue to roil markets,” Gumbinger said.
…
6 gut checks before the stock market’s opening bell
June 27, 2013, 7:23 AM
By Shawn Langlois
Good morning.
U.S. stocks are back in rally mode for the time being — nothing inspires like a downward revision to the GDP, apparently. While there’s a calm settling over equity markets, hammers are still raining down in precious metals and fixed income. As we’ve come to expect, gold bugs are out in force being “constructive.” Hey, there’s Frank Holmes on CNBC right now, touting the stuff. It could be worse; at least it’s not 1976. Yet. (More on that below).
Not to be outdone, the bond guys are doing their best to ease fears. Pimco’s Bill Gross is slinging some nautical metaphors in our call of the day: “Should you as a bond investor jump overboard and risk the cold money market Atlantic Ocean at near zero degrees? We don’t think so.” As for stocks, volume has picked up lately, particularly on the down days, which tells us investors have more conviction in the market when it’s moving lower. Not the most bullish of indicators.
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nothing inspires like a downward revision to the GDP, apparently.
Sarcasm rules.
My company stock up by $0.99, about $7100 gain for me. Still $1.12 below my sell price. My stock up, gold down, sounds like a good deal if I hit my limit and use gains to buy out-of-favor gold…over a period of several months.
J.J. Zhang’s Winner Take All Archives
June 25, 2013, 12:01 a.m. EDT
Holding bonds today is a disaster in the making
Commentary: Bond bull is over and your options aren’t pretty
By J.J. Zhang
Allocating a significant portion of your assets to bonds, particularly U.S. Treasurys, and other stable income-based assets is one of the cornerstones of modern investing and portfolio practices.
For instance, a common rule of thumb for percentage of equity exposure is either 100 or 120 minus your age, with the balance being bonds. This means young investors just starting out should allocate 10-30% to bonds while those close to retirement are at 60-70%.
A collection of United States debt certificates.
There are reasons and times when bonds are a good idea and essential for balancing equity risks, but that time is not today. The 30-year bull market in bonds is almost over, if not already, and holding run-of-the-mill bonds today, particularly U.S. Treasurys, is a potential disaster in the making.
In theory, bonds are very stable (barring bankruptcy), you pay a fixed par amount, you get regular interest payments and you eventually get your principle back at the end. While you may not earn much on the interest, you’re guaranteed never to lose what you put in as the principle is repaid, again barring bankruptcy.
While this is true, this is not what normally happens for small investors today.
…
happens every year why would it be different this time ?
At a 6% weekly rate of decline, gold loses half its value in 12 weeks (3 months), 75% of its value in 24 weeks (under 6 months) and 94% of its value in 48 weeks (11 months).
But not to worry, as the recent rate of decline can’t possibly continue for long.
Metals Stocks Archives
June 28, 2013, 1:57 a.m. EDT
Gold barrels toward steep June, quarterly declines
By Carla Mozee, MarketWatch
LOS ANGELES (MarketWatch) — Gold prices fell in electronic trade Friday, with the precious metal set for sharp, double-digit losses for both the month and the quarter.
Gold for August delivery (GCQ3 -0.69%) gave up $10.50, or 0.9%, to trade at $1,200.30 an ounce, after having hit an intraday low of $1,179.40.
Gold prices remained on a downward spiral Thursday, even as three Federal Reserve officials suggested the markets had overreacted after Fed Chairman Ben Bernanke’s remarks last week that the central bank may start slowing the pace of stimulus as early as this year.
Such a move would be based on improvement in the economy that’s in line with the Fed’s forecasts, Bernanke had said.
Speculation that the end of Fed stimulus would arrive sooner rather than later hit gold futures hard this month, as so-called quantitative easing has been credited for supporting a rally in gold in recent years.
“Gold needs either inflation or fiat-currency fears to do really well, and neither appears likely in the near term,” wrote Jay Pelosky, principal at J2Z Advisory, in a report about financial market trends for Itaú BBA.
“Having some gold in the portfolio when rates are low seems like low-cost protection, though price action is scary,” Pelosky said.
Some analysts have reported that physical demand for gold remains strong, but futures prices have continued to suffer, with the benchmark gold contract sliding 13.7% in June, and tumbling 24.8% over the second quarter.
Gold was also on track for a weekly fall of more than 6%, building on last week’s decline of 6.9%.
…
Well I posted a few months ago about my quest to buy a home in central Florida.
Here’s the three I was watching - one REO and two trad sales:
Home #1 (REO): Asking 175k, offered 168k, $105/sqft (way over the avg for the area but I liked it). Asked to increase offer (and declined). Rejected and went pending to another sucker who offered more. 70+ days and still no close, waiting for it to fall out of escrow.
Home #2 (Trad): Owner was down about 30k from their previous ask, 180+ DOM, home went pending before I could get an offer. Deal cancelled, house off market, trying unsuccessfully now to rent it.
Home #3 (Trad): Another went pending, but deal fell through and back on market.
At this point I’ve said screw it. Nothing appears to be moving except for asking prices going up.
brother Jimmy, #1 is still pending, #2 is off the market, but why not follow through with #3?
Sorry, I meant #3 is off market. they were supposedly “motivated sellers” who wanted asking price or darn near it. Both neighboring houses were junky - car under tarp and lots of clutter in the other. I would have bought it for 30k less than asking (130 vs 160k) but alas, no dice. Never mind its a 1981 house with everything original, including the appliances.
Let me add, prices here are well below bubble prices, interest rates are low, but in reality prices are barely in line with incomes and demographics. what the hell am I missing?
“Barely in line”
Doesn’t that still mean in line? Surely there’s more than 3 houses you would like to buy and qualify for, you’re not giving up this quickly, are you? Realtors often don’t work hard enough, make him/her show you 100 more houses and write offers on 30.
Barely in line means the avg buyer can barely make the payments at 3.5% mortgage with 3.5% down.
and yes, I’ve given up for now. Of the 30 Homes in the same area as #1, 3 are currently empty (bank owned but not on market) and one is in the foreclosure process.
why would I be in a rush?
I know quite a few people. And I can’t say that any of them are in a rush to buy a house.
Hey slim, yes I would love to buy a house. However I don’t want to be a “debt donkey” and get stuck. That means it’s going to be something I can easily afford and get for a good deal, not profit going to some flipper and I’m not going to get into any bidding wars against people using FHA 3.5% down loans.
Bro Jimmy
The FHA over-bidders were in our bidding war. Being cash we held our ground, knowing the condition issues and got the deal. Used inspectors to bring down our price while we were locked in. Our broker got us a decent hair cut, and in turn, he’ll get referrals.
Those FHA buyers better hope the house passes inspection. I don’t know your area’s inventory, but take some risk if it’s a long term home.
Contact Owner #2 directly and offer them $45k+ off “their previous ask.” Deal direct, get an RE attorney who can help with forms, etc, etc.
Assuming, of course, that you still care. It sounds, however, like you don’t.
Google News headline - Rev. Jesse Jackson: Paula Deen can be ‘redeemed’
Redeemed how? With a fat “donation” to the Media/Academia Race Hustlers Industrial Complex?
http://www.jessejackson.org/
Don’t Obama voters get at least one free pass?
No, with a slice of fried cheesecake. I do feel that she is being burned at the stake on this one, but I also think she should have made enough money by now to be just fine.
Hope and Change
“In India, H-1B visas have become synonymous with the IT boom of the past two decades; for IT engineers here, they are seen as a key to career growth, social prestige and good salaries.
It fills the parents with pride to say my son or daughter is in the U.S. It enhances their social respectability … The dollar salary they earn is sent back to buy farmland, new homes and pay off loans.”
Forward
“bipartisan legislation would increase the annual cap on the visas from 65,000 to 110,000, with the possibility of up to 180,000 per year, depending on demand and the U.S. unemployment level.”
http://www.washingtonpost.com/world/asia_pacific/for-indian-engineers-h-1b-visa-is-key-to-career-growth/2013/06/27/df2085d0-d8dd-11e2-b418-9dfa095e125d_story.html
So they’re outsourcing the American Dream as well. Meanwhile in the US, the hobo army keeps growing.
Political class truly hates American workers. Not sure why the americans still go to the polls?
Battered spouse syndrome.
Simple solution. Vote third party. If enough of us do it, we can win.
If your first reaction to the above statement is “yeah but they’ll never win,” then YOU are at the root of the problem of our political system.
VIVA OBAMA!!
SI SE PUEDE!!
What’s the Hindi version of that?
SI SE PUEDE
VIVA OBAMA!!
30 million new lifetime Democrat voters via Gang of 8
180K new lifetime Democrat voters via H1-B every year…and don’t kid yourself there is nothing temporary about H1-B workers. Once they’re here, they stay here and eventually get green cards and citizenship…and most importantly vote Democrat.
But I know, I know, Democrats are looking out for the little guy and stuff.
“Why buy at house at these massively inflated asking prices when everyone knows you’ll get ripped off? Rent for half the monthly cost and buy later after prices crater for 65% less.”
that was very true in 2006
And if you’re patient wise enough, 75% lower.
in the meantime make some money player.This could take years to play out.
Waiting 18 months to avoid irrecoverable losses in the hundreds of thousands of dollars?
Everyone is doing it.
Oh wow, an actual time period. 65%-75% decline in home prices, 18 months from now. OK, I just put it on my calendar for late December 2014. I’ll make sure to follow up and re-post this prediction when that time comes.
Hey Krusty….
How about you tell us about your current construction project you’re managing?
I don’t have any construction projects, I’m not good at real estate matters.
What I do want to see is who is closer to the truth in December 2014: You, saying prices will be 65%-75% lower by then, or me, who says prices at that time will be within 10%, either higher/lower than they are now.
Meanwhile, those would like to buy but are convinced by you not to do so, watch as the decades pass.
“I’m not good at real estate matters.”
Clearly.
So sit back and don’t make any more financial mistakes like you’ve made in the past.
I’ll put 1000 bucks on perkonkrusts being closer to correct than Housing Analyst.
Median home price (entire US) as of May 2013 is 208K. HA’s prediction (65% down) would have median home price at 72,800 by December 2014.
Perkonkrusts prediction is for median home price in Dec 2014 to be between 228,800 and 187,200.
Anybody willing to take this bet?
HA, you’ll have a lot more credibility if you actually post some statistics/numbers/reasoning, not just blindly state that prices are going to fall 65% from some arbitrary number (that changes every single month, and yet, somehow, the number is always still 65%).
http://ycharts.com/indicators/sales_price_of_existing_homes
I post it every day brother but it’s kryptonite to the SuperDonkeys and SuperJunkies.
$55/sq foot for new construction puts a 20 year old depreciating down down somewhere near say….$34/sq ft.
I have so much money left over after “throwing money away on rent” every month that I don’t know where to throw it.
And the Mr. Money Mustache blog kicks @ss.
Description on Amazon for the book Men on Strike.
I’m not presenting this book to stir up an HBB gender war.
Instead I’d like to offer this phenomenon as another chipping away in the number of entry level housing buyers entering what used to be the housing upgrade conveyor belt. So we’ve got boomers downsizing housing or even beginning to shrink in numbers entering senior housing, moving in with their children for care or passing away. Meanwhile the numbers of youth that represent the next wave are increasingly not interested in the old paradigm. Even without the financing debacle and bubble pricing, housing ownership is going to be facing deterioration at both ends due to cultural changes.
American society has become anti-male. Men are sensing the backlash and are consciously and unconsciously going “on strike.” They are dropping out of college, leaving the workforce and avoiding marriage and fatherhood at alarming rates. The trend is so pronounced that a number of books have been written about this “man-child” phenomenon, concluding that men have taken a vacation from responsibility simply because they can. But why should men participate in a system that seems to be increasingly stacked against them?
As Men on Strike demonstrates, men aren’t dropping out because they are stuck in arrested development. They are instead acting rationally in response to the lack of incentives society offers them to be responsible fathers, husbands and providers. In addition, men are going on strike, either consciously or unconsciously, because they do not want to be injured by the myriad of laws, attitudes and hostility against them for the crime of happening to be male in the twenty-first century. Men are starting to fight back against the backlash. Men on Strike explains their battle cry.
Most of these men are “on strike” because we lost all our manufacturing jobs.
Not to mention construction and other hands-on jobs.
Don’t forget that a whole class of white-collar jobs went overseas too. Imagine Ward Cleaver training his low-cost replacement.
Factoid: just looked up the Beavers on Wiki. Guess what Ward Cleaver majored in in college? Philosophy.
We would get married tomorrow if we could find a squadette that is 100% resolved to not breed child creatures and who does not want to be a mortgage slave debt donkey.
DINKs rule, breeders drool.
Two words: Secret vasectomy.
Or a cougar in 50’s.
We have this banner ad frequently on HBB:
http://cougarlife.com/
Goon, for goodness sake, if you don’t want kids, don’t have them, they’re a thousand tons of work and inconvenience. I think there’s an alarm on my back that goes off when it hits the couch. As soon as it does, the kids want me to get them drinks or do stuff with them, or look at them. The youngest is now potty trained, can buckle herself, pedal a bike, and pump herself on the swing, so I’m finally beginning to see the light at the end of the tunnel.
Snowgirl, I don’t know, most of the guys around me in the neighborhood and at work are “responsible fathers, husbands and providers”, not much different from my dad’s generation. Younger men are maybe waiting a little longer to be those things, but that’s cool, they should wait til they think they’re ready. I don’t know anybody hostile to me just because I’m a man, or maybe I just don’t see it. Thanks for taking up for us, though.
Clearly you’ve never had to deal with the family court system in WA, with a vindictive shrew doing everything she can to screw you from seeing your kids, ruin your relationship with them, and make you pay for both your and HER lawyers to do it to you.
Count yourself lucky.
I haven’t personally been there, but I have seen the results of it from plenty of other men I know. not pretty.
Everyone loses in a divorce. The women and children lose more.
Interesting…Nice post snowgirl…I will look up the reviews on this book…
It’s not that men are on strikes…it’s just that women don’t need men as they used to. In all honesty it’s bad for the debt based centrally planned economy, but who cares.
Ironically, massive amount debts incurred in their 20’s is also keeping men and women apart.
You rip what you sow mofos!
The deluge if bride magazine, bride TV shows and bridal stores suggests that women aren’t that independent.
And when I talk to young guys, they tell me they have no incentive to get married. Young ladies are more than happy to play house with them and if they don’t want to shack up they now have friends with benefits and booty calls. And they know that saying “I do” sets them up to get stuck paying alimony and child support on their lucky ducky wages.
^^ This is how I would explain this situation as well.
Hate to tell them, but in some locales, “shacking up” for “x” period of time is considered a civil union.
Another little nuance……..if you are shacking up, get in a fight with your significant other, and he/she accuses you of hitting them, it’s considered “domestic violence”, including all of the stacked deck that comes with it (mandatory arrest, mandatory jail time, counseling, wife-beater stigma, etc.)
If you aren’t living there, all they can charge you with is assault. You might even be able to walk away with nothing but a ticket.
The cops are spring-loaded to haul SOMEONE (usually the guy) off to jail in reported domestic violence cases……if they use their judgement, and give the accused the benefit of the doubt, they are setting themselves and their department up for a giant lawsuit.
Signed,
Hangar Lawyer
I was under the impression that common law marriage had been swept into the dustbin of history.
The -fixr was invited last week to be part* of the #2 daughter’s “entourage” to pick out a wedding dress.
* = The part carrying the debit card/checkbook.
Which is why I don’t buy the whole “Girls don’t need/want guys” BS. Ever notice that there are no groom magazines, tv shows or superstores?
+1 Colorado…Spot on…
Child support of your biological child has nothing to do with saying “I do.”
There is some implication if the child is not your biological child and you are married to the mother, but that can be resoved if you address the issue early enough.
You need to check out some of the cases where the non-biological father gets to pay child support of kids he didn’t adopt..
Why? Because the courts decided that the interests of the kids trump the interests of the father. So the shmuck gets to cough up child support for 10-15 years.
You need to check out some of the cases where the non-biological father gets to pay child support of kids he didn’t adopt..Why? Because the courts decided that the interests of the kids trump the interests of the father. So the shmuck gets to cough up child support for 10-15 years.
++++++++++
And women with kids wonder why no man wants anything to do with them….it’s truly a mystery.
So the shmuck gets to cough up child support for 10-15 years.
While the real father lives it up.
BINGO! Although in fairness, it is pretty fun being that other guy living it up….
Liberals have told women for decades that
a) having kids gets in the way of a career. You want to make partner don’t you? Can’t do that with a baby.
b) abortions are way cooler than kids (Obama called having a child a punishment)
c) marriage = slavery
Today, women live alone, are childless and work 60 hour weeks. We’ve achieved liberal nirvana. And yet somehow this is all the fault of men? Yeah, that makes sense.
Liberals have said no such thing. They were the ones pushing for flex time, equal pay, mother’s rooms, paid maternity leave, and the like.
“You want to make partner don’t you” sounds suspiciously like an old white male conservative boss.
“They were the ones pushing for flex time, equal pay, mother’s rooms, paid maternity leave, and the like.”
Yes, because the reason women aren’t getting married or having kids is because they don’t have mother rooms. It’s a national emergency.
Most of the men who are on strike are not the sort of men I’d want marrying my daughters anyway. There was, and is, a shortage that is somewhat greater than the share of women worth marrying.
What may be true is that men worth marrying, because they are kind and responsible, get a lot less love in popular culture these days than self serving jerks who are primarily concerned with themselves. That is a change when the responsible family man was thought of as a hero and bling bling guys like Huge Hefner were thought of a bums.
Then again, men heavily influenced by popular culture were never worth marrying to begin with.
The whole “love-marriage” thing is a giant scam/conspiracy, much like the “they aren’t making any more land” propaganda.
No better tool to keep the wretched refuse tied into serfdom.
What may be true is that men worth marrying, because they are kind and responsible, get a lot less love in popular culture these days than self serving jerks who are primarily concerned with themselves.
Ever heard of “Nice Guy Syndrome” and the “Friend Zone”? It’s not just the popular culture that doesn’t love them. Apparently the ladies aren’t too crazy about nice guys either.
Apparently the ladies aren’t too crazy about nice guys either.
One of my neighbors is smitten with her very nice husband. It’s fun to be around the two of them.
One of my neighbors is smitten with her very nice husband.
Then she is one of the smart ones.
FWIW, I know more than a few “nice guys”. They aren’t ugly or weird and they have good paying jobs, yet they are always stuck in the Friend Zone and they are very frustrated.
“FWIW, I know more than a few “nice guys”. They aren’t ugly or weird and they have good paying jobs, yet they are always stuck in the Friend Zone and they are very frustrated.”
Dudes in the friend zone all have one thing in common….no confidence / self-esteem. Money, looks, non-weirdness, sure it’s nice to have all that. But an “I’m going to get what I want and nothing’s gonna get in my way” attitude is worth 10X as much as a good paying job in that department.
Dudes in the friend zone all have one thing in common….no confidence / self-esteem. Money, looks, non-weirdness, sure it’s nice to have all that. But an “I’m going to get what I want and nothing’s gonna get in my way” attitude is worth 10X as much as a good paying job in that department.
I’d like to hear from the women about this. Does confidence and high self-esteem lose its appeal to women as they grow older and wiser?
What some may call “confidence” and “high self-esteem” often come off as “misplaced arrogance” and “general assholery” to all but the one who considers himself such. A woman mercenary/dull-witted enough to marry such as Mr. Smithers, probably deserves him. (Though if she has anything on the ball at all, I doubt she’ll be there with him in the long term.)
As for older women, I can only speak for myself, but in my general experience, the older men get, the more delusional they become about their worth to society. Self-possession and self-knowledge are far more desirable traits to cultivate. (And a fine sense of humor. Always that.)
Tom Leykis saw this coming a mile away.
“…hostility against them for the crime of happening to be male in the twenty-first century.”
Wow they sure hit that one on the head as any man who has dealt with the Family court system in WA state can attest. Or how about the guy in Virginia, apparently not an isolated case, who was jailed for failing to pay child support for a child that DNA proved wasn’t his child.
About a year ago, a guy name Thom Ball went on the ultimate strike over this.
Men are going “on strike” because American society has taught them that they should expect a woman to take care of everything. It’s hardly realistic to argue that the men have no incentives. They are paid more to do the same job with less education and lower expectations. If they want to “backlash” over that, then they will find their lives a bit more difficult than necessary.
Oh no…we were just talking about this…
http://www.duffelblog.com/2013/06/doma-military-troops-gay/
“Semper Pink”
What’s really going on in California
California imposed a new law on banks innocuously called “Homeowners Bill of Rights” which forces banks to switch over to a judicial foreclosure process, which they can opt to do on their own, but takes a year or more to renegotiate contracts and compensation structures for the foreclosure law firms who do all the leg work for the banks. And while those changes are being made… it makes it appear that foreclosures have slowed down dramatically in the state.
The reality?
Defaults (undeclared) are spiraling upward that yet have to pass through the foreclosure pipeline.
The truth?
California is still the highest foreclosure state in sheer volume and percentage.
The low-down?
Resale housing in California is still massively overpriced as a result of unprecedented interference by individual states and the federal government. The market distortions will be removed and the down draft will continue allowing the market to correct.
With millions of excess empty houses and housing demand at 17 year lows, housing prices have a long way to fall. A very long way to fall.
if u.s. mass media were state-controlled, would they look any different?
http://www.counterpunch.org/2013/06/27/snowden-coverage/
http://www.counterpunch.org/2013/06/26/why-the-ruling-class-is-so-upset-about-edward-snowden/
“Housing could still drop significantly and the bottom might not arrive for years.”- Robert Shiller
http://finance.yahoo.com/blogs/daily-ticker/shiller-house-prices-probably-won-t-hit-bottom-162755874.html
September 2011 commentary from Prof Shiller:
“House prices won’t necessarily plunge from here in nominal terms, but in real terms–after adjusting for inflation–they could still drop significantly, Professor Shiller says. And the bottom might not arrive for years.”
http://video.foxbusiness.com/v/2506003951001/shiller-wouldnt-call-it-a-housing-boom/
June 25, 2013 commentary from Prof Shiller:
“It’s not boom territory…it reminds me of 1998 at the very beginning of the last boom…I think home prices will probably go up for another 6 months or another year, pretty sure, but beyond that I don’t know…they could go down again (like they did in 2009/2010 after the tax credit wore off)”
He also thinks that when investors start to move out (if they move out), it could cause prices to fall.
“If you buy a house today at these massively inflated prices, you will be underwater instantly and you will never recover financially. Beware.”
Someone asked me the other day to post job openings at my company. I’m not comfortable with putting my company name out there, but, I figured I post a few similar positions (the mythical 100K+ IT jobs) at some other companies.
http://jobs.vmware.com/job/San-Francisco-Staff-Systems-Engineer-%28Strategic-Account-Pre-sales%29-Bay-Area-Job-CA-94101/2674159/?feedId=4&utm_source=Indeed
http://www.publicisgroupe.com/#/en/career/talent/offer/filterLang/EN/id/RS00010
Here are 2 similar to our job postings. These jobs are probably “low 100’s”, maybe topping in the 120K range or so. The jobs my company posts typically requires more network certification; but we pay quite a bit more than most other employers as well.
The other guaranteed 100K job for someone in tech is to become an SE for a major manufacturer. NTAP/Cisco/VMware/EMC/etc. All of these positions are going to be “mid-100s” to “low-200s” depending on sales targets/goals and, of course, your personal success. BTW, SEs are NOT direct sales, they are engineers that work with a sales guy. No cold calling, no client management, and a much higher base (but, of course, much lower commission structure) than a sales employee.
All of these jobs, BTW, are going to involve pretty significant travel. You may be able to work up to a point where you don’t have to travel as much, but, in the beginning, you’ll probably be on the road 50%+ of the time. Also, those without people skills aren’t going to do well (or even be offered) these jobs. The “value” in these roles is that the engineers can become a trusted adviser to the customer and help shape their buying decisions to purchase one company’s “stuff” over another. If your a non-native speaker, you likely don’t have much chance at these positions except in specific markets.
I would put those more in a sales category than an IT category.
Also, 120k in the Bay area is like 70k anywhere normal.
Not saying you’re wrong, I haven’t been in IT for 7 years now, but I don’t think those examples prove your point.
My point wasn’t that IT jobs are a holy grail. It’s that there are plenty of 100K plus jobs out there for people in IT with the right skills. So many, in fact, that we have many reqs that go months without a single application. Not because nobody has the skills (I know lots of people who do) but because they are gainfully employed somewhere else (happily, or, happy enough to not make a change).
And, in very recent experience, 2 buddies of mine were fired from NetApp a month ago and already have new jobs (both 150K plus) at another storage company. They were let go because they were unwilling to relocate; so it’s not like they were poor performers. Neither of them was upset; they knew they could replace the job easily (they just wanted to negotiate the best possible severance package).
My point in all this; yes, IT jobs are out there for people with the right credentials and skills. And yes, they pay very well compared to what most people make. And, yes, they require a lot of you as an employee (travel, retraining, etc).
they just wanted to negotiate the best possible severance package
Negotiate? Since when do fired workers have any leverage to negotiate that?
They negotiate a severance package to get them to quit (rather than fire them). Better for the company (I guess) and better for the employee. Most of the time it’s something like 1 month of pay for every year of work. The guys I know got 5-7 months of pay.
So they weren’t “fired” as you said above. FWIW, that kind of treatment is getting pretty rare these days.
“So they weren’t “fired” as you said above.”
Well, we’re arguing semantics here, but, no, I guess you could say that they quit under pressure. Had they not quit, they would have been fired. Either way, they were no longer going to be with that employer come a certain date very soon in the future.
No one has said that highly skilled techies can’t earn ~100K. But considering how hard these jobs are to fill and that a firefighter or a cop can earn a comparable salary, the pay isn’t that impressive, especially considering the heavy travel and interpersonal skills that are required. Sales droids working for the same company will be paid much, much more (if they meet their quotas).
There’s a reason why smart people are avoiding tech careers. They’re hard as nails and the pay is mediocre when compared to other “hard as nails” professions. I once met a guy who was some kind of environmental engineer at the old Rocky Flats cleanup site. He was paid 200K and laughed at techies who competed with “Pakistanis” for their low paying jobs. I know another guy who flies cargo jets for DHL: $200K+. My old dentist drives a 7 series BMW.
State troopers make 100k+ after a few yrs. Cops make it once they make seargent (and many do O/T on top of that, whereas Overtaxed’s coolies don’t get paid extra for O/T or travel.)
Overtaxed’s job postings are a joke. “Hey, you can work long hours, do lots of travel, have a lot of different tech certifications, but we’ll pay you what a Maryland State Trooper makes in a 40 hr work week after 5-6 yrs on the job. Oh, and did we mention, our health plan is crappy by comparison and we give you a 401k instead of a pension?”
LULZ for days @ Overtaxed’s idea of a good job! Seriously, big lulz.
I think this countries on the right path
Degrade engineering new inventions all come from alien technology anyway. If dumdass Al Gore can invent the internet how hard can it be anyway ?
If your smart become a Banker and or lawyer and sell junk mortgages to the pension funds of State troopers they are over paid anyway
can’t do either ? join home land security. Always have openings, America needs protection from all our enemies..
Overtaxed’s jobs should pay more considering all the travels, but he is right in the sense that there are alot of 100k+ jobs to be had in IT if you have the right skill. These jobs don’t require travel/overtime, etc. They aren’t that difficult either….more on the routine boring side like the law jobs.
LOL, you guys are something else.
First, you tell me that my 100K tech jobs aren’t real and nobody pays that much. Then, you tell me that 100K isn’t enough. And, BTW, we’re focusing on 100K as some kind of breakpoint. The last CCIE we hired was around 130K salary, 26K annual bonus (if we meet revenue goals, could be higher or slightly lower), 401K match at 50%, fully paid individual health and dental and, of course, work from home when not traveling.
Trust me, once you get to a manager level (the step above where we hire most people; senior architects), there’s not a Maryland St trooper in recorded history that’s making what you do. Also, I think you’re overstating the salary for police quite a bit:
“The squad’s leader earned $63,221 in overtime and $167,890 overall, topping all other troopers, including Superintendent Rick Fuentes, who earned $144,966, according to the payroll records.”
http://www.nj.com/news/index.ssf/2011/12/six_nj_state_police_troopers_e.html
So, what is it? Do we pay too much or too little? I need to let our HR department know immediately.
“Sales droids working for the same company will be paid much, much more (if they meet their quotas).”
Now, that part is right on the money. We have a few 7 figure sales droids running around in the company. A few made more than the CEO. Technical pay, even at the highest levels (principal engineer, for example) are going to top out in the high 2’s (maybe low 3’s). For a good sales guy, that’s just getting started.
Good for state troopers pay and the cities that pay it out ?
answer noooo
“Did the Fed just torpedo the muni bond market?
Maybe so. June looks like it will be one of the worst months for the municipal bond market in years. To put it in perspective, see what’s happening in Illinois: The recent interest rate spike will cost the state $130 million over the next 25 years — and that’s for just one new borrowing. On top of that, many cities and states, including Philadelphia and Georgia, have delayed sales of new bonds because of the deteriorating muni market, The New York Times reports.
So the pain will be felt across the U.S. — in states that have navigated the choppy waters of the recession, even prospered (see Texas and North Dakota) and in states like Illinois and New Jersey, that are already in dire financial straits.
There’s a reason why smart people are avoiding tech careers. They’re hard as nails and the pay is mediocre when compared to other “hard as nails” professions. I once met a guy who was some kind of environmental engineer at the old Rocky Flats cleanup site. He was paid 200K and laughed at techies who competed with “Pakistanis” for their low paying jobs. I know another guy who flies cargo jets for DHL: $200K+. My old dentist drives a 7 series BMW.”
brilliant
Colorado for president
“Requirements:
- 12+ years experience in technology related work, including roles in Pre-sales and/or customer-facing Consultant
- Ability to collaborate with and motivate multiple groups toward accomplishing a task
- Enthusiastic, self-starter with a charismatic personality
- Proven track record of selling services as part of a solution
- Ability to see and present “the big picture” and offer solutions to make it better
- Strong customer facing and relationship building skills
- Must be effective in working both independently and in a team setting
- Strong listening and question based selling skills
- Ability to uncover business challenges and develop a custom solution to solve those challenges
- Experience with enterprise applications, security, systems management, and business continuity solutions a plus
- Ability to travel as necessary
- BA/BS or equivalent required”
————
12+ years experience and this laundry list of requirements, plus all that travel you mention. Do you realize how shitty this job actually is? People with just some random job in a non-flyover state can crush this job without 80 hr weeks and constant travel.
That list of requirements makes this 100K job seem “shitty”? What list would you like to see for your 100K job?
1. Breathing
2. Will show up occasionally and do crappy work
??
Yes, you need some experience. Yes, you need to be a self-starter (because you’re always on your own). You need a BS (although this is often waived if you have enough certs). And you need to travel. Which one of those makes this a “shitty” job?
Sometimes the folks on here crack me up.
Dude starting lawyer pay at a big firm is approx 200k now. And you’re posting jobs paying 100-120k with 12 yrs experience.
Give it up.
Most of these people would be better off becoming a state trooper or something similar. I don’t know any state troopers with 10 yrs on the job in a decent state who make under 100k and they get 4 weeks vaca, excellent benefits, and a real retirement plan. Also don’t need to worry about getting laid off or having 2 dozen different technical certifications.
“Also don’t need to worry about getting laid off or having 2 dozen different technical certifications.”
Just need to worry about pulling over the wrong car at 2am and not seeing 3am.
Is this 200k lawyer an example of a random job in a non-flyover state? Also, isn’t the story that we typically hear that those lawters are workgin 70-80 hours per week to pile up the billable hours because they’re hoping to become partners?
Based on my limited experience (seeing my wife’s experience as an attorney), there are limited numbers of paths through a lawfirm:
1. Bust your butt for a decade and never make partner;
2. Bust your butt for a decade and make partner;
3. Bust your butt for 5-7 years and go in-house (where you still might bust your butt);
4. Don’t bust your butt, and maybe get fired.
Since being partner never mattered to my wife, she took path #3.
This looks like a sales position, perhaps getting agencies and companies to buy enterprise software.
An extroverted sales-type who likes to travel might love it.
This is a poach listing.
The 12+ years isn’t for technical experience. They want a person who lasted 12 years IN SALES without getting laid off along the way. The only way to last 12+ years in sales without getting laid off along the way is to already have built up a thick list of repeat business clients. There is no cold calling because that salesperson is fully expected to bring the old clients to the new company.
Good luck getting that kind of business for $100K.
People would be nuts to take that job, seriously. I make roughly twice what these guys would make and almost never travel more than a few miles out to a client or down the street to an agency for a contrac award debriefing. I also know jack about computers and only had to pass one licensing exam rather than have a million different certifications.
Overtaxed posts get me pumped up because I usually think “ugh, law school, wtf was I thinking” but then I realize he lives in a world where you’re worked like an indentured servant.
But you had to go to school for 8 years vs. the 4 that these jobs require.
Listen, I guess we can all just agree that my job sucks, and, even further, that my entire field sucks; everyone should be a cop earning 100K or a lawyer earning 200K.
I happen to like what I do, and am very happy with how my career has shaped up over the past 10 years. I don’t think that I’d change anything on my career path; it’s been good to me, and I never wake up in the morning thinking “oh god, I have to do that again”.
You guys are also downplaying some very significant differences between the mythical “100K staring salary cop” and the jobs similar to mine in IT. The 100K cop is never going to get to 200K. The 100K cop has crazy hours, and much more workplace danger. No stock options. No travel (if that’s something you like). And as hostile a workplace as you can possibly imagine (you think a client is pissed that their 2 million dollar install went badly? Try arresting them at 3AM for a DUI; that’s pissed off!!).
Yes, being a cop can be a very good career path for some. And yes, some people make very good money doing it. If you remember, this whole conversation started when I said we had lots of 100K+ jobs open without people to fill them. People couldn’t believe it, so I posted some similar positions, and then, instead of accepting that there are in fact, lots of 100K+ IT positions open, they attack the position as a sh**ty job. Hey, it is what it is.
Yes, being a lawyer or doctor can very likely lead you to higher incomes. As would be expected given the higher level of education (read $$$) required. And, not everyone wants to be a lawyer or doctor.
“I make roughly twice what these guys would make and almost never travel more than a few miles out to a client or down the street to an agency for a contrac award debriefing.”
Not everyone hates travel. In my younger days I traveled 100% of the time. I loved it. I was on an expense account all over the globe. And being away from home all the time my living expenses were practically $0 outside of rent. I didn’t even own a car. What I did was rent a car when I was home which I expensed back to my employer (which they of course expnsed back to the client) as it was cheaper for me to do that than take a taxi to and from the airport. And as long as the fare was comparable to flying home, I could go anywhere I wanted for the weekend. Feel like spending a weekend in Miami? Done. Las Vegas? Done. Cabo? Done. Weekend ski trip in Whistler, why not…book a flight to Vancouver on the house.
And all the frequent flier miles and hotel points racked up…..I don’t think I will ever have to pay for a hotel room or commercial flight in my lifetime.
I don’t travel nearly as much today. But I’ll still take a business trip on average once a month. And I still dig it.
And, not everyone wants to be a lawyer or doctor.
Blasphemy! It was every kid’s dream to spend 60 hrs a week reading mindless depositions. Don’t even talk to me about dealing with sick people all day for rest of my life.
If it’s a sales job then you don’t know what the pay is since sales pay is commission pay. Maybe $100K base? That sounds more likely which means with commission/bonus/kickers, it’s easy $200K and probably more.
Also requirements mean nothing. We constantly hire people not even having half the skills listed. Many times, it’s all about not having to go thru 100’s of resumes……HRs love that.
I will say this. My daughter and her friend created a cooking website while in college to document their attempts for feed themselves.
My daughter managed to get a paying internship for the summer. There are not too many of those. On the first day they had her fix up the website. It isn’t hard — if you know how to do it.
So much for anonymity:
http://cironline.org/reports/license-plate-readers-let-police-collect-millions-records-drivers-4883
Nice post AB….
Heal, the retired sheriff’s commander, said that absent clear legal limits on license-plate readers, law enforcement agencies will continue to expand their ability to gather such information.
“A lot of the guidance on this technology – the court doctrine – is nonexistent,” Heal said. “Until that guidance comes, law enforcement is in an exploratory mode.”
Wow….Just Wow….
Exploratory Mode = Do whatever the hell we want to do, until the courts/people get pizzed off enough to make us stop.
I remember seeing them used for parking violators in Monterey, Ca.
but I still don’t know how someone gets hurt chalking a tire.
AutoFind has been deployed in more than 30 North American cities, including Chicago and Salt Lake City. One of the first was Monterey, Calif., which has used a single unit to enforce parking regulations and find scofflaws since 2002.
For Monterey, the main incentive was to reduce on-the-job injuries. “We had quite a few workers’ comp claims from chalking,” said Wayne Dalton, administrative analyst for the city. “We were looking for a way we could do the routes with a light-duty person.”
link
“Rising interest rates may be causing some buyers who were on the fence to get in quickly before they are priced out.”
http://finance.yahoo.com/news/pending-home-sales-soar-6-140000315.html
Uh oh, she came dangerously close to saying “Buy now or be priced out forever”. I didn’t think I would see that language again, but here it comes.
Rising rates got me down from the fence, but not on the side she’s talking about.
I’ll sit here in the green grass, chortling as I watch my savings become worth more relative to a house, as my moneyless competitors are forced to the margins of the field by rising interest rates.
Bring on the 10% interest!
US economy in a nutshell.
Oh, don’t worry everything is fine….we have it under control….green shoots everywhere…..go out and spend your money……give us (oligarchs) more power and money for managing this so well…..
Then Bam!…One day in near future…
Everything is not fine…..black swans everywhere…..nobody saw it coming……the whole system is collapsing…..there will be blood on the street….we are in a depression….give us more money and power…..go out and spend your money.
I was just listening to a piece on NPR a few minutes ago, where the guest was commenting that there is a feeling within the Fed that it has begun to raise rates because the economy is improving. She went on to begin, “The issue with that is…”
What I thought she’d say: “…that the economy has been rebuilding BECAUSE of QE in the first place.”
What she said instead (paraphrasing again): “…because much of that improvement is in housing. When people buy a house, they spend on landscaping, appliances, etc. If you raise rates, the resulting increased monthly housing cost cuts down on how much they can spend in other areas.”
Two things:
(1) No acknowledgment in the media as to where this improvement is REALLY coming from.
(2) As Al stated above, there’s never mention (that I’ve seen in popular media) suggesting that the answer with rates moving higher is to wait it out a bit for lower prices, bringing the monthly nut back to equilibrium.
Two things:
(1) No acknowledgment in the media as to where this improvement is REALLY coming from.
A flood of cheap money?
(2) As Al stated above, there’s never mention (that I’ve seen in popular media) suggesting that the answer with rates moving higher is to wait it out a bit for lower prices, bringing the monthly nut back to equilibrium.
Not nice to say such things. Gotta buy now!
And that’s what they are suggesting that buyers are starting to do.
And in those segments I hear on that part of it they NEVER, not ever, suggest the inverse relationship between rates and prices and the potential pitfalls of rushing to buy. Never.
Nah, when you raise rates, it simply causes the price of the house to go down, which leaves them with the same amount to spend on other stuff.
I have to babysit the college-age nephew of a client’s General Counsel all next month. No idea how I was chosen. We have younger people (fresh out of LS) that could do this but I’m always super friendly when I see the senior partners so they obviously aren’t onto me. The _only_ upside I can see is that I get to use the firm credit card a few times for splurge-y lunches and the ability to write off hours to a “mentoring” billing code that I would never otherwise use. I can’t tell this kid not to go to law school or wake him up to how contractors rip off the government, but I am thinking of ways to make these conclusions occur to him. I have another week to plan for this… it’s going to be a long summer of cynicism and sarcasm.
Why can’t you tell him about how contractors rip off the government?
Granted, Andrew Lloyd Webber is a talented composer, writer, dreamer, but did he have to buy my dream property!
http://jennykirwan.com/tag/sydmonton-court-estate/
(I confirmed he owned it in an interview where he was asked about it.)
Now that’s living.
I love that the pic was taken from Watership Down. Yup, the actual Watership Down. Awesome…
Aww….. look at the DonkeyFest.
Yeah, looks like the Finger Lakes.
Housing Bubble Redux in Phoenix? Realtor says no. That is good enough for me. Ha.
“We met Welden at a home under contract. It’s a 4 bedroom, 2,500 square foot home in Ahwatukee.
Asking price $315,000. About two years ago this house sold for $247,000. That’s a $68,000 swing in price in a short amount of time.
The difference, says Welden — the people buying houses these days are well qualified. No fast and loose loans like the first bubble.
“The credit restrictions to get mortgages today are so much more restrictive than what they were a long time ago, that it’s eliminating that bubble from forming in the future.”
http://www.myfoxphoenix.com/story/22686949/2013/06/25/housing-bubble-ii-some-worry-about-increasing-home-prices
If credit loosens to match the first bubble, then the rebubble will be just as bad. Otherwise, it will be a dead-cat bounce. Either way, prices are too high in many places and must crash.
Hi, everyone. Been 5 years. Just dropped by to see who was still here for Bubble II - The Revenge. I feel the old familiar bile rising when I read these stories. Once again, I hope they all go broke. Idiots.
Waaaaassssssuuuuuup
Has it been 5 years?
jeff saturday
Welcome back. You were always a hoot.
I hope the stock market crashes soon.
Welcome back, I remember you from back then, took a break for a few years myself after the crash (and FWIW sold my own place in early 2007 thanks in large part to the HBB). Still a lot of very sharp, well informed, and funny people here but also a couple of EXTREMELY obnoxious trolls these days…really wish there was an ignore function here so I did not even see their posts but that is probably not even an option on a blog, especially when no login is required. Anyway, the signal to noise ratio was much better back in the day but there is still plenty of worthwhile stuff here to make daily reading worthwhile (and inspire me to make a donation today)
There is a thing called the Joshua Tree extension. It enables ignoring.
The drama queens won’t have anything to complain about if they use it.
Wow…got any stock tips?
I bought a house a year ago, which was evidently a big event, because I’m still assailed for it every day.
For me, the rent v buy equation came down on the side of buying.
By now you must be filthy rich with the stock market runup from 6000+ to 15000 since early 2009.
Well Victim….. If you weren’t seeking vindication every day, you wouldn’t getting smacked down for it. Smarten up.
I wonder how many have done the same but fear the same fate so don’t fess up.
I’ve always felt bad you were taking this daily beating but have to admit you hold up well.
HEY chick!!! Have missed your commentary on way too many topics way too many times. So glad you’re back to enlighten us and keep us honest.
Don’t go off the radar and stay away from the drills.
Gold! Gold! Gold!
http://www.zerohedge.com/news/2013-06-27/gold-breaks-below-1200
Since we often discuss locales, I do a lot of google image searches…
“Finger Lakes Fall”
Amazing
“Oil City”
Completely Pathetic
“Rio De Janeiro” (a nod to Rio)
Lookin’ good
“Austin, TX”
Looks nice
“Housing Bubble”
Wow, a lot more than there used to be. ALOT more.
What’s wrong with Oil City?
Rising Home Prices Are ‘Unsustainable’—Realtors
Published: Thursday, 20 Jun 2013 | 12:11 PM ET
By: Diana Olick | CNBC Real Estate Reporter
For six straight months, home prices have been leaping in double digits from a year ago. In May, the median existing home sale price was 15.4 percent higher nationally than May of 2012, according to a new report from the National Association of Realtors.
The Realtors themselves say that kind of jump is “unsustainable.”
“Some of the increases can be explained by the fact that it is recovering from an over-corrected situation,” said Lawrence Yun, chief economist for the Realtors. “But with people’s income rising at only 1 or 2 percent and prices rising in double digits, it cannot continue.”
http://www.cnbc.com/id/100831431 - 78k -
Non-King Cole
Unsustainable, that’s what they are
Unsustainable, live in your car
Like the stench of debt that clings to you
That refied house you bought back in 02
Never before has price rise been more
Unsustainable in every way
And forever more, the Beats won’t pay
That’s why, victim, it’s unthinkable
You drank it twice, it’s still undrinkable
With bailouts you are still unsinkable too
Nat King Cole - Unforgettable - YouTube
http://www.youtube.com/watch?v=S1UEzL9poPM - 149k -
False Tapering = Expanding.
$96 billion expansion of credit in the month of June.
http://www.federalreserve.gov/releases/h41/
This is why gold prices are a bargain now. Most people do not realize it but credit is going the opposite way. Tom Luongo said last Friday on SeekingAlpha “If next week’s number comes in higher than [$20 billion] then the Fed is having to accelerate its purchasing to soak up the selling happening overseas and still yields are rising.”
I have never been banned from the HBB. That should be a weekend topic. Whomever has never been banned should say so. We could start a commune in Oil City together.
Uncle Sam isn’t the only governmental entity facing severe budget issues.
National Briefing | Northwest
Washington: Layoffs Possible Over Budget Impasse
By THE ASSOCIATED PRESS
Published: June 24, 2013
Thousands of state government workers are getting notifications that they may be temporarily laid off starting next week. Financial managers under Gov. Jay Inslee directed agencies to start sending notices Monday afternoon because lawmakers have been unable to finalize a budget. The Office of Financial Management estimates that at least 25,000 would be furloughed if there is no budget deal, although not all would be notified on Monday. Washington’s current two-year budget comes to a close at the end of June. Leaders in both parties have repeatedly asserted that they will reach agreement and avoid a government shutdown, although lawmakers have missed all their other deadlines so far. They were initially supposed to complete a budget in April.
WRONG COMPARISON:
“The rate on 30-year loan soared from 3.93 percent last week to 4.46 percent this week — the biggest one-week jump in 26 years.
The effect on buyers’ wallets in just the past two months is striking.
A buyer who locked in a 3.35 percent rate in early May on a $200,000 mortgage would pay $881 a month, according to Bankrate.com. The same mortgage at a 4.46 percent rate would run $1,008 a month.
The difference: $127 more a month, or $45,720 over the lifetime of the loan. Those figures don’t include taxes, insurance, or initial down payments.”
CORRECTED VERSION:
A buyer who locked in a 3.35 percent rate in early May on a $200,000 mortgage would pay $881 a month, according to Bankrate.com. The same mortgage at a 4.46 percent rate would
run $1,008 a monthmerely enable the buyer to afford a purchase price of ($881/$1,008)*$200,000 = $174,802, 12.6% lower than at a 3.35 percent rate.Mortgage rates jump to 2-year high
By Marcy Gordon and Alex Veiga
Associated Press
June 28, 2013
The rate on a 30-year loan soared last week from 3.93 to 4.46 percent, the biggest one-week jump in 26 years.
Nam Y. Huh/Associated Press
The rate on a 30-year loan soared last week from 3.93 to 4.46 percent, the biggest one-week jump in 26 years.
WASHINGTON — US mortgage rates have suddenly jumped from near-record lows and are adding thousands of dollars to the cost of buying a home.
The average rate on the 30-year fixed loan soared this week to 4.46 percent, according to a report Thursday from mortgage buyer Freddie Mac. That is the highest average in two years and a full point more than a month ago.
The surge follows the Federal Reserve’s signal that it could slow its bond purchases this year. A pullback would probably send long-term interest rates even higher.
In the short run, the spike in rates might be causing more people to consider buying a home soon. Rates are still low by historical standards, and would-be buyers would want to lock them in before they rise further.
But eventually, more expensive home loans could price some people out and slow the housing market’s momentum.
‘‘People are getting off the fence a little bit more or choosing to buy now instead of choosing to buy three months from now,’’ said Anthony Geraci, a Cleveland real estate broker-owner.
Mortgage rates are rising because they tend to track the yield on the 10-year Treasury note, a benchmark for most long-term interest rates. The 10-year yield began rising from near-record lows in May after speculation grew that the Fed might be closer to reducing its bond purchases.
In early May, the average rate on a 30-year mortgage was 3.35 percent, just above the record low of 3.31 percent.
But rates began to surge after Fed chairman Ben Bernanke made more explicit comments about the Fed’s plans. He said the Fed would probably scale back its bond-buying later this year and end it next year if the economy continued to strengthen.
The rate on 30-year loan soared from 3.93 percent last week to 4.46 percent this week — the biggest one-week jump in 26 years.
The effect on buyers’ wallets in just the past two months is striking.
A buyer who locked in a 3.35 percent rate in early May on a $200,000 mortgage would pay $881 a month, according to Bankrate.com. The same mortgage at a 4.46 percent rate would run $1,008 a month.
The difference: $127 more a month, or $45,720 over the lifetime of the loan. Those figures don’t include taxes, insurance, or initial down payments.
…
Is your investing style bull, bear or feral hog?
FOMC members’ recent comments suggest they have lost control of the long end of the yield curve and are trying to deflect blame by demonizing investors who are trying to steer clear of further bond market losses as “feral hogs” (whatever that means).
June 27, 2013, 4:01 p.m. EDT
3 more Fed officials chastise ‘feral hogs’
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) — Three top Federal Reserve officials on Thursday took issue with the jump in interest rates since the central bank’s meeting last week, saying that they were not based on anything policy makers had intended.
Markets are now pricing in more rate hikes than had been assumed before last week’s policy meeting and news conference by Federal Reserve Chairman Ben Bernanke. Fed fund futures imply at least three quarter-point rate hikes, and possibly four, by the end of 2015.
Earlier this week, Dallas Fed President Richard Fisher likened market participants to “feral hogs” for pushing bond yields higher.
On Thursday, William Dudley, the president of the New York Fed, Fed Gov. Jerome Powell and Atlanta Fed President Dennis Lockhart were less colorful but more pointed.
Dudley said expectations of an earlier rate hike were “quite out of sync” with both FOMC statements and the expectations of most FOMC participants.”
Any rise in short-term rates “is very likely to be a long way off,” he stressed.
Powell, in a separate appearance, said the spike in bond yields over the past month is“larger” than would be justified by any “reasonable reassessment” of the path of Fed policy.
“In particular, the reaction of the forward and futures markets for short-term rates appears out of keeping with my assessment of the Fed’s intentions, given its forecasts,” Powell said in a speech at The Bipartisan Policy Center.
…
They are serious in trying to counter the treasury selloff from foreign CBs, hence they expanded credit this week by $24 billion, bringing the June total to $96 billion. Is that “tapering?”