Bits Bucket for August 28, 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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“With 25 million excess, empty and defaulted houses and another 35 million houses to be vacated as boomers die off, what do you think is going to happen to housing prices?”
Since both of those claims are laughably wrong…. the question is moot.
That’s right. And you stay in the corner with that blindfold on.
Good boy.
We could argue this point day-in, day-out for years, and doing so would do nothing to eliminate the physical reality of millions and millions of vacant homes in shadow inventory.
Editorial: Vacant housing can be a business for pioneers, profiteers
18 hours ago • By the Editorial Board
It is no secret that for at least six decades, people have been abandoning homes in the city of St. Louis way faster than others have been moving in. In 2010, the Census Bureau reported that 19.4 percent of the city’s housing units were vacant, the second-highest rate among the 81 U.S. cities with populations of at least 100,000. New Orleans, post-Hurricane Katrina, was No. 1. Detroit may have caught up by now.
Vacant houses are at once a problem and a symptom of far larger problems. If there were good schools, plenty of jobs, racial justice and low crime rates, there would be far fewer empty houses. But if a city loses 530,000 people in 60 years, and offers them plenty of red-lined suburban options and interstate highways to get there, you’re going to wind up with 35,000 vacant housing units and empty lots where thousands of others once stood.
…
Back to work rank and file…
“Liberty Mutual is cutting back contributions to retirement plans and other benefits for its employees, just a year after a public uproar over lavish pay and perks for top executives of the Boston insurer.
The cuts come on the heels of the retirement of former chief executive Edmund F. “Ted” Kelly, who earned $200 million over a four-year period, making him one of the nation’s highest-paid executives. Kelly is receiving an annual pension of about $3.3 million, according to prior Globe reports
Mark Touhey, manager of compensation and benefits at Liberty Mutual, acknowledged some may “try to connect” the benefits cuts for rank-and-file employees and criticism over pay for the company’s top executives. ”
http://www.boston.com/business/news/2013/08/27/liberty-mutual-cuts-retiree-benefits-retirement-contributions-for-rank-and-file/j4v463eKJzrmPXVDGHV7mJ/story.html?p1=Well_MostPop_Emailed3
On Wall Street, average pay has stayed high but employment has gone down. Less due dillegeance and finding good investments, more of the money from QE going to fewer people.
“…more of the money from QE going to fewer people.”
Nice summary of the distribution of economic impacts under QE1, QE2 and QE3…
Look no further than this business model for the truth as to what really happened to America. Greed.
People have always been greedy.
What happened was that we removed the confiscatory high top-marginal tax rate with lots of deductions that had kept high income earners spending. This avoided the problem of too much money ending up in too few hands.
We embraced, rather than actively attacking, trade imbalance…
THAT is what changed!
What else changed was deregulation of the FIRE sector in the 1980s.
This was (one of) the direct cause of the Savings & Loan disaster.
Sound familiar?
We removed the controls so that we could get debt flowing, BECAUSE we needed debt to allow the economy to function in the face of imbalances.
“We removed the controls so that we could get debt flowing,…”
How is it that concentrating an increasing share of wealth in the hands of a shrinking pool of New Age noblemen supposed to be an improvement?
Historically the kind of development the Fed and other central bankers have recently fostered led to social unrest and revolution. Perhaps it is different this time?
What changed is two-fold:
1) A lot of people started to invest in the stock market through their 401ks (after that particular “vehicle” was invented by Johnson and Johnson, then codified by Congress). These people don’t hold enough shares in any one company to feel compelled to vote in the shareholder elections. Most companies have a rule that if you don’t vote no, it’s considered an automatic yes. This makes it extremely easy for members of the Board of Directors to give each other senseless compensation packages.
2) The United States decided to foolishly dabble in free trade. Free trade has done nothing good for this country. It has resulted in a huge flow of money out of the country, and into the bank accounts of despots in third-world countries. Hence, employees have no clout, and employees receive lesser and lesser pay as time goes on. Even though we can all see this happening, the ultrarich continue to fund a perpetual PR machine, which has people convinced that free trade is good for the economy. They don’t even call it “free trade” anymore; they just call it “trade”. Like you can’t have trade unless it’s untariffed.
These people don’t hold enough shares in any one company to feel compelled to vote in the shareholder elections. Most companies have a rule that if you don’t vote no, it’s considered an automatic yes. This makes it extremely easy for members of the Board of Directors to give each other senseless compensation packages.
I think you’re right. But it just occurred to me that it may present a big opportunity soon for privately held companies to destroy their publicly held, poorly run competition.
Carl:
My employer was bought by a private equity company. It’s weird because I’ve been through a few “mergers”, but this is the first private one.
Once the 401K matches are history the migration from employer provided heath insurance to “Health Savings Plans” will begin, at first with generous employer contributions, which over time will shrink until they are gone. Don’t expect medical costs to come down, though. Your family doctor will still charge you $150 for a 15 minute office visit.
Never forget, the economy exists to generate profits, which the few are allowed to accumulate, so that we can enjoy an ever widening wealth disparity.
Don’t expect medical costs to come down, though. Your family doctor will still charge you $150 for a 15 minute office visit.”
Black market Pharmaceuticals and cash only “Doctors” working under the table. The rise of the antibiotic resistant bacteria as the former middle class joins the poor at the swap meet buying Mexican antibiotics. self treatment.
The economy is a ecosystem and will adapt as best it can to adverse and inefficient laws.
This will be easier for those living near the border. But yeah, I could see self treatment rise with black market, imported meds, or if you live close enough to the southern border, maybe trips to La Farmacia.
But how do you give yourself a colonoscopy or a mamogram?
But how do you give yourself a colonoscopy or a mamogram?
ipad? google glass?
But how do you give yourself a colonoscopy or a mamogram?
ipad? google glass?
I didn’t know the iPad was a tricorder
But first, we will all sprout straw hats, and sprigs of wheat will appear between our teeth (which we will chew), and patches will appear on our clothing, and we will look down and see that we are wearing plaid.
Did your bond investments benefit from yesterday’s flight-to-quality move?
Yesterday was a good day to own Treasurys or gold, and not much else.
TREASURIES-U.S. bond prices rise as Syria fears fuel safety bid
By Ellen Freilich and Luciana Lopez
4:41pm EDT
* German and U.S. data have little impact in market
* Treasury sells two-year notes at high yield of 0.386 pct
NEW YORK, Aug 27 (Reuters) - Prices for U.S. Treasuries rose on Tuesday in safe-haven bidding after reports that Western forces could attack Syria within days prompted nervous investors to dump riskier assets.
Global stocks slumped on the fears.
“The concerns about a potential escalation in Syria have led to a risk-off move across the board, and high-rated bonds like Treasuries have benefited from the flight to quality,” said Jake Lowery, a Treasury trader at ING Investment Management.
Participants at a meeting in Istanbul told Reuters that U.S. and other diplomats warned Syrian opposition leaders on Monday to expect action that would punish Syrian President Bashar al-Assad for poison gas attacks - and to be ready to negotiate if his government sues for peace.
…
Financial Times
ft.com/markets
Global Market Overview
Last updated: August 28, 2013 10:52 am
‘Risk off’ as Syria fretting adds to EM rout
By Jamie Chisholm in London and Patrick McGee in Hong Kong
Wednesday 10:40 BST. Oil prices are rising and stocks are sliding as the prospect of western military intervention against the Syrian government continues to rattle markets.
Risk aversion is weighing particularly heavily on emerging market currencies, which also continue to suffer amid fretting over slower growth and expectations of reduced Federal Reserve largesse.
…
Suck ‘em in, shake ‘em out.
Breaking news! There is trouble in the Middle East!
Sell out whatever it is that you happened to have bought last week. Don’t buy anything until after prices have gone back up again.
I am already hearing $200 per barrel oil again. The justification: Syria. The same one given for all of the incremental moves up to $110. Look for crude to kill off the economy. It could all be easily avoided by taking Wall St. pigs out of the equation. JP Morgan should not be the energy middleman.
“… amid fretting over slower growth and expectations of reduced Federal Reserve largesse.”
In that case, I don’t see why it’s necessary to include the Syria explanation.
Taper off?
Don’cha know there’s a war on?
How Syria crisis will bring Fed taper to a halt
The U.S. can’t grow if the rest of the world is slumping, argues Matthew Lynn
Somebody said the war is like the national guard weekend training. So, how come market is spooked and they are talking about not doing the taper or trim just as I predicted? Someone’s lying….
The U.S. can’t grow if the rest of the world is slumping, argues Matthew Lynn
I think Mr. Lynn got it backwards. The rest of the world is dependent on Americans living beyond their means.
Yup.
Aug. 28, 2013, 4:33 a.m. EDT
Asia slammed by Syria fears; stocks, rupee fall
PetroChina, Kunlun shares sink; Indian rupee takes a thrashing
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What to do if the U.S. gets involved in Syria
Stock Market Crash Talk Gains More Steam
Most Asia markets decline; Philippine shares hit
By V. Phani Kumar, MarketWatch
HONG KONG (MarketWatch) — Asian stocks slumped Wednesday after heightened fears of U.S.-led military intervention in Syria sparked a selloff in global markets, with Philippine shares and the Indian rupee plunging amid worries about emerging markets.
…
cnbc viewership is at 20 yr lows. I guess mom and pop are tired of cramers bs?
It is not just Cramer. Joe Kernen is a Limbaugh wanna-be.
The constant bickering between Liesman and Santelli has been SOOOOOO over done.
Everything else is a parade of CEOs and politician clowns saying that “what we need to do” is exactly what will personally benefit them the most, while screwing the vast unwashed masses.
What about Kudlow?
Talk about a neocon, supply sider, fed loving jackass.
Kudlow will need at least 7 lives to right the wrong he has done in CNBC.
“What about Kudlow?”
Self-evident.
santelli the only one worth a d@m.
“santelli the only one worth a d@m.”
He still doesn’t get it.
As a bond trader, he sees low interest rates and loose lending as the root cause of our ills.
He can’t take that extra step and see that the low interest rates and loose lending are a necessity to create new debt/money to replace the 10% of GDP that leaks from active circulation via massive international and domestic trade imbalances.
Who watches that cr@p?
I am reminded of a day I took my car in for a recall. In the waiting room there was an elderly couple waiting for their Cadillac. They were watching Fox, and soaking up every word. I guess they were living in mortal fear that the socialists would force them to trade down to a Buick.
As a bond trader, he sees low interest rates and loose lending as the root cause of our ills.”
Bond buyers want Deflation
If they ever allow a la carte TV, I guarantee that CNBC will be one of the first channels to fold. Only 1000 subscribers in Manhattan is not goint to cut it.
If they allowed ala carte tv, I think I’d have like 7 stations.
Sometimes I get up pretty early. I look through the tv listings and find that OVER HALF the stations are running some show called “Paid Programming”.
If we had ala carte, I’d cancel all of those.
If we had ala carte, I’d cancel all of those.
I cancelled all of them, put up an HD antenna for those rare occasions when I want to watch a soccer game on Univision and watch other stuff on Netflix.
Bulletin U.S. pending home sales fall 1.3% in July »
Aug. 28, 2013, 8:30 a.m. EDT
What U.S. intervention in Syria would mean
Commentary: What can we learn from past geo-political crises?
By Mark Hulbert, MarketWatch
CHAPEL HILL, N.C. (MarketWatch) — Rising interest rates and above-average valuations are a bigger threat to the stock market than the possibility of U.S. military action in Syria.
That’s worth remembering because commentators recently have been quick to blame the Syrian mess for the stock market’s weakness so far this month. From the first trading day of August, for example, the Dow (DJIA +0.18%) is now down more than 5%.
…
10 % correction ahead or 20 % bear market ?
Long-term Treasurys might offer a hint; down by over 15% since early May 2013 the last time I checked.
Slim with a data point from Tucson.
As y’all know, I’ve been doing the crowdfunding thing to launch a photo exhibit. In order to bump that funding total in the upward direction, I called one of my local bicycling buddies who is also a real estate agent.
Yeah, I know. Waddya doing talking to those REIC-sters, Slim.
Any-hoo, I was thinking that he’d be a good crowdfunder, what with all of his hyperventilating all over Facebook about how great the local real estate market is.
But I was quite wrong. He was very apologetic as he said that he wasn’t in a position to contribute.
Not to worry, however. I’m also hitting up a local bike shop owner and a friend who owns a warehousing/shipping company.
I always ignore friend requests from realtors on facebook and linkedin.
I’ll go check!
Pimco CEO El-Erian: 5 years after Lehman, I’m a worrywart
August 27, 2013, 3:40 PM
The world is just a few weekends away from the fifth anniversary of the collapse of Lehman Brothers and what is likely to be countless articles on what has and hasn’t changed.
Pimco CEO Mohamed A. El-Erian is getting a jump on that with his list of four developments that, like the collapse of a major investment bank, were previously considered unthinkable. In an essay published by Project Syndicate on Tuesday, he takes jabs at dysfunctional governments and policy makers that have let banks go back to business as usual, among others. He writes:
…
“Comment by alpha-sloth
2013-08-27 12:40:37
Bankruptcy destroyed the debt side of money, but the money borrowed remained. This, too, helped us run trade deficits longer than otherwise possible. Tightening the bankruptcy laws makes it harder to run them.”
When an IOU (debt) goes away, the offsetting UOMe (money) also goes away. It may not be the same money that goes away, but money does indeed go away.
I have $1 million and use it to start a bank. My bank now has $1 million tier one capital. I get $100K deposits so make $93K in new loans. $93K new money created.
The loans all default and have to be written off. The $93K created by the loans is still in the economy, BUT I have to write off the loss against my tier one capital. $93K that existed before I opened a bank, and before I issued any loans, is destroyed.
“The loans all default and have to be written off.”
If the debt is in the form of promises then it REALLY becomes easy to write off.
A fully funded pension plan means never having to say you’re sorry.
During the Great Depression the nation’s money supply shrunk by about a third.
So, where did this all money go?
this all = all this
It might be useful to think of the money supply as “open interest” in the same way that commodity futures spring into being out of nothingness and then later on go back to the nothingness that they were sprung from.
In the case of the dollar we are not yet at the nothingness state.
A difference (one of several) is a futures contract allows one the right to claim a commodity at a given price. A handful of dollars also allows one to claim a commodity but the price is not one that is given.
“During the Great Depression the nation’s money supply shrunk by about a third.
So, where did this all money go?”
Are you asking Alpha-sloth or me?
Alphs-sloth’s claim was that money doesn’t go away when the debt is written off.
My assertion is that it most certainly does go away. It may not be the exact same dollar that gets created and destroyed, but a dollar of money is destroyed when a dollar of debt goes away.
My grandfather had $100k in the bank. Went to get it in 1931 and the bank was closed and the money gone.
Oh, the days before FDIC.
Now the federal government would just borrow new money into existence to ensure grandfather got paid.
The federal government would print money, not borrow it.
Coastal elitist libtard bedwetters interfere with local elections
Denver Post - Michael Bloomberg donates $350,000 to fight Colorado recall efforts:
“Senate President John Morse of Colorado Springs and Sen. Angela Giron of Pueblo face separate recall elections in their districts on Sept. 10 for supporting gun-control legislation in the 2013 session.
Bloomberg’s group, Mayors Against Illegal Guns, supported the gun measures, which passed the Democratic-controlled legislature and were signed into law by Democratic Gov. John Hickenlooper.
Bloomberg donated the money to Taxpayers for Responsible Democracy, which is fighting both recall efforts, according to campaign finance reports filed Tuesday.”
http://www.denverpost.com/breakingnews/ci_23956889/colorado-supreme-court-rules-recall-election
Forget the recalls, the folks out in the eastern agricultural counties want to secede and create the 51st state. It would be called “Northern Colorado” and its capital would be Greeley.
The funny thing is that some analysts have determined that due to it’s potentially low population base and large infrastructure that taxes in Northern Colorado would probably end up being higher. There is also doubt that the University of Northern Colorado, which is located in Greeley, would be able to draw enough students from the new state (currently most come from the Front Range). Also, the new state would have to somehow compensate the old state for loss of property (like the University itself).
They’re just a bunch of sour grapes.
The equity locusts and coastal libtards will not stop moving here, changing the electorate and mucking things up with new gun laws, legalized dope, and civil unions for the homogays.
Bloomberg: Bootstrapping, Gritty, Bootstrapping Billionaire
Reptiles: MAF
($350k also isn’t that much for Bloomie, a drop in the bucket compared to having a brand new hospital wing and a graduate department at JHU with his name)
I give myself an F for this post for overuse of Bootstrapping. Then against, that was Mittens’ entire POTUS campaign theme, so it’s not like I’m the only one.
Bill O’Reilly got gaped by 2 military analysts last night. This is Must See TV:
http://www.youtube.com/watch?v=hj9Rxbp2ZS0&feature=youtu.be
It’s amazing. They explain it to him over and over and Bill is just stuck on stupid.
Bill OReally? I didn’t know he is still on TV.
What a racket….
he was really good on ‘inside edition’ back in the day
It’s funny, he’s a hero to the over-60 crowd but no one under 40 knows who he is.
Nobody wants to see that crusty old perv on their TV. Everybody wants to look at meeeeeeeeeeeee!
http://resources3.news.com.au/images/2013/08/28/1226705/385895-miley-cyrus-at-the-2013-mtv-video-music-awards.jpg
It is funny that O’Reilly is still taken seriously by reptiles despite the whole Andrea Mackris thing and the ugly divorce with his wife & him harassing her and her police officer husband.
LOL, just LOL, at partisan hacks who still watch O’Reilly. (I would say the same thing for Lawrence O’Donnell of MSNBC, btw, he’s not as dumb as O’Reilly but is just as disgusting a person.)
You guys with TVeees sure lead exciting lives!
I haven’t watched O’Reilly in years, I get my clips from the Daily Paul (Ron Paul themed website). Gives me something to do on the train or walking to work. LOL @ thinking that young people really watch TV in the sense that boomers do/did.
I’m not going to argue whether chemical weapons were in fact used, as I don’t have enough information. However, that does not seem to be a point of contention in this argument. It assumes they were used, so I will make that same assumption.
To answer the analysts questions:
1) Why do we want to stop our enemies fro killing each other?
Answer: We don’t. However, IF one of those enemies used chemical weapons, it is in our interest to discourage the use of such weapons in the future.
2) What national interest is at stake?
WMD have the real possibility of exterminating the human race. We, as human, have a vested interest in discouraging their use by ANYONE. That discouragement must come in the form of the cost being greater than the gain.
WMD only get used against people who can’t retaliate with WMDs.
My solution: Hand out WMDs to everyone.
Starting with what is left of what used to be the US Middle Class.
Which is exactly why we dropped the A-bomb on Japan after WWII was already over.
Chemical weapon is not WMD.
What happens when you turn over the vetting of intelligence analysts to private-sector, for-profit, bootstrapping, invisible hand of the free market, government contractors?
Abundant LOLZ:
“The most recent background check of former National Security Agency contractor Edward Snowden was so inadequate that too few people were interviewed and potential concerns weren’t persued, according to a federal review folling his leak of some of the nation’s most closely guarded secrets.
The background checkers failed to verify Mr. Snowden’s account of a past security violation and his work for the Central Intelligence Agency, they didn’t thoroughly probe an apparent trip to India that he had failed to report, and they didn’t get significant information from anyone who knew him beyond his mother and girlfriend, according to the review.”
http://online.wsj.com/article/SB10001424127887324906304579039381125706104.html
Contractors FTW baby. They (we) cost the gov’t so much it’s ridiculous, but thanks to lobbyists and campaign contributions, there’s an army of reptiles on Capitol Hill singing our praises. LOL, this country is screwed.
We’re still hiring. Just had another junior analyst start this week.
Got room for a pro housing analyst?
College graduates should not have to live out their 20s in their childhood bedrooms, staring up at fading Obama posters and wondering when they can move out and get going with life — Paul Ryan
Wall Street Journal - More Young Adults Live With Parents:
“The share of young adults living with their parents edged up last year despite improvements in the economy — a sign that the effects of the recession are lingering.
In a report on the status of families, the Census Bureau on Tuesday said 13.6% of Americans ages 25 to 34 were living with their parents in 2012, up slightly from 13.4% in 2011. Though the trend began before the recession, it accelerated sharply during the downturn. In the early 2000s, about 10% of people in this age group lived at home.”
http://online.wsj.com/article/SB10001424127887324906304579039313087064716.html
They should be worse off than that, so older generations can have it better.
– Paul Ryan based on what he does, not what he says.
I thought the reason we could enhance old age benefits for older generations and eliminate them for those under 55 is because younger generations have time to adjust. Well, they are adjusting.
Where are they going to get the money to live on their own, based on what Paul Ryan’s backers are paying them? Should they just borrow it?
I will ensure college graduates get jobs and get out of parents’ basement by bringing more labor competition (50 millions to be exact) in the market place.
–paul ryan
Labor competition? I thought we already had that: hordes of people fighting over the few good jobs left. The kids are playing XBox in the basement when they aren’t at their part time Lucky Ducky jobs because they lost the labor competition.
And paul ryan will make sure that there will be more competition on those part time lucky ducky jobs.
LOL XOX
The young pups voted in droves for bigger and bigger government and higher and higher taxes.
They are now getting a great lesson in “cause and effect”
What sounded so “kewl” in college is not so much fun when you have $100,000 in student loans and a minimum wage job after graduation.
Cause & effect was you and your Baby Boomer buddies screwing the country up beyond belief.
Trickle down, baby! Trickle down! Dereg and trickle down!
Don’t know of a single Gen X or Y who voted for that. Oh yeah, they were TOO YOUNG!
” higher and higher taxes.”
1) What higher taxes?
2) Because the Raygun legacy of lowing income taxes for the rich while raising payroll taxes on the poor, has worked out sooooooo well for me and my kids.
“They are now getting a great lesson in ’cause and effect’”
Correct. The cause is embracing trade imbalance via job offshoring and a WAY too flat tax code. The effect is a debt based economy that has hit the household debt limit.
What sounded so “kewl” in the 1980s, has resulted in debt increasing at 3x the sustainable rate for 30 years while household income has failed to keep up inflation until we ran SMACK into our debt carrying limit.
You’re arguing with 2Banana. It would be a better use of your time to argue with an actual banana. Or an apple. Pick your fruit, any piece of fruit.
I have found the intelligence of kiwis to be vastly underrated.
The Baby Boomers are the ones who designed the currently dysfunctional system.
Boomers just boomer-ing, man.
Boomers have stolen badly from Millenials and screwed up the economy in the process.
What you think we stole from you never existed.
I hate both the baby boomers and the millenials. Even if I could be considered one of the latter, I am an X’er in spirit.
I wish I was a millenial…just missed by couple of years.
I hate the xers…they are losers..I don’t want anything to do with them.
F’ them!
So, golden boy, what year were you born then? 1997?
I don’t mind being a millenial. Just having a career-type job among millenials seems to wow people.
Yes I am 16 and half. I promise you I will get laid by the time I am 17…..this time around.
I hate fruit that talks, no matter the age. I like my fruit to be silent and cold.
“Boomers have stolen badly from Millenials and screwed up the economy in the process.”
Just the leading edge boomers. The tail end boomers got screwed just as hard.
But hears the thing: they voted for, wait for it, wait for it…. aging Greatest Gen politicians and/or their polices.
THAT’S who really screwed us in the end.
Reagan? No boomer. Bush. Defiantly NOT a a boomer. Kissinger? No boomer. Rove? Rumsfeld? Cheney? Carter? Ford? Greenspan? None of them boomers.
So stop blaming all boomers. In the last 50 years, everybody of all ages but the lucky and already rich got screwed.
they voted for
I think in the end THAT is what later generations can blame earlier generations for. Who/what they voted for…
Can you think of an example of when you actually got what you thought you were voting for? Did those who voted for the current staff?
All valid points. But I suspect that history will judge poorly those who said “there were only two viable choices presented to me so I picked what seemed like the least evil one”. Even if that’s unfair.
There is not a single Democrat policy that the Republicans disagree with that has any bearing on the state of our economy at all. The Repubs are slightly more gung-ho about giving all the money to the rich right now. Other than that, both parties are free-trading corporate toadies. That, and also the Republicans are more comfortable appearing generally immature and nasty in public.
W! T! F!
the obama housing bubble v2.0 rolls on…in Palestine?
So glad we don’t need any of that money here at home.
——————-
U.S. Gov’t Funding $313M in Mortgages—For Palestinians on West Bank
CNS News - Terence P. Jeffrey - August 27, 2013
The U.S. government will fund $313 million in home mortgages for Palestinians living on the West Bank, according to a Government Accountability Office report released Monday.
The U.S. will also guarantee $110 million in loans to small- and medium-sized businesses located on the West Bank.
Palestine is in Africa. Obama was born in Africa. That’s why he wants to give American taxpayer dollars to pay those mortgages in Africa. And you’d have to blind, stupid, or both not to know where this all leads:
http://www.breitbart.com/Big-Government/2012/08/03/Obama-administration-paves-the-way-for-sharia-law
It amazes me HOW HARD people will work to be wrong.
Yesterday, we were trying to have a discussion around the demographics of Baby Boomer die off.
To see the effect on housing bubble formation vs. deformation, you have to look at 75 years olds and 20 year olds. 75 years old is when a generation’s great die off begins (household deformation). At 20 years old is when a generations begin moving out in huge numbers (household formation).
The talk of GenX and GenY is IRRELIVANT to the conversation on what will happen when the Boomers die, because those generations will have ALREADY formed households before the Boomers die.
Housing Anal pointed out that the 1946-1970 (25 year period of time) resulted in more babies in the USA than any other 25-year period.
When talking about the die off of that group, we have to look at the years when those people will be turning 75. That is, 2020-2045.
WHO is going to be turning 20, and forming households in the years 2020-2045? Right, the babies born between 2000 and 2025.
SO!!!!! To see what will happen with household formation and deformation in the years 2020-2045, you have to compare the number of births in 1946-1970 (3.9 million a year on average) and 2000-2025 (4.1 million a year, so far).
In short, for 35 million additional, empty excess houses to result from Boomer die off, there would have to be NO ONE under 10, and NO births for the next 13 years.
It simply amazes me how HARD some people will work at being ridiculously wrong.
Looking at total numbers alone is also laughable. Since I think the rise in population will be maily due to 2 things; 1. children born to poor parent(s) 2. Po immigrants
1. What kind of jobs these young people going to have? (think roommates)
2. How many of them are immigrants or children of immigrans? (think multi family housing and few SFH)
Are the boomers who are going to retire need to have someone else take their job?
Many won’t be fileld in, some will be offshored. If they hire, it will be a part time person. You have no clue comapnies are beeding money left and right for not having enough work for in many of their departments. Sadly, it’s also true that few of their departments have chronic shortage of workers.
Someone the other day on this blog said that the US-born population is increasing. That is incorrect. Population growth among US-born people has been zero for like a decade. Our population has only been growing due to immigration, and a lot of that is “illegal” (but openly allowed).
Amnesty for 30 million illegals will solve that problem alone.
75 is when die off begins? That’s higher than avg life expectancy for boomers.
At present, the average 65 year old man will live about another 20 years, the average 65 year old woman will live about 22 more years. You’re right in that the life expectancy when the boomers were born was less than 75.
We’re gonna be an old country for a while. Still way better than Japan’s or Europe’s demographics.
I know there’s an actuarial aspect to it, but are these people going to stay in their houses up until the day they die? And the dying will happen slowly, but in some sort of normal curve, right?
Or are Boomers going to keep themselves alive using SS and Medicare (plus Part D, thanks dumba*s Bush!) to live to 100 and just finish bankrupting the country?
i ain’t paying for that.
soylent green is the solution.
But we are paying for it, that’s the infuriating thing. Obviously a safety net is needed, but both parties pander to old people like crazy. Now the old age safety net is severly bloated, which drives up the cost of everything in our economy.
I know there’s an actuarial aspect to it, but are these people going to stay in their houses up until the day they die?
Since few will be able to afford nursing homes and their Lucky Ducky kids won’t be able to afford a house, I suspect many kids will end up living with mom and dad, caring for them and keeping the house after they’re gone.
“caring for them and keeping the house after they’re gone”
Except the house will have been reversed mortgaged to pay for healthcare costs.
The real trick is keeping the death of your parents a secret so that you can keep the house AND keep collecting their Social Security checks!
It’s a bit complex, but the reason Boomers have a lower average life expectancy than those only 10 or 20 years younger is childhood mortality.
Dying at 1 week old has a far more drastic negative effect on average life span than living to 80 does.
Childhood mortality rate for 1-4 year olds in 1946 was .25%. Now it is 0.25%.
For 5-14 year olds, it was .1%. Now it is .015%.
That decreased childhood mortality rate is a HUGE factor in the lower life expectancy.
If you were born in 1950, your life expectancy fro birth was 66. Now it is 76. So we’ve added 10 years.
HOWEVER, if you were 20 in 1970, your life expectancy was 71.
If you are 20 today, your life expectancy is 76, so only 5 years.
ALSO, household deformation occurs when the elder of the spouses occurs. If one spouse dies at 70, and the other at 80, the household deformation occurs at 80, not 75.
The lower childhood mortality rates today actually argues for higher formation than deformation as more boomers that were born didn’t make it to household formation age.
Sorry for the typo:
“Childhood mortality rate for 1-4 year olds in 1946 was .25%. Now it is 0.25%. ”
Should be:
Childhood mortality rate for 1-4 year olds in 1946 was .25%. Now it is .025%.
Thanks LBJ, thanks Clinton, thanks Obama
Washington Post - Fifty years after March on Washington, economic gap between blacks, whites persists:
“Even as racial barriers have tumbled and the nation has grown wealthier and better educated, the economic disparities separating blacks and whites remain as wide as they were when marchers assembled on the Mall in 1963.
When it comes to household income and wealth, the gaps between blacks and whites have widened. On other measures, the gaps are roughly the same as they were four decades ago. The poverty rate for blacks, for instance, continues to be about three times that of whites.”
http://www.washingtonpost.com/business/economy/50-years-after-the-march-the-economic-racial-gap-persists/2013/08/27/9081f012-0e66-11e3-8cdd-bcdc09410972_story.html
What about the wealth gap between the rich and poor blacks?
not everyone gets to be oprah or jay-z when they grow up
Neither most white gets to be the evil CEO of an insurance company.
Forward
“Only one in four African-Americans say the situation of black people has improved during Obama’s tenure, according to a new Pew Research Center poll.”
http://abcnews.go.com/Politics/march-washington-obama-legacy-civil-rights-spotlight-anniversary/story?id=20067008
I am surprised it is that high.
I thought so too. May be some blacks feel that they need to support Obama even if there life hasn’t changed a bit.
more librul lies:
‘obama conspiracy theories have flourished in the deep south, where wealth and educational levels are both low … voters in reliably republican states, which tend to be poorer, with lower test scores, are more vulnerable to misinformation. to use one measure, the 2011 national assessment of educational progress test of eighth-grade reading, all but one of the top 10 states were in obama’s column in 2012. of the 19 doing worse than average, 14 were red states.’
http://www.washingtonpost.com/opinions/dana-milbank-embracing-misinformation-on-obama/2013/08/27/bb73493a-0f4f-11e3-bdf6-e4fc677d94a1_story.html
deep south, where wealth and educational levels are both low … voters in reliably republican states, which tend to be poorer, with lower test scores, are more vulnerable to misinformation
I am sure writing a sophestry like this gets you compliments in DC. This idiot needs to look at the demograhics of the south a little closely. I am not sure he or she is ready for as Gore would say, the incovinient truth.
I expect nothing less from a region where Obama is blamed for Katrina.
Google “obama blamed for katrina”
Prepare for LOLZ.
There is a lot of racism in the south.
So is in north, east and west.
Most white people are racist.
Most
whitepeople are racist.When the chips are down, everybody is tribal.
True. Everyone is racist, but there is more open racism in the south.
25 MILLION excess, empty and defaulted houses CHECK
Housing demand at 14 year lows and falling CHECK
Housing prices inflated by 250% CHECK
Household formation at multi decade lows CHECK
Rampant housing fraud CHECK
Public denial formed and supported by a corrupt media CHECK
Population growth the lowest in US history CHECK
Immigration flat to slightly negative CHECK
Housing is a mess. Avoid it.
http://www.roflcat.com/images/cats/Haters_Gonna_Hate.jpg
The liars hate the truth don’t they?
Yes. Yes you do!
Back in your corner Darryl.
Cat photos never gonna be hated.
“Houses are rapidly depreciating asset no different that automobiles.”
Exactly. And the losses to depreciation are magnified tremendously when you finance a rapidly depreciating asset like a house for 30 years.
“Housing as a rental investment is a huge gamble considering it’s negative cash flow at current inflated asking prices of resale housing.
Beware.”
Exactly.
“Just for the record; there is no shortage of housing. Not in California, not in Tokyo, not anywhere. And there will come a day (again) when the media will tell us, ‘there’s a glut of houses for sale in….’, and regale us with sob stories, ‘I was doing great until the economy went south and my income went away and I can’t get rid of this damned house!’”
~Ben Jones, August 8, 2013
This notion of “a shortage of housing” is laughable considering there are tens of millions of excess empty houses in the US….. and growing by the day.
“Pending home sales fall 1.3% in July
http://www.marketwatch.com/story/pending-home-sales-fall-13-in-july-2013-08-28-109108?link=MW_latest_news
Number 1 selling month of the year and sales crater.
Of course… those who stand to benefit the most by skewing the numbers are the same people who are reporting said numbers. You can wager sales fell far far more.
Hope and Change:
“The number of households with at least one out-of-work parent soared by a third from 2005 to 2011, according to a new U.S. Census report on families and living arrangements.”
http://www.washingtonpost.com/blogs/govbeat/wp/2013/08/27/the-number-of-homes-with-an-unemployed-parent-rose-by-a-third-in-just-six-years/
You do realize that half of those years were under Bush, right?
Obama takes over of a plane heading for the ground, and pulls it out into a flat, if temporary, path.
The entire loss in altitude is then his fault?
Where we are is the direct result of 30+ years of BAD economic decisions, not 4.5.
But O was in senate I think. Every bad thing started happening after O gave that speech at that convention.
It was bad even before that. When he was Governor of Chicago with his cronies Saul Alinsky, Jeremiah Wright, Bill Ayers, John Wayne Gacy all running the show.
Bush was trying to save America and fight the terrists and all Obama ever did was to divide us and tear America down.
obama blamed for katrina
Yes, you can google it.
Got teabagger hypocrisy?
“The Republican-led Michigan state Senate voted to expand the Medicaid health program for low-income people, accepting a key facet of U.S. President Barack Obama’s health-care overhaul.”
http://www.bloomberg.com/news/2013-08-28/republican-led-michigan-senate-votes-to-expand-medicaid.html
“The deflationary spiral rages on…… whatever you do, stay out of debt and hold onto your cash.”
You better believe it mister.
“And don’t forget. The 82 million boomers that just began to die off own or did own 1.7 houses per paired couple. That’s alot of excess empty houses.”
BINGO… “vacation” houses are all owned by boomers.
I suspect that the vacation homes will be passed on to their heirs.
More likely, the vacation homes will be reversed mortgaged, then end up in the hands of the lender upon death.
Of course they will! It fits in with your corrupt narrative so conveniently.
In which case, their “heirs” won’t be buying any houses ever.
why big, intense wildfires are the new normal (because obama took all the money for firefighters and spent it on obamaphones)
‘wildfires are roaring through twice as many acres per year on average in the u.s. than they were 40 years ago … that number could very well double again in the next 30 years’
http://news.nationalgeographic.com/news/2013/08/130827-wildfires-yosemite-fire-firefighters-vegetation-hotshots-california-drought/
I remember reading an old National geographic stating that the temperature in the 20th Century was unusually mild and warning about the possibility that weather could return to more normal extremes.
It was all about the green revolution and the surge in crop production in the 1950’s and 1960’s.
I remember books warning about the coming ice age. Those were popular about the same time all the “Bermuda Triangle” experts were selling a gazillion books about alien abductions and psychic vortexes. Vrotaci?
Listing #13009435
$450,000 (LP)
Price/SqFt: 312.72
13144 E Millerton Rd, Moorpark, CA 93021 Pending
Beds: 3 Baths: 2 (2 0 0 0) (FTHQ) Sq Ft: 1439 Lot Sz: 4000sqft
Area: SMP Yr: 1982
The guy who got suckered into that one has a lifetime of debt service from which he’ll never recover.
Comment by Prime_Is_Contained
2013-08-27 21:30:18
[...]The thing that I think would be most interesting in an LPS report would be to see the average number of days to foreclosure go down. At the moment, they still seem be trending upwards at a rate of roughly 10 days per month.
Comment by Rental Watch
2013-08-27 23:16:27
PIC:
Are you referring to page 22, where they show the average days to foreclose being approximately 860 days?
Again, this is a byproduct of the judicial foreclosure process. If you want to “let them liquidate”, you need to change the laws in judicial states.
If you want to see more fun data, check out the FNM credit supplement: http://www.fanniemae.com/resources/file/ir/pdf/quarterly-annual-results/2013/q22013_credit_summary.pdf
RW, yes, I was referring to Page 23, entitled “Loan counts and
average days delinquent”. I’m skeptical of the explanation that this is simply an effect of the judicial foreclosure process, though.
Even the judicial process should not take 860 days. Further, why is the time-to-foreclose still rising, every single month, like clockwork? At some point, it should peak, at the time that it takes the average property to flow through the foreclosure pipeline. If they were prioritizing the oldest properties, I would have expected it to peak before now.
The only thing I can read between the lines is that the oldest properties are still not flowing out of the foreclosure pipeline. If not, why not?
Take a look at page 22. You’ll see how the Judicial states have very high delinquency and foreclosure rates, and non-judicial are much lower. Over the past couple of years, if you followed these numbers (which I did), you would see the non-judicial states slowly settle to the bottom of the rankings.
RealtyTrac shows the process for each state.
I’ll highlight only one…NYC. A judicial state…the timeline at best is 445 days, but it has to go through the court, so when the courts get jammed, this slows down.
Look at CA…a non-judicial state…about 150 days, no court involvement.
The other thing that I keep in mind is that there are some homes that have paperwork problems/lawsuits, etc., that might take a lot longer to resolve. As these increasingly become the last homes remaining, it could be that they are skewing the numbers upward.
In other words, as you clear the low hanging fruit (non-judicial and no problems), what is left looks worse and worse at an increasing rate. Simple example. A ten delinquent home universe: 3 are 100 days, 4 are 200 days and 3 are 300 days delinquent. No more are added. On that day, the average is 200 days delinquent.
Fast forward 100 days. Let’s say that 2 of the 100 days are in non-judicial states and are resolved, 3 of the 200 days are resolved, and only 1 of the 300 day delinquent was resolved. You are left with fewer homes in foreclosure, but a higher average of 325, even though only 100 days have passed.
What I’ve been paying attention do is page 22…the absolute amount of distress left in the system (delinquencies PLUS foreclosures), and the number of new homes entering various phases of delinquencies. The average days delinquent doesn’t say much about how certain markets are clearing the inventory of distress.
You mislead the readers here.
Why?
Because you have a stake in the direction of housing prices.
You have no credibility.
This Chrome broswer is really good at tracking me I see a Digi-Key ad at the top of the HBB page.
Windows explorer didn’t do this.
That’s why FireFox is the only way to go.
It comes standard with the best browser security and if that isn’t enough, there are some serious add-ons.
I CONTROL what I want to see and who can track me. When I get real paranoid, I’ll start using a proxy as well.
“When I get real paranoid”
I know who you are and I saw what you did
All your blog posts are belong to us.
I wonder if mozzilla uses firefox to collect data on users
What’s Digi-Key?
What’s Digi-Key?”
its where I buy all my stuff check it out
avnet.com has lower prices sometimes
Octopart?
Hi Combotech are you going to sell your stock now that these clowns are talking about it ? You are doubled since you brought it up earlier this year- good call
Summary
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“Hi Combotech are you going to sell your stock now that these clowns are talking about it?”
Nope, it’s a long-term hold; Very compelling fundamentals.
In general I am out of stocks, but now and then one comes by that is grossly mispriced - a “Special Situation” as Value Line would call it - and I am convinced that this stock is one of those.
Buffett says if he can get just one good stock idea a year then he will do well. QCOR is my idea for this year.
“You keep giving money to me, I keep giving money to you”: QRM rules loosened again.
US regulators soften risk retention rule on residential mortgages
By Tracy Alloway in New York
August 28, 2013 6:06 pm
US regulators have moved to boost the country’s housing recovery by softening new rules that would force banks to hold a slice of packaged mortgage loans.
Banks and other financial entities which bundle mortgages into “securitisations” will have to hold part of the final product under new rules aimed at avoiding a reprise of the recent financial crisis. Home loans that meet certain standards – known as “qualified residential mortgages” – are exempt from the risk retention rule.
http://www.ft.com/intl/cms/s/0/fa535f6e-0ff9-11e3-a258-00144feabdc0.html
How is politicians getting money from businesses to which they funnel public money not a kickback scheme?
Because the money goes to the reelection campaign, not them personally.
Helping your guy get elected, so he can hand you huge chunks of government generated debt/money is called Freedom of Speech.
The same way lobbying is not bribery and sitting on multiple corporate boards is not conflict of interest.
Duh.
/sarcasm
Human nature and all…
When buying and selling are controlled by legislation, the first things to be bought and sold are legislators.
–P. J. O’Rourke
Another “return to normal”: San Diego prices are rising faster than almost anywhere else because we are running out of land (again). The reality is that there is plenty of available land to build on, but it is tightly controlled and dribbled out in drips and drabs to keep new home prices on a permanently high plateau.
San Diego price appreciation has accelerated back to the peak bubble pace.
Home price gains in SD outpace U.S.
By Lily Leung
7:41 a.m. Aug. 27, 2013 Updated 11:51 a.m.
A new home in Carmel Valley. A new home in Carmel Valley. — Howard Lipin / Union-Tribune staff
The pace of U.S. home-price increases began to slow by mid-year but not in San Diego County, where values took their largest annual jump in more than eight years, the S&P/Case-Shiller Home Price Index showed on Tuesday.
San Diego home prices in June rose 19 percent from a year ago, which marks its largest year-over-year hike since March 2005. The latest data also shows San Diego is outpacing national home-price growth, which was 12 percent when tallying all 20 areas in the index.
This is often the storyline for supply-constrained counties like San Diego: A limited amount of land means a limited number of homes can be built, which tends to drive up prices, said Michael Lea, a real estate professor at San Diego State University.
“We have more land constraints than most other cities,” Lea added. Similar areas include Los Angeles and San Francisco.
…
where is all this available land to build on in san diego?
A lot of it is in the area between Black Mountain and Rancho Santa Fe. This land is earmarked for future development, but the pace of building has been glacial since the Fall 2008 financial crisis.
I can’t really provide a full overview of what areas around San Diego County are sleighted for future development; suffice it to say the percentage of developed land is a small fraction of the total.
The real question in SoCal: Where will they get the water for the millions more who will join the party?
Why build anymore considering there are 4 million excess, empty and defaulted properties in California alone??
At least California home prices have recovered!
Why are California cities in fiscal trouble?
August 28, 2013, 11:46 AM
By Alicia H. Munnell
My colleagues and I at the Center for Retirement Research are beginning a project to figure out why some localities are facing serious financial problems. Instead of reviewing the finances of the 2,400 cities and towns in the U.S. Census of Governments, we decided to search newspapers, magazines, wire services and other sources for cities or towns that have been cited in the press as financially troubled. Our search turned up 34 localities. Nine of those were tiny towns that had lost a major lawsuit. The other 25 localities had more pervasive problems, and included the expected larger suspects such as Chicago, Detroit, Philadelphia, and Providence, R.I. Others were small, like Prichard, Ala., and Central Falls, R.I. What I found astounding was that 10 of the 25 financially troubled cities were in California. I guess the bright side is that, excluding California, American cities are not about to topple over like dominoes. On the other hand, what is going on in California?
…
Oh boy, it’s time for Scott Pelley and the CBS evening propoganda.
SAN FRANCISCO (AP) — Williams-Sonoma said Wednesday that its fiscal second-quarter profit jumped nearly 13 percent as sales gained.
The high-end home goods retailer raised its full-year forecast based on the quarter’s results, but its profit outlook still fell short of market expectations, and shares fell in afternoon trading.
The San Francisco company, which owns Pottery Barn, Williams-Sonoma, Rejuvenation and West Elm, is benefiting from the housing recovery that has gradually taken root in many parts of the country.
Williams-Sonoma Inc. reported that it earned $48.9 million, or 49 cents per share, for the quarter that ended Aug. 4. That is up from $43.4 million, or 43 cents per share, for its second quarter last year. Its total revenue increased 12 percent to $982 million from $874 million.
The results beat market expectations. Analysts polled by FactSet, on average, were anticipating earnings of 47 cents per share on revenue of $938.9 million.
Credit reporting update will distinguish between short sales and foreclosures
by Kim Miller
A change in how distressed home sales are reported to federal mortgage backer Fannie Mae should make it easier for people who did a short sale to buy again faster.
Foreclosures are more financially damaging to a borrower’s credit than a short sale, but Fannie Mae didn’t have an automated way to differentiate between the two. This could be an especially important change in Florida where short sales made up 28 percent of all sales in June, according to RealtyTrac.
Typically, people who went through a foreclosure can’t buy again for seven years, while it’s just three years with a short sale.
Sen. Bill Nelson, D-Fla., held a congressional hearing on the issue in May, urging the lending industry to update computer software used to report the distressed sales.
“Regardless of the cause, I’m glad Fannie Mae is fixing the problem,” Nelson said. “You can’t punish homeowners who went upside down solely because of the economic downturn and loss of value in their home.”
The change should begin in November.
This entry was posted on Wednesday, August 28th, 2013 at 8:56 am and is filed under Florida economy, Foreclosures, Housing affordability, Housing boom. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
More Beat Cheese
Jacksonville-based bank to pay $43.3 million for foreclosure wrongdoing
by Kim Miller
There are more checks on the way to people who were in foreclosure in 2009 and 2010 as the Jacksonville-based EverBank agrees to hand out $37 million to wronged borrowers.
The Office of the Comptroller of the Currency announced the agreement late Friday. More than 32,000 people nationwide are eligible for the money, which will range from $1,050 to $125,000 per person.
Borrowers will be contacted by a third-party paying agent and can qualify for the money even if they didn’t apply to the Independent Foreclosure Review.
EverBank was subject to a cease and desist order for unsafe and unsound practices in mortgage servicing and foreclosure processing.
In addition to money paid by EverBank directly to eligible customers, EverBank will pay approximately $6.3 million to organizations certified by the U.S. Department of Housing and Urban Development or other tax-exempt organizations that have as a principal mission providing affordable housing, foreclosure prevention and/or educational assistance to low- and moderate-income individuals and families. Recipient organizations shall be approved by the OCC.
Last month, the OCC announced an agreement with GMAC Mortgage to provide $230 million to 232,000 borrowers nationwide.
This entry was posted on Monday, August 26th, 2013 at 7:31 am and is filed under Florida economy, Foreclosures, Housing affordability. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
This is but one of many sad aspects of cities in extreme states of decay.
Detroit grapples with stray dog epidemic
By Poppy Harlow and Sheila Steffen, CNN
updated 1:36 AM EDT, Thu August 29, 2013
Stray dogs an epidemic in this U.S. city
STORY HIGHLIGHTS
* Tens of thousands of stray dogs roam the city’s streets
* Owners, struggling amid the financial crisis, have been forced to abandon pets
* Seventy percent of strays taken in will be euthanized within a week
Detroit (CNN) — Nineteen-year-old James Johnson found a young pit bull puppy running up Seven Mile Road in Detroit this week. He took her in and named her Trina.
It’s not the first stray dog Johnson has found on the streets of Motor City. Four years ago, he found an emaciated pit bull he named Campsite hiding beneath a trailer.
In America’s biggest bankrupt city — currently more than $18 billion in debt and home to 70,000-plus vacant structures — there is another problem: Tens of thousands of stray dogs roam the streets.
As many of Detroit’s residents struggle to get by, many of its dogs are left abandoned — scavenging for food wherever they can find it.
The problem isn’t a result of the city’s bankruptcy filing. In fact, it’s been a vicious cycle in this city for decades. As the economy sputtered in Detroit and manufacturing jobs disappeared, more dogs were abandoned. They’re starving not just for food, but for affection.
“They’re over-breeding. They’re running the streets,” says Kristen Huston from All About Animals Rescue, whose mission is keep dogs in their homes or to otherwise prevent them becoming homeless.
“A lot of people have lost their homes, lost their jobs and they just don’t have the funds,” she says. “They love their animals but it’s very hard to feed their own kids and family.”
…