Bits Bucket for September 8, 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.
About Me
Name:Ben Jones
Location:Northern Arizona, United States
To donate by mail, or to otherwise contact this blogger, please send emails to: thehousingbubble@gmail.com
PayPal is a secure online payment method which accepts ALL major credit cards.
Links
-
December 2024 M T W T F S S « Sep 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31
Photo Submission: hbbphotos@gmail.com
View the HBB Photo Gallery *updated 4/13/2008
Total credit market debt owed in the United States versus its GDP
http://research.stlouisfed.org/fredgraph.png?g=mbO
Tentative conclusion: Since 1980, TCMDO grew much faster than GDP grew, as did housing prices.
It seems like the unhinging started around 1970, roughly when the U.S. dollar was taken off the gold standard.
Is the timing coincidence? And is the divergence sustainable? Time will tell…
“It seems like the unhinging started around 1970, roughly when the U.S. dollar was taken off the gold standard.”
Wasn’t the rice supposed to pay for the Vietnam war?
#Igotyourhashtagrightherepal
Are you ok today Ol’ Barbara?
youcanrunbutyoucan’thide
#neverjudgesomeonetillyou’vewalkedamileintheirshoescause thenyoureamileawayandyouvegottheirshoes
One of Janet’s finest keeping us all safe from those domestic terrorists. No more hesitation! Even if they are unarmed and driving away in a parking lot.
Posted: 5:11 p.m. Saturday, Sept. 7, 2013
Boca Raton road rage incident ends with shot fired by off-duty Homeland Security agent
By Joe Capozzi and Daphne Duret
Palm Beach Post Staff Writer
BOCA RATON —
An off-duty Department of Homeland Security agent fired a shot at another car in the parking lot at Town Center of Boca Raton after a road rage incident on Glades Road, police said.
No one was injured in either the road rage incident or by the gunshot, police said.
The agent, who was not identified, told police he was driving east on Glades Road in the 6000 block with his wife and three children in the car when he was cut off by a red car around 1:30 p. m.
The driver of the red car drove into the Nordstrom’s parking lot where he parked in front of the store to pick up another passenger. The off-duty agent parked in front of the red car and exited his vehicle with his wife.
When the off-duty agent approached the red car, the driver drove off, possibly hitting the agent and/or the agent’s wife, police said. The agent fired one shot at the car, striking the rear quarter panel, police said.
The driver of the red car drove home to Pompano Beach and called his wife, who then called 911. A short time later, the driver of the red car came back to the scene and is cooperating with detectives.
Mark Economou, department spokesman, said the investigation is very preliminary. The names of the parties involved will be released after statements and other evidence is collected. Anyone with information about the incident is asked to call detective Ron Mello at 561-620-6286.
Shoppers at the mall, on Glades Road west of Military Trail, said crime scene tape was still up in the area outside the Nordstrom department store Saturday afternoon.
So who REALLY owns your house?
—————–
Man owed $134 in property taxes. The District sold the lien to an investor who foreclosed
Washington Post - 08 SEP 2013
On the day Bennie Coleman lost his house, the day armed U.S. marshals came to his door and ordered him off the property, he slumped in a folding chair across the street and watched the vestiges of his 76 years hauled to the curb.
Movers carted out his easy chair, his clothes, his television. Next came the things that were closest to his heart: his Marine Corps medals and photographs of his dead wife, Martha. The duplex in Northeast Washington that Coleman bought with cash two decades earlier was emptied and shuttered. By sundown, he had nowhere to go.
All because he didn’t pay a $134 property tax bill.
“All because he didn’t pay a $134 property tax bill.”
Why didn’t he pay it…on time?
Why do Washingtonians get to enjoy so many taxpayer-funded freebies and this guy gets to lose his house?
They “deserve” freebies galore. This guy “deserves” to lose his house.
No, I don’t know any of the particulars….but this story comes out of elitist Washington is interesting. Interesting, but not surprising.
Good job, Washingtonians. Enjoy your freebies knowing that some guy lost his house for $134.
There is usually a whole lot more to a story like this than ‘he missed a bill and lost his house’. It is not impossible, but it is never that simple.
And there is no way the house was sold to a bona fide, arms-length purchaser for just $134.
There is usually a whole lot more to a story like this than ‘he missed a bill and lost his house’. It is not impossible, but it is never that simple.
Really? What is it? I believe the story because US government has killed people for less.
The fact that they would doesn’t prove that they did.
Almost certainly true. Maybe the guy is a serial tax evader. Maybe not.
While this guy may very well be at fault, there also is culpability among those who get freebies at taxpayer expense.
The two are not unrelated, either figuratively or literally.
“There is usually a whole lot more to a story like this than ‘he missed a bill and lost his house’. It is not impossible, but it is never that simple.”
The retired Marine sergeant lost his house on that summer day two years ago through a tax lien sale — an obscure program run by D.C. government that enlists private investors to help the city recover unpaid taxes.
For decades, the District placed liens on properties when homeowners failed to pay their bills, then sold those liens at public auctions to mom-and-pop investors who drew a profit by charging owners interest on top of the tax debt until the money was repaid.
But under the watch of local leaders, the program has morphed into a predatory system of debt collection for well-financed, out-of-town companies that turned $500 delinquencies into $5,000 debts — then foreclosed on homes when families couldn’t pay, a Washington Post investigation found.
Tax lien purchasers have foreclosed on nearly 200 houses since 2005 and are now pressing to take 1,200 more, many owned free and clear by families for generations.
Investors also took storefronts, parking lots and vacant land — about 500 properties in all, or an average of one a week. In dozens of cases, the liens were less than $500.
Coleman, struggling with dementia, was among those who lost a home. His debt had snowballed to $4,999 — 37 times the original tax bill. Not only did he lose his $197,000 house, but he also was stripped of the equity because tax lien purchasers are entitled to everything, trumping even mortgage companies.
“This is destroying lives,” said Christopher Leinberger, a distinguished scholar and research professor of urban real estate at George Washington University.
Officials at the D.C. Office of Tax and Revenue said that without tax sales, property owners wouldn’t feel compelled to pay their bills.
In a 10-month investigation, The Post chronicled years of breakdowns and abuses in a program that puts at risk one of the most fundamental possessions in American life.
•Of the nearly 200 homeowners who lost their properties in recent years, one in three had liens of less than $1,000.
•More than half of the foreclosures were in the city’s two poorest wards, 7 and 8, where dozens of owners were forced to leave their homes just months before purchasers sold them. One foreclosed on a brick house near the Maryland border with a $287 lien and sold it less than eight weeks later for $129,000.
•More than 40 houses were taken by companies whose representatives were caught breaking laws in other states to win liens.
•Instead of stepping in, the D.C. tax office created more problems by selling nearly 1,900 liens by mistake in the past six years — even after owners paid their taxes — forcing unsuspecting families into legal battles that have lasted for years. One 64-year-old woman spent two years fighting to save her home in Northwest after the tax office erroneously charged her $8.61 in interest.
http://www.washingtonpost.com/ -
A person with dementia and a $200000 asset that doesn’t have anyone to look out for him will end up without the 200k.
Wow. Just wow.
“Instead of stepping in, the D.C. tax office created more problems by selling nearly 1,900 liens by mistake in the past six years — even after owners paid their taxes — forcing unsuspecting families into legal battles that have lasted for years. One 64-year-old woman spent two years fighting to save her home in Northwest after the tax office erroneously charged her $8.61 in interest.”
Thanks for the extra info., phony. I am increasingly under the impression that the best thing for most people to do in this society is to drop out it.
Domestic Imperialism. Gotta remember to change my screen name to that. Neocons=Progressives, while correct, only identifies the elitists as they area, not the end result of their disgusting behavior.
“A person with dementia and a $200000 asset that doesn’t have anyone to look out for him will end up without the 200k.”
“I’m from the government, and I’m here to help.”
It is to be expected in a land where law trumps ethics and morality.
What our law-breaking/law ignoring leaders don’t foresee is that right now they are behaving in ways that will force a reversal of today’s Law trumps Ethics ethos.
Law never trumps ethics in freedom-loving countries.
One can argue that people in this country no longer love freedom. But 20 years hence, they will. It’ll be the next rebellious generation’s mission. Their goal in life.
$8.61 in erroneously charged interest. Two years of legal battles result.
“I’m from the government, and I’m here to help.”
Another example of the havoc bureaucracies bring. Yet so many people think more government bureaucracy is the answer to the everything. The government is largely responsible for the excessively high cost of health care. What’s the best way to solve that problem: more government. Obamacare increase the demand for health care buy subsidizing it even. But nothing is done on the supply side.
In Ca for example, prop taxes don’t become auction triggers for 5 years. Ample time to repay the back taxes.As others stated, doesn’t pass the smell test.
Seems unjust, particularly when one considers how many freebies many Washingtonians get to enjoy at taxpayer expense.
Was the guy a government employee?
A shame I didn’t know about this guy. I would’ve spotted him the $134 myself.
the program has morphed into a predatory system of debt collection for well-financed, out-of-town companies….
“Seems unjust”
Yes. Corporatism is unjust.
….particularly when one considers how many freebies many Washingtonians get to enjoy at taxpayer expense.
Yes. Our tax dollars should not be used to fund financial predatory corporatism.
‘Our tax dollars should not be used to fund financial predatory corporatism.’
If you really believe that, you should oppose Obama on this:
http://www.flushthetpp.org/
Agreed. And that includes Freddie Mae/Freddie Mac, ObamaCare/Single-Payer, the EPA, NSA, DEA, etc.
In a land where Neocons=Progressives, all is corporatism.
The government is there to help you…..
help evict you from your own home…..LOL
“… from your own home…”
Not anymore.
“So who REALLY owns your house?”
Sounds like your point is that, as the landlord who ALWAYS collects rents (or keeps a running tab of what’s owed) and can forcibly evict if the rent is not paid, the government is the real owner.
Nobody ever “owns” their house. At best, you are paying ever-increasing taxes to the government in order to hang onto it.
Anyone remember obama shutting down White House Tours because the government didn’t have any money?
————————–
How Much Will a War With Syria Cost?
The Motley Fool | September 7, 2013 | By Katie Spence
Before the missile strike on Syria became an issue, the Navy’s USS Nimitz, and its escorts, were scheduled to return from deployment. Now, however, they’ve been ordered to remain within striking distance of Syria, which alone costs an estimated $25 million per week. Further, each Tomahawk cruise missile likely to be fired on Syria costs an estimated $1.5 million each to replace. That’s great news for Raytheon (NYSE: RTN) , which builds the missile, but not for the Navy’s budget. Plus, if the U.S. fires missiles, that’ll add an additional $30 million per week for as long as the Navy’s Nimitz and Truman are engaged in combat.
Those costs may not seem like much when you factor in overall defense spending, but thanks to the nature of sequestration, the Navy, as well as the rest of the military, is hurting. For example, Chief of Naval Operations Admiral Jonathan Greenert, stated that for FY2014, the Navy needs more than a billion dollars more for “operations and maintenance” and a billion more for “procurement accounts”
High-Level U.S. Intelligence Officers: Syrian Government Didn’t Launch Chemical Weapons
http://www.zerohedge.com/contributed/2013-09-07/high-level-us-intelligence-officers-syrian-government-didn%E2%80%99t-launch-chemical- - 163k -
I have no idea what the truth is, but this sure smells like the Iraqi “weapons of mass destruction” BS. Our country has been hijacked by economic and political terrorists.
I am surprised you don’t like this war. Isn’t it a good time to sing your patriotic songs and wrap yourself in the red, white and blood?
You mean Bilderberg bood, right?
John Kerry Calls Bilderberg Protesters ‘Hoodlums’ - YouTube
http://www.youtube.com/watch?v=GEbOo3uokDA - 126k - Cached - Similar pages
Mar 12, 2013
…remember obama….
I like President Obama because he occupies so much of your free time 2banana. (Especially on Sundays.)
The real question is while I be able to blame obama almost 6 years into the next republican presidency for all the ills of the world and for all the missteps and failed opportunities…
And will you agree with that logic when it happens?
You’ll probably be too busy bashing the next Dem prez, who will be just as lousy as Obama but will be elected because the GOP will once again nominate an unelectable candidate to appease voters like yourself.
FWIW, the Bush bashing, except for the wars he started, has been over for a long time.
You’ll probably be too busy bashing the next Dem prez, who will be just as lousy as Obama but will be elected because the GOP will once again nominate an unelectable candidate to appease voters like yourself.
lol- exactly. Toobananas is gonna hate President Hillary almost as much as PBear will.
(Will) I be able to blame obama almost 6 years into the next republican presidency…..?
I don’t know. I don’t know how old you are. The USA might not see 6 years into a Repub presidency for awhile.
Nowadays, your once proud party is just too whacked-out to win many national elections.
Besides, USA’s issues are mainly economic caused by implementing the mostly Repu failed ideas of trickle-down, supply-side, free-trade, offshoring, TaxCutsforTheRich tripe.
With a Repub House and/or 60 votes required in the Senate, there’s not much Obama can do to change much of the above. This is why Obama, 5 years into his presidency, gets a pass from a lot of thinking people.
Not much you can do with your posts here either. So you should just not do anything. Just give up. Stop posting. It’s useless. You are powerless because a bunch of Republicans can block anything from happening in the senate.
Oh wait. I guess neither of our arguments pass the smell test do they?
I guess neither of our arguments pass the smell test do they?
Mine do. Yours didn’t.
The problem is the Republicans only offer Religiocrits such as Texas Governor Perry or the Pennsylvania guy Sanborn, or “progressive” wispy washy types such as McSame. They bury the only viable ones such as Ron Pail. The Republican Party is a “looser” party.” put a fork in it. Of course I am certainly no Dumbocrap.
My favorite Obamaism is his wanting the rich like him to pay more taxes. But like Warren Buffett and other limousine liberals they don’t put their money where their mouths are. Still waiting for their contributions to the treasury. Another favorite Obamism was his wanting to reduce the amount of deductions businesses can claim for corporate jets. Got the punish the evil business people. All the while Obama jets around the country and world on Air Force One for photo ops on the taxpayer’s dime. Liberals just can’t stand business and business people but are the first in line to spend the money they make. Kinda of what you would expect from a community organizer who wants to force socialized medicine on everyone But he (like Saint Hillary) won’t even allow the government to teach reading and writing to his kids. They go to private school. If they went to the public school they might rub shoulders with poor black kids. Can’t have that. Eeewwww!
Still waiting for their contributions to the treasury.
This is a meaningless AM radio talking point. Do the math. A few rich people voluntarily paying more in taxes is a drop in the bucket compared to the revenue of our past history of a more progressive tax system.
Liberals just can’t stand business…
Another overused talking point. There are just as many “liberal” business people as there are “conservative”.
Another overused talking point. There are just as many “liberal” business people as there are “conservative”.
Agreed. I find amusing the notion that unless you are a bootlicker for the 0.01% that you are somehow a Communist.
All the while Obama jets around the country and world on Air Force One for photo ops on the taxpayer’s dime.
Oho! Brilliant point! The President flies around for free, why shouldn’t corporate boards get to write off their private jets?
So many defenders of the one. The point is not that you can tax the rich enough to make a significant difference, you can’t their are n’t enough of them. The point is the utter and complete hypocrisy. Let the one lead by example and pay more taxes before raise them on the rest of the taxpayers. He wants to force people into government run health care let him at least send his children to public school. The let him pay for some of his jet setting or telecommute. Telecommuting would be greener. He’s a typical limousine liberal. All animals are equal. But some are more equal.
He wants to force people into
government run health carenot being deadbeats and taking personal responsibility for their healthcare.The point is not that you can tax the rich enough to make a significant difference,
BS. Your math is wrong. In fact, you have no math, just faulty rhetoric. The BushTaxCutsForTheRich contribute a to huge percent of our deficits.
1. The Bush Tax Cuts Are Costly
http://www.cbpp.org/cms/?fa=view&id=3873
…the (Bush) tax cuts have been a key driver of the federal deficit and will account for $4.5 trillion in deficits over the 2009-2019 period if extended….Continuing the Bush tax cuts would add trillions more to deficits…. the Bush tax cuts provide much larger benefits for high-income people than middle-income people
….The high-end tilt of the Bush tax cuts has contributed to the stunning increase in income inequality in recent decades,
High-income households can afford to contribute more to deficit reduction, and the tax code is the principal mechanism through which they can make that contribution.
Some claim that allowing the high-income Bush tax cuts to expire would slow economic growth and job creation. These arguments echo those made against President Clinton’s proposed 1993 tax increases, which set marginal rates at the levels to which they are set to return when the Bush rate cuts expire. As it turned out, however, job creation and economic growth proved significantly stronger following the 1993 tax increases than following the 2001 Bush tax cuts, as the fifth chart shows.
The Fed Has Wasted Trillions and the US Remains in Depression
Submitted by Phoenix Capital Research on 09/06/2013 11:00 -0400
The facts are now becoming abundantly clear, that the forecast we’ve maintained for well over two years has been validated: the US is in a DE-pression and both Washington and the Federal Reserve have wasted trillions of Dollars.
The reality is that what’s happening in the US today is not a cyclical recession, but a one in 100 year, secular economic shift.
http://www.zerohedge.com/contributed/2013-09-06/fed-has-wasted-trillions-and-us-remains-depression - 127k
“The reality is that what’s happening in the US today is not a cyclical recession, but a one in 100 year, secular economic shift.”
“A one in 100 year, secular economic shift”, aka a Fourth Turning.
The generation that enjoyed the Third turning is, as of now, handing the baton over to the next generation who will have to endure the Fourth Turning.
The Third Turning generation - the generation that enjoyed the benifits of debt expansion - is being hosed for the same reason that if prospered, which is debt expansion.
The Fourth Turning generation is slowly learning from the Third Turning generation (by observation rather than by example) that debt sucks and cash is king.
The First and Second Turning generations (30-year-old+ adults from 1950-1990) made hay off the debt explosion. Lots of it.
Their legacy is generations of children and grandchildren who get to pay for their recklessness and selfishness.
“…who get to pay for their recklessness and selfishness.”
Your strawman personification of the older generation as an individual decider who plans to deliberately screw posterity through reckless borrowing is off the mark. I realize this is a popular and often-repeated perspective, so it is not surprising to see it parroted here.
Yet it’s also true.
It is also not surprising to those who prospered via cross-generational theft to dismiss today’s reality as so much “strawman personification”.
It isn’t strawman personification. You only wish it was.
Your strawman personification of the older generation as an individual decider who plans to deliberately screw posterity through reckless borrowing is off the mark
I was never invited to the meetings where we all decided to screw the next generation.
Funny, your generation is the same generation that passed ObamaCare without public meetings.
Funny that a generation that prides itself on past protests allows such things to happen, then denies that it does so.
your generation is the same generation that passed ObamaCare without public meetings….then denies that it does so.
No public meetings? You are denying the reality.
During the August 2009 summer congressional recess, many members went back to their districts and entertained town hall meetings to solicit public opinion on the proposals…..
…the Senate Finance Committee held a series of 31 meetings to develop of a health care reform bill. This group ….met for more than 60 hours, and the principles that they discussed, in conjunction with the other Committees, became the foundation of the Senate’s health care reform bill.[56] The meetings were held in public and broadcast by C-SPAN and can be seen on the C-SPAN web site[57] or at the Committee’s own web site.[58]
….. The (Obamacare) idea goes back as far as 1989, when it was initially proposed by the politically conservative Heritage Foundation as an alternative to single-payer health care.[35] It was championed by many Republican politicians as a market-based approach to health-care reform, on the basis of individual responsibility:…
….Republican Senators, including those who had supported previous bills with a similar mandate, began to describe the mandate as “unconstitutional”. Writing in The New Yorker, Ezra Klein stated that “the end result was… a policy that once enjoyed broad support within the Republican Party suddenly faced unified opposition.”[38] The New York Times subsequently noted: “It can be difficult to remember now, given the ferocity with which many Republicans assail it as an attack on freedom, but the provision in President Obama’s health care law requiring all Americans to buy health insurance has its roots in conservative thinking.”[ wiki
I’m not denying any reality.
Does the phrase “We had to pass it so we could see what’s in it” ring a bell?
Was it presented on television to the American people by Obama?
Were they given a chance to chime in once they learned what was in it?
The American people were hoodwinked by the community organizer and his Neocon-Progressive handlers. Accept it.
Was it presented on television to the American people by Obama?
You are again denying the reality in the face of facts because of your politics.
Obama constantly talked about health-care reform during his campaign. He gave countless speeches addressing his health-care plan after he was elected. Over 60 hours of Senate hearings on it which included many members “the public” were on TV and the internet and there were dozens of public meetings with the public’s Representatives.
What parts of this can you deny?
The American people were hoodwinked by the community organizer
Americans were not hoodwinked. Obama and the Democrats passed a monumental Republicanesque health-care bill that will improve the lives of millions of Americans. Nothing is free. The bill is not perfect but it is a step in the right direction and makes America less barbaric.
Accept it.
“I was never invited to the meetings where we all decided to screw the next generation.”
To hear MacBeth tell it, you’d get the impression that there was this one guy, who represents all of the Greatest Generation, who decided to pursue an ‘eat the young’ economic policy…
who represents all of the Greatest Generation
I assumed he was talking about the Boomers:
” a generation that prides itself on past protests”
The American people were hoodwinked by the community organizer and his Neocon-Progressive handlers. Accept it.
+1 Agreed.
people were hoodwinked by the community organizer …….+1 Agreed.
You two were obviously not paying attention to the history-in-the-making.
Maybe you two were too lazy, or thought the Dems would lose, or the reality conflicted with your ingrained dogma.
Yep. EVERY ONE of those 30+ people from 1950 to 1990 made hay and did not pay their dues. If you believe Macbeth, I have a bridge I want to sell you.
Nobody said that. I certainly didn’t.
Generationally, Boomers certainly made hay. Especially the older half.
That you can’t accept that isn’t because I’m mistaken.
It’s one thing to take advantage of a situation and quite another to cause it.
“Taking advantage of a situation”.
Everyone else is doing it, so why shouldn’t I? It’s legal, therefore it’s ethical. Isn’t that the common refrain?
Yet some honesty for a change. Good. Nice to see it. A genuine thanks, In Colorado.
Anybody else care to be honest?
Just to put some context into what I said: If you have the opportunity to get a good paying job, why wouldn’t you? I fail to see how that is immoral, unless the job itself is immoral.
But you imply that everyone, or at least the majority of a certain generation, somehow conspired to screw the next generation. Having a good job or selling your house at a profit at a market price hardly seems like a conspiracy.
As for what our elected officials do, since when do they act in our interests? You’re blaming the wrong people. And contrary to popular belief, most boomers don’t have cushy jobs or pensions waiting for them.
‘The Fourth Turning generation is slowly learning from the Third Turning generation (by observation rather than by example) that debt sucks and cash is king.’
The middle class krill is dying off.
X’ers are toast. What is rather unexpected to me is the grave extent to which the Millenial generation is toast as well. I knew it’d be bad for them, but not this bad.
They may have stood a better chance if all had been allowed to collapse in 2008. Oh well.
With a government that insists on establishing and perpetuating fraud, it is to be expected.
They may have stood a better chance if all had been allowed to collapse in 2008. Oh well.
In the end, lots of things would have been better if we had taken our medicine then. And not because we want collapse, but because the longer we put off the consequences the worse they get.
100% agreement with you, Carl.
What people tend to focus is on the financial carnage only. There’s the psychological damage, too.
The question there is whether the psychological damage would have been more severe and long-lasting had collapse been allowed to happen, or whether it’d be greater in the extended-bleed scenario we find ourselves in.
Sorry, I’m an “X’er” and I’m not toast.
X’ers are toast. What is rather unexpected to me is the grave extent to which the Millenial generation is toast as well. I knew it’d be bad for them, but not this bad.
They may have stood a better chance if all had been allowed to collapse in 2008. Oh well.
How would it have been better? We already offshored all the jobs. Would an economic collapse somehow have brought them back? Don’t get me wrong, we need to take our medicine, but I don’t share the dogmatic belief that somehow we would have risen from the ashes of a collapse.
I think if we had truly let it all collapse, we would have ended up with either a more socialist system, or a more fascist one.
The least likely outcome would be a more libertarian system.
Which is ironic, because they’re probably the ones most calling for allowing a collapse.
?They may have stood a better chance if all had been allowed to collapse in 2008. Oh well.
How would it have been better?
This is a good question. Another one is, “What do you mean when you write all, and what would that involve? Do you mean even higher levels of unemployment and all of the things that go with it, such as couples divorcing and families going bankrupt and becoming homeless?
and all of the things that go with it, such as couples divorcing and families going bankrupt and becoming homeless?
If history is any guide (or poet) it would involve something along the lines of democracies falling and becoming more fascistic and/or socialist, and a worldwide deflationary spiral that would seem endless, except in countries which cured it with the “magic” of authoritarian rule and war preparation.
“The Fed Has Wasted Trillions and the US Remains in Depression”
At least they successfully made housing prices go up!
homes and stocks will make u a wealthy man. forget punchn that time clock. All you need is to do is buy assets and watch your wealth grow from a couch.
“All you need is to do is buy assets and watch your wealth grow from a couch.”
And then you can do some Couch Fishing!
Beavis Butt-Head in Couch Fishing! - YouTube
http://www.youtube.com/watch?v=QByTkyp-9AM - 145k -
Oh yeah…
And oil, too. We just need to get back to $147 per barrel. It’s so good for the eCONomy.
Coming soon to other places in the world…
Freezing in the dark while paying enormous taxes for the privileged of doing so.
——————
Australia liberated from their long national green nightmare
Watts Going On | 9/8/13 | Anthony Watts
Today is a great day not only in Australian history, but also in world history. It marks the day when people of character and sensibility pushed back against an overwrought and pointless green agenda, and pushed back in a big way. They’ve had enough, and they’ve scraped the Krudd off their shoes and are moving forward.
Tony Abbot has won the Australian election in a landslide, and vows to abolish the carbon tax as a first order of business. Abbott has declared Australia is “once more open for business” in claiming victory in Saturday’s election.
It is a huge blow to the Rudd-Gillard labor party and their green goals, which were built on a lie foisted on the Australian people. In 2010 when Gillard said “no carbon tax” in a videotaped speech that has been seen as the key moment Australians lost trust: snip
Then, shortly after she was elected prime minister, she acted as if those words were never spoken, and implemented a carbon tax anyway. There’s nothing worse than a liar who is oblivious to their own lies, and in my opinion, this was the catalyst that set the stage for the end of labor’s green dream as well as their dominance in government.
”The essential point is, this is our country and we determine who comes here,” Mr Abbott said.
Read more: http://www.smh.com.au/federal-politics/federal-election-2013/tony-abbott-evokes-john-howard-in-slamming-doors-on-asylum-seekers-20130815-2rzzy.html#ixzz2eJOKlXDH
Good for him. Hope he means it. I wish one of our politicians would say the same.
Australians Dump Agenda 21 Carbon Tax
Jul16
Written by Chriss W. Street
As an out and proud member of the Fabian Society, Australian Prime Minister Julia Gillard sought to advance the collectivist state by implementing the gradualist reform of the United Nation’s Agenda 21. But once the public was exposed to the crushing costs, job destruction and loss of personal freedoms of environmental totalitarianism, Ms. Gillard was dumped on June 26th as too liberal for her own Labor Party.
Julia Gillard made a name for herself in Australia Fabian circles as an editor and of the Socialist Forum, where she published a series of extremist policy strategies to consolidate control of the economy. “The Greening of the Red” laid out the blueprint for the left-wing to gain totalitarian control via environmental activism, calls for re-regulating the exchange rate, reintroducing tariffs, and reducing imports and foreign investment. The Australian media talked about how Ms. Gillard was winning the hearts and minds of middle class Australians. The notoriety powered her election to Parliament in 1996. In 2010 she organized a palace coup within her own Labor Party in 2010 that allowed her to snatch the Prime Ministership from her fellow party member, Kevin Rudd.
In her 2010 Australian election campaign, Gillard pledged to build a “national consensus” for a carbon price by creating a “citizens assembly”, to examine “the evidence on climate change, the case for action and the possible consequences of introducing a market-based approach to limiting and reducing carbon emissions.” But once elected she passed a $7.5 billion fixed-price carbon tax on 500 utilities, transportation and mining companies, with proceeds spent on new welfare payments.
Inflation took off, investment shrank and unemployment went to double digit. On June 26th, Kevin Rudd organized a counter palace revolt and took the Prime Ministership back from Gillard. The new Prime Minister announced: “The government has decided to terminate the carbon tax to help cost of living pressures for families and to reduce costs for small businesses.” Irate Australians wanted elimination of all costs associated with Agenda 21. So far, Rudd has offer to switch to a CO2 emissions trading scheme that will save an average household $350 a year due to lower gas and electricity bills. He said the revenue shortfall will be covered with federal budget cut of $3.5 billion
The public figured out the Fabians’ Agenda 21 strategy and probably knocked it down for a bit in Australia. But the Agenda 21 scheme of gradualist reform toward collectivism is alive and growing in most of the world.
http://www.chrissstreetandcompany.com/2013/07/australians-dump-agenda-21-carbon-tax/ - 53k -
This is criminal.
A good-hearted, deserved, suppressed woman tossed out of office by old white males.
I guess it really is true that the United States no longer wields the influence it once did. If we had any real pull, this never would have happened.
Well that is refreshing. Although I sympathize with ZPG and conserving the wilderness (through voluntary private contributions to buy wilderness).
There is no guarantee that wilderness purchased to be conserved will not later be sold to the highest bidder.
There are no guarantees about anything.
Already half way to government run socialized medicine…
Why are not you guys happy?
50 years ago people paid for their own kid’s births themselves and they could afford it.
Government “help” and regulations have push the hospital costs out of reach for most people.
Forward.
—————-
Nearly Half Of U.S. Births Already Covered By Medicaid
Medical Daily | September 8, 2013 | By Matthew Mientka
A new analysis of federal health data shows that Medicaid paid for nearly half of all births in the United States in 2010, a rate that continues to increase.
The federal health care program covered 48 percent of the 3.8 million births that year, jumping from 40 percent in 2008, say researchers from the George Washington University School of Public Health. In only two years, the government entitlement covered 90,000 more women giving birth, as states expand the federal-state health coverage plan.
So, you’re blaming expensive medical care on poor people?
I seem to recall reading on this blog that the Medical Industrial Complex hates Medicaid patients because the program doesn’t pay enough to cover their costs.
So, you’re blaming expensive medical care on poor people?
I think he’s just throwing a bunch of cr@p on the wall, hoping some of it sticks.
Nearly Half Of U.S. Births Already Covered By Medicaid
I recall reading a newspaper headline while visiting Albuquerque, NM about 14-yrs ago, “…over 50% births on social help…”
On the other hand that means more infantry soldiers for the crusades.
I saw somewhere that “Howard Ruff”,the old newsletter self promoter is quitting for good. I regret that I once subscribed to his so called “Newsletter”‘ for a year , 1981 or so .
The words ‘huckster” ‘’shyster’ and ‘’shrink your nest egg to nothing” come to mind about him and his types,there are always people around like that , must say he had a long run of it.
Harry Dent “Roaring 2000s” is another one. He predicted a great depression either in 2009 or 2010 and advised followers to get completely out of stocks by 2009. If you took his advice and have been in cash since then, you would have missed the current boom. Worse, the stocks were starting to fall in 2008 mid summer.
I see he is still predicting doom. He will eventually be right based on the broken clock theory.
Bob blinker is another tin foil hat guy. And the Elliot Wave types too.
Market cycles do happen in every asset class but you can never predict when they occur. Dent is four years overdue. I am glad I ignored his advice. He predicted boomers (nearly everyone of them) will retire on time and downsize. He did not consider that man boomers decided to continue working and save because they could not afford to retire! Also people are living longer lives and many of them are taking better care of their health so that they can work longer.
Bob Blinker! Ha! Brinker.
Nor does Dent consider the fact that the vast majority of retirees choose to continue with their current living situation until something forces them to change (health or finances). Not all will simply pack up and move out when they turn 62. It’s not like boomers are the first people ever to retire…we have lots of data on this subject. It’s just that Dent’s thesis resonates with people and therefore can sell a lot of books…
All their pronouncements were essentially correct if we stuck to the rules, but they just couldn’t imagine god’s children getting bailed out, made financially whole and avoiding the rule of law.
The First Anniversary of the Second U.S. Housing Bubble
Townhall.com | September 8, 2013 | Political Calculations
The second U.S. housing bubble has been inflating for just over a year now!
July 2012 marks the zero point for the inflation phase of the new housing bubble, with its expansion really beginning to take off in August 2012. And now, since we have the latest median household income data for the month of July 2013, we can show just how much it has inflated as it reached its first birthday!
Our chart above shows the data and trends for the non-inflation-adjusted twelve-month trailing averages of both median new home sale prices and median household income for each month since December 2000. In looking at the current trend, since July 2012, the median sales price of a newly constructed home in the United States has gone up by just over $25 for every $1 that median household income in the United States has increased.
That’s almost 20% faster than the $21-to-$1 rate that the first U.S. housing bubble inflated on average from November 2001 through September 2005!
We’ll close this edition of our ongoing series exploring the inflation of the second U.S. housing bubble by looking at the long-term view of what established equilibriums for median new home sale prices really look like in the United States, which is how we really know that what is going on in the U.S. housing market is really a bubble:
Since 1967, median new home sale prices in the U.S. have typically increased by anywhere from $3.37 to $4.09 for every $1 increase in median household income in the absence of any periods of bubble inflation or deflation in U.S. housing markets.
At its first anniversary, median new home sale prices in the second U.S. housing bubble are inflating at a rate that’s over six to seven times greater than those typical levels!
But perhaps more telling about the now one-year-long escalation in median new home sale prices, is that the next time we feature an update about the second U.S. housing bubble, we’re going to need to adjust the vertical scale of our charts so they can contain the newest data.
The magic of leverage:
“Since 1967, medium new home sale prices in the U.S. have typically increased by anywhere from $3.37 to $4.09 for every $1 increase in medium household income …”
This has got to be due to leverage, I don’t see how this can be done in any other way.
Which means if household income DROPS (as it seems to be doing now) then what will happen to leveraged house prices is …?
(Stay tuned for the answer.)
buying a house is the smartest investment you will ever make.
the land under your house is there to stay.
In theory a house properly maintained has a lifespan longer than you will ever dream about living.
With the price of land, labor and materials constantly rising it is a no brainer to lock into a fair price.
It is time to make sh@t happen in your life.
I can show you some (once) truly magnificent houses in Philly, Trenton, Detroit, Cleveland, etc. that would cost well over $2 million to construct today.
The land underneath them has not changed.
Yet you can buy them for $30,000 or less…
I can tell 99.999% of your posts are sarcastic, but I am not sure the average HBB reader is able to detect it.
For the benefit of other readers, would it be too much to ask for you to always include sarcasm tags with your pro-home-ownership posts?
I think that would defeat the purpose, as nice as it would be.
“buying a house is the smartest investment you will ever make” …except when section 8 moves in next door or the Obamarx administration establishes a new neighborhood integration program so that cRAP music and fatherless kids prevails in your hood.
Don’t worry - your house can be your retirement next egg…
————
Our Sinking Retirement System
Townhall.com | September 8, 2013 | Bruce Bialosky
Most Americans are worried about whether their pension money will be available for them when they retire. The 80% of workers who are reliant on Social Security doubt its long-term viability. This fear is validated by Congressional squabbling. Government workers look at what is going on in cities like San Bernardino, Stockton and Detroit and wonder whether they will receive the retirement money they were expecting. To get some clarity, we discussed the future of our retirement system with Sylvester J. Schieber, a former Chairman of the Social Security Advisory Board and author of The Predicable Surprise – The Unraveling of the U.S. Retirement System.
For example, one of the biggest debates we have about the social security system remains the pay-as-you-go-method. Many argue (including this column’s author) that the system really has no assets and that all that exists in the Social Security Trust Fund are pieces of paper that promise future payments – in effect IOUs. Schieber makes clear that, from the inception of the program, there was a debate about pay as you go. Apparently, President Roosevelt (FDR) was highly concerned about a pay-as-you-go system. He felt it would lead to future struggles for the Congress to cover the planned necessary payments to program participants. It seems FDR was clairvoyant as our Presidents and Congress have been discussing (or avoiding discussion) of overhauling the system for more than a decade.
The plan adopted in 1983 to address the shortcomings of the system has proved to be significantly inadequate. The first updating of the retirement age after almost fifty years of social security was a move forward, but not enough. The regular retirement age increased by a year to 66 in 2009, but it will be another 18 years (2027) until the retirement age becomes 67. Schieber stated that life expectancy is going up about a year every decade. That means in 2013, the retirement age should be 68 years old just for the social security system to have an opportunity to maintain benefits.
Almost 20% of American workers are covered by government pensions, and that is where the main concern rests for future funding. In 1974 Congress passed an act known as ERISA, which still controls the rules for pensions. Unfortunately, Congress exempted public pension plans from the act. Schieber sees two problems coming from that exemption. The first and most obvious is the statement to private industry that “we want you to follow rules, but they are not going to apply to us.” This is similar to the current fight over the IRS and Congress being exempt from the rules of Obamacare. Schieber expressed that the double standard creates ill-feelings between private industry and the governmental entities that create laws. He thinks the laws should be applicable to all. Second, he thinks that if public pension plans were covered by ERISA we would not have most of the problems we have today. Certainly, the people receiving high annual pension payouts would not exist because they would be restricted like private plans are today.
The problems that exist with public pensions are because elected leaders make commitments and then don’t provide adequate funding for the pensions. Of course, then there is the morality of public employees retiring earlier and receiving much higher pension benefits than the taxpayers who are funding those pensions. Plenty of Americans will not be crying for the people who have their excessive retirement benefits restructured in the event of a municipal bankruptcy.
the unions and democrats have made public jobs a cash cow at the expense of the real workn man.
And guess what, this trend cannot be reversed. It is already too entrenched. Cops and firefighters deserve to make 100 grand with overtime.
I don’t have a problem with firefighter and (particularly) cops making good living. They risk their lives. It when school teachers, bus drivers, and train operators get excessive pay.
I don’t have a problem with firefighter and (particularly) cops making good living. They risk their lives.
These jobs are way more dangerous than cops and firemen:
Roofers, logers, fishermen, farmers, ranchers and agricultural managers, Helpers, construction trades, Structural iron and steel workers, Refuse and recyclable material collectors, Aircraft pilots and flight engineers Source: BLS
“Roofers, logers, fishermen, farmers, ranchers and agricultural managers, Helpers, construction trades, Structural iron and steel workers, Refuse and recyclable material collectors, Aircraft pilots and flight engineers Source: BLS”
But none of these peeps are heroes.
But none of these peeps are heroes.
Neither are most cops and firemen.
These jobs are way more dangerous than cops and firemen:
7-Eleven clerks and bartenders
The drug laws against victimless crimes made being a correctional officer a lucrative field, at least in Taxifornia. Thousands of those people earn in the six figures if you count overtime pay.
the unions and democrats have made public jobs a cash cow at the expense of the real workn man.
It’s mostly that public jobs’ pay and benefits have kept up with inflation while our “brand” of USA capitalism’s private sector jobs’ pay have not kept up with the same inflation.
So tax homeowners into oblivion so that the poor little public union goons don’t have to face the reality of their progressive utopia?
Why don’t you leave NY for the Libertarian Utopia that is Florida. No state income tax and you can shoot people you don’t like. You’d fit right in!
You might even get a chance to befoul a clean water source, too. But you have to get to know some people down here first.
Private sector pay reflects the reality of the market - increased technology requiring fewer workers plus a global labor glut.
Businesses cannot create money out of thin air like the government.
Private sector pay reflects the reality of the market
We make the market, the market does not make us. Capitalism is a system made to serve people, not vice versa.
Other countries’ systems of markets reflect the reality of much less wealth and income inequality. Ours could too.
The First Anniversary of the Second U.S. Housing Bubble
We got in before prices escalated again in So Ca(Sept 2Xth, 2012 was our coe), and we are very happy with our modest cottage.
The only downfall to a small home is space, but cleaning the joint is the upside. This is our first carpet free home and we love it. We are starting to enjoy the cement pond as well.
time to pull some equity my friend.
A dollar of unleveraged equity is a dollar that is wasted.
(snark)
azdude
Paid for from day one. No cc home, just a place to call home.
inchbyinch, ditto here in so florida (except we bought sept 2011).
Lemming with an innertube
Congrats. We own this joint free and clear. Might be just a simple shack, but it’s affordable as we age. Happy for you as well. For once you and I, timed something right.
jose canusi
I hear ya. Allergy Season did a 180 for us this year. 10 minute dust mop job and done. No mess, no freak’n vacuum!
There is a good point for not paying rent to a landlord (while paying rent to your county in form of property tax): my last place in L.A. ave me $45 out of my $300 deposit. One of my boxes of Charles Shaw wine had left a wierd stain on the carpet. I thought it would come right out if the mgmt did the cleaning after I left. None of my bottles ever leaked. it was probably wine. There just was not enough kitchen space to put the box on the fake wood floor.
Their imaginations ran wild and they assumed something else, wrote it on paper. THat is how bad they are. They did something like that last time I left the apartment complex in early 2011. I only returned because I figure their break lease deal was good.
Tired of mean and nasty management. Never going back there. The whole strip of apartment complexes in that nabe are rated very low.
I do want to have a house in North Scottsdale with city lights view. It will when I buy it, it will also mean I got a permanent job in the Phoenix area. The older I get, the less often I like to spend time at airports. I am getting very close. Did a big career change recently, and it was for me the first major one since 2000. This keeps me mostly in California or Arizona for now. 4 hour airplane flights suck.
Point left out. I gave them scathing reviews months earlier on the apartment complex policies. I think revenge was part of their plan. One of the reviews was on their own web site - a response to a survey that popped up every time I paid rent online.
“This is our first carpet free home”
I wish my home was carpet-free. Having carpet in Florida blows chunks. One of the things you can’t remedy when you’re a renter, unfortunately. There’s great terrazzo underneath it, too. If I were the LLs, I’d just rip up the carpet, have it polished and leave it at that. Let the renters bring in some area rugs and such.
A few questions here on central bank intervention in the housing market:
1) Has such policy previously been used to support housing prices when central bankers decided the market was wrong, or is this time different?
2) Is the causal relationship between ultra-low interest rates and high housing prices controversial, or does modern asset pricing theory suggest high housing prices as a natural consequence of ultra-low rates?
3) Does the will exist in central banks to maintain ultra-low rates and high housing prices forever, or will other priorities eventually take precedence?
4) Will market forces eventually swamp out the effort to maintain housing prices at levels not supported by end-user demand?
5) Is the redistributive effect of housing price support from young families to older, wealthier homeowners generally acknowledged?
6) How much money has the Fed’s housing price support policy (e.g. $40 billion a month in QE3 MBS purchases) transferred directly into the coffers of investment banks and real estate investors?
7) How many of the above-mentioned investment gains left the country, making foreign investors wealthy through expansion of the U.S. monetary base?
Nobody has any opinions to share on central bank policy.
I guess that means the Fed has carte blanche to do whatever it pleases, unopposed.
Was at a church function last night, trying to park in a plum spot, close enough to the front doors for a quick getaway. Only problem is that there was this largish fellow half blocking the parking spot while he held open the door of another guy’s truck in conversation. I waited patiently a couple of minutes, then got out to politely ask if I could possibly pull up my car. I couldn’t help but overhear the topic of conversation as I approached the interlocutors, which was that the largish fellow had bought around 2000, saw his equity dwindle after the big fall 2008 crash, but had recently been able to refinance and now was sitting pretty on top of a big pile of equity again.
When you start to randomly overhear conversations about how much the value of people’s homes have appreciated, you can rest assured the bubble is back.
Hah hah, I can see it all in my mind. Heard my first HELOC commercial since the crash on the radio on the way home from church today.
Did big guy in church parking lot give you the finger for inconveniencing him?
Oh my, they will talk today about what will happen to RE if mortgage rates go to 5% :
http://retradio.com/abouttheshow/
My guess? They will say to get a house NOW!
Well yeah! Higher rates are gonna price you out forever if you don’t buy now — SO WHAT ARE YOU WAITING FOR?!
http://retradio.com/current-show/
Pretty soon the shortage facing the construction industry will morph from dirt to qualified-and-willing end-user buyers.
Prices Are Rising for New Homes, and the Land They Are Built On
Tim Gruber for The New York Times
In order to help build more houses, Otsego, Minn., like other cities in the Twin Cities area, has relaxed its development fees.
By SHAILA DEWAN
Published: September 7, 2013
MINNEAPOLIS — A few months ago, Michael N. Felix’s phone started ringing again after four years of silence. Mr. Felix is a land broker whose business dried up when the housing market crashed. But with home prices now rising faster than anyone expected, builders are again looking for what, in the land trade, is referred to as dirt.
The industry is on track to complete more than 570,000 homes this year, still below the replacement level.
Already, developers report that the cost of land in the most desirable areas is double what it was two years ago. At least three golf courses in the Minneapolis-St. Paul area are being carved into millions of dollars’ worth of residential lots. The race has even sent builders back to outer suburbs like Otsego, 30 miles from downtown Minneapolis, where bulldozers are laying the groundwork for four-bedroom houses with three-car garages, in subdivisions bordered by cornfields.
“Lot buyers and sellers!!!!!!!!” Mr. Felix’s Web site reads. “It is time to get moving again….!”
Or past time. The latest land rush is in full swing, as developers realize that they have failed to feed the zoning, permitting and mapping pipeline, which can take months or years to turn raw fields into buildable lots. They are realizing another thing, too: they have been sorely missed.
“For the first time, I’ve seen cities want to work to help figure it out, rather than doing us a favor all the time to let us develop,” said Scott Carlston of Hunter Emerson, a development partnership. Hunter Emerson won a victory when the city of Eagan, a suburb of Minneapolis, allowed Parkview Golf Club to be converted into a high-end single-family subdivision.
The hunt for dirt is not limited to the Twin Cities. After builders across the country spent decades feeding acre after acre of raw land into the maw of demand for single-family homes, the housing crash left them with a land surplus so large that lots were selling for pennies on the dollar. At the peak of supply, in 2009, there were enough lots to last almost eight years, according to MetroStudy, a firm that tracks housing data. Now there is less than four year’s worth, and only about a quarter of that is in the more desirable A- or B-rated locations.
“We have gone from a situation where five years ago everyone was saying, ‘There’s too many lots,’ to today, builders are literally crying on our shoulder saying, ‘There’s not enough lots. We can’t find any,’” said Bradley F. Hunter, the chief economist at MetroStudy.
…
Fed bashes media on housing data
By Nin-Hai Tseng, Writer
September 4, 2013: 11:11 AM ET
Are first time homebuyers back or aren’t they? The Federal Reserve wants us to believe they are.
FORTUNE — Throughout recovery of the U.S. housing market, a lot of attention has been paid to young homebuyers. Countless surveys and studies suggest the share of first-time homebuyers in their 20s and 30s has dropped off considerably, that they’ve been missing out as the housing market heals.
The media, including Fortune, has widely reported the problem at a time when many young people are bogged down by joblessness and large debts from student loans. Now analysts at the Federal Reserve say the decline isn’t as bad as the media has made it out to be.
In a report last week, analysts at the Federal Reserve of Atlanta point to articles by the Wall Street Journal, USA Today, and Bloomberg Businessweek, which cite surveys by the National Association of Realtors (NAR), an industry group that tracks home prices and purchases. While the surveys may be right, the way the press has interpreted them is flawed, analysts write.
The media has widely reported that first-time buyers currently make up roughly 30% of all home transactions, compared with an average of roughly 40% over the past several decades. While that might be true, the figures come from different surveys reflecting varying frequencies — whereas the 30% share comes from a monthly survey, the 40% average comes from a yearly survey. Since the two sets of numbers are distinctly different, they can’t be fairly compared to one another.
MORE: Are we ready for the next meltdown?
…
How much longer until the GSEs and FHA stop propping up the mortgage market, allowing private lenders the chance to reenter the business?
Rules were made to be broken.
For home short-sellers, finally comes some good news
Sunday, September 8, 2013
Kenneth R. Harney
WASHINGTON — Policy changes by two of the biggest mortgage market players could open doors to home buys this fall by thousands hard-hit by the housing bust and who thought they’d have to wait for years before owning again.
Fannie Mae, the federally controlled mortgage investor, has come up with a “fix” designed to help the many consumers whose short sales were misidentified as foreclosures by credit bureaus. Under previous rules, short-sellers would have to wait for up to seven years before becoming eligible for a new mortgage. Under the revised plan, they may be able to qualify for a mortgage in as little as two years. Homeowners who are foreclosed upon often must still wait for up to seven years before becoming eligible again to finance a house through Fannie. Industry estimates suggest that more than 2 million short-sellers might be affected by inaccurate descriptions of their transactions.
Meanwhile, the Federal Housing Administration (FHA) has announced a new program allowing borrowers whose previous mortgage troubles were caused by “extenuating circumstances” beyond their control to obtain new mortgages in as little as a year after losing their homes instead of the current three years. They will need to show that their delinquency problem was caused by a 20 percent or greater drop in income that continued for at least six months, and that they are now back to work, paying bills on time and earning enough to qualify for a new FHA-insured mortgage.
Fannie’s policy change came after months of prodding by the federal Consumer Financial Protection Bureau, U.S. Sen. Bill Nelson (D-Fla), the National Consumer Reporting Association, the National Association of Realtors and Pam Marron, an outspoken Florida consumer advocate. They all sought fairer treatment of borrowers who had participated in short sales in recent years.
In a short sale, the lender approves the sale of a house to a new buyer but typically receives less than the balance owed. In a foreclosure, the bank takes title to the property and seeks to recover whatever it can through a resale. Though the two types of transactions are distinct and involve significantly different losses for banks, with foreclosures usually far more costly, credit bureaus have no special reporting code to ID short sales. As a result, say critics, millions of people who have undertaken short sales in recent years may have their transactions coded as foreclosures on their credit bureau reports.
That matters — a lot — because Fannie Mae and other major financing sources have mandated different waiting periods for new loans to borrowers who have completed short sales compared with borrowers who were foreclosed upon — in this case, two years versus seven. Under the new policy in effect Nov. 16, short-sellers who find that their transactions were miscoded on credit reports and are able to put 20 percent down, should alert their loan officers and provide transaction documentation. The loan officer should advise Fannie about the coding error. Fannie will then run the loan application through its revised automated underwriting system.
Freddie Mac, the other government-administered mortgage investor, continues to require a four-year waiting period for short-sellers who cannot demonstrate “extenuating circumstances” as having caused their problems. If they can do so — documenting income reductions beyond their control that wrecked their credit — they may be able to qualify for a new Freddie Mac loan in two years.
…
Progressives claim the U.S. housing market would collapse without Fannie Mae and Freddie Mac.
Republican Congressional representatives don’t buy it, maintaining the private sector does mortgage banking better than Uncle Sam.
Time will tell which perspective will prevail.
Mortgages
Life Without Fannie Mae and Freddie Mac
The New York Times
By LISA PREVOST
Published: September 5, 2013
Talk of doing away with Fannie Mae and Freddie Mac is still just that — talk. But as Congress considers whether and how to get rid of these agencies, consumers ought to be aware of how a substantial reduction in the government’s role in housing finance could affect their ability to borrow in the future.
“What’s at stake here is access to mortgages at an affordable price,” said Julia Gordon, the director of housing finance and policy at the Center for American Progress in Washington.
Fannie and Freddie have been much maligned since their heavy investment in risky loans resulted in a $188-billion taxpayer bailout during the financial crisis. Having since refocused on guaranteeing and securitizing prime mortgages, while also acting as a fill-in for fleeing private capital, the agencies now own or guarantee a majority of the country’s home loans.
As the housing market strengthens, Congress is interested in transferring some or all of that risk back to the private sector. Last month, President Obama voiced support for a bipartisan effort in the Senate to replace the government-sponsored agencies with a new agency with a much-reduced role.
A competing bill in the House would go even further to almost completely privatize the mortgage market.
If a winding down of the two agencies is inevitable, some government guarantee should remain to ensure lending is widely available and safe, Ms. Gordon said.
“The private market likes to look at every single loan — they only want the loans that are the crème de la crème,” she said. “If you scale back the government guarantee too much, then you end up with a really segmented market where people who have pristine credit scores and lots of money can get good, safe, well-priced mortgages, but everybody else can’t.”
…
Republican Congressional representatives don’t buy it, maintaining the private sector does mortgage banking better than Uncle Sam.
The private sector loves Fannie and Freddie. They can originate loans, collect handsome fees and then resell the loans to Fannie and Freddie.
What is there for them to not like?
There should be three sectors:
• Public (pure government)
• Public-private (has government as the primary customer)
• Private (other than government as primary customer)
“Progressives claim the U.S. housing market would collapse without Fannie Mae and Freddie Mac.
Republican Congressional representatives don’t buy it, maintaining the private sector does mortgage banking better than Uncle Sam.”
Both can easily be true.
private lenders are dinosaurs. the stock market and housing market have entered a new regime.
Sarcasm tags, pleaze…
1 DAY ago
Real Time Economics
Henry Paulson Defends Fannie Mae Bailout
In an interview, the former Treasury Secretary says the government had no choice but to save Fannie Mae and Freddie Mac.
By Nick Timiraos
Former Treasury Secretary Henry Paulson led the government’s takeover of Fannie Mae and Freddie Mac in September 2008 after Congress granted the Treasury emergency powers to stabilize the companies earlier that summer.
Officials initially believed the government rescue would serve as a short-term timeout while buying them more time to put out other fires, including the solvency of Lehman Brothers. But the failure of Lehman one week later added more fuel to the financial panic. Meanwhile, the depth of the housing downturn and an ideological stalemate over what to do with Fannie and Freddie has stymied efforts to address the future of the companies.
In an interview, Mr. Paulson explained Treasury’s decision making and outlined his views about what should be done now. What follows is a shortened, edited transcript:
What would have happened to Fannie Mae and Freddie Mac if you had not put them into conservatorship when you did?
Mr. Paulson: The thing we did that got the least attention or credit as we were going through the crisis, and even today, but yet made the biggest difference—it was the single most important thing we did—was stepping in and putting them in conservatorship. The reason it has gotten less attention is because we moved before they became unglued. If they had had a failed auction and those securities which are held by community banks, pension funds, etc. lose value, and people began to dump them, it would have been disastrous. It was a race against the clock.
What was your reaction after both boards of Fannie and Freddie had accepted the government’s terms, and the conservatorship was signed and done?
Mr. Paulson: For a very short time, I thought there, it was such a powerful action that it would make a big positive difference in terms of stopping the panic. But instead I think what investors said was, “Holy cow! If Fannie and Freddie have got these problems…”
…
If one wonders how a top Wall Street insider and former Goldman Sachs CEO would have handled the financial crisis, while being granted full access to the public treasury, one doesn’t need to wonder. Because that’s exactly what happened.
As William K. Black has written, “The Best Way To Rob A Bank Is To Own One.”
Why would someone who can afford to buy a $1 million home in cash bother with a mortgage?
Upon realizing the huge tax subsidy benefit of deducting the interest on a $1 million dollar loan, the answer becomes obvious: THIS IS WELFARE FOR THE WEALTHY, AND RICH FOLKS ARE NOT TOO PROUD TO ACCEPT IT TO THE TUNE OF BILLIONS AND BILLIONS OF DOLLARS.
To make matters still more egregious, middle-class taxpayers who are priced out of the housing market implicitly bear the cost of wealthy folks’ tax breaks ON SECOND HOME MORTGAGES. Why should ginormous mortgage interest subsidies flow to those who have enough money to buy homes outright with cash, and have still more left over to buy vacation homes?
Wealthy Homeowner Tax Breaks Targeted
Wednesday, August 21, 2013
Jeff Brown
Citing the shift of balance between wealthy homeowners and those who can’t readily afford housing, the Smart Growth for America (SGA) coalition is hoping to level the playing field by cutting tax breaks for the former and increasing benefits to the latter. Specifically, SGA suggests eliminating the mortgage tax deduction on second homes and cutting the tax exemption for home sale profits, while advocating for a government-supported investment scheme for first-time buyers. This, they argue, will stimulate growth and participation in the market by lower-income individuals, which in turn will fuel overall economic health. For more on this continue reading the following article from TheStreet.
Among the cherished rights of homeowners, two stand out: the tax deduction on mortgage interest payments and the tax exemption for profits on a home sale. If a Washington-based coalition has its way, both would be cut for wealthier homeowners.
At the same time, the coalition proposes an IRA-like savings account to allow prospective homeowners tax exemption on savings for a down payment. That begs the question: Under today’s conditions, what is the best way to save for a down payment?
The coalition’s proposals may never go anywhere, but they do show that anything could be on the table as Congress and the administration look for tax reforms.
Membership in the group Smart Growth for America includes environmental organizations, developers and investors and others focused on sustainable development, largely with a focus on making cities more livable. Its housing proposals would leave long-standing government support in place for homeowners of low and moderate incomes, but reduce benefits for wealthier property owners.
The coalition, for instance, recommends eliminating the mortgage interest deduction on second homes. For primary residences it would reduce the maximum debt to which the deduction could be applied to $500,000 from the current $1 million. It also recommends limiting real estate tax deductions for households making more than $100,000 a year.
And it would cut in half the tax exemption for profits on a home sale, setting a $125,000 limit for individuals, $250,000 for couples filing joint returns.
…
How would wealthy California homeowners cope if the rest of the country weren’t forced to subsidize their purchases of homes costing $500,000 on up through the tax deduction on mortgage interest payments and the $500,000 tax exemption for profits on a primary home sale?
How is it again that Uncle Sam can “afford” to give away $70 billion a year to the wealthy in mortgage interest deductions?
MORTGAGE DEDUCTION IN CROSS HAIRS?
Is mortgage-interest deduction in the cross hairs?
Where taxes and mortgages collide. A review of tax law might target the mortgage interest tax deduction, which costs the federal government at least $70 billion a year. Defenders of the deduction say it helps propel housing sales and values.
PHOTO ILLUSTRATION / TERRY GALVIN
By John Hielscher
Published: Sunday, August 11, 2013 at 1:00 a.m.
Last Modified: Saturday, August 10, 2013 at 4:24 p.m.
The mortgage interst tax deduction has long been considered a sacred cow of the U.S. tax code because it helps millions of families buy and keep homes.
But as Congress takes a comprehensive look at tax reform this year, some say it is time to change or eliminate a provision that costs the government at least $70 billion a year.
Home builders, real estate agents, mortgage lenders and others say the mortgage interest tax deduction makes it possible for mostly middle-class families to achieve home ownership.
But some economists and tax reformers contend the deduction mostly benefits higher-income homeowners who could afford to buy without it.
…
“The mortgage interest tax deduction will cease to exist as we know it in 5 years.”
And it can’t go away soon enoug.
Why would someone who can afford to buy a $1 million home in cash bother with a mortgage?
Even with the tax deduction, they’re still paying interest.
Maybe it’s because they’re hedging, knowing they can walk away if the house loses a lot of value and would rather not tie up their own money in it.
People who pay a disproportionate share of of taxes ought to get some benefit from them.
Top 1% AGI ($340K) pay 37 percent of all fed personal income taxes
It would be better to just give direct handouts to the wealthy than to continue the economic distortions due to pouring money down the housing market rathole.
Go ahead and tax the rich at 100%. Not enough them to pay for all the spending in DC and in statehouses. Don’t know why the left is so focused on redistributing the pie instead of making more pie. Guess cause they don’t have clue how to make pie.
Don’t know why the left is so focused on redistributing the pie instead of making more pie
Because redistributing the pie creates more pie because more people have more money to buy and make pie.
BTW, the wealth was redistributed from the middle-class to the rich the past 40 years. This is why there is so little pie for so many formerly middle-class Americans.
I guess the rich don’t know to create a bigger pie. (except for them)
Question #1: Where are the wealthiest metropolitan areas in the United States?
Question #2: What are the five largest occupations held by those living in those metropolitan areas?
Question #3: What are the voting patterns of those wealthiest metropolitan areas?
“There is surprisingly little hard evidence that the mortgage interest deduction has encouraged home ownership.”
On what planet is it “news” that NAR claims about how the mortgage interest deduction encourages home ownership are based on nothing but unsubstantiated propaganda?
That said, it is great to see some big name academics taking on the NAR’s lies and misrepresentations.
Mortgage interest deduction doesn’t aid buying
Friday, August 9, 2013 6:44pm
There is surprisingly little hard evidence that the mortgage interest deduction has encouraged home ownership. Harvard economists Edward L. Glaeser and Jesse M. Shapiro have found that it has only a trivial effect.
A major reason is that the deduction has long been capitalized into the prices of homes. That is, home prices are higher than they would be without the deduction. Thus to the extent that the deduction encourages home ownership, it is exactly offset by the extent to which high prices discourage homeownership.
It is likely that if mortgage interest had never been deductible, the homeownership rate would be similar to what it is today. Indeed, it might even be higher, according to research by the economists Matthew Chambers, Carlos Garriga and Donald E. Schlagenhauf. They contend that without deductibility tax rates could have been lower, which would have raised after-tax incomes, making it easier to afford a home.
There is further evidence from foreign countries. According to a recent paper by the economists Steven C. Bourassa, Donald R. Haurin, Patric H. Henderschott and Martin Hoesli, there is little evidence that mortgage interest deductibility has any impact on homeownership rates one way or another. As the table from their paper shows, many countries without deductibility have higher homeownership rates than we do, and some with deductibility have lower rates.
Reformers have asserted that there are negative social and economic effects to the mortgage interest deduction. For example, it may encourage people to buy pricier homes even if it doesn’t affect the rate of ownership. To the extent that the deduction encouraged greater indebtedness, it may have contributed to the recent financial crisis.
As we know, a crucial problem has been that many homeowners found themselves “under water” as the value of their homes fell below the balance of their mortgages. A key contributor to excessive housing debt is the deductibility of home equity loans that can be used for personal consumption.
…
FWIW, other countries with no MID have bubbles that put ours to shame.
Not just no MID, but no Fannie or Freddie either.
A Frog walks into a bank to apply for a home loan 3 years after a foreclosure.
The loan officer Miss Pattywack asks the Frog how much money he has and what he has for collateral.
The Frog shows Miss Pattywack a small statue.
As Miss Pattywack is explaining to the Frog why he did not qualify for the home loan the bank president walks up and asks what the problem is.
Miss Pattywack tells the bank president that the Frog is 3 years out from a foreclosure, he has no money, he has a 590 FICO score and a small statue for collateral.
The bank president says…
It’s a nick nack Pattywack give the Frog a loan.
…This old Frog just bought a home.
It’s a nick nack Pattywack give the Frog a loan.
…This old Frog just bought a home.
That old Frog, he don’t pay.
Gets to stay there anyway.
It’s a nick nack Pattywack give the Frog a loan.
That old Frog got a free home.
Now the frog is a victim, shouting where is “his” bailout and demanding congress investigate predatory loans to amphibians…
Subprime webbed loans!
Frogs have to watch out for all kinds of enemies in the wild. There are a wide variety of frog predators. Animals that eat frogs for snacks include snakes, lizards, birds, and bankers.
Phony -lol good one.
whac- thanks for the ending.
Can the Weight of 90 Million Not in the Workforce Collapse the Economy? Yes, We Can
Townhall.com | September 8, 2013 | Morgan Brittany
With the latest numbers out this week from the Bureau of Labor Statistics stating that over 90 million people are out of the work force, I would say that the White House is well on its way to fulfilling its Cloward and Piven dream.
Over the past five years, Barak Obama has “fundamentally transformed America” and we have the statistics. Here are a few of his accomplishments:
1. As of this week, there are a record number of Americans out of the work force.
2. There are a record number of Americans on food stamps.
3. There are a record number of Americans on disability.
4. There are a record number of Americans working part-time.
5. The unemployment rate for black youth in July was more than 46%.
6. Obama has succeeded in hurting the people who voted and supported him the most. Women, minorities and the young.
With the dismal statistics this week it is transparently obvious that we are headed in the wrong direction. There is no recovery and no matter how they want to spin it, there isn’t one on the way. Not with Obamacare and a pending war with Syria on the horizon.
This administration can spin it all they want. They make excuses for the lower participation rate by saying that it is due to “Baby Boomers” retiring and women not as active in the work force as they once were. I say that is all smoke and mirrors.
With the entitlements that are being offered, more and more people are opting out of trying to find a job. With jobs being scarce and only part time work being offered, it is very enticing to sign up for an EBT card, go on disability and take full advantage of what the government is handing out. In some places, like Hawaii, you can receive as much as $60,590 a year from government benefits!
Okay, the time has come…
One of the reasons the government is not being forced to address the problems and enable the private sector to solve it is because much of the current strife is hidden from view.
Wanna force change? Force the problems out into the open.
Start with EBT cards. Eliminate them entirely. As in the 1930s, let those receiving government assistance stand outside, in line, in rain/sleet/snow cold. Don’t deny them. But do let them stand there.
Imagine the wake-up call if nationwide, we suddenly saw tens of millions of people standing in line, waiting for food?
Millions of people standing in line in California, Texas, New York. Hundreds of thousands in Georgia, Indiana, Oregon, Nebraska, Nevada. Tens of thousands in Maine, Kentucky, New Mexico, Hawaii.
Wanna see real change happen? Start there.
Roll up lots of other foul carpets as well. Expose the rot, let the people wallow in it. And let them wallow in it for several months. Then hand them a shovel.
The Germans never forgot “touring” the concentration camps after Berlin fell. Perhaps it’s time for Americans to really be exposed to its brand of self-induced rot and ethical decay.
I’m hoping a politician will come along who is willing to proceed down such a path.
This citizens of this country need a serious wake-up call before the government actually gets serious. It appear the wake-up call will need to be self-induced. (Done properly, it will be shocking NON-political).
Good idea. I ‘ve always said people on the dole should not have checks sent to them but should have to go collect the money in person fairly frequently. Maybe daily for those living in cities and perhaps weekly for other. Also it should be early in am. Get the used to or keep in the habit of getting up and out.
No checks. Physical good only. Delivery of physical goods to people standing in line out in the snow will wake up those in distribution.
The food should be handed out wherever government hacks get to use their taxpayer-funded freebies. Like in front of museums, opera houses and restaurants where freebies are consumed.
VERY few people are willing to examine and live in and amongst the rot. Government elitists especially.
EBT cards are just one example of how to hide public problems from public view. No one understands how gigantic the problem really is because no one really sees it. The government loves this!
Live the rot in public view and things will change.
Guaranteed.
No, we should put everyone on EBT cards so there is no stigma. Just like the free breakfast programs being instituted in Boston and all major urban areas as we speak!
Government MUST perpetuate the lies as it does not generate a profit.
As it grows, so do the depth and breadth of its lies. The lies MUST become more frequent and severe as government grows.
EBT cards serve to perpetuate the lie. They are a great vehicle for perpetuating fraud.
The public cares about stigma, though not like it used to. They see their leaders as uninterested in ethics and morals, so why should they care about “stigma”?
The government doesn’t care one way or the other about the citizenry’s negative perception about itself unless it stands to gain by it.
A government that passes laws without public discussion certainly doesn’t give a damn about whether people feel stigmatized.
The best way to help the poor is to make them uncomfortable in their poverty–– Benjamin Franklin
The best way to help the poor is to make them uncomfortable in their poverty–– Benjamin Franklin
Except for slaves, there was almost no relative “poor” in Ben Franklin’s times compared to today. Most Americans in the 1700’s were self-sufficient farmers or self employed and the wealth and income gap was minimal compared to now. America then was an egalitarian society. Thomas Jefferson wrote about this.
Nowadays in the USA, do you think it’s wise and just to ship the poor’s job away, hammer them with inflation and then intentionally try to make them more uncomfortable?
I think Ben Franklin would differ.
Wanna force change? Force the problems out into the open.
Interesting. Maybe so.
Imagine the wake-up call if nationwide, we suddenly saw tens of millions of people standing in line, waiting for food?
This I agree with, foodstamps helps sweep the problem under the rug so the haves don’t have to see it. Mind you, the have nots are very aware of their situation. They don’t line up at Walmart, their shopping carts full of cheap and unnutritious food just before midnight because they’re living large. And that keeps them out of sight of the professional and managerial class.
That said, I think we’ve reached a point where the majority wouldn’t care anyway
That said, I think we’ve reached a point where the majority wouldn’t care anyway
I say this because local food pantries are stripped clean, and no one cares.
But, the alleged Communist,would be fine if recipients received their food from pantries.
Of course, these would have to be government pantries, with lots and lots of government employees. And WalMart would scream bloody murder at losing so many customers. So it would of course be unacceptable.
I have a friend who found a job after a spell of unemployment. She still takes from the church food bank and they’re north of $65K for 2 people, no debt and a low piti. She’s obese on top of it. 5 bags full of food each Sunday.That makes me sick.
their shopping carts full of cheap and unnutritious food
As the purported purpose of the program is nutrition, it would seem fairly reasonable that it provide only nutritious food; we could have a far better nutritional effect if we distributed rice, beans, spices, and an electric hot-pot to cook them in.
Of course, that makes no sense when the real purpose of the program is to give money to big Agribusiness.
I’m glad I checked before remarking about her having the same name as Morgan Brittany.
Syracuse watch:
The burbs south of Syracuse are looking mighty bubbly lately. Multiple auction signs out this month. I had never seen more than a handful over the last few years. On one particular road there were multiples of properties for auction in a 3 mile expanse.
Usually a large number of listings are taken off the market w/in the next month. Instead I am seeing a rash of new listings. Four new ones in my immediate vicinity. It is my opinion that several are way overpriced. They have bought into the meme that prices are up and I’m sure can’t believe they might have to take a loss. I’ve seen what’s selling out there. The new listings by me are way overpriced and have put themselves in a position where they’re looking for a greater fool.
The rash of auction signs have kind of spooked me. I’m worried there is another correction imminent.
Cheers, CarrieAnne. So glad to see you’re still around! I’ve missed your commentary here; fill us in a bit on your doings?
Had a Ribeye Steak from section 2 tonight.
Beef Choice Diagram| Where does your steak come from?
http://www.chigourmetsteaks.com/choosing_beef.php - 27k -
My apologies to you vegetarians out there, a group that I believe Ben is part of. I don’t even like salad all that much, although I tolerate it because salad means beef is coming soon.
Sept. 8, 2013, 11:39 p.m. EDT
Is Hong Kong next to feel the taper chill?
Commentary: Property exposed on warnings of fund outflows
By Craig Stephen
HONG KONG (MarketWatch) — Plans by the U.S. Federal Reserve to taper its financial-asset purchases have already sent various emerging-market currencies into a tailspin. Could Hong Kong be the next to suffer?
On Friday, Hong Kong Monetary Authority chief Norman Chan said the money which had flooded into Hong Kong since the start of U.S. quantitative easing will “inevitably” reverse as the Fed begins to taper. He put the total of QE-driven inflows at 100 billion Hong Kong dollars ($12.9 billion).
Hand-ringing warnings from Hong Kong officials are hardly uncommon, and up to now have largely been ignored by investors. But as we move from expectation of tapering to execution, is it time to start paying attention?
The upcoming Federal Reserves Open Markets Committee meeting on Sept. 17-18 is widely expected to give more clarity on how tapering — or reduction of financial-asset purchases by the Fed — will proceed.
Already, the mere expectation of a reversal in the unprecedentedly accommodative U.S. monetary policy has jolted Asian markets. One effect of QE was to boost the attraction of riskier assets, including those in the emerging markets. Now, as this cheap-money pot gets removed, higher-risk carry trades are being reassessed.
So far, it has been countries running current-account deficits and reliant on foreign-fund inflows for growth that have been punished. The two most affected economies in the region have been Indonesia and India, where the rupiah has sunk to multi-year lows, and the rupee to historic lows.
But who will be hit next if there is a tapering contagion? The risk is that the search for other vulnerable currencies or asset markets will now spread.
…