Bits Bucket for November 14, 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
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I’m thinking of becoming a shadow banker. If you can’t beat ‘em, join ‘em.
Shadow banks reap Fed rate reward
Published: Monday, 11 Nov 2013 | 3:06 PM ET
By: Sam Fleming
Loosely regulated non-bank lenders have emerged as among the biggest beneficiaries of the Federal Reserve’s ultra-low interest rates with three specialist categories increasing their assets by almost 60 percent since the height of the financial crisis.
Such lenders, widely considered part of the “shadow banking” system, have expanded rapidly on the back of investors who are clamoring for the higher returns on offer from financing riskier types of lending.
Shadow banking has been steadily climbing the regulatory agenda, with the Financial Stability Board this summer proposing a package of measures aimed at curbing excessive risk-taking in the sector. The regulators’ concern is that many of these lenders could over-borrow or make increasingly dicey loans as they rush to take advantage of historically low rates, exuberant markets and the retreat of traditional banks from certain businesses in response to tougher regulation.
“Think of it like a pipeline,” says Dan Zwirn, managing partner of Arena Investors, a hedge fund focused on lending to companies that most banks will not lend to. “When you can connect the pipe between a type of asset and yield-hungry investors, then what happens is that issuance grows.”
…
They need to start making huge contributions to politicians. Then they too can push the losses onto the government (i.e. taxpayers) and keep the profits.
Privatize the profits, socialize the losses, good business model to implement if you can buy sufficient numbers of politicians.
Now there’s talk of Yellen increasing QE to $100B per month. Taper? We don’t need no stinking taper!
Did they ever actually specify which direction they were planning to taper?
Whatever direction, it will look like that turd that it is. Turds taper and FedScum are turd architects.
They used a mirror when explaining it.
Whatever direction, it will look like that turd that it is. Turds taper and FedScum are turd architects.
When extruding through a flexible orifice at varying rates, taper is almost guaranteed.
“Taper Happens”.
They are following the sun and poles are flipping.
“Best Explanation on the Fake Housing Market Recovery I’ve Seen”
http://smallbusiness.yahoo.com/advisor/best-explanation-fake-housing-market-recovery-ve-seen-162530153.html
First the HBB, then Mark Hanson, then Ritholtz…… now it’s gone mainstream.
The dead cat bounce that was falsely characterized as “the housing recovery” is now under the full control of gravity.
“What’s going on with the equity markets right now reminds me of 2007 all over again—that’s when the key stock indices were moving higher, regardless of what was happening with the economy. ”
I think that the author must have been following Professor Bear’s comments from a few years ago regarding the PPT
“I’m thinking of becoming a shadow banker.”
Give my regards to Jon Corzine at the next coke party.
LendingClub Said to Reach $2.3B Valuation in DST Funding
By Ari Levy - Nov 12, 2013 9:00 PM PT
LendingClub Corp., the largest U.S. peer-to-peer lender, received a $57 million investment from Yuri Milner’s DST Global and Coatue Management LLC as the company nears an initial public offering.
The transaction values LendingClub at $2.3 billion, said two people with knowledge of the deal, who asked not to be identified because the valuation is private. LendingClub Chief Executive Officer Renaud Laplanche said the share sale closed yesterday and consisted entirely of stock purchased from early backers.
The San Francisco-based company is spearheading a surge in online consumer lending, by letting individuals and institutions provide credit to other people in return for yields that are more than three times higher than 10-year Treasuries. LendingClub’s valuation has jumped 48 percent since Google Inc. led a $125 million secondary purchase in May, which valued the company at $1.55 billion.
LendingClub “uniquely combines the scalability and efficiency of online marketplaces with a large addressable market,” Milner wrote in an e-mail. He didn’t comment on the company’s valuation and Katherine Madariaga, a spokeswoman for LendingClub, also declined to comment on valuation.
…
It is impossible to lose anymore buying stocks.
Nov. 13, 2013, 4:54 p.m. EST
Yellen backs Fed’s bond-buying program
Economy, financial system stronger than in ‘dark days’ of crisis
By Greg Robb, MarketWatch
Bloomberg
Janet Yellen in 2010. She’s due to testify in front of the Senate Banking Committee on Thursday.
WASHINGTON (MarketWatch) — Janet Yellen, President Barack Obama’s pick to lead the Federal Reserve, defended the central bank’s unconventional asset purchase program, calling it the best way to get the economy back to normal.
“I believe that supporting the recovery today is the surest path to returning to a more normal approach to monetary policy,” Yellen said.
Yellen’s comments came in her prepared statement to the Senate Banking Committee. Although the hearing is on Thursday morning, the committee released the text of her opening remarks early.
There had been market speculation that Yellen’s comments would be released Wednesday and that they would be bullish for stocks. The Dow Jones Industrial Average rose 71 points to hit a new record. Read Market Snapshot.
Markets view Yellen as more dovish than Federal Reserve Chairman Ben Bernanke. But one of the lessons from the switch from former Fed Governor Alan Greenspan to Bernanke was that convention wisdom can easily get turned on its head.
…
Markets view Yellen as more dovish than Federal Reserve Chairman Ben Bernanke. ”
the 1% will rejoice in continued easy money
“the 1% will rejoice in continued easy money”
And so too will those who have stayed with dollar cost averaging in their 401ks for the last couple of decades. I did not realize we 401k and IRA investors who are white collar professionals in fields like STEM are part of the 1%. I will take the label.
• The Fed makes vast purchases no one else will because it doesn’t make economic sense for anyone else to do so. But of course, that won’t introduce malinvestment or distortions.
• Their unexamined cargo-cult-like faith in housing is really precious. Yes, there’s a burst of economic activity when a homeowner buys a house, but that homeowner then spends the next several decades paying for it, reducing spending in the real economy, while funneling money to Wall Street.
• A banker’s view of how to get the economy back on track - get everyone up to their eyeballs in debt. Who does that enrich? Right, the banks and associated finance-related companies.
• Inflation is a stealth tax. Combine that with ZIRP and you are eroding people’s wealth at a pretty reliable clip. Japan had ZIRP but no inflation, in fact, very mild deflation. You can have one or the other but both will make the natives restless.
Allow a bank to direct economic policy, and they’re going to do what makes a bank profitable and try to apply it to the economy at large. Which means increase debt and debt payments.
• “When the only tool you have is a hammer, every problem looks like a nail.” — Abraham Maslow
• “It is difficult to make a man understand something when his salary depends on his not understanding it.” - Upton Sinclair
Former colleague casts doubt Yellen will have courage to tighten
November 13, 2013, 11:30 AM
Bloomberg
Kevin Warsh
Does Janet Yellen have the courage and conviction to tighten monetary policy when markets are opposed to it?
Kevin Warsh, her former colleague at the Federal Reserve, seems to have his doubts.
In an op-ed published Wednesday in the Wall Street Journal, Warsh said that the Fed has been handing out candy to spur markets higher.
“Consider the challenge when a steady diet of spinach is on offer,” Warsh said.
…
She is NOT going to tighten. Now they are talking that she is going to INCREASE QE to $100 billion per month. QE to infinity and beyond!
Nov. 14, 2013, 3:29 a.m. EST
Europe stocks rise after Yellen hints on stimulus
By Barbara Kollmeyer
MADRID (MarketWatch) — European stock markets opened higher on Thursday after nominee chair for the Federal Reserve, Janet Yellen, signaled stimulus will be in place until the U.S. economy recovers. Markets shook off news of disappointing growth statistics for both France and Germany.
…
I have been in money market since 2007. Joke’s on me.
Steady lad- steadyyyyy. It takes uncommon courage to think for yourself these days and face the bullshit around us with an unblinking eye. Its easier to be a sheep because sheep don’t have to think for themselves. They just bury their heads in the wooly asscheeks in front of them and follow the herd to the abattoir…
O.k., 2008 was a different story, but ever since then, about every six months I ask, “now, or should I wait?”
Why not “lock in some gains now, and wait to see what to do with some more later?” It doesn’t have to be all or nothing.
Donkey,
Why not minimize your losses now. Don’t wait to see how much more you’re going to lose. It doesn’t have to be all or nothing.
Back at ya.
I minimized my losses 18 months ago when I stopped being a landlord donkey. You may lie all you wish, but my never-changing PI does no such thing.
There isn’t a single lie on my part my friend. not one…… However you appear to be living one. A big one.
Wow. Buying at near peak bubble prices, becoming the weekend Home Despot warrior and locking in for decades of interest payments is “minimizing losses”. It’s the land I guess, 0.2 acres at 5 times yearly gross salary, that’s it.
Blue, the only part that is correct is the weekend Home Despot warrior. And that’s by choice, not by necessity.
If that’s the case, why don’t you come clean and tell us what you paid?
And so your “anonymity” excuse is taken clean off the table, make it in price per square foot.
Either substantiate your claim or continue this lying charade.
Your choice.
Why not “lock in some gains now, and wait to see what to do with some more later?” It doesn’t have to be all or nothing.”
Lock in gains on a money market account ?
Is not locking gains on ____ better than locking in on losses on a depreciating house at a grossly inflated price?
Oxy, seems to me you were touting how your lot was worth something like $300,000, and that you scored your buy at 2004 prices.
What did you pay for it in price per square foot?
I touted that the value of my lot comprised ~60% of the value of my property according to the most current tax assessment. I never gave a dollar amount.
What did you pay/sq foot?
($74/sqft)(2000sqft)=$148,000(0.60)=$88,000 lot. So you paid $60k for a average sized structure and $88k for a lot in DC?
“It’s the land I guess, 0.2 acres at 5 times yearly gross salary, that’s it.”
That’s where the bubble is- land. The cost of building houses increased a bit as material prices rose due to speculation as well as the most massive building boom the earth has ever seen, but it amounts to a rounding error when it comes to the overall price increases seen in houses. Some of these “owners” should walk the perimeter of their property several times while contemplating several hundred thousand dollars for that tiny piece of earth, and let it sink in. It’s nuts.
“Some of these “owners” should walk the perimeter of their property several times while contemplating several hundred thousand dollars for that tiny piece of earth, and let it sink in.”
Some of these non-owners should try to COMMUTE 90 minutes during rush hour, twice each day, for a couple months. Or they could walk around at night, under dangling sneakers. They might have a different view of that tiny piece of earth. And don’t forget the millions who spent several hundred thousands dollars for no earth at all.
HA, did you fail word problems in 9th grade algebra? Sure looks like it.
” COMMUTE 90 minutes during rush hour, twice each day, for a couple months…”
Uphill both ways?
Well, I admit that I did this for three years, and was a home debtor to boot. Eight lanes of daily close calls with death and road rage. I am pretty sure it was insanity.
Eventually I needed a change. If I had been seriously underwater on my mortgage, I would have been in quite the corner.
I did consider in those days that I spent three hours a day in the cubicle paying taxes, and three hours a day paying interest to the bank, just for the privilege of being a tedious little cog in a very big machine. I can’t explain how I got so far along the donkey path, but I promise you I will never go back. I do warn others from time to time, but they always take me for a fool and an idiot.
Blue, I scored a mid-late 2003 price. Adjusted for inflation it was a ~2001 price which I think of as pre-bubble. Was it a good price in absolute terms? Who knows. But from what I’ve seen so far in a relative sense, waiting for the craaaater in order to snap something up cheap will be like waiting for Godot. In that case, renting and waiting is a losing proposition.
Door #3 is not for everyone.
I did consider in those days that I spent three hours a day in the cubicle paying taxes, and three hours a day paying interest to the bank, just for the privilege of being a tedious little cog in a very big machine….I do warn others from time to time, but they always take me for a fool and an idiot.
Maybe warning them with the numbers you used above would hammer the point home? (home…pun intended)
The algebra is correct “Oxide”.
Stand still now….. Proceed.
“Blue, I scored a mid-late 2003 price. Adjusted for inflation it was a ~2001 price which I think of as pre-bubble”
Most D.C. Property Priced Out Of Reach
By D’Vera Cohn
Washington Post Staff Writer
Wednesday, November 16, 2005
“Soaring prices since the late 1990s have reshaped the profile of the typical home buyer, who is increasingly likely to be white and well off in a market where the average home sold for $450,000 last year, the report said”
“The city’s rapid run-up in prices, which rose 15.9 percent per year in real terms from 1999 to 2004, is confirmation of the city’s economic revitalization. The housing boom has helped homeowners build equity and fattened the city’s tax collections. It’s helped increase the homeownership rate: 46 percent of D.C. householders now own their homes, compared with 40 percent five years ago, according to one federal survey”
http://www.washingtonpost.com/wp-dyn/content/article/2005/11/15/AR2005111500835.html
You should wait. They want to lock you in to either miniscule gains or big risk. You will be picking up nickels in front of steam rollers and they are driving.
You will be picking up nickels in front of steam rollers and they are driving.
Will be? Everybody has been for years now. The motor is banging against the rev limiter and the only question is when the foot will slip off the clutch. But wait, there’s another nickel.
If he bought in 2008, then his gains are not “miniscule.”
And if you bought a house pre-1998, your head is just above water…… And post 1998, well……. You’ve got a problem….. A big problem….
Please Oxy, try to keep up. He has a money market fund.
You probably don’t want me to keep up.
Oxy, don’t let those paralyzed by inaction dictate to you!
I sold 50% of my stocks in Dec. 2006 (NYSE at $11,800), the other 50% of my stocks in Dec. 2007 (NYSE at $12,400). Market went to $14,200 I think in the next year.
Bought back in at $9,000 in 2009. Up almost 70% since then, plus some very nice dividends.
Bought a house for $296,000 in 2010. Sold it for $420,000 in 2013. Used the $90,000 to buy CLNY and just got my first dividend of $1600.
Burdbrain ® just sat on his HA and sucked his thumb. You gotta play to win…..and sometimes you lose, but if you’re not in the game, you only get to suck your thumb…..
“You gotta play to win…..”
This is straight mania talk. Along those lines, if you had lost 100 large on the speculation, you might be looking for someone to blame. Just sayin.
Yoo hoo….. “oxide”.
You’re running again.
(pssst…. you’ll regret suggesting anything I’ve said is untrue….. promise)
She only responds on company time.
I sold 50% of my stocks in Dec. 2006 (NYSE at $11,800), the other 50% of my stocks in Dec. 2007 (NYSE at $12,400). Market went to $14,200 I think in the next year.
Bought back in at $9,000 in 2009. Up almost 70% since then, plus some very nice dividends.’
Ok you got me there I sold some and bought Bonds but not 100%
Good timing.
I did sell my house 2006 and rented. all gains tax free still can’t believe that one.
But that’s the past whats next ?
I think the FED will eventually blow up the treasury market. After O-care I don’t think the government is competent in anything but rhetoric.
Blue Skye says
“…you might be looking for someone to blame…”
My father always said
“Never argue with success. You can’t win.”
I’ll follow my father’s advice, all the way to the bank, thank you.
You better get there quick because they want their money.
Grampa said “the higher up the tree a monkey climbs, the more his ass is exposed.”
You may have won the slots Jingle, on that spin. Go ahead and play and leverage up! It’s not going to be insight that wins or loses, it will be magical timing. We wait here for reality to enter the stage. It will be kind to us, but harsh to the players. We should be discussing the odds, not your spin.
Love the cash. Once you can get income past the tax man any income that is left over becomes yours to keep - it goes from being income to being stored wealth and stored wealth is taxed differently (if it is taxed at all) than other kinds of wealth.
A penny saved is a penny earned only after the tax man takes a whack at it.
If you were making a big bet on the market in 2008 then you were betting that the PTB - the ones in charge of the nations’s money supply - would totally lose their minds.
Which, in hindsight, turned out to be an accurate bet.
Which, in hindsight, turned out to be an accurate bet.”
yea and they haven’t changed their minds either last i checked
Well certainly if you are into treasuries and California muni bonds you pay no California income taxes on the income from them.
as soon as they get everyone back in the market they will go short and run it back down again.
Is anyone getting any crumbs from the trick down effect of a higher stock market?
I hear that the post offices in the Cayman Islands are in a boom phase.
oxide
Restoring a 1915 Colonial Revival house This is a Pennsgrove-Sears Kit Home
http://colonialrevivalrestoration.com/Inside.html
What a great project! I’m sitting out the mania, but if I WERE to have bought, that’s the kind of homestead I’d be looking for!
Tell me - is there a sense of community? Does the original (seemingly) tight knit spirit still prevail?
We all need community. Other than for the proliferating H1B clans (who live together), the illegal aliens (who hot bunk ten to a one BR apartment) and the MS-13s (who also share quarters) - here in NOVA, there really is very little of it.
jane
We are finding community by going to a free Community Thanksgiving Dinner. We’re not church types, but it is open to those without family during the holidays. No recruiting. I hear ya loud & clear.
Then I think I’ll do a Lady’s Tea and “Advanced Style” party for the gals in my neighborhood. We’re all different flavors, but who can resist a quant get-together. We own a player piano. (Conservatory Grand)
I am falling in love with kit homes. Rosemary Thorton’s blog is amazing. Check it out. Sears and Montgomery Wards (Wayward Homes) catalog kit homes, Aladdin, etc 1908-1940’s. I’m hooked. I’d love one as well, along with a Brinks truck. lol
Fuhgeddaboutit. In 2008 I was staring at $10k in cash and looked at Ford stock around that time at $1.80. GM and Chrysler were on the ropes and I knew Ford would be in a strong position in spite of the debt they held. I’m sure I wouldn’t have held 100% to see it get to $18, but still kicking myself for that one.
Also 3-4 bond funds with good yields that I missed. High “valuations” (price) now.
At least you’re honest, and I appreciate that. You could be like Jingle and concoct egregious lies, stating you bought Ford at the bottom, sold at the top, bought such and such at the bottom, sold at the top, look at me, look at me, look at me, look at me, look at me, blah, blah, blah.
If you read my posts you will see I neither sold at the top, nor bought at the bottom. I did take action in part based on Ben’s blog. I post today to offset others who forever feel there is no opportunity. There is opportunity all around. You just don’t see it…..
An opportunity to……….
…… Pay a 200% premium on a depreciating asset like you did?
You do know you paid 40-60% over construction costs don’t you?
U.S. News
Yellen: Economy Still Needs Fed Aid
By Victoria McGrane
Updated Nov. 13, 2013 11:38 p.m. ET
Cato Institute’s Mark Calabria on keys to look for in Federal Reserve chair nominee Janet Yellen’s Senate confirmation hearing, including setting out a clear Fed strategy and whether she’ll announce a tapering schedule. Photo: AP.
The U.S. economy has grown “significantly stronger” since the 2008 financial crisis and ensuing recession, and but it still needs help from the Federal Reserve as it continues to mend, Janet Yellen will tell senators Thursday.
Ms. Yellen, who has been nominated to be the Fed’s next leader, is set to speak before the Senate Banking Committee in her confirmation hearing.
“We have made good progress, but we have farther to go to regain the ground lost in the crisis and the recession,” Ms. Yellen, the Fed vice chairwoman, will say in her opening statement, according to her prepared remarks released Wednesday.
Ms. Yellen’s statement didn’t send any new signals about Fed policy. It did set up several points she might use to defend the Fed’s $85 billion-a-month bond-buying program, which is likely to draw criticism from Republicans during the hearing.
The program is aimed at lowering long-term interest rates to spur spending, hiring and investment. Many Republican members of the banking committee oppose the program because they are skeptical of its benefits and worried it will stoke excessive inflation.
In her statement, Ms. Yellen highlighted that the Fed is missing the mark on both sides of its “dual mandate” to pursue maximum employment and stable prices. Unemployment, at 7.3% in October—down from a recent peak of 10% in 2009—”is still too high, reflecting a labor market and economy performing far short of their potential,” Ms. Yellen said. Inflation is below the central bank’s 2% target and will likely remain low for some time, she said.
Ms. Yellen said both factors are motivating the Fed’s efforts to boost the economy. She said a stronger recovery would allow the Fed to stop relying on unconventional tools such as the bond-buying program. “I believe that supporting the recovery today is the surest path to returning to a more normal approach to monetary policy,” she said.
Ms. Yellen pledged to make sure the Fed uses its regulatory powers to “reduce the threat of another financial crisis,” highlighting a topic that is likely to receive significant attention during the hearing. She offered no specifics on how she saw that task being accomplished.
…
So long as the stock market keeps going up, why worry about sagging growth?
Breaking News: Jobless claims fall to 339,000 in latest week
Global shares rally on Yellen hopes, sagging growth hits euro
By Richard Hubbard
LONDON Thu Nov 14, 2013 7:37am EST
A man walks through the lobby of the London Stock Exchange August 5, 2011. REUTERS-Suzanne Plunkett
A visitor walks past logos at the Tokyo Stock Exchange in Tokyo June 13, 2013. REUTERS-Toru Hanai
A pedestrian walks past an electronic board displaying the Nikkei’s movements outside a brokerage in Tokyo October 25, 2013. REUTERS-Yuya Shino
Credit: Reuters/Suzanne Plunkett
(Reuters) - Confirmation by incoming Federal Reserve chief Janet Yellen that the U.S. central bank’s loose monetary policy was here to stay lifted world stocks on Thursday while weak euro zone data gave the dollar a boost.
In remarks prepared for her nomination hearing before a U.S. Senate Banking Committee later in the day, Yellen said high unemployment, weak inflation and an economy running below potential meant the Fed had “more work to do”.
Her comments sent the Dow and the S&P 500 .DJI .SPX to record highs on Wednesday with stock futures for both indexes pointing to further gains when Wall St opens.
“The markets are happy with Yellen’s comments,” said Michael Leister, senior rates strategist at Commerzbank. “Central bank liquidity is there, growth is low but inflation is also low, which is a pretty decent environment.”
World markets have been buffeted since May when the Fed first suggested that it could begin scaling back the $85 billion a month it is spending on bonds to support growth.
Since then, a run of mixed U.S. data has had investors constantly second-guessing the central bank’s intentions. Yellen’s remarks, which seemed to push any policy change well into next year, have ended that uncertainty for now.
Investors will still be closely watching her defense of the policy stance at the Senate hearing, scheduled to start at 10 a.m. (1500 GMT), although she is expected to stick to the prepared remarks.
The statement was enough for Asian investors to push MSCI’s broadest index of Asia-Pacific shares outside Japan up by 0.75 percent, as it bounced off a six-week low. The MSCI world index jumped 0.35 percent.
A GDP reading for Japan showing growth slowed slightly less than forecast and comments from Finance Minister Taro Aso, indicating the potential for more intervention to weaken the yen and help exporters, added to the gains.
Tokyo’s Nikkei index rose 2.1 percent after Aso’s remarks, to close near a six-month high, while the Japanese currency fell to leave the greenback up 0.5 percent at 99.815 yen, its highest level since mid-September.
EUROPE RECOVERY SAGS
European shares carried on the momentum, rising 0.5 percent by late morning, though data showing the euro area’s economy had slowed more than expected in the third quarter dented the market’s initial gains.
The euro zone economy, which only emerged from an 18-month recession in the second quarter, saw gross domestic product rise just 0.1 percent for the July to September period as output shrank in France and Italy.
The data has added fuel to speculation the European Central Bank may have to ease policy further, and knocked the euro down against the dollar by 0.3 percent to $1.3436.
CASH TAPS OPEN
In the debt market, Yellen’s statement, the soft euro zone data, and yesterday’s comments from a top European Central bank official on the prospect of bond purchases to counter a fall in inflation all supported demand.
“The euro area recovery is very fragile and that will reinforce markets’ expectations that the ECB will maintain its accommodative stance for some time,” said Nick Stamenkovic, bond strategist at RIA Capital Markets.
German Bund futures were up 15 ticks on the day at 141.53, while the cash bond yield dropped 1.7 basis points to 1.72 percent.
Benchmark 10-year U.S. Treasury yields, which initially fell below 2.7 pct after Yellen’s statement, were around 2.72 percent, down from New York’s close of 2.75 percent.
Commodities were proving equally sensitive to the signals that the Fed will keeping pumping money into the system, as the extra liquidity tends to boost investor demand.
Gold rose 0.35 percent to $1,283 an ounce, having snapped a four-day losing streak on Wednesday, though copper steadied near three-month lows to trade at $6,982 a tonne as growing supply blunted appetite for metal.
…
csco tanking this morning. WMT missed on the top line. Things arent as good as they appear.
The hype around these ipos will soon fade.
Seems like the FED is really encouraging people to take unresponsible risk. Will they be there when people lose all their money again?
“The losses associated with buying resale housing at current massively inflated asking prices is irrecoverable.
Rental rates are half the cost of buying.”
Correct.
That explains why housing demand is at 14 year lows… and falling.
A banker named Andrew Huszar that helped manage the Federal Reserve’s quantitative easing program during 2009 and 2010 is publicly apologizing for what he has done.
http://theeconomiccollapseblog.com/archives/federal-reserve-whistleblower-tells-america-the-real-reason-for-quantitative-easing
Posted yesterday but still a good one.
Time to get the TP/Occupy band back together?
Why does the crisis of conscience always come AFTER the damage is done? Sorry, but these sorts of apologies fall on my deaf ears, just like those of Wendell Potter. If this guy really cared, he would have stood up for what’s right, and walked out well before now. He’s part of the problem, and not someone to be admired.
Not always… think of Snowden…
Wasn’t it Cisco who laid off 4,000 employees a while back? I remember the day they announced the layoffs and their stock popped a few percent. So what have they done with the money they saved from axing all those long time employees? They plowed billions into a stock buyback program that lifted John Chambers into the billionaires club. The company announced plans to buy back an additional $15 billion worth of shares. Chambers is a well known contributor to politicians and anti-labor legislation including off shoring manufacturing and promoting immigration reform. Cisco lobbing has spent $900,000 so far this year.
Question how soon can cisco buy back its stock after a major announcement at the new discounted price?
Seems like companies never buy back stock when its low.
I think it’s the way Chambers unloads millions of stock options by getting the company to funnel the money into his offshore bank accounts. The guy has no morals so he sleeps well while he runs the company into the ground. I would not be surprised if he helped the NSA put backdoor access into Cisco networking gear too.
‘Cisco has shocked financial analysts — who were expecting healthy growth — by predicting a 10 percent sales slump during the current quarter. There are a variety of reasons for this, but the standout one is the backlash in emerging markets against the activities of the U.S. signals intelligence agency, the NSA.’
‘This shouldn’t have come as a surprise. Communications infrastructure is absolutely central to the surveillance scandal, and that’s Cisco’s business. An American networking firm was never going to come out of this mess well – and the whole infrastructure business is in a state of upheaval anyway — but the figures are sobering nonetheless.’
‘In the last quarter, on which Cisco was reporting on Wednesday, the company saw a sudden 21 percent revenue drop in its top 5 emerging markets: 25 percent down in Brazil, 18 percent down in India, Mexico and China, and 30 percent down in Russia.’
‘In the last quarter, on which Cisco was reporting on Wednesday, the company saw a sudden 21 percent revenue drop in its top 5 emerging markets: 25 percent down in Brazil, 18 percent down in India, Mexico and China, and 30 percent down in Russia.’
NSA actions have consequences. You rip what you sow, MOFOs!
LOL! As if the Chinese won’t use their routers for spying.
And every other country for that matter…
‘As if the Chinese won’t use their routers for spying…And every other country for that matter’
I wonder if Cisco is LOLing this morning?
I smell a little apologia for the police state. “We have no right to privacy, everybody is turning into communist China!”
What’s happening is “countries” are losing their grip on the internet. I’m a businessman. I sense opportunity naturally. If I’ve got some bucks, and know-how, I’d bet I could develop information and communications systems that are certifiably protected. Having that, the worlds corporations (and individuals) will beat a path to my door. Don’t you suppose that is happening right now?
After all, where did Cisco’s customers go?
Not only will we have privacy, we must. Everything we value depends on the right to free speech, thought and expression.
Don’t you suppose that is happening right now?
It is, I’m already hearing the rumors about a few different things. The question is how will the state respond?
After all, where did Cisco’s customers go?’
Huawei
Telecommunications company
Huawei Technologies Co. Ltd. is a Chinese multinational networking and telecommunications equipment and services company headquartered in Shenzhen, Guangdong.
‘how will the state respond’
There will always be forces opposed to freedom. But the other day I heard Lady Gaga will be doing a concert in space. The US government couldn’t keep a panda cam going. I think I know who’s going to win here.
I wonder if Cisco is LOLing this morning?
Just saying that anyone who dumps Cisco gear for Huawei will still be bugged.
I think I know who’s going to win here.
Given how the Totalitarian ChiComs are kicking our economic butts I’m not so sure I understand the relevance of Lady Gaga’s gimmicky suborbital joy ride (assuming something doesn’t go wrong and she buys the farm)
The US government couldn’t keep a panda cam going.
I’ll bet the ChiComs can.
‘are kicking our economic butts’
This isn’t saying much, when the elites set up the WTO, our government lets them in and many of our jobs move over there. Anyway, China is sitting on a gigantic bubble.
‘the relevance of Lady Gaga’s gimmicky suborbital joy ride’
What I’m saying is that private companies have the ability to fly a singer out to space. The US doesn’t even have a space program anymore, because the government can’t afford it. Heck, they can’t even fix the potholes on I-40.
I talked to a guyin CO today that informed my there is a south park valley- not littleton after all- I learn something every day
What I’m saying is that private companies have the ability to fly a singer out to space.
How much did it cost to buy the plans for the spaceship from the US government?
“Not only will we have privacy, we must. Everything we value depends on the right to free speech, thought and expression.”
I protect my privacy by not using Facebook, Google+, etc., and by setting up many different e-mail accounts with no personal information. People who are pasting their whole life online are foolish, IMO.
People who are pasting their whole life online are foolish, IMO.
Or you can take the John Hancock approach.
“So what have they done with the money they saved from axing all those long time employees? They plowed billions into a stock buyback program that lifted John Chambers into the billionaires club.”
C’mon, this is bootstrapping 101, man! This guy’s got a family to feed. You know how hard it is to get by on a measly $600 million? Nothing wrong with minting some billionaires at the expense of a few thousand families here and there, right? It’s the American dream!
Seems like companies never buy back stock when its low.”
APACHE did that’s why I bought them
Sacramento Market;
http://cl.exct.net/?ju=fe5e1c72706505747513&ls=fe1b1d777d6c017e741275&m=fefc1172766306&l=fed1157376640678&s=fe35157277640d7d711074&jb=ffcf14&t=
I guess those shanties in n highlands got a little pricey?
So long as the stock market keeps going up, why worry about sagging growth?”
They are so boxed in they won’t do anything but cheap money ( and they chided japan for this ) until the market gets tried of it and finds another reserve currency.
Then rates will rise and it will be a disaster.
Meanwhile, across the pond…
Europe Recovery Wanes as Germany Slows, France Contracts
By Stefan Riecher - Nov 14, 2013 2:59 AM PT
Kristian Helgesen/Bloomberg
Gantry cranes and shipping containers stand on the dockside beside the Maersk Mc-Kinney Moeller container ship in the Port of Bremerhaven, Germany, Nov. 11, 2013.
The euro area’s recovery came close to a halt in the third quarter as German growth slowed, France’s economy unexpectedly shrank and Italy extended its record-long recession.
Gross domestic product in the 17-nation euro area rose 0.1 percent in the three months through September, cooling from a 0.3 percent expansion in the second quarter, the European Union’s statistics office in Luxembourg said today. That’s in line with the median forecast in a Bloomberg News survey of 41 economists. Growth in Germany, the region’s largest economy, eased to 0.3 percent from 0.7 percent.
The slowdown comes as the currency bloc struggles with the legacy of a debt crisis now in its fifth year and just after it emerged from its longest-ever recession in the second quarter. Unemployment stands at a record 12.2 percent and inflation slowed to the lowest level in four years in October, leading the European Central Bank to cut its benchmark rate to a record low last week.
“The bleak GDP estimate shows just how fragile and hesitant the eurozone’s recovery is — so much so that it’s questionable whether current economic conditions even qualify as a recovery,” said Nicholas Spiro, managing director of Spiro Sovereign Strategy in London. “While the slowdown extends to Germany, it’s the dire state of the French and Italian economies that looms large.”
…
“The euro area’s recovery came close to a halt in the third quarter as German growth slowed, France’s economy unexpectedly shrank and Italy extended its record-long recession.”
The sun rises in the east.
“The deflationary spiral rages on…… whatever you do, stay out of debt and hold onto your cash.”
You better believe it mister.
Gundlach: Wall Street the ‘only game in town,’ but I won’t buy high
November 14, 2013, 7:54 AM
Just hours before Fed Chairwoman nominee Janet Yellen starts to warm her seat at the Senate Banking Committee, the bulls are roaming, even if stock futures are playing it cool.
Heard so far on Thursday, in the wake of those prepared Yellen remarks, DoubleLine Capital co-founder Jeffrey Gundlach says Wall Street is “the only game in town.”
However, before you race to your broker, note that Gundlach is hesitant to pour fresh money into U.S. stocks because, in his words, he doesn’t like “buying high”.
…
It is impossible to lose anymore buying stocks.”
Yesterday I read some bozo on Yahoo recommending CISCO
U can still lose buying stocks.
realtors are liars
Realtors are financial terrorists
Realtors will DESTROY you, avoid Realtors.
Don’t let this happen to you:
http://www.youtube.com/watch?v=hPIxrzmatq0
Realtors are “grossly misleading to the American public”.
the national association of realtors is a satanic pedophile death cult
“Mortgage Defaults Skyrocketing”
http://www.billsbills.com/blog/mortgage-defaults-skyrocketing-hamp-has-failed
Default is what happens when the price of housing is grossly inflated.
So no credit card cramdowns for the unlucky people who still have a criminal discover card interest rate?……(not me)
——————
It’s too bad a mortgage cramdown isn’t available on mortgages for main residences to force subprime interest rates down to reasonable levels.
So no credit card cramdowns for the unlucky people who still have a criminal discover card interest rate?……(not me)
What incentive do the bankers have for doing that? Why would they leave money on the table?
None but i guess it was all to “help” out dumbo homeowners.
its just so pitiful how all this turned out….it would have helped the economy a lot if CC interest rates were zero for 5 years…
Will Democrats and Tea Partiers Derail Obama’s Secret Trade Deal?
An unlikely group of 174 House lawmakers signaled their opposition to giving the president special powers to sign a trade deal without congressional input.
By Erika Eichelberger
Wed Nov. 13, 2013 8:10 AM PST97
The Obama administration is nearing the end of negotiations on the biggest free trade deal in US history, the Trans Pacific Partnership (TPP). The stakes are high: The pact affects the United States and 11 other countries, domestic policy areas ranging from intellectual property rights to product safety and environmental regulations, and $26 trillion in annual economic output. But in order to secure the deal, President Barack Obama says he wants Congress to grant him permission to sign the final trade agreement, which Congress has not yet seen, without congressional input. A coalition of about 174 conservative Republicans and liberal Democrats in the House signaled this week they would likely vote against giving those trade powers to the president.
The US trade representative Michael Froman and Obama want to finalize the TPP by the end of the year and are pushing Congress to pass legislation soon that grants the president something called fast-track authority, which would allow him to sign the final trade agreement without Congress making any amendments to the pact. If Obama gets what he wants, Congress may not even be able to read the final version of the massive trade deal in its entirety until after lawmakers have signed away their rights to influence it. At that point, the two chambers will only be allowed an up-or-down vote to implement the international pact into domestic law. The administration says fast-track authority will assure other countries that the deal the United States has committed to after three years of negotiations won’t be dismantled by American lawmakers who dislike some of the provisions. No major trade agreement has been finalized without it.
http://www.motherjones.com/politics/2013/11/fast-track-authority-obama-trans-pacific-partnership - -
I hope they derail it. We’ve been through this too many damn times. Overseas country gets our jobs, buys a few token products to pretend that they are a “new market,” and then counterfeits the crap out of IP.
The most basic economic model says that two truly free traders will both increase their profits. However, if one side becomes protectionist and other remains a free trader, the free trader actually loses and the protectionist has yet larger gains.
However, if one side becomes protectionist and other remains a free trader, the free trader actually loses and the protectionist has yet larger gains.
can you explain in some detail why the protectionist would have larger gains?
Huge trade surplus.
You’re probably thinking “but consumers in those countries” will end up paying more.
They will, but that is not a metric they use to measure success.
Huge trade surplus.
i’m asking how the trade surplus or larger gains happen.
i’m asking how the trade surplus or larger gains happen.
You import lots of manufactured goods, but import very little. Witness the Chinese care market. You want to sell cars in China? Then you have to build them there, with a high percentage of Chinese content.
China is super protectionist, and they are handing our heads to us on a platter.
You import lots of manufactured goods, but import very little.
?? i think you meant to put ‘export’ on one of these?
what method would you use to target your imports/exports?
Look at the Chinese, they target pretty much everything, steadily moving up the food chain. Now they’re starting to make airliners. Sorry Boeing, Airbus, they won’t be needing your airplanes anymore and they will eventually be good enough to compete with you in international markets.
?? i think you meant to put ‘export’ on one of these?
Correct
Look at the Chinese
no, i want to look at your explanation of how protectionism results in trade surplus and profit gains, over free trade.
Correct
i’m guessing you meant the first ‘import’ to be ‘export’.. if that’s so, how would you effect it?
GDP = C + G + I + NX
where:
“C” is equal to all private consumption, or consumer spending, in a nation’s economy
“G” is the sum of government spending
“I” is the sum of all the country’s businesses spending on capital
“NX” is the nation’s total net exports, calculated as total exports minus total imports. (NX = Exports - Imports)
GDP is commonly used as an indicator of the economic health of a country, as well as to gauge a country’s standard of living. Critics of using GDP as an economic measure say the statistic does not take into account the underground economy - transactions that, for whatever reason, are not reported to the government. Others say that GDP is not intended to gauge material well-being, but serves as a measure of a nation’s productivity, which is unrelated.
tj: no, i want to look at your explanation of how protectionism results in trade surplus and profit gains, over free trade.
I’M not asserting that two protectionists trading with each other have any net benefit. MY point is that a free trader trading with a protectionist loses, while the protectionist wins.
The theory is thus:
• Assume two countries Sugaria and Chipia. Assume they both have two industries, sugar manufacturing and computer chip manufacturing.
• Assume Sugaria is better at making sugar and Chipia is better at making computer chips.
• In free trade, Sugaria focuses its resources on sugar, resulting in more sugar, higher quality sugar and lower prices. Chipia focuses its resources on making computer chips, resulting in more computer chips, higher quality computer chips and lower prices.
• Sugaria’s chip industry atrophies, while Chipia’s sugar industry atrophies. These industries can’t survive in the teeth of superior competition from the other country’s superior prize industry.
• But Sugaria’s sugar industry supplies both its sugar needs and Chipia’s sugar needs. And Chipia’s computer chip industry also supplies both countries’ chip needs. The theory says both countries are better off this way.
• But, let’s say Sugaria slaps a tariff on Chipia’s chips and protects its (Sugaria’s) chip industry. Its chip industry grows and supplies a larger amount of its own chip needs, while still supplying sugar to itself and to all of Chipia resulting in net gain. For Chipia, the result is a net loss in the chip trade but no gain in the sugar trade.
THAT is how a protectionist trading with a free trader wins.
I’M not asserting that two protectionists trading with each other have any net benefit. MY point is that a free trader trading with a protectionist loses, while the protectionist wins.
Exactly. We are basically one of the few chumps … I mean, free traders, left. Everyone else jealously protects their markets and industries and does everything possible to discourage and prevent imports. And while they accumulate their trade surplus $$$ we go deeper into debt to buy goods from them.
Critics of using GDP as an economic measure say the statistic does not take into account the underground economy - transactions that, for whatever reason, are not reported to the government.
what critics seldom mention is that GDP is not an accurate measure of the economy for other reasons also. for instance, GDP went up after katrina, but did that indicate a better economy? NO! things had to be bought that were destroyed. that money could have been saved and invested or spent on other things. i’ve said on this blog many times that GDP isn’t the economy. as you alluded to, it’s a more accurately a measure of consumption.
Others say that GDP is not intended to gauge material well-being, but serves as a measure of a nation’s productivity, which is unrelated.
as i’ve just shown you, it’s not even a good measure of productivity. it’s a better measure of consumption. and sometimes the consumption isn’t for good reasons, but for bad.
I’M not asserting that two protectionists trading with each other have any net benefit.
i didn’t claim you said anything like that.
MY point is that a free trader trading with a protectionist loses, while the protectionist wins.
and my contention is that both partners lose even if only one is protectionist. however, the one practicing the protectionism loses the most.
Sugaria’s chip industry atrophies, while Chipia’s sugar industry atrophies. These industries can’t survive in the teeth of superior competition from the other country’s superior prize industry.
there’s no reason why this would happen. how is it in this example that both countries have a ’superior prize’? normally, one would be better than the other. but both should prosper if they make each prize efficiently.
But, let’s say Sugaria slaps a tariff on Chipia’s chips and protects its (Sugaria’s) chip industry.
then sugaria must pay higher prices for chips. this will impact them domestically. also, the tariffs don’t help the sugar industry unless it’s getting kickbacks.
Its chip industry grows and supplies a larger amount of its own chip needs,
but it costs their citizens more money. less to spend on other things, including sugar. their chips cost more money because they were less efficient at producing them. they should have been allowed to go out of business. they would have no doubt tried newer businesses. some of them would have probably taken root.
while still supplying sugar to itself and to all of Chipia resulting in net gain.
it’s going to be a net loss.
For Chipia, the result is a net loss in the chip trade but no gain in the sugar trade.
chipia will find other partners. yes, they will have been hurt. but they won’t have been hurt as much as surgaria who imposed the tariffs.
THAT is how a protectionist trading with a free trader wins.
protectionism always produces a net loss for those that engage in it. it’s counter intuitive, but true.
Neuromance: Sugaria’s chip industry atrophies, while Chipia’s sugar industry atrophies. These industries can’t survive in the teeth of superior competition from the other country’s superior prize industry.
tj: there’s no reason why this would happen. how is it in this example that both countries have a ’superior prize’? normally, one would be better than the other. but both should prosper if they make each prize efficiently.
The atrophy of a local industry does happen in real life. Look at the US TV and appliance manufacturing, and manufacturing of computer chips and the like. The driving concept is “comparative advantage”: http://www.wto.org/english/res_e/reser_e/cadv_e.htm ; And when a sufficiently strong comparative advantage exists, as we’ve seen with white goods manufacture, the local industries disappear.
Neuromance: But, let’s say Sugaria slaps a tariff on Chipia’s chips and protects its (Sugaria’s) chip industry.
tj: then sugaria must pay higher prices for chips. this will impact them domestically. also, the tariffs don’t help the sugar industry unless it’s getting kickbacks.
So, yes, there is a cost from the higher prices and/or lower quality chips. But there is a benefit from higher employment and technological advance from having that industry in the country.
Will the benefits of increased employment and having technological know-how and the ancillary benefits that yields outweigh the reduced benefit from the local chips? We have a lot of real world data to determine this. THIS is the core question. Sometimes the answer is yes and sometimes no, depending on how much a net cost (or net benefit) protecting the industry yields.
A homogeneous economy is less stable than a heterogeneous one as a shock which impacts a major industry will have larger effects.
Also, not everyone is smart or focused enough to have a high-intellectual-requirement job - and there’s nothing wrong with that. As a society, we need a system to provide jobs for all. Or we get all manner of social ills. If there is welfare, that has all manner of social ills. Not having jobs or income also has a set of consequences and resulting social ills.
Neuromance: THAT is how a protectionist trading with a free trader wins.
tj: protectionism always produces a net loss for those that engage in it. it’s counter intuitive, but true.
Looked at another way, a protectionist trading with a free trader is a form of “Mercantilism”, outright beggar thy neighbor policies, a common relationship between an colonizing country and a colony. It’s vastly favorable for the colonizer and quite negative for the colony.
The atrophy of a local industry does happen in real life.
yes, but happens for many reasons. industries shouldn’t be protected any more than house prices should be protected.
The driving concept is “comparative advantage”:
i know about comparative advantage. i discussed it here back in the days when ‘eddie’ was posting. comparative advantage doesn’t explain how protectionism builds surpluses or profits. that’s what i’m asking you to explain.
But there is a benefit from higher employment and technological advance from having that industry in the country.
not if the industry is inefficient or obsolete.
tariffs don’t raise employment, they raise unemployment.
Will the benefits of increased employment and having technological know-how and the ancillary benefits that yields outweigh the reduced benefit from the local chips? We have a lot of real world data to determine this. THIS is the core question. Sometimes the answer is yes and sometimes no, depending on how much a net cost (or net benefit) protecting the industry yields.
did we benefit from the protection of the housing industry? or from the protection of the car industry unions? or from cash for clunkers?
it doesn’t matter what the industry is, if it needs protection to survive, it should die and let a new industry rise from the ashes. consider a dying industry as fertile soil for a new industry, or at least a new company.
A homogeneous economy is less stable than a heterogeneous one as a shock which impacts a major industry will have larger effects.
yes, of course. the problem arises when they think know what the industries of an economy should be. they don’t, can’t and never can.
As a society, we need a system to provide jobs for all.
the system is called the free market and it’s the only thing that works.
Not having jobs or income also has a set of consequences and resulting social ills.
then get the government out of the markets and let them produce the wealth that creates jobs.
It’s vastly favorable for the colonizer and quite negative for the colony.
colonizing the way you mean it has nothing to do with free markets. it has to do with conquering.
it doesn’t matter what the industry is, if it needs protection to survive, it should die and let a new industry rise from the ashes. consider a dying industry as fertile soil for a new industry, or at least a new company.”
That’s the big experiment the USA is running now , lets see what happens. Except big banks and Insurance companies they need to be protected because … I have no idea
GDP = C + G + I + NX’
Sorry that’s all I got I’m no economist. Governments tweak the NX component to boost GDP.
Two basic questions are:
1) Is what we’re doing, a free trader trading with protectionists, like allowing ourselves to be victims of Mercantilism?
2) Is encouraging / protecting industries like textiles, white goods, electronics manufacturing going to result in a net increase in employment and standard of living or decrease it?
Remember the Bangladesh factory collapse? Or the Bangladesh factory fire? It’s like the Triangle Shirtwaist fire - those working conditions exported to another part of the world. Companies shouldn’t be able to do that.
We can not yet match the lack of environmental and worker protection laws, and low wages that occur with lower standards of living. Does that mean our industry and the accompanying jobs and income should be eliminated?
I think conflating housing price supports and the Wall Street rescue with encouraging manufacturing here is a mistake. These are two completely separate issues.
I do see the point that an industry that makes inferior products or more expensive products imposes a cost on the society. But one of the reasons the tax breaks didn’t work so well is that injecting money into our economy injects a little to the middlemen but a lot goes out of the country to the manufacturers. Few claim that industry here makes inferior products, just that it cannot compete on cost with poorer locations in the world with laxer worker and environmental protections. Is that a legitimate reason to allow an industry to die here? Does that increase employment or improve standard of living or serve any other national interest at all?
cactus: it doesn’t matter what the industry is, if it needs protection to survive, it should die and let a new industry rise from the ashes.
We have to ask, “Why is the industry dying?”
1) Is another manufacturer able to produce a more desirable product? Like better quality cars for example? Or cars with features Americans want?
2) Is the industry being rendered obsolete by the march of technology?
3) Or is it environmental and/or worker protections that are being undercut in another locale, and we’re just de facto exporting the Triangle Shirtwaist plant there?
If it’s the first two, creative destruction can probably in the long run lead to higher living standards. If it’s option 3, then it probably does not serve our national interest to simply export labor and environmental abuses to other countries.
Option 3 is like an executive saying, “Oh yeah? You want labor and environmental protections? I’ll just move my factory so I don’t have to deal with you pesky Americans.” See the abuses in Bangladesh to see the issue writ large.
1) Is what we’re doing, a free trader trading with protectionists, like allowing ourselves to be victims of Mercantilism?
no, the best we can do is trade with those who will trade with us, without conditions on our part.
2) Is encouraging / protecting industries like textiles, white goods, electronics manufacturing going to result in a net increase in employment and standard of living or decrease it?
you say “encouraging/protecting” like they are the same thing. they’re not. encouraging would be removing barriers. protecting is erecting them. remove barriers and don’t be afraid to let the chips fall where they may.
It’s like the Triangle Shirtwaist fire - those working conditions exported to another part of the world. Companies shouldn’t be able to do that.
they really don’t. we don’t like to see sweat shops, children working etc. but we only got on our high horse about those things when we became wealthy enough not to need them. we became so wealthy that our children no longer needed to work. but back when we were building our wealth, kids needed to chip in to help the family. most put in long hours on the farm. no one thought anything about it. no we judge others who are less fortunate. those who are grateful to be able to earn anything. they are in impoverished situations. we shouldn’t be judging them. our nation went through similar things when we were poor.
We can not yet match the lack of environmental and worker protection laws
they will change when they can afford to. no one wants those kinds of conditions. when you fully understand how wealth is built, you won’t fear competition from lower wage workers. if someone built something cheaper than we can, they are adding to the wealth of the world and we should just move on to making something different, something better.
and low wages that occur with lower standards of living.
give them freedom, property rights and personal rights like we used to have and they will catch up quickly.
Does that mean our industry and the accompanying jobs and income should be eliminated?
we don’t need to eliminate anything. just let markets take their course..
I think conflating housing price supports and the Wall Street rescue with encouraging manufacturing here is a mistake. These are two completely separate issues.
yes, that’s what i told you above regarding ‘encouraging/protecting’.
one of the reasons the tax breaks didn’t work so well is that injecting money into our economy injects a little to the middlemen but a lot goes out of the country to the manufacturers.
injecting money into the economy is keynesian philosophy that just doesn’t work. attempting to do so just causes the misallocation of capital. it’s just more screwing around by know-it-alls that hurts everyone.
Is that a legitimate reason to allow an industry to die here?
yes. if we have free market capitalism, new kinds of industry will take its place. there were many people that thought we should protect buggy whips back in the day. can’t lose those buggy whip making jobs you know.
Does that increase employment or improve standard of living or serve any other national interest at all?
yes, a dynamic economy needs to be sensitive and respond to market input. creative destruction and all that. everything is naturally moving all the time. we shouldn’t try to hold it in place. employment, wages and standard of living all increase with a growing, strengthening economy. industries are born grow and die. new ones will take their place if government gets out of the way. right now, in this country, we are doing the wrong things. protectionism will just hurt us more.
I was looking at the Super Zip link from yesterday… interesting stuff.
At least I grew up in a Super Zip. Hmm,perhaps I need to relocate to one.
http://www.washingtonpost.com/sf/local/2013/11/09/washington-a-world-apart/
I was looking at the Super Zip link from yesterday… interesting stuff.
At least I grew up in a Super Zip. Hmm,perhaps I need to relocate to one.”
Zombies roam the darkened areas..
There be dragons…
WikiLeaks Releases Full Text Of Secret Trans-Pacific Partnership Agreement (TPP)
By majestic on November 13, 2013 in News 0
The perceived ills of the Trans-Pacific Partnership Agreement (TPP) has been well documented here at disinformation, but until now the text has not been publicly available. WikiLeaks has rectified that:
Today, 13 November 2013, WikiLeaks released the secret negotiated draft text for the entire TPP (Trans-Pacific Partnership) Intellectual Property Rights Chapter. The TPP is the largest-ever economic treaty, encompassing nations representing more than 40 per cent of the world’s GDP. The WikiLeaks release of the text comes ahead of the decisive TPP Chief Negotiators summit in Salt Lake City, Utah, on 19-24 November 2013. The chapter published by WikiLeaks is perhaps the most controversial chapter of the TPP due to its wide-ranging effects on medicines, publishers, internet services, civil liberties and biological patents. Significantly, the released text includes the negotiation positions and disagreements between all 12 prospective member states.
The TPP is the forerunner to the equally secret US-EU pact TTIP (Transatlantic Trade and Investment Partnership), for which President Obama initiated US-EU negotiations in January 2013. Together, the TPP and TTIP will cover more than 60 per cent of global GDP. Both pacts exclude China.
Since the beginning of the TPP negotiations, the process of drafting and negotiating the treaty’s chapters has been shrouded in an unprecedented level of secrecy. Access to drafts of the TPP chapters is shielded from the general public. Members of the US Congress are only able to view selected portions of treaty-related documents in highly restrictive conditions and under strict supervision. It has been previously revealed that only three individuals in each TPP nation have access to the full text of the agreement, while 600 ’trade advisers’ – lobbyists guarding the interests of large US corporations such as Chevron, Halliburton, Monsanto and Walmart – are granted privileged access to crucial sections of the treaty text.
The TPP negotiations are currently at a critical stage. The Obama administration is preparing to fast-track the TPP treaty in a manner that will prevent the US Congress from discussing or amending any parts of the treaty. Numerous TPP heads of state and senior government figures, including President Obama, have declared their intention to sign and ratify the TPP before the end of 2013.
WikiLeaks’ Editor-in-Chief Julian Assange stated: “The US administration is aggressively pushing the TPP through the US legislative process on the sly.” The advanced draft of the Intellectual Property Rights Chapter, published by WikiLeaks on 13 November 2013, provides the public with the fullest opportunity so far to familiarise themselves with the details and implications of the TPP.
The 95-page, 30,000-word IP Chapter lays out provisions for instituting a far-reaching, transnational legal and enforcement regime, modifying or replacing existing laws in TPP member states. The Chapter’s subsections include agreements relating to patents (who may produce goods or drugs), copyright (who may transmit information), trademarks (who may describe information or goods as authentic) and industrial design.
The longest section of the Chapter – ’Enforcement’ – is devoted to detailing new policing measures, with far-reaching implications for individual rights, civil liberties, publishers, internet service providers and internet privacy, as well as for the creative, intellectual, biological and environmental commons. Particular measures proposed include supranational litigation tribunals to which sovereign national courts are expected to defer, but which have no human rights safeguards. The TPP IP Chapter states that these courts can conduct hearings with secret evidence. The IP Chapter also replicates many of the surveillance and enforcement provisions from the shelved SOPA and ACTA treaties.
The consolidated text obtained by WikiLeaks after the 26-30 August 2013 TPP meeting in Brunei – unlike any other TPP-related documents previously released to the public – contains annotations detailing each country’s positions on the issues under negotiation. Julian Assange emphasises that a “cringingly obsequious” Australia is the nation most likely to support the hardline position of US negotiators against other countries, while states including Vietnam, Chile and Malaysia are more likely to be in opposition. Numerous key Pacific Rim and nearby nations – including Argentina, Ecuador, Colombia, South Korea, Indonesia, the Philippines and, most significantly, Russia and China – have not been involved in the drafting of the treaty.
In the words of WikiLeaks’ Editor-in-Chief Julian Assange, “If instituted, the TPP’s IP regime would trample over individual rights and free expression, as well as ride roughshod over the intellectual and creative commons. If you read, write, publish, think, listen, dance, sing or invent; if you farm or consume food; if you’re ill now or might one day be ill, the TPP has you in its crosshairs.”
Current TPP negotiation member states are the United States, Japan, Mexico, Canada, Australia, Malaysia, Chile, Singapore, Peru, Vietnam, New Zealand and Brunei.
Read the full secret TPP treaty IP chapter here
http://disinfo.com/2013/11/wikileaks-releases-full-text-secret-trans-pacific-partnership-agreement-tpp/ - 90k
“We’ve got to pass it to see what’s in it”.
If the Senate and House do not derail this POS, they deserve all the contempt they are going to get.
But guess what? In the upcoming elections, nothing will change.
The two avenues to change this corrupt devolution into fascism is to
1) consistently vote the incumbents out. That’s John Nash math talking.
2) get rid of 80% of the captive voting bloc - that is to say, the bloated, metastasizing federal bureaucracy.
I’ve got this foreboding that the body politick is now at the target idiocy level - they are not willing to connect the dots. That’s what happens when you subsidize breeding among the permanent underclass.
Yes, I am racis and ignorantis. We need a century of mortal challenge to weed out those who cannot subsist without a gummint tit. On both ends of the spectrum. At the point where ‘civilization’ is once again short of people who can actually do things in the kinetic world, they will once again be valued.
(Disclosure - I recently re-read Barbara Tuchman’s ‘A Distant Mirror’).
God have mercy on us.
It’s nice to know that you can be abroad and come back to find everything the same. People are still fat, buying houses they can’t afford, and the printing presses rolling. We just need that 17% VAT that Europe has.
“Houses are never investments. They are depreciating assets.”
Exactly.
Warning indicator ??
https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&ved=0CC8QqQIwAA&url=http%3A%2F%2Fwww.bloomberg.com%2Fnews%2F2013-11-13%2Fhud-said-to-fail-in-bid-to-sell-450-million-of-bad-mortgages.html&ei=Rd2EUp2iDaGAiALAkoCQCw&usg=AFQjCNEkV4Zkgerag_hVw0kn87iXaY2Ylg&sig2=TcOAdc6b7OyxS-oTlPnmKA&bvm=bv.56343320,d.cGE
“In a time of universal deceit-telling the truth is a revolutionary act.”
George Orwell
the most transparent administration in history
http://www.picpaste.com/download-php-pQCq9kZV.jpeg
“Disobedience is the true foundation of liberty. The obedient must be slaves.”
HD Thoreau
“When is housing massively overpriced? It’s quite simple. When the price of the house is in excess of the cost to build (lot, materials, labor and profit), less depreciation for a used house.”
Exactly. No need to confuse it. The cost to build is right around $55/sq ft, with profit.
“Any fool can make a rule, and any fool will mind it” - H.D. Thoreau
Patton: Now I want you to remember that no bastard ever won a war by dying for his country. He won it by making the other poor dumb bastard die for his country.
“Disobedience is the true foundation of liberty. The obedient must be slaves.”
Reminds me of that California surfer with a SNAP card. He’s doing his part to “dis the man” and drag down the system, and have a great time doing it.
Here is one for mortgage slaves:
“But men labor under a mistake. The better part of the man is soon plowed into the soil for compost. By a seeming fate, commonly called necessity, they are employed, as it says in an old book, laying up treasures which moth and rust will corrupt and thieves break through and steal. It is a fool’s life, as they will find when they get to the end of it, if not before.”
Thoreau
“Strange times are these in which we live when old and young are taught falsehoods in school. And the person that dares to tell the truth is called at once a lunatic and a fool.”
~ Plato
http://simplicitycollective.com/thoreau/thoreau-on-shelter
“…the cost of a thing is the amount of life which is required to be exchanged for it…”
Try to avoid Florida sinkholes if you can.
Sinkhole reported in yard in Florida
AP 8:14 a.m. EST November 14, 2013
Story Highlights
The hole appears to be about 12-feet wide
Homes on both sides have been evacuated
Part of a patio has caved in and a boat is on the edge of the hole
DUNEDIN, Fla. (AP) — Residents of several Florida homes have been evacuated due to a possible sinkhole that opened in a backyard near St. Petersburg early Thursday.
Dunedin Deputy Fire Chief Trip Barrs said the hole appeared to be about 12-feet wide when officials arrived on the scene. Residents of the neighboring houses also were evacuated as a precaution.
Television footage showed that part of a patio has caved in and a boat is on the edge of the hole. Tampa area television stations report that a neighboring pool appears to have cracks.
Sinkholes are common in Florida because the peninsula is made up of porous carbonate rocks such as limestone that store and help move water underground. Over time, the rocks can dissolve from an acid created from oxygen in water, creating a void under the limestone roof. When dirt, clay or sand gets too heavy for the limestone roof, it can collapse, creating a sinkhole.
On Feb. 28, Jeffrey Bush died when a sinkhole opened under his bedroom in Seffner, Fla., near Tampa. His body was never recovered. In August, sections of a building at a resort near Orlando collapsed into a sinkhole. No one was injured in that sinkhole.
Homeowner Michael Dupre said the family heard a noise that sounded like a sledgehammer pounding on the wall early Thursday morning.
Dupre told Bay News 9 there had been “sinkhole activity” in the area. “After the Seffner sinkhole, we were scared. We’ve been dealing with our insurance company and finally two days ago, they started working on our house. Now it looks like our house is gone.”
…
Sinkhole opens up in Florida, swallows portions of 2 homes
Published November 14, 2013
FoxNews.com
Residents are evacuating from a Florida neighborhood after a sinkhole opened up, swallowing parts of two homes, according to authorities.
The sinkhole in Dunedin is about 35-feet wide, Fire Chief Jeff Parks told Fox 13. The station said the sinkhole is expanding and also has damaged a pool and a boat.
“It started swallowing everything around it. We were home. We were sleeping. My daughter woke us up,” homeowner Michael Dupre said, noting that the ordeal began around 5:15 a.m. local time and sounded like a sledgehammer pounding on a wall.
…
And California EarthCraters…
Try to avoid Florida sinkholes if you can.
And the DMV. You guys are right, Florida does have the best stories!
Florida man charged with indecent exposure after allegedly masturbating at West Palm Beach DMV
As Adam Carrola always says…anything really nasty or freaky always comes from Germany or Florida…
12 November 2013
Eerie beauty in America’s long-forgotten spaces
Photographers Daniel Barter and Daniel Marbaix’s pictures of deserted buildings in the north-eastern states of the US show once-grand edifices slipping into terminal decline. The pair’s eerie portraits of emptiness have been collected in a book, States of Decay, published by Carpetbombing Culture in the UK this month. (Daniel Barter)
I like that last photo of the worker’s boots. Likely didn’t own ‘em; had to remove them at the end of the shift for the next shift’s worker. Gotta wonder if the company charged rent?
Athletes foot delivered with it for free. The gift that keeps on giving!
Got rising foreclosures?
Chicago-area foreclosure filings rise in October
By Mary Ellen Podmolik Tribune reporter
11:05 p.m. CST, November 13, 2013
Foreclosure filings in the Chicago area rose 30 percent in October from a month earlier but remained well below their year-ago level, RealtyTrac reported.
In an area from Kenosha, Wis., to Northwest Indiana, 3,442 new foreclosure actions were filed last month, the company reported. That compared with 2,653 in September and 5,496 in October 2012.
Overall foreclosure activity in the Chicago area dropped for the eleventh consecutive month, falling 5 percent in October from a month earlier and 35 percent from a year earlier.
Nationally, October foreclosure activity declined 28 percent from a year ago, but rose 2 percent from September, largely because of a 10 percent increase in scheduled auctions in states where courts process foreclosure cases.
“Lenders are likely moving these properties more rapidly to the public auction, given that there is strong demand from institutional buy-to-rent investors at the auction and that rising home prices mean more of the losses can be recouped, either by selling to an investor at the auction or by repossessing the property and reselling (it) as bank-owned,” Daren Blomquist, a RealtyTrac vice president, said in a release.
A rigged economy, rigged media, paid PR proxies posing as J6K….
We’re fu*ked.
“A rigged economy, rigged media, paid PR proxies posing as J6K…”
+1 LOL ’cause it’s true!
inventory has dropped in my hood 22151. Financed w your tax dollars.
Same around my hood — 92127 Rancho Bernardo. Nothing much for sale or for rent to speak of, and prices are back up near 2006 levels.
This “low inventory” but rising price dynamic played out around Phoenix about a year ago. Once it appears prices are rising people come out of the woodwork to list their houses thinking they can get out with some profit. Seeing dollars signs the flippers also join in to bid prices up. Then the inventory sits at the higher prices. Then price reductions begin.
I think a lot of areas are just at different points on the timeline.
Zilldo sez the Zestimate of the place we rent is only $10K under what the owner/investor paid in late 2004, while the Rent Zestimate is $200 over our current rent. The LL’s are itching to either sell next year or get us to cough up more rent.
Thanks a lot, Zilldo — your estimates are looser than a hooker’s underwear.
“your estimates are looser than a hooker’s underwear.”
http://www.zillow.com/howto/DataCoverageZestimateAccuracy.htm
The median error is about 10% for their home values…and similar for rent…
“…about 10% for their home values…”
In otherwords, they sux.
$600,000 +/- 10% = $500,000 to $700,000 — a spread of about 4X the median San Diego County pretax household income.
Looser than a hooker’s undies…
Never post mental maths while seeing red!
Trying again … $540,000 to $660,000. The spread is much wider than the downpayment that almost any end-user buyer could dream of coming up with unless they beg, borrow, steal, or earn it by being born a trust fund baby.
Only HALF of their zestimates fall within that range…which means HALF are even worse.
It’s why the “zestimates” Zillow produces aren’t very useful for an individual home…more useful are the pieces of data that they produce through the aggregation of lots of pieces of data (their paired sales analysis to estimate the direction of markets is much more valuable than their “opinion” on one home).
Given their estimates are so sucky, maybe they should post them? They give landords like mine greed-crazed ideas about how much they could sell for if only they could kick out the tenants.
P.S. That said, the Zestimate shows my landlords are still underwater compared to when they bought in 2004, and that after nine years of inflation to compound their losses if correctly stated in real dollars.
“shouldn’t post them”
Good grief! I need to edit more carefully…
Either not post them, or have a big asterisk right next to the value with a notation: +/-15% margin of error
That would make it less offensive…
or get us to cough up more rent
It’s still a relatively free country. If you don’t like your rent, no one’s stopping you from finding a cheaper place to live.
You should have taken your own advice…..
So let’s settle this once and for all…… What did you pay for the shack in price per square foot?
I already told you. $74.
$74*2000sqft(avg).
You paid roughly $148k for a house in DC?
I’ll give you another chance to tell the truth “Oxide”.
How much did you pay for the house in price per square foot?
Don’t run. Don’t fib. Just answer the question truthfully.
The LL’s are itching to either sell next year or get us to cough up more rent.”
That’s the age old problem in Coastal CA.
In my nabe, they can get higher rents but it takes a 2-3 month vacancy to get it.
The smart landlords are keeping their tenants at the existing rate, in our case $200 per month “below market.” Turnover here is too high (1-2 years) to assume you can make it up over the long term.
In Whac’s case it sounds the LL can no longer afford to feed the alligator.
In Whac’s case it sounds the LL can no longer afford to feed the alligator.”
yes stop feeding the Alligator they may want to get out “even”
resistance level
A price at which a security or the market itself will encounter considerable selling pressure. A resistance level is formed when investors purchase large amounts of a security just before a decline and then resolve to sell the security should it again reach the level at which it was purchased. Technical analysts believe that an additional supply of a security will tend to keep its price from rising above the resistance level. Also called overhead resistance level. Compare support level. See also overhanging supply.
If they get out today, they get out “underwater,” especially if you throw in all the ownership costs they have incurred plus the Realtor®’s commissions, plus losses in nominal dollar terms that look even bigger if you factor in Fed-engineered inflation since 2004.
95050-95054 inventory has Ben low for years now…
Here’s a snapshot of inventory of 95054… Now does it look like “low inventory” to anyone here?
I didn’t think so. Save it finocch….
http://picpaste.com/pics/1ad2f89b6618ec00bb025a7fcdc4f221.1384459736.png
Our selling season is pretty much dead now. Foggy skies and drizzle dampen the mood, and next month we’ll be frozen solid. Waiting on that ground hog’s shadow.
Commercial real-estate item.
The Blues is back in town. Austin’s famous Antone’s blues club has been sold to a group of investors that include a geneticist who is the director of the National Geographic Society’s Genographic Project and Peter Griesar, who played keyboards in the Dave Matthews Band.
Antone’s was the home of the blues in Texas and helped launch the careers of Stevie Ray Vaughan (one of the truly great blues guitarist) and the Fabulous Thunderbirds. I once booked T-Birds band leader Kim Willson to a gig in Ft. Worth and he still ranks as one of the best blues harmonica players alive. Let’s hope they bring back some soul back to the heart of Texas.
Jack Smith AKA Bluestar
Last day to vote in the Biggest Energy Saver contest!
http://www.biggestenergysaver.com/vote/
I’ve never been to Austin but I love the blues. It’s my understanding that Antone’s club moved several times over the years, so I guess there are several former Antone’s to re-invigerate. Sue Foley got her start there as well. Jimmie Vaughn, Lou-ann Barton, Angela Strehla (sp?) were the house band at one time. Marcia Ball had her big birthday bash there a couple of years ago (with special guest Delbert McClinton). Duke Robillard was in Cincy this summer preparring for his tour with Bob Dylan and I caught his act.
Yes, Blues lovers know Antones. Good to see it’ll keep the music strong.
There’s where Stevie started. I think Lou Ann and he was in the same group early on.
I don’t remember SRV & Barton being in the same group but they did do a legendary jam at the Bluebird lounge back in 79′. The Bluebird was a club owned by Robert Ealey, one of the original Ft. Worth blues legends (RIP). http://www.robertealey.com/
I was a friend of Robert from 1990 till he passed.
Jack Smith AKA Bluestar
“A Corporate Trojan Horse”: Obama Pushes Secretive TPP Trade …
http://www.youtube.com/watch?v=CS-x5SlcPPM - 130k - Cached - Similar pages
Oct 4, 2013 …
“Comment by Whac-A-Bubble™
2013-09-03 19:17:50
“Corelogic”
They’ve been real estate whores since day 1. I once called up a guy on the telephone who worked for them — Christopher Cagan — to discuss the bubble situation. By the end of the conversation, he dismissively informed me that I was a ‘bubble head’ and terminated the call. (This was way back in 2005, before the ginormous crash we collectively predicted — LOLOLOLOLOZZZZZS!!!!)
————————————————————————-
A reminder to the reading public:
Dismiss anything WhoreLogic has to say about housing.
He’s also a religious fundie, which doubtless helps maintain his belief that “real estate always goes up without bubbles.”
Denver Post - Doctors are doubling down on obesity:
“The medical profession has issued new guidelines for fighting the nation’s obesity epidemic, and they urge physicians to be a lot more aggressive about helping patients drop those extra pounds.
Doctors should calculate your body mass index, a weight-to-height ratio. And if you need to lose weight, they should come up with a plan and send you for counseling.
More than a third of U.S. adults are obese, and that’s been the case since the middle of the last decade. Officials define someone with a BMI of 30 or higher as obese. A 5-foot-9 person would be obese at 203 pounds.
The guidelines were released this week by a group of medical organizations that include the American Heart Association, the American College of Cardiology and the Obesity Society.”
Why lose weight? Everything will be paid for if something goes wrong health wise.
Doctors should be encouraging smoking and eating more fatty foods the way dentists encourage bit o honeys.
The title of this article made me hungry for a Double Down:
http://en.wikipedia.org/wiki/Double_Down_(sandwich)
Sumthin’ happened to the term “fat and prosperous”.
Being fat used to be considered a good thing, it used to mean you are well fed. Now it just means you are fed.
interesting infographic details what foods people eat based on income and education:
http://www.businessweek.com/articles/2013-11-12/you-are-what-you-eat-and-you-eat-what-you-earn
We use to be junk food types do to our careers and time restraints. Then we got
the health “religion” (read books), started to live on whole foods (an occasional chocolate treat), and bought a treadmill for daily workouts. Now we are fit and thin.
It isn’t education or income per se as much as a desire to live healthy. Feeling like crap sucks. That chart is bs. I know MDs and other highly educated professionals who are obese. Nuff said. But thank you, goon, for sharing that nonsense.
I want pics of that bikini body.
Coo coo coo choo, Mrs. Robinson
“….health religion…..”
Yep……..a religion that is highly intolerant of disbelievers/non-worshippers.
It’s funny. Instead of believing me, the overweight wrench-turner with 35 years in the corporate jet maintenance game, owners/buyers would rather believe the fit/trim/tanned, sales/consulting sleazeballs when it comes time to buy airplanes.
And they ALWAYS end up getting screwed, at which time yours truly starts getting calls, to try to salvage the mess.
Jetfixr
I have a friend of 35 years who is now morbidly obese. Still friends even though she can barely move. That’s not us.
“…believe the fit/trim/tanned, sales/consulting sleazeballs when it comes time to buy airplanes.”
Fools. Anyone who doesn’t listen to the technical source is a shallow fool.
owners/buyers would rather believe the fit/trim/tanned, sales/consulting sleazeballs when it comes time to buy airplanes.
Those are the guys making big bucks in high tech while the rest of us grind out and make the actual product as well.
Those are the guys making big bucks in high tech while the rest of us grind out and make the actual product as well.
Oh yes. Here at the Broomfield campus there are frequent sales droid training sessions in the large conference rooms on the bottom floor of building 5. These folks must have grown up in Lake Wobegon, because from a looks perspective, they are all above average. And they are paid “alot” more than the Principal Engineers who lead the design teams that create the products they sell.
They are definitely cut from a different cloth. Sometimes I’ll walk buy when they are on a break from class, and overhear them chatting with customers on their mobile phones. They are suave and silver tongued, to say the least.
They are definitely a different class of people. I always wonder if they learned it or were born into it.
Fixr… go paleo… please.
And yes Carl I am very familiar with the type. They are the reason that I keep a faith in some form of afterlife. Because karma sure ain’t gonna show up in this one.
I too have the right weight for my height. I am at 171 lbs. and it allows me to do more pullups and pushups. If I had 15 lbs of extra flab it would certainly make me feel like an oaf. Just had a physical yesterday.
See your doctor(s) regularly
See your dentist regularly. Floss.
A little bit of chocolate is healthy and the dark chocolate is best. I eat a 50 calorie chocolate per day.
“If you pay current massively inflated asking prices for resale housing, you’ll get ripped off so excessively that you’ll never recover financially.”
You can say that again.
How many suckers have we heard about right here on the HBB in just the last few years that overpaid by $200k or more?
September 23, 2013 Jordan Bailey
We live in a country where the majority of people are inundated by news. Whether newspapers, television, or radio, the mainstream media infiltrates our lives one way or another. Unfortunately for us, they’re managing to use the immense power granted to them by politicians and corporations to distract us from or desensitize us to America’s problems.
The mainstream media is a powerful tool in the belts of giant corporations who seek to shape our country into whatever will benefit their profits. What used to be a collection of more than 50 companies, power and control of our news outlets has been condensed to 6 mega huge corporations — News Corp, Disney, Viacom, Time Warner, CBS, and Comcast — who work in conjunction with various political figures to literally decide what news is delivered to the public, and what level of truth is behind that news. They control everything we watch, read, and hear in regards to the news.
Scary, right?
This is a particularly troubling problem because it’s creating a public filled with ill-informed people.
Some have suggested that by constantly feeding us biased news carefully crafted by these corporations, the public is becoming brainwashed to think the way they want us to think. We’re being brainwashed to only care and discuss the topics they want us to care about and discuss.
Perhaps it’s no coincidence that there’s been little discussion about the damaging effects “free trade” is having on our economy. Instead, news agencies are reporting on issues not relevant to our economy.
There are so many things wrong with America, in Congress and with our presidential administration that the media simply isn’t reporting on because if they did, the U.S. public would be protesting in the streets and questioning the economic decisions of our leaders. Many have suggested that greedy corporations don’t want that.
Even though 70 percent of Americans are against “free trade,” corporations support the government and their quest for “free trade” because they make a lot of money from “free trade” agreements while the rest of the country suffers. That’s why the media doesn’t report when Americans gather to protest “free trade” agreements, they simply ignore it. They feed the public a slew of distractions to direct attention off of the real problems.
The media does this on purpose, because having an oblivious crowd of people mindlessly following them is exactly what President Obama and other prominent government figures, lobbyists and multinational corporations want. Having an oblivious public means those currently causing America harm with “free trade” agreements can continue to suck the life from this great country while simultaneously selling away the wealth of future generations to countries like China.
By buying out all of the major media outlets, damaging agreements like President Obama’s Trans-Pacific Partnership (TPP) and Transatlantic “free trade” agreement (TAFTA) are not being talked about. The media is ensuring the public doesn’t find out President Obama is negotiating the TPP and TAFTA in secret, because if we knew what was in the agreements, we’d surely protest.
Wake up America! We cannot allow this to continue!
http://economyincrisis.org/content/wake-up-america-we-are-being-brainwashed-by-the-mainstream-media - 60k -
Is anyone else thoroughly sick of being told to “wake up?”
Kinda. It is annoying have to listen to all the snoring plus that, too.
Do not awaken the sheeple: A cautionary tale: http://xkcd.com/1013/
This one’s for Joe Smith and all the other bootstrappers getting rich ripping off taxpayers:
http://www.washingtonpost.com/investigations/va-called-it-a-small-business-contract-but-a-big-firm-got-90-percent-of-the-money/2013/11/13/d9a88018-b663-11e2-92f3-f291801936b8_story.html
Government contracting = $500,000,000,000+ a year.
Feds drool, contractors rule!
Joe is not getting rich, he is helping slime get rich, if you believe his posts. He did not even claim to be a partner. Thus, his motto appears to be “dirty deeds done dirt cheap”.
Joe is probably at least in the top 2% of median national incomes. That’s not rich for metro D.C. but a lot (alot) more than the Lucky Ducky half of the workforce that make less than $500/week.
And regarding “helping slime get rich”, those slime are the bootstrappers, the rugged individualists, the American exceptionalists, taking America back, restoring our future, manifest destiny, born in a log cabin, Tippecanoe and Tyler too, peace in our time, flags and eagles and mom and apple pie, the job creators.
Regards,
goon.squad.ctr@xxx.xxx.mil
* note the “.ctr” stands for contractor
Article about pot vaporizers and secretly getting high in public:
http://nypost.com/2013/11/14/pot-vaporizers-let-professionals-get-stoned/
One of the squadettes told me she brought one on an airplane and got high in the restroom.
Just toured a bank owned house that has been for sale for almost a year. Price is still the same ($350K, suburban Maryland). Realtor said the bank refuses to drop the price. During the tour I noticed it needed all new windows (half were cracked single paned), new roof (small hole getting larger by the day) new siding, new garage door and from my amateur inspection it looked like part of the foundation was cracking.
Inside was a nightmare. Top to bottom it needed everything. Everything. Not much was salvageable, but here is the Agent “Oh that’s a $10 fix…..that’s just a can of paint and an afternoon……that’s a simple fix also”
The shame of it is that it would be, foundation aside, a good house to rehab and have someone live in it, but it will eventually be sold to a flipper. I’m picturing a Baby Boomer couple with Trump dreams of making so much money off of this house. Unless you can get the bank you cut that price drastically someone is going to lose a lot of money on that place.
Make the offer and stand over the liars shoulder when she puts it in writing for the bank.
It sounds like a $25k deal.
Got that from my realtor too. They must have paint-sniffing parties in the office, they love it so much. We could ask inchbyinch if realtors are trained to worship paint.
“Got that from my realtor too”
What else did you “get” from your realtor? I hope you got tested so you don’t give it to your boyfriend.
Is he a he-she from brazil?
oxide
I do shopping centers. U-San Diego/ICSC Mgmt School. Did all the classes for SFH later on before we bought. We always bought new, and resale was a new animal to us. Had to know about the resale “game”.
Luckily, our buyer’s broker was a LL and knew light construction. He was fabulous. Even put on his jeans and helped us rip out carpeting and take down funky paneling. When we had a medical emergency, he helped me unload stuff to the dump. A mensch. A RARE find in the reic.
now it’s “light construction”. lolz
What’s it feel like to make a $200k mistake?
oops, “lite”. Thanks HA.
No mistake. Happy and secure w/ no payment or rent for life.
One day oxide will be here as well.
Feels fantastic!
Overpaying by $200k was intentional huh?
Riiiiight…. sucker.
take down funky paneling.
He must not have been a true realtor. They always want to paint the paneling white. After I bought the house, the realtor invited me to one of her other open houses to show how the sellers had painted the paneling white in the rec room downstairs. It looked merely ok.
The “third bedroom” in our house has paneling painted white. We use it as a home office/library/storage. There are so many bookcases and pictures that we can’t see much of the painted paneling. Maybe some day we’ll change it, but it has worked for us for 23 years+. It is definitely the lazy way to cover wood paneling.
Good evening Knitting Club…..
Our realtor came over w/ a saw, a hammer, floor stripping devices, wearing work clothes and helped us. He enjoys helping nice buyers. He doesn’t help self absorbed yuppie types.
This house had 26 dogs living here. (breeder) No wonder she got Dementia. The stench from pee was even in the paneling and sub-flooring. Just gross.
.
And your contractor worked for nothing too…
We understand Donkey.
HA
It pays to have good karma. We are feeding the homeless during the holidays. No religious affiliation either.
And you young man?
And the current owner has dementia too.
Sean
We bought a one-story w/ pool fixer from a Dementia Patient Trust: (our final home)
Roof to flooring and everything else between is brand new. Even w/ our GC friend’s license - this place was expensive.
We could not get insurance (and we were cash) unless the house was up to code. Everything in the house was trashed and look like a frat party gone wrong.
The bank might be dreaming, but then again, I am not privy to the micro market data.
Fixers aren’t just cosmetic. We had to update the outlet behind the stove and drop an icemaker line from the attic. The electrician even had to put in missing electrical boxes in the attic. It was a “what now?” the first 2 weeks. EE hubby was hyperventilating.
But we’re staying put and are happy. We’ve owned a luxury home, but this is by far our favorite retreat. (our 3rd and last)
inchbyinch u ever hike up to the cross near the Reagan library ?
You can park at the library hike down the road a bit cross over to the access road and hike right to the big Cross with a view of all Simi.
cactus
Haven’t done that. Should we?
Before they built Long Canyon out in the back of Wood Ranch, we use to hike back there. It was a good workout.
More affirmation of the squad’s ever-correct prediction that the future belongs to Lucky Ducky
Associated Press - Share of young US adults who move hits 50-year low:
“U.S. mobility for young adults has fallen to the lowest level in more than 50 years as cash-strapped 20-somethings shun home-buying and refrain from major moves in a weak job market.
The new 2013 figures from the Census Bureau, which revered earlier signs of recovery, underscore the impact of the sluggish economy on young people, many of them college graduates, whom demographers sometimes refer to as “Generation Wait.”
Oh you’ll be waiting alright. That B.A. in Obama Studies wasn’t such a good idea, now was it? Enjoy the rest of your life in mom’s basement, LOOSERS!
Oh you’ll be waiting alright. That B.A. in Obama Studies wasn’t such a good idea, now was it? Enjoy the rest of your life in mom’s basement, LOOSERS
Or at least until, Mom’s house gets sold in a foreclosure.
Free Sh*t Army recruits in the making.
The article also notes that “Among college graduates 25 and older, Denver and Washington, D.C., topped the list of destinations.”
I don’t want more people moving here, but at least the ones that do are more edumacated. All the mouth-breathers and window-lickers can move to Texas, they’ll feel right at home there
Goes to prior posts that say
The number of excess homes is dwarfed by the number of excess rooms to sleep in and this number is dwarfed by the number of excess beds that can be crammed into these rooms. This number is dwarfed by the number of cardboard boxes that can be converted to street condo’s.
My 20 something year old sister who can’t get a job in her field despite good grades is living in our spare bedroom and I know a lot of people who have 20-30 yo kids still at home.
‘In a scenario unfortunately reminiscent of the lead up to Iraq, the National Security Council tasked the various intelligence agencies to beat the bushes and come up with more corroborative information. Israel obligingly provided what was reported to be interceptions of telephone conversations implicating the Syrian army in the attack, but it was widely believed that the information might have been fabricated by Tel Aviv, meaning that bad intelligence was being used to confirm other suspect information.’
‘With all evidence considered, the intelligence community found itself with numerous skeptics in the ranks, leading to sharp exchanges with the Director of Central Intelligence John Brennan and Director of National Intelligence James Clapper. A number of analysts threatened to resign as a group if their strong dissent was not noted in any report released to the public, forcing both Brennan and Clapper to back down. This led to the White House issuing its own assessment, completely divorcing the process from any direct connection to the intelligence community.’
“fabricated by Tel Aviv”
That’s unpossible.
And you better watch your mouth, or Abraham Foxman will put your name on “the list”.
Do we have a ship like the Liberty we could put off the coast so we could intercept the signals directly? O never mind.
“DUNEDIN—A large sinkhole opened in a residential neighborhood early Thursday, damaging two homes and forcing the evacuation of residents in the 1000 block of Robmar Road.”
http://www.tampabay.com/news/publicsafety/sinkhole-in-dunedin-neighborhood-prompts-evacuation/2152376
Interesting — I just looked at sat photos. The pool next door appears to be empty/green is several photos. I have a friend in Clearwater, not far from here, who is stressing over a depression in her backyard. She suspects a leaking pool, but all of her neighs have a pool and they have no idea which one it could be.
Lordy, can you imagine if an abandoned house next door agitated a pre-existing sinkhole that swallowed your house?
http://picpaste.com/sink-1HvT8URC.jpg
http://picpaste.com/sink2-PXkXGkgN.jpg
Sorry, I forgot to authenticate…
http://picpaste.com/DSC04127-CNNwbq95.jpg
The monopoly wants it’s money and it wants no competition.
http://finance.yahoo.com/news/utility-solar-company-battle-over-153647922.html
Again an arguement for socializing or highly regulating transmission companies and allowing a free market in terms of power generation. Currently if you own the lines you control the game.
‘”Ho-hum” is the word DataQuick used to describe the housing market in California’s Bay Area last month. Home buyers borrowed $3.0 billion in mortgage money. The most active lender was Wells Fargo with almost 15 percent of the market. No other lenders cracked 5 percent.’
‘Adjustable rate mortgages (ARMs) still figure prominently in the California real estate market. These loans accounted for 20.5 percent of the Bay Area’s home purchase loans in October. That was the highest since 20.7 percent in August 2008. It was up from a revised 20.2 percent in September, and up from 11.8 percent in October last year.’
ARMs, when fixed interest rates are a hair’s breadth from all time lows. Heaping stupid on top of foolish.
ARMs are super scary if they are being used as affordability tools (which is MOST of the time)–during the 2005-2007 timeframe, the flashing red light to me in the Bay Area was that the most common loan was an Option ARM…at that point, I wonder what percentage loans were ARMs in the Bay Area? Since the average since 2000 was 47%, it must have been WAY above 50% during the height of the bubble.
I do know a few people that use ARMs simply because their view is that over long periods of time, the premium to fix a rate is too great…and they could write a check to pay back the loan the instant the rate got too high. But that is the exception, rather than the rule…
In the meantime, back at the Subprime Ranch….
http://tinyurl.com/mcjjcd3
“Countrywide Liar Loans and Chiropractic Clinic” Oh yeah, this should turn out well.
And remember “Interest only” loans? Another $##tstorm is clouding the horizon….
http://tinyurl.com/kkgl5ku
“….about $30 billion in home equity lines dating to 2004 are due for resets next year, $53 billion the following year, and a staggering $111 billion in 2018…….
Talked with my cousin last night. She LOVES Obamacare.
Seems that her company has the government contract for Obamacare ID verification.
What’s that saying rattling around in my head? Something about “……contractors RULE!..”
She must work with a lot of ex Acorn employees.
No…….she is smack dab in the heart of the Producers-not-parasites/Bootstrapping/Corporate Wet-dream called Texas……..DFW Metro to be exact.
From a Drudge link to Politico
“We have our own proposal, which we think is really good,” Pelosi said at a forum sponsored by the Washington Ideas Forum, sponsored by the Atlantic. “I think that we’ll see in the next 24, 48, 36 hours something to the effect of how do we accommodate those people” who have faced cancellation of their health plans
I think I know what the fix will be. Nancy’s botox will no longer be covered by Obamacare, saving billions that will subsidize payments to the insurance companies so they will not have to raise premiums on 60 year old men to cover pregnancies.
Interesting how these people operate. They don’t say, we’re going to propose a bill. They just say, we’re going to unilaterally amend a law. Unions want out? We’ll decide. Big business gets a break, we decided. Pick and choose what parts of a law to enforce, or not.
What kind of a banana republic is this anyway?
What she’s really saying is, “Please don’t throw me out on my ass voters! Please give people back plans we told you to cancel!”
Squeal Nancy. Squeal like a pig!
Squeal Nancy. Squeal like a pig!
Gee, thanks for that visual!
i bet nancy pelosi is a wild animal in bed.
That’s hideous.
In other news….
“Have You Been Smoking Pot? Denver Police Have a New Way to Tell: The ‘Nasal Ranger’”
http://www.alternet.org/news-amp-politics/have-you-been-smoking-pot-denver-police-have-new-way-tell-nasal-ranger
Yes, a wild animal. Like a Turkey Buzzard.
And doing it with Dianne Feinstein would be like making it with a moldy bag of wet sawdust.
Ben, Congress doesn’t always have to vote to change a law. Many times the actual law just passes off the finer details of the law to a regulating agency. For example, several agencies wrote the Qualified Residential Mortgage QRM Rule (law) as authorized under Dodd-Frank.
I read that some details of Obamacare are passed off to K Sebelius and HHS in the same way. Acceptance rules for grandfathering plans might be under HHS, and could be easily changed without a vote from Congress.
Do you really think that Nancy is in electoral danger?
Rumor is that she was texting all during a performance of “If/Then” (currently doing a pre-B’way run) downtown. Her district just *might* be pissed at her for being that rude at a theater, but not enough to kick her out.
The only way Pelosi gets voted out of office is if somehow SF becomes Bizarro SF. In this universe, she has her seat for as long as she wants it (and would probably win if she were dead).
All these fossils in DC are on their last leg. McCain, Hillary, etc.
‘if somehow SF becomes Bizarro SF’
‘In the months leading up to the 2012 presidential election, Silicon Valley was squarely in President Obama’s corner.’
‘Google’s executive chairman coached Obama’s campaign team; executives from Craigslist, Napster, and Linkedin helped him fundraise; and when the dust settled, Obama had won nine counties in the liberal and tech-heavy Bay Area, scoring 84 percent of the vote in San Francisco. But a little over a year later, following explosive allegations from former NSA contractor Edward Snowden that the government is exploiting tech companies to spy on Americans, some members of Silicon Valley are taking a new perspective: “F— these guys.”
‘That’s what Brandon Downey, a security engineer with Google, wrote late last month, upon learning that the NSA had broken into Google and Yahoo and was exploiting the data of millions of users, allegedly without the companies’ knowledge. He added, “We suspected this was happening, [but] it still makes me terribly sad. It makes me sad because I believe in America…The U.S. has to be better than this.”
Squeal Nancy!
I saw that earlier today–I don’t think it means Pelosi is in danger, but it’s nice to see the shine come off the Obama in the hearts of techies.
It reminded me of a conversation I had with a left leaning tech guy (one of my best friends) before the election. I encouraged him to read Woodward’s book BEFORE the election…he did. In his own words, he was disappointed. I think he thought of the candidates and MSM spin about fiscal issues/wranglings quite differently afterwards…
I don’t think it means that he voted for Romney (I think for him, social issues outweigh fiscal…I’m the opposite), but at least he didn’t put his head in the sand and place Obama on a pedestal as someone who could do no wrong.
What caused him to read it is that I told him that Obama in the office meant no solution to deficits (because he has NO relationship with the right), which could lead to inflation, which would benefit the wealthy guys in the room at the expense of the poor and working class. Obama still has 3 years to prove me wrong, but he’s not on any track to do so yet.
But that is the problem we have gone from delegating creating the “fine details” to delegating the core substance of the law to Executive Branch. This scope of delegation would have been considered unconstitutional not too long ago. A similar problem has arisen in Europe where bureaucrats working for the EU have more power than the legislative branches of the individual countries.
PS add to the that the giving to the President the ability to waive requirements of the law without defining the limitations and criteria for granting waivers and you have a law that concentrates power away from the people and invites corruption. It is just one step away from third world countries where the legislature makes someone the President for life. It makes a mockery of democracy.
If they can do what you like with the stroke of a pen, they can do what you don’t like also.
What kind of a banana republic is this anyway
Your question answers itself. The PTB do what they want. The plan under Bush and Obama is to create a north American union, with US law being usurped by a treaty. The US auto companies are already busy moving their production to Mexico but they will soon not to have to worry about border crossing since a border will not exist between the US and Mexico. The new citizens they are trying to create will vote for the union. If you object to the takeover they have created the paramilitary organization to crush any opposition. Finally, they are purging from the military anyone that will stand up for the constitution.
Dan, I wonder how you sleep at night.
I sleep well because I have learned the difference between worrying about what I can do something about and what I can do nothing about.
But think about it. If the super rich just wanted cheap labor they would just pass a plan where people could work but not become citizens. Poor citizens just might vote for a higher minimum wage. They want these people to be able to vote. Why? Bush actually said that America was not a country but something like an idea. Mexico has been creating the infrastructure to move more goods from south to north. Despite having the money to complete the fence nobody will do it. Even NAFTA did not follow the constitutional process it is a “treaty” not ratified by the Senate but passed in the same manner as an ordinary law. The PTB want something like a European Union and they will force us to accept it even if it means changing the population.
Of course you can just accept the billionaires’ word that amnesty will be good for the country:
http://www.breitbart.com/Big-Government/2013/11/12/Wal-Mart-CEO-contradicts-company-s-support-for-amnesty
The longer the border is kept open, the more illegals come here and more children they have (”anchor babies”) which are automatically US citizens.
Demographics is destiny. No need for anything more complex than leaving the border open.
True but I am in no hurry to rush the process. It is not like any law supported by the PTB will close the border. If you legalize the illegals then they can bring in their relatives through family unification. BTW, while we presently grant citizenship automatically the constitution is not clear about that since just crossing the border should not mean that the parents are not subject to a foreign sovereign.
BTW, it is interesting on how our view has changed on the issue and this “creation” Native Americans that live here for thousands of years were not considered citizens just because they were born here and it took the passing of law to confirm them as citizens.
Now, because it suits corporate interests there is automatic citizenship for anchor babies because the mother violates the law and slips through the fence.
From Wikipedia:
The Indian Citizenship Act of 1924, also known as the Snyder Act, was proposed by Representative Homer P. Snyder (R) of New York and granted full U.S. citizenship to America’s indigenous peoples, called “Indians” in this Act. (The Fourteenth Amendment already defined as citizens any person born in the U.S., but only if “subject to the jurisdiction thereof”; this latter clause was thought to exclude certain indigenous peoples.) The act was signed into law by President Calvin Coolidge on June 2, 1924.[1][2][3] It was enacted partially in recognition of the thousands of Indians who served in the armed forces in WWI.”
If you do any research you will see that it is very rare for a country to grant citizenship just for being born in the country. So why do we just accept the concept of anchor babies? Could it be that the PTB that want to break down the nation state have brainwashed the sheep to believe that no other interpretation of the constitution is possible and there must be no showing that the parents were no longer sovereign citizens of another country for the birth to confer citizenship?
I don’t know much about Mexico, but I can promise you there is no worry that Canada will be absorbed into the US. They would consider this an absurd idea.
That guy Busch, he was a real genius!
Often what seems impossible is just a little harder to accomplish. If Mexico and US were to unite how would Canada compete? The lower wages in the combined country would make its auto exports and many other goods uncompetitive. It would be swamped by imports. Many of the skilled unemployed might migrate to Mexico or the US, and soon the border would be blurred.
You know I figured out Iran-contra months before the story broke. I saw F-14 parts going to Iran from Israel as reported in Aviation Week. The thing was Israel never flew F-14s. I saw weapons flowing from Israel to Nicaragua. Despite publicly supporting Iraq, I knew we were helping Iran with Israel’s help and it was tied to Israel helping us evade prohibitions put on by Congress. It was a crazy theory until it was not. Not that Congress was right since I knew that Nicaragua’s denial of arming rebels in El Salvador was bs but that is another story. Fast forward, and I can tell you Osama Bin Laden was on my radar and feared as an adversary long before 95% of America even knew his name. But I also knew his legitimate complaints. Globalization is an attack of Islam just like it is an attack of Christianity. Anything which slows down the willingness of countries to join a common government needs to be destroyed. Having different values based on religious traditions is an impediment to creating one world government.
The story about the Snowden releases above shows just how far our country’s leaders will go to promote globalization over the wishes of the people. While what is going on the Middle East, our economy and the Mexican border may all seem like separate issues but they are not. It is all about achieving, eventually, one world government. The PTB intend to achieve it by slowing cooking the frog (us).
Bush was not a fool and neither is Obama but for their own reasons they both have accepted that one world government is a positive even if fools still like having their own nation states that reflect the values created by history, religion and yes perhaps genetics.
The story about the Snowden releases above shows just how far our country’s leaders will go to promote globalization over the wishes of the people.
Perhaps for billionaires to become trillionaires more than one country worth of J6Ps is required.
‘there is no worry that Canada will be absorbed into the US’
30 years ago, I read a copy of the Trilateral Commission magazine at the university library. It was clear; set up a union of states in Europe, do the same in the Americas, and in Asia. Once established, bring them all together for a world government. Not some conspiracy web site. This was their words, and they’ve never really hid it.
I don’t know how far it will get. They got the WTO, which was pretty big. But the Asian union hasn’t gone very far, and beyond NAFTA, the north American thing hasn’t changed a lot.
They play a long game, thinking in terms of decades, and if need be, decades more. Remember the Common Market?
‘The European Economic Community (EEC) was an international organization created by the Treaty of Rome of 1957.[1]‘
‘Its aim was to bring about economic integration, including a common market, among its six founding members: Belgium, France, Italy, Luxembourg, the Netherlands and West Germany. The EEC was also known as the Common Market in the English-speaking world and sometimes referred to as the European Community even before it was officially renamed as such in 1993.’
‘It gained a common set of institutions along with the European Coal and Steel Community (ECSC) and the European Atomic Energy Community (EURATOM) as one of the European Communities under the 1965 Merger Treaty (Treaty of Brussels).’
‘Upon the entry into force of the Maastricht Treaty in 1993, the EEC was renamed the European Community (EC) to reflect that it covered a wider range of policy. This was also when the three European Communities, including the EC, were collectively made to constitute the first of the three pillars of the European Union (EU), which the treaty also founded. The EC existed in this form until it was abolished by the 2009 Treaty of Lisbon, which merged the EU’s former pillars and provided that the EU would “replace and succeed the European Community.”
http://en.wikipedia.org/wiki/European_Economic_Community
I saw that movie “Skin Game” last night and it reminded me of scams I learned about housing/investing from this site. I’d never seen Louis Gisset with hair.
Nov. 14, 2013, 6:02 a.m. EST
Internet bubble is California’s next big quake
Commentary: Warning signs are all around the San Francisco Bay Area
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By Therese Poletti, MarketWatch
SAN FRANCISCO (MarketWatch) — Many people in the San Francisco Bay Area — from commuters on congested freeways, to people trying to buy or rent a home, to investors looking at tech stocks — believe we are in another Internet bubble.
San Francisco especially seems to be in the throes of dot-com bubble 2.0. Real estate prices are skyrocketing, tenant evictions are climbing, and blog posts are decrying the advent of a $4 plate of toast. KQED’s Forum, a popular radio program on NPR, is doing a series called “Priced Out” about the soaring cost of living in the Bay Area. The city is becoming one of haves and have-nots.
Wednesday, news that Facebook Inc. (FB -1.14%) made an offer to buy mobile app company Snapchat, where users can send short-lived texts or photos, for $3 billion in cash, and was rebuffed, will likely renew concerns about frothy valuations in the social media sector. Twitter Inc.’s (TWTR +3.09%) successful initial public offering, will also unleash more newly minted millionaires in San Francisco early next year after the employee lock-up period expires.
The Twitter IPO is already fueling more real-estate insanity, with home owners or developers gutting and flipping once-stately Victorians or other style older homes, to turn them into bland McMansions for the nouveau riche, in the same design vein as their sleek and sterile open offices. A four-bedroom Edwardian home in San Francisco’s popular Noe Valley for example, purchased in 2012 for $1.2 million has been gutted and modernized, and is now on the market for $2.8 million. The prevailing view among some local architecture fans is that the techies are ruining much of the city’s historic architecture.
Some data is not yet confirming that we have returned to the dot-com bubble levels of 1999. Indeed, some aspects of the last boom may not be revisited this time around. Not every company being founded is imitating the revenue-free business model of Snapchat or Pinterest, the social scrapbook company. But still, the fact that a company like Snapchat is getting a $3 billion plus valuation with no current revenue should be a red flag.
Other warning signs are evident. A review of initial public offerings in the first nine months of 2013 by Dealogic showed that in general, the IPO has come back. In the U.S., total IPO volume was $34.9 billion for the first nine months, with 149 deals, up 6% from the same period in 2012. Activity was the highest since 2007, when the U.S. had a total of 170 IPOs, before the economic recession killed many deals. Real-estate companies have been the IPO leader this year, followed by health-care and technology firms.
Venture capital data from Silicon Valley is showing that tech is taking up most of the VC investments at the moment, and that health-care investing has fallen. Data from research firm CB Insights’ Silicon Valley Venture Capital Almanac showed that venture funding in the third quarter of 2013 was the strongest in five years. In the third quarter, VCs invested $2.8 billion in 267 tech startups.
The Internet sector gobbled up more than 40% of venture capital funding in both 2012 and in the first nine months of 2013. Funding of mobile companies grew to 15% in 2013, so far, up from 7% in 2010. Health care and cleantech fell to 24% of Silicon Valley VC funding, down from 29% in 2012.
“Tech is increasingly taking most of the VC dollars,” said Anand Sanwal, CEO and co-founder of CB Insights. “But in terms of dollars there is no way that it is going to approach that (the record levels of 2000). VC as an asset class has been shrinking.”
…
believe we are in another Internet bubble.
I don’t keep up with the happenings in Silicon Valley as much anymore but here in the Silicon Forest, software engineering is all the rage.
What I don’t get is how many of these, “we help businesses optimize their online experience through open-sourced social media solutions” start-ups do we really need? I welcome the competition, but it seems like a new one pops up here every week and all of them do the same thing, or at least sound like they do.
Oh brother, not the “solutions” propaganda again.
Maybe trickle down DOES work (kinda, until it doesn’t).
i.e. - Methinks it’s a case of too much .01%-er VC money finding a home in SW development start-ups.
i.e. - Methinks it’s a case of too much .01%-er VC money finding a home in SW development start-ups.
It must be the hope of converting an investment in the low millions into a multi billion IPO jackpot that keeps then coming back.
Stock market live blog: Yellen says stocks aren’t in bubble territory
November 14, 2013, 8:22 AM
Welcome to MarketWatch’s live blog of the stock market. We’re kicking it off before the jobless claims data on Thursday. Ahead: Yellen testimony and the market reacts to Cisco. Want to point something out? We’d love to hear from you in the comments or directly at lmandaro@marketwatch.com.
stocks aren’t in bubble territory
Well, she would know. Question is, where does she plan to take us that she’d finally consider things bubbly?
Real Estate
Where the Next Huge Real Estate Bubble May Be Building
By Christopher Matthews @crobmatthewsNov. 12, 2013
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The 2000s real estate bubble—which burst in 2007 and precipitated a once-in-a-century financial crisis and recession—is not something most folks are excited to see a sequel of. But five years of declining or stagnating housing prices, the market turned around big time in 2012, making some analysts worry that we’re seeing the beginnings of Housing Bubble 2.0.
As you can see, home prices in most of the country are far from the bubble levels of mid-2000s, but if you drill down deeper to look at individual markets, one sees a different picture. Jed Kolko, housing economist with the real estate site Trulia, has been tracking home prices across the country to see which markets are over and undervalued. In a forthcoming “Bubble Watch” report, he finds that while most of the U.S. real estate market remains significantly undervalued, there are certain markets that are straying into bubble territory.
According to Kolko’s analysis, which looks at several factors like price-to-income ratio, the price-to-rent ratio, and prices relative to their long-term trend, markets in Orange County California and Los Angeles are more than 10% overvalued. Kolko also pegs the Austin, Texas market at 10% overvalued, while 7 other markets range from 4% to 7% overvalued. Those include:
- San Antonio, TX;
- Honolulu, HI;
- San Francisco, CA;
- Houston, TX;
- Riverside-San Bernandino, CA; and
- Oakland, CA
Unsurprisingly, these markets — concentrated in Texas and California, have also seen double digit home appreciation over the past year, with Orange County real estate appreciating a whopping 23.4% since October of 2012.
…
http://www.newyorkfed.org/householdcredit/2013-Q3/index.html
NY Fed Q3 report on credit was released today. Here’s the link.
The main thing to note after a brief blast through the report is page 3, which shows the amount of debt outstanding increased last quarter.
There have been a few times that this has occurred since peak debt levels were reached in 2008, but this move was the largest quarterly increase since 2008.
It could very well be a blip (as others were), and the deleveraging of households could resume next quarter, in which case there is a weaker argument to end QE.
It could also be the start of all of those excess reserves that the Fed has created coming out to play–in which case the inflation hawks around the table might get more air time…
A liar quoting a liar organization….
Do u really expect us to believe there is any delivering going on?
You’re shameless.
“NY Fed Q3 report on credit was released today.”
Excerpt: “The Quarterly Report on Household Debt and Credit for the third quarter of 2013 shows the first substantial increase in outstanding balances since 2008, when Americans began reducing their debt.”
“When Americans began reducing their debt” is double-speak for Americans having their giddy debts discharged in bankruptcy court.
What’s the matter with you HBBers this morning? Haven’t you heard the big news? ANDY KAUFMAN IS ALIVE!!!!!!!!!
http://www.tmz.com/2013/11/13/andy-kaufman-alive-daughter-video-dead/
Dang, that would be soooooo awesome if true.
I am so pathetic because I wanna believe! I wanna believe! I really, really do.
No.
http://www.thesmokinggun.com/buster/actress-in-andy-kaufman-hoax-675432
I’m crushed, I tell you, CRUSHED!
“There’s no drama like wrestling.”
The new boss looks like the old boss.
http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2013/11/20131114_Yellen1.jpg
I’m surprised that the union-haterz haven’t latched on to this one yet….
http://tinyurl.com/kzx6z3u
So essentially, they were offered:
-A $10K, one-time bonus (from which income/SS/state/local taxes will be extracted, turning the 10K “bonus” into a $4K bonus)
-A vague promise, contingent on state and local government coughing up $9 billion + of “incentives” to build parts of the “new” 777X in Seattle (assuming, of course, this model will actually be built). Of course, since Boeing won’t be paying any local taxes until 2040, guess where the money to run state/local government will come from?
In exchange, the company gets:
-Elimination of the defined benefit pension plan, to be replaced by 401Ks (AKA “201Ks” by some).
-Pay raises/COLAs limited to 1% every other year, thru 2024.
-Higher insurance premiums/co-pays.
-fixr’s Commentary:
- I think 99% of the J6Ps now believe that eliminating defined benefit pensions, and replacing them with a (typically crappy) 401K is a giant negative.
- A 10 year wage freeze (for all intents and purposes)? You would have to be an idiot to sign up for that.
-Typical Repub-speak to the contrary, most Boeing workers aren’t idiots. According to all of the papers, manufacturers nationwide are bitching about a “shortage of skilled workers”. Here’s a clue. The ONLY people still working at Boeing are “skilled”. They’ve laid off all of the kids and the mouth-breathers, and outsourced that work. Of course, we have the 787 itself to show us how well that strategy workedel
-The Boeing management insists that the South Carolina experiment is doing well. Yeah, and these were the same guys that said the 787 was going along peachy, and chose to pick a fight with their engineering troops, right before an engineering crisis HTF.
My former employer in Wichita tried the same thing, when they started building light piston-engine airplanes again, and moved the work to the Kansas equivalent of South Carolina. Amazingly enough, they discovered that you can’t get some schmoe off the street, give him a two week course in blueprint reading, and turn them loose with rivet guns. And these guys were highly educated (by national standards). A bunch of guys they kicked to the curb were hired back as contractors for a number of years, to get the facility straightened out.
How turning South Carolinians (many of who are “disadvantaged” and were hired as a trade off for South Carolina incentives) loose to put together what is arguably the most advanced civilian aircraft on the planet remains to be seen, IMO.
For starters, (from the -fixr’s training at an OEM composite repair school) here’s the problem with composite structures, vs. aluminum:
-You need expensive NDT guys to evaluate any damage.
-Damage may not be limited to the visible damage……you can have (for example) a fuel truck hit a wing tip, and the wing may have damage at the wing root attach point, 30-40 feet away. Carbon fiber doesn’t “give”/have any elasticity, like aluminum does. It may take time for collateral damage to become apparant.
-Composites are super expensive……unless there is a distinct performance advantage, nobody wants/can afford to use them. Scrapping/repairing structural composite parts is REAL EXPENSIVE. Mainly because you have to pay someone to say the repair is okay for the life of the airplane.
Now, what do you suppose is going to happen, when some mouth-breathing, anti-regulation, boot-strapping South Carolinian (or Texan, for that matter) is going to do when he (I’m assuming) accidently damages one of these parts while trying to assemble it, knowing that he’ll probably be fired from his $12/hour job (aka “upper middle-class” in South Carolina)
Unless you have a QC department that’s on the ball, and can’t be intimidated by upper management, you are going to have a “pencil-whip” is what you are going to have. Assuming of course, he can’t hide it, and has to report it.
But it’s JMO…….what do I know?
It could be worse. We might all end up flying around on Chinese airliners. Piloted by guys on H1-B visas.
Why would pilots needs visas, or even passports? You only *need* to get through customs in your own country right?
That would stop me from traveling by air!
In further news, Lockheed laying off 4000.
J6P is right - 401k’s are not a good deal. I mean sure, stick some money in it. But LOL @ stuffing a 401k with more than maybe 150-200k. Anything more than that is too much deferred money for too little gain. There are better ways to shield the money from taxes that don’t require waiting unti you are old to realize the benefits.
My rule is: only do a 401k up to your firm’s match amount and (obviously) even then, only if you’re going to stick around long enough for it to vest. Otherwise, look into IRA or other more aggressive plans. IRA stuffing = unpatriotic, but it also = winning. Look at Romney, he blatantly avoided taxes, got away with it, and was nominated for Pres.
So when are you going to tell us again to buy businesses that generate lots of cash and not report the income?
I never advocated hiding income. I did advocate shielding income and structuring things to limit taxes legally. And I absolutely recommend getting into businesses where it’s hard for the IRS to prove anything or even bother trying — certain types of eating establishments are perfect for this. This is why getting paid frequently in cash is a good thing–not just that your patrons pay cash, but many/most carryout or diner patrons pay in cash. Perhaps you’ve noticed that certain ethnic groups tend to own a lot of diners, for example. It’s not because they’re too basic to figure out something more complex, it’s because the culture encourages certain norms.
Rental RE is another example where depreciation and other tax benefits are rampant.
Liberace!
where it’s hard for the IRS to prove anything
Don’t the kids call that money laundering?
LOLZ
My 401k balance is 400% higher than on January 1 2009.
Tell me more sage advice wise Joey!
Just as I’ve been saying… PAYE/IBR burns taxpayers.
http://www.seethruedu.com/updates/pay-you-earn-burns-taxpayers
Under these plans, you might as well get as much education as possible, since even worst outcome is having to pay back ~10% of post-tax earnings for 20 yrs and then have the rest of the principle and interest forgiven. (It’s 10 yrs of payback if you are a gov’t employee.)
http://nypost.com/2013/11/13/obamas-latest-broken-promise-is-destro...
When I first saw the headline saying Bill Clinton was advising President Obama to “honor his commitment,” I had to laugh. The idea of Monica Lewinsky’s boyfriend as moral referee always cracks me up.
Then I got to wondering. Which commitment was Clinton talking about?
Is it the one Obama made to the Israeli people, that he had their backs and would never let Iran get a nuclear weapon? Or was it his promise to enforce a “red line” in Syria?
Or maybe it was Obama’s promise to “never rest” until we caught the terrorists who killed our ambassador and three other Americans in Libya?
Or was Clinton talking about the many times the president said he would “never rest” until every American who wanted a job had one?
Or maybe he was talking about the pledge to change the tone in Washington? Or to go through the budget “line by line” and cross out the waste driving up the deficit?
You get the picture — any of those whoppers would qualify. But, of course, Clinton was talking about the broken promise of the moment, the one where Obama vowed that “if you like your health insurance, you can keep it.”
Clinton may not have a moral compass but he does have a great political compass and he knows that Obamacare is the death star for Democrats.
‘he knows that Obamacare is the death star for Democrats’
And the Presidents signature achievement! That’s gotta hurt.
Where is Mango to defend his Messiah!
He’s on the Sad Panda cam, in some South American zoo.
LMAO
It gets worse.
Dan Munro, Contributor
I write about the intersection of healthcare innovation and policy.
Pharma & Healthcare
11/13/2013 @ 11:28PM
Latest Obamacare Enrollment Numbers Add Heat To House Vote On Friday
Earlier today, Health and Human Services announced the Obamacare enrollment numbers for the first 32 days of this expanded open enrollment period (pdf here).
Given all the preliminary numbers we’ve seen up to this point, it’s not that surprising that the numbers were low – especially through the beleaguered Federal Exchange – Healthcare.gov. While the national number is 106,185 (“who have selected a Marketplace plan”), the number for the Federally run Marketplace was only one quarter that size – 26,794. Unlike insurance companies (who don’t count subscribers until first payment), these numbers are simply those who have successfully navigated the entire shopping process and selected a Bronze, Silver, Gold or Platinum plan.
…
Interesting map
http://www.washingtonpost.com/blogs/govbeat/wp/2013/11/12/another-way-to-explain-who-we-are-the-15-types-of-communities-that-make-up-america/americancommunities.org/
http://www.bloomberg.com/news/2013-11-14/obamacare-is-whatever-obama-says-it-is.html
Based on my read, this seems a reasonable assessment of where we are.
I’m waiting for someone to spin the rollout as anything other than a disaster for the law, insurance companies, and the insured. The only people who are happy (as far as I can tell) would be the uninsured with pre-existing conditions, who are going to get insurance for at least one year for a lot less than they could ever get it before.
Scientists Confirm World’s Oldest Creature…But Kill it Determining Its Age
by Jon David Kahn
14 Nov 2013, 6:09 AM PDT
In 2006, climate change experts from Bangor University in north Wales found a very special clam while dredging the seabeds of Iceland. At that time scientists counted the rings on the inside shell to determine that the clam was the ripe old age of 405. Unfortunately, by opening the clam which scientists refer to as “Ming,” they killed it instantly.
Cut to 2013, researchers have determined that the original calculations of Ming’s age were wrong, and that the now deceased clam was actually 102 years older than originally thought. Ming was 507 years old at the time of its demise.
According to the Mirror, Ocean scientist Paul Butler from Bangor University said: “We got it wrong the first time and maybe we were a bit hasty publishing our findings back then. But we are absolutely certain that we’ve got the right age now.The nice thing about these shells is that they have distinct annual growth lines, so we can accurately date the shell material.That’s just the same as what archaeologists do when they use tree rings in dead wood to work out the dates of old buildings.”
The 507-year-old clam shattered the previous unofficial title holder for world’s oldest creature held by a 374-year-old Icelandic clam in a German museum.
No information was given as to which scientist murdered the former record holder.
http://www.drudgereportarchives.net/Article.php?ID=450746& - -
“As the hole grew, it swallowed the Dupre’s porch and new boat. Now, his neighbor’s swimming pool and a portion of that home have fallen in as well.”
Glinda
Come out, come out, wherever you are because this big sinkhole just swallowed your car.
It swallowed your car, it’s taken your boat, now there goes your pool and that’s all that she wrote.
Possible sinkhole reported in yard in Florida
Story Print 24 minutes ago
DUNEDIN, Fla. (AP) — Residents of several Florida homes have been evacuated due to a possible sinkhole that opened in a backyard in Pinellas County on Thursday.
Dunedin Deputy Fire Chief Trip Barrs said the hole appeared to be about 12 feet wide when officials arrived on the scene. Residents of the neighboring houses also were evacuated as a precaution.
The Tampa Bay Times reports (http://bit.ly/1gOqlel) that the ground is so unstable that two homes must be demolished.
Television footage showed part of a patio caved in and a boat on the edge of the hole. Tampa area television stations reported that a neighboring pool appears to have cracks.
The affected neighborhood is in Dunedin, a small city in northern Pinellas County, about 20 miles north of St. Petersburg.
Sinkholes are common in Florida because the peninsula is made up of porous carbonate rocks such as limestone that store and help move water underground. Over time, the rocks can dissolve from an acid created from oxygen in water, causing a void under the limestone roof. When dirt, clay or sand gets too heavy for the limestone roof, it can collapse, creating a sinkhole.
On Feb. 28, Jeffrey Bush died when a sinkhole opened under his bedroom in Seffner, Fla., near Tampa. His body was never recovered. In August, sections of a building at a resort near Orlando collapsed into a sinkhole. No one was injured.
Homeowner Michael Dupre said the family heard a noise that sounded like a sledgehammer pounding on the wall early Thursday morning.
Dupre told Bay News 9 there had been “sinkhole activity” in the area. “After the Seffner sinkhole, we were scared. We’ve been dealing with our insurance company and finally two days ago, they started working on our house. Now it looks like our house is gone.”
As the hole grew, it swallowed the Dupre’s porch and new boat. Now, his neighbor’s swimming pool and a portion of that home have fallen in as well.
Engineers were called in to assess the homes and ultimately decided both Dupre’s home and his neighbor’s would be complete losses.
A backhoe was used to pull Dupre’s boat from the hole. Crews had feared fuel in the boat could leak into groundwater. Otherwise, the rescue crews are in a holding pattern until the hole stabilizes.
State officials say three counties in the Tampa region are known as “sinkhole alley.” Two-thirds of the sinkhole damage claims reported to the state Office of Insurance Regulation between 2006 and 2010 came from Hernando, Hillsborough and Pasco counties. Dunedin is in neighboring Pinellas County.
Associated Press
Contra Costa has suffered steepest home-price drop among large U.S. counties
November 14, 2013, 10:53 AM
Among the most populous U.S. counties, Contra Costa County in Northern California saw the largest drop in home values in recent years, according to government data released Thursday.
Contra Costa County’s median property value during the 2010-to-2012 period was about $392,900, down $141,500, 0r 26%, from a median of $534,400 over the 2007-to-2009 period, according to U.S. Census Bureau data. Those results compare with a U.S. drop of about $17,300, or 9%, to $174,600 over the same time period.
Among the country’s 50 counties with the largest populations, eight of the top 10 price drops were in California counties. California, of course, is the most populous U.S. state and home to numerous communities that were hit particularly hard when the housing bubble burst. The two non-California counties in the top 10 were Miami–Dade County in Florida and Nevada’s Clark County, of which Las Vegas is the county seat.
Among the big counties with the largest price drops, Clark saw the largest percentage decline. The median property value there fell more than 40% in the 2010-to-2012 period from the 2007-to-2009 period.
…
Don’t know how the 26% decline figure was computed, but the home we used to occupy as owners is shown on Zillow as down by 50%.
“the home we used to occupy as owners is shown on Zillow as down by 50%.”
vvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvvv CRATER!!!!!!
It’s also good to bear in mind that Zestimates exhibit upward bias…
Hey, a couple guys at work and I want to go in on a house to buy and start our real estate empire. What can wrong? I mean, everybody is flipping homes left and right. Easy street. Accrue equity, Tom Vu will see me for advice.
#Just Pay More
Vampire squid is what’s for dinner tonight.
Funniest #AskJPM tweets reveal pitfalls of social media
Bad idea.
by Sabri Ben-Achour
Marketplace for Thursday, November 14, 2013
JP Morgan Chase invited the world of Twitter to ask questions of its Vice Chair Jimmy Lee using hashtag #AskJPM. Questions on leadership, career advice.
It didn’t go well:
IS IT TRUE “JPM STANDS FOR “JUST PAY MORE”?
WHAT’S THE BEST WAY TO GET BLOOD STAINS OUT OF A CLOWN SUIT?
DOES JAMIE DIMON PET A SMALL CAT AND LAUGH OMINOUSLY WHILE HE’S RUINING POOR PEOPLE’S LIVES?
But maybe the most apt question was:
WHY DID U THINK THIS WOULD BE A GOOD IDEA?
It was basically as if Count Dracula decided to do social media engagement with the villagers.
…
Just say Wen.
Legal/Regulatory November 13, 2013, 10:00 pm
JPMorgan’s Fruitful Ties to a Member of China’s Elite
By DAVID BARBOZA, JESSICA SILVER-GREENBERG and BEN PROTESS
Wen Ruchun
To promote its standing in China, JPMorgan Chase turned to a seemingly obscure consulting firm run by a 32-year-old executive named Lily Chang.
Ms. Chang’s firm, which received a $75,000-a-month contract from JPMorgan, appeared to have only two employees. And on the surface, Ms. Chang lacked the influence and public name recognition needed to unlock business for the bank.
But what was known to JPMorgan executives in Hong Kong, and some executives at other major companies, was that “Lily Chang” was not her real name. It was an alias for Wen Ruchun, the only daughter of Wen Jiabao, who at the time was China’s prime minister, with oversight of the economy and its financial institutions.
JPMorgan’s link to Ms. Wen — which came during a time when the bank also invested in companies tied to the Wen family — has not been previously reported. Yet a review by The New York Times of confidential documents, Chinese public records and interviews with people briefed on the contract shows that the relationship pointed to a broader strategy for accumulating influence in China: Put the relatives of the nation’s ruling elite on the payroll.
And the Wen family’s sway was not just political. After Ms. Wen’s father joined the inner circle of China’s rulers as vice prime minister in 1998, the family amassed a secret fortune through a series of partnerships and investment vehicles, a 2012 investigation by The Times found.
Now, United States authorities are scrutinizing JPMorgan’s ties to Ms. Wen, whose alias was government approved, as part of a wider bribery investigation into whether the bank swapped contracts and jobs for business deals with state-owned Chinese companies, according to the documents and interviews. The bank, which is cooperating with the inquiries and conducting its own internal review, has not been accused of any wrongdoing.
The investigation began with an examination of the bank’s decision to hire the daughter of a Chinese railway official and the son of a former banking regulator who is now the chairman of a state-controlled financial conglomerate. The contract with the consulting firm of Ms. Wen, 40, indicates that the bank’s hiring practices also touched the highest rungs of political power in China. Her father was prime minister from 2003 until earlier this year. Her mother has served as a government official with oversight of the nation’s gem and diamond industry. And since 2006, Ms. Wen’s husband has been an official at the China Banking Regulatory Commission, according to China Vitae, an online database.
For Ms. Wen’s consulting firm, Fullmark Consultants, the JPMorgan deal was lucrative. While many Hong Kong investment bankers were earning as much as $250,000 a year, JPMorgan paid Ms. Wen’s firm $900,000 annually from 2006 to 2008, records show, for a total of $1.8 million.
JPMorgan appeared to benefit from the relationship as well. Fullmark claimed in a confidential letter to the bank that it “introduced and secured” business for JPMorgan from the state-run China Railway Group, a construction company that builds railways for the Chinese government. The bank was an underwriter in the company’s 2007 initial public offering, which raised about $5 billion.
…
10:43 am
Nov 14, 2013
Banks
Big Investment Banks Could Face $100 Billion in Civil Litigation Costs
By Saabira Chaudhuri
CONNECT
Bloomberg News
Global investment banks could be on the hook for almost $100 billion over the next decade in civil litigation costs tied to allegations of foreign-exchange markets rigging, interest rate manipulation, and soured mortgages according to a new report.
The report, the latest effort to tally the wide variety of incoming bank legal bills, was put out Tuesday by analysts at Keefe, Bruyette and Woods. It said litigation has cost global investment banks $44 billion since the first quarter of last year, and $13.8 billion in the third quarter alone.
KBW says civil claims are likely to drag on for the rest of the decade as ” the nature of some manipulation offences and the volume of evidence to sift through” makes it potentially “more costly … harder to prove and also hard to quantify a loss.”
The firm estimates that civil actions tied to the London interbank offered rate, or Libor, and its lesser-known peer, the Euro interbank offered rate, or Euribor could burn the biggest hole in banks’ pocketbooks, costing $46 billion. KBW says actions related to foreign exchange probes could cost $26 billion and that Federal Housing Finance Agency costs about $24 billion.
“Litigation costs are here to stay and are part of the fabric of investment banking costs,” said KBW analyst Andrew Stimpson. He notes that, despite the large numbers of potential litigation costs, these would still be a slow-down from the run-rate seen in 2012-13 if the charges taken are spread across the next decade.
KBW says that J.P. Morgan—which is expected to announce a $13 billion settlement with the Justice Department and other regulators—is its top global investment bank pick, along with Société Générale. The firm notes that J.P. Morgan “should start 2014 with a cleaner slate than most peers” after a quarter heavy on legal provisions. KBW also says that, despite being exposed on civil Libor actions, J.P. Morgan’s “balance sheet is more than strong enough to take it.” J.P. Morgan’s shares were down 25 cents to $53.72 in recent trading. The stock has risen 34% in the past 12 months.
J.P. Morgan’s legal costs have ballooned. Excluding its expected settlement, a mortgage-litigation push has caused overall legal expenses this year at J.P Morgan to nearly triple—to $10.3 billion through September—from $3.8 billion over the first nine months of 2012. A J.P. Morgan spokesman wasn’t immediately available for comment.
…
Chalk one up for Joe 6Pack!
Originally published Saturday, November 9, 2013 at 8:05 PM
How the beer lobby fought Wall Street … and won
By Jamila Trindle
Foreign Policy
It’s a case study in how a few American businesses with long-standing household names, and their D.C. lobbyists, can set in motion changes to a global market and cause some of the planet’s biggest financial institutions to alter their operations.
Big brewers, including Anheuser-Busch, claimed Wall Street firms were taking advantage of an obscure metals regulation to drive up beer prices.
WASHINGTON — If you can make a complex disagreement over commodity pricing about beer, you probably should. That’s what beer lobbyists proved this year with a successful campaign that translated a fight about obscure commodities markets into something everyone can understand: the price of a can of beer.
In the spring, the Beer Institute, a trade group that represents big brewers including Anheuser-Busch and MillerCoors, ramped up their lobbying in Washington, D.C., to draw attention to the vagaries of the global aluminum market, claiming that big Wall Street firms were taking advantage of obscure metals regulations to drive up the prices.
“Wall Street megabanks should not be able to levy hidden taxes on Main Street beer drinkers,” as Sen. Sherrod Brown, D-Ohio, put it in August.
In the months since, lawmakers have called for banks to divest their commodities holdings, regulators and law-enforcement agencies have opened investigations, and the Federal Reserve floated the idea of making it more expensive for banks to own physical commodities.
Now, the London exchange that runs the aluminum market is changing its policies. It’s a case study in how a few American businesses with long-standing household names, and their lobbyists, can set in motion changes to a global market and cause some of the planet’s biggest financial institutions to alter their operations.
So, the aluminum market is a complicated place involving an exchange in London, warehouses all over the world, and buyers with disparate interests — some are investors, others are using the metal to make stuff.
Most of the aluminum bought and sold around the world keys off the price of derivative contracts on the London Metals Exchange, even though the exchange represents a relatively small portion of the market used mostly by bankers and investors.
The metal tied to those contracts is stored in a system of warehouses, some of which are owned by banks like Goldman Sachs and J.P. Morgan. Until now, the London Metals Exchange has only required the warehouses to move a relatively small amount of metal out every day, creating long waits that drive up the overall price.
Metal users have complained for years about banks’ and trading firms’ role in the London Metal Exchange’s warehouse system, arguing that storage owners create bottlenecks and artificially raise the prices they pay for metals like aluminum, but they failed to gain traction. Representatives from other companies that use aluminum had met with regulators who oversee derivatives markets at the Commodity Futures Trading Commission (CFTC) and were told the CFTC couldn’t help, in part because the exchange was based in London.
But that was before the metal users broke out the big guns — the beer lobby.
In the spring, the Beer Institute ramped up pressure on the London Metals Exchange (LME) to change its rules and started meeting with Senate staffers, catching the attention of Brown. On July 9, representatives from the Beer Institute, Miller Coors, the American Beverage Association and others met with different staffers at the CFTC. Suddenly they were told the agency did have some oversight over the London Metals Exchange after all, through a 2001 letter allowing the exchange to trade with U.S. customers.
The following week, the CFTC sent out letters to some warehouse owners telling them to preserve documents, in what turned out to be the beginning stages of an investigation. The Department of Justice later joined in.
At a hearing on July 23, Tim Weiner, a global risk manager with brewer MillerCoors, testified that the lengthy waits to get metal out of LME warehouses in Detroit added $3 billion to the cost of aluminum last year. Brown and Sen. Elizabeth Warren, D-Mass., used the hearing to raise broader questions about whether banks should own oil pipelines and metals warehouses.
Amid this scrutiny, J.P. Morgan said on July 27 it was putting its physical commodities operation up for sale. And on July 31, Goldman Sachs conceded to complaints from brewers and others, saying that it would provide immediate delivery of aluminum to warehouse customers.
…
Heard something today that will further restrict new home construction in the northern Central Valley of CA. It’s called SB5 (CA Senate Bill 5), and essentially what is says is this:
Local municipalities need to come up with a plan to manage flood risks in the 200-year flood zone (build levies, etc.), or you can’t issue building permits in that zone. FEMA’s standard is the 100-year flood.
I think this must have been a reaction to Katrina–it was passed in 2007.
In any event, the deadline for establishing the mitigation plan is coming up in a couple of years for municipalities (short enough time to cause problems with developments starting now). Builders are taking notice, and until the way through SB5 is better defined…they are avoiding properties potentially affected by a 200-year flood event.
One concern is that the method for payment of the mitigation measures might be bonds issued, but the payment of those bonds can’t be forced upon existing residents within a 200-year flood zone (if the homeowner is within the 100-year flood plain, it might make sense to pay something additional to get out of flood insurance requirements, but not in the 101-200 year flood plain), so new homes would bear the entire burden…and that burden is undefined at the moment, and could be rather large–which might make an otherwise viable project NOT viable.
Apparently there is already talk of delaying the implementation of the law, but that’s not determined yet. In the meantime, there are whole areas that were planned to be new homes that are affected.